Summary Judgment Reversed Based On Alliance Credit Bid Fraud Exception.
Attorneys in Beach Whitman Cowdrey, LLP v. Robertson, Case No. B259718 (2d Dist., Div. 6 May 18, 2016) (unpublished) likely were bummed when the lower court granted a summary judgment in ex-client’s favor and also awarded ex-client $61,208 based on an attorney’s fees clause in a retainer agreement securing the payment of attorneys’ services under a deed of trust against client’s real estate.
What happened was that ex-client became delinquent such that attorneys showed up at a non-judicial foreclosure sale of the secured property, making a credit bid for the property. Attorneys then sued for more money, claiming that ex-client fraudulently misrepresented the value of the property at the time of the retainer inducing them to take the trust deed, only learning after the credit bid that the property was always worth much less anyway (especially much less at the time of the retainer agreement). The appellate court reversed, determining that the summary judgment was improper under the Alliance credit bid fraud exception such that there were triable issues of fact requiring an actual trial—meaning the fee award went POOF! also.