. . . However, Remand For Fee Recovery Evaluation on Dismissed Tort Claim.
For you folks entertaining voluntarily dismissals of actions, must reading in this area--if you are bothered about attorney’s fees exposure--is our state supreme court’s decision in Santisas v. Goodin, 17 Cal.4th 599, 602, 607-608 (1998) [one of our Leading Cases]. We don’t hide the ball on this blog, so it basically means that a voluntary dismissal cuts off fee exposure on contractual claims but that exposure might remain for non-contract claims depending on the breadth of the fees clause. (Yep, a lot to take in, but it is the law). Santisas principles were at play in the next case.
G&B Development Co., LLC v. MKA Cabazon Partnership, LP, Case No. E049570 (4th Dist., Div. 2 Mar. 23, 2011) (unpublished) is a situation where a trial court denied postjudgment fees under Civil Code section 1717 after a court’s OSC hearing to dismiss for failure to prosecute where the parties agreed upon a dismissal of an entire action if the dismissal included both plaintiff’s complaint and defendant’s cross-complaint. Defendant was dismayed in not obtaining an award of fees, and appealed.
Result: partial success on appeal.
Santisas justified the denial of fees on the contractually-based claims because, after all, both plaintiff and defendant agreed to the overall dismissal. A dismissal based on consent of the parties is a voluntary dismissal, with Civil Code section 1717(b)(2) precluding defendant from recovering fees on the contract claims.
However, quite the different matter on a breach-of-fiduciary duty tort claim. The operative fees clause was broad enough to encompass this, such that the denial had to be reversed for purposes of awarding some fees after allowing the lower court an ability to apportion or make other adjustments.
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