Two Appellate Courts Show That Fees May Rise and Fall With Later Dispositions.
Arbitration—Burlage v. Superior Court, Case No. B211431 (2d Dist., Div. 6 Aug. 31, 2009) (certified for publication)
This case is going to attract attention, because Presiding Justice Gilbert (author of a 2-1 majority opinion) has taken on the principle that Moncharch v. Heily & Blasé, 3 Cal.4th 1 (1992) prevents review of erroneous legal rulings that substantially prejudice an arbitration participant.
The facts are interesting, to say the least. Claimants purchased a house from respondent in a gated community next to a country club. (What else? Do you think ordinary people can afford lawyers in non-contingent matters like this involving a donnybrook between embittered neighbors?) The whole dispute boiled down to an encroachment claim, although couched in intentional fraud clothing. Even though the title company paid the country club $10,950 in exchange for a lot line adjustment giving claimants title to the encroaching land, claimants still pressed ahead with their encroachment claim. Claimants were successfully granted a motion excluding introduction of the title company lot line adjustment payment, and pressed forward on their tort claims. Lo and behold, the arbitrator eventually awarded claimants $552,750 in compensatory damages, $250,000 in punitive damages, and $732,570 in attorney’s fees and costs in favor of claimants based on value diminution theories. (So, yes, now you know why we are reporting on this one—fees were involved.) Claimants moved to confirm the award, and respondent moved to vacate the award.
The trial court vacated the award, and the appellate panel affirmed—finding that the exclusion of the lot line adjustment evidence (showing claimants got what they wanted based on a minimum payment by a third party) was a material exclusion that substantially prejudiced the respondent so as to justify vacating the award. Justice Perren, in dissent, believed that the appellate court was bound by Moncharch, with the erroneous legal ruling not reviewable on the merits. The majority, however, saw things differently. Result: POOF! The substantial attorney’s fees award went away, pending further appellate petitions that will likely follow.
FAVORITE BLOG QUOTE FROM MAJORITY OPINION—“We look to legal precedent in deciding cases. We believe the law is predictable and provides litigants and counsel a reasonable degree of certainty. True, but not always.”
CEQA and Private Attorney General Statute—The Committee of 1000 v. Palm Springs Unified School Dist., Case No. E046422 (4th Dist., Div. 2 Aug. 31, 2009) (unpublished)
In this one, the appellate court reversed a CEQA writ of mandate in favor of Committee. Before this reversal, the lower court had awarded Committee attorney’s fees and costs in the respective amounts of $58,461 and $2,006 based upon Code of Civil Procedure section 1021.5 (private attorney general statute).
With the reversal came a POOF! The attorney’s fees award was reversed based on the reversal of the judgment ordering issuance of a writ of mandate. (See National Parks & Conservation Assn. v. County of Riverside, 81 Cal.App.4th 234, 238 (2000) [claimants was not successful under section 1021.5 with a reversal of the writ of mandate].)