From Casetext: Smarter Legal Research

McKinzie v. Roemer

California Court of Appeals, First District, Second Division
Jul 1, 2010
No. A124787 (Cal. Ct. App. Jul. 1, 2010)

Opinion


SCOTT MCKINZIE, Plaintiff and Respondent, v. PAULA ROEMER, Defendant and Appellant. A124787 California Court of Appeal, First District, Second Division July 1, 2010

NOT TO BE PUBLISHED

Alameda County Super. Ct. No. RG07332672

Kline, P.J.

INTRODUCTION

Defendant Paula Roemer appeals from an order of the Alameda County Superior Court awarding attorney fees to plaintiff Scott McKinzie on his successful contract claim against her. Roemer challenges both the award of fees and the amount. She contends: (1) the court erred in awarding attorney fees of $281,058 to McKinzie as the prevailing party under an indemnification provision in the contract in the absence of a direct action for indemnification; and (2) the court abused its discretion in awarding fees incurred for claims McKinzie had voluntarily dismissed and in basing its award on billing rates unsupported by competent evidence. We shall affirm the attorney fee award.

FACTS AND PROCEDURAL BACKGROUND

In March of 2006, Dr. Roemer sold her Oakland dental practice to Dr. McKinzie. As part of the sales agreement, Roemer agreed to pay McKinzie $500 per patient for any patient from her Oakland dental practice that she continued to treat more than once in her Walnut Creek practice. In the months that followed, Roemer treated at least 181 Oakland patients in her Walnut Creek practice more than once without notifying McKinzie and without compensating him. She later admitted to treating 60 patients.

On June 26, 2007, McKinzie sued Roemer, alleging claims for breach of contract, breach of the implied covenant of good faith and fair dealing, intentional misrepresentation, concealment, false promise, and negligent misrepresentation. The complaint sought attorney fees in connection with the contract claim. Following an unsuccessful demurrer, Roemer answered the complaint, denying the allegations and requesting recovery of her legal fees as part of her costs of suit. During discovery, Roemer admitted to treating 181 patients (121 patients more than those she had previously disclosed and for which she had previously paid.) McKinzie moved for summary adjudication that Roemer owed a contractual duty to pay $500 liquidated damages under the contract for each of these patients. On July 8, 2008, Roemer issued a Code of Civil Procedure section 998 offer for $62,001. The offer was conditioned upon the parties mutually waiving statutory costs and attorney fees incurred in the action. On July 9, 2008, the trial court entered an order granting a motion for summary adjudication in favor of McKenzie, ruling that Roemer had a contractual duty to pay $500 per patient for each of the 123 patients (later reduced to 121 patients) she admitted treating in her Walnut Creek practice more than once. The court expressly did not make a determination as to whether Roemer was in breach of the contract.

On July 14, 2008, McKinzie dismissed without prejudice his four fraud claims, leaving only the breach of contract and breach of implied covenant claims for trial. The jury subsequently determined Roemer’s conduct constituted a breach of the sales contract and awarded McKinzie $60,500 in contract damages.

McKinzie moved to recover $257,206.50 in attorney fees and costs. In their fee motion, counsel for McKinzie stated that the motion “specifically excludes fees and costs relating to Plaintiff’s fraud claims (i.e., discovery relating exclusively to fraud, expert witness fees and costs relating to fraud damages).” They asserted that fraud-related discovery constituted only a fraction of the total discovery. Roemer noticed depositions of McKinzie and his legal counsel and demanded production of documents to determine the reasonableness of McKinzie’s attorney fees and costs. Further motion practice regarding the fee motion and opposition thereto followed. These included, but were not limited to, a hearing on Roemer’s motion to compel and for sanctions, resulting in the issuance of a protective order in favor of McKinzie’s counsel. McKinzie claimed to have incurred an additional $62,433 in attorney fees and costs in connection with these posttrial motions, which he added to his pending fee motion.

This is $257,446.50 less the amount of $240 discovered to be erroneously listed on the invoice.

In opposing the fee motion, Roemer argued that the sales contract did not contain a prevailing party attorney fee provision. She further argued that the costs and fees requested by McKinzie should be modified to reflect only costs spent on the causes of action for breach of contract and breach of the implied covenant. Roemer maintained that the fee request was not reasonable, because the sum sought was four times the amount at stake in the contract claim; the block billing entries of attorney time lumped together work on multiple tasks and failed to segregate time worked on the fraud-related claims; there was an insufficient showing that McKinzie’s counsel’s billing rates were comparable to rates for attorneys in the Bay Area; and McKinzie unnecessarily had two attorneys present during trial.

