Judge: Gary Y. Tanaka, Case: YC072747, Date: 2022-10-05 Tentative Ruling

Case Number: YC072747    Hearing Date: October 5, 2022    Dept: B

PROCEEDINGS

Neil Heesch, et al. v. Victor Wang, et al.

YC072747

1. Neil Heesch, et al.’s Motion for Attorneys’ Fees and Costs   

    

    

   TENTATIVE RULING

   
   

               Neil Heesch, et al.’s Motion for Attorneys’ Fees and Costs is granted, in part.

    

               Background

    

               Plaintiffs Neil Heesch and Kimberly Heesch filed their Complaint on March 15, 2018.  Plaintiffs alleged the following facts:  Plaintiffs entered into a one-year residential lease agreement to rent the real property located at 1642 Carlson Land, Redondo Beach, from Defendant Victor Wang, owner and landlord of the subject property.  Plaintiffs allege that rats invaded the property leading them to vacate the premises.  Plaintiffs bring the following causes of action:  1.  Tortious Breach of the Warranty of Habitability; 2. Breach of Covenant of Good Faith and Fair Dealing; 3. Nuisance; 4. Violation of Business and Professions Code § 17200; 5. Negligence; and 6. Violation of Civil Code § 1950.5.  The matter proceeded to a bench trial. At trial, Defendant prevailed on the first through fifth causes of action. Plaintiff prevailed as to the sixth cause of action and was awarded damages in the sum of $10,500.00.

    

               Motion for Attorneys’ Fees

    

               Civ. Code, § 1717(a) states, in relevant part: “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.  . . . Reasonable attorney's fees shall be fixed by the court, and shall be an element of the costs of suit.”

    

               The Court determines the prevailing party on contract claims “upon final resolution of the contract claims and only by a comparison of the extent to which each party ha[s] succeeded and failed to succeed in its contentions.” Hsu v. Abbara (1995) 9 Cal.4th 863, 876 (internal quotations omitted). When a party obtains an unqualified victory by prevailing on or defeating a contract claim, that party is entitled to attorneys’ fees. Scott Co. of Calif. v. Blount, Inc. (1999) 20 Cal.4th 1103, 1109. Other non-contract claims that are joined in the action are disregarded for purposes of analyzing contract-based attorneys’ fees motions. Thus, even if a party may have been successful on a non-contract claim, the party who prevailed on the contract is entitled to attorneys’ fees pursuant to Section 1717. Santisas v. Goodin (1998) 17 Cal.4th 599, 615; Korech v. Hornwood (1997) 58 Cal.App.4th 1412, 1419-22.

    

               If neither party achieves a complete victory on the contract claims, it is within the trial court's discretion to determine which party prevailed on the contract. Scott Co. of Calif. v. Blount, Inc.(1999) 20 Cal.4th 1103, 1109. The court must “compare the relief awarded on the contract claim or claims with the parties' demands on those same claims and their litigation objectives as disclosed by the pleadings, trial briefs, opening statements, and similar sources.” Hsu v. Abbara, supra, 9 Cal.4th at 876. “[A] party who obtains an unqualified victory on a contract dispute, including a defendant who defeats recovery by the plaintiff on the plaintiff's entire contract claim, is entitled as a matter of law to be considered the prevailing party for purposes of section 1717. But when the results of the [contract] litigation are mixed, the trial court has discretion under the statute to determine that no party has prevailed.” DisputeSuite, LLC v. Scoreinc.com (2017) 2 Cal.5th 968, 973 (internal citation and quotation omitted).

    

               Code Civ. Proc., § 2033.420 states:

               “(a) If a party fails to admit the genuineness of any document or the truth of any matter when requested to do so under this chapter, and if the party requesting that admission thereafter proves the genuineness of that document or the truth of that matter, the party requesting the admission may move the court for an order requiring the party to whom the request was directed to pay the reasonable expenses incurred in making that proof, including reasonable attorney's fees.

               (b) The court shall make this order unless it finds any of the following:

               (1) An objection to the request was sustained or a response to it was waived under Section 2033.290.

               (2) The admission sought was of no substantial importance.

               (3) The party failing to make the admission had reasonable ground to believe that that party would prevail on the matter.

               (4) There was other good reason for the failure to admit.”

