Rossa v. D.L. Falk Construction

Filed 9/9/08 Rossa v. D.L. Falk Construction CA1/2

NOT TO BE PUBLISHED IN OFFICIAL REPORTS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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

FIRST APPELLATE DISTRICT

DIVISION TWO

Yet again, we confront an appeal contesting the attorneys fees awarded a litigant. Not the right to the fees, which is conceded. Only the reasonableness of the amount, which is not. The issue arises in a lawsuit arising out of a private contract for the building of a home, in which plaintiffs prevailed against the appealing defendant on one of five causes of action, obtaining a verdict for $100,000less than one-sixth of what plaintiffs originally sought. With little explanation, and no analysis, the trial court awarded plaintiffs over $681,000 in fees and costs, despite that plaintiffs motion was accompanied by no attorney timesheets or any other detailed record. The award included over $132,000 in expert witness fees, likewise supported by almost nothing.

We conclude that the amount awarded was an abuse of discretion. We thus reverse, and remand for the trial court to make an appropriate award supported by the law and the record.

I. BACKGROUND

A. The Setting and General Background Facts

The dispute has its genesis in the building of a home in Hillsborough. The dispute led to a vigorously contested, heavily discovered lawsuit culminating in a five-week jury trial. A detailed recitation of the facts in that trial is not germane to the issue before us, and will not be set forth except to the extent they bear on a particular issue under discussion. We begin with the general background facts.

Plaintiffs Steve and Connie Rossa (when referred to collectively, the Rossas) had purchased a lot in Hillsborough on which they were to build what they called their dream home. Sometime in 2001 the Rossas entered into a contract with Defonte Construction Company (Defonte), in connection with which Todd Peek was retained to prepare architectural plans. Defonte became unable to build the home because of a family illness, at which point Steve Rossa began to discuss the project with David Falk, president of the D.L. Falk Construction Company, (Falk) a business with which Rossa was acquainted due to its location near Rossas own drywall insulation business.

The Rossas and Falk apparently entered into a tentative understanding by May 2001, and by June 15, 2001, an actual contract was prepared, though final execution did not occur until October. Despite that, work on the project began in June.

The contract was over 25 pages long, and signed by the Rossas and Falk. It provided that Falk was to supply all labor, materials, equipment and supervision necessary to complete all of the work described in the attached Schedule B, which itself incorporated schedules A and D in defining the scope of work. The contract provided that Falk was to perform in accordance with the architectural drawings provided by Todd Peek. It also provided that Falk was to complete all the work for $1,694,113, with provision made for material allowances on several specified items. Other items were expressly excluded from the contract, as they were to be provided by, or arranged by, Rossa himself (Schedule D).

Paragraph 32.6 of the contract provides as follows: 32.6. If any party hereto commences an action or arbitration proceeding to interpret or enforce this Contract or any provision hereof, the prevailing party shall be entitled to an award of costs, attorneys fees and expert witness fees, in addition to all other amounts awarded by the court or arbitrator.

One aspect of the project excluded from the scope of Falks responsibility was surveying. Steve Rossa entered into a contract with R&R Surveying (R&R) to survey the property, allegedly for three express purposes: (1) to provide construction staking for the purpose of locating the home, swimming pool, retaining walls, and storm sewers; (2) to verify existing easements; and (3) to ensure that the project did not violate zoning or easement restrictions. R&R improperly surveyed the property, the effect of which was that a portion of the Rossas home was being built illegally, encroaching onto a side set back. The City of Hillsborough learned of the encroachment and ordered construction stopped. After months of delay, the encroachment problem was resolved, in connection with which the Rossas were required to make a $150,000 contribution to a charity designated by their neighbors.

The project began again after a delay of some five months, but not without incident. As the Rossas brief puts it, by mid-summer 2002 the tensions between the Rossas and Falk came to a head. And it was apparently downhill from there, as the Rossas further describe: Falk finally insisted on leaving the job in late August. The Rossas had no choice but to take over the half-finished project. By October 4, 2002, Falk had officially abandoned the site. (RT 525:6-526:6) They had to complete the house on their own and obtained a certificate of occupancy on December 18, 2003. (RT 386:20-387:9; 387:23-289:25.) This lawsuit followed.

B. The Pleadings and Pretrial Proceedings

On October 6, 2004, the Rossas filed their complaint. It named as defendants Falk and R&R, and alleged five causes of action: (1) breach of contract; (2) negligence; (3) breach of express warranty; (4) breach of implied warranty (reasonably workmanlike construction); and (5) breach of implied warranty (fitness for intended purpose). The first two causes of action were against Falk and R&R, the last three against Falk only.

Because of the surveying contract with R&R, the first cause of action for breach of contract merits further discussion here. This cause of action alleged that Falk breached its contract with the Rossas in myriad ways, one of which was that FALK knew of and concealed the fact that R&R improperly surveyed the Projects lot before FALK constructed portions of the Project over a setback easement required by the City of Hillsborough, causing among other things, Plaintiffs to make payment to their neighbors in an amount of $150,000.00 in or about April 2003. The first cause of action also alleged that R&R breached its contract with the Rossas by improperly surveying the Projects lot, so that Falk constructed portions of the project over a setback easement required by the City of Hillsborough.

