Court of Appeal Was Not Pleased With Appellant’s Inconsistent Positions.
Judicial estoppel is an equitable doctrine aimed at preventing litigants from taking two totally inconsistent positions in different phases of litigation--or prevent “playing fast and loose” with the judicial system or “gaming the system” by taking such inconsistent positions. (Uhrich v. State Farm Fire & Cas. Co., 109 Cal.App.4th 598, 613 (2003); Rapture Shipping, Ltd. v. Allround Fuel Trading B.V., 350 F.Supp.2d 369, 373 (S.D.N.Y. 2004).) That doctrine did prevent appellant from doing that in a second appeal in an effort to avoid a substantial fee award levied after appellant lost in arbitration/post-award confirmation proceedings.
In New England Elec. Wire Corp. v. Cooner Sales Co., LLC, Case No. B231081 (2d Dist., Div. 2 Apr. 30, 2012) (unpublished), appellant--emboldened by some prior trial court wins in previous arbitration rounds and post-award enforcement proceedings--filed pleadings indicating that it was the prevailing party entitled to fees in both arbitration and post-arbitration judicial proceedings, going so far to say that the intent of the contractual fees clause was clear. Unfortunately for appellant later, the opponent became the winner after subsequent rounds and post-arbitration proceedings, with the lower court awarding opponent $804,184 in attorney’s fees plus another $44,615 for a prior meritless appeal. In the fee battle, appellant claimed that the fees clause did not cover the requested fees, something the lower court rejected.
What did appellant then do? Appealed again, iterating that there was no fee entitlement because the fees clause did not authorize any fees incurred during judicial proceedings.
The appellate court was not impressed. Applying the doctrine of judicial estoppel, it found that there was no way to square the inconsistency in positions, especially since contractual intent “exists at the time the contract is formed: it does not change from year to year. Once appellants announced their contractual intent in the first appeal, they were not free to invent an entirely inconsistent contractual intent in a later appeal.” (Slip Opn., pp. 8-9.)
But that was not all. Although affirming the fee award, the appellate court remanded to the lower court to determine the amount of fees and costs to be awarded to respondent for legal services rendered on the second appeal.
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