On February 25, 2009, following a hearing on the fee motion, the court issued its order granting in part McKinzie’s motion for attorney fees and denying Roemer’s motion to tax costs. The court awarded McKinzie attorney fees of $218,625 in connection with the contract claims and $62,433 in connection with the bringing of the fee motion and the related discovery disputes, for a total of $281,058 in attorney fees. The court also awarded McKinzie other costs in the amount of $10,290.69. The court found that McKinzie was the “prevailing party” in the action and therefore entitled to reasonable attorney fees as costs pursuant to Code of Civil Procedure section 1032. The court further found that “[r]egardless of whether Article 26 of the contract is categorized as an ‘indemnification’ provision or an ‘attorney’s fees’ provision, ... it clearly authorizes an award of the attorney’s fees that are the subject of [McKinzie’s] motion.”

The court rejected Roemer’s claim that McKinzie was not entitled to costs because he turned down the Code of Civil Procedure section 998 offer and failed to obtain a more favorable judgment at trial, pointing out that Roemer’s offer was not more favorable than the result obtained at trial because preoffer costs and statutory or contractual attorney fees are added to the award of damages in determining whether the plaintiff obtains a judgment more favorable than the defendant’s offer. (Duale v. Mercedes-Benz USA, LLC (2007) 148 Cal.App.4th 718, 725, fn. 3.) ~(AA 635)~

Responding to Roemer’s challenges to the amount of fees sought, the court found that most of the fees and costs set forth on the detailed invoices submitted by McKinzie’s counsel “were reasonably incurred in connection with [Roemer’s] breach of or failure to perform her warranties or covenants in the sales contract.” Although the fees were high in comparison to the verdict, the court concluded they were “not unreasonable for the services that were required to be done in connection with the claims seeking enforcement of the... sales contract.” The court found that McKinzie’s counsel had not sought reimbursement for fees solely related to the fraud claims, but that the work for which recovery was sought “relates either directly to litigation of the contract claims or is so intertwined with the litigation of those claims that segregation would be impracticable. [Citations.]” The court found attorney fees were “reasonable under all of the circumstances, based (among other things) on the Court’s careful consideration of the detailed invoices and descriptions of services and the Court’s knowledge and experience with respect to the prevailing market rates of lawyers representing clients in the Alameda County Superior Court with similar skills as [McKinzie’s] counsel.”

The court also explained that it had reduced the $257,206.50 sought by McKinzie on the contract claims by approximately 15 percent “to account for the concerns about reasonableness raised” in Roemer’s opposition papers. These included: “(1) work that [Roemer] contend[ed] was inefficient or duplicative, including having two attorneys appear throughout the trial; (2) ‘block billing’ entries and/or descriptions that ma[d]e it difficult to determine how much time was spent on each task and whether any such time was spent solely on the fraud claims; and (3) a reasonable deduction for entries (such as drafting discovery requests) that included requests going to fraud as well as breach of contract claims.” Finally, the court found that “[a]ny further reductions from the amounts sought are not warranted, especially in light of [Roemer’s] strategic decision to litigate this case heavily at each turn rather than attempting to minimize the amount of work required to be done by [McKinzie]. Although [Roemer] complains that the amount of attorney’s fees is disproportionate to the amount of liability determined at trial, [she] did not at any time concede issues of liability under the contract or otherwise seek to streamline the case, effectively forcing [McKinzie] to expend substantial resources in establishing [Roemer’s] liability on summary adjudication and at trial. [Citation.]”

According to the court, not only did Roemer rebuff efforts to resolve the dispute before filing of the complaint, but “[Roemer’s] tenacious approach included, among other things: (1) asserting that the ‘$500 per patient’ covenant... of the contract was unenforceable; (2) asserting that [her] obligation under that provision was negated because [McKinzie] caused the patients to migrate to her Walnut Creek practice; (3) filing a demurrer to the complaint that was overruled; (4) resisting discovery efforts that required [McKinzie] to file two substantially successful motions to compel; (5) engaging in extensive post-trial discovery into the attorney’s fees invoices and related matters that resulted in motion practice because of the overbreadth of some of [Roemer’s] requests.”

