In Savas v. Gerber, Case Nos. B236101/B237539 (2d Dist., Div. 1 Apr. 18, 2013) (unppublished), a three-eighths owners of a loan was disappointed when they did not receive a fee recovery against five-eighths owners after the nonjudicial foreclosure of some property in which they had proportionate loan holdings. Their appeal was unsuccessful, too.
The main reason was the lack of an attorney’s fees provision in any contract between the two sides, especially since the fees clauses in the deed of trust and promissory note only allowed for payment of fees by the borrower, not a fellow beneficiary/lender. De novo appellate review confirmed this conclusion, because (1) the five-eighths owners were not parties to a settlement agreement or action producing the agreement in a quiet title against borrowers; (2) no “practical liability” fee recovery was justified under Saucedo v. Mercury Sav. & Loan Assn., 111 Cal.App.3d 309 (1980) given that five-eighths owners were not akin to “nonassuming grantees”; (3) appellant was not a “third party beneficiary” to a promissory note secured by a second trust deed or pursuant to the reasoning of Real Property Services Corp. v. City of Pasadena, 25 Cal.App.4th 375 (1994); (4) no “equitable provisions” allowed for fee recovery–even though the initial statement of decision did say there was possible recovery between the two sides, the lower court later denied them after finding no support for such an award.
Fee denial affirmed, in a 3-0 opinion authored by Presiding Justice Mallano.