Riverisland Cold Storage v. Fresno-Madera Production credit Assn. CA5 ( 2015 )

Filed 9/28/15 Riverisland Cold Storage v. Fresno-Madera Production credit Assn. CA5
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for
publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication
or ordered published for purposes of rule 8.1115.
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
FIFTH APPELLATE DISTRICT
RIVERISLAND COLD STORAGE INC., et al.,
F069366
Plaintiffs and Appellants,
(Super. Ct. No. 08CECG01416)
v.
FRESNO-MADERA PRODUCTION CREDIT OPINION
ASSOCIATION,
Defendant and Respondent.
APPEAL from an order of the Superior Court of Fresno County. Jeffrey Y.
Hamilton, Judge.
Wild, Carter & Tipton and Steven E. Paganetti for Plaintiffs and Appellants.
Lang, Richert & Patch and Scott J. Ivy for Defendant and Respondent.
-ooOoo-
Plaintiffs appeal from a postjudgment order awarding attorney fees to defendant.
Plaintiffs contend the award included fees that were excessive, duplicative, and
unreasonable. We find no abuse of discretion and affirm.
FACTUAL AND PROCEDURAL BACKGROUND
Plaintiffs sued defendant, alleging in several causes of action that plaintiffs and
defendant negotiated a forbearance agreement, by which defendant agreed to extend
plaintiffs’ existing loans for two years in exchange for plaintiffs’ agreement to put up two
ranches as additional security for the loans. The written agreement defendant prepared,
however, provided for a six-month extension and included plaintiffs’ residence and a
truck yard in the additional security. Plaintiffs signed the written forbearance agreement
without reading it.
Defendant moved for summary judgment, asserting plaintiffs were bound by the
written contract, and parol evidence of an oral agreement to different terms was not
admissible. The trial court granted the motion and entered judgment for defendant. We
reversed, concluding the fraud exception to the parol evidence rule made evidence of the
misrepresentations alleged by plaintiffs admissible. Defendant sought review in the
Supreme Court, which overruled the prior Supreme Court precedent on which defendant
had relied and affirmed our judgment. (Riverisland Cold Storage, Inc. v. Fresno-Madera
Production Credit Assn. (2013) 55 Cal. 4th 1169.)
On remand to the trial court, defendant again moved for summary judgment,
contending plaintiffs were required to show justifiable reliance on defendant’s alleged
oral misrepresentations in order to establish the fraud exception to the parol evidence
rule. It asserted plaintiffs could not do so because the contract set out the material terms
in writing, plaintiffs had the opportunity and ability to read the contract before they
signed it, and plaintiffs simply failed to read the contract. The trial court again granted
summary judgment in favor of defendant. Defendant then moved for an award of
attorney fees pursuant to a provision in the forbearance agreement for recovery of
attorney fees by the prevailing party. The trial court granted the motion, reduced some of
the amounts requested by defendant, and awarded a total of $245,920.50 to defendant.
Plaintiffs appeal the award of attorney fees.
DISCUSSION
I. Standard of Review
In the trial court, “the burden is on the party seeking attorney fees to prove that the
fees it seeks are reasonable.” (Gorman v. Tassajara Development Corp. (2009) 178
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Cal.App.4th 44, 98 (Gorman).) On appeal, however, we presume the judgment is correct
and the appellant must establish prejudicial error. (Id. at p. 67.) The amount of the fee
award is reviewed for abuse of discretion. (Connerly v. State Personnel Bd. (2006) 37
Cal. 4th 1169, 1175.)
II. Award of Attorney Fees
Attorney fees may be awarded to the prevailing party as part of an award of costs,
when an award of fees is authorized by contract. (Code Civ. Proc., §§ 1032, subd. (b),
§ 1033.5, subd. (a)(10)(A); Civ. Code, § 1717, subd. (a).) The fees awarded must be
reasonable in amount and reasonably necessary to the conduct of the litigation. (Code
Civ. Proc. § 1033.5, subd. (c)(2) & (3).) “The amount to be awarded as attorney’s fees is
left to the sound discretion of the trial court. The trial judge is in the best position to
evaluate the services rendered by an attorney in his courtroom; his judgment will not be
disturbed on review unless it is clearly wrong.” (Vella v. Hudgins (1984) 151 Cal. App. 3d
515, 522 (Vella).)
