Fees Were Less Than Requested Based on Defendants’ Excessive Litigation Style, But Were Justified Because Plaintiff Did Everything Possible Not To Pay Under the Settlement.
Civil Code section 1717 fee proceedings are equitable in nature. Don’t think for one moment that trial judges presiding over fee motions do not factor in each side’s conduct (during the litigation and in performing any settlement) when making their decisions. This next case so shows, and it a nice compliment to Peak-Las Positas Partners v. Bollag, 172 Cal.App.4th 101 (2009) [discussed in our March 16, 2009 post] [aggressive/tenacious litigation is a proper 1717 factor to weight in the decision making process].
Katofsky v. Beitler, Case No. B233743 (2d Dist., Div. 2 Oct. 4, 2012) (unpublished) is a situation where plaintiff and defendants entered into a settlement enforceable under CCP § 664.6, containing an attorney’s fees clause which would be triggered if any enforcement proceeding and specifically retaining jurisdiction to enforce the settlement with the settlement judge. The specific settlement judge refused to entertain a post-settlement request to enforce the settlement or award attorney’s fees for nondisclosed reasons. However, the assigned superior court judge did both, granting defendants’ motion to enforce the settlement and awarding them $110,000 (out of a requested $200,000) in attorney’s fees, mainly in the aftermath of plaintiff’s failure to pay a hefty couple of million initial payment under the settlement agreement. Plaintiff appealed.
The merits and fee rulings were affirmed on appeal.
Plaintiff argued that exclusive jurisdiction to enforce the settlement and to entertain fee requests was vested with the specific settlement judge. This one failed, because jurisdiction generally lies with the entire superior court, not just one particular judge. Alternatively, if the specific settlement judge provision was enforced, it was an invalidity situation which could be severed out based on a severability clause in the settlement agreement.
The appellate court also found the 664.6 enforcement motion was a type of proceeding that fit within the CCP § 22 definition of an “action”.
That brought the appellate panel to the reasonableness of the fee award. No problem here, because the trial court did not abuse its discretion for these reasons: (1) it made reductions for the defense efforts in seeking relief unavailable to defendants; (2) it made reductions for defendants’ chosen excessive litigation style (aka “no holds barred”); (3) it made reductions for defense attorneys’ vague time entries; and (4) it positively factored in plaintiff’s performance in trying to avoid payment obligations at every turn. Fee award affirmed, with pragmatic factors driving the amount awarded.