Landlord-Tenant, Reasonableness Of Fees, Section 1717: $428,175 Fee Award To Winning Landlord In Tort Condo Damages/Fraud Case Against Tenants Affirmed On Appeal

Residential Security Deposit Scheme Did Not Preempt Tort Fee Award; But Landlord Correctly Reduced Landlord’s Fee Request Of $659,367.56 For Various Reasons

            Los Angeles County Superior Court Judge Weingart, sitting by assignment on the 2/1 DCA, has penned a nice decision in Sweeney v. Scully, Case No. B284915 (2d Dist., Div. 1 June 27, 2019) (unpublished) where a landlord won tort damages against a tenant for condominium damages, but was granted a scaled-back fee award based on inefficiencies, duplication, and block billing.

            In this one, tenants sued for return of a $60,000 security deposit for renting a luxury oceanfront condominium, with landlord cross-claiming for tort damages relating to misrepresentations about past tenancies and use of a so-called service dog.  Landlord prevailed, awarded $287,581.75 in construction, loss-of-use, moving/storage, and furnishings damages by a jury.  Landlord then moved for contractual attorney’s fees of $659,367.56, but the lower court awarded $428,175.  This prompted an appeal by both sides, with the award affirmed on appeal.

            Tenant principally argued that Civil Code section 1950.5, the residential landlord security deposit scheme, preempted any tort claim award in landlord’s favor.  The appellate court disagreed, determining that nothing in the security deposit statutory language barred tort claims or provided an exclusive measure of damages for any dispute after a lease terminates.

The tort claims did give rise to fee entitlement under a broadly-worded lease fees provision.

            That brought the 2/1 DCA to landlord’s appeal for more fees than awarded by the lower court.  The problem here was that the record indeed showed the following:  (1) inefficiencies in the form of two partners at trial and even the jury complaining about the excessively slow examinations by landlords’ attorneys at trial (Rey v. Madera Unified School Dist., 203 Cal.App.4^th 1223, 1244 (2012)) ; (2) tenants’ counsel expended 890 hours versus landlord’s counsel’s 1,300 billable hours, with the comparative analysis of each side’s litigation costs being a check on the reasonableness of a fee request (Donahue v. Donahue, 182 Cal.App.4^th 259, 272 (2010)); and (3) reduction for  blockbilled fee submissions which had the effect of making it difficult to determine fee compensability of certain entries (In re Marriage of Nassimi, 3 Cal.App.5^th 667, 695 (2016); Christian Research Institute v. Alnor, 165 Cal.App.4^th 1315, 1320, 1325 (2008)).  So, the lower court’s reductions were no abuse of discretion.