As noted, the missurvey by R&R led to a significant delay, not to mention a significant expensethe $150,000 charitable contribution. This issue would come to be called the encroachment claim, and a significant dispute in the litigation was whether Falk was responsible for R&Rs dereliction, despite the Rossas direct contract with R&R.

The lawsuit generated extensive discovery, including at least 22 depositions, many of them of expert witnesses. As trial approached, the depositions intensified, especially those of expert witnesses. And according to a calculation prepared by one of the Rossas experts, as of late January 2006, their total damages were $688,272, including for the encroachment claim. The specific items were as follows:

On the eve of trial, the Rossas settled the encroachment claim with R& R for $185,000, significantly less than the amount listed on their experts calculation. This settlement became the subject of a February 6, 2006 motion for good faith settlement, which the court granted. Despite that the settlement with R&R was for less than the total amount of claimed damages, the encroachment claim disappeared from the trial, the Rossas abandoning attempts to collect on it from Falk.

C. The Trial

Trial proceeded against Falk, with the Rossas pursuing all five causes of action.[1] With the encroachment claim essentially removed from the trial, the case against Falk apparently sought some $360,000. And the case was, in the words of the Rossas counsel, in reality three cases: (1) the money case, (2) the delay case, and the (3) the defects case.

The money case was based on the claim Falk breached a promise to build the Rossas home for $1.7 million, and it sought two categories of damages: (1) a material overcharge of $54,854; and (2) unearned general conditions of $50,200.

The defects case, by contrast, was framed by the Rossas counsel in negligence terms: as counsel put it in closing argument, we have standard of care breaches for each of the defects. The defects case consisted of numerous items different from the money case, and included increased costs for the pool; several issues related to a crawlspace; rewiring problems; and various labor, material, and engineering expenses. The damages sought on the defects case was $133,388.

The delay case was likewise framed in negligence terms, and consisted of damages attributable to the months of delay claimed to have been caused by Falks negligence. As the Rossas counsel put it in closing argument: We have this breach of the standard of care for the delay case. Eight specific items were included in the delay case, for which the Rossas sought $66,000. [2]

D. The Verdict

As noted in footnote 1, at the conclusion of the evidence, the Rossas dismissed the three warranty claims, and the case was argued and submitted to the jury on two causes of action: breach of contract, and negligence. The jury verdict was follows:

On [the Rossas] cause of action for breach of contract against Falk, the jury finds for [the Rossas] against defendant Falk. The jury finds damages caused by the breach of contract in the amount of $100,000.

On [the Rossas] cause of action for negligence against Falk, the jury finds against [the Rossas] and for defendant Falk.

(E) The Cost Bill and the Judgment

On April 21, 2006, the Rossas filed a memorandum of costs seeking total costs of $45,344. The memorandum specifically said that it represented Total Costs not including attorneys fees, expert fees and other costs to be sought by motion. Falk filed no motion to tax. The trial court ultimately entered a nunc pro tunc judgment providing that: (1) the Rossas recover $100,000 plus post-judgment interest against Falk on their breach of contract cause of action; (2) the Rossas take nothing on their negligence cause of action; (3) the Rossas were the prevailing parties with respect to their breach of contract cause of action; and (4) the Rossas shall recover their costs against Falk in the amount of $45,344, exclusive of attorneys fees and expert witness fees. The trial court reserved the right to determine a reasonable amount of attorneys fees and expert witness fees pursuant to a motion to be filed by the Rossas. [3]

F. The Motion

On July 6, 2006, the Rossas filed a Motion for Attorneys and Expert Fees. The motion was accompanied by a memorandum of points and authorities, and the declarations of two attorneys: Daniel McLennon, the Rossas chief trial attorney, and Richard Pearl, an expert on attorneys fees.

Mr. McLennons declaration was seven pages long, and had five exhibits, two of which, Exhibits D and E, are pertinent here. Exhibit D was three pages long, the first page of which reads in its entirety as follows:

The second page is headed Rossa v. Falk, MLC Fees, and it and page 3 and 4 list 25 invoices, giving the date, the invoice number, and invoice amount. The third page ends with this:

Exhibit D had no backup for the invoicesno time sheets, no description of the services rendered, and no mention of which attorney did them.[4]

Mr. McLennons declaration divided the attorneys fees into four time periods: (1) prior to May 19, 2005, the date of the first mediation: $41,109.50, for 215.8 hours of time; (2) May 19, 2005 to December 9, 2005, the second mediation: $44,225, for 225.9 hours of time; (3) December 9, 2005‑January 30, 2006, the start of trial: $180,991.50, for 826.05 hours of time; and (4) January 30, 2006‑March 9, 2006: $195,098, for 894.23 hours of time.

