CALIFORNIA ATTORNEY'S FEES

Civil Rights: Plaintiff Losing Intertwined Labor Code § 1102.5/FEHA Claims Was Properly Not Assessed With Attorney’s Fees Under FEHA And Was Improperly Assessed With Routine Costs As Against Los Angeles County

Costs Award Reversed Because Intertwined Claims Were Not Frivolous In Nature.

            If a trial judge finds that a plaintiff’s FEHA case is not frivolous in nature, a defendant faces large odds to gain an award of attorney’s fees and costs.  Hays v. County of Los Angeles, Case No. B291542 (2d Dist., Div. 7 Mar. 26, 2020) (unpublished) illustrates well this commentary.

            Plaintiff suffered an adverse summary judgment motion in a mixed Labor Code § 1102.5 retaliation and FEHA suit against former employer County of Los Angeles.  The trial judge denied County’s bid for $303,857.94 in attorney’s fees/costs under FEHA, after finding the case was not frivolous in nature.  However, the lower court did award $15,644.44 out of $20,740.44 in routine costs.

            The fee denial was affirmed based on the trial court’s conclusion that the case was not frivolous in nature.  However, the costs award had to be reversed based on County’s concession that the Labor Code/FEHA claims were “indistinguishable” such that the non-frivolity finding translated into a conclusion that routine costs were not awardable under Williams v. Chino Valley Independent Fire Dist., 61 Cal.4^th 97, 114-115 (2015). 

Section 998: 998 Offer Requesting Release Of All Claims In Above-Captioned Civil Action And Release Of Affiliate Nonparties Did Not Render It Invalid

$35,240.80 Costs Shifting Award Affirmed On Appeal.

            In Kaplan v. Del Amo Hospital, Inc., Case Nos. B296107/B297898 (2d Dist., Div. 1 Mar. 26, 2020) (unpublished), defendant did serve a “successful” CCP § 998 offer to plaintiff, given a defense verdict.  The trial judge awarded costs of $35,240.80 against plaintiff, prompting an appeal on the grounds that the 998 offer was invalid.

            That challenge did not prevail on appeal because the 998 offer was valid.  Plaintiff argued that the 998 offer was conditioned on a release of omnibus claims, but the language of the offer showed it was limited to the claims in the above-captioned civil action, so the release request was not overbroad in nature.  Second, plaintiff contended that the offer’s release of nonparties was too broad, but case law firmly established that inclusion of affiliated non-parties in the 998 offer did not render it infirm.  (Ignacio v. Caracciolo, 2 Cal.App.5^th 81, 84, 88-90 (2016); Fassberg Construction Co. v. Housing Authority of City of Los Angeles, 152 Cal.App.4^th 720, 767 (2007).). Costs award affirmed.

Fee Clause Interpretation, Prevailing Party, Section 1717: Defendant Successfully Challenging Plaintiff’s Trial Court Fee Request, Where Plaintiff Declared Prevailing Party Under Contract, Was Not Entitled To Attorney’s Fees As The Prevailing Party

Defendant’s Limited Appellate Court Win Before Did Not Mean He Prevailed—There Can Only Be One!

            Defendant lost an arbitration to plaintiffs who were declared prevailing parties under a contract by the arbitrator.  Plaintiffs moved for recovery of contractual attorney’s fees under Civil Code section 1717, a request granted by the trial court but then reversed on defendant’s appeal based on an insufficient fee submission.  Defendant then moved for attorney’s fees based on the appellate win, a request denied by the trial court after finding he was not the prevailing party.

            The 1/1 DCA affirmed the fee denial in Achterkirchen v. Montiel, Case No. A153560 (1^st Dist., Div. 1 Mar. 24, 2020) (unpublished).

            The problem with defendant’s approach was that he did not prevail overall under the contract, as Civil Code section 1717 requires.  The arbitrator found that plaintiffs prevailed, with defendant simply winning a skirmish on a collateral fee order along the way.  Because there can only be one prevailing party on the contract (Carriere v. Greene, 39 Cal.App.5^th 270, 276-277 (2019) [discussed in our August 28, 2019 post]), defendant was not the one who prevailed.  He argued that the contractual fees clause cut the other way, but the Court of Appeal panel found that “proceeding” encompassed the entire controversy, not just one appeal in isolation.

