Judge: John J. Kralik, Case: 19BBCV00503, Date: 2022-10-21 Tentative Ruling

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Case Number: 19BBCV00503    Hearing Date: October 21, 2022    Dept: NCB

Superior Court of California

County of Los Angeles

North Central District

Department B

BACKGROUND

A.    Allegations of Complaint

Plaintiff Robert Shutty (“Plaintiff”) commenced this action for partition by sale in real property located at 5109 Klump Avenue, North Hollywood, CA 91601.  Plaintiff alleges that he owns 50% of the property and that Defendant Kelly Lee Ratledge aka Kelly Lee Sexton (“Defendant”) owns 50%.  Plaintiff alleges that the parties split all costs associated with ownership of the property until 1998.  He alleges that though Defendant currently resides on the property, she has not been paying any expenses.  The parties disagree on whether Defendant is entitled to her 50% share of the gross proceeds from the sale of the property, without her lack of contribution to the expenses and upkeep of the property that have been undertaken since 1998. 

            The complaint, filed June 7, 2019, alleges causes of action for: (1) partition of real property (CCP §872.010 et seq.); and (2) declaratory relief. 

B.     Relevant Background

On May 20, 2021, Plaintiff filed a Notice of Conditional Settlement of the Entire Case, stating that the settlement agreement conditions dismissal of the matter on the satisfactory completion of the specified terms that are not to be performed within 45 days of the settlement and that the request for dismissal will be filed no later than January 1, 2022. 

The Settlement Agreement and Mutual Release (“Settlement Agreement) was entered between Plaintiff Robert Shutty and Defendant Kelly Lee Ratledge a.k.a. Kelly Lee Sexton.  They each signed the agreement on May 17, 2021.  The Settlement Agreement states in relevant part (Mot., Ex. 1):

·         Option 1: Within 90 days of execution of the Settlement Agreement, Defendant will buyout Plaintiff from 5109 Klump Ave., North Hollywood, CA 91601 (“Property 1”) and 5115 Klump Ave., North Hollywood, CA 91601 (“Property 2”) at a total of $931,698 (“Buyout Payment”).  (Settlement Agreement, §2.)

·         Option 2:  In the event that Defendant does not buyout Plaintiff, the parties agree the properties shall be sold to a third-party purchaser on the open market. The parties agreed on a method to select a real estate broker (and commission cap).  The parties also agreed to the terms of the sale and how to distribute the proceeds.  The parties agreed to cooperate and take any actions necessary to effectuate the sale.  (Id., §3.) 

·         The parties understand that time is of the essence with respect to the obligations under the Settlement Agreement.  (Id., §6.) 

·         “The Parties agree that they shall execute and file with the court a notice of settlement, acknowledging their agreement. It is hereby agreed, acknowledged, stipulated, and requested that the Court shall retain jurisdiction over all parties and the Action and to enforce and supervise the terms and conditions of the settlement and stipulation herein until full performance of the terms of this settlement is completed and for entry of judgment in the event of default pursuant. California Code of Civil Procedure §664.6 et seq. Shutty shall file the Notice of Conditional Settlement with the Court.”  (Id., §7.)

·         The parties each provided releases in the Settlement Agreement and a Civil Code, § 1542 waiver.  (Id., §§10-12.) 

On December 28, 2021, the Stipulated Judgment was entered.  The parties stipulated that: (1) each party shall vacate the properties at 5109 and 5115 Klump Avenue, North Hollywood, California within 30 days after close of escrow for the sale of the properties; (2) each party shall be liable to the other for $500/day in damages for each day he or she fails to vacate the properties after the 30^th day after the close of escrow; (3) any party who violates any provision of the stipulation, which violation requires the non-violating party to obtain assistance from the Court for possession of the properties, shall be liable to the non-violating party for reasonable attorney’s fees and costs incurred in connection with any procedures initiated to obtain possession of the properties; and (4) if either party does not vacate within 30 days after the close of escrow of the sale of the properties, the Court shall issue a writ of possession upon ex parte notice.  (See Mot. at Ex. 2.) 

On April 20, 2022, the Court granted Plaintiff’s ex parte application for writ of possession and order for attorney’s fees and costs of $2,500 and holdover damages of $1,000 against Defendant pursuant to the stipulated judgment.  That same day, a writ of possession of the properties was issued against Defendant.