On March 23, 2009, Roemer timely appealed the trial court’s order awarding fees.

DISCUSSION

I. Entitlement to Attorney Fees

A. The contract provision

The court awarded attorney fees pursuant to Code of Civil Procedure section 1032 based on its reading of Article 26 of the sales contract between the parties. That article provides in relevant part as follows: “Article 26. Liability: Indemnity [¶] “26.01 Seller shall indemnify, defend, and hold Buyer harmless against and in respect of any and all claims, demands, losses, costs, expenses, obligations, liabilities, damages, recoveries, and deficiencies, including interest, penalties, and reasonable attorney’s fees that Buyer may incur or suffer which arise, result, or relate to any breach of, or failure by Seller to perform, any of [her] representations, warranties, or covenants in this Sales Contract....” (Italics added.)

In its entirety, the article provides:

Section 26.01 of the contract is followed by section 26.02, in many respects the mirror image of the foregoing provisions, the first sentence of which states: “Buyer shall indemnify, defend, and hold Seller harmless against and in respect to any and all claims, demands, losses, costs, expenses, obligations, liabilities, damages, recoveries, and deficiencies, including interest, penalties, and reasonable attorney’s fees that Seller may incur or suffer which arise, result, or relate to any breach of, or failure by Buyer to perform, any of his representations, warranties, or covenants in this Sales Contract....”

Roemer contends section 26.01 of the contract was intended only to indemnify the buyer (McKinzie) against third party claims, and not as a prevailing party attorney fee provision between these two parties. We disagree.

B. General principles regarding attorney fees

As described in Carr Business Enterprises, Inc. v. City of Chowchilla (2008) 166 Cal.App.4th 14 (Carr): “ ‘Where a contract provides for attorney fees in an action to enforce the contract, the attorney fees provision is made applicable to the entire contract by operation of Civil Code section 1717. [Citations.]’ (Myers Building Industries, Ltd. v. Interface Technology, Inc. (1993) 13 Cal.App.4th 949, 968 (Myers).) Attorney fees authorized by contract are recoverable as costs pursuant to Code of Civil Procedure section 1033.5, subdivision (a)(10)(A). [Citation.] Under the American rule, attorney fees are not recoverable as costs unless expressly authorized by statute or contract. [Citation.]” (Carr, at p. 19.)

“[Civil Code] [s]ection 1717 provides that fees are recoverable ‘[i]n any action on a contract where the contract specifically provides that attorney’s fees and costs, which are incurred to enforce that contract, shall be awarded either to one of the parties or to the prevailing party, then the party who is determined to be the party prevailing on the contract, whether he or she is the party specified in the contract or not, shall be entitled to reasonable attorney’s fees....’ ” (Carr, supra, 166 Cal.App.4that p. 19, fn. 4.)

“Indemnity is a contract by which one engages to save another from a legal consequence of the conduct of one of the parties, or of some other person.” (Civ. Code, § 2772.) “ ‘An indemnity against claims, or demands, or liability, expressly, or in other equivalent terms, embraces the costs of defense against such claims, demands, or liability incurred in good faith, and in the exercise of a reasonable discretion....’ ([Civ. Code, ] § 2778, subd. 3.) Generally, the inclusion of attorney fees as an item of loss in a third party claim-indemnity provision does not constitute a provision for the award of attorney fees in an action on the contract which is required to trigger [Civil Code] section 1717. (Myers, supra, 13 Cal.App.4th at pp. 971-973; [citation].) ‘A clause which contains the words “indemnify” and “hold harmless” is an indemnity clause which generally obligates the indemnitor to reimburse the indemnitee for any damages the indemnitee becomes obligated to pay third persons. [Citation.] Indemnification agreements ordinarily relate to third party claims. [Citation.]’ (Myers, supra, 13 Cal.App.4th at p. 969.) An indemnity agreement is to be interpreted according to the language and contents of the contract, as well as the intention of the parties as indicated by the contract, using the same rules that govern the interpretation of other contracts. [Citations.]” (Carr, supra, 166 Cal.App.4th at p. 20.)