Exhibit E was a lengthy compilation described as follows in Mr. McLennons declaration: 17. In addition to the above [the claimed attorneys fees], the Rossas incurred significant costs not charged on their cost bill, including those related to expert witnesses, which, pursuant to section 32.6 of the contract are recoverable by them as prevailing parties. These charges total $133,250.66. These amounts are itemized on Exhibit E hereto.

Mr. Pearls declaration is, by contrast, full of detail, the significance of which to the issue here is difficult to discern. Mr. Pearl is, of course, a recognized author and authority, and his work has been cited in many published opinions, including recently by this court. (See Abouab v. City and County of San Francisco (2006) 141 Cal.App.4th 643, 662, 668.) But such expertise is hardly helpful here, as his declaration has essentially two paragraphs tailored to the particular setting. They are Paragraphs 11 and 12. They read as follows:

11. I have been informed and believe that this case involved contract issues, construction defects, delays and failures regarding construction of the Rossas home and that Defendant D.L. Falk Construction, Inc. was their contractor. I am also informed that the litigation surrounding this matter proceeded for approximately 16 months, including a five-week trial, with approximately thirty depositions and several discovery motions.

12. According to what I have been told, Plaintiffs attorneys in this matter charged between $175.00 to $255.00 an hour for their services. This includes billing rates of $225.00 and $255.00 an hour for trial counsel, Mr. McLennon, who has 21 years experience as a commercial litigator, and who has tried eight cases; these rates are at the low end of the range for comparably experienced attorneys. Similarly, these rates are at the low end of charges for an attorney such as Marc Sherman, who also has been a commercial litigator for 21 years.[5]

On August 10, 2006, Falk filed opposition to the motion. The opposition included an 18-page memorandum of points and authorities, asserting five arguments against the motion. The first argument was that the motion must be denied because the Rossas failed to meet the burden of proof necessary to support any fee award. The next four arguments were that the amount sought must be reduced because: (2) the Rossas had limited success; (3) the Rossas did not prevail on the encroachment claim against Falk; (4) the Rossas lost the breach of warranty and negligence causes of action; and (5) there were litigation inefficiencies, over‑complication of the trial, and duplication of effort. The lengthy memorandum cited 23 cases, one statute, and three commentaries, include that of Mr. PearlR. Pearl, California Attorney Fee Awards (Cont.Ed.Bar 2nd ed. 2007), pp. 190-207 (Pearl).

Falks opposition also included the declarations of Jeffrey Leon, Falks trial counsel, and Robert Keenan, of counsel to Mr. Leon, whose declaration might be the longest declaration in the history of California jurisprudence: including the attached exhibits, Mr. Keenans declaration totals over 2000 pages and consumes 8 volumes of the appendix. The exhibits include complete copies of numerous depositions taken in the case, and Mr. Keenans analysis of them, to provide support for Falks fee reduction argument. For example, Mr. Keenan stated that nine of the depositions taken by the Rossas attorneys pertained either wholly or in part to the negligence claim, three of them solely to such claim. Mr. Keenan also stated that of the more than 200 pleadings prepared by the Rossas attorneys, 27 pertained in part to the negligence claim. Mr. Keenan further stated that 20 of the depositions taken by the Rossas attorneys pertained either wholly or in part to the encroachment claim, 11 of them solely to such claim. Finally, Mr. Keenan said that 137 of the pleadings prepared by the Rossas attorneys pertained either wholly or in part to the encroachment claim.

On August 1, 2006, the Rossas filed their reply. It consisted of a six and one-half page memorandum and a three-page declaration of Mr. McLennon. The memorandum does not even mention, much less discuss, many of the 23 cases cited by Falk, and essentially dismisses the cases it does mention, eschewing any analysis. Over half of the reply brief argued that the Rossas had met their burden of proof. The last two and one‑half pages argued that the award should not be reduced from the actual amount they incurred. The Rossas did not object to Mr. Keenans declaration, and at no point did the reply even attempt to take issue with Mr. Keenans claimed description of the depositions.[6]

On August 22, 2006, the Rossas filed a supplemental reply declaration of Mr. McLennon. The declaration was three pages, appended to which were the bills submitted to the Rossas, but completely redacted from which was any description of any of the services provided. This exhibit set forth the date of a service, the initials of the attorney, the rate charged, and the fee.

The motion came on for hearing on August 23, 2006, a hearing that was brief indeed, resulting in a reporters transcript of some eight pages, almost none of which involved discussion of the substantive issues. The court began with the observation that I read the documents you filed, and I see now you have filed some more documents. [] Mr. McLennon does anyone want to say anything that they havent written. Mr. McLennon said, no. Mr. Leon, counsel for Falk, then referred to a supplemental reply declaration, which the court said it had just got. Mr. Leon then objected to that declaration on various grounds, and then said that [with] the caselaw we laid out in our opposition [we] will rest.