On May 2, 2022, a writ of possession of real property was issued against Defendant. 

C.     Motion on Calendar

On August 3, 2022, Plaintiff filed a motion to amend the judgment to add $46,881.76 in attorney’s fees, costs, and holdover damages to the Stipulated Judgment entered on December 28, 2021.

On August 11, 2022, Defendant (now a self-represented litigant) filed a declaration in opposition to the motion. 

On August 24, 2022, Plaintiff filed reply papers.

The matter came for hearing on September 2, 2022.  The Court continued the hearing to allow Plaintiff’s counsel to file a serve a supplemental declaration that attached his billing records by October 7, 2022.  The Court also permitted Defendant to file an opposition by September 16, 2022 and for Plaintiff to file a reply.

On September 16, 2022, Defendant filed a supplemental declaration/opposition.

On September 27, 2022, Brent A. Kramer (Plaintiff’s counsel) filed a supplemental declaration.

On October 13, 2022, Plaintiff filed reply papers.

DISCUSSION

            Plaintiff seeks to amend the Stipulated Judgment to add $46,881.76 in attorney’s fees, costs, and holdover damages. 

Plaintiff argues that the escrow on the sale of the property closed on March 18, 2022, such that the 30-day deadline for the parties to vacate the property pursuant to the Stipulated Judgment was April 17, 2022.  (See Kramer Decl., ¶5.)  While Plaintiff moved out on April 16, 2022, Plaintiff argues that Defendant refused to timely move out. (Id.)

Plaintiff’s counsel, Brent A. Kramer, states that as a result of Defendant’s breach of the Stipulated Judgment, Plaintiff applied ex parte for a writ of possession of real property on April 19, 2022 and incurred $18,653 in attorney’s fees and $330.15 in costs.  (Id., ¶6.)  On April 20, 2022, the Court granted the order for writ of possession as well as attorney’s fees and costs of $2,500 and holdover damages of $1,000, as of that date, pursuant to the Stipulated Judgment.  (Id., ¶7.)  While Defendant paid the sums by check on April 25, 2022, she refused to vacate the properties.  (Id.)  Mr. Kramer states that Plaintiff incurred the costs of the issuance of the writ, the preparation of the accompanying Sheriff’s instructions, electronic writ declaration, and attorney service costs for time to travel to the Burbank Courthouse to meet with the Sheriff’s Department and submit the writ, which amounted to $8,507 in attorney’s fees and $1,462.84 in costs.  (Id., ¶¶8-9.) 

Mr. Kramer also states that the Sheriff’s Department posted a notice to vacate the property on May 5, 2022, but Defendant filed an ex parte application to quash the writ of possession on May 6, 2022 and Plaintiff opposed the application that same day.  (Id., ¶¶11-13.)  On May 9, 2022, the Court denied Defendant’s application.  (Id., ¶14.)  Mr. Kramer states that Plaintiff incurred attorney’s fees in the amount of $6,353 and costs of $75.97 to oppose Defendant’s ex parte application.  (Id., ¶¶15-16.) 

Mr. Kramer states that Defendant vacated the property on May 10, 2022, such that Defendant was in breach of the Stipulated Judgment for 23 days from April 18, 2022 to May 10, 2022.  (Id., ¶17.)  Mr. Kramer states that he has been an attorney in Florida and California since 2005 and 2008, respectively, and that his hourly rate is $610/hour and that Plaintiff has paid $33,513 in connection with enforcing the terms of the Stipulated Judgment and to obtain possession of the property.  (Id., ¶¶18-19.)  Plaintiff states that billing records can be provided if the Court seeks further details of the tasks completed.  (Mot. at p.2.) 

In total, Plaintiff argues that Defendant owes $33,513 in attorney’s fees ($18,653 for preparing and appearing at Plaintiff’s ex parte application to enforce the Stipulated Judgment, $8,507 for preparing and pursuing the writ of execution for possession of the property, and $6,353 for opposing Defendant’s ex parte application to quash), $1,868.76 in costs ($330.15 + $1,462.84 + $75.97)[1], and $11,500 in holdover damages over 23 days (= $500/day x 23 days).  This amounts to $6,881.76.

