Lack of Allocation Was Fatal for Brandt and RFA Issues.
Insured prevailed in a suit against auto insurer for making repairs rather than declaring the car a total loss. However, insured was denied requested fees of $500,000 ($250,000 plus a 2 multiplier) even though claiming them under one of three theories: (1) California’s private attorney general statute (CCP § 1021.5); (2) recouping policy benefits under Brandt v. Superior Court, 37 Cal.3d 813, 817 (1985); and (3) fees incurred to prove up facts that were denied by insurer in requests for admissions (CCP § 2033.420).
The fee denial was affirmed in Benning v. Wawanesa Gen. Ins. Co., Case No. D058442 (4th Dist., Div. 1 Apr. 26, 2012) (unpublished).
The first ground--CCP § 1021.5--was not satisfied because the insured’s win did not benefit a large class of people or the general public.
The second ground--Brandt policy benefit fees--failed because insured sought compensation for all work, not making an allocation which was insured’s burden under Cassim, a post-Brandt case clarifying contingency fee recovery in these situations. (The Rutter Group treatise recommends to practitioners that an accounting allocation is necessary to separate true Brandt fees from nonrecoverable bad faith/tort fee work.)
The third ground--CCP § 2033.420--did not justify fees, again, because of insured’s failure to allocate fees only to the work needed to prove up facts at trial from denied RFAs. Again, the lack of allocation was fatal because the fee request did ask for reimbursement for time occurring well before the RFAs were denied.
If there is a practice tip emanating from this decision, it is that winning plaintiffs need to allocate time to recoverable tasks when claiming fees under Brandt or the RFA costs-shifting provision.