The next several minutes at the hearing were directed to discussion of that supplemental declaration, about which Falks counsel was critical, arguing that the information is unhelpful and irrelevant. They didnt provide you with the bills. Apparently agreeing with Falks counsel, the court said, Mr. McLennon, that is a fairly interesting point. . . .[T]here are, well several hundred pages here. [] . . . [] But its nothing, but inked out things. I dont have any idea what these medical [sic] records . . . .

There followed a short discussion about the possibility of the court reviewing unredacted bills in camera, following which this colloquy occurred:

[The Court]: Mr. Leons point is pretty well taken. I see all this redactedwell, what for the record, two inches thick, its full of nothing, except money.

[Mr. McLennon]: Your Honor, those are costs that were actually incurred by the Rossas in defense and prosecution of this action, and those amounts, we submit would not bewould not require any allocation by the Court because all of the costs that were incurred in this case were properly chargeable to Falk because all of the costs incurred in the case were chargeable under causes of action from which Falk was liable, and we had evidence to prove. The fact that we dropped the lot line case before trial did not make it any less applicable to Falk.

[The Court]: Well, I understand thats your position, Mr. McLennon, but, again Mr. Leons point is why you submit all these redacted. This is simplywell, its almost mind boggling. All you had to do was if you are going to do this is say I spent X number of dollars and X number of dollars per hour.

[Mr. McLennon]: We had done that, Your Honor.

[The Court]: I know you have, but why did you do this? Anyway

[Mr. McLennon]: Just because Mr. Falk made the point that we didnt produce any bills. We produced as much of the bills we felt we could under the privilege issue, Your Honor.

Mr. McLennon then stated he could offer further proof, and would be able to provide [the billings] for in camera review. [A]nd so [if] the court desires to see anything from my file or a timeslips file, I am happy to produce that. The court responded: Thank you for your offer. It will stand submitted.

G. The Order

On September 11, 2006, the court issued its order, awarding the Rossas fees and costs as prayed in the sum of $681,390.15the full amount requested. The order is barely over a page in length, and reads in its entirety as follows.

This case deals with a homeowner (plaintiffs) who filed a lawsuit against the contractor (defendant) who built their home pursuant to a written contract. They also named as a defendant the surveyor who improperly surveyed the site; however, that claim was settled on the eve of trial.

The case was vigorously litigated by all parties. At the conclusion of the case the jury awarded plaintiffs damages of $100,000.00. Plaintiffs now claim attorney fees and costs pursuant to the contract totaling $681,390.15. Defendant opposes such an award, and urges the court to apportion plaintiffs attorneys fees between various causes of action in the complaint, and apply the lodestar method of calculating plaintiffs attorneys fees. However, that doctrine should not be utilized where the action deals only with a pecuniary claim, and not a matter dealing with the public interest. Defendant also requests that the court reduce plaintiffs claimed fees and costs because plaintiffs did not recover on all causes of action or the entire amount of damages. claimed. Defendant further requests that the court allocate attorneys fees between the encroachment claim and the other causes of action. The court finds that it would be inappropriate to penalize plaintiffs because their attorney utilized multiple theories of defendants liability to recover damages, but did not recover on each cause of action. Nor is defendant entitled to a credit on the encroachment claim.

Plaintiffs attorneys fees are not based on a contingent fee contract. Plaintiffs are obligated to pay their attorney the fees and costs incurred in the action by virtue of their agreement with their attorney. The contract which is the basis for the jurys award in this case provides that the prevailing party will be entitled to an award of attorney fees, costs and expert witness fees. Although those fees are far greater than the award, defendant is nonetheless obligated to pay them. Therefore, plaintiffs are awarded fees and costs as prayed in the sum of $681,390.15.

H. The Appeal

On November 9, 2006, Falk filed an appeal from the judgment of September 26, 2006 and the order of September 11, 2006. The appeals were given separate numbers in this court, that from the judgment numbered A114677 and that from the attorneys fee order numbered A116151. On September 7, 2007, Falk requested that the appeal in number A114677 be dismissed, which we ordered. Thus, only the attorneys fee issue remains.

II. DISCUSSION

A. The Standard of Review

We have on many occasions set out the standard of review when the issue is the reasonableness of attorneys fees awarded. Thayer v. Wells Fargo Bank (2001) 92 Cal.App.4th 819, 832 is illustrative: Because the sole issue before us is the amount of fees awarded, our review is deferential.  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 wrongmeaning that it abused its discretion.  (PLCM Group v. Drexler (2000) 22 Cal.4th 1084, 1095, quoting Serrano v. Priest (1977) 20 Cal.3d 25, 49 and citing Fed-Mart Corp. v. Pell Enterprises, Inc. (1980) 111 Cal.App.3d 215, 228 [an appellate court will interfere with a determination of reasonable attorney fees only where there has been a manifest abuse of discretion].) As we recently pointed out in a case in which the reasonableness of an attorney fee award was under review,  [t]he scope of discretion always resides in the particular law being applied, i.e., in the legal principles governing the subject of [the] action . . . . Action that transgresses the confines of the applicable principles of law is outside the scope of discretion, and we call such action an abuse of discretion.  (Lealao v. Beneficial California, Inc. (2000) 82 Cal.App.4th 19, 25, quoting City of Sacramento v. Drew (1989) 207 Cal.App.3d 1287, 1297; see also Ramos v. Countrywide Home Loans, Inc. (2000) 82 Cal.App.4th 615, 621-622.) (Accord, In re Vitamin Cases (2003) 110 Cal.App.4th 1041, 1051-1052.)

