The Dismissed Claims Were “On The Contract” Under Civil Code Section 1717.
We think that sometimes litigants and practitioners do not appreciate that Civil Code section 1717’s definition of “on the contract” is liberally construed, meaning that even tort claims based on contractual documents frequently will give rise to fee exposure. JAJ3, LLC v. Bren, Case Nos. B333853/B339029 (2d Dist., Div. 3 Feb. 10, 2026) (unpublished) illustrates this reality.
There, plaintiff eventually lost a case after not prevailing against defense demurrers, with the trial court reasoning that the claims were barred by judicial estoppel and claim splitting and did not state legally cognizable causes of action. Even though the prevailing defendant was not a party to certain operating agreements, plaintiff sued defendant as if he was. The lower court granted section 1717 fees of $97,965 out of a requested $165,008.
Plaintiff’s appeal of the merits decision and fee award were both unsuccessful. Because the tort causes rested on allegations that a party breached a duty created by contract, this was sufficient to show section 1717 “on the contract” fee entitlement. (Kangarlou v. Progressive Title Co., Inc., 128 Cal.App.4th 1174, 1178-1179 (2005).) With respect to the argument that defendant could not be awarded fees because he was not a signatory to the agreements, that was rejected because section 1717 establishes mutuality because plaintiff, had it prevailed, would have been entitled to fees against defendant—so the same way, vice versa.