In opposition, Defendant argues that in order to recover damages for harm pursuant to CACI 350 (re contract damages), Plaintiff must prove a contract was made.  Defendant also argues that punitive damages in connection with a breach of contract claim is improper and that the $500/day damages, although agreed upon by the parties, is punitive in nature.  Defendant argues that the Stipulated Judgment required the parties to vacate both properties, but Plaintiff moved from 5109 Klump Avenue to 5115 Klump Avenue, and that Plaintiff only moved out after she moved out of 5109 Klump Avenue.  (Def.’s Decl., ¶7.)  Thus, she argues that Plaintiff was also in breach of Stipulated Judgment.  (Id., ¶8.)  She argues that any damages awarded against her for failure to vacate should be offset by Plaintiff’s breach.  (Id., ¶9.)  Defendant also argues that Plaintiff is in breach of the Settlement Agreement because he has not transferred stock to her and has failed to provide offers on the 5115 Klump Avenue property.  (Id., ¶¶11-13.)  Finally, Defendant argues that Mr. Kramer has not detailed his hours nor justified his $610 hourly rate.  (Id., ¶14.) 

In reply, Plaintiff provides his declaration in response to Defendant’s statements.  Plaintiff states that he moved out completely from both 5109 and 5115 Klump Avenue on April 16, 2022 and that Defendant’s claim that he did not move out of the properties is false.  (Pl.’s Decl., ¶2.)  Plaintiff also states that he sent over copies of the Clear Currents stock certificates to Defendant’s former counsel and that he also served an affidavit of lost share certificates in lieu of the originals on July 29, 2022, upon the request of Defendant’s former counsel.  (Id., ¶¶4-6.)  In that affidavit, he stated that he affirmed that the ownership of the certificates “shall be vested in Sexton.”  (Id., ¶5.)  In his supplemental declaration re lost shares, Plaintiff states that the originals of the Clear Currents, Inc. stock certificates have been lost/misplaced/stolen, he has not transferred any Clear Currents, Inc. Certificates to any person or entity, he affirms that all share certificates he owned will be vested in Defendant, he intends to transfer all ownership of stock in Clear Currents, Inc.to Defendant, he releases Clear Currents, Inc. and Defendant and any successor from liability relating to loss or theft of any share, he agrees not to sue Clear Currents, Inc. or Defendant for any benefits conferred by the lost certificates, he agrees to indemnify Clear Currents, Inc. from any claims made against it based on the lost certificates, and if he comes into possession of the lost certificates he will transmit them to Defendant.  (Pl.’s 10/13/22 Decl., ¶¶4-11.)

Plaintiff also states that contrary to Defendant’s claims, he provided all offers from his broker for both properties and that each offer was made for both properties.  (Pl.’s Decl., ¶7.)  Mr. Kramer provides all offers on the properties that he states were provided to Defendant.  (Kramer Decl. re Reply, ¶7, Ex. 1.)   In the second reply brief, Plaintiff’s counsel confirms that there were only 9 offers and that all offers were shared to Defendant by placing the offers in a DropBox folder.  (Kramer 10/13/22 Decl., ¶¶5-12.) 

In the supplemental opposition brief, Defendant again argues that Plaintiff has not satisfied all conditions precedent because he did not timely move out of the properties, he did not return the stock certificates, and he did not provide copies of the purchase agreements. 

Here, the parties agreed to the terms of the Stipulated Judgment.  Although Defendant argues Plaintiff must prove that a contract was made, Defendant acknowledges that she entered into the Stipulated Judgment.  Further, Defendant’s focus on punitive damages is not the correct issue.  Rather, the holdover damages of $500/day was agreed upon by the parties as a term of the Stipulated Judgment. 

Next, Defendant argued in opposition that Plaintiff did not vacate the property nor provide transfers of stock and, therefore, he too was in breach of the Settlement Agreement.  However, Defendant provides no evidence other than her declaration statement.  In his declaration submitted with the reply brief, Plaintiff refuted Defendant’s statements.  Defendant also cites to the declaration of Itay Mevorakh filed on May 6, 2022 (in support of an ex parte application).  Mr. Mevorakh states that he is the managing member of IM40 LLC, the new owner of the properties, and he affirmed that Plaintiff had moved out and had not lived at the properties since April 16, 2022.  (Mevorakh Decl. dated May 6, 2022, ¶3.)  Thus, it does not appear that Plaintiff was in breach of the Settlement Agreement and did in fact move out of the properties by April 16, 2022.  Further, Plaintiff has affirmed that copies of the stock certificates and an accompanying affidavit were provided to Defendant.  As such, the Court does not find that Plaintiff was in breach of the Settlement Agreement and, thus, no setoff will be ordered. 

