Second District, Division 4 Parts Company With Dicta in Yassin.
Under our category “Special Fee Shifting Statutes,” we have explored decisions examining the construction prompt payment statutes (most of which are contained in the Civil Code). For example, in Yassin v. Solis, 184 Cal.App.4th 524 (2010) [discussed in our May 7, 2010 post], the Second District, Division 5 in dicta suggested that attorney’s fees are not available to a prevailing party under Civil Code section 3260.1, which penalizes an owner wrongfully withholding a progress payment from a contractor. There is no express attorney’s provision in section 3260.1, although it does reference “the penalty specified in subdivision (g) of Section 3260”—with section 3260, in turn, assessing a 2% per month penalty and allowing the prevailing party to recover attorney’s fees “in any action for the collection of funds wrongfully withheld.”
Now, the Second District, Division 4, in Hinerfeld-Ward, Inc. v. Lipian, Case No. B211257 (2d Dist., Div. 4 Sept. 1, 2010) (certified for partial publication), has expressly parted company with the dicta in Yassin. Instead, after noting that the statutory language in both sections was ambiguous, the panel examined the legislative history of section 3260.1, determining that the Legislature intended to authorize both the penalty and fee recovery to a section 3260.1 prevailing party. This meant that a $200,000 fee award in contractor’s favor was affirmed on appeal.