Conspiracy And Unjust Enrichment Claims Fell Within An Operating Agreement Contractual Dispute Ambit.
Many contractual fee disputes depend on whether the claims were “on the contract” under Civil Code section 1717; and if so, who prevailed. In Zhou v. Hotel Winters, LLC, Case No. C099278 (3d Dist. Aug. 2, 2024) (unpublished), defendants won a demurrer without leave resulting in a dismissal, a merits determination affirmed on appeal, in a case involving conspiracy and unjust enrichment claims under a broad fee dispute contractual clause. Defendants obtained a $45,000 attorney’s fees award (out of a requested $134,396.25 fee claim), although $625 hourly rates were reduced to $450 for principal attorneys. The Third District affirmed: defendants won by showing that the operating agreement was inapplicable, invalid, unenforceable, or nonexistent given that the conspiracy and unjust enrichment claims were “on the contract” under section 1717. Also, the dismissal based on the demurrer being sustained without leave was a merits determination rather than just a premature or interim victory.
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