Civil Code Section 1717: You Gotta Have A Contract Predicate As A Condition Of 1717 Fee Recovery

Absence of Contract Between the Parties With a Fee Clause Precluded Recovery.

     The Fourth District, Division 1, in Cornelius v. Vogt, Case Nos. D053035, D053286 (4^th Dist., Div. 1 Feb. 5, 2010) (unpublished), reminds us all that there must be a governing contract between the parties to allow recovery of prevailing party fees under Civil Code section 1717.

     In the case itself, there was a Date Street agreement, but between the agreement itself, its revisions and oral modifications, no attorney’s fees clause was included. However, there was a separate deed of trust between one party and an outside bank that did have a fees clause. The prevailing party under the Date Street agreement attempted to recoup fees under the trust deed provision. No way, said the appellate panel in Cornelius. Using section 1717’s own language, plaintiff did not “bring his action on the contract” that involved the trust deed, meaning there was no contract predicate upon which to base a fee award. The lower court correctly denied fees to plaintiff.