Defense Might Prevail In End, So Let’s Wait and See.
We predicted in our May 27 and June 5, 2012 posts that Frog Creek Partners, LLC v. Vance Brown, Inc., 206 Cal.App.4th 515 (2012) would be an oft-cited decision when dealing with prevailing party status for fee purposes where there are interim successes in arbitration compel proceedings but the main action on the merits of the contract claims is still ongoing.
Well, we can report that our local Fourth District, Division 3 found Frog Creek instructive in Wherry v. Award, Inc. (Wherry II), Case No. G045520 (4th Dist., Div. 3 June 28, 2012) (unpublished).
There, a lower court granted a motion filed by plaintiffs for fees incurred in defeating a petition to compel arbitration filed by the defense after plaintiffs sustained the result in an earlier appeal (Wherry I). Acting Presiding Justice Rylaarsdam, writing for a 3-0 panel, found the reasoning in Frog Creek instructive is determining that the fee award was premature. After all, the main action in which the petition to arbitrate was filed has not been completed, meaning the defense might prevail in the overall action. Otay involved a discrete arbitration petition proceeding, not just one cog in an existing lawsuit that had more life to it. Like Frog Creek, the 4/3 appellate court disagreed with Kors and Acosta in some respects, especially finding erroneous the conclusion that independent contractual language could dictate enforcement of a definition of prevailing party different from that provided in Civil Code section 1717.
Fee award reversed because it was premature.