Declaratory Relief Count Was Contractual; Fee Clause Did Encompass Nonsignatory Defendants As Far As Fee Recovery.
Fresno, California has a fairly large Hmong population, and this next case was a contractual battle between corporate parties and officers/directors where plaintiffs eventually dismissed their case against prevailing party defendants pursuant to stipulation after failing to amend after a demurrer was sustained. Based on a broadly worded fees clause, the lower court awarded prevailing defendants $88,742.47 in fees (although denying a multiplier request) in Vue v. Hmong Internat’l New Year Foundation, Case No. F066204 (5th Dist. Feb. 4, 2014) (unpublished).
The fee award was affirmed on appeal, in a 3-0 decision authored by Justice Pena.
The declaratory relief count was “on the contract” for purposes of Civil Code section 1717. Beyond that, prevailing nonsignatory defendants have the right to recover fees under 1717 if they stand in the shoes of the contracting parties, and this was the case because the fees clause also encompassed “rights and duties of any relation thereto” (meaning other personal parties to the contract like the individuals). Also, the nonsignatory parties were third party beneficiaries based on the wording of the clause and relationship of the individuals to the public benefit corporate defendants.
Some of the hundreds of participants at the 10th-annual Hmong New Year Celebration in downtown Chico, California, pose. 2012. Carol M. Highsmith, photographer. Library of Congress.