Costs, Prevailing Party, Section 1717: Plaintiff Tenants Obtaining CAM Credits And Monetary Settlement Were Prevailing Parties

 

They Did Get $76,000 In Fees And $16,961 In Costs, But Not Anything More—Plaintiffs’ Behavior In Settlement Negotiations Found To Be Irrelevant For Fixing 1717 Fees.

     Some of the gnarly cases involve those where there is no “unqualified winner” under Civil Code section 1717 as far as fees (although a winner for routine costs). The trial judge gets to decide, much to the chagrin of the losing party and maybe the winning side if the fee award is not high enough.

     Nguyen v. JMK Investments, Inc., Case No. H040901 (6^th Dist. June 30, 2015) (unpublished) illustrates how “cognitive dissonance” can operate in the fee area.

     Plaintiff shopping center tenants sued a shopping center manager regarding excessive management and landscaping fees, with the parties settling under an arrangement by which plaintiffs obtained certain credits and moneys with the trial court to resolve which side was entitled to attorney’s fees and costs. (There was a lease fees clause at play.) After requesting about $129,000 in fees and $20,000 in costs, plaintiffs were awarded $76,000 in fees and $16,961 in costs. Both sides appealed, defendant saying “no way” on fees or awarded amount, and plaintiffs saying “not enough.”

     Both sides went away discontent on appeal.

     Plaintiffs did prevail as to routine costs given that they were paid $22,500 for monetary damages on excessive CAM charge claims. Nothing showed that the costs claimed were unreasonable or unnecessary. With respect to expert fees, the Sixth District found the trial judge had authority to award expert fees as costs under a lease clause without the necessity to prove as damages at a trial. (Thrifty Payless, Inc. v. Mariners Mile Gateway, LLC, 185 Cal.App.4^th 1050, 1066 (2010).)

     Plaintiffs also prevailed for purposes of a Civil Code section 1717 fee award, given there was a lease fees clause. After all, plaintiffs obtained some money, got an audit of CAM expenses, and eliminated some improper landscaping charges—enough to prevail. Although the defense argued that plaintiffs’ behavior in settlement negotiations should be considered, the Sixth District considered it irrelevant for 1717 purposes.

     Finally, the trial court did not abuse its discretion in reducing the fee request, as far as making an award, with respect to plaintiffs.