Second District, Division 7 Affirms the Breadth of Trial Court Discretion.
In Pharmacie Nouvelle, Inc. v. A&G Wilshire, LLC, Case No. B199590 (2d Dist., Div. 7 Dec. 30, 2008) (unpublished), the Second District, Division 7 reminded us that the trial court has considerable discretion in deciding whether to require a prevailing party under Civil Code section 1717 (where there is a contractual fees clause) to apportion fees between contract and noncontract claims. The main exception to the apportionment rule is an important one: no apportionment is required where claims for relief are so “intertwined” that it would be impracticable, if not impossible, to separate the attorney’s time into compensable and noncompensable units.
(See Reynolds Metals Co. v. Alperson, 25 Cal.3d 124, 129-130 (1979) [one of our Leading Cases]; Bell v. Vista Unified School Dist., 82 Cal.App.4th 672, 687 (2000); Abdallah v. United Savings Bank, 43 Cal.App.4th 1101, 1111 (1996) [“intertwinement” exception cases]; El Escorial Owners’ Assn v. DLC Plastering, Inc., 154 Cal.App.4th 1337, 1365 (2007); Erickson v. R.E.M. Concepts, Inc., 126 Cal.App.4th 1073, 1083 (2005); Gonzales v. Personal Storage, Inc., 56 Cal.App.4th 464, 479 (1997) [cases discussing wide breadth of abuse of discretion accorded to trial judge in deciding whether to require fee apportionment].)
The Pharmacie Nouvelle panel decided that no apportionment was required, because the breach of contract claims pervaded the other fraud-based claims. In the end, the appellate court affirmed a trial judge’s award of $156,175.35 in attorney’s fees to a prevailing defendant under section 1717, an award that was $30,000 less (roughly a 16% reduction) from defendant’s full request.