Opinion
NOT TO BE PUBLISHED
APPEAL from a judgment and order of the Superior Court of Los Angeles County Super. Ct. No. BC395298, Michael L. Stern, Judge.
Veatch Carlson and Cyril Czajkowskyj for Defendants and Appellants.
Law Office of Louis P. Dell and Louis P. Dell for Plaintiffs and Respondents.
CROSKEY, J.
Richard Sapir and Farid Sapir appeal a postjudgment order awarding $212,685 in attorney fees to counsel for Jennifer Robertson, Tiffany Albert, and Rae Nicole Zamora after a jury trial. Richard Sapir and Farid Sapir contend there is no contractual basis for a fee award because no signed lease was admitted in evidence at trial, and any contractual right to recover attorney fees does not encompass fees incurred to prosecute tort claims. They also challenge the fee award on other grounds.
Richard Sapir and Farid Sapir also appeal the judgment but fail to challenge the judgment in their appellants’ opening brief, and therefore abandon their appeal from the judgment.
We conclude that the evidence supports the trial court’s implied finding that Richard Sapir was a party to a written lease with an attorney fee provision, but Farid Sapir was not a party to the lease and is not liable for attorney fees. We also conclude that the failure to apportion fees between the claims against Brian Sapir and those against the other defendants was error. We therefore will reverse the order with directions.
FACTUAL AND PROCEDURAL BACKGROUND
1. Factual Background
Robertson, Albert, and Zamora were tenants sharing the second floor of a duplex. Caroline Dumont was a tenant on the first floor. Unlike the second floor, the first floor was a boarding house where tenants leased individual bedrooms and shared a living room. Richard Sapir owned the property, but was not personally involved in leasing. His mother, Peggy Sapir, managed the first floor, and his father, Farid Sapir, managed the second floor. A leasing agent, Paul Gilbert, also was involved in leasing the property for a time.
Several items were in need of repair at the time that Robertson, Albert, and Zamora signed the lease. Some of those items still were not repaired at the time that they moved in. The oven did not work. Some of the wooden window casements were deteriorated, allowing the wind to blow through, and some the windows did not close securely. There was no functioning heater in the unit for six months after they moved in. The wood on the back staircase was rotted. Some of the wood was replaced and the staircase repainted several months after they moved in, but the staircase became slippery causing Robertson to fall and injure her back.
Brian Sapir, Richard Sapir’s brother, moved into a bedroom on the first floor sometime after the other tenants had moved in. The living conditions on the property soon deteriorated. He spent much of his time in the shared living room smoking marijuana while watching television. He played loud music. He would yell while beating a large punching bag, and would leave it in various locations on the property. He often called Dumont, an immigrant from France, a “French bitch.”
Dumont saw Brian Sapir place a brick smeared with feces in the garage next to Robertson’s car on the morning of September 23, 2007. On the same day, Zamora’s boyfriend, Scott Yoshimura, saw him letting the air out of Robertson’s and Zamora’s bicycle tires and kicking the bicycles to the floor of the garage. Yoshimura later saw Brian Sapir tampering with Robertson’s car and then inspected the car and found the word “shit” written in feces on the windshield. He approached Brian Sapir, who was sitting on the couch, about this. They exchanged words, and Brian Sapir said, “Do you want me to get my gun?” Brian Sapir then chased Yoshimura to the street and halfway down the block. Brian Sapir returned to the property, chased Robertson and Zamora upstairs, and banged on their door.
Yoshimura later stood in a driveway across the street and photographed Brian Sapir in a car in the driveway on the property. Brian Sapir suddenly drove across the street into the neighbor’s driveway toward Yoshimura, who quickly moved out of the way. Brian Sapir argued with the neighbor and then returned to chasing Yoshimura before leaving in his car. The police and paramedics responded and spoke with the participants in the days’ events. Robertson, Albert, Zamora, and Dumont promptly moved out.
