Arbitration Award Reinstated, Which Meant Substance of Attorney’s Fees Award Not Reviewable Absent Trial De Novo Request.
Here is one of the first decisions we have summarized dealing with a fee award in a judicial arbitration award which became binding after plaintiffs dismissed a complaint without prejudice after filing a trial de novo request. The impact was that the arbitration award was reinstated, and the substance of the fee award was not reviewable (although the appellate court decided it was correct substantively, too).
Lee v. Kwong, Case No. A126027/A126670 (1st Dist., Div. 5 Mar. 29, 2011) (certified for partial publication; fee discussion not published) was a situation where plaintiffs suffered an unfavorable judicial arbitration award, complete with adverse fee orders of about $35,000 each in favor of different defendant groups, and filed a trial de novo request, only to later voluntarily dismiss the complaint without prejudice. The defense moved to reinstate the arbitration award, complete with the fee award--a request that was granted. Plaintiffs separately appealed the merits and fee components of the award.
The appellate court affirmed both.
With respect to the fee award, it is okay to separately appeal it, but the substance of the decision was not appealable because plaintiffs’ remedy was to seek a trial de novo on the fee award, which was not done. (Kelley v. Bredelis, 45 Cal.App.4th 1819, 1832 (1996).) However, the award was also proper under Civil Code section 1717(a). Because plaintiffs sued for specific performance on the contract and alleged that nonsignatory defendant stood in the shoes of the seller, plaintiffs would have been entitled to attorney’s fees against defendant had they prevailed such that reciprocity principles meant plaintiffs also faced fee exposure. (Reynolds Metals Co. v. Alperson, 25 Cal.3d 124, 128-129 (1979); Sessions Payroll Management, Inc. v. Noble Construction Co., 84 Cal.App.4th 671, 674 (2000).)
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