Judge: Latrice A. G. Byrdsong, Case: 22NWLC22743, Date: 2023-10-02 Tentative Ruling

Case Number: 22NWLC22743    Hearing Date: October 2, 2023    Dept: 25

Creditors Adjustment Bureau, Inc. v. KC Branaghans, Inc. 


22NWLC22743

ANALYSIS: 

I. Background

On September 28, 2022, Plaintiff Creditors Adjustment Bureau, Inc. (“Plaintiff” or “CAB”) filed an action against Defendant KC Branaghans, Inc. dba KC Branaghans adba KC Branaghan’s Irish Pub[1] & Restaurant (“Defendant” or “KC”) for open book account, account stated, reasonable value, and breach of contracts.

On January 11, 2023, KC filed an Answer to the Complaint. KC also filed a Cross-Complaint against Cross-Defendants CAB and American Textile Maintenance Company dba Republic Master Chefs (“ATM”) for 1) fraud, 2) breach of contract, 3) breach of covenant of good faith and fair dealing, 5) unfair business practices, and 6) declaratory relief. On February 16, 2022, the Court held a hearing and granted the Petition.

On June 20, 2023, Cross Defendant CAB’s Demurrer was Sustained without leave to amend.

On July 12, 2023, Cross-Defendant CAB filed the instant motion for Attorney Fees against Defendant KC. 

On September 18, 2023, Defendant KC Branaghans filed its Opposition to the instant motion.

            On September 25, 2023, Cross-Defendant CAB filed its Reply.

II. Legal Standard & Discussion

A. Timeliness

“A notice of motion to claim attorney’s fees for services up to and including the rendition of judgment in the trial court . . . must be served and filed within the time for filing a notice of appeal under . . . rules 8.822 and 8.823 in a limited civil case.” (Cal. Rules of Court, rule 3.1702, subd. (b)(1).) (Emphasis added.) In a limited civil case, a notice of appeal must be filed on or before the earliest of 30 days after service of a document entitled “Notice of Entry” of judgment or 90 days after the entry of judgment. (Cal. Rules of Court, rule 8.822, subd. (a)(1).)

Petitioner’s motion is timely as it was filed within 90 days after entry of judgment.

B. Request for Attorney’s Fees and Costs

In its June 20, 2022, order, the Court ruled that Petitioner is the prevailing party.  A prevailing party is entitled to recover costs as a matter of right. (Code Civ. Proc., § 1032, subd. (a)(4), (b).)

“[W]hen authorized by contract, statute or law; attorney fees are allowable as ‘costs’ under Code of Civil Procedure section 1032.” (Del Cerro Mobile Estates v. Proffer (2001) 87 Cal.App.4th 943, 947.) However, “‘recoverable litigation costs [under section 1032] . . . include attorney fees, . . . only when the party entitled to costs has a legal basis, [that is] independent of the cost statutes and grounded in an agreement, statute, or other law, upon which to claim recovery of attorney fees.’ [Citation.]” (Id.)

All costs must be “reasonably necessary to the conduct of the litigation rather than merely convenient or beneficial to its preparation” and reasonable in amount. (Code Civ. Proc., §

1033.5, subd. (c)(2), (3).)

Petitioner’s attorney fees are allowable as costs under Code of Civil Procedure § 1032 because this action is based on a breach of contract claim which is a “statute ‘independent of the cost statutes’ . . . .” (Del Cerro Mobile Estates v. Proffer, supra, 87 Cal.App.4th at p. 948.) The breach of contract attorney fees and costs provision is found in Civil Code § 1717.  It reads in pertinent 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."

(Civil Code § 1717(a).)

            Respondent argues the instant petition be denied because the Court found no contract existed between the parties.  However, in Reply, Petitioner argues that “the statute gives a reciprocal remedy for a nonsignatory defendant, sued on a contract as if he or she were a party to it, when a plaintiff would clearly be entitled to attorney's fees should he prevail in enforcing the contractual obligation against the defendant.”  (Milman v. Shukhat (1994) 22 Cal.App.4th 538, 543.) 

            Here, Respondent sued under a breach of contract claim and thus opened the door for reciprocal remedy.  The contract (Linen & Garment Rental Agreement) used to make the claim states that the prevailing party shall be entitled to attorney’s fees and costs. (Mot., Exh. 1.) The Resolution of Disputes section states that the “prevailing party shall be entitled to recover… their attorney's fees, as well as reasonable costs incurred in pursuing the matter.” (Id.)

            Therefore, the fees are allowable.

            Respondent argues that the fees are excessive on the basis that: (1) the associate billing rate is too high based on a survey in the National Law Journal (not attached as an exhibit) and (2) by using three attorneys there was an inordinate amount of duplicative billing.  In reply, Petitioner notes that the Declaration of Kenneth J. Freed contains the billing history of the attorneys on the matter and designates which tasks were completed by each attorney therein.  Further each attorney has attested that their billing rate is $500 per hour under penalty of perjury. 

Petitioner requests $6,550.00 attorney fees. (Freed Decl., ¶ 5.)  The Court finds the requested attorney’s fees were reasonably necessary to the conduct of the litigation and are reasonable in amount.

Petitioner also requests $264.54 in costs. The amount consists of filing and motion fees ($240), and fees for electronic filing or service ($24.54.) (Memorandum of Costs, filed July 11, 2023.) Code of Civil Procedure section 1033.5 expressly allows for those costs. (Civ. Code Proc., § 1033.5 (1), (4), (13), (14).) “If items on their face appear to be proper charges, the verified memorandum of costs is prima facie evidence of their propriety, and the burden is on the party seeking to tax costs to show they were not reasonable or necessary.” (Jones v. Dumrichob (1998) 63 Cal.App.4th 1258, 1266.) Here, Petitioner filed a verified memorandum of costs, and Respondent has not opposed nor moved to tax the costs.

Accordingly, the Court finds the requested costs proper charges.

For the reasons discussed above, the Court grants Petitioner’s request for costs of $264.54 and attorney’s fees in the reduced amount of $6,550, for a total of $6,814.54.

III. Conclusion & Order

For the foregoing reasons, Petitioner Creditors Adjustment Bureau’s Motion for Attorney’s Fees and Costs is GRANTED. The Court awards Petitioner $6,550 in attorney’s fees and $264.54 in costs.