Fourth District, Division 2 Affirms Fee Award, Even Though $182,469.75 In Fees Were Requested.
Under our category “Requests for Admissions,” we have surveyed cases where courts have granted or refused substantial attorney’s fees award to litigants claiming that they had to prove facts that were unreasonably denied with respect to pretrial discovery requests for admission. Here is a decision where the party seeking RFA sanctions requested $182,469.75 in fees and was awarded only $32,400 in fees, with the latter decision affirmed on appeal.
In Kelly v. LaMunyon, Case No. E044897 (4th Dist., Div. 2 Apr. 23, 2009) (unpublished), plaintiffs, the purported buyers, and defendants, the purported sellers, engaged in protracted, bitter litigation over whether a residential purchase transaction had occurred. The facts were somewhat goofy, but clearly husband on the defendants’ side had never signed a purchase agreement and claimed he knew of no conduct that indicated that he had consented to the sale—after all, the money that was paid was by plaintiffs seeking to enforce a sale was rental for the use of the property by mother of one of the plaintiffs. Also, plaintiff never listed the property as an asset in a chapter 7 bankruptcy petition. (By the way, all of this involved litigation over a City of Canyon Lake condominium unit with a $135,000 purchase price.) Defendants eventually won and sought attorney’s fees for plaintiffs’ denial of RFAs about whether they had entered into an enforceable sales contract with plaintiffs. Defendants asked for $182,469.75 in fees for having to prove facts denied in the RFAs. The trial court only awarded $32,400 in fees against plaintiffs, and neither side challenged the amount of fees awarded by the lower court. Plaintiffs, though, did contest the correctness of the decision to award fees in the first place.
Plaintiffs lost.
The Court of Appeal had no difficulty in concluding that the RFAs went to the heart of plaintiffs’ case, namely, whether there was an enforceable contract (especially covering issues about wife’s authority to sign a purchase agreement on behalf of defendant husband). (BLOG OBSERVATION—The substantive key to this case lies with the statute of frauds. Even though normally both spouses need to sign a purchase agreement to make it effective, part performance or assent by consent can demonstrate that a contract was reached. See, e.g., Crittenden v. McCloud, 106 Cal.App.2d 42 (1951); Rice v. McCarthy, 73 Cal.App. 655 (1925).) Plaintiffs had a very difficult time in arguing persuasively that their denials were reasonable, given that their own pleadings placed the requested facts at issue. The appellate panel found otherwise.
So, in the end, a dispute over a property worth about $135,000 produced a result by which one side got fees of $32,400 (out of a requested $182,469.75), with it likely that both sides still owed their attorneys much, much more for work spent in the overall fray. (BLOG UNDERVIEW—Takes us back to our mantra, the fees are often the tail that wags the litigation dog.)