Second District, Division 2 Does Reverse Section 1717 Award To Nonsuing Partnership.
Here is an interesting case litigated on appeal by a former Second District jurist that shows how the absence of the requirement of a statement of decision can impede an appeal, in tandem with a failure to specifically document the error. The “bottom line” in the fee award area is that many (if not most) appellate courts will not presume error. Ring v. Marasco, Case No. B213965 (2d Dist., Div. 2 Apr. 28, 2010 (unpublished) is the opinion illustrating the interplay of these interesting appellate principles.
In Ring, trustees of a trust sued cousins in a dissolution dispute involving a limited partnership to lease and develop 23 acres in Marina Del Rey, CA. Judgment was entered requiring the partnership to sell the Mariner’s Village apartment complex, a result challenged by cousins through various appellate writs and stay requests. Eventually, Division 7 resolved a critical writ mandate proceeding by reversing the judgment and awarding costs to cousins. Via a costs memorandum and coinciding motion, cousins sought their attorney’s fees and nonstatutory costs in connection with trial and appellate proceedings as well as in connection with the fee motion itself. They requested fees of $1,733,470.90 and nonstatutory costs of $118,540.96 (a total of $1,852,011.16). Cousins also requested a fee award of $397,708.81 paid to attorneys representing the limited partnership in connection with efforts to sell the property and wind up its business.
The trial court awarded the cousins $1.65 million in fees and costs, as well as awarded the limited partnership $397,708.81 in fees. Trustee appealed, gaining a “split” verdict on appeal (even though losing by far the monetary tally as far as fees were concerned).
The fee award to the limited partnership was reversed. Why? Pretty easy to cipher. Limited partnership was not a suing litigant, so it could hardly recover as a prevailing party under Civil Code section 1717.
That focused attention on the substantial fee award to cousins, recalling that the trial court “shaved” over $200,000 off the cousins’ fee request. The appellate panel began by reiterating a staple of appellate review—it cannot presume error, with the party challenging a fees award having an affirmative obligation to provide an adequate record to assess the claimed abuse of discretion by the lower court. (Vo v. Las Virgenes Municipal Water Dist., 79 Cal.App.4th 440, 447 (2000).) Given that the trial court did not explain how it calculated the award (with no statement of decision required under California law), the Court of Appeal recognized that this failure to specify “may make it impossible for us to conduct appropriate review.”
Trustee’s main argument was that the costs for two failed appellate writ petitions should not have been included in the overall award. However, this argument failed because (1) the trial court did reduce the fee request by over $200,000, which would take into account a bulk of the failed appellate work by cousins, and (2) trustee failed to provide record citations to specific pages establishing what was actually billed on these failed writ proceedings. The upshot? “In the absence of a proper roadmap, we need not consider the argument that the trial court should have reduced the requested award by more than $202,011.16,” citing Guthrey v. State of California, 63 Cal.App.4th 1108, 1115 (1998). The substantial fee award to counsins was affirmed in entirety.