Judge: Christopher K. Lui, Case: 21STCV07779, Date: 2025-05-29 Tentative Ruling
Case Number: 21STCV07779 Hearing Date: May 29, 2025 Dept: 76
The following
tentative ruling is issued pursuant to Rule of Court 3.1308 at 1:55 PM on May 28, 2025.
Notice of intent
to appear is REQUIRED pursuant to California Rule of Court 3.1308(a)(1). The Court does not desire oral argument on
the motion addressed herein.
As required by
Rule 3.1308(a)(1), any party seeking oral argument must notify ALL OTHER
PARTIES and the staff of Department 76 by 4:00 p.m. on May 28, 2025.
Notice to Department 76 should be sent by
email to smcdept76@lacourt.org, with
opposing parties copied on the email. The
high volume of telephone calls to Department 76 may delay the Court’s receipt
of notice, so telephonic notice to 213-830-0776 should be reserved for
situations where parties are unable to give notice by email.
Per Rule of Court
3.1308, the Court may not entertain oral argument if notice of intention to
appear is not given.
Plaintiff alleges that the seller Defendants misrepresented the square footage of the subject property. Plaintiff alleges that the lender Defendants failed to inform Plaintiff that financing was contingent upon the property’s final appraisal report, which caused Plaintiff to make deposits, inspections and removal of contingencies, and the seller Defendants have refused to release Plaintiff’s earnest money deposit from escrow.
The seller Defendants filed a Cross-Complaint alleging that Plaintiff breached the agreement to purchase the real property.
Defendants Milkshake Media Corporation and Meredith Marshall moves for an award of attorney’s fees.
TENTATIVE RULING
Defendants Milkshake Media Corporation and Meredith Marshall’s motion for attorney’s fees is GRANTED in the reduced amount of $62,500.
ANALYSIS
Motion For Attorneys’ Fees
Discussion
Defendants Milkshake Media Corporation and Meredith Marshall moves for an award of attorney’s fees pursuant to Civil Code, § 1717 and the prevailing part fee clause in the Residential Purchase Agreement.
In the Opposition, Plaintiff argues that Defendants did not properly notice the issue of determination of a prevailing party, and thus, the motion for attorney’s fees cannot be granted.
However, in the Notice of Motion, Defendants do address the prevailing party concept—albeit briefly—in assuming they are the prevailing party because:
Milkshake prevailed on the dueling contract claims. After a three-day trial, the Court ruled that Oquarium breached the RP A, and that Milkshake is entitled to the $48,000 deposit as liquidated damages. The Court also rejected the fraud claims that Oquarium brought against Milkshake and its owner, Ms. Marshall.
(Notice of Motion, Page 2:9-13.)
Defendants also
state: “And there is no dispute that the Milkshake Parties prevailed. They won on
every claim the parties litigated at trial.” (Motion, Page 3:15-16.) While Plaintiff
spends much time arguing that the prevailing party issue was not properly noticed,
Plaintiff does not persuasively argue why Defendants would not be considered the
prevailing party at trial. Indeed, the judgment is in favor of Defendants/Cross-Complainants
and against Plaintiff/Cross-Defendant as to each cause of action. The judgment also
awarded Defendants Milkshake Media Corporation and Meredith Marshall the $48,000
earnest money deposit that remains in escrow, as being co-extensive with Defendants’
damages for their cross-claim for breach of contract. (Judgment, Page 2:27 – 3:4.)
The Court also state that it “will defer deciding who prevailed in this case until
a motion for attorneys’ fees has been filed, per the Rules of Court.” (Judgment,
¶ 7.) The motion for attorneys’ fees having been filed, the prevailing party determination
is properly before the Court.
Civil Code,
§ 1717 provides in pertinent part as follows:
(a) In any action on a contract, where the
contract specifically provides that attorney’s fees and costs, which are incurred
to enforce that contract, shall be awarded either to one of the parties or to the
prevailing party, then the party who is determined to be the party prevailing on
the contract, whether he or she is the party specified in the contract or not, shall
be entitled to reasonable attorney’s fees in addition to other costs.
Where a contract provides for attorney’s
fees, as set forth above, that provision shall be construed as applying to the entire
contract, unless each party was represented by counsel in the negotiation and execution
of the contract, and the fact of that representation is specified in the contract.
Reasonable attorney’s fees shall be fixed
by the court, and shall be an element of the costs of suit.
. . .
(b)
(1) The court, upon notice and motion by
a party, shall determine who is the party prevailing on the contract for purposes
of this section, whether or not the suit proceeds to final judgment. Except as provided
in paragraph (2)[where the action has been voluntarily dismissed or dismissed pursuant
to a settlement], the party prevailing on the contract shall be the party who
recovered a greater relief in the action on the contract. The court may
also determine that there is no party prevailing on the contract for purposes of
this section.
(Civ. Proc. Code, § 1717(a) & (b)(1)[bold
emphasis and underlining added].)