Appeal Sanctions, Discovery: Discovery And Family Code Section 271 Sanctions Of $3,250 Against Father Affirmed On Appeal

Also, Father Ordered To Pay Mother $2,980 For Prosecuting A Frivolous Appeal.

            Father, in Rybolt v. Riley, Case No. C086056 (3d Dist. Mar. 24, 2020 (unpublished), appealed from a non-appealable vocational evaluation order and discovery/Family Code section 271 totaling $3,250 for bringing motions to compel which were denied/did not further legitimate purposes of the overall litigation.  Father’s appeal did not go well.  Although it is true sanctions were awarded under both section 271 and the discovery statutes, discovery sanctions do not require an ability to pay as a necessary predicate such that they were no abuse of discretion.  The vocational evaluation order was non-appealable and father’s other arguments were frivolous, prompting the appellate court to award mother $2,980 in attorney’s fees and costs expended in responding to father’s appeal. 

Special Fee Shifting Statute: Elder Abuse Fee-Shifting Provision For Financial Abuse Applies If Liability Found Even If No Damages Ultimately Awarded

Plaintiff Did Recover Damages For Elder Abuse Neglect, Such That Jury Likely Did Not Award “Double Damages” In Any Event On The Financial Abuse Claim.

            In Arace v. Medico Investments, LLC, Case No. E071194 (4^th Dist., Div. 2 Mar. 24, 2020) (unpublished), plaintiff, as personal representative for an elder, sued a senior residential care facility and an employee for elder financial and neglect abuse under the Elder Abuse Act.  The jury found in favor of plaintiff on her financial abuse claim but assessed no economic or noneconomic damages.  The jury also found in favor on the neglect claim, awarding $39,296.32 in economic damages and finding the elder home acted with recklessness, oppression, or fraud, likely not awarding damages on the financial abuse claim so as to not “double dip” on damages assessment.  The trial judge later awarded $89,410 in attorney’s fees and $20,995.36 in costs.

            Defendants appealed, claiming that the “no damages” award on the financial abuse claim undercut the fees/costs awards.   Not so, said the 4/2 DCA.  Welfare and Institutions Code section 15657.5(a) clearly state that a defendant found liable for financial abuse is mandatorily answerable to a plaintiff for reasonable attorney’s fees and costs “in addition to compensatory damages and all other remedies otherwise provided by law.”  Given the jury’s liability determinations of financial abuse, fees/costs recovery was mandatory even if no other form of relief was granted by the jury. 

Civil Rights: Younger-Based Dismissals Can Give Rise To Attorney’s Fees Exposure Against Civil Rights Plaintiffs And In Favor Of Defendant Counties

County Was Awarded $101,174.40 In Fees And $1,259.60 In Costs Under Section 1983 As Against Losing Plaintiff.

            The Ninth Circuit in Citizens for Free Speech, LLC v. County of Alameda, No. 18-16805 et seq. (9^th Cir. Mar. 24, 2020) (published), found that civil rights case dismissals under Younger v. Harris, 401 U.S. 37 (1971) abstention doctrine can lead to an award of attorney’s fees in favor of a prevailing governmental agency and against a losing civil rights plaintiff under section 1983, finding that its blanket prohibition otherwise in Elwood v. Drescher, 456 F.3d 943, 948 (9^th Cir. 2006) was no longer good law.  However, a Younger-based dismissal does not always lead to fee exposure, unless the dismissal materially altered the parties’ legal relationship as it did in this case.  The dismissal allowed the County to continue its abatement proceeding to enforce a billboard ordinance, such that the governmental parties clearly prevailed, resulting in affirmance of the $101,174.40 in fees and $1,259.60 awarded against plaintiff because the suit was frivolous/unreasonable in nature. 

Intellectual Property: Plaintiff’s Copyright Infringement Suit Was Found Without Merit At Both District/Appellate Levels, Such That Denial Of Attorney’s Fees Under 17 U.S.C. § 505 Was An Abuse Of Discretion

Defendants Won Across The Board, Plaintiff Made Objectively Unreasonable Arguments, And Plaintiff Appeared To Bully A Public Teacher, Booster Club, And Parent Volunteer Defendants.

