Whitley Financial Analysis Adopted By Lower Court Sustained On Appeal.
In Broad Beach Geologic Hazard Abatement Dist. v. 31506 Victoria Point LLC, Case Nos. 304699 et al. (2d Dist., Div. 4 filed Aug. 2, 2022; posted Aug. 3, 2022) (published), a group of Malibu homeowners successfully prevailed in an assessment validation proceeding against District under Proposition 218, a determination affirmed on appeal. Certain homeowners then moved for attorney’s fees under California’s private attorney general statute, CCP § 1021.5, for fees totaling over $2.4 million. The lower court denied those requests, triggering an appeal by certain homeowners. The fee denial, too, was affirmed on appeal.
The principal reason for affirmance was that the homeowners’ economic benefit in the litigation exceeds their litigation costs under the cost/benefit analysis of Conservatorship of Whitley, 50 Cal.4th 1206 (2010) [our Leading Case #14]. The lower court used a formula in arriving at this determination, taking the 10-year benefit to the separate group of homeowners, discounting by 50%, and then comparing that discounted benefit number to the homeowners’ litigation costs. The appellate court saw nothing wrong with this math, as well as rejected the argument that the possibility of a future assessment was enough to justify fee awards.
BLOG HAT TIP—Matthew Kanin, who has co-counseled several appeals with co-contributor Mike Hensley, won on the merits but lost the fee battle on appeal. Hat tip just the same.
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