We have recently elaborated on the concept of abuse of discretion, in People v. Jacobs (2007) 156 Cal.App.4th 728. There, concluding that there was an abuse, we ended our discussion with this observation: In Concord Communities v. City of Concord (2001) 91 Cal.App.4th 1407, 1417 our colleagues in Division Four of this court observed that Abuse of discretion has at lease two components: a factual component . . . and a legal component. [Citation.] This legal component of discretion was best explained long ago in Bailey v. Taaffe (1866) 29 Cal. 422, 424: The discretion intended, however, is not a capricious or arbitrary discretion, but an impartial discretion, guided and controlled in its exercise by fixed legal principles. It is not a mental discretion, to be exercised ex gratia, but a legal discretion, to be exercised in conformity with the spirit of the law and in a manner to subserve and not to impede or defeat the ends of substantial justice. . . . 

All this is well described in Witkin, where, likewise citing the still vital Bailey v. Taaffe, supra, 29 Cal. 422, 424, the author distills the principle as follows: Limits of Legal Discretion. [] The discretion of a trial judge is not a whimsical, uncontrolled power, but a legal discretion, which is subject to the limitations of legal principles governing the subject of its action, and to reversal on appeal where no reasonable basis for the action is shown. (See 5 Am.Jur.2d, Appellate Review  358, pp. 406-407.)  (Jacobs, supra, 156 Cal.4th at p. 737-738.)

Applying those principles here leads to the conclusion that the trial court abused its discretion here, as it did not applyindeed, ignoredthe governing law.

B. The General Principles

Pearl, the Rossas own expert witness, begins his treatise by noting that in the usual situation, in which the court awards an attorney fee as compensation, the goal is to reach a reasonable attorney fee. (Pearl, supra,  1.8, p. 6.) The Rossas do not contend that such is not the goal here, and do not assert any right to receive other than reasonable fees, as their counsel conceded at oral argument.

It has been noted that a party seeking attorneys fees is not necessarily entitled to compensation for the value of attorney services according to [his[ own notion or to the full extent claimed by [him]. (Salton Bay Marina, Inc. v. Imperial Irrigation Dist. (1985) 172 Cal.App.3d 914, 950 [inverse condemnation]; Levy v. Toyota Motor Sales, U.S.A., Inc. (1992) 4 Cal.App.4th 807, 813-814 [Song-Beverly Act].) As Levy went on to note, applying the terms of the statute applicable there, a party seeking fees has the burden of showing the fees incurred were allowable were reasonably necessary to the conduct of the litigation, and were reasonable in amount.  (Levy v. Toyota Motor Sales, U.S.A., Inc., supra, 4 Cal.App.4th at p. 816.)

Not only must the fees awarded be reasonable, Pearl further notes that the amount of fees claimed must be thoroughly and carefully supported. Although the trial court has broad discretion in determining the amount of fees to be awarded (see  15.1), the claiming attorney should be prepared to present evidence on each factor relevant to computation of a fee under the lodestar method: the amount of time spent, including the general subject matter of the time expenditures [citation]; the hourly rates, including the basis for those rates (see 12.33); and every other relevant factor . . . . (Pearl, supra,  14.31, p. 438.)

As noted, Falks opposition vigorously asserted that no fees should be awarded because the Rossas failed to make the requisite showing. The trial court awarded the full amount sought, without one whit of comment about the showing, noting only that the Rossas are obligated to pay their attorney the fees and costs incurred by virtue of their agreement with their attorney.[7]

While Pearl correctly observes that the trial court has wide discretion to determine what might be considered a satisfactory showing, the trial court must nevertheless follow the law in making the award. This, the trial court did not do.

C. The Trial Court Abused Its Discretion

1. The Lodestar

As quoted above, the trial court correctly stated that Falks opposition urged the court to apportion the fees between various causes of action in the complaint, and apply the lodestar method of calculating plaintiffs attorneys fees. The trial court then immediately concluded that the lodestar doctrine should not be utilized where the action deals only with a pecuniary claim, and not a matter dealing with the public interest. The law is contrary.