Baldwin Builders v. Coast Plastering Corp. (2005) 125 Cal.App.4th 1339 (Baldwin Builders) explained the reason for the exception to the operation of the Civil Code section 1717 rule of reciprocity where the recovery of attorney fees is authorized as an item of loss or expense in an indemnity agreement: “Because an indemnity agreement is intended by the parties to unilaterally benefit the indemnitee, holding it harmless against liabilities and expenses incurred in defending against third party tort claims (see Civ. Code, § 2772), application of reciprocity principles would defeat the very purpose of the agreement. (Myers, supra, 13 Cal.App.4th at p. 973.) In requiring reciprocity of only those provisions that authorize the recovery of attorney fees ‘in an[y] action on [the] contract, ’ section 1717[, subdivision] (a) expressly excludes indemnity provisions that allow the recovery of attorney fees as an element of loss within the scope of the indemnity. (Myers, at p. 971.)” (Baldwin Builders, at p. 1344.) However, even though the attorney fee provision is set forth in an indemnity agreement, where the relevant clause reflects that the parties intended also to provide for the recovery of attorney fees in an action on the contract, the prevailing party may recover such attorney fees. (See e.g., Baldwin Builders, supra, at pp. 1344-1346; Continental Heller Corp. v. Amtech Mechanical Services, Inc. (1997) 53 Cal.App.4th 500, 508-509 (Continental Heller Corp.).)

We are persuaded that the language of the sentence at issue in section 26.01 of the contract, when considered in the context of the entire Article 26, constitutes a prevailing party attorney fee provision, rather than a standard third-party claim indemnification clause.

In Carr, supra, 166 Cal.App.4th 14, the fee provision was broadly worded to provide that Carr “ ‘shall indemnify and hold harmless [Chowchilla]... from and against all claims, damages, losses and expenses including attorney fees arising out of the performance of the work described herein....’ ” (Id. at p. 19.) The Carr court observed that the language of the section, extending to claims “ ‘arising out of the performance of the work’ ” seemed to suggest it extended “beyond third party claims” to allow recovery of fees based on an action upon the contract. However, a review of the case law persuaded the Carr court that the indemnity clause at issue there was very similar to the clause in Myers, supra, 13 Cal.App.4th at page 964, and clauses in other cases that were found to be standard third-party claim indemnification clauses and not provisions allowing recovery of fees on an action upon the contract, despite its reference to performance of the contract work. (Carr, at pp. 20-21.)

“ ‘[Carr]shall indemnify and hold harmless [Chowchilla]... and its officers, officials, employees, agents of the above from and against all claims, damages, losses and expenses including attorney fees arising out of the performance of the work described herein, caused in whole or in part by any negligent act or omission of [Carr], any subcontractor... except where caused by the active negligence, sole negligence, or willful misconduct of [Chowchilla].” (Carr, supra, 166 Cal.App.4th at p. 19.)

The Carr court distinguished Baldwin Builders, supra, 125 Cal.App.4th 1339, and Continental Heller Corp., supra, 53 Cal.App.4th 500, in which attorney fee provisions set forth in the parties’ indemnity agreements were held to be reciprocal attorney fee clauses under Civil Code section 1717, subdivision (a), rather than an element of the loss within the scope of the indemnity agreements. (Carr, supra, 166 Cal.App.4th at pp. 22-23.)

In Baldwin Builders, the indemnity agreements between the developer and the subcontractors not only provided the developer with a right to indemnity for liabilities to third parties and expenses, including attorney fees, arising out of the subcontract work, but they also specified that the indemnitor subcontractors were required to pay Baldwin “ ‘all costs, including attorney’s fees, incurred in enforcing this indemnity agreement.’ (Italics added.)” (Baldwin Builders, supra, 125 Cal.App.4th at pp. 1342, 1345-1346; see Carr, supra, 166 Cal.App.4th at p. 22.) Baldwin Builders held that in contrast to the general provisions requiring the subcontractors to indemnify the developer “in the event of third party claims, the attorney fee clauses unambiguously contemplate an action between the parties to enforce the indemnity agreements... and thus [Civil Code] section 1717[, subdivision] (a) would appear to be applicable. [Citation.]” (Baldwin Builders, at p. 1345, citing Continental Heller Corp., supra, 53 Cal.App.4th at pp. 508-509.)

