Fee Clause Interpretation: Plaintiff Recovering $1.3M Jury Verdict On Premises Liability Claim Against State Of Cal. Not Entitled To $1.2M In Requested Fees Based On Lease Clause As Claim Did Not Arise “Out Of The Execution Of The [Rental] Agreement”

Plaintiff Never Mentioned Lease Or Fee Recovery In The Premises Liability Suit Until After The Jury Win, With Appellate Court Agreeing With Trial Court’s Construction Of The Fees Clause.

            We get the feeling that the 1/2 DCA in Wright v. State of California, Case No. A150165 (1^st Dist., Div. 2 July 27, 2018) (unpublished) believed plaintiff somewhat was “pulling a fast one” by not even mentioning that the dispute over which he won a $1.3 million jury verdict really involved a lease with an attorney’s fees clause. As a result, it completely found the trial judge was “spot on” in concluding that the fees clause did not apply and denying an almost $1.2 million fee post-verdict fee request.

            The problem here was that plaintiff was suing for a premises liability stair trip outside of the premises he was renting from the State of California. He did not mention the lease in the complaint or prayer for recovery of fees. The trial judge decided that the fees clause was narrow, applying only to a dispute which had to “arise out of the execution of this agreement,” and characterizing the suit for one just like any public member would bring on a premises liability basis rather than a tenant suing under the lease. (Made all the more so because the lease defined the “premises” circumspectly as the house plaintiff was renting from the State.) Plaintiff tried to rely on a “common area” theory which was successful in Hemphill v. Wright Family, LLC, 234 Cal.App.4^th 911 (2015), but the lower court correctly found it distinguishable because the jury in the case at issue did not necessarily decide on that issue because the evidence was controverted. The indemnification clause in the lease did not confer fee entitlement because plaintiff’s motion did not rely on this clause and the indemnification clause did not speak to fees or expert costs at all.

            Here is the bottom line from the appellate panel in affirming the denial of fees: “Wright should not be permitted to bring a statutory tort claim, omit any mention of attorney fees or otherwise bring into play the lease agreement, and thus not risk being saddled with the State’s attorney fees if he lost at trial; and then, having won, subsequently contend that his claim was based on the lease.” (Slip Op., p. 15.)