PLCM Group, Inc. v. Drexler (2000) 22 Cal.4th 1084 (PLCM) is dispositive. PLCM involved a contractual attorneys fee provision, just like here. Affirming the fee there awarded, the Supreme Court held as follow: As the Court of Appeal herein observed, the fee setting inquiry in California ordinarily begins with the lodestar, i.e., the number of hours reasonably expended multiplied by the reasonable hourly rate. California courts have consistently held that a computation of time spent on a case and the reasonable value of that time is fundamental to a determination of an appropriate attorneys fee award. (Margolin v. Regional Planning Com. (1982) 134 Cal.App.3d 999, 1004-1005. (22 Cal.4th at p. 1095.)

Pearl confirms this point, in spades. Pearl has a chapter entitled The Lodestar and Other Methods of Fee Calculation, and begins it with The Primacy of the Lodestar Method. (Pearl, supra, Ch. 11, esp.  11.2) The thrust of the chapter is that, with rare exceptions, the court is to begin with the lodestar computation.[8] Pearl collects numerous cases illustrating the use of the lodestar in non-public interest cases, citing inverse condemnation cases, eminent domain cases, and others. Then, and on point here, Pearl, supra, gives his last example: Contract actions under [Civil Code] 1717. (Pearl, supra,  11.2, p. 291, citing first PLCM.)

Citing nothing, and without explanation, the trial court ruled that the lodestar did not apply. This, we conclude, was an abuse of discretion, especially where Falks opposition contended that there was duplication of effort and wasteful time spent.

Thayer, supra, 92 Cal.App.4th 819 was an appeal contesting the attorneys fees awarded following the settlement of several coordinated class actions. The specific fees contested were those awarded to one attorney, Kassof, under the private attorney general doctrine. (Code. Civ. Proc. 1021.5.) The trial court had awarded Kassof an enhanced lodestar amount, and the settling defendant appealed. We reversed.

We began our discussion by distilling the issue and our holding: Wells Fargo did not below and does not now question the accuracy of Kassofs representations (or those of any other attorney for plaintiffs) as to the number of hours he devoted to the litigation; nor does it challenge the reasonableness of the hourly fee ($300) used by the court in calculating his lodestar. The Banks argument is that the amount of time Kassof spent on the case was unreasonable in the circumstances and unproductive, and that even before it was enhanced by the application of a multiplier, the lodestar calculation produced a manifestly unjustified award. In effect, the Bank claims not only that the factors justifying use of a multiplier to enhance the lodestar figures are wholly missing, but that the unjustified duplication of work that took place requires a negative multiplier decreasing the lodestar. We agree. (Thayer v. Wells Fargo, supra, 92 Cal.App.4th at p. 833, fn. omitted.)

Here it is impossible to discern whether any of the work for which the Rossas sought payment was duplicative, or wasteful, or for some other reason should not have been compensated. Were two counsel at trial duplicative? Or necessary? Were any pretrial motions unnecessary, or unrelated to the claim against Falk? And what about the depositions, analyzed at length by Mr. Keenan. All of these questions were raised by Falks opposition. None of these questions was even mentioned by the trial court, let alone analyzed.

2. Apportionment

Falks opposition below argued that the fees sought should be apportioned, an argument synthesized by the trial court as follows: Falk urges the court to apportion plaintiffs attorneys fees between various causes of action in the complaint . . . . Defendant also requests that the court reduce plaintiffs claimed fees and costs because plaintiffs did not recover on all causes of action or the entire amount of damages claimed. Defendant further requests that the court allocate attorneys fees between the encroachment claim and the other causes of action. Then, and again without meaningful analysis, the court rejected the argument, finding that it would be inappropriate to penalize plaintiffs because their attorney utilized multiple theories of defendants liability to recover damages, but did not recover on each cause of action. Nor is defendant entitled to a credit on the encroachment claim.

As described above, the Rossas complaint alleged five causes of action: one for breach of contract, one for negligence, and three for breaches of warranty. The Rossas dismissed three of the claims, went to the jury on two claims, and succeeded on one, the contract claim. They lost on the negligence claim. The trial court nevertheless gave them all the fees requested, with no analysis. This was error.

Our Supreme Court has held that [w]here a cause of action based on the contract providing for attorneys fees is joined with other causes of action beyond the contract, the prevailing party may recover attorneys fees under section 1717 only as they relate to the contract action. (Reynolds Metals Co. v. Alperson (1979) 25 Cal.3d 125, 129 (Reynolds Metals).)

Here, as the Rossas counsel acknowledged in closing argument, the contract case and the negligence case were different. As he distinguished them: [H]ere is where there is significant difference between the two cases, the negligence and the contract case. The negligence, the Rossas cannot recover for the contract, the money case. Thats just notthats just contract only, and so we are not asking for any damages related to the money case on the negligence cause of action. It would appear, therefore, that in the words of the Supreme Court, the Rossas negligence cause of action was beyond the contract. (Reynolds Metals, supra, at p. 129.)