2. Trial Court Proceedings
Robertson, Albert, Zamora, Dumont, Yoshimura, and Yvette Tung filed a complaint against Richard Sapir, Farid Sapir, Peggy Sapir, Brian Sapir, and others in July 2008. The plaintiffs filed a first amended complaint against the same defendants in October 2008, alleging counts for (1) breach of the implied warranty of habitability; (2) tortious failure to provide habitable premises; (3) breach of the implied covenant of quiet enjoyment; (4) negligence; (5) intentional infliction of emotional distress; (6) assault; (7) battery; (8) excessive rent in violation of the rent stabilization ordinance; (9) failure to return a security deposit; (10) breach of fiduciary duty; and (11) fraud.
Tung apparently settled with the defendants before trial and is not a party to this appeal.
The defendants served statutory offers to compromise (Code Civ. Proc., § 998) in August 2009, offering to allow judgments to be taken against them in favor of Robertson, Albert, and Zamora in the amounts of $20,000, $5,000, and $20,000, respectively, inclusive of attorney fees and costs. The plaintiffs refused the offers.
A jury trial commenced in December 2009. Robertson testified that she, Albert, and Zamora signed the lease admitted in evidence as exhibit 1, and that she saw Farid Sapir sign the lease as well. Farid Sapir answered “yes” to the question “The lease was entered into, correct?” but was not asked whether he signed it himself. He testified that “Paul Lindberg” (presumably a mistaken reference to the leasing agent, Paul Gilbert) informed him that the lease was entered into and “signed it right on the premises.” Exhibit 1 bears the signatures and initials of Robertson, Albert, and Zamora, but bears no signature or initials by Richard Sapir or Farid Sapir.
The jury returned a verdict finding that Richard Sapir and Farid Sapir breached the implied warranty of habitability and were negligent in the repair or maintenance of the property; that Richard Sapir, Farid Sapir, and Peggy Sapir breached the implied covenant of quiet enjoyment; that Brian Sapir assaulted Robertson, Zamora, and Yoshimura, and battered Dumont; and that Brian Sapir intentionally inflicted emotional distress on one or more of the plaintiffs. The jury found for the defendants on the counts for excessive rent and failure to return a security deposit. The jury awarded damages against Richard Sapir, Farid Sapir, and Peggy Sapir in favor of Robertson ($5,400), Albert ($3,900), Zamora ($5,400), and Dumont ($5,100). The jury also awarded damages against Brian Sapir in favor of Robertson ($8,000), Zamora ($5,000), Yoshimura ($5,000), and Dumont ($8,000). In addition, the jury found that Brian Sapir had acted with malice or oppression, but the trial court granted a directed verdict in favor of Brian Sapir as to punitive damages. The court entered a judgment on December 17, 2009, awarding damages in accordance with the verdict.
Although the verdict is denominated “special verdict, ” it is actually a series of general verdicts. (Boeken v. Philip Morris Inc. (2005) 127 Cal.App.4th 1640, 1668; Shaw v. Hughes Aircraft Co. (2000) 83 Cal.App.4th 1336, 1347, fn. 7.)
Robertson, Albert, and Zamora moved for an award of $212,685 in attorney fees against Richard Sapir and Farid Sapir based on an attorney fee provision in the lease and under Civil Code section 1942.4. They sought fees incurred by all of the plaintiffs in connection with claims by and against all parties with no apportionment. The defendants opposed the motion, challenging both the right to recover attorney fees and the amount requested. The defendants argued, among other things, that the lease admitted in evidence at trial did not bear their signatures, so the attorney fee provision in the lease was not binding on them. In reply, the plaintiffs presented what they referred to as trial exhibit 2, which appears to bear a signature and initials by Richard Sapir. Trial exhibit 2 is identical to exhibit 1 except that the former is fully executed and initialed, included interlineations in some provisions, and includes information at the top of each page indicating that the document was faxed from the leasing agent.
The trial court granted the motion in a minute order filed on February 26, 2010, awarding a total of $212,685 in attorney fees. The court entered an amended judgment on March 16, 2010, including the attorney fee award and awarding $12,556.74 in other costs. The court denied the defendants’ motion for reconsideration of the fee award.
Richard Sapir and Farid Sapir timely appealed the judgment and the order awarding attorney fees.
