Opinion
G055112
04-30-2018
CLAUDE KNAFO, Plaintiff and Appellant, v. COLLECTORS UNIVERSE, INC., Defendant and Respondent.
Herbert Abrams, for Plaintiff and Appellant. Attlesey, Storm, and Keith A. Attlesey and John P. Ward, for Defendant and Respondent Collectors Universe, Inc.
NOT TO BE PUBLISHED IN OFFICIAL REPORTS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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115. (Super. Ct. No. 30-2015-00772786) OPINION Appeal from an order of the Superior Court of Orange County, Deborah C. Servino, Judge. Affirmed. Herbert Abrams, for Plaintiff and Appellant. Attlesey, Storm, and Keith A. Attlesey and John P. Ward, for Defendant and Respondent Collectors Universe, Inc.
Claude Knafo appeals from an order awarding $66,103 in attorney fees to Collectors Universe, Inc., a company that grades the quality of sports trading cards. Knafo's sole contention on appeal is that the trial court erred by awarding Collectors the attorney fees it incurred in defense of Knafo's complaint, rather than confining its award to the fees incurred in connection with Collectors' cross-complaint. According to Knafo, because his complaint contained no reference to any contractual attorney fee claim, it could not give rise to such a claim on behalf of his opponent.
We affirm the order. As the trial court made clear in its ruling, the attorney fee provision in the applicable agreement is broadly worded, governing any "action to enforce the terms and conditions of [the agreement] or otherwise arising under or with respect to [it]." Because the guarantee Knafo sought to enforce in his complaint was itself an aspect of that same agreement, the complaint necessarily triggered application of the agreement's attorney fees clause. The fact Knafo himself did not seek an award of contractual fees in his complaint did not preclude Collectors from doing so.
FACTS
As set forth in more detail in our unpublished opinion in the related appeal, Knafo v. Collectors Universe, et al., (Apr. 30, 2018, G054661) (Knafo I), this fee dispute is an aspect of litigation arising from Collectors' grading of a 1972 Julius Erving trading card (the Erving card).
Knafo submitted the Erving card to Collectors in accordance with the terms of its written submission agreement. Collectors graded the card and returned it to Knafo encased with a label that incorrectly described the Erving card as having been graded a perfect "Gem Mint 10." Within two weeks, Collectors realized the grade described on the card's label was incorrect and requested Knafo return it for correction as required by the submission agreement.
Knafo refused to return the Erving card and instead filed a complaint against Collectors. He alleged that pursuant to the written guarantee also referenced in the submission agreement, Collectors was obligated to compensate him for value the Erving card would have had with the grade of Gem Mint 10.
Collectors answered the complaint, relying on the terms of the submission agreement as an affirmative defense. Collectors also filed a cross-complaint, seeking specific performance of the submission agreement's requirement that Knafo return the Erving card to it for correction of the erroneous grade. (Knafo I, supra, G054661.)
Collectors then moved for summary adjudication on both the complaint and the cross-complaint. The trial court ruled in its favor and subsequently entered a judgment requiring Knafo to return the Erving card for correction of the Gem Mint 10 grade listed on its label. (Knafo I, supra, G054661.)
Following entry of the judgment, Collectors moved for an award of attorney fees. It relied upon the submission agreement which states in pertinent part: "The parties hereby consent to personal jurisdiction of the courts of the State of California with respect to any legal action to enforce the terms and conditions of this Agreement or otherwise arising under or with respect to this Agreement . . . . Each [further] agrees that the prevailing party shall be entitled to an award of its reasonable attorney's fees, costs and expenses."
Knafo opposed the motion, arguing there was no right to recover contractual attorney fees in connection with his complaint because the complaint itself included no claim for any such fees.
However, in granting the motion, the trial court noted that Collectors not only invoked the terms of the submission agreement as the basis for its cross-complaint, it also pleaded that agreement as an affirmative defense in its answer to the complaint and expressly sought an award of contractual attorney fees in connection with it: "In its affirmative defenses, [Collectors] raised issues requiring interpretation of the Terms & Conditions. (5/2/2016 Answer at pp. 7-8.) Additionally, in its Answer, [Collectors] requested: 'That this answering Defendant be awarded its attorneys' fees and litigation costs incurred in this action.' (05/02/2016 Answer at pp. 7-8.)"
The court's minute order reflects it awarded slightly less than the amount of fees requested, reducing the amount from $66,673 to $66,103. It does not explain the minor reduction. --------
Moreover, the court explained: "The fee provision provided in paragraph 13 of the [submission agreement] is broad, encompassing 'any legal action to enforce the terms and conditions of this Agreement or otherwise arising under or with respect to this Agreement.' [¶] . . . [¶] Furthermore, broadly-phrased fee provisions like the one here, can support an award for fees in litigation, whether it sounds in tort or in contract." ~(ct153)~ And finally, the court reasoned that "[b]ut for the execution of the Submission Agreement in connection with his submission of the card for grading, Plaintiff would have no basis for his claim that Defendant interfered with, breached an express warranty, or conspired to deprive Defendant's potential to sell a 'grade 10' card."