    

               Plaintiffs move, pursuant to CC § 1717, for attorneys’ fees and costs as the prevailing party on the residential lease agreement, as well as, pursuant to CCP § 2033.420, on the ground that Defendant failed to admit a request for admission that was later proven to be true.

    

The applicable attorneys’ fees provision states as follows: “In any action or proceeding arising out of this Agreement, the prevailing party between Landlord and Tenant shall be entitled to reasonable attorney fees and costs[.] ...” (Lease, para. 40).  Here, the attorneys’ fees provision, which provides for attorneys’ fees for “any action or proceeding arising out of” the agreement is sufficiently broad to cover each of Plaintiffs’ causes of action as each cause of action arose out of the lease agreement.

The Court, however, finds that, under the facts of this action and based on the resolution of all claims, there is no prevailing party on the contract. Defendant partially achieved its litigation objectives in defeating the first through fifth causes of action. The first through fifth causes of action constituted the most substantive portion of Plaintiffs’ claims related to the habitability issues on the property. Plaintiffs, on the other hand, only achieved a partial, qualified victory as to the sixth cause of action. The damages sought within the sixth cause of action were much less than that which were sought and could have been obtained in the tort and contract claims. Therefore, the Court determines that there is no prevailing party on the contract.

The Court does find, however, that Plaintiffs are entitled to attorneys’ fees and costs after proving the truth of a request for admission that Defendant denied. According to Plaintiffs, they served the following request for admission which was denied by Defendant: “Admit that YOU did not provide an accounting of the retention of the security deposit within 21 days of PLAINTIFFS moving out of the PROPERTY as required by Civil Code section 1950.5.”  (Decl., Eileen M. Kendall, ¶¶ 9-10.)  The Court notes that Plaintiffs failed to attach the RFA or Defendant’s response with the motion, but no objections were set forth by Defendant and, thus, the Court presumes the truth of the representation set forth in the declaration of Plaintiffs’ counsel.  At trial, Plaintiffs prevailed as to the sixth cause of action, ultimately establishing the truth of the request for admission.  Defendant’s opposition failed to address or counter this portion of the motion at all, and, therefore, provided no facts or evidence to meet any of the exceptions noted in CCP § 2033.420(b): “(1) An objection to the request was sustained or a response to it was waived under Section 2033.290. (2) The admission sought was of no substantial importance. (3) The party failing to make the admission had reasonable ground to believe that that party would prevail on the matter. (4) There was other good reason for the failure to admit.”

“The trial court has “broad authority” to determine the amount of a reasonable attorneys’ fees.  PLCM Group v. Drexler (2000) 22 Cal.4th 1084, 1095.  “[T]he fee setting inquiry in California ordinarily begins with the ‘lodestar,’ i.e., the number of hours reasonably expended multiplied by the reasonable hourly rate.”  Id. [“California courts have consistently held that a computation of time spent on a case and the reasonable value of that time is fundamental to a determination of an appropriate attorneys' fee award.”].  “The experienced trial judge is the best judge of the value of professional services rendered in his court, and while his judgment is of course subject to review, it will not be disturbed unless the appellate court is convinced that it is clearly wrong.”  Ketchum v. Moses (2001) 24 Cal.4th 1122, 1132 (internal quotation omitted.) 

Thus, Plaintiffs are entitled to attorneys’ fees under the lodestar method based on the reasonable amount of time the attorney spent multiplied by a reasonable rate.  Plaintiffs request the following: $60,295.00 (Attorney Kendall at 117.3 hours at an hourly rate of $500; Paralegal at 9.4 hours at $175).  While the Court finds that the attorneys’ fees sought reflect the fees incurred for the entire litigation to pursue all six causes of action, Plaintiffs are only entitled to fees and costs incurred in proving the truth of the admission.  Thus, the Court determines that the fees should be apportioned and reduced such that only 1/6 of the total amount of attorneys’ fees is ordered recoverable.

Therefore, Plaintiffs’ motion for attorneys’ fees is granted, in part.  Thus, the Court awards reasonable attorneys’ fees and costs in the sum of $10,049.17 which reflects 1/6 of the amount sought.  The amount of reasonable attorneys’ fees is fixed in the sum of $10,049.17.

Plaintiffs are ordered to give notice of this ruling.