Fee Clause Interpretation: “Arising Out Of” Language In Escrow Agreement Did Encompass Fraudulent Concealment Victory By Plaintiff Buyers Against Defendant Seller And Affiliates

$412,500 Fee Award Under Escrow Fees Contract Clause Affirmed On Appeal.

            In Kim v. Lee, Case Nos. B295665/B303317 (2d Dist., Div. 7 May 26, 2021) (unpublished), plaintiff buyers won a fraudulent concealment claim against defendant seller/affiliates.  The buyers then moved for an attorney’s fees award under a broad escrow fees clause containing “arising out of” language relating to disputes between the two sides.  The lower court awarded buyers $412,500 out of a requested $591,936 in fees (disregarding a positive multiplier request).  The appellate court affirmed the fee award based on a de novo review of the contractual fee clause.  This sort of broad language has been held to cover torts in instructive earlier cases, so there was no reason to find otherwise given the similarity of the fees clause language to clauses in those previous published appellate court decisions.  (See, e.g., Lerner v. Ward, 13 Cal.App.4^th 155, 160 (1993); Xuereb v. Marcus & Millichap, Inc., 3 Cal.App.4^th 1338, 1344 (1992).)