$207,350 Fee Recovery Went POOF! On Appeal.
In Pasco v. MGK Consulting, Case No. B281144 et al. (2d Dist., Div. 2 March 27, 2019) (unpublished), defendants won a motion for judgment at the close of plaintiffs’ case based on lack of standing for two claims and eventually obtained judgment in their favor as to plaintiffs’ remaining claims. The trial judge awarded fees under Civil Code section 1717 to defendants based on an operating agreement fees clause. The total award was $207,350.
That all went POOF! on appeal. The reason was simple: the fees clause only encompassed arbitration proceedings, not court litigation. Given that the defense prevailed in court (not arbitration), no fee recovery was contractually allowable.