CONTENTIONS
Richard Sapir and Farid Sapir contend (1) the plaintiffs are not entitled to fees under the lease because the only lease that was admitted in evidence at trial was not signed by Richard Sapir or Farid Sapir; (2) any contractual right to fees cannot apply to Farid Sarid because he was not the property owner; (3) any contractual right to fees does not encompass fees incurred to prosecute tort claims; (4) the plaintiffs are not entitled to attorney fees under Civil Code section 1942.4; (5) the fee award is excessive; and (6) the trial court erroneously failed to apportion fees.
DISCUSSION
1. Standard of Review
An attorney fee award will be disturbed on appeal only if the trial court committed a legal error, made a finding that is not supported by the evidence, or abused its discretion. (Yield Dynamics, Inc. v. Tea Systems Corp. (2007) 154 Cal.App.4th 547, 577.) The scope of an attorney fee provision is a question of contract interpretation. We interpret a contract de novo if the interpretation does not turn on the credibility of extrinsic evidence, as here. (City of Manhattan Beach v. Superior Court (1996) 13 Cal.4th 232, 238; Kalai v. Gray (2003) 109 Cal.App.4th 768, 777.)
We infer all factual findings necessary to support the award if the record is silent and review any factual findings made in connection with the award under the substantial evidence standard. (Frei v. Davey (2004) 124 Cal.App.4th 1506, 1512; Beach Colony II v. California Coastal Com. (1985) 166 Cal.App.3d 106, 110.)
2. The Trial Court Properly Awarded Fees Against Richard Sapir Pursuant to the Lease but the Award Against Farid Sapir Was Error
Attorney fees as costs pursuant to a contract need not be demanded in the complaint or proved at trial. Such fees instead can be sought in a posttrial motion. (Chinn v. KMR Property Management (2008) 166 Cal.App.4th 175, 194; Allstate Ins. Co. v. Loo (1996) 46 Cal.App.4th 1794, 1797-1798.) Accordingly, the contract need not be admitted in evidence at trial to support an attorney fee award.
Robertson testified at trial that Farid Sapir signed the lease in her presence. She testified that Gilbert had introduced “Fred Sapir” as the owner. Richard Sapir acknowledged that he had authorized his father to lease and manage the property. A contract signed by an agent who has actual authority to act on behalf of the principal is binding on the principal. (Civ. Code, §§ 2316, 2330, 2337.) “An instrument within the scope of his authority by which an agent intends to bind his principal, does bind him if such intent is plainly inferable from the instrument itself.” (Id., p. 2337.) We conclude that substantial evidence supports the implied finding by the trial court that Farid Sapir, as agent, signed the lease on behalf of Richard Sapir. Richard Sapir as principal therefore was a party to and was bound by the lease, including the attorney fee provision.
An agent does not become a party to a contact and assumes no contractual obligation merely by entering into a contract in the name of his or her principal, unless the agent had no good faith belief that he or she had authority to enter into the contract. (Civ. Code, § 2343; see 3 Witkin, Summary of Cal. Law (10th ed. 2005) Agency and Employment, § 197, pp. 248-249.) Civil Code section 2343 states:
“One who assumes to act as an agent is responsible to third persons as a principal for his acts in the course of his agency, in any of the following cases, and in no others:
“1. When, with his consent, credit is given to him personally in a transaction;
“2. When he enters into a written contract in the name of his principal, without believing, in good faith, that he has authority to do so; or,
“3. When his acts are wrongful in their nature.”
There is no evidence that Farid Sapir lacked a good faith belief in his authority to enter into the contract, and the undisputed evidence is that he had such authority.
The third provision in the statute merely codifies the common law rule that an agent is liable for his or her own torts. (Mears v. Crocker First Nat. Bank (1950) 97 Cal.App.2d 482, 491; see Shafer v. Berger, Kahn, Shafton, Moss, Figler, Simon & Gladstone (2003) 107 Cal.App.4th 54, 68-69; PMC, Inc. v. Kadisha (2000) 78 Cal.App.4th 1368, 1381.) An act is “wrongful” within the meaning of this provision only if the act is tortious. (Mears, supra, 97 Cal.App.2d at p. 491.) An agent’s “wrongful” act can result in the agent’s tort liability under this provision, but cannot give rise to a contractual obligation. (Ruiz v. Herman Weissker, Inc. (2005) 130 Cal.App.4th 52, 65.) The third provision therefore cannot support Farid Sapir’s liability for attorney fees under the lease. We conclude that there is no legal basis for an award of attorney fees against Farid Sapir.
