Fee Clause Interpretation, Section 1717, Section 998: Overall Prevailing Party Not Entitled To Atty’s Fees On Contractual Claim Dismissed During Closing Argument, On Noncontractual Claims Under Narrow Fees Clause, Nor § 998 As Gen. Litigation Expenses

Result Was Affirmance Of $38,000 Fees Award On One Of Three Cases, But Affirming The Denial Of The Remaining $165,000 Total Request Based On Topical Analysis Above.

            Contreras v. Silla America, Inc., Case No. B283118 (2d Dist., Div. 3 July 17, 2018) (unpublished) involved a situation where a trial judge decided that an overall prevailing party was entitled to apportioned attorney’s fees of $38,000 in one of three cases, although denying the total fee request on all three cases coming to a total of about $165,000. Prevailing party—as appellant – wanted more, appealing, but he did not gain his wish.

            With respect to one case where he was a defendant, the appellant could not gain fees because the plaintiff dismissed the case during closing argument. Appellant was not happy, but the dismissal was proper because it was done before submission of the matter for decision so as to preclude fee recovery. In this respect, Division 3 agreed with the analysis of the Second District, Division 4 in Shapira v. Lifetech Resources, LLC, 22 Cal.App.5^th 429, 437 (2018) on the issue [reviewed in our April 20, 2018 post].

            However, not to give up on the Santisas point in the case where fees were denied, appellant argued that the causes of action were noncontractual in nature so as to fall outside of the contractual dismissal ban. No, that did not work. The fees provision only focused on collection actions following the buyer’s failure to pay for purchased goods, not containing any broad language to support an award of fees as it related to noncontractual claims.

            Finally, that brought everyone to the CCP § 998 argument that the rejected settlement offer allowed the offeror, like appellant, to recovery litigation expenses such as attorney’s fees. The Court of Appeal, eloquently, answered this way:   nice try. Section 998 does not provide for recovery of attorney’s fees as costs, unlike potential recovery of expert witness fees. “We are unaware of any case holding that Code of Civil Procedure section 998 authorizes a discretionary award of attorney’s fees as costs in the absence of some other statutory or contractual right to such fees.” (Slip Op., p. 14.)