Judge: Upinder S. Kalra, Case: BC659293, Date: 2023-03-27 Tentative Ruling

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Case Number: BC659293    Hearing Date: March 27, 2023    Dept: 51

Tentative Ruling

Judge Upinder S. Kalra, Department 51

HEARING DATE:   March 27, 2023

CASE NAME:           Sun West Mortgage Co. Inc., v. First Alliance Home Mortgage, LLC

CASE NO.:                BC659293

MOTION FOR ATTORNEYS’ FEES

MOVING PARTY: Plaintiff Sun West Mortgage Co. Inc.

RESPONDING PARTY(S): Defendant First Alliance Home Mortgage, LLC

REQUESTED RELIEF:

1.      An order granting attorneys’ fees totaling $59,192.81.

TENTATIVE RULING:

1.      Motion for Attorneys’ Fees is GRANTED.

STATEMENT OF MATERIAL FACTS AND/OR PROCEEDINGS:

On April 28, 2017, Plaintiff Sun West Mortgage Company, Inc. (“Plaintiff”) filed suit against Defendant First Alliance Mortgage company, LLC (“Defendant”) alleging causes of action for (1) breach of contract and (2) indemnity.  

On October 5, 2017, Defendant filed an Answer.

On May 29, 2019, a one-day bench trial took place, where the trial court found in favor of Plaintiff.

On March 9, 2020, Defendant filed a Notice of Appeal as to the Amended Judgment.

On November 2, 2022, the Clerk filed the appeal, indicating that the Court of Appeals affirmed the trial court’s judgment.

LEGAL STANDARD:

A prevailing buyer in an action under Song-Beverly “shall be allowed by the court to recover as part of the judgment a sum equal to the aggregate amount of costs and expenses, including attorney’s fees based on actual time expended, determined by the Court to have been reasonably incurred by the buyer in connection with the commencement and prosecution of such action.”  (Civ. Code, § 1794(d).) By permitting buyers who prevail under Song-Beverly to recover their attorneys’ fees, “our Legislature has provided injured consumers strong encouragement to seek legal redress in a situation in which a lawsuit might not otherwise have been economically feasible.” (Murillo v. Fleetwood Enterprises, Inc. (1998) 17 Cal.4th 985, 994.) 

The prevailing party has the burden of showing that the requested attorney fees are reasonable. (Robertson v. Fleetwood Travel Trailers of California Inc. (2006) 144 Cal.App.4th 785, 817.) The party seeking attorney fees “is not necessarily entitled to the compensation of the value of attorney services according to [his or her] own notion or to the full extent claimed . . . .”  (Levy v. Toyota Motor Sales, USA, Inc. (1992) 4 Cal.App.4th 807, 816.) If the “time expended or the monetary charge being made for the time expended are not reasonable under all circumstances, then the court must take this into account and award fees in a lesser amount.” (Nightingale v. Hyundai Motor America (1994) 31 Cal.App.4th 99, 104.) 

A calculation of attorneys’ fees for a Song-Beverly action begins with the “lodestar” approach, under which the Court fixes the lodestar at “the number of hours reasonably expended multiplied by the reasonable hourly rate.” (Margolin v. Regional Planning Com. (1982) 134 Cal.App.3d 999, 1004-1005.) “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.” (Ibid.)

“It is appropriate for a trial court to reduce a fee award based on its reasonable determination that a routine, non-complex case was overstaffed to a degree that significant inefficiencies and inflated fees resulted.”  (Morris v. Hyundai Motor America (2019) 41 Cal.App.5th 24, 39.) It is also appropriate to reduce a fee award based on “inefficient or duplicative efforts” in the billing record. (Id. at p. 38.) However, the analysis must be “reasonably specific” and cannot rely on general notions about the fairness of the fee award. (Kerkeles v. City of San Jose (2015) 243 Cal.App.4th 88, 102.) Moreover, in conducting the analysis, courts are not permitted to tie any reductions in the fee award to some proportion of the buyer’s damages recovery. (Warren v. Kia Motors America, Inc. (2018) 30 Cal.App.5th 24, 39.) 

The lodestar figure may also be adjusted, based on consideration of factors specific to the case, in order to fix the fee at the fair market value for the legal services provided. (Serrano v. Priest (1977) 20 Cal.3d 25, 49; PLCM Group, Inc. v. Drexler (2000) 22 Cal.App.4th 1084, 1095.) The factors considered in determining the modification of the lodestar include the nature and difficulty of the litigation, the amount of money involved, the skill required and employed to handle the case, the attention given, the success or failure, and other circumstances in the case. (EnPalm, LLC v. Teitler Family Trust (2008) 162 Cal. App. 4th 770, 774 (emphasis in original).) A negative modifier was appropriate when duplicative work had been performed. (Thayer v. Wells Fargo Bank, N.A. (2001) 92 Cal.App.4th 819.) 

ANALYSIS:

            Plaintiff moves for attorneys’ fees totaling $59,192.81.

Factual Background:

Plaintiff filed this initial action in April 2017. A bench trial occurred in May 2019, whereby the Court found in favor of Plaintiff. After Plaintiff filed a Motion for Attorneys’ Fees, the Court awarded Plaintiff $174,660.90 in fees, plus $4,400.01 in costs. Defendant filed an appeal of the judgment. The Court of Appeal affirmed the Trial Court’s order, indicating that the trial court did not abuse its discretion awarding fees and costs to Plaintiff.

