Fee Award Based on Settlement Agreement Fees Clause.
In Daria v. Level Studios, Inc., Case No. B249801 (2d Dist., Div. 6), the defense prevailed in a tenaciously litigated action brought by plaintiff where a trial court ultimately sustained a demurrer and then granted a summary judgment—with many claims dismissed based on releases in a prior settlement agreement between the parties. However, the bad part for plaintiff was that the settlement agreement had a broadly-worded fees clause (“in any dispute arising under this Agreement, the prevailing party shall be entitled to attorneys’ fees and costs, including all expenses reasonably necessary and actually incurred by the prevailing party”). The trial court granted the defense request for $254,886 in fees under Civil Code section 1717.
That result was upheld on appeal.
Although plaintiff argued that the settlement agreement relied on by the trial court had been materially altered, no proof was presented to back up this claim. Plaintiff then griped that defense fees were paid by an insurance defense carrier, but the appellate court observed that fee recovery is still available in such a circumstance. (Lolley v. Campbell, 28 Cal.4th 367, 373 (2002).) The reviewing court found that an average hourly rate of $229.03 per hour for 1112.9 hours of work was reasonable in nature, especially given that plaintiff “tenaciously litigated” the matter.