            In Tresona Multimedia, LLC v. Burbank High School Vocational Music Assn., No. 17-56006 et al. (9^th Cir. Mar. 24, 2020) (published), the Ninth Circuit affirmed a summary judgment in favor of defendants (a public school teacher, a not-for-profit booster club, and parent volunteers) in a copyright infringement case brought by plaintiff.  It did so based on the fair use doctrine establishing that no infringement occurred.  However, the federal court of appeals reversed the district judge’s denial of defendants’ request for attorney’s fees under 17 U.S.C. § 505 (the federal copyright fee-shifting statute).

            The reason for the fee denial reversal was grounded in the circumstances of record:  defendants prevailed across the board, defendants won on a fair use defense on appeal (different than the ground relied on by the district judge), many of plaintiff’s arguments were objectively unreasonable, and a fee award would further the purposes of the Copyright Act because it appeared plaintiffs were attempting to bully a public teacher, a booster club, and parent volunteers in meritless litigation.

Quantum Meruit, Referral Agreements: Client Only Signing A Disclosure And Acknowledgment Understanding Letter Section Did Not Give Written Consent As Required Under Former Rule 2-200 Of State Bar Rules Of Professional Conduct For Referral Agreements

Result Was Reversal As A Matter Of Law Of Jury Verdict Based On Contractual Breach And Quantum Meruit, Because Contract Was Unenforceable And QM Claim Was Time Barred.

            Reeve v. Meleyco, Case No. C085867 (3d Dist. Mar. 24, 2020) (published) is an ethics reminder to all practitioners to get an express written consent from a client to a referral fee arrangement.  If not, the attorney has no contractual claim, being left to a quantum meruit claim which has a shorter two-year statute of limitations.

            What happened here is that plaintiff attorney sued defendant attorney after he refused to pay a referral fee, with a jury find in attorney’s favor on both a breach of contract and a quantum meruit theory relating to a $900,000 settlement (although finding that plaintiff had sued too late to get a referral fee for a $3.375 million settlement).  The jury awarded plaintiff $78,750 on both theories, with the trial judge adding another $49,364.35 in prejudgment interest.  Defendant prudently appealed, and it all went POOF! based upon a reversal as a matter of law.

            Justice Mauro, the authoring justice for a 3-0 panel of the Third District, decided that the facts did not show a compliant written consent required under former rule 2-200 of the State Bar Rules of Professional Conduct (now rule 1.5.1).  The writing was defendant’s letter informing client “that the twenty-five percent (25%) referral fee that I [the referred-to attorney] am paying to [plaintiff referring attorney] will come out of my fee and will not increase the fees to either you or your daughter.” Client signed the writing as well as signed a pretyped acknowledgement stating: “I, JAMES G. LUOMA, acknowledge receipt of this letter and understand the contents.” In signing the acknowledgment, client merely confirmed that he received the writing and that he understood what it said.   The Third District did not believe this was actual consent, finding consent way different from dictionary definitions for disclosures, receipt, or understanding.  That meant that the contract was unenforceable such that the contract claim verdict could not stand.

            That brought the appellate court to the quantum meruit verdict, with the claim having a two-year statute of limitations.  The problem here was that plaintiff sued over three years after the settlement money was distributed, way too late.  Plaintiff argued that the four-year limitations for written contracts applied, but this was swept away because quantum meruit is not based on a contract (especially one which is unenforceable).  The judgment was reversed as a matter of law, including the prejudgment interest award.

Allocation, Section 1717, Special Fee Shifting Statutes: Denial of Section 1717 Fees To Prevailing Defendants/Cross-Complainants Affirmed, But Reversed As To Denial Of Code Civ. Proc. Section 1021.9 Fees

Defendants/Cross-Complainants Were Entitled To Statutory Section 1021.9 Fees After Prevailing On Trespassing Claims.

            In Kelly v. Gregory House, Case Nos. A153735 and A153184 (1^st Dist., Div. 1 March 23, 2020) (unpublished), Defendants/Cross-Complainants own and operate a 40-acre organic farm, and had leased 35 additional acres from an adjacent neighbor in order to expand their Gala apples business.  They spent years cultivating/transitioning the leased land to certified organic status.

            Five years into the six-year lease – which included a six-year extension option – adjacent neighbor decided to sell his property.  Neighbor, however, failed to observe the right of first refusal provision contained in the lease.  Instead, he entered into a purchase agreement with his real estate agent without notifying Defendants that he had decided to sell.  When Defendants learned of the pending sale, they contacted the neighbor to remind him of the right of first refusal provision, notified real estate agent of the same, and began the process of acquiring the funds for the purchase.