Prevailing Party:

            Under CCP § 1032(b), a prevailing party is entitled to recover costs and fees. Additionally, the parties had an agreement whereby the prevailing party was entitled to fees and costs. Plaintiff argues that because this Court has already determined that Plaintiff is the prevailing party and Plaintiff prevailed on Defendant’s appeal, Plaintiff is entitled to costs and fees. (Dec. Luczon, ¶ 2-3, Ex. A-B.)

Lodestar Fees

The lodestar method looks at the time spent on a matter multiplied by the reasonable hourly rate. (Serrano, supra 20 Cal.3d at 49). The two-step process begins with the lodestar method, which is the time spent on the matter multiple by the hourly rate. After the lodestar method, the second step is determining whether a multiplier should be applied. The factors that Courts look at to determine if a multiplier is reasonable are: 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.” (Ketchum v. Moses (2001) 24 Cal.4th 1122, 1132).

Plaintiff argues that the requested fees are reasonable.

1.      Reasonableness of Hours Billed

Plaintiff argues that the total amount billed for the appeal is reasonable. Specifically, from January 2020 until present, Plaintiff incurred fees for researching the appeal, drafting an opposition to Defendant’s Motion to vacate the order, reviewing Appellant’s Opening Brief, drafting Respondent’s Brief, preparing and attending oral argument. (Dec. Luczon, ¶ 5, Ex. D.) The total hours spent over 3 years for this appeal were 145.4 hours.

Defendant argues that the Court has broad discretion to determine whether fees are reasonable. One such factor is what plaintiff “reasonably and in good faith could have expected to recover.” (Opp. 2: 28 – 3: 1.) Further, Defendant argues that the initial award of $174,660.90 was “clearly wrong” and should be reversed. Specifically, because the amount in dispute was $8,000, and therefore, the award was “grossly excessive.” (Opp. 3: 15-21.)

To determine if the requested amount is reasonable, California courts utilize the lodestar method. The two-step process begins with the lodestar method, which is the time spent on the matter multiple by the hourly rate. After the lodestar method, the second step is determining whether a multiplier should be applied. The factors that Courts look at to determine if a multiplier is reasonable are: 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.” (Ketchum v. Moses (2001) 24 Cal.4th 1122, 1132.)

Here, the Court finds that the hours is reasonable. A verified fee bill is “prima facie evidence the costs, expenses and services listed were necessarily incurred, and when they are properly challenged the burden of proof shifts to the party claiming them as costs.” (Hadley v. Krepel (1985) 167 Cal.App.3d 677, 682.) Plaintiff has provided a fee bill, as attached to the Luczon Declaration. After reviewing the fee bill, the Court finds that these fees were not excessive and reasonably incurred. It was Defendant who initiated the appeal, and therefore, it was reasonable and expected that Plaintiff would incur additional fees. Moreover, the hours of 145.4 are reasonable given that those hours were incurred over a three-year period. Lastly, as indicated in the Court’s appeals Order, “Respondent Sun West Mortgage Company, Inc. is awarded its costs on appeal.” Thus, the hours billed are reasonable.

2.      Reasonableness of Hourly Rate

Plaintiff argues that the hourly rates of the attorneys working on this matter are reasonable. The rates include $425 to $450 for a senior partner (an increase from 2021 to 2022), $400 to $450 for a junior partner with 18 years of experience (a similar increase), $250 to $300 for associate attorneys (a similar increase), and $125 to $175 for paralegals, (a similar increase.) (Luczon Dec. ¶ 5, 7-8, Ex. D.)

Defendant makes no argument as to the reasonableness of the hourly rates.

“In determining hourly rates, the court must look to the “prevailing market rates in the relevant community.” (Bell v. Clackamas County (9th Cir.2003) 341 F.3d 858, 868.) The rates of comparable attorneys in the forum district are usually used. (See Gates v. Deukmejian (9th Cir.1992) 987 F.2d 1392, 1405.) In making its calculation, the court should also consider the experience, skill, and reputation of the attorney requesting fees.” (Heritage Pacific Financial, LLC v. Monroy (2013) 215 Cal.App.4th 972, 1009.)

Here, the hourly rates are reasonable. The Declaration of Diane Luczon provides the experience of the partners, their schooling background, and year admitted to the bar. Additionally, as indicated in paragraph 9, other law firms bill at higher rates. Therefore, the Court finds that these hourly rates are reasonable based on the hourly rate of similarly situated attorneys in the Los Angeles area. Thus, the hourly rates are appropriate. 

Costs

Lastly, Plaintiff requests costs totaling $1,726.81. These costs are included in the Memorandum of Costs, which include filing fees, preparation of clerk’s transcript, printing and copying of briefs, and transmitting, filing, and serving of record, briefs, and other papers. Defendant raises no issues with these costs. Plaintiff’s request for costs is thus GRANTED, totaling $1,726.81.

CONCLUSION:

            For the foregoing reasons, the Court decides the pending motion as follows:

Motion for Attorneys’ Fees is GRANTED.

Moving party is to give notice.

IT IS SO ORDERED.

Dated:             March 27, 2023                       __________________________________                                                                                                                Upinder S. Kalra

                                                                                    Judge of the Superior Court