With his supplemental declaration, Mr. Kramer provides his billing records to support the hours he and his firm incurred.  (See Kramer Suppl. Decl., Ex. 1.)  Mr. Kramer states that the invoices have already been paid by Plaintiff.  (Id., ¶3.)  Plaintiff seeks time billed by: (a) Barak Lurie (partner, licensed in 1989) at $685/hour; (b) Brent Kramer (partner, licensed in 2005) at $610/hour; and (c) Shannon King (paralegal, $200/hour).  (Id., ¶¶4-7.)  Mr. Kramer states that the invoices seek fees and costs in connection with: (1) the ex parte for writ of possession for $16,695.50 in fees and $330.15 in costs; (2) issuance and service of writ of possession for $8,507 in fees and $1,462.84 in costs; (3) Defendant’s ex parte application for $6,353 in fees and $75.97 in costs; (4) motion to amend judgment for $18,331.50 in fees and $115.50 in costs; and (5) an anticipated $3,000 In fees and costs to oppose Defendant’s arguments and attend the hearing.  (Id., ¶¶8-21.)  Mr. Kramer seeks fees of $49,887 (=$16,695.50 (category 1) + $8,507 (category 2) + $6,363 (category 3) + $18,331.50 (category 4)) + $3,000 anticipated fees/costs + $1,984.46 in costs (for categories 1 to 4).  (Id., ¶¶22-24.)  In the October 13, 2022 reply brief, Mr. Kramer now seeks $52,887 in fees for preparing a second reply brief.  (The increased amount as of October 13, 2022 is not supported by evidence.)

Although billing records have been provided, Plaintiff has not stated how many hours each counsel and paralegal spent per category.  The billing records reflect time spent by counsel from April 14, 2022 to September 14, 2022.  Further, the Court finds that billing rates of $685/hour by Mr. Lurie and $610/hour by Mr. Kramer to be unreasonably high.  The Court will make certain reductions to the fees requested:

·         The $3,000 anticipated costs: The Court will reduce the “anticipated” costs for attending the hearing and responding to Defendant’s arguments to $500 total.  ($2,500 reduction)

·         Time claimed by Ms. King: The Court has reviewed the time claimed by paralegal Shannon King.  Most of the time entries involve telephone calls (or attempts to make telephone calls), meeting with counsel, reviewing status of documents, and other secretarial work.  Thus, the Court will reduce some of Ms. King’s hours by 10 hours. ($2,000 reduction)

·         The 0.10 hour incurred by “LM” at $425/hour on September 2, 2022 will be reduced. Mr. Kramer has not stated who “LM” is in his supplemental declaration brief nor provided support for the billing rate of $425/hour for this individual.  ($42.50 reduction)

·         Based on the Court’s summation, it appears that Mr. Kramer spent about 52 hours and Mr. Lurie spent about 7 hours.  The hours spent by Mr. Kramer are somewhat high, such that the Court will reduce the hours awardable to 40 hours.  ($7,320 reduction for 12 hours x $610/hour)

·         Thus, the Court will reduce from the fees a total of $11,862.50. 

·         Accordingly, the total amount of fees awarded shall be $38,024.50 (= $49,887 total fees requested - $11,862.50 reduction). 

The Court grants Plaintiff’s motion to amend the Stipulated Judgment to add attorney’s fees, cost, and holdover damages in the total amount of $38,024.50, plus $1,984.46 in costs.  

CONCLUSION AND ORDER

            Plaintiff Robert Shutty’s motion to amend the Stipulated Judgment to add attorney’s fees, costs, and holdover damages is granted in the sum of $38,024.50 in amount of attorney’s fees and $1,984.46 in costs.  Plaintiff is ordered to prepare and submit a proposed amended judgment for the Court’s signing following the hearing on this matter.

Plaintiff shall give notice of this order.