Trial Court Had Jurisdiction to Award Fees While Merits Appeal Pending and Borrower Was the Prevailing Party.
Borrower on a loan, even after an initial appeal, reduced a loan balance to only $3,602.72 after an offset for usurious interest. The lower court refused to award costs to lender and also awarded $43,960 to borrower based on a fees clause in the promissory note.
Lender appealed, but lost all fees/costs issues in Gilbert v. Wisdom, Case Nos. E047235, E048425 (4th Dist., Div. 1 Feb. 4, 2010) (unpublished).
Lender first argued that the appeal from the merits judgment, before the fee motion was filed, divested the trial court of jurisdiction to hear borrower’s fee motion. Wrong, because numerous courts of appeal have rejected similar arguments. (See, e.g., Robertson v. Rodriguez, 36 Cal.App.4th 347, 360 (1995); Bankes v. Lucas, 9 Cal.App.4th 365, 368 (1992).) Although relying on some isolated language in Butler-Rupp v. Lourdeaux, 154 Cal.App.4th 918, 928 (2007), the Court of Appeal noted that Butler-Rupp, when viewed in context, did not dictate a different result.
Lender next argued that the trial court did not explain the legal basis for the fee award. However, the appellate panel found no court rules or statutes that required such a statement of reasons for ruling on a motion for fees. (Slip Opn., p. 36; Laabs v. City of Victorville, 163 Cal.App.4th 1242, 1272 (2008).)
Lender also contended that borrower did not prevail for Civil Code section 1717 purposes. Wrong again. A lawsuit attacking a note as usurious is an action on the contract for purposes of fee recovery, and borrower reduced a loan balance to minimal proportions.
Lender also challenged the striking of his costs memorandum request. However, this appellate challenge was dismissed because lender failed to appeal 60 days after the service of notice of the costs strike ruling.