Judge: Maurice A. Leiter, Case: 20STCV23624, Date: 2023-02-22 Tentative Ruling

Case Number: 20STCV23624    Hearing Date: February 22, 2023    Dept: 54

Hearing Date: February 22, 2023

Department 54, Judge Maurice A. Leiter

Motion for Attorney’s Fees

Moving Party: Plaintiff Lijuan Guan

Responding Party: Defendants JCP LP and Rediger Investment Corporation

T/R:    PLAINTIFF’S MOTION IS DENIED WITHOUT PREJUDICE.

            PLAINTIFF to notice. 

If the parties wish to submit on the tentative, please email the courtroom at¿SMCdept54@lacourt.org¿with notice to opposing counsel (or self-represented party) before 8:00 am on the day of the hearing. 

The Court considers the moving papers and opposition.

BACKGROUND

On June 23, 2020, Plaintiff Lijuan Guan filed a complaint against Defendants JCP, L.P., et al., asserting causes of action for (1) quiet title; (2) fraud; (3) slander of title; (4) cancellation of deed; (5) declaratory relief; and (6) false notary acknowledgment. Guan alleges that a trust deed with Guan’s forged signature was recorded against Guan’s real property and then foreclosed on.

            On March 23, 2021, Cross-Complainants JCP, L.P. and Rediger Investment Corporation filed the operative first amended cross-complaint against Cross-Defendant Hanh Nguyen, et al., asserting causes of action for (1) negligence; (2) escrow negligence; (3) breach of fiduciary duty; (4) breach of contract; (5) indemnification and contribution; (6) declaratory relief; (7) fraud; (8) civil conspiracy; (9) negligent misrepresentation; (10) intentional misrepresentation; (11) unjust enrichment; (12) constructive trust; and (13) conversion. Cross-Complainants were lenders on the Guan deed of trust. Cross-Complainants allege Silver Bay, the escrow company, breached the escrow agreement by accepting a deed of trust that was not notarized by the notary Silver Bay had designated.

            June 13, 2022, the Court granted Plaintiff’s motion for summary adjudication of the first, fourth and fifth causes of action for quiet title, cancellation of instruments, and declaratory relief.

ANALYSIS

The prevailing party in “any action on a contract” shall be awarded reasonable attorney’s fees incurred to enforce that contract where the contract specifically provides for attorney’s fees.  (Cal. Civ. Code § 1717(a).)

Plaintiff moves for an award of attorney’s fees in the amount of $55,122.50. Plaintiff asserts she is entitled to fees under paragraph 6 of the deed of trust, which provides, “…if any action or proceeding is commenced which affects Lender's interest in the Property… then under, at Lender's option, may make such appearances, disburse such sums, including reasonable attorney's fees, and take such action as is necessary to protect Lender's interest… Any amounts disbursed by Lender…shall become additional indebtedness of Borrower secured by this Deed of Trust.” (Decl. Sugars, Exh. 1.)

In opposition, Defendants argues that this paragraph is not an attorney’s fees provision under Civ. Code § 1717. Defendants cite to Hart v. Clear Recon Corp. (2018) 27 Cal.App.5th 322 and Chacker v. JPMorgan Chase Bank, N.A., (2019) 27 Cal.App.5th 351. Both Hart and Chacker found that the language in paragraph 6 does not allow for a separate award of attorney’s fees, but rather allows fees to be added to the debt. (Hart, supra at 327-329; Chacker, supra at 356-359.) Plaintiff has not filed a reply to respond to this authority.

Plaintiff also represents that the original promissory note has an attorney’s fees provision, but Plaintiff does not provide the language of that provision or a copy of the note.

Plaintiff may not recover fees under paragraph 6 of the deed of trust. The motion is DENIED without prejudice. If Plaintiff is correct about the attorney’s fees provision in the promissory note, Plaintiff may move for an award of fees under that provision.