The first step in fee setting is determining the lodestar amount, that is, “the number
of hours reasonably expended multiplied by the reasonable hourly rate…. The lodestar
figure may then be adjusted, based on consideration of factors specific to the case, in
order to fix the fee at the fair market value for the legal services provided.” (PLCM
Group, Inc. v. Drexler (2000) 22 Cal. 4th 1084, 1095 (PLCM).) The factors the trial court
may consider include: ‘““the nature of the litigation, its difficulty, the amount involved,
the skill required and the skill employed in handling the litigation, the attention given, the
success of the attorney’s efforts, his learning, his age, and his experience in the particular
type of work demanded [citation]; the intricacies and importance of the litigation, the
labor and the necessity for skilled legal training and ability in trying the cause, and the
time consumed.”’” (Martino v. Denevi (1986) 182 Cal. App. 3d 553, 558.)
In determining the lodestar figure, the trial court need not specify which fees or
hours it is allowing or disallowing. “‘In California, the trial court has no sua sponte duty
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to make specific factual findings explaining its calculation of the fee award and the
appellate courts will infer all findings exist to support the trial court’s determination.’”
(Taylor v. Nabors Drilling USA, LP (2014) 222 Cal. App. 4th 1228, 1250.) The trial court
is not required to identify each item it found to be unsupported or unreasonable because
“‘“[w]e do not want ‘a [trial] court, in setting an attorney’s fee, [to] become enmeshed in
a meticulous analysis of every detailed facet of the professional representation. It … is
not our intention that the inquiry into the adequacy of the fee assume massive
proportions, perhaps dwarfing the case in chief.’”’” (PLCM, supra, 22 Cal.4th at
p. 1098.)
In its motion for attorney fees, defendant requested total fees of $287,612. The
total was broken down into three segments. Defendant requested $57,627 for the period
through the granting of defendant’s first motion for summary judgment and the entry of
judgment thereon.1 Defendant requested $195,712.50 for the appeals to the Court of
Appeal and the Supreme Court. It requested $34,272.50 for the period after remand to
the trial court, through entry of the second judgment. In support of the fee motion,
defendant submitted detailed billing records for its counsel, Lang, Richert and Patch, and
for a second firm, Dowling Aaron Incorporated, apparently hired as appellate specialists
to assist with the appeal to the Supreme Court. The records showed the number of hours
spent, the tasks performed, and the rate at which each attorney’s or paralegal’s time was
billed.
In opposition, plaintiffs asserted the amount billed for services incurred in
connection with the appeal to the Supreme Court was excessive and duplicative, because
the two firms employed by defendant engaged in similar tasks or participated in the same
tasks. Plaintiffs pointed out that the Dowling firm billed for preparation for oral
1 The amount requested was the amount the trial court awarded as attorney fees in response
to defendant’s motion, which was made after the first judgment was entered and before the
reversal on appeal. Plaintiffs do not challenge this portion of the attorney fee award.
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argument even though the only attorney who appeared for oral argument in the Supreme
Court was Mr. Ivy from the Lang firm. Plaintiffs contended the fees billed for certain
other services were not proper charges.
Plaintiffs also challenged the fees requested for the period after remand, which
included fees for the second summary judgment motion. They contended the motion was
not complex, in that it addressed only the issue of reasonable reliance on defendant’s
alleged misrepresentations, and it materially duplicated matter contained in the first
summary judgment motion, defendant’s brief in the first appeal in this court, and the
reply brief in the Supreme Court.
Finally, plaintiffs asserted the fees for the prior appeal in this court should have
been reduced because the issues, research, and analysis it involved were covered in the
first motion for summary judgment.
The trial court awarded attorney fees in an amount less than that requested by
defendant. It began with the amount defendant requested. It eliminated certain charges it
concluded were for purely clerical or secretarial tasks. It reduced certain charges for
services for the appeal to this court and for preparation of the second summary judgment
motion that it concluded were excessive. The trial court also reduced some charges by
each firm for the Supreme Court appeal, where it found duplication, unnecessary
oversight of other attorneys’ work, and charges for noncompensable clerical work.
In its order awarding attorney fees, the trial court directly addressed points raised
in plaintiffs’ opposition to the motion, and made the deductions it believed necessary to
arrive at reasonable attorney fees for the work performed over the course of the litigation.
In this appeal, the burden is on plaintiffs to demonstrate that the trial court abused its
discretion in its award of attorney fees. (Gorman, supra, 178 Cal.App.4th at p. 98.) In
their opening brief, however, plaintiffs did not attempt to make that showing. Instead,
plaintiffs’ opening brief repeats, often verbatim, the arguments made in its opposition in
the trial court. It complains the amounts defendant requested as fees were excessive and
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duplicative and implores this court to exercise its discretion to reduce them. Our task, of
course, is not to exercise our own discretion to adjust the fees requested by defendant to
an appropriate, reasonable amount, but to review the exercise of discretion by the trial
court.