            Ultimately, the right of first refusal provision was not honored, and the real estate agent moved onto the property, removed trees planted by Defendants, sprayed pesticides, and took other actions that caused Defendants to lose the organic certification on the leased land – all while the lease remained in effect.  Additionally, real estate agent sued Defendants seeking declaratory relief and quiet title, among other claims.  Defendants successfully cross-complained – alleging claims of interference, trespass to land, conversion and negligence – and were awarded $1,669,705 in compensatory damages and $1,000 in punitive damages.

            By the time Defendants’ hearing on their motion for attorney fees came around, the original trial judge had retired, and the successor trial judge denied their fees – determining they had not demonstrated any right to statutory or contractual attorney fees.

            Not so, said the 1/1 DCA.  Defendants were entitled to fees under Code Civ. Proc. § 1021.9 – designed to ensure farmers are able to protect their land from trespassers through civil litigation.  Defendants prevailed on each cause of action and had proven damages caused by the trespasses – thereby entitling them to reasonable attorney’s fees in addition to other costs.

            As to Defendants’ argument they were also entitled to contractual attorney fees under section 1717, the 1/1 DCA agreed with the trial court.  Defendants were not parties to the purchase agreement entered into between neighbor and real estate agent.  Had real estate agent prevailed, Defendant would not have been liable for fees under the contract.  There was no fee-shifting reciprocity in this case as is required under 1717.

            On remand, the appellate court instructed that the trial court is to determine the practicality of apportioning fees between Defendants’ trespass claim and other claims.

Costs, Prevailing Party, Section 998, Section 1717: Trial Court Order Denying All Attorney’s Fees And Costs To Defendants Reversed On Appeal

Defendants Will Be Entitled To Substantial Fees/Costs On Remand, Not To Mention An Attempt To Garner Even More Fees.

            This next case is a very substantial reverse of fortune on appeal.  So, that takes us to posting on Abregov v. Lawrence, Case No. G056866 (Abregov II) (4^th Dist., Div. 3 Mar. 19, 2020) (unpublished).

            Plaintiffs sued several defendants for alleged breaches of the parties’ shareholder agreements and fiduciary duties, contractual and tort in nature.  Defendants cross-claimed.  Eventually, after a two-phased bench trial, plaintiffs recovered nothing, and defendants obtained some relief on their cross-complaint in the form of a declaration that a company was not a statutory close corporation.

            Defendants then sought $626,341.65 in costs ($472,380.81 of which were expert witness/fees and costs) after plaintiffs rejected a CCP § 998 offer.  Because there was a prevailing party contractual clause in the shareholder agreement, defendant also moved for almost $8.3 million in attorney’s fees under Civil Code section 1717 and/or CCP § 998.  This, of course, prompted motions to tax or strike costs and vigorous opposition to the fee request.

            Although the judgment contained a provision that defendants prevailed, the trial judge believed he had been “snookered” into so finding, ultimately denying the defense postjudgment motions for costs and attorney’s fees and not addressing the defense request for 998 costs.

            Routine Costs.  The trial court erred on this issue.  Defendants did obtain relief on the cross-complaint such that they were prevailing parties entitled to litigation costs as a matter of right.  (CCP § 1032(b); Zintel Holdings, LLC v. McLean, 209 Cal.App.4^th 431, 438 (2012).). So, a remand was in order so that specific costs items could be reviewed under plaintiffs’ motion to tax costs.

            Section 998 Costs.  Given that section 998 allows for broader costs such postoffer attorney’s fees if based on a contract and expert witness fees, the appellate court next reviewed defendants’ offer to settle the complaint for $500,000 in exchange for a dismissal with prejudice “of all claims Plaintiff has asserted against the Offeror Defendants in the above-captioned action,” with all parties being their costs/fees.  In this area, section 998 allows fees, as long as there is a contractual basis (and there was here), even in the absence of a prevailing party determination as long as the judgment was more favorable than the statutory offer (which it was).  (Scott Co. v. Blount, Inc., 20 Cal.4^th 1103, 1114 (1999).).  The “all claims” language in the 998 offer did not invalidate it because only involved the claims in the complaint, not asking for broader releases or a release of non-alleged claims.  (One Star, Inc. v. STAAR Surgical Co., 179 Cal.App.4^th 1082, 1096 (2009).). Because plaintiffs failed to obtain a more favorable judgment, the defense was entitled to 998 postoffer costs and reasonable attorney’s fees.

