Fee Substantiation Issues Do Not Preclude An Award Of Fees To Prevailing Parties.
In Asphalt Professionals, Inc. v. Emaron Homes, LLC, Case No. B261674 (2d Dist., Div. 6 Jan. 20, 2016) (unpublished), plaintiff lost a case against certain defendants (some of whom were sued as alter egos) under a construction contract with a fees clause. After the appellate court earlier reversed a determination that defendants’ fee petition was untimely, three defendants moved to recover fees of $613,767.43 against plaintiff. The trial court awarded fees of $390,000 to all three defendants, but stayed the order as to one corporate defendant whose corporate status was suspended.
Plaintiff’s appeal was unsuccessful.
The main challenge was to the fee substantiation, because declarations were not separately provided by attorneys working the matter. Although recognizing that “[a] better practice would have been for each attorney to file a separate declaration attached to their own time and billing records,” the appellate court did observe that flaws in the supporting evidence did not deprive the trial court of its discretion to determine a reasonable fee award. The size of the award was no abuse of discretion because the trial judge made a substantial reduction in the requested amount. Plaintiff then argued that fees had to be apportioned because counsel represented up to 16 defendants at one time, the “unity of interest” reduction rule. Here, however, petitioning counsel made a smart move in voluntarily reducing fees to take the multiple representation of other parties into account, an approach found attractive by both the trial and appellate courts. Finally, it was no abuse of discretion to stay fee recovery as to the disenfranchised corporate entity given that a suspected corporation cannot pursue litigation for failure to pay taxes.