Trial Court Did Not Err in Apportioning Some Fee Recovery Out With Respect to Successful Mechanic’s Lien Claim.
HJH Construction, Inc. v. California Bank & Trust, Case No. E053033 (4th Dist., Div. 2 Feb. 7, 2013) (unpublished) involved a failed real estate development project in Palm Springs where general contractor received a $690,710-plus judgment against bank based on a bonded stop notice claim. Contractor also won a mechanic’s lien claim based on the theory that its prior demolition of a structure was commencement of a work of improvement so as to defeat lender’s priority claim based on a subsequent nonjudicial foreclosure. The trial court awarded 80% of the requested attorney’s fees on the stop notice claim based on the fee-shifting provision contained in Civil Code section 8558 (formerly section 3176).
City Hall, Palm Springs, CA. Carol M. Highsmith Collection, Library of Congress.
On appeal, winning contractor challenged the apportionment of fees and failure to award 100% of the request, rather than allocating out 20% of fees expended on the fee non-compensable mechanic’s lien claim. However, the appellate court affirmed, finding it was no abuse of discretion for the lower court to make the allocation that it did.
BLOG BONUS--The mechanics lien/stop notice statutory schemes were amended in major respects effective January 1, 2011 and then July 1, 2012 (with most of the changes taking effect on July 1 of last year). For those of you wanting a summary of the revisions, see co-contributor Mike’s article, “Survey of 2011 Amendments to California’s Mechanic’s Lien Statutory Scheme and California Court of Appeal Decisions in Mechanic’s Lien Area,” published in the March 2012 edition of Lexis/Nexis/Matthew Bender’s California Real Estate Reporter.