            Section 1717 Fees.  Defendants did prevail under the shareholder agreement fees clause such that the fee denial on this basis was reversed.  The appellate court decided that a voluntary cancellation of shares did not tarnish this conclusion (although the trial judge believed otherwise) because the defense achieved a “lopsided” victory on all of plaintiffs’ claims.  However, the lower court on remand needed to determine if the fees clause was broad enough to cover fee recovery on noncontract causes of action.  (Brown Bark III, L.P. v. Haver, 219 Cal.App.4^th 809, 818 (2013).)

            Assigned Justice Dunning, a retired judge of the Orange County Superior Court, penned the 3-0 opinion.

Choice of Law, Estoppel, Intellectual Property: Attorney’s Fees Properly Denied In Entirety To Plaintiff Winning Only 7.89% Of Total Damages, After Apportionment, In Copyright Infringement Suit

Fee Recovery Barred By Judicial Estoppel—Plaintiff Classified Claims In Tort, Not Contract, Such That No Fee Recovery Allowable Under Either California Or Texas Laws.

            This next case does demonstrate the complexity that our state appellate courts have to wade through, even in unpublished opinions, to adjudicate appeals from fee awards where conflicting state laws may be at issue.  Brighton Collectibles, Inc. v. AIF Corp., Case No. B289327 (2d Dist., Div.8 Mar. 18, 2020) (unpublished) is just such a case.

            In this one, plaintiff asserted claims for breach of the warranty of infringement in copyright matters against defendant, winning a $1.267 million verdict which was reduced substantially through an apportionment of fault to multiplier suppliers making prior settlements.  In the end, plaintiff only garnered a positive damages recovery of a little under $100,000, 7.89% of the total recovery.

            Plaintiff moved for attorney’s fees (the amount was not specified in the opinion), but the trial judge denied them in entirety.  This prompted plaintiff to appeal both the merits and fee denial.  Both were unsuccessful.

            The fee denial was affirmed on judicial estoppel principles.  Although there was a conflict of law issue (did California or Texas law govern), it did not matter in the end.  Plaintiff had taken the position that the claims were in tort, not contract, winning a denial of a summary judgment motion on that basis.  Given that tort claims did not give rise to fee recovery under either California or Texas law, that cemented the correctness of the fee denial by the lower court.

Eminent Domain, POOF!: Reversal Of $328,000 Inverse Condemnation Merits Judgment Meant That $529,540.40 Fees/Costs Award Against City Of San Diego Went POOF!

Merits Reversal Hinged On City Not Bearing Responsibility For Private Pipeline Non-Maintenance Where City Refused A Public Dedication Offer.

            In Ruiz v. County of San Diego, Case No. D074654 (4th Dist., Div. 1 March 17, 2020) (unpublished), Plaintiff homeowners obtained a $328,000 inverse condemnation award against the County of San Diego when their privately-owned underground storm drain pipe rusted out over 50 years of use.  The trial judge, who entered the merits award, subsequently awarded plaintiffs $529,540.50 in attorney’s fees and costs under CCP § 1036, the inverse condemnation fee-shifting statute which can benefit plaintiffs.

            Well, everything went POOF! on appeal.  The 4/2 DCA decided that the merits judgment was infirm based on the city refusing a prior public dedication offer such that it had no maintenance or control over plaintiffs’ private pipeline.  Much to their chagrin, plaintiffs also lost their fee/costs recovery—a reversal of fortune on appeal. 

            BLOG OBSERVATION—We bloggers will note that appeals by governmental authorities do seem to result in a higher reversal rate than non-governmental appeals, sometimes involving a reversal as a matter of law or a modification, which obviously impacts the adverse fee/costs recovery greatly—they go away completely or are remanded for a redetermination based on the modification on appeal.

Private Attorney General: Save the Agoura Cornell Knoll Opinion Now Published.

Opinion Dealt with Private Attorney General Issues.

