Plus, Sublease Fee Clause Failing To Incorporate Master Lease Broader Fee Provisions Also Required Denial Of Fee Request.
In Sancarrow Associates v. Hermanson, Case No. G051276 (4th Dist., Div. 3 Sept. 26, 2016) (unpublished), landlord voluntarily dismissed a contractually-oriented unlawful detainer complaint against sublessees, which prompted them to move to recovery contractual attorney’s fees under a fees clause under the sublease. The trial court denied the fee motion, a result affirmed on appeal.
There were a couple of problems here as far as fee entitlement. First, the sublease fees clause was narrow and did not “dragnet” in the broader Senior Lease fees clause between landlord and primary lessor—which is a hint to all transactional attorneys to make sure “an incorporation by reference” of a broader fees clause is effectuated. Second, Civil Code section 1717 usually immunizes a voluntary dismissal from fee exposure for just a contract claim under Santisas v. Goodin, 17 Cal.4th 599, 616 (1998), but sublessees argued that the attorney’s fees language – “as part of the costs of the litigation” – overrode the voluntary dismissal feature. The 4/3 DCA, in an opinion authored by Acting Presiding Justice Bedsworth, concluded that section 1717 was preemptive on this narrow issue as Santisas recognized.