There also is no basis for an attorney fee award under Civil Code section 1942.4, and the trial court did not award fees under that statute. The plaintiffs neither alleged a violation of section 1942.4 nor proved that the statutory conditions were present.
3. The Attorney Fee Provision Encompasses Contract and Tort Claims
A contract can provide for the recovery of fees incurred on both contract and tort causes of action, or can be more narrowly drawn. (Santisas v. Goodin (1998) 17 Cal.4th 599, 608.) The attorney fee provision in the lease states:
“In any action or proceeding arising out of this Agreement, the prevailing party between Landlord and Tenant [shall] be entitled to reasonable attorney fees and costs, except as provided in paragraph 38A.” (Italics added.)
Paragraph 38A of the lease precludes an award of attorney fees for any party that commences litigation without first attempting to resolve the dispute through mediation, and is not at issue here.
Our goal in interpreting a contract is to give effect to the mutual intention of the contracting parties at the time the contract was formed. (Civ. Code, § 1636.) We ascertain that intention solely from the written contract if possible, but also consider the circumstances under which the contract was made and the matter to which it relates. (Id., §§ 1639, 1647.) We consider the contract as a whole and interpret its language in context so as to give effect to each provision, rather than interpret contractual language in isolation. (Id., § 1641.) We interpret words in accordance with their ordinary and popular sense, unless the words are used in a technical sense or a special meaning is given to them by usage. (Id., § 1644.) If contractual language is clear and explicit and does not involve an absurdity, the plain meaning governs. (Id., § 1638.)
An action or proceeding “arising out of” an agreement, in the ordinary meaning of those words, is not limited to an action on the contract, but also encompasses tort causes of action arising from the transaction or relationship that is the subject of the agreement. (Santisas v. Goodin, supra, 17 Cal.4th at p. 608; Lerner v. Ward (1993) 13 Cal.App.4th 155, 160; Xuereb v. Marcus & Millichap, Inc. (1992) 3 Cal.App.4th 1338, 1344.) The language “arising out of” is broader than other language that the parties could have used to limit the scope of the fee provision to actions on the contract, if they so intended. (See, e.g., Exxess Electronixx v. Heger Realty Corp. (1998) 64 Cal.App.4th 698, 708-709 [“to enforce the terms hereof or declare rights hereunder”]; Loube v. Loube (1998) 64 Cal.App.4th 421, 429-430 [“to enforce the terms of this Agreement”].) We conclude that the fee provision here encompasses both contract and tort causes of action.
Richard Sapir contends the attorney fee provision in the lease does not encompass fees incurred to prosecute tort claims. He does not discuss the particular tort claims involved in this action or argue that those claims do not arise from the lease. We therefore limit our discussion to whether the fee provision in the lease encompasses fees incurred to prosecute tort claims, and conclude that it does.
4. The Failure to Apportion Fees Was Error
Richard Sapir challenges the attorney fee award on several grounds, including the failure to apportion fees between the counts against him and those against Brian Sapir and the failure to apportion fees between the claims by Robertson, Albert, and Zamora and those by other plaintiffs.
Attorney fees that are solely attributable to claims or parties as to which there is no right to recover fees may not be awarded. In those circumstances, the fees must be apportioned between the claims or parties as to which fees are recoverable and the claims or parties as to which fees are not recoverable. But apportionment is not required if the fees were incurred for representation on an issue common to both claims or parties as to which fees are recoverable and those as to which fees are not recoverable, or the claims are so intertwined that it would be impracticable to segregate the attorney’s time. (Reynolds Metals Co. v. Alperson (1979) 25 Cal.3d 124, 129-130; Bell v. Vista Unified School Dist. (2000) 82 Cal.App.4th 672, 686-687.) Apportionment of fees is committed to the trial court’s discretion. (Bell, supra, at p. 687.)
A large part of this litigation involved pretrial discovery and trial testimony relating to the counts against Brian Sapir for assault, battery, and intentional infliction of emotional distress. Those counts were factually and legally distinct from the counts against Richard Sapir relating to the condition of the premises (i.e., habitability, quiet enjoyment, and negligence), excessive rent, and failure to return a security deposit. The plaintiffs made no meaningful effort to show that the claims against Brian Sapir were inextricably intertwined with the claims against Richard Sapir or that they involved substantial common issues. Our review of the record compels the conclusion that apportionment is required between recoverable fees relating to the claims against Richard Sapir and nonrecoverable fees solely attributable to the claims against Brian Sapir. The trial court on remand must apportion fees and limit any fee award accordingly.
We need not separately decide whether the fee award includes amounts attributable solely to other plaintiffs. The same principal applies. The trial court on remand must limit the fee award to amounts incurred in connection with the claims by Robertson, Albert, and Zamora. Fees incurred in connection with the claims by other plaintiffs are recoverable only to the extent that such claims were inextricably intertwined with the claims by Robertson, Albert, and Zamora or involved issues in common with those claims. In light of our conclusion and the need to redetermine the fee award, we need not decide whether the fee award is excessive for other reasons.
5. Other Considerations on Remand
Richard Sapir contends the plaintiffs are not entitled to recover fees and other costs incurred after they rejected his statutory offer to compromise. A plaintiff is precluded from recovering costs incurred after the date of an offer to compromise if the plaintiff rejects the offer and fails to obtain a more favorable judgment. (Code Civ. Proc., § 998, subd. (c)(1).) In determining whether the judgment is more favorable to the plaintiff than an offer to compromise that includes costs, costs awarded in the judgment are included in the amount of the judgment if they were incurred before the date of the offer and are excluded from the amount of the judgment if they were incurred after the date of the offer. (Id., subd. (c)(2)(A); Heritage Engineering Construction, Inc. v. City of Industry (1998) 65 Cal.App.4th 1435, 1441.)
The plaintiffs presented to the trial court calculations showing as to each plaintiff that the amount awarded in the judgment, including preoffer attorney fees and costs, exceeded the amount of the respective offer to compromise. Richard Sapir does not challenge those calculations. He argues instead that any plaintiff who, as a result of this appeal, fails to obtain a more favorable result than the amount of the offer to compromise will not be entitled to recover fees and other costs incurred after the offer was rejected. We agree. The trial court on remand must determine anew whether each plaintiff obtained a more favorable judgment than the offer to compromise and whether the amount of costs, including attorney fees, to be awarded to each plaintiff is limited by Code of Civil Procedure section 998, subdivision (c)(1).
Finally, the award to the plaintiffs’ attorneys rather than to the plaintiffs as the contracting parties is unusual, and there is no explanation either in the motion for attorney fees or the trial court’s order as to the reasons for such an award. Absent clear authority to award fees to the attorneys in these circumstances, we believe that the trial court should clearly articulate the legal and factual justification for such an award on remand if fees are awarded to the attorneys on remand.
The plaintiffs’ attorneys were not parties to the lease contract on which the attorney fee award is based. While it is true that attorney fees may be awarded directly to the plaintiffs’ attorney in some circumstances, rather than to the plaintiffs themselves (see Serrano v. Priest (1977) 20 Cal.3d 25, 47, fn. 21 [fees awarded under the “private attorney general” theory]; Folsom v. Butte County Assn. of Governments (1982) 32 Cal.3d 668, 682, fn. 26 [same]; see also Flannery v. Prentice (2001) 26 Cal.4th 572, 577 [holding that fees awarded under Government Code section 12965 belong to the attorney rather than the plaintiff, absent a contrary agreement]), we are aware of no authority for such an award made pursuant to Civil Code section 1717.
DISPOSITION
The appeal from the judgment is dismissed. The order awarding attorney fees is reversed with directions to the trial court to (1) deny the motion as against Farid Sapir, (2) apportion the fee award against Richard Sapir in accordance with the views expressed in this opinion, including the justification for any award of fees directly to the plaintiffs’ attorneys, and (3) determine the effect of Code of Civil Procedure section 998, subdivision (c)(1) on the award of fees and other costs. Each side must bear its own costs on appeal.
We Concur: KLEIN, P. J.ALDRICH, J.