Plaintiffs’ opening brief graphically illustrates the imprudence of simply
regurgitating the content of a trial court memorandum of points and authorities in an
appellate brief, instead of tailoring the brief to the standard of review applicable in the
reviewing court. Plaintiffs’ opening brief did not address the trial court’s order or the
action the trial court took in reducing certain charges included in defendant’s invoices.
Plaintiffs failed to even acknowledge that the trial court did, in fact, award less than the
amounts requested by defendant, after making the deductions it deemed warranted.
Plaintiffs made no effort to demonstrate that the court abused its discretion by not further
reducing those charges or by failing to reduce other charges.
After defendant, in its respondent’s brief, pointed out these shortcomings in
plaintiffs’ opening brief, plaintiffs attempted to correct the problem in their reply brief.
Ordinarily, we will not consider points raised for the first time in a reply brief; this is a
matter of fairness, because the respondent is deprived of the opportunity to effectively
respond. (Reichardt v. Hoffman (1997) 52 Cal. App. 4th 754, 764.) Because plaintiffs
arguably raised the pertinent issues in the opening brief, although not with adequate
specificity, we will not disregard the arguments made in the reply brief. We find them
unpersuasive, however.
A. Fees for appeals
Plaintiffs seem to suggest the fees for the appeals to this court and to the Supreme
Court should have been reduced because defendant was unsuccessful in those appeals.
When a party is entitled to attorney fees pursuant to a contractual provision which
provides for recovery of attorney fees by the party prevailing in the litigation, that
recovery may include fees for an unsuccessful interim appeal. (Snyder v. Marcus &
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Millichap (1996) 46 Cal. App. 4th 1099, 1103.) The trial court was not required to reduce
the fees awarded because of the unsuccessful interim appeals.
Plaintiffs also assert the services performed for the appeal to the Supreme Court
were substantially duplicative of the services performed in the appeal to this court, so an
award of fees for services connected with the Supreme Court appeal that was 15 times the
award for services in the appeal to this court was excessive and unreasonable. The issues
in the two appeals were substantially different, however.
When the trial court considered defendant’s first motion for summary judgment
and when this court reviewed the judgment entered after that motion was granted, both
courts were bound by existing Supreme Court precedent. The arguments in the trial court
and in this court focused on interpretation and application of prior case law, including
Bank of America etc. Assn. v. Pendergrass (1935) 4 Cal. 2d 258 (Pendergrass).
The Supreme Court, however, was not bound to follow its own precedent. In the
Supreme Court, the parties argued for and against overruling Pendergrass. This required
a different focus and different arguments. Plaintiffs’ assertion that the Supreme Court
services duplicated the Court of Appeal services fails to take this difference into account.
The trial court’s ruling on the attorney fee motion indicates it conducted a detailed
review of the invoices for work performed in the Supreme Court. It reviewed and
reduced the time the Lang firm charged for legal research, as well as revision and editing
of the appellate specialist’s work. It reduced the amount charged for the Lang firm’s
preparation for oral argument, stating that “[t]raining time is not compensable.” The trial
court found the time spent by the Dowling firm on the petition for rehearing, petition for
review, reviewing the record, and conducting research prior to the petition for review was
reasonable, but it reduced the fees for researching and drafting the brief on the merits by
20 percent. It also excluded certain fees for tasks it deemed clerical. Plaintiffs have not
demonstrated that the resulting award of attorney fees in connection with the appeals was
“manifestly excessive in the circumstances.” (Children’s Hospital & Medical Center v.
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Bontá (2002) 97 Cal. App. 4th 740, 782.) Thus, they have not established an abuse of
discretion.
B. Postappeal fees
Plaintiffs contend the fees awarded for the second motion for summary judgment
were excessive because that motion duplicated research, analysis, and writing from the
first motion for summary judgment and the briefs in this court and in the Supreme Court.
They assert defendant was awarded attorney fees “a fourth time for work that was
previously performed.” They do not cite to the specific places in the record where any
such duplication occurred.
The trial court’s ruling discussed the amounts charged for the second summary
judgment motion and the similarity of issues between that motion and the briefs on
appeal. It then reduced the fees for preparation of the motion by approximately one-third.
It also reduced the fees for preparation for oral argument. The total reduction in the fees
for postappeal services was approximately 31 percent. Plaintiffs have not established that
the amount the trial court awarded for postappeal fees was “clearly wrong.” (Vella,
supra, 151 Cal.App.3d at p. 522.) Thus, they have not demonstrated an abuse of the trial
court’s discretion.
DISPOSITION
The April 10, 2014, order awarding defendant attorney fees is affirmed.
Defendant is entitled to its costs on appeal.
_____________________
HILL, P.J.
WE CONCUR:
_____________________
LEVY, J.
_____________________
FRANSON, J.
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