            On February 26, 2020, we posted on the February 24 unpublished decision in Save the Agoura Cornell Knoll v. City of Agoura Hills, Case No. B292246 (2d Dist., Div. 7).  We can now report that it was certified for publication on March 17, 2020.  The decision held that the failure to serve the Attorney General with a CCP § 1021.5 fee motion was not fatal to a fee award and that a litigant actively participating in the litigation could be held liable, akin to a real party for a 1021.5 fee recovery.

Equity, Prevailing Party: $2.41 Million Trial Court Fee Award Affirmed But $125,473.60 Appellate Fee Award Reversed

Trial Court Fee Withstood Because Good Faith Settlement With One Defendant Did Not Offset Jury Award Against Another Defendant.

            In Campos v. Kennedy, Case No. B293745 (2d Dist., Div. 2 Mar. 17, 2020) (unpublished), a sexual assault case with very bad facts, the appellate court considered a $2.41 million fees award to the prevailing party on remand and a $125,473.60 by plaintiff for fees incurred in a prior appeal.  The 2/2 DCA decided trial court fees stood up, but it reversed the appellate fee award.

            Defendant argued that plaintiff did not prevail because there was a settlement with a co-defendant which was an offset from the jury verdict against defendant, such that plaintiff did not prevail.  Nope.  There were separate and distinct wrongs committed by the two sets of defendants.  Once that was recognized, no offset was justified, plaintiff prevailed, and the $2.4 million-plus trial court fee award was sustained.

            Different matter as to the appellate fee award.  The appellate court, construing its earlier opinion, found that plaintiff did not prevail on the prior appeal—meaning the $125,473.60 appellate fee award went POOF!

Private Attorney General: 1/5 DCA Reverses And Remands Section 1021.5 Fee Award Of $265,783.90 To CEQA Plaintiff For Reconsideration After Legislature Passed Bill That Vacated Plaintiff’s Mandamus Petition Win

Plaintiff’s Hope For A Fees Award Now Depends On Prevailing Party Determination Under A “Catalyst Theory.”

            This next case includes an interesting discussion of fee recovery under a catalyst theory – a factual basis for fee recovery where a plaintiff may be considered a prevailing party by achieving its litigation objectives through the defendant’s voluntary change in conduct in response to the litigation itself as opposed to the final judgment.

            In Coast Action Group v. California State Board of Forestry etc., Case No. A157133 (1^st Dist., Div. 5 March 16, 2020) (unpublished), CEQA plaintiff filed a successful writ petition challenging the California State Board of Forestry and Fire Protection’s approval of regulations Plaintiff alleged violated the Forest Practice Act. 

            However, the trial court vacated judgment and peremptory writ of mandate upon previous remand after Legislature passed a bill that essentially invalidated the basis for the trial court’s previous order granting the writ.  Meanwhile, and despite passage of the bill, the trial court awarded Plaintiff $265,783.90 in Code Civ. Proc. section 1021.5 fees.

            On appeal, the 1/5 DCA agreed with Defendant – that Plaintiff was not a prevailing party in light of the final outcome of the litigation as it had failed to obtain judicially sanctioned relief.  But in an interesting twist, the 1/5 DCA reversed and remanded for redetermination to Plaintiff’s prevailing party status and fee entitlement under the catalyst theory.

Costs: Deposition, Witness Appearance, Official Court Reporter, And Exhibit Routine Costs Awarded For Trial Efforts Affirmed On Appeal

Multiple Challenges Rejected By Appellate Court.

            In Arambula v. Irvine Unified School Dist., Case No. G057396 (4^th Dist., Div. 3 Mar. 16, 2020) (unpublished), a trial court loser recovering nothing decided they should challenge very routine costs which were awarded by the trial court.  Bad move.

            Appellant challenged deposition costs for the defense to take plaintiff’s deposition.  The challenge to this was far from persuasive—“[a]ppellant has not cited any case where allowing the costs of taking the deposition of the opposing party was found to be an abuse of discretion.”

            Next up was a challenge to a $37.64 witness fee, but the problem was that the costs memorandum and subsequent papers supported it as prima facie proper.

            Then, a challenge to an official court reporter fee for trial court proceedings.  Although appellant did get a prior fee waiver, this simply meant he did not have to pay upfront, but this did not excuse him from having to pay the opposite side’s reporter costs after that party prevailed at the trial court level. 

            We then go to the awarded costs of $53.20 in discretionary trial exhibit costs.  Even though some of these exhibits were not used because the court granted a judgment on the pleadings, the defense could not foresee this result such that the expenses were necessary trial preparation expenses. 

