Multiple Challenges To Entitlement/Fee Amount Rejected Upon Review.
In Palmer v. Patel, Case No. H039336 (6th Dist. Dec. 30, 2014) (unpublished), parties got involved in a brouhaha over a vacation home even though a real estate purchase agreement and deed of trust had broad attorney’s fees clauses. Plaintiffs lost the case and were hit with fees by various defendants under Civil Code section 1717, all to the tune of $340,567.55 (inclusive of some costs also) even after some reductions by the lower court.
This prompted an appeal by the plaintiffs, which raised multiple 1717 challenges.
None of these challenges was successful on appeal.
Among other things, plaintiffs had a declaratory relief claim which was enough for contractual entitlement under section 1717.
Plaintiffs argued that the transaction was illegal, but this did not carry the day because the underlying residential sale was just fine, even if there were title problems and because the defense was not in pari delicto to boot.
Even though certain nonsignatory defendants were sued, section 1717 was proper because those nonsignatories would have been liable had the result gone the other way, with the court citing successor liability, alter ego, and third-party beneficiary cases to the same effect.
A Santa Clara attorney with 37 years experience charging $400 per hour was seen as charging a reasonable hourly rate by both the lower and appellate courts.
With respect to block billing entries, they were not deemed objectionable per se, with the lower court having discretion to penalize accordingly (including to deny fees altogether), with the reduction in fees showing that some penalty was allotted in this one.