Interpretation Of Fee Clause Wording Is A Fertile De Novo Review Issue For Losing Litigants Facing Fee Exposure.
On appeal, one of the best issues is whether there is fee entitlement. In many disputes, this means does the fee clause cover the dispute which was adjudicated before a court or jury? If the answer is no, even though a trial judge decides otherwise, an appellate court can reverse the fee award as a matter of law.
That is what happened in BFCAP Investments, LLC v. Lifehouse Parkview Properties, LLC, Case No. B307388 (2d Dist., Div. 4 Apr. 21, 2022) (unpublished). There, defendant sellers won a summary judgment against plaintiff buyer, with the trial judge awarding a full request of a little over $320,000 in attorney’s fees under a contractual fees clause. (Even then, the trial judge was concerned that the defendants failed to quote the full fees clause so that a proper consideration of the fee award could be made, with the defense apologizing at some stage for this omission.) Nonetheless, the appellate court reversed, deciding that the fees clause only related to disputes over Acquired Assets rather than property post-default issues. Even though plaintiff had prayed for fees, the reviewing court did not view this as an estoppel because defendants still had to show their own entitlement to fees.
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