Indemnity: $21,012 Fee/Costs Award Under CCP § 1038 Sustained On Appeal After 631.8 Motion Granted In Indemnity Action

Vindictive Purpose Of The Action Shown Through Emails.

            Code of Civil Procedure section 1038 provides that, where a trial court grants a defense motion for directed verdict, motion for judgment, or nonsuit in an action for indemnity and contribution, the trial court, on motion, may award attorney’s fees if the action was not brought with reasonable cause in the good faith belief that there was a justifiable controversy.  The “reasonable cause” prong is reviewed de novo, and the “good faith” prong is reviewed for substantial evidence when reviewing a lower court’s grant of fees/costs.  (Austin B. v. Escondido Union School Dist., 149 Cal.App.4^th 860, 888 (2007).)

            In Sturm v. Woods, Case No. B300572 (2d Dist., Div. 6 Oct. 21, 2020) (unpublished), plaintiff sued a paralegal who helped her oppose a summary judgment motion in a malpractice action filed against an ex-attorney (a motion eventually granted in ex-attorney’s favor).  In an email sent to the paralegal on the day she filed her action, plaintiff admitted that there was no unintentional error in the opposition papers, but that paralegal was “collateral damage” in trying to get to the ex-attorney.  The lower court granted a CCP § 631.8 motion for judgment in favor of paralegal and stated it would entertain a motion for attorney’s fees, with paralegal doing so and with the trial judge awarding $21,012 in fees and costs.

            Plaintiff’s appeal was sternly rebuffed by a 2/6 DCA panel.  The “tell-all” email satisfied the “reasonable cause” and “good faith” prongs, showing the litigation was “a vindictive action, brought in bad faith and without reasonable cause, to force paralegal to indemnify appellant.”  It was further bolstered by the “collateral damage” reference and plaintiff also indicating “I know that you are under a lot of pressure caring for your disabled husband and family.”  Ouch!