Mediation Fee Condition Precedent Satisfied in this Case.
For those following our blog, our category “Mediation” has many cases discussing California Association of Realtors (CAR) form California Residential Purchase Agreements having some conditions precedent to attorney’s fees recovery, with the big one being that the buyer or seller must agree to mediation before resorting to arbitration or court action.
Buyers in Sharifpour v. Le, Case No. G047481 (4th Dist., Div. 3 Jan. 10, 2014) (unpublished) won a property nondisclosure award in an arbitration of $933,682.89 against Sellers, consisting of $184,000 in economic damages, $368,000 in punitive damages, and $381,682.89 in attorney’s fees and costs, with the lower court confirming almost all of the arbitration award except for a reduction in the punitive damages component to $147,000.
Buyers appealed, and they did not get any relief on appeal.
They challenged Buyers’ compliance with the mediation condition precedent to fee recovery, but the proof showed that a pre-litigation mediation demand was sent, a demand ignored by Sellers. Although Buyers did resist arbitration based on Sellers’ demurring to Buyers’ complaint (a losing argument, because arbitration was ordered), that position did not negate the fact the pre-litigation mediation request had indeed been made. “However, paragraph 17A [of the CAR form, containing the mediation condition precedent] does not say that attorney fees will be unavailable to a prevailing party whose offer to mediate is rejected and who thereafter refuses to accept an offer to arbitrate made only after the litigation has commenced.” (Slip Opn., p. 8.) Fee award sustained on review, in a 3-0 decision authored by Acting Presiding Justice Moore.