Baldwin Builders, supra, 125 Cal.App.4th 1339, both distinguished and disagreed with dicta in M. Perez Co., Inc. v. Base Camp Condominiums Assn. No. One (2003) 111 Cal.App.4th 456 (Perez), relied upon by Roemer here. Baldwin Builders stated:“[T]he Perez court observed that the general contractor was not asserting a direct right to recover attorney fees pursuant to the indemnity provision and theorized that this was because the general contractor ‘[n]o doubt recogniz[ed] that the indemnity provisions... [did] not constitute a prevailing-party-attorney-fee provision....’ (Perez, supra, 111 Cal.App.4th at p. 463, ... [citation].) Baldwin’s reliance on this language is misplaced, however, because the court’s passing comment is dicta and does not provide persuasive authority that [Civil Code] section 1717[, subdivision] (a) is inapplicable to the attorney fee clauses being challenged here. [Citations.] [¶] Even if the language in Perez was not dicta, however, we would reject Baldwin’s argument on its merits. We agree with the Perez court’s conclusion that the indemnity provision allowing the recovery of attorney fees incurred in defending against third party claims under the construction contract was not within the purview of [Civil Code] section 1717[, subdivision] (a); however, to the extent the opinion can be read as holding that the indemnity provision’s authorization of the recovery of attorney fees in a direct action to enforce that provision was also not subject to section 1717[, subdivision] (a), we simply cannot agree with such an interpretation of the contractual language and the statute. [Citation.]” (Baldwin Builders, at pp. 1345-1346, citing Continental Heller Corp., supra, 53 Cal.App.4th at pp. 508-509.)

Continental Heller Corp., supra, 53 Cal.App.4th 500, concluded that language similar to that in Myers, supra, 13 Cal.App.4th at page 964, obligating subcontractor Amtech to indemnify contractor Continental from all loss, damage, and so forth “ ‘including attorney’s fees’ which ‘arises out of or is in any way connected with the performance of work under this Subcontract, ’ ” would not support a reciprocal fee award under Civil Code section 1717. (Continental Heller Corp., at p. 508.) However, the court found dispositive that following the language containing the indemnity obligation in section 11, “[that section] goes on to state: ‘And the Subcontractor shall indemnify the Contractor, and save it harmless from any and all loss, damage, costs, expenses and attorney’s fees suffered or incurred on account of any breach of the aforesaid obligations and covenants, and any other provision or covenant of this Subcontract.’ ” (Continental Heller Corp., at pp. 508-509, italics added.) The court held: “It is clear this concluding paragraph is not referring to indemnity for attorney fees incurred in defending actions brought against Continental. That indemnity is covered in subparagraph (b) of the section. Rather, the quoted language is intended to entitle Continental to attorney fees in any action it brings against Amtech for breach of any provision of the contract including, but not limited to, breach of the indemnity provisions of subparagraph (b).” (Id. at p. 509, italics added.)

In this case, unlike the indemnity clause at issue in Carr, supra, 166 Cal.App.4th at page 19, which provided that the indemnitor was to indemnify and hold harmless the indemnitee “from and against all claims, damages, losses and expenses including attorney fees arising out of the performance of the work..., ’ the particular language at issue here in section 26.01 of Article 26 promises to hold “Buyer” harmless for any losses that “arise, result, or relate to any breach of, or failure by Seller to perform, any of [her] representations, warranties, or covenants in this Sales Contract....” (Italics added.) As the court below concluded, this provision clearly relates to damages from the Seller’s breach of the contract. As in those provisions found to constitute reciprocal attorney fees clauses in Baldwin Builders, supra, 125 Cal.App.4th1339 and Continental Heller Corp., supra, 53 Cal.App.4th 500, “the quoted language is intended to entitle [McKinzie] to attorney fees in any action it brings against [Roemer] for breach of any provision of the contract....” (Continental Heller Corp., at p. 509.)

Further support for this conclusion is found in the contrast between this initial sentence and the sentences that follow, expressly providing indemnification for a wide variety of identified third party claims, including liabilities to governmental and taxing authorities, victims of professional negligence, and creditors. These differences further highlight the absence of such third party references in the first sentence.

Moreover, any doubt that the sentence at issue in section 26.01 of Article 26 of the contract was intended by the contracting parties to authorize the recovery of attorney fees by the prevailing party in a breach of contract action between them is put to rest by the existence of the first sentence of section 26.02, the mirror to 26.01, purporting to indemnify “Seller” (Roemer) for losses incurred (including attorney fees) for any breach of the sales contract by “Buyer” (McKinzie). This mirror provision renders this agreement unlike any of those that have been found to constitute third party claim indemnity provisions rather than reciprocal attorney fees provisions allowing fees to the prevailing parties. Standard indemnity provisions do not anticipate that the losing party will indemnify the winning party regardless of the identity of either. Such reciprocal fee provisions are fundamentally inconsistent with indemnity, which is intended to unilaterallybenefit the indemnitee. The cases recognize that “application of reciprocity principles would defeat the very purpose of the [indemnity] agreement.” (Baldwin Builders, supra, 125 Cal.App.4th at p. 1344; see Myers, supra, 13 Cal.App.4th at p. 973.)