            Finally, the “pocketbook” defense—I do not have an ability to pay.  This did not resonate given that appellant litigated quite actively for over two years and then appealed.  No abuse of discretion under the facts, with the lower court’s costs award affirmed in toto.  Acting Presiding Justice Moore authored the 3-0 opinion.

Probate, Section 1717: Attorney’s Fee Award Of $172,885 Affirmed Against Attorney/Law Firm Who Assisted Free-Lance Paralegal In Converting, To Free-Lance Paralegal’s Benefit, The Inheritance Of A Vulnerable, Impoverished, Paraplegic Beneficiary

The Trial Court Properly Awarded The Fees Pursuant to Civil Code Section 1717 Based On Provisions In The Escrow Agreement Drafted By Attorney/Law Firm Even Though That Agreement Was Determined By The Trial Court To Be Invalid.

            The 2/8 DCA described this next case as being “prompted by a sordid chain of events,” and we couldn’t agree more.

            Plaintiff in Revell v. Burlison Law Group, Case No. B289582 (2d Dist., Div. 8 March 13, 2020) (unpublished) is a vulnerable and impoverished paraplegic who is confined to a wheel chair due to a previous car accident.  Her mother and uncle were the primary beneficiaries, in equal shares, to her late grandmother’s trust – which included a Buena Park property.  Plaintiff was unaware of the existence of her grandmother’s trust, but knew that her mother had some interest in the Buena Park property. 

            When Plaintiff’s mother passed away, she – as sole heir to her mother’s estate – sought assistance in locating any assets in her mother’s name and in preparing documents to claim death benefits from her mother’s pension plan, and ended up signing a power of attorney with Free-Lance “Paralegal,” Bret Lovett to act on her behalf.  Lovett had a working relationship with attorney Robert C. Burlison, Jr. and his law firm Burlison Law Group, and also shared office space with the attorney/law firm.

            About a month after signing the POA, Plaintiff notified Lovett by phone that she was revoking the POA.  She then obtained the benefits she sought from her mother’s pension plan by contacting the plan directly.  Meanwhile, Lovett had learned of the Buena Park property, and – through misleading and forged letters – caused Plaintiff’s uncle to sell the property and deliver the $114,646.01 in proceeds to one of Lovett’s companies.  Lovett then got Burlison to create an escrow account to hold the funds.  The escrow agreement drafted by Burlison was signed by Burlison and Lovett – using the revoked POA.  After the $114,646.01 was transferred to the escrow account, Burlison disbursed $96,474.32 to Lovett and $1,146.46 to the Burlison Law Firm.  These disbursements were not authorized by Plaintiff, and left a balance of only $17,025.23 of Plaintiff’s inheritance funds in the so-called escrow account.

            When Plaintiff learned from her uncle that proceeds meant for her had been sent to Lovett, she demanded an accounting and disbursement of her funds.  Burlison/Burlison Law Group refused to disburse the remaining funds to Plaintiff unless she signed a release for the prior distributions – forcing her to sue to recoup her inheritance.

            The trial court found that Lovett and Burlison/Burlison Law Group had acted in concert to convert Plaintiff’s inheritance funds for the sole benefit of Lovett, and had each breached their fiduciary duty to Plaintiff.  Plaintiff was awarded $114,646.01 in compensatory damages, $229,292.02 in double damages, and $172,885 in section 1717 contractual attorneys’ fees – jointly and severally against Lovett, Burlison and Burlison Law Group – although the trial court had also determined the escrow agreement to be invalid.  Burlison and Burlison Law Group appealed.

            The 2/8 DCA affirmed the trial court’s ruling, but found the Statement of Decision and Judgment ambiguous as to whether the trial court found that Burlison and Burlison Law Group acted in bad faith for the purposes of determining liability for double damages under Probate Code section 4231.5.  The case was remanded as to this issue only – to allow the trial court to supplement its statement of decision as to whether Burlison/Burlison Law Group acted in bad faith.

