Costs/Fees As Damages: Nonspecific Expert Witness/Other Costs In Contractual Fee/Costs Provision Had To Be Pled And Then Proven Before Posttrial Stages

 

First District, Division 1 May Have Intimated Disagreement With Thrifty Payless in Recent Unpublished Decision.

     Way back in our June 23, 2010 post on Thrifty Payless, Inc. v. Mariners Mile Gateway, LLC, 185 Cal.App.4th 1050 (2010), we knew that this case would engender some further judicial feedback. It basically held that expert witness fees are available under a contractual provision expressly awarding them and that such fees could be claimed in a posttrial memorandum of costs without the necessity of pleading and proving them during the litigation. (Id. at 1065-1067.) Well, we feel vindicated in a way, because it has engendered some feedback in the recent unpublished decision of Harbison-Mahony-Higgins Builders, Inc. v. Argonaut Constructors, Case No. A131575 (1st Dist., Div. 1 Jan. 31, 2012) (unpublished).

     There, a successful subcontractor garnered an award of expert witness fees and other costs not specifically authorized by the routine costs statute, CCP § 1033.5, but did so through a posttrial costs memorandum based on an indemnification contract clause in the parties’ agreement. (Incidentally, the total fees/costs award was a little over $1 million, although appellant did not contest the fee award. However, the costs being challenged did amount to nearly $400,000.)

     On appeal, appealing contractor won a reversal on this aspect of the costs award.

     After a scholarly survey of the jurisprudence in this area, the appellate court in Harbison-Mahony-Higgins Builders concluded the trial court erred in awarding these non-section 1033.5 costs through a posttrial cost proceeding. Rather, it ruled that these expenses had to be pled and proven, suggesting in the process that (1) Thrifty Payless may have wrongly departed from existing precedent, and (2) even under Thrifty Payless, pleading and proof was required because the case before it dealt with a nonspecific costs provision (unlike the situation in Thrifty Payless, which involved a contractual provision expressly allowing for expert witness fees to be awarded).