The contract provision here said that the prevailing party would receive fees for an action to interpret or enforce this contract, or any provision thereof. Such a provision is considered a narrow fee provision. (See Reynolds Metals, supra, 25 Cal.3d at p. 129; Loube v. Loube (1998) 64 Cal.App.4th 421, 429-430.) And such narrow provision precludes recovery for tort claims. (See Gil v. Mansano (2004) 121 Cal.App.4th 739, 743 [where a contract authorizes an award of attorney fees in an action to enforce . . . the contract, tort claims are not covered].[9] The observation of Division Five of this court in Xuereb v. Marcus and Millichap, Inc. (1992) 3 Cal.App.4th 1338 is apt. The contract provision there awarded fees to the party who prevailed on any action to which the agreement gives rise. Such provision, the court concluded, does not limit an award of attorney fees to actions brought on a breach of contract theory, or to actions brought to interpret or enforce a contract. (Id. at pp. 1342-1343; italics added.) The contract provision here does so provide. The caselaw is devastating to the Rossas.

So is Pearl, who has two statements of legal principles pertinent here. The first is in section 6.28: Work on contract claims. When claims based on a contract are combined with tort claims or other claims that are not fee claims, the prevailing party is entitled to fees only for work done on the contract claims (except as provided by the parties agreement; see below) unless the claims for relief are so intertwined that it would be impracticable, if not impossible, to separate the attorneys time into compensable and noncompensable units. [Citations.] The second is in section 12.17: When claims for which fees may be awarded (fee claims) are joined with claims for which fees are unavailable (nonfee claims), the general rule is that compensation may not be awarded for work on the nonfee claims. [Citations.] However, when the attorneys work on the nonfee claim is so closely related to the attorneys work on the nonfee claim is so closely related to work on the fee claim that apportionment is impossible, the courts have awarded fees for the entire case. [Citations.]

The Rossas seek to bring their situation outside the general rule, arguing that the court need not apportion fees for issues that are interrelated, and that the decision of the trial court should be upheld if apportionment is impracticable. Making such argument, the Rossas place heavy reliance on Akins v. Enterprise Rent‑A‑Car Co. (2000) 79 Cal.App.4th 1127, which they cite 11 times. Akins is clearly distinguishable. There, after some discussion of the rules of apportionment, the Court of Appeal concluded as follows: Having concluded that the trial court acted properly as a matter of law when it did not require Akins to formally apportion its hours between claims for which attorney fees were compensable by statute and other hours, we find more generally that the trial court acted properly when making the attorney fees award that it did. . . . In this case, the trial judge who presided over the determination of the various theories of recovery ruled on the motion for attorney fees. The award granted was significantly reduced from the original request as a result of the trial courts indication that it did not look favorably on the full request. Thus, it clearly appears that the trial court exercised its discretion. In these circumstances, we cannot conclude that the award of attorney fees shocks the conscience or suggests that passion and prejudice had a part in it. As such, we conclude that the trial court did not abuse its discretion in awarding the attorney fees that it did. (79 Cal.App.4th at p. 1134.) The case here is a far cry.

The trial court awarded all the fees requested, find[ing] that it would be inappropriate to penalize [the Rossas] because their attorney utilized multiple theories. To begin with, whether a penalty would result is not the issue. What is a reasonable fee is. Moreover, the trial court itself concluded that the Rossas were the prevailing parties with respect to their breach of contract cause of action. But most importantly, what the Rossas counsel utilized were not multiple theoriesthey were multiple claims, four out of five of which were unsuccessful. Sokolow v. County of San Mateo (1989) 213 Cal.App.3d 231 (Sokolow) is compelling.

Sokolow was a sex discrimination case against a county sheriffs department and a male-only private mounted patrol, brought under 42 U.S.C. 1983 and the equal protection clauses of the federal and California constitutions. The trial court found that the significant involvement between the two defendants resulted in state discriminatory action, and issued an injunction ordering the county to sever its relationship with the patrol. However, the court refused the primary injunctive relief requested, which was to compel the mounted patrol to accept women members. As a result of the latter determination, the trial court denied plaintiffs attorney fees under the Civil Rights Attorneys Fees Act (42 U.S.C.  1988) or the private attorney general doctrine, concluding that plaintiffs were not the prevailing parties. Plaintiffs appealed, and the Court of Appeal reversed the denial of attorneys fees, but with a holding adverse to the Rossas here.

The Court of Appeal first noted that the degree or extent of appellants success in obtaining the results which they sought must be taken into consideration in determining the extent of attorney fees which it would be reasonable for them to recover. (Sokolow, supra, 213 Cal.App.3d at p. 248.) The court then noted the distinction between a theory and a claim, and held that while it was within the courts discretion to award all the fees sought when a plaintiff succeeds on a claim, though perhaps some theories were unsuccessful, this was not such a situation. To the contrary: Here, however, appellants may not be said to have obtained all the results they sought. Specifically, appellants were not successful in obtaining admission for women into the Patrol; neither were they successful in entirely eliminating the Countys training and use of the Patrol for search and rescue missions. These were not merely unsuccessful legal theories which were ultimately unnecessary to the success of appellants claims, upon which they entirely prevailed; to the contrary, they were important goals of appellants lawsuit which they failed to obtain. (Id. at p. 250.) Since plaintiffs had been unsuccessful in some of their claims, the court instructed that on remand in arriving at an award of reasonable attorney fees in the instant case, the trial court should take into consideration the limited success achieved by plaintiffs. (Ibid.)