            In finding the trial court had properly issued attorneys’ fees pursuant to section 1717, based on the attorney fee provision contained in the escrow agreement, and despite its finding that the escrow agreement was invalid, the 2/8 DCA cited PLCM Group, Inc. v. Drexler (2000) 22 Cal.4^th 1084, 1094-1095 [no. 1 on our list of leading cases], which provides the factors to be considered in setting a reasonable award  to a prevailing party – even if the prevailing party is successful in proving that the underlying contract is inapplicable, invalid, unenforceable or nonexistent. Santisas v. Goodin (1998) 17 Cal.4^th 599, 611 [no. 6 on our list of leading cases].

            BLOG NOTE:  For those of you who are curious to know more about the paralegal and attorney defendants in this case, the L.A. Times published an article on November 2, 2017 stating both had been arrested for involvement in a $1.2 million fraud scheme.  Also, according to the California State Bar website, Burlison was disbarred as of August 10, 2019.

Private Attorney General: Canyon Crest Conservancy Opinion Now Published

CUP/Oak Tree Dispute Only Producing Non-Merits Administrative Stay Did Not Qualify For CCP § 1021.5 Fees. 

            On February 20, 2020, we posted on Canyon Crest Conservancy v. County of Los Angeles (Kuhn), Case No. B290379 (2d Dist., Div. 4 Feb. 19, 2020), unpublished at the time.  We can now report that it was published on March 12, 2020.

            Plaintiff won a non-merits administrative stay under CEQA, but the county complied with vacating the permit approvals, and plaintiff dismissed the case.  The 2/4 DCA agreed with the trial judge that no private attorney general award was warranted because no public interest was involved based on a “status quo” administrative stay and because no significant benefit was conferred on a large class of individuals in light of the private interest involved on the part of plaintiff. 

Special Fee Shifting Statute: Attorney General Winning Charitable Trust Fiduciary Breach Action Was Entitled To Recovery Of $1,654,083.65 In Attorney’s Fees And Costs Against Trustee

Government Code Section 12598(b) Is Fee Entitlement Provision, With No Need To Gauge Success With Respect To Recovery.

            Government Code section 12598(b) allows the California Attorney General to recover (mandatory) from defendants named in a charitable trust enforcement action all reasonable attorney’s fees and costs incurred in conducting the action, with some discretion allowed as far as who pays in subdivision (c).

            This provision was the subject of a published decision, as far as interpreting its scope, in People ex rel. Becerra v. Shine, Case No. A155903 (1^st Dist., Div. 5 Mar. 11, 2020) (partially published). 

            AG won an action against a charitable trust trustee for fiduciary duty breaches to the tune of $1,421,598.  Later, AG sought to recovery section 12598(b) fees and costs of $1,929,757.50 against the trustee, with the lower court awarding $1,654,083.65 instead. 

            That award was affirmed on appeal.

            Trustee argued that the fee award had to be reduced because the scorecard was this:  trustee won on 12 claims while the People won 7, notwithstanding that the AG succeeded in removing trustee.  So, results and limited success had to be factored into the fee-shifting equation.  Wrong!  This was a very different fee-shifting provision such that the AG did not have to be a “successful party” under a private attorney general statute rubric and with the limited success only going to the reasonableness of amount of fees awarded.  No abuse of discretion as to the results reached by the trial judge, who did reduce the fee request in a reasonable exercise of discretion. 

Costs, Employment, Prevailing Party: $3,881.39 In Routine Costs, Out Of A Requested $38,813.96, To A Prevailing Wage Claim Plaintiff Was No Abuse Of Discretion

Reason Was That Plaintiff Only Had Limited Success, So No Abuse Of Discretion In The Reduction By The Lower Court.

            So, a plaintiff prevails on a wage/hour claim for unpaid wages under Labor Code section 218.5, but only gets a minimal award which was limited success when other claims are considered?  Does that plaintiff get full requested costs as the prevailing party?  Answer:  Of course not, not automatically.

            Pak v. Joo, Case Nos. G055470/G055978 (4^th Dist., Div. 3 Mar. 11, 2020) (unpublished) illustrates this point well.

            There, plaintiff appealed from a 10% routine costs award of $3,881.39 out of a requested $38,813.96, when she recovered only $12,500 on a Labor Code section 218.5 unpaid wage claim in a lawsuit seeking much, much more.  That award was affirmed on appeal.  Plaintiff only obtained limited success of her litigation objectives as a whole, such that the trial judge had discretion to reduce prevailing party routine costs based on this end result.  (Sharif v. Mehusa, Inc., 241 Cal.App.4^th 185, 192, 195 (2015).).