We do not mean to suggest that the indemnity provisions following the first sentences of section 26.01 and 26.02 of the sales contract are fundamentally inconsistent with indemnity. Although they mirror each other in most respects, they set forth a time line-the closing date-before which Roemer shall indemnify McKinzie for third party claims, and after which McKinzie shall indemnify Roemer for third party claims.

II. The Amount of Attorney Fees

Roemer contends that the court abused its discretion in awarding fees incurred for claims McKinzie had voluntarily dismissed and in basing its award on billing rates unsupported by the evidence. We disagree.

‘The reasonableness of attorney fees is within the discretion of the trial court, to be determined from a consideration of such factors as the nature of the litigation, the complexity of the issues, the experience and expertise of counsel, and the amount of time involved. [Citation.]’ (Wilkerson v. Sullivan (2002) 99 Cal.App.4th 443, 448; accord, PLCM Group, Inc. v. Drexler (2000) 22 Cal.4th 1084, 1096.) The trial court possesses personal expertise in the value of the legal services rendered in the case before it. (PLCM Group, Inc., at p. 1096.) On appeal, a fee award is reviewed for abuse of discretion. (Paulus v. Bob Lynch Ford, Inc. (2006) 139 Cal.App.4th 659, 686.)” (Russell v. Foglio (2008) 160 Cal.App.4th 653, 661.)

As we recently observed in Chacon v. Litke (2010) 181 Cal.App.4th 1234, quoting our California Supreme Court in Ketchum v. Moses (2001) 24 Cal.4th 1122: “ ‘The “ ‘experienced trial judge is the best judge of the value of professional services rendered in his court, and while his judgment is of course subject to review, it will not be disturbed unless the appellate court is convinced that it is clearly wrong.’ ” [Citation.]’ (Ketchum v. Moses, at p. 1132...)” (Chacon v. Litke, at p. 1259.) Roemer has failed to demonstrate the court below was “clearly wrong” in its estimation of the value of the services rendered McKinzie in the litigation below.

Whether or not the fraud claims were the “primary focus” of the litigation prior to dismissal of those claims before trial as Roemer asserts, the court credited counsel for McKinzie’s statement that they had, where possible, eliminated claims solely based on fraud. It specifically found that the work for which recovery was sought “relates either directly to litigation of the contract claims or is so intertwined with the litigation of those claims that segregation would be impracticable.” Substantial evidence supports the court’s findings.

Although Roemer challenges the credibility of opposing counsel David Lee, and asserts there was no “competent” evidence of comparable market rates for attorney fees introduced, Lee’s deposition testimony clarifies that the rates submitted for the work performed were based upon the law firm’s annual fee schedule. First, credibility assessments are for the trial court. (Eisenberg et al, Civil Appeals and Writs (The Rutter Group 2009) ¶ 8:41, p. 8-19, and cases there cited.) Second, counsel’s own billing rates carry a presumption of reasonableness. (Russell v. Foglio, supra, 160 Cal.App.4th at p. 661.) Third, the trial court relied upon its own knowledge and experience of comparable billing rates, as was appropriate under Ketchum v. Moses, supra, 24Cal.4th at p. 1132. (See also Russell v. Foglio, at p. 661.)

In contending the fee award was not reasonable, Roemer ignores the trial court’s reduction of the attorney fee award by 15 percent to account for: (1) inefficient or duplicative work, including having two attorneys appear throughout trial; (2) block billing entries and/or descriptions that made it difficult to determine how much time was spent on each task and whether any such time was spent solely on the fraud claims; and (3) a reasonable deduction for entries (such as drafting discovery requests) that included requests going to fraud as well as breach of contract claims. Roemer has failed to show that this reduction was inadequate or that the resulting fee award was unreasonable, particularly in light of the court’s express finding that further reductions were not warranted due to Roemer’s “decision to litigate this case heavily at each turn....” The court also rejected Roemer’s claim that the amount of attorney fees was disproportionate to the amount awarded at trial, given that Roemer never conceded issues of liability under the contract, had litigated the case tenaciously at every turn, and had forced McKinzie to expend substantial resources in establishing Roemer’s liability on summary adjudication and at trial. (See City of Riverside v. Rivera (1986) 477 U.S. 561, 580, fn. 11 [a party cannot tenaciously litigate and then be heard to complain about the time necessarily spent by the plaintiff in response]; see also Vo v. Los Virgenes Municipal Water Dist. (2000) 79 Cal.App.4th 440, 447-448 [upholding a $470,000 fee award that was more than 10 times damages].)

