Judge Barbara M. Scheper, Case BC633169 2022-08-30 Tentative Ruling

Judge: Barbara M. Scheper, Case: BC633169, Date: 2022-08-30 Tentative Ruling

Case Number: BC633169 Hearing Date: August 30, 2022 Dept: 30

Dept. 30

Calendar No.

Pulliam vs. HNL Automotive, Inc., et al., Case No. BC633169

Tentative Ruling re: Defendant’s Motion to Tax Costs

Defendant TD Auto Finance, LLC (TD Bank) moves for an order striking post judgment attorney’s fees and costs against it in the Memorandum of Costs filed by Plaintiff Tania Pullman (Plaintiff) on March 11, 2022. The motion is granted.

A prevailing party in litigation may recover costs, including but not limited to filing fees. (Code of Civ. Proc. §1033.5, subd. (a)(1).) Under Code of Civil Procedure section 1033.5, subdivision (c)(2), allowable costs are only recoverable if they are “reasonably necessary to the conduct of the litigation.” Even mandatory costs, when incurred unnecessarily, are subject to section 1033, subdivision (c)(2). (Perko’s Enterprises, Inc. v. RRNS Enterprises (1992) 4 Cal.App.4th 238, 245.)

The memorandum of cost is a verified statement by the party, attorney, or agent that the costs are correct and were necessarily incurred in the case. (Cal. Rules of Court, rule 3.1700(a)(1).) If the items on a verified cost bill appear proper charges, they are prima facie evidence that the costs, expenses, and services listed therein were necessarily incurred. (Oak Grove School Dist. v. City Title Ins. Co. (1963) 217 Cal.App.2d 678, 698 (Oak Grove).) “The trial court’s first determination is whether the statute expressly allows the particular item and whether it appears proper on its face; if so, the burden is on the objecting party to show the costs to be unnecessary or unreasonable.” (Foothill-DeAnza Community College Dist. v. Emerich (2007) 158 Cal.App.4th 11, 29 (Foothill-DeAnza).) The burden of showing that an item is not properly chargeable or is unreasonable is upon the party challenging the costs. (Wilson v. Nichols (1942) 55 Cal.App.2d 678, 682-683 (Wilson).)

“The judgment creditor is entitled to the reasonable and necessary costs of enforcing a judgment. Attorney’s fees incurred in enforcing a judgment are not included in costs collectible under this title unless otherwise provided by law. Attorney’s fees incurred in enforcing a judgment are included as costs collectible under this title if the underlying judgment includes an award of attorney’s fees to the judgment creditor pursuant to subparagraph (A) of paragraph (10) of subdivision (a) of Section 1033.5.” (Code Civ. Proc. § 685.040.)

On May 29, 2018, following jury trial, the Court entered judgment in favor of Plaintiff for damages, attorney’s fees, costs, and prejudgment interest, jointly and severally against Defendants TD Bank, N.A. and HNL Automotive, Inc. On October 23, 2018, Defendants appealed the order granting attorney’s fees. The Court issued a declaratory order confirming automatic stay of the attorney’s fees portion of the judgment on November 26, 2018.

The Court issued an order lifting the stay on October 9, 2019, based on Defendants’ failure to post an appeal bond. That Order reads, “The stay on enforcement of the judgment due to Defendants’ appeal is hereby conditioned on Defendants posting a bond in the amount of $339,204.00. This condition goes into effect on September 4, 2019. If a sufficient bond is not posted by September 4, 2019, the stay on enforcement is lifted.” Plaintiff subsequently began judgment enforcement activities. As of February 21, 2020, Defendant TD Bank satisfied all portions of the Judgment except for the award of attorney’s fees, which totals $169,602. (Le Decl. ¶¶ 8-10.) TD Bank later posted an appeal bond with the Court in the required amount on February 24, 2020.

TD Bank argues that Plaintiff may not be awarded post judgment fees for enforcement of the attorney’s fees portion of the judgment, arguing that it did not need to post an appeal bond to stay Plaintiff’s post-judgment enforcement action, or, alternatively, that the stay became effective following TD Bank’s posting of the appeal bond.

“The perfecting of an appeal shall not stay enforcement of the judgment or order in cases not provided for in Sections 917.1 to 917.8, inclusive, if the trial court, in its discretion, requires an undertaking and the undertaking is not given,” in cases where “[t]he judgment against appellant is solely for costs awarded to the respondent by the trial court pursuant to Chapter 6 (commencing with Section 1021) of Title 14.” (Code Civ. Proc. § 917.9, subd. (a)(3).) “The undertaking shall be in a sum fixed by the court and shall be in an amount sufficient to cover all damages which the respondent may sustain by reason of the stay in the enforcement of the judgment or order.” (Code Civ. Proc. § 917.9, subd. (b).) This section vests the trial court with discretionary authority to require an undertaking in certain situations. (See May v. May (1969) 275 Cal.App.2d 264, 281.)

The Court already determined in its Order granting Plaintiff’s Motion to Set a Bond Pending Defendants’ Appeal, issued October 9, 2019, that Defendants were required to post a bond as a condition to the automatic stay on judgment enforcement following appeal. This Order lifted the initial automatic stay following Defendants’ appeal.

Though the stay was initially lifted on October 9, 2019, the Court finds that the automatic stay became effective after TD Bank posted the bond on February 25, 2020. While Plaintiff argues that Defendants’ February 25 bond was untimely, “[t]here is no time limit for filing the bond or undertaking. It can be filed any time before execution on the judgment or order.” (Eisenberg et al., Cal. Practice Guide: Civil Appeals and Writs (2021) ¶ 7:181 [citing Bradley Co. v. Mulcrevy (1913) 166 Cal. 325, 327].) The Court’s October 9 order did not preclude the bond being posted at a later point in time.

Furthermore, Plaintiff did not file any motion objecting to the bond. Appeal bonds and undertakings are governed by the Bond and Undertaking Law, Code Civ. Proc. § 995.010 et seq. Under that chapter, an objection to a bond “shall be in writing and shall be made by noticed motion,” and “the objection shall be made within 10 days after service of a copy of the bond on the beneficiary or such other time as is required by the statute providing for the bond. (Code Civ. Proc. § 995.930, subds. (a), (b).) “If no objection is made within the time required by statute, the beneficiary is deemed to have waived all objections except upon a showing of good cause for failure to make the objection within the time required by statute or of changed circumstances.” (Code Civ. Proc. § 995.930, subd. (c).) Because Plaintiff did not timely object, Plaintiff has waived objections to the bond.

Accordingly, the Court finds that the automatic stay as to enforcement of the attorney’s fee award became effective as to TD Bank following its posting of the bond on February 25, 2020.

Plaintiff’s Memorandum of Costs After Judgment filed March 11, 2022 seeks recovery of post judgment costs including attorney’s fees in the amount of $70,400.50 incurred from March 13, 2020 to March 11, 2022, and costs in the amount of $11,426.56 pursuant to Civ. Code § 1794(d) and CCP § 685.040. Because the stay on post judgment enforcement was effective as to TD Bank during that period, those costs were not reasonably incurred. Accordingly, the Court grants the motion and strikes the costs against TD Bank in the total of $81,827.06.