. . . On Adequate Fee Substantiation, Cost Recovery Under Civil Code Section 3334(a), And Deadlines For Submitting Amended Fee Request Information
This next case is a wild thing,
a second appeal involving litigants entangled in a subsurface trespass case where plaintiff was seeking to recover for defendant’s environmental contamination of its groundwater. In the earlier appeal, Starrh and Starrh Cotton Growers v. Aera Energy LLC, 153 Cal.App.4th 583, 606-608 (2007), the Fifth District concluded that a fee-shifting trespass statute applicable to “under cultivation” land (Code of Civil Procedure section 1021.9) would allow for fee recovery even if the trespass was subsurface in nature. Well, this case resulted in another jury verdict and claims of error, giving us more fodder to blog about. The case is Starrh and Starrh Cotton Growers v. Aera Energy LLC, Case Nos. F058778/F059660 (5th Dist. Jan. 25, 2012) (unpublished), authored by Acting Presiding Justice Wiseman on behalf of a 3-0 panel.
After the earlier appeal, plaintiff recovered a compensatory damages verdict from a jury for about $8.5 million, but the trial court denied punitive damages after the jury negatively answered a special inquiry. (This punitive damage denial was reversed in the case we are discussing, based on the lower court’s refusal to allow argument on the punitive damages request.)
Interestingly enough, the lower court--the first time around--initially denied fees to plaintiff requesting a $6.9 million award (with plaintiff’s contingency counsel relying upon reconstructed time records for the lodestar/multiplier requests) based on the erroneous premise that section 1021.9 did not apply to subsurface trespass. However, the second time around following the successful second trial, plaintiff’s counsel relied simply on the 40% contingency arrangement with its client, requesting $6.85 million. This request was denied for failure to provide lodestar information. Then, plaintiffs responded by resubmitting lodestar information, but now asking for $13.3 million (factoring in a .5 multiplier request). The trial court denied this request because it believed it lost jurisdiction when the appeal was filed on the merits judgment. Plaintiff also brought a special costs motion under Civil Code section 3334(a) requesting costs of $687,129.67 for costs of recovering possession of property under a specialized lost benefit statute aptly raised in these type of cases. The lower court denied this based on a lack of evidence. Finally, the lower court did allow plaintiff recovery of $164,424.28 out of a requested $181,563.11 in routine costs. Plaintiff appealed the fee/costs denials.
So what happened on appeal? Actually, quite simply, the appellate court agreed that the denial of the fee motion appeal was moot based on the reversal of the punitive damage award. The fee/costs issues could be considered anew on remand, but the appellate court did indicate that since the lodestar information was in the record, the lower court now could use discretion to look at the contingency or lodestar information for purposes of determining what fees should be awarded to plaintiff the next time around. With respect to the defense contention that the previous post-trial second fee motion was untimely, it expressed some strong “advisory” views that the refiled motion was timely (made 90 days rather than 60 days under the initial fee filing CRC) based on plaintiff’s attorneys’ need to reconstruct time records for a lengthy period of time. Refiled motions are guided by a more liberal reasonableness requirement rather than the strict CRC rules, the appellate panel intimated. As far as the section 3334(a) costs denial, that one would have to be reconsidered, with the appellate court providing some guidance--the most applicable being its agreement with the defense that these costs had to be “reasonable” and “necessary” in nature (incorporating these important constructs from the routine costs statutes). So, a remand is in order, and we betcha there might be a third opinion for us to blog on at some point in time.
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