Here, Defendants
were the party who recovered a greater relief on their cross-claim for breach of
contract, i.e., $48,000, whereas Plaintiff recovered no damages. The Court finds
that Defendants are the prevailing party for purposes of an award of attorney’s
fees pursuant to Civil Code, § 1717 and ¶ 25 of the Residential Purchase Agreement,
which states:
25. ATTORNEY FEES: In any action, proceeding,
or arbitration between Buyer and Seller arising out of this Agreement. the prevailing
Buyer or Seller shall be entitled to reasonable attorney fees and costs from the
non-prevailing Buyer or Seller, except as provided in paragraph 22A. ¶ 22.A provides
in pertinent part:
If, for any dispute or claim to which
this paragraph applies, any Party (i) commences an action without first attempting
to resolve the matter through mediation, or (ii) before commencement of an action,
refuses to mediate after a request has been made, then that Party shall not be entitled
to recover attorney fees, even if they would otherwise be available to that Party
in any such action.
(Bold emphasis added.)
Because
Defendants did not “commence this action,” they are not subject to ¶ 22.A waiver
of attorney’s fees. Further, Civil Code, § 1717(a) provides that any such waiver
is void.
As
such, the Court finds that Defendants Milkshake Media
Corporation and Meredith Marshall are the prevailing party entitled to recover reasonable
attorney’s fees.
The determination
of reasonable amount of attorney fees is within the sound discretion of trial courts.
(PLCM Group v. Drexler (2000) 22 Cal.4th
1084, 1095; Akins
v. Enterprise Rent-A-Car Co. (2000) 79 Cal.
App. 4th 1127, 1134.) “The determination of what constitutes a reasonable
fee generally ‘begins with the ‘lodestar,’ i.e., the
number of hours reasonably expended multiplied by the reasonable hourly rate….’” “[T]he lodestar
is the basic fee for comparable legal services in the community; it may be adjusted
by the court based on factors including, as relevant herein, (1) the novelty and
difficulty of the questions involved, (2) the skill displayed in presenting them,
(3) the extent to which the nature of the litigation precluded other employment
by the attorneys, (4) the contingent nature of the fee award….” (Graciano
v. Robinson Ford Sales, Inc. (2006) 144 Cal.App.4th 140, 154.) In
setting the hourly rate for an attorney fees award, courts are entitled to consider
the rate of “‘fees customarily charged by that attorney and others in the community
for similar work.’” (Bihun v. AT&T Information
Systems, Inc. (1993) 13 Cal. App. 4th 976, 997 [affirming rate of $450 per hour],
overruled on other grounds by Lakin v. Watkins
Associated Indus. (1993) 6 Cal. 4th 644, 664.) The burden is on the party seeking attorney fees
to prove reasonableness of the fees. (Center
for Biological Diversity v. County of San Bernardino (2010) 188 Cal. App. 4th
603, 615.)
The Court has broad discretion in determining
the amount of a reasonable attorney’s fee award which will not be overturned absent
a “manifest abuse of discretion, a prejudicial error of law, or necessary findings
not supported by substantial evidence.” (Bernardi
v. County of Monterey (2008) 167 Cal.App.4th 1379, 1393-94.) The Court need not explain its calculation of
the amount of attorney’s fees awarded in detail; identifying the factors considered
in arriving at the amount will suffice. (Ventura
v. ABM Industries Inc. (2012) 212 Cal.App.4th 258, 274-75.)
The Court has reviewed the billing summary
attached as Exhibit D to the Declaration of Scott J. Street. The Court approves
the hourly rate of $500/hour. (Street Decl., ¶ 12.) Defendants answered the Complaint
on May 28, 2021, and the case was litigated moderately by Defendants, although they
did file a Cross-Complaint, until judgment was entered on March 4, 2025 following
a three-day bench trial.
Plaintiff argues that there is evidence
that the clients did not pay any attorney’s fees. However:
It is perhaps true that the payment of an attorney fee by a client
may be some evidence that the fee was both due and reasonable. However, the fact
that a fee was not paid is no evidence that it has not been earned and that the
client is not obligated to pay it. No evidence was introduced in this case to suggest
that the fees of Ms. Peizer were not warranted or that the services she rendered
were not appropriate. Indeed, Pasulka’s own statement that he had charged over $
5,000 for his services lends some support to the dimension of Peizer’s charges.
(West Coast Development v. Reed (1992) 2 Cal.App.4th 693, 707.)
Plaintiff also argues that counsel for Poulos and Xuxa billed only $28,710, which is ¼ of the $103,000 sought by these moving Defendants. The comparative efforts of the parties’ counsel may be relevant, but is not a definitive or dispositive factor.
Plaintiff argues that the time spent on preparing for the examination of non-party witness Hooper was excessing, as his entire testimony lasted less than 3 hours. The Court does not find the time billed in this regard to be unreasonable.
The Court agrees with Plaintiff that time spent on the summary judgment motion that was not filed should be excluded in the amount of $4,505. Defendants did not explain why the motion was not filed.
Although Defendants argue that the lodestar is $103,291.52, and includes costs, any costs were to be sought in the memorandum of costs filed on March 19, 2025. Further, Exh. D to the Street Declaration only reflects a lodestar amount of $66,589.37, excluding time spent in bringing this motion for attorney’s fees, and costs of $9,702.15. The Court will not award costs by way of this motion, as the memorandum of costs/motion to tax costs procedure applies.
As for the lodestar amount, the Court
finds that the reasonable amount of attorney’s fees incurred is $62,500, which includes
the time spent in bringing this motion for attorney’s fees that was not included
in the billing summary (Street Decl., Exh. D.) As such, Defendants’ motion for attorney’s
fees is GRANTED in the reduced amount of $62,500.