Reverse POOF!: Losing Homeowners, After Modification On Appeal, Are Entitled To Pursue Recovery Of Court Costs As Prevailing Parties

 

Fifth District Determines Unlicensed Contractors May Not Offset Reimbursement/Disgorgement Claims Under Unlicensed Contractors Law.

     Here is a spin on our category POOF!, where a reversal usually means a fee/costs award goes away for the time being. This next case is a reverse POOF!, where a denial of a costs award was reversed and the winning party on appeal gets to pursue recovery of costs for prevailing as a matter of law through an appellate modification of the judgment. In other words, reverse POOF!—costs award now in play on remand.

     White v. Cridlebaugh, Case No. F053843 (5^th Dist. Oct. 20, 2009) (certified for partial publication) is must reading for any litigants involved in cases with a reimbursement/disgorgement claim against unlicensed contractors under Business and Professions Code section 7031(b). It held that unlicensed contractors cannot obtain offsets for materials and services actually provided in reimbursement claim litigation.

     For our purposes, the trial court granted JNOV on homeowners’ reimbursement claim against an unlicensed contractor, a determination that was undone when the appellate court modified the judgment to allow the award to homeowners. It also ordered that homeowners were the prevailing parties for purposes of routine costs, which the trial court denied to either side. Based on claims in trial court proceedings, homeowners will now seek to recoup costs totaling $7,764.10 (in addition to their $84,621.45 disgorgement award). Reverse POOF!

Watching the Dice in Las Vegas.  Farm Security Administration - Office of War Information Photograph Collection.  March, 1940.  Arthur Rothstein, photographer.  Library of Congress.