Fourth District, Division 3 Opinion Demonstrates Interplay Between De Novo and Abuse of Discretion Review Standards on Different Fee Award Issues.
The next case shows how a litigant may convince an appellate court that legal error was committed (de novo review of a fee entitlement issue), but the battle for reversal is lost for failure to surmount an abuse of discretion issue (failure to apportion fees between covered and uncovered fee claims for relief).
In Behnam v. Wilshire Central Escrow, Case No. G041807 (4th Dist., Div. 3 Apr. 22, 2010) (unpublished), plaintiff in a fraud-laden real estate transaction did win damages against a defendant escrow company, but was denied recovery of requested attorney’s fees of $52,240.50. Plaintiff appealed the fee denial.
The Fourth District, Division 3, in a 3-0 decision authored by Acting Presiding Justice Rylaarsdam, affirmed.
Although plaintiff prematurely appealed the order denying fees, it was saved when the appellate court treated it as being taken from the subsequently entered judgment not including the fee award. (Grant v. List & Lathrop, 2 Cal.App.4th 993, 997 (1992).)
The appellate court disagreed with the trial court’s conclusion that there was no fee entitlement (a de novo reviewed issue), given the presence of a contractual fee clause in the escrow instructions introduced into evidence. Although the fee clause was worded to allow recovery only to defendant, Civil Code section 1717 makes it mutual in nature. (Kangarlou v. Progressive Title Co., Inc., 128 Cal.App.4th 1174, 1178 (2005).)
However, that was not the end of the story. The trial court also denied fees because the fee claimant failed to apportion fees appropriately, failing to exclude from its request work on claims against other defendants or causes of action not within the purview of the fees clause. Because plaintiff appealed with a short record that did not clearly show that the requested fees were for interrelated work (Graciano v. Robinson Ford Sales, Inc., 144 Cal.App.4th 140, 157 (2006)), the abuse of discretion tanked plaintiff’s efforts to obtain fees because the need for apportionment is a discretionary lower court call. (El Escorial Owners’ Assn. v. DLC Plastering, Inc., 154 Cal.App.4th 1337, 1365 (2007).)