Bell v. Chula Vista Unified School Dist. (2000) 82 Cal.App.4th 672 is also persuasive. Bell was a high school football coach who was terminated following a closed session of the school district and without notice to him. Bell brought an action against the school district and various officials for mandamus and injunctive relief, asserting four Brown Act claims and 11 other claims for tort damages. The trial court issued a temporary restraining order staying Bells termination, and on his mandamus claims ruled that the district had not provided notice required by the Brown Act, so that the action taken at that meeting was null and void. (Gov. Code,  54957.) The court entered judgment in the mandamus action incorporating an award for attorneys fees and costs under the Brown Act, awarding Bell attorneys fees of $147,862. The parties subsequently settled the tort claims.

The Court of Appeal reversed as to the attorneys fees, holding as follows: The trial court thus abused its discretion in failing to apportion the requested fees and costs between those relating to the Brown Act violation and the remaining causes of action for damages. As summarized above, Bell is entitled to reasonable attorney fees and court costs attributable to his action under section 54960.1. However, he is not entitled to such fees and costs incurred as a result of prosecuting his claims for damages, which the parties later resolved by settlement, with Bell receiving $125,000 and a paid leave of absence. (Bell v. Chula Vista Unified School Dist., supra, 82 Cal.4th at p. 689.)

On this point the Rossas argue in their briefthat Falk fails to establish error because [Falk] has not shown that the trial court had before it evidence by which it could apportion. Given who was responsible for such claimed inability to apportion, nothing need be said in response to such argument.

Finally, we note that the Rossas cannot find support in Harman v. City and County of San Francisco (2007) 158 Cal.App.4th 407, the case decided after the briefing was completed and cited by the Rossas shortly before oral argument. It is true that Division One affirmed much of the attorneys fees awarded there, an award the Rossas describe as made by the now-retired Honorable Thomas Mc. Ginn Smith (also the trial judge in the present case). (Respondents Notice of Case Decided Since Briefing, filed June 12, 2008.) But as the Rossas must know, that award came about only after remand, a remand based upon Division Ones conclusion that the trial court did not consider the standards governing the award of attorneys fees under section 1988. (Harman v. City and County of San Francisco (2006) 136 Cal.App.4th 1279, 1316-1317.)[10] Indeed, the second Harman decision, the one on which the Rossas rely, concluded as follows: We do not find that the award at issue here reaches the level of an abuse of discretion. The trial court handled this case for several years, and upon remand engaged in a rigorous and thorough procedure to review the attorney billings. (Harman, supra, 158 Cal.App.4th at p. 428.) That description is hardly applicable here. We fail to see how the complete picture in Harman avails the Rossas.

3. Expert Witness Fees

The contract provided that the prevailing party would be entitled to an award of costs, attorneys fees and expert witness fees. As noted above, the Rossas motion sought $133,250.66 in expert witness fees and costs, a claim supported by the 28-page list of expenses on Exhibit E in Mr. McLennons declaration. Without analysis or discussionindeed, without mentionthe trial court awarded it all. This, too, was error.

Falk argues that such expert witness fees are not recoverable without proof. The Rossas do not take issue with this argument, but content themselves with the argument that Falk waived this contention, in two ways: (1) by not raising it at the trial court level and (2) through its stipulation that the court determine expert witness fees at the attorney fee hearing.

We easily dispose of the Rossas second waiver argument, as the stipulation provided only that the court shall make a determination regarding the reasonable amount of . . . experts fees, if any, to which the Rossas may be entitled. This is hardly a waiver.

The first waiver argument is more problematic, as on this issue in the trial court Falk argued only apportionment, not absence of proof. However, since we are remanding for determination of an appropriate award under the applicable law, we exercise our discretion to address the issue in the light of the undisputed record here. (See Redevelopment Agency v. City of Berkeley (1978) 80 Cal.App.3d 158, 167.) And we hold that, while the contract at issue provides that expert witness fees could be recovered, such fees can be recovered only if they are pleaded and proved as damages at trial, rather than claimed as costs after judgment.

First Nationwide Bank v. Mountain Cascade, Inc. (2000) 77 Cal.App.4th 871 is apt. This was a construction defect case, in which the owner and developer brought a cross-complaint for indemnity against a contractor. The contract provided that the prevailing party would recover all necessary expenses, and the trial court awarded the owner and developer attorneys fees, expert fees, and costs. We reversed the award of attorneys fees and, as pertinent here, the expert fees, holding as follows: [W]e follow Ripley [v.Pappadopoulos, 23 Cal. App. 4th 1616] and conclude that the expert witness fees award in this case were not properly awarded under the necessary expenses portion of the contract because such [s]pