Opinion
E052352 E053582
10-30-2012
JOHN M. SICILIANO et al., Plaintiffs and Appellants, v. ROUPWATIE SINGH, Defendant and Respondent. JOHN M. SICILIANO, Plaintiff and Respondent; JOAN E. LOUW, Plaintiff and Appellant, v. ROUPWATIE SINGH, Defendant and Appellant.
Law Offices Beck and Greer and Richard B. Beck for Plaintiffs and Appellants John M. Siciliano and Joan E. Louw. Law Offices John M. Siciliano and John M. Siciliano for Plaintiff and Respondent John M. Siciliano. Kostic Law Firm and Ljubisa Kostic for Defendant and Respondent and Defendant and Appellant Roupwatie Singh.
NOT TO BE PUBLISHED IN OFFICIAL REPORTS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 This opinion has not been certified for publication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. RIC455460)
ORDER MODIFYING OPINION
AND DENYING PETITION FOR
REHEARING [NO CHANGE IN
JUDGMENT]
THE COURT:
The petition for rehearing filed by appellant John M. Siciliano is denied. It is ordered that the opinion filed herein on October 5, 2012, be modified as follows:
On page 27, beginning on the ninth line, strike the following two sentences: "We note, moreover, that the parties' stipulation to set aside the funds pending resolution of the case specifically called for interest on the account to be awarded to Roupwatie. We find that contract dispositive."
Except for the above modification, the opinion remains unchanged. There is no change in the judgment.
NOT TO BE PUBLISHED IN OFFICIAL REPORTS
HOLLENHORST
Acting P. J.
We concur: KING
J.
CODRINGTON
J.
NOT TO BE PUBLISHED IN OFFICIAL REPORTS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 This opinion has not been certified for publication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.
JOHN M. SICILIANO et al., Plaintiffs and Appellants,
v.
ROUPWATIE SINGH, Defendant and Respondent.
JOHN M. SICILIANO, Plaintiff and Respondent;
JOAN E. LOUW, Plaintiff and Appellant,
v.
ROUPWATIE SINGH, Defendant and Appellant.
E052352
(Super.Ct.No. RIC455460)
E053582
(Super.Ct.No. RIC455460)
OPINION
APPEAL from the Superior Court of Riverside County. Lillian Y. Lim, Judge. (Retired judge of the San Diego Super. Ct. assigned by the Chief Justice pursuant to art. VI, § 6 of the Cal. Const.) Affirmed in part; reversed in part.
Law Offices Beck and Greer and Richard B. Beck for Plaintiffs and Appellants John M. Siciliano and Joan E. Louw.
Law Offices John M. Siciliano and John M. Siciliano for Plaintiff and Respondent John M. Siciliano.
Kostic Law Firm and Ljubisa Kostic for Defendant and Respondent and Defendant and Appellant Roupwatie Singh.
I. INTRODUCTION
Plaintiffs John M. Siciliano and Joan E. Louw appeal from judgment in their quantum meruit action for attorney fees against defendant Roupwatie Singh. Plaintiffs contend the trial court erred by (1) failing to adhere to law of the case and by precluding Siciliano from admitting his terminated contingency fee agreement as evidence of the reasonable value of his services, thereby limiting him to an hourly fee; (2) issuing erroneous and confusing jury instructions as to Louw that allowed the jury to measure the value of her services by an hourly rate instead of by a pro rata share formula; (3) admitting evidence of (a) plaintiffs' hourly rates; (b) work performed by subsequent attorneys after plaintiffs' discharge; (c) prelitigation offers to settle; and (d) the death of Roupwatie's husband, Chanda Singh; and (4) denying their requests for prejudgment interest and Louw's request for attorney fees. Roupwatie has appealed from the denial of her motion for attorney fees under Civil Code section 1717.
Chanda died of unrelated causes during the pendency of this action.
We refer to the Singhs by their first names for clarity and convenience, and not intending any disrespect.
We find no error in the trial court's rulings as to Siciliano's claims, and we will affirm the judgment as to him. We conclude the trial court erred in denying Louw's request for costs under Code of Civil Procedure section 1032; however, the trial court did not err in concluding she was not entitled to attorney fees as an element of costs.
II. FACTS AND PROCEDURAL BACKGROUND
In October 2003, Roupwatie suffered serious injuries in an automobile collision. In November 2003, Chanda retained Louw to represent Roupwatie in bringing a personal injury action. She and Louw entered into a written contingency fee contract providing for a fee of 33 1/3 percent on any recovery Roupwatie obtained. The contract included a provision for attorney fees to the prevailing party in the event of litigation with respect to the amount of or entitlement to attorney fees under the contract.
Before retaining Louw, Roupwatie had retained and then terminated representation by the law firm of Jacoby and Myers, which is not a party to this appeal.
In June 2004, Louw received an offer from the insurance carrier for the other automobile involved in the collision to settle the matter for $100,000. Because, among other reasons, the offer required a release from liability for all other potential defendants, Louw advised the Singhs that the offer was inadequate and recommended against accepting it. Later that month, Roupwatie discharged Louw without accepting the offer. Louw forwarded a notice of lien to Roupwatie. During the course of her representation, Louw spent 68 billable hours on the matter.
After discharging Louw, Roupwatie retained Siciliano to represent her in the personal injury matter. She and Siciliano entered into a written contingency fee contract calling for a 40 percent fee on any recovery Roupwatie obtained if Siciliano filed suit on her behalf. In June 2004, Siciliano filed a suit on her behalf (the underlying action).
In June 2005, Siciliano forwarded a Code of Civil Procedure section 998 offer for settlement in the amount of $1 million to a named defendant in the underlying action. That offer was separate from the $100,000 offer to settle that Louw had previously received. The attorney representing that defendant in the underlying action testified she had responded that the 30-day deadline to respond to the offer was unreasonable and that extensive discovery had to be done before she could have the insurance carrier evaluate liability and damages. The offer was never accepted.
Meanwhile, in July 2005, Roupwatie discharged Siciliano and instructed him to withdraw all outstanding offers to settle. Siciliano did so and forwarded notices of lien to all parties and attorneys in the underlying action. Siciliano testified that the costs he incurred during his representation of Roupwatie totaled $1,919, and during the time he represented Roupwatie, his hourly rate had ranged from $200 to $275 per hour.
After discharging Siciliano, Roupwatie retained Ray Artiano and the law firm of Stutz, Artiano, Shinoff & Holtz (the Stutz firm) under a written 33 1/3 percent contingency fee agreement to represent her in the underlying action. Artiano and the Stutz firm filed suit on behalf of Chanda for loss of consortium. Thereafter, Artiano and the Stutz firm had Roupwatie examined by an orthopedic surgeon, retained an economist, took various depositions, amended Roupwatie's claims to include theories of joint enterprise and joint/borrowed employee so as to make various corporate defendants in the underlying action liable for the negligence of the driver, and participated in two mediations. In May 2006, Roupwatie obtained a settlement in the underlying action for $825,000. Chanda received a settlement of $275,000.
Louw requested attorney fees from Roupwatie in the amount of $33,333.33 (33 1/3 percent of the $100,000 settlement offer Louw had received), and Siciliano requested fees from Roupwatie in the amount of $290,000. Roupwatie refused to pay those fees, and a portion of her recovery was deposited in a blocked account.
In August 2006, Siciliano and Louw filed suit against Roupwatie for quantum meruit. Siciliano also filed suit against Artiano, the Stutz firm, Chanda, and Robert Geile (the attorney who had referred the Singhs to Artiano and the Stutz firm) for intentional interference with a contract and intentional interference with prospective economic advantage.
We affirmed the trial court's judgment in favor of the defendants in that action in case No. E052105 (Siciliano v. Artiano (Oct. 21, 2011, modified Nov. 8, 2011, E052105 [nonpub. opn.]).
In December 2006, counsel for Roupwatie sent Siciliano a letter informing him that Roupwatie had elected to void her contingency fee contract with him under Business and Professions Code section 6147, subdivision (b), because the contract did not comply with subdivision (a)(2) through (a)(5).
Chanda died in September 2007.
In October 2007, Roupwatie made an offer under Code of Civil Procedure section 998 to settle the action as to Louw for $17,501. Louw refused the offer.
Also in October 2007, Roupwatie moved for summary judgment or summary adjudication of plaintiffs' quantum meruit claims. The trial court denied the motion. In May 2008, this court issued a writ of mandate directing the trial court to vacate its order denying the motion for summary judgment and to issue a new order complying with Code of Civil Procedure section 437c, subdivision (g). In November 2008, the trial court again denied summary judgment as to plaintiffs' quantum meruit claims. This court issued a second writ of mandate again directing the trial court to specify the triable issues of fact regarding the quantum meruit claims. In November 2009, the trial court denied summary judgment for the third time and ordered the quantum meruit claims to proceed to trial.
Trial began in May 2010. Roupwatie stipulated to liability for all the elements of quantum meruit, but she contested the reasonable value of the services provided. Siciliano testified that he believed Roupwatie had retained him under an agreement that provided for a 40 percent contingency fee.
Plaintiffs submitted a proposed special jury instruction that would have directed the jury to measure the reasonable value of plaintiffs' services based on a pro rata share formula. Roupwatie requested a special verdict form that would have had the jury determine the number of hours each attorney had worked and a reasonable hourly rate. The trial court rejected both proposals and instead gave its own special jury instruction.
Plaintiffs proposed the following jury instruction: "In determining a reasonable fee for plaintiffs' services, you may consider the following factors, among others:
"(a) The fee agreed to between the attorney and client as compensation for the services rendered.
"(b) The contingency factor the attorney faced in rendering the services.
"(c) The delay the attorney faced in receiving a fee for services.
"(d) The time and effort the attorney put forth in rendering the services.
"(e) The amount of money involved.
"(f) The results obtained.
"(g) The difficulty of the work.
"(h) Settlement offers made and received by the attorney.
"(i) Whether the attorney was on the courthouse steps at the time of discharge, with the client obtaining a settlement thereafter."
The trial court instructed the jury as to the reasonable value of attorney services as follows:
"In determining the reasonable value of services provided by an attorney, you may consider any of the following:
"1. The time and effort the attorney put forth in rendering the services; "2. The work done;
"3. The work done by other attorneys to secure the ultimate recovery; "4. The ultimate recovery in proportion to the fee claimed;
"5. The actual number of hours expended by the attorney in performing legal services for the client;
"6. The attorney's hourly rates;
"7. The hourly rates of attorneys of similar qualifications in the community;
"8. The novelty and difficulty of the questions involved and the skill necessary to
perform the legal services properly;
"9. Any delay in being paid agreed to by the attorney at the outset of the attorney-client relationship;
"10. The likelihood, if apparent to the client, that the acceptance of the particular
employment will preclude other employment by the attorney;
"11. The results obtained, if any, attributable to the attorney's legal services;
"12. The time limitations imposed by the client or by the circumstances;
"13. The nature and length of the professional relationship with the client;
"14. The experience, reputation and ability of the attorney performing the services; and "15. As to [Louw] only: the fee initially agreed to by the client as evidenced by the attorney-client retainer agreement and
"16. As to [Louw] only: the contingency factor as expressed in the original attorney-client retainer agreement, i.e., the risk of minimal or no attorney fees. "In determining the reasonable value of [Siciliano's] services, you must not take into account any fee agreement that may have been evidenced in any original attorney-client retainer agreement. In determining the reasonable value of [Siciliano's] services you must not take into account any contingency factor that may have been expressed in any original attorney-client retainer agreement.
"A client may discharge his or her attorney at any time and without cause.
"An attorney is entitled to recover the reasonable value of his or her services even if she or he is discharged with cause."
The jury entered special verdicts in favor of plaintiffs, awarding damages of $17,165 to Louw and $46,419 to Siciliano.
Additional facts are set forth in the discussion of the issues to which they pertain.
III. DISCUSSION
A. Requests for Judicial Notice
Roupwatie has requested this court to take judicial notice of the record and our tentative opinion in case No. E052105. That request is denied, except to the extent that the designated materials are relevant to the procedural background of this case. We have determined that the designated materials would not be helpful to our determination of the issues in the present case.
Plaintiffs have requested this court to take judicial notice of our records in the two prior writ proceedings, case Nos. E045162 and E047310. That request is granted.
B. Law of the Case
Plaintiffs contend the trial court erred by failing to adhere to law of the case and by precluding Siciliano from admitting his terminated contingency fee agreement into evidence to show the reasonable value of his services, thereby limiting him to an improper hourly fee.
1. Additional Background
Roupwatie moved for summary judgment in the trial court on plaintiffs' quantum meruit claims on the ground that it was undisputed how much billable time each attorney provided and which tasks each accomplished, and the reasonable value of plaintiffs' services was a pure issue of law. Specifically, Roupwatie requested entry of judgment in favor of Louw in the amount of $17,000, representing 68 hours Louw spent on the case at the rate of $250 per hour. Roupwatie requested entry of judgment in favor of Siciliano in the amount of $33,750, representing 135 hours at the rate of $250 per hour.
The trial court denied the motion, and Roupwatie filed a petition for writ of mandate. Siciliano opposed the petition on the ground that quantum meruit recovery for a discharged attorney is not limited to an hourly rate, and an attorney discharged "on the courthouse steps" may be entitled to his entire contingency fee. Siciliano cited Cazares v. Saenz (1989) 208 Cal.App.3d 279 (Cazares); and Schneider v. Kaiser Foundation Hospitals (1989) 215 Cal.App.3d 1311 (Schneider), overruled on another ground as stated in Moncharsh v. Heily & Blase (1992) 3 Cal.4th 1, 27, in support of his argument.
We issued an opinion on July 17, 2009, stating: "In essence, [Roupwatie] contends that the reasonable value of [plaintiffs'] services is the number of hours each worked on the case, multiplied by their hourly rate. While this method is sometimes used for determining reasonable value of services, an attorney may be entitled to a pro rata share of the contingency fee or perhaps the entire fee." We cited Fracasse v. Brent (1972) 6 Cal.3d 784 (Fracasse)as well as Cazares and Schneider.
At trial, Roupwatie moved to exclude evidence of Siciliano's contingency fee contract and to preclude the jury from considering the contingency fee provided for in that contract in awarding the reasonable value of his services. Siciliano opposed the motion on the ground, among others, that this court had stated in its prior opinion that he may be entitled to his entire contingency fee if not a pro rata share of it. The trial court granted Roupwatie's motion and precluded Siciliano from introducing his contingency fee contract or any of its terms. The trial court stated this court's statements in its opinion in case No. E047310 were not law of the case.
Plaintiffs moved for new trial on the grounds, among others, that the trial court failed to follow the law of the case; that the jury instructions were erroneous; and that evidence was improperly admitted of work Artiano had done on Roupwatie's behalf after plaintiffs' discharge. The trial court denied the motion, reasoning as to the law of the case argument as follows: "In reviewing the Court of Appeal opinion in the earlier writ of mandate proceedings, this Court believed a fair reading of that opinion was that depending on the circumstances, an attorney may be entitled to a fee that reflects the contingency nature of his or her initial fee agreement and/or a fee that reflects how much work he or she did in relation to the total work needed to secure their former client's ultimate aw[a]rd. . . . As to Attorney Siciliano, the jury was not permitted to consider his contingency fee agreement because that contract was in violation of Business and Professions Code section 6147 (See [Fergus v. Songer](2007) 150 Cal.App.4th 552) but they were permitted to consider a number of other factors and not limited to an hourly fee times number of hours spent computation. The void nature of Mr. Siciliano's attorney fee agreement and whether or not it would be appropriate for a jury to rely on the same was not an issue before the Court of Appeal on the petition for writ of mandate. The admissibility of it was not a consideration addressed by the Court of Appeal or necessary to its decision. It is still this Court's view that the law of the case doctrine did not require it to disregard the holding in [Fergus v. Songer, supra]."
2. Analysis
"'[W]here an appellate court states in its opinion a principle of law necessary to the decision, that principle becomes law of the case and must be adhered to in all subsequent proceedings, including appeals. [Citations.]'" (Adams v. Pacific Bell Directory (2003) 111 Cal.App.4th 93, 97.) The law of the case doctrine applies in writ proceedings when the court has issued an opinion addressing the merits of the petition. (Kowis v. Howard (1992) 3 Cal.4th 888, 894.)
In our prior opinion, as noted, we cited Fracasse, Cazares, and Schneider for the proposition that under appropriate circumstances, an attorney who is discharged may be entitled to a pro rata share of the contingency fee or perhaps the entire contingency fee in quantum meruit. (See Fracasse, supra, 6 Cal.3d at pp. 790-791; Cazares, supra, 208 Cal.App.3d at pp. 288-289; Schneider, supra, 215 Cal.App.3d at pp. 1316-1317.) Siciliano contends that our citations to Fracasse, Cazares, and Schneider meant, in effect, that the trial court could rely only on those authorities. However, we did not state—nor did we intend to imply—that the trial court could consider only those cases. Instead, we specifically observed that the hourly rate method was sometimes used to determine a reasonable fee. By making that observation, we acknowledged the validity of other authorities in fee litigation. We further acknowledged that under certain circumstances "an attorney may be entitled to a pro rata share of the contingency fee or perhaps the entire fee." (Italics added.) And even the court in Cazares recognized that a reasonable fee may, in appropriate circumstances, be based on the discharged attorney's portion of the total number of hours spent by all attorneys on the case. (Cazares, supra, at p. 288.) We therefore reject Siciliano's claim that the trial court violated the law of the case doctrine in relying on other authorities.
C. Jury Instructions as to Siciliano
Siciliano contends the trial court erred in relying on Fergus v. Songer, supra, 150 Cal.App.4th 552(Fergus)as the basis for the instruction that precluded the jury from considering Siciliano's contingency fee contract when determining the reasonable amount of his fee. He argues that even if the law of the case doctrine does not apply, the contingency fee contract was still admissible to prove the reasonable value of the services he provided.
The trial court found that Siciliano's contingency fee contract did not comply with Business and Professions Code section 6147, subdivision (a)(2) through (a)(5) and therefore could not be used in the determination of Siciliano's reasonable fee. In Fergus, an attorney seeking to recover a reasonable fee for services contended the trial court had erred in failing to instruct the jury "that, in determining a reasonable fee, it could consider the contingent nature of the fee arrangement between [the attorney] and [the client]," because "'that is the only manner by which to allow for the broad range of economic considerations that can be crucial to a reasonable outcome.'" (Fergus, supra, 150 Cal.App.4th at pp. 572-573.) The court rejected that argument, explaining that when "a client exercises his right to void a contingency fee agreement, [Business and Professions Code] section 6147 does not permit the trier of fact to consider the contingent nature of the fee arrangement in determining a reasonable fee. If the contingency fee agreement is void, there is no contingency fee arrangement. 'A void contract is no contract at all; it binds no one and is a mere nullity. [Citation.] Consequently, such a contract cannot be enforced. [Citation.]' [Citation.] [¶] The deterrent and protective purposes of [Business and Professions Code] section 6147 would be impaired if an attorney who was barred from enforcing a contingency fee agreement would nevertheless be entitled to a percentage of the recovery based on the contingent risk factor. The attorney would in effect be receiving a contingency fee even though the contingency fee agreement had been voided by the client." (Id. at p. 573.)
"(a) An attorney who contracts to represent a client on a contingency fee basis shall, at the time the contract is entered into, provide a duplicate copy of the contract, signed by both the attorney and the client, or the client's guardian or representative, to the plaintiff, or to the client's guardian or representative. The contract shall be in writing and shall include, but is not limited to, all of the following:
"[¶] . . . [¶]
"(2) A statement as to how disbursements and costs incurred in connection with the prosecution or settlement of the claim will affect the contingency fee and the client's recovery.
"(3) A statement as to what extent, if any, the client could be required to pay any compensation to the attorney for related matters that arise out of their relationship not covered by their contingency fee contract. This may include any amounts collected for the plaintiff by the attorney.
"(4) Unless the claim is subject to the provisions of Section 6146 [claims for professional negligence against health care providers], a statement that the fee is not set by law but is negotiable between attorney and client.
"(5) If the claim is subject to the provisions of Section 6146, a statement that the rates set forth in that section are the maximum limits for the contingency fee agreement, and that the attorney and client may negotiate a lower rate." (Bus. & Prof. Code, § 6147, subd. (a).)
In Fair v. Bakhtiari (2011) 195 Cal.App.4th 1135 (Fair), the court adopted the reasoning of Fergus in a quantum meruit action, explaining: "At the outset of an attorney-client business relationship, the incentive to make a full and reasonably understandable written disclosure (including disclosure of the right to seek independent advice) and to secure the client's written consent to the terms of the transaction will be minimized if the attorney knows that even if the agreements are later voided, the reasonable value of the services rendered may be established by the understandings contained in the voided agreements and that the value of those services . . . may be measured by the success of the businesses entered into in violation of the rule and in breach of the attorney's fiduciary duties. [Citations.]" (Fair, supra, at p. 1163.) The Fair court cited Fergus for the proposition that quantum meruit recovery "could be proved by evidence of the amount involved and the results obtained. However, the deterrent and protective purposes of the statute requiring that a contingency fee agreement must include a statement that the fee is not set by law, but is negotiable between the client and attorney, would be impaired if an attorney barred from enforcing the contingency fee agreement could argue he or she was entitled to a percentage of the recovery based on the contingent risk factor." (Fair, supra, at pp. 1163-1164.)
Siciliano argues the issue of the Business and Professions Code section 6147 violation was previously before this court, and the trial court was therefore precluded from revisiting its applicability. He notes: "On page 1, footnote 2 of her summary judgment motion, Roupwatie specifically asserted that both plaintiffs' contingency fee agreements were void under [Business and Professions Code] Section 6147. This motion was presented to this Court in both [prior writ] proceedings because [Roupwatie] included that document in the record when she sought to overturn the lower court's denial of her summary judgment motion." In addition, Siciliano argues that Roupwatie had asserted the affirmative defense that the contingency fee agreements were void. We reject the contention that the issue of the violation of Business and Professions Code section 6147 was raised in any prior proceedings in this court. Counsel is reminded that it is not the function of this court to search the record for possible error. (See, e.g., Durell v. Sharp Healthcare (2010) 183 Cal.App.4th 1350, 1372.) The issue was never explicitly brought to our attention, and we did not rule on it.
Siciliano next argues that Fergus was wrongly decided. However, the Cazares court cautioned that "[r]eliance on the agreed price necessarily assumes it was the product of arms-length negotiations and that the parties are of relatively equal bargaining power. [Citation.]" (Cazares, supra, 208 Cal.App.3d at p. 288, fn. 9.) When a client voids a contingency fee contract because it failed to comply with the requirements of Business and Professions Code section 6147, that underlying assumption simply does not apply. Siciliano further argues that Fergus is inconsistent with the California Supreme Court's opinion in Fracasse. However, the court in Fracasse had no occasion to consider the effect of Business and Professions Code section 6147, subdivision (a) in the context of quantum meruit recovery—that section was not yet enacted in 1972 when the Fracasse opinion was issued, and Fracasse did not deal with an invalid contract. (Fracasse, supra, 6 Cal.3d 784.) "It is axiomatic that cases are not authority for propositions not considered. [Citation.]" (Environmental Charter High School v. Centinela Valley Union High School Dist. (2004) 122 Cal.App.4th 139, 150.) Fergus is therefore not inconsistent with Fracasse.
Finally, Siciliano argues that Fergus is distinguishable because in Fergus the client voided the contingency fee agreement after the attorney obtained a recovery for the client. He claims his own contract was terminated when Roupwatie discharged him in July 2005, and when she purported to void the contract in December 2006, there was no longer an enforceable contract. Thus, he argues, because the agreement was never voided before termination, it was valid and operative until it was terminated and could not be voided thereafter. In Alderman v. Hamilton (1988) 205 Cal.App.3d 1033, 1038, an attorney filed suit against former clients arguing that they had breached an attorney fee agreement when they refused to pay a contingency fee. The court held that because the fee agreement did not meet all the requirements of Business and Professions Code section 6147, the clients "had an absolute right to void the contract before or after services were performed." (Alderman v. Hamilton, supra, at p. 1038.) Here, likewise, Roupwatie had an absolute right to void the attorney fee contract with Siciliano.
In summary, we agree with the Fergus and Fair courts that it would be anomalous to allow a client to void a contract on the basis it did not comply with Business and Professions Code section 6147 but to nonetheless allow the attorney who drafted the contract to obtain enforcement of terms favorable to himself. This is even more so when a specific provision of Business and Professions Code section 6147 that was omitted was that the contract must inform the client that a contingent fee is negotiable. (Bus. & Prof. Code, § 6147, subd. (a)(4).) The trial court did not err in its instruction to the jury on the factors it could consider in determining Siciliano's reasonable fee under quantum meruit principles. We will therefore affirm the judgment as to Siciliano.
D. Jury Instructions as to Louw
Louw contends the trial court erred in issuing erroneous and confusing jury instructions that allowed the jury to measure the value of her services by an hourly rate instead of by a pro rata share formula. Citing Cazares, she argues she "should have been awarded a fee governed exclusively by the pro rata share formula that looked at whether she put in 100% of the ultimate work that went toward obtaining the $100,000 offer to settle or some lesser amount," and that the instructions presented the jury with "a confusing and erroneous either/or scenario whereby they could either award [her] a fee based on a percentage of the recovery or simply limit her to the hours she accumulated multiplied by a flat hourly rate."
We disagree with Louw's characterization of the task before the jury. The instruction as given did not present an "either/or scenario," but instead properly informed the jury of the range of factors, including the contingency fee contract, it might consider in determining a reasonable fee. As the court explained in Mardirossian & Associates, Inc. v. Ersoff (2007) 153 Cal.App.4th 257, 272, "'The most useful starting point for determining the amount of a reasonable fee is the number of hours reasonably expended on the litigation multiplied by a reasonable hourly rate. This calculation provides an objective basis on which to make an initial estimate of the value of a lawyer's services. The party seeking an award of fees should submit evidence supporting the hours worked and rates claimed." [Citation.] However, providing evidence as to the number of hours worked and rates claimed is not the end of the analysis in such a quantum meruit action. The party seeking fees must also show the total fees incurred were reasonable. Factors relevant to that determination include '[t]he nature of the litigation, its difficulty, the amount involved, the skill required in its handling, the skill employed, the attention given, the success or failure of the attorney's efforts, the attorney's skill and learning, including his [or her] age and experience in the particular type of work demanded.' [Citations.]" Thus, the court held that testimony about hours spent on the case and expert testimony about reasonableness of hours spent was admissible in a quantum meruit action brought by an attorney against a client who had terminated representation under a contingency fee agreement days before settling the litigation. (Ibid.)
The Fracasse court cited with approval Los Angeles v. Los Angeles-Inyo Farms Co. (1933) 134 Cal.App. 268, disapproved on another ground by Metropolitan Water Dist. v. Adams (1944) 23 Cal.2d 770, 772-773, for its list of "factors which should be taken into consideration in determining a reasonable fee." (Fracasse, supra, 6 Cal.3d at p. 791.) Those factors include: "The nature of the litigation, its difficulty, the amount involved, the skill required in its handling, the skill employed, the attention given, the success or failure of the attorney's efforts, the attorney's skill and learning, including his age and experience in the particular type of work demanded. [Citations.]" (Los Angeles v. Los Angeles-Inyo Farms Co., supra, at p. 276.) We conclude the instruction given in this case properly allowed the jury to consider the full range of relevant factors.
Louw speculates, however, that the jury improperly adopted the instructions given as to Siciliano's fee to calculate her own fee. Contrary to her speculation, we presume the jury understood and properly applied the instructions given. (Pugh v. See's Candies, Inc. (1988) 203 Cal.App.3d 743, 765.) The fact that the jury chose to base its determination of Louw's reasonable fee on an hourly rate does not indicate the jury disregarded or misapplied the instructions given—it merely means the jury determined that under the circumstances, an hourly rate was the most reasonable basis for calculating her reasonable fee. That determination was solely within the province of the jury.
E. Evidentiary Rulings
Plaintiffs contend the trial court erred by admitting evidence of (a) their hourly rates; (b) prelitigation offers to settle; (c) work performed by Roupwatie's subsequent attorneys after plaintiffs' discharge; and (d) the death of Chanda.
1. Evidence of Plaintiffs' Hourly Rates
Plaintiffs moved in limine to exclude evidence of their hourly rates on the ground it was irrelevant under the pro rata share formula set forth in Cazares. The trial court denied the motion, and evidence of plaintiffs' hourly rates was admitted into evidence. As discussed above, under the relevant authorities, the jury could reasonably consider plaintiffs' hourly rates in determining the amount of plaintiffs' reasonable fees. (E.g., Mardirossian & Associates, Inc. v. Ersoff, supra, 153 Cal.App.4th at p. 272.) There was no error.
2. Prelitigation Offers to Settle
During cross-examination, Louw testified she had sent a letter to Siciliano requesting a fee of $33,333. She was asked if it had been communicated to her, before there was any dispute, that Roupwatie wanted to pay her for 68 hours at the rate of $250 per hour. Her counsel objected "if it's an offer to compromise." Louw testified that she did not recall such an offer. She further testified she did not recall Roupwatie's attorney ever offering her a specific figure. Louw's counsel later renewed his objection to offers or attempts to negotiate with Louw about her fee before the lawsuit was filed. The trial court overruled the objection, and Louw's counsel moved for a mistrial, which the trial court denied.
Although plaintiffs now claim error in the admission of a prelitigation offer to settle, the record makes clear that Louw in fact testified she did not recall ever receiving such an offer. Thus, no testimony of an offer to settle with Louw was admitted. It is axiomatic that questions asked by counsel are not evidence. (See, e.g., CACI No. 106.) There was no error.
Plaintiffs also appear to base their contention of error on the closing argument of Roupwatie's counsel: "I think she [Louw] spent 68 hours in the case. I'd take her word for it even though we don't see the records, and I'm just asking that you pay her back what Mrs. Singh had authorized Mr. Artiano to pay her a long time ago, almost four years ago, which she obviously would not accept, she preferred to lien her client." Plaintiffs' counsel did not object to the argument or request the trial court to give a curative admonition to the jury and so has forfeited any resulting error. (E.g., N.N.V. v. American Assn. of Blood Banks (1999) 75 Cal.App.4th 1358, 1397-1398.) Moreover, the trial court specifically instructed that "what the lawyers have to say to you is not evidence in the case," and that if the lawyers' arguments differed from the jury's own recollection, the jury was to go by its own memory of the testimony. We presume the jury understood and followed that instruction. (Pugh v. See's Candies, Inc., supra, 203 Cal.App.3d at p. 765.)
Plaintiffs next argue that Roupwatie's attorney improperly elicited evidence that Artiano had made an offer to Siciliano to reimburse him for out-of-pocket costs incurred during representation of Roupwatie. When the question was asked, plaintiffs' counsel stated merely, "[J]ust for the record, objection." The trial court overruled the objection, and Siciliano testified that he believed Artiano had made such an offer but he had chosen not to take it. Given that Siciliano's counsel did not identify any specific ground for the objection at trial, he has not preserved the issue for appeal. (Evid. Code, § 353.) Moreover, it was never suggested that an offer to reimburse for costs incurred was an offer to settle the case.
When Artiano took the stand, he was asked whether he had offered to compensate plaintiffs for the reasonable value of their services, and he responded, "Constantly." Plaintiffs' counsel objected on the ground of Evidence Code sections 352 and 1152. The trial court responded, "Okay. It calls for a legal conclusion, so I'm going to sustain my own objection." Artiano further testified he had asked plaintiffs for billing statements so he could compensate them, and they had refused. When plaintiffs' counsel objected and moved to strike, the trial court granted the motion to strike. Thus, again, no evidence of an offer to settle was actually admitted. There was no error.
3. Chanda's Death
Plaintiffs moved in limine to exclude evidence that Chanda had died in 2007. The trial court ruled that the jury could consider the fact of Chanda's death, but not the circumstances of his death, in understanding Roupwatie's background information.
Roupwatie did not testify at trial. Evidence was introduced, however, that Chanda had entered into retention agreements and had interacted with plaintiffs on her behalf. In fact, Louw never even met Roupwatie until after Louw had been discharged from representation. Siciliano testified that Chanda had disagreed with him about his handling of the case and whether to file a loss of consortium complaint on Chanda's behalf, and he had told Chanda that if Chanda was not happy with his services, Chanda should get another lawyer. Artiano testified that Chanda was not present at trial because he was deceased. Plaintiffs' counsel objected without specifying grounds, and the trial court overruled the objection. Plaintiffs' counsel later moved for a mistrial on the ground that "it's a bell that was rung that can't be unrung."
The entire exchange on the subject was as follows:
"Q [Counsel for Roupwatie] Is there a reason why Mr. Singh is not able to testify in this court?
"A Yes.
"[Counsel for plaintiffs]: Objection, Your Honor.
"[Counsel for Roupwatie:] No circumstances. Just the facts.
"THE COURT: The objection is overruled.
"[Counsel for Roupwatie]: Please tell us why.
"A Mr. Singh is deceased."
We summarily reject on the merits the claim that the bare statement, "Mr. Singh is deceased," evoked passion and prejudice in the jury and requires reversal. We have more faith than plaintiffs do in the common sense and integrity of jurors. Nothing whatsoever in the record indicates the jury based its verdict on merely hearing that Chanda was deceased, and for plaintiffs to suggest otherwise exceeds the bounds of vigorous appellate advocacy.
4. Work Performed by Other Attorneys
Plaintiffs moved in limine to exclude evidence of services performed by other attorneys after plaintiffs were discharged. The ground for the motion was that the subsequent attorneys had placed no competing quantum meruit claim, and the two-year statute of limitations for such a claim had passed. The trial court denied the motion, and evidence was introduced that lawyers and paralegals at the Stutz firm had spent 686.9 hours in representing Roupwatie.
In ruling on plaintiffs' motion for new trial, the trial court explained its decision to allow evidence of the other attorneys' work on the case: "The Court allowed the admission of that evidence so that the jury could make an informed decision as to what was done, as a whole, to secure the Singhs' recovery which may have been useful to the jury in deciding whether or not the plaintiff attorneys had done all or substantially all, as asserted by plaintiffs, of the work necessary for the settlements."
We agree with the trial court's ruling. Determination of plaintiffs' reasonable fees necessarily required evidence not only of the work plaintiffs had performed on the case, but also of the work others had done that ultimately led to the settlement. In Spires v. American Bus Lines (1984) 158 Cal.App.3d 211, the court held that when "the contingent fee is insufficient to meet the quantum meruit claims of both discharged and existing counsel, the proper application of the Fracasse rule is to use an appropriate pro rata formula which distributes the contingent fee among all discharged and existing attorneys in proportion to the time spent on the case by each. Such a formula insures that each attorney is compensated in accordance with work performed, as contemplated by Fracasse . . . ." (Id. at p. 216.)
Siciliano also asserts that Artiano's "testimony was nothing short of an illegal attempt to collect a fee beyond the statute of limitations without any actual claim for quantum meruit. By assisting defendants in doing this, the trial court exceeded its jurisdiction and aided in the collection of an illegal fee." Such an argument is not only preposterous; it is also so offensive as to border on contempt of court. We therefore make no response other than to reject outright his premise. Artiano and the Stutz firm's entitlement to a fee was not at issue in this case, and the judgment in no way purported to determine any issue as to the fee, if any, to which they might be entitled. We deplore plaintiffs' lack of respect for the integrity of the trial court. Plaintiffs are reminded that "zealous advocacy does not equate with 'attack dog' or 'scorched earth'; nor does it mean lack of civility." (In re Marriage of Davenport (2011) 194 Cal.App.4th 1507, 1537.)
F. Denial of Prejudgment Interest
Plaintiffs contend the trial court erred in denying their motion for prejudgment interest.
1. Additional Background
As recounted above, $331,919 of Roupwatie's recovery was placed into a blocked account in July 2006. Siciliano and Artiano signed a document stating that funds would be disbursed only under the signature of both of them or by order of court, and that "[a]ll interest accrued in the account from the date funds are collected to the date of final disbursement shall accrue to, and be paid to," Roupwatie. Louw and Siciliano filed suit against Roupwatie on August 23, 2006. In December 2006, Roupwatie and her counsel made an offer to settle Siciliano's quantum meruit claim, as well as his claim against her subsequent attorneys for intentional interference, for $32,687.50. In October 2007, Roupwatie made an offer to settle with Louw for $17,501. During trial, Roupwatie and her counsel made an oral offer to settle with Siciliano for $42,000.
In denying Louw's request for prejudgment interest, the trial court stated that she had failed to obtain a more favorable verdict than Roupwatie's offer to settle. In denying Siciliano's request, the trial court reasoned that he had been seeking a fee of $290,000, but he had obtained a verdict of only $46,419.
2. Standard of Review
Prejudgment interest is discretionary as to unliquidated claims based upon a cause of action in contract (Civ. Code, § 3287, subd. (b)), and we therefore review the trial court's ruling under the deferential abuse of discretion standard. (See Esgro Central, Inc. v. General Ins. Co. (1971) 20 Cal.App.3d 1054, 1064.)
3. Analysis
Civil Code section 3287, subdivision (b) provides: "Every person who is entitled under any judgment to receive damages based upon a cause of action in contract where the claim was unliquidated, may also recover interest thereon from a date prior to the entry of judgment as the court may, in its discretion, fix, but in no event earlier than the date the action was filed." An action in quantum meruit is an action in contract within the meaning of that statute. (George v. Double-D Foods, Inc. (1984) 155 Cal.App.3d 36, 46-47.) In A & M Produce Co. v. FMC Corp. (1982) 135 Cal.App.3d 473, the court identified a number of factors the trial court may consider in exercising its discretion under Civil Code section 3287, subdivision (b): the length of time that had passed between the filing of the complaint and the time judgment was entered; the market interest rates during that period; and offers to settle. (A & M Produce Co. v. FMC Corp., supra, at p. 496.) Here, no evidence of market interest rates was presented.
Defendants argue that the trial court abused its discretion because it applied inconsistent standards—it denied interest to Louw because the settlement offer was greater than the eventual verdict, and it also denied interest to Siciliano even though the offer to settle was less than the ultimate verdict. As to Siciliano, the trial court also based its decision on the fact that his recovery was significantly less than his consistent demand for a fee of $290,000. Finally, the trial court was entitled to, and did, take into account that the money deposited in the blocked account ($331,919) exceeded the maximum that Louw and Siciliano collectively claimed ($325,417): Louw claimed 33 1/3 percent of $100,000 plus $165 in costs, and Siciliano claimed 40 percent of $725,000 plus $1,919 in costs. We find no fatal inconsistency in the trial court's reasoning and no abuse of discretion in its ruling. We note, moreover, that the parties' stipulation to set aside the funds pending resolution of the case specifically called for interest on the account to be awarded to Roupwatie. We find that contract dispositive.
Although the trial court stated in open court in ruling on the request for prejudgment interest that the settlement offer was greater than the eventual verdict, in its final ruling, the trial court held that when Louw's allowable preoffer costs were included, her recovery exceeded the settlement offer. As we discuss below, we agree with the trial court's holding.
G. Attorney Fees and Costs
In ruling on the parties' requests for costs and attorney fees, the trial court ruled that (a) plaintiffs' complaint for quantum meruit was not an action on a contract for purposes of Civil Code section 1717; (b) Louw's action in quantum meruit was not an action under her contract with Roupwatie for purposes of entitlement to attorney fees as costs under Code of Civil Procedure sections 1021, 1032, and 1033.5; (c) Louw was not the prevailing party for purposes of entitlement to costs under Code of Civil Procedure section 1021, 1032, and 1033.5; and (d) in the alternative, Louw's recovery at trial, when allowable pre-offer costs were included, exceeded Roupwatie's offer to settle under Code of Civil Procedure section 998. Roupwatie appeals from the first ruling, and also contends the trial court erred in the last ruling. Louw contends the trial court erred in the remaining two rulings.
1. Additional Background
Louw's contingency fee contract with Roupwatie contained an attorney fee provision, as follows: "In the event that any party commences litigation with respect to the payment or amount of payment of legal fees or costs under this Agreement, then the prevailing party shall be entitled to the award of reasonable attorney's fees by the court in addition to the reimbursement for costs incurred." Another provision of the agreement stated, "Should Client change attorneys during pursuit of his claim or unilaterally decide to drop his lawsuit, Client shall pay Attorney for work done prior to the substitution of attorney or dropping of the lawsuit either on the basis of $250 per hour or at the agreed contingency rate, at the option of Attorney."
Louw's consistent position in the litigation was that she was entitled to a fee of $33,333.33 in attorney fees plus costs, based on the contingency fee rate of 33 1/3 percent applied to the $100,000 offer to settle she had received on Roupwatie's behalf. As recounted above, Roupwatie made an offer to Louw under Code of Civil Procedure section 998 to settle the matter for $17,501 in October 2007. Louw rejected the offer. At trial, Roupwatie stipulated that she had requested and received attorney services from Louw, and she had not paid for those services. Her counsel argued that Louw should be awarded $17,000 in fees based upon Louw's 68 hours of time expended on the case at a rate of $250 per hour, and Roupwatie agreed she was obligated to pay Louw $165 in costs Louw had incurred on her behalf. The jury awarded Louw exactly $17,165.
Following trial, Roupwatie moved for an award of attorney fees on the basis that she "prevailed on the contract by successfully limiting Ms. Louw's recovery to less than the amount of the [Code of Civil Procedure section] 998 Offer." Louw filed an opposition to Roupwatie's motion, submitted a memorandum of costs seeking approximately $2,100, and filed her own motion for attorney fees and costs seeking $34,645.
The trial court taxed all of Louw's costs and denied her motion for attorney fees. The trial court ruled that the contingency fee contract was vague and ambiguous with respect to attorney fees, and the ambiguity would be interpreted in favor of Roupwatie, the non-drafter. The court thus held that the phrase "under this Agreement" applied only to a breach of contract claim, and Louw's quantum meruit claim was not such a claim. The trial court further held that Louw was not entitled to costs or attorney fees against Roupwatie under Code of Civil Procedure sections 1021 and 1032, because Louw's victory was pyrrhic. Finally, the trial court ruled, in the alternative, that Louw had done better at trial than under Roupwatie's Code of Civil Procedure section 998 offer. The trial court also denied Roupwatie's motion for attorney fees, concluding that a claim for quantum meruit is not an "action on a contract" within the meaning of Civil Code section 1717. The trial court found, however, that if Civil Code section 1717 did apply, Roupwatie would be the prevailing party because "virtually all of her litigation objectives were achieved."
2. Roupwatie's Claim for Attorney Fees Under Civil Code Section 1717
Civil Code section 1717, subdivision (a) provides : "In 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 in addition to other costs."
The parties have cited no authority addressing whether an action in quantum meruit is an "action on a contract" for purposes of Civil Code section 1717, and our own research has revealed no such authority. As discussed above, an action in quantum meruit has been held to be "a cause of action in contract" for purposes of an award prejudgment interest on unliquidated claims arising upon a cause of action in contract. (Civ. Code, § 3287, subd. (b), italics added; George v. Double-D Foods, Inc., supra, 155 Cal.App.3d at pp. 46-47.) Other courts have held that "[b]y its terms, [Civil Code] section 1717 'covers only contract actions, where the theory of the case is breach of contract, and where the contract sued upon itself specifically provides for an award of attorney fees incurred to enforce that contract.' [Citation.]" (Childers v. Edwards (1996) 48 Cal.App.4th 1544, 1548.) In Exxess Electronixx v. Heger Realty Corp. (1998) 64 Cal.App.4th 698, the court held that an attorney fee provision in a commercial lease did not authorize an award of fees under Civil Code section 1717 on tort claims of constructive fraud and breach of fiduciary duty that were not brought either to "'enforce the terms'" of or "'declare rights []under'" the lease. (Exxess Electronixx v. Heger Realty Corp., supra, at pp. 709-711.) Likewise, the court held, the prevailing plaintiff's claims for contribution and indemnity were created solely by operation of law and principles of equity, not by the lease, and thus were not covered by the attorney fee provision in the lease. (Id. at pp. 714-715.)
This is an equitable action for quantum meruit, not an action to enforce a contract. "A quantum meruit or quasi-contractual recovery rests upon the equitable theory that a contract to pay for services rendered is implied by law for reasons of justice." (Hedging Concepts, Inc. v. First Alliance Mortgage Co. (1996) 41 Cal.App.4th 1410, 1419.) We therefore reject Roupwatie's argument that she was entitled to attorney fees under Civil Code section 1717.
H. Applicability of Code of Civil Procedure Sections 1021, 1032, and 1033.5
Louw argues she was a prevailing party, and thus, she is entitled to an award of costs, which should include attorney fees under Code of Civil Procedure sections 1021, 1032, and 1033.5 based on the attorney fee provision of her contract with Roupwatie. We first examine whether the trial court erred in denying her costs, and then we address whether her contract with Roupwatie entitled her to attorney fees as an element of costs.
"Except as attorney's fees are specifically provided for by statute, the measure and mode of compensation of attorneys and counselors at law is left to the agreement, express or implied, of the parties; but parties to actions or proceedings are entitled to their costs, as hereinafter provided." (Code Civ. Proc., § 1021.)
"'Prevailing party' includes the party with a net monetary recovery, . . ." (Code Civ. Proc., § 1032, subd. (a)(4).) "Except as otherwise expressly provided by statute, a prevailing party is entitled as a matter of right to recover costs in any action or proceeding." (Code Civ. Proc., § 1032, subd. (b).)
"(a) The following items are allowable as costs under Section 1032: [¶] . . . [¶] (10) Attorney's fees, when authorized by any of the following: [¶] (A) Contract." (Code Civ. Proc., § 1033.5.)
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1. Louw's Entitlement to Costs
The trial court found that Louw had received a net monetary recovery. However, the trial court further found she was not the prevailing party and denied her costs. Louw argues she was entitled to her costs as a matter of right under Code of Civil Procedure section 1032, subdivision (b).
In Sears v. Baccaglio (1998) 60 Cal.App.4th 1136 (Sears), the court held that when one party recovered money and the other party received nonmonetary relief, Code of Civil Procedure section 1032 allowed the trial court to exercise discretion in determining which party had prevailed. (Sears, supra, at p. 1155.) Louw contends the trial court erred in relying on Sears to hold that it had discretion to determine that Louw was not the prevailing party even though she received a net monetary recovery.
Under Code of Civil Procedure section 1032, subdivision (b), "the trial court has no discretion to deny prevailing party status to a litigant who falls within one of the four statutory categories . . . ." (Wakefield v. Bohlin (2006) 145 Cal.App.4th 963, 975, disapproved on other grounds as stated in Goodman v. Lozano (2010) 47 Cal.4th 1327, 1338.) One of those categories includes a litigant with a net monetary recovery. (Code Civ. Proc., § 1032, subd. (a)(1.) Thus, we conclude the trial court erred in finding that Louw was not the prevailing party and in denying her costs under Code of Civil Procedure section 1032.
2. Settlement Offer and Louw's Pre-offer Costs
The trial court ruled, in the alternative, that if Louw were found to be the prevailing party, she would not be subject to cost-shifting penalties under Code of Civil Procedure section 998. The trial court found that Louw was entitled to $660 in pre-offer costs, comprising $167.50 for half the filing fee; $12.50 for half the service fee; $20 for half the filing fee for a demurrer to the answer; $20 for half the filing fee for a demurrer to the first amended answer; $20 for half the filing fee for a motion to strike the second amended answer; and $400 for half the reporter fees for Roupwatie's deposition. The court found that all those costs were "reasonably necessary to the conduct of . . . Louw's litigation and reasonable in amount." Adding $660 to the verdict of $17,165, the trial court found that Louw's recovery exceeded the settlement offer of $17,501 by $324.
"Whether a cost is 'reasonably necessary to the conduct of the litigation' is a question of fact for the trial court, whose decision will be reviewed for abuse of discretion. [Citations.]" (Gibson v. Bobroff (1996) 49 Cal.App.4th 1202, 1209.) We find no abuse of discretion in the trial court's rulings as to Louw's allowable preoffer costs.
Roupwatie contends, however, that the trial court erred in holding that Louw's recovery at trial verdict exceeded Roupwatie's pretrial offer to settle, because the trial court failed to take into account the fact that this court, in case No. E045162, awarded Roupwatie costs of $1,558.98 against Louw and Siciliano, and that award must be deducted from Louw's judgment to determine her net recovery. Roupwatie cited no authority in support of her argument, and we therefore deem it forfeited. (Benach v. County of Los Angeles (2007) 149 Cal.App.4th 836, 852.)
3. Entitlement to Attorney Fees as an Element of Costs
Code of Civil Procedure section 1021 does not state an independent basis for an award of attorney fees; rather, that section recognizes that parties may, by contract, opt out of the American rule for allocation of fees. Under that statute, the parties to a contract may agree the prevailing party will be awarded fees in litigation between themselves. (Xuereb v. Marcus & Millichap, Inc. (1992) 3 Cal.App.4th 1338, 1341; Santisas v. Goodin (1998) 17 Cal.4th 599, 608.) Whether attorney fees will be awarded for noncontractual claims depends on how broadly the underlying contract is worded. (Santisas v. Goodin, supra, at p. 608.) The scope of a contractual attorney fee provision is a legal issue which we review de novo. (Garcia v. Santana (2009) 174 Cal.App.4th 464, 468-469.)
The contract at issue provides for attorney fees to the prevailing party "[i]n the event that any party commences litigation with respect to the payment or amount of payment of legal fees or costs under this Agreement." (Italics added.) As noted, the trial court found the provision ambiguous as to whether it applied only to an action in contract or to any action with respect to the payment or amount of fees, and the ambiguity would be interpreted against Louw as the drafter of the agreement. Whether a contract is ambiguous is also a question of law which we review de novo. (Appleton v. Waessil (1994) 27 Cal.App.4th 551, 554-555.)
Here, as the trial court aptly pointed out, if the contract was intended to apply to any action relating to fees, the phrase "under this Agreement" would be superfluous. We agree with the trial court's analysis. The contract was ambiguous on that point.
In Thompson v. Miller (2003) 112 Cal.App.4th 327, the court held that successful defendants were entitled to attorney fees under Code of Civil Procedure section 1032 when the underlying agreement provided, "'The prevailing party in any dispute under this Agreement shall be entitled to reasonable attorneys fees incurred in such dispute.'" (Thompson v. Miller, supra, at pp. 333-337.) The court held that such wording was broad enough to apply to claims brought under theories of breach of fiduciary duty, fraud, and elder abuse when the plaintiffs had pleaded entitlement to contractual attorney fees in their original complaint, and the defendants had relied on other contractual language as the basis for their defense. (Ibid.) We, as did the trial court, find Thompson distinguishable on the basis that in Thompson, unlike in the present case, the contract was asserted as a defense, and therefore the action was "under the Agreement."
Louw also relies on Coast Plaza Doctors Hospital v. Blue Cross of California (2000) 83 Cal.App.4th 677, 681, in which the court held that an arbitration clause applied to noncontract claims when the contract provided for arbitration for "[a]ny problem or dispute arising under this Agreement and/or concerning the terms of this Agreement." (Id., fn. 2, italics in original.) Coast Plaza is distinguishable on its factual context alone. We conclude the trial court did not err in holding that the contingency fee contract did not entitle Louw to attorney fees as an element of costs.
IV. DISPOSITION
The judgment is affirmed as to Siciliano. As to Louw, the order denying her costs is reversed; however, her allowable costs shall not include attorney fees. On appeal, defendant shall recover her costs from Siciliano. Louw shall bear her own costs.
NOT TO BE PUBLISHED IN OFFICIAL REPORTS
HOLLENHORST
Acting P. J.
We concur: KING
J.
CODRINGTON
J.