Indemnity/Section 1717: Indemnity Fee Award Affirmed; Section 1717 Award Reversed After Voluntarily Dismissal of Some Claims

 

Longstanding Case May Be Finally Resolved Except for Appeal Costs for Two Parties.

     In our February 20, 2009 post, we looked at a complicated, multi-party construction dispute that produced some interesting fee rulings. That case was Jeld-Wen, Inc. v. Pacific Coast Roofing Corp. Because the 2009 appellate opinion remanded for reconsideration of certain issues, the close-to-final chapter to the litigation saga looks like it has come down in Jeld-Wen, Inc. v. Pacific Coast Roofing Corp., Case No. D056204 (4th Dist., Div. 1 Nov. 17, 2011) (unpublished)–a 72-page opinion whose highlights we now summarize.

     Certain fee awards under the indemnity costs provisions of Code of Civil Procedure section 1038 were affirmed. Earlier, they were reversed because a summary adjudication (versus summary judgment) does not give rise to entitlement under section 1038. However, after remand, a development occurred in the form of a voluntarily dismissal of a remaining claim that effectively turned the summary adjudication into a summary judgment. So, the defense indemnity costs were appropriate. The dismissal did not deprive the trial court of the ability to adjudge fee requests, and the cost award was still recoverable even though an insurance carrier paid those costs (put another way, they were still “incurred” under Lolley v. Campbell, 28 Cal.4th 367, 373 (2002)). Also, attorney declarations on time expeded were sufficient, since contemporaneous time records are not a substantiation requirement in state court cases–unlike the counterpart rule in federal courts. (Martino v. Denevi, 182 Cal.App.3d 553, 559 (1986).)

     However, the section 1717 fee award had to be overturned, because the voluntary dismissal did preclude such an award under section 1717. (Kelley v. Bredelis, 45 Cal.App.4th 1819, 1837 (1996).)

    Although there are other tidbits on somewhat unique procedural issues, these are the highlights — did we do good on summarizing a 72-page decision? However, two parties did get costs on appeal (which might include fees), so there may be one more appeal in the hopper for us to blog on in the future.

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