Section 1717: Appellate Court Remittitur Choice To Respondent On Damages Requires Reconsideration of Fee Award

Fourth District, Division 3 Remands Fee Recovery Under Unusual Procedural Circumstances.

     Here is an interesting decision with a procedural twist—with apologies to Chubby Checker (oh, boy, are we dating ourselves).

    

Chubby Checker does the Twist.

     In Nguyen v. Dang, Case Nos. G041224/G041380 (4^th Dist., Div. 3 Mar. 11, 2010) (unpublished), a signatory of a contract with a fees clause was hit with a $71,000 damages award arising out of a radio station purchase dispute and a subsequent $99,263.40 fee award as well as $14,912.06 costs award. Appellant signatory appealed, mainly banking on the theory he was a mere assignor who never really ran the radio station. Interestingly enough, on appeal, the appellate court reversed the damages as being excessive, giving the respondent a chance to agree to a remittitur of damages down to $4,110. So, how did this impact the attorney’s fees award?

     It, too required, that the fee/costs awards had to be reversed and remanded for reconsideration, wrote Justice Ikola on behalf of a 3-0 panel in the decision.

     The appellate court had no difficulty determining that appellant, as a signatory and assignor, still had responsibility for fee recovery. After all, appellant was a surety for assignee in the performance of any obligations, bearing the benefits and the burdens. (Civ. Code, § 1457; Cutting Packing Co. v. Packers’ Exch., 86 Cal. 574, 577 (1890).) However, the potential drastic reduction in damages—if the remittitur is accepted—did require a reconsideration of the fee award under the unusual posture of this case. Although acknowledging that the fee award might be just fine and that fees do not have to be proportionate to the amount of damages recovered (Niederer v. Ferreira, 189 Cal.App.3d 1485, 1507-1508 (1987)), a remand was still in order in light of the unusual circumstances at play.