Costs: Where Both Plaintiff And Cross-Complainant Did Not Prevail, CCP § 1032 Required An Award Of Winning Costs To the Successful Defendant

However, Appellate Court Strongly Suggested That Attorney’s Fees Were Not Automatic, Given The Lower Court Can Find No One Prevailed—Fee Standard Is Different.

            In The Real Estate Store v. Michel, Case No. B301771 (2d Dist., Div. 3 July 8, 2020) (unpublished), defendant obtained a reversal of a “each side bears its own costs and fees” ruling, where routine costs had to be awarded to the defense.  However, the appellate panel strongly suggested that a fee award was not automatic because the lower court employs a discretionary standard when there are mixed results as far as determining who is the prevailing side.

            Here, a jury returned a verdict in favor of defendant on a complaint and in favor of the cross-defendant on defendant’s cross-complaint.  The lower court ruled that each side was to bear its own costs and fees, prompting an appeal by the defense.

            The 2/4 DCA reversed, determining routine costs were mandatory.  Numerous cases confirmed that CCP § 1032(a)(4) required an award of such costs to a defendant in a situation where neither the plaintiff nor the cross-complainant obtained any relief.  (McLarand, Vasquez & Partners, Inc. v. Downey Savings & Loan Assn., 231 Cal.App.3d 1450, 1453-1455 (1991); Zintel Holdings, LLC v. McLean, 209 Cal.App.4^th 431, 438-440 (2012); Cussler v. Crusader Entertainment, LLC, 212 Cal.App.4^th 356, 370-372 (2012); Schrader v. Neville, 34 Cal.2d 112, 113-115 (1949).)  However, on remand, a fee award was not automatic because the routine costs standard for a “prevailing party” is not determinative, because Civil Code section 1717 allows the trial judge to determine no side prevailed especially in a “mixed results” scenario.