First District, Division 4 Discusses Brandt And Routine Costs In Catholic Priest Molestation Insurance Dispute.
Howard v. American National Fire Ins. Co., Case Nos. A121569 & A123187 (1st Dist., Div. 4 Aug. 11, 2010) (certified for publication) is a virtual primer for insurance litigators, involving substantial upholding of a substantial bench trial award against an insurer for bad faith failure to defend, settle and indemnify a case involving an insured bishop who retained a priest in a Catholic diocese accused of molesting a third party plaintiff. However, the decision also discusses Brandt recovery of fees and some postjudgment routine cost awards. That is where we pick up.
Brandt [one of our Leading Cases] is a California Supreme Court case holding that an insured can recovery attorney’s fees in a bad faith insurance action as long as the fees were incurred to recover policy benefits. (Actually, the fees are recovered as damages in those situations.) Here, the trial court reviewed detailed time records, concluded that 57.44% of the attorneys’ time was attributable to insurance policy contract claims, and awarded half because the contingency fee contract with plaintiffs promised 50% of any total recovery to the attorneys. This came to $661,719.97 as fee “damages.” Although carrier challenged the computation on appeal, the First District, Division 4 found no error, determining the court had properly allocated out non-contract work and followed the post-Brandt methodology for calculation approved in Cassim v. Allstate Ins. Co., 33 Cal.4th 780, 811-812 (2004).
That brought the appellate court to some attacks of the total costs awarded to plaintiffs in the amount of $93,827.07. The first item challenged was $46,542.32 for plaintiffs’ fees paid to a private JAMS judge, an item that had to be reversed based upon the parties’ agreement to split the cost of the JAMS judge equally (“divided and borne” language in their agreement). Deposition costs of $44,588.78 were sustained, because all of the depositions were intertwined in the claims against the defendant insurer and no authority supported allocating costs to a codefendant for whom litigation remained pending. The trial court correctly did not award $9,400 in expert witness expenses, because the witness was not a court-ordered witness. Finally, $2,368 in attorney meals for an out-of-town attorney attending a deposition was a properly allowable cost in the discretion of the trial judge. (Code Civ. Proc., § 1033.5(a)(3).) The Howard court refused to interpret Ladas v. California State Automobile Assn., 19 Cal.App.4th 761, 774-775 (1993) as establishing an absolute rule prohibiting reimbursement for attorney meal expenses “under any and all circumstances,” with meal expenses being “reasonably necessary” for out-of-state counsel who attends a local deposition if the lower court finds they are appropriate.