DISCUSSION
Knafo's challenge to the attorney fee award is narrow. He does not challenge the reasonableness of the fees claimed by Collectors, the propriety of any particular charge, or the court's determination that Collectors is the prevailing party. Instead, his sole claim of error is that "since the Complaint and amendments thereto did not involve an attorney's fees claim under Civ. Code § 1717 and the first mention of such a claim was asserted in the Cross-Complaint, the Cross-Complaint only should be the basis for an attorneys' fees clause . . . ."
We review this claim de novo. "'On review of an award of attorney fees after trial, the normal standard of review is abuse of discretion. However, de novo review of such a trial court order is warranted where the [issue is] whether the criteria for an award of attorney fees and costs in this context have been satisfied . . . .'" (Connerly v. State Personnel Bd. (2006) 37 Cal.4th 1169, 1175.) Moreover, whether a contractual attorney fee clause provides for a fee award in a particular case is a question of contract interpretation. And "[t]he interpretation of a contract, including the resolution of any ambiguity, is solely a judicial function unless the interpretation turns on the credibility of extrinsic evidence." (American Alternative Ins. Corp. v. Superior Court (2006) 135 Cal.App.4th 1239, 1245.)
The claim is not persuasive. Knafo's claim ignores not only the trial court's analysis but also the cases the court relied upon in support of its ruling. Instead, Knafo cites a single case, Turner v. Schultz (2009) 175 Cal.App.4th 974, 979-980 (Turner). But Turner undermines, rather than supports, Knafo's point.
Indeed, the pinpoint reference Knafo relies upon states: "We first reject Turner's contention that the action was not 'on the contract.' California courts construe the term 'on a contract' liberally. '"As long as the action 'involve[s]' a contract it is '"on [the] contract"' within the meaning of section 1717. [Citations.]" [Citations.]' [Citation.] Where an attorney fee clause provides for an award of fees incurred in enforcing the contract, the prevailing party is entitled to fees for any action 'on the contract,' whether incurred offensively or defensively. [Citations.] Such fees are properly awarded under section 1717 'to the extent that the action in fact is an action to enforce—or avoid enforcement of—the specific contract.'" (Turner, supra, 175 Cal.App.4th at pp. 979-980.)
In any event, whether Knafo understood it or not, his attempt to enforce Collectors' guarantee constituted an effort to enforce the terms of the submission agreement. The agreement specifically incorporates the guarantee, identifying it as the sole measure of Collectors' potential liability "for the grade assigned by [Collectors] to any card." And the submission agreement also contains an integration clause, stating its terms and provisions "constitute the entire agreement of [Collectors] and Customer (and any third party for whom Customer may be acting) regarding, and supersede all prior agreements and understandings (written or oral) between or among such parties relating to, the subject matter hereof."
Thus, as between the customer who submits a card for grading (i.e., Knafo), and Collectors, the guarantee is not a separately enforceable agreement. It is enforceable only as an aspect of the submission agreement. Consequently, Knafo's attempt to claim the benefits of that guarantee was an effort to enforce the submission agreement, which triggered application of that agreement's attorney fees clause.
And finally, as Collectors points out, when attorney fees are "'incurred for representation on an issue common to both a cause of action in which fees are proper and one in which they are not allowed,'" they need not be apportioned. (Quoting Wilshire Westwood Associates v. Atlantic Richfield Co. (1993) 20 Cal.App.4th 732, 747.) In this case, as Knafo himself asserted in Knafo I, liability turned on a single issue; i.e., whether Collectors' right to demand a return of the Erving card pursuant to the submission agreement's correction provision trumped Knafo's right to collect damages under the guarantee. Both Collectors' defense to the complaint and its prosecution of the cross-complaint turned on that one issue; hence, we presume that whatever fees it incurred were incurred in connection with both. Consequently, neither Collectors, nor the trial court, would have been obligated to parse those fees as between the two.
For all of these reasons, we find no error in the trial court's award of attorney fees incurred by Collectors in connection with the complaint.
DISPOSITION
The judgment is affirmed. Collectors is awarded its costs on appeal, including reasonable attorney fees incurred in connection with both this appeal and its related appeal (Knafo I, supra, G054661). The case is remanded to the trial court with directions to determine the amount of such fees.
GOETHALS, J. WE CONCUR: BEDSWORTH, ACTING P. J. ARONSON, J.