Judge Mark E. Windham, Case Number: 23NWLC20081, Date: 2024-10-22 Tentative Ruling

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Defendant Lynda Franzen’s Motion for Attorney’s Fees and Costs is GRANTED IN THE AMOUNT OF $5,000.00.

Plaintiff Main Mercantile, LLC (“Plaintiff”) filed the instant action for breach of contract and common counts against Defendants Chip Brown and Lynda Franzen (“Defendant Franzen”) on July 13, 2023. Defendant Franzen filed a demurrer to the Complaint on May 6, 2024. On July 10, 2024, Plaintiff dismissed Defendant Franzen from the action without prejudice.

Defendant Franzen filed the instant Motion for Attorney’s Fees and Costs on August 23, 2024. Plaintiff filed an opposition on August 15, 2024 and Defendant Franzen replied on October 15, 2024.

Defendant Franzen brings the instant Motion pursuant to Code of Civil Procedure sections 1032, 1033.5 and Civil Code section 1717. A prevailing party is entitled to recover costs, including attorneys’ fees when authorized by contract, statute, or law. (Code Civ. Proc., § 1032, subd. (a)(4); § 1033.5, subd. (a)(10).) A motion for attorney’s fees must be filed and served with the time for filing a notice of appeal under Cal. Rules of Court Rule 8.822. (Cal. Rules of Court Rule 3.1702(a).) Cal. Rules of Court Rule 8.822 states that an attorneys’ fees motion must be filed within the earlier of (1) 30 days after the trial court clerk serves the moving party with notice of entry of judgment; (2) 30 days after the moving party serves or is served by a party with a document entitled “Notice of Entry” of judgment or a file-endorsed copy of the judgment, accompanied by proof of service; or (3) 90 days after entry of judgment. (Cal. Rules of Court 8.822(1).) Here, the Motion was timely filed as there has been no entry of judgment or notice of entry of judgment.

Defendant Franzen moves for attorney’s fees pursuant to the parties’ relevant contractual provision, which states in relevant part: “ATTORNEY’S FEES. In any legal action brought by either party to enforce this Agreement or relating to the Residence, the prevailing party will be entitled to all costs incurred in connection with that action, including reasonable attorney fees, expert witness and consultant fees, and costs and expenses.” (Compl., Exh. A, 2017 Lease Agreement, ¶73.) The provision provides for attorney’s fees to enforce the lease agreement or relating to the residence. Defendant Franzen argues that they are a prevailing party under this provision based on the definition set forth in Code of Civil Procedure section 1032, which includes “a defendant in whose favor a dismissal is entered.” (Code Civ. Proc., § 1032, subd. (b)(4).)

In opposition, Plaintiff argues that Civil Code section 1717 creates an exception to that definition of “prevailing party” by dictating that “[w]here an action has been voluntarily dismissed or dismissed pursuant to a settlement of the case, there shall be no prevailing party for purposes of this section.” (Civ. Code, § 1717, subd. (b)(2).) Civil Code section 1717, however, pertains to attorney’s fees on actions on a contract:

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.

(Civ. Code, § 1717, subd. (a).) In Khan v. Shim (2016) 7 Cal.App.5th 49, the Court of Appeals ruled that while Civil Code section 1717, subdivision (b)(2) barred recovery of attorney’s fees with respect to the contract causes of action, the parties’ contractual attorney’s fees provision was broad enough to allow for an award of attorney’s fees on the tort causes of action. (Khan v. Shim (2016) 7 Cal.App.5th 49, 52.) Here, the parties’ attorney’s fees provision is likewise broad enough to cover non-contract causes of action “relating to the residence.”

Defendant Franzen argues that the common counts for open book account and for work, labor, services, and materials rendered are causes of action that allow for an award of non-contractual attorney’s fees. The opposition makes no response to this argument, or to the citation to Khan and its holding with respect to attorney’s fees on non-contract causes of action. Therefore, the Court finds Defendant Franzen is entitled to recover attorney’s fees incurred with respect to the common counts.

The moving party bears the burden of proof with respect to attorney’s fees. (Code Civ. Proc., § 1033.5, subd. (c)(5)(A).) Specifically, a party seeking fees has the burden of showing the fees incurred are “allowable,” are “reasonably necessary to the conduct of the litigation,” and are “reasonable in amount.” (Levy v. Toyota Motor Sales, U.S.A., Inc. (1992) 4 Cal.App.4th 807, 816.)

The Court’s objective is to award attorney’s fees at the fair market value based on the particular action. (Ketchum v. Moses (2001) 24 Cal.4th 1122, 1132.) “The reasonable hourly rate is that prevailing in the community for similar work.” (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 . . . .’” (Ketchum v. Moses (2001) 24 Cal.4th 1122, 1134.) The lodestar method is based on the factors, as relevant to the particular case: “(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.” (Id. at 1132.) “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.’’” (Id.) A negative modifier was appropriate when duplicative work had been performed. (Thayer v. Wells Fargo Bank, N.A. (2001) 92 Cal.App.4th 819.)

The Motion seeks $5,000.00 in attorney’s fees based on the retainer Defendant Franzen paid to defense counsel and that the fees incurred by defense counsel exceeded that amount. (Motion, Disner Decl., ¶¶2, 5.) Defense bills at $395.00, which is a reasonable hourly rate for an attorney with more than 15 years of experience. (Id. at ¶4.) Defense counsel spent more than 12.6 hours on this action by (1) reviewing the Complaint, multiple lease agreements and addenda, relevant correspondence, other evidence, and pertinent authority; (2) speaking at length with Defendant’s former counsel, among other things; (3) preparation of a lengthy and detailed Meet and Confer Letter to Plaintiff’s counsel on the merits of this action; (4) preparing, filing, and serving Defendant’s demurrer; (5) speaking with and exchanging emails with Plaintiff’s counsel on the subject of settlement; (6) preparation, filing and service of Defendant’s Reply in support of the demurrer; and (7) appearing on Defendant’s behalf on the date of the demurrer. (Id. at ¶2.) This declaration sufficiently demonstrates the time spent by defense counsel on this action, which Plaintiff’s opposition does not dispute.

Based on the foregoing, Defendant Lynda Franzen’s Motion for Attorney’s Fees and Costs is GRANTED IN THE AMOUNT OF $5,000.00.