The trial court did not abuse its discretion in its award of attorney fees and costs to McKinzie.

DISPOSITION

The attorney fees award is affirmed. McKinzie shall recover his costs on this appeal.

We concur: Haerle, J.Richman, J.

“Article 26. Liability: Indemnity

“26.01 Seller shall indemnify, defend, and hold Buyer harmless against and in respect of any and all claims, demands, losses, costs, expenses, obligations, liabilities, damages, recoveries, and deficiencies, including interest, penalties, and reasonable attorney’s fees that Buyer may incur or suffer which arise, result, or relate to any breach of, or failure by Seller to perform, any of [her] representations, warranties, or covenants in this Sales Contract. In addition thereto, Seller shall indemnify, defend, and hold Buyer harmless against and in respect to any and all claims, demands, losses, costs, expenses, obligations, liabilities, damages, recoveries, and deficiencies, including interest, penalties, and reasonable attorney’s fees, and including, but not limited to, any and all claims by the Internal Revenue Service, Franchise Tax Board, State Board of Equalization or Employment Development Department, and any lost [sic] or damage for bodily injury, including death, property damage, and/or economic loss which may arise from, result from, or in any form or any way relate to Seller’s operation of her Practice and her practice of dentistry prior to the Closing Date and any retreatment subsequent to the Closing Date, including, but not limited, any act of negligence of Seller, Seller’s agents, employees, and independent contractors. Seller shall indemnify and hold Buyer harmless of and from any and all existing liabilities, claims, causes of action, or the like arising from acts or omissions prior to the Closing Date, which may be asserted by creditors of Seller against Buyer. Buyer shall not be responsible for any business, occupation, withholding, or similar tax or taxes of any kind relating to any period before the Closing date; and “26.02 Buyer shall indemnify, defend, and hold Seller harmless against and in respect to any and all claims, demands, losses, costs, expenses, obligations, liabilities, damages, recoveries, and deficiencies, including interest, penalties, and reasonable attorney’s fees that Seller may incur or suffer which arise, result, or relate to any breach of, or failure by Buyer to perform, any of his representations, warranties, or covenants in this Sales Contract. In addition thereto, Buyer shall indemnify, defend, and hold Seller harmless against and in respect to any and all claims, demands, losses, costs, expenses, obligations, liabilities, damages, recoveries, and deficiencies, including interest, penalties, and reasonable attorney’s fees, and including, but not limited to, any and all claims by the Internal Revenue Service, Franchise Tax Board, State Board of Equalization, and any loss or damage for bodily injury, including death, property damage, and/or economic loss which may arise from, result from, or in any form or any way relate to Buyer’s operation of Seller’s Practice, his use of Seller’s name, and his practice of general dentistry after the Closing Date, including but not limited to, any act of negligence of Buyer, Buyer’s agents, employees, and independent contractors, but excepting any act or omission of negligence of Seller while working as Buyer’s employee or independent contractor after the Closing Date. Buyer shall indemnify and hold Seller harmless from any and all liabilities, claims, causes of action, or the like arising from acts or omissions after the Closing Date which may be asserted by creditors of Buyer against Seller. Seller shall not be responsible for any business, occupation, withholding, or similar tax or taxes of any kind relating to any period after the Closing date.” (Italics added.)


Summaries of

McKinzie v. Roemer

California Court of Appeals, First District, Second Division
Jul 1, 2010
No. A124787 (Cal. Ct. App. Jul. 1, 2010)
Case details for

McKinzie v. Roemer

Case Details

Full title:SCOTT MCKINZIE, Plaintiff and Respondent, v. PAULA ROEMER, Defendant and…

Court:California Court of Appeals, First District, Second Division

Date published: Jul 1, 2010

Citations

No. A124787 (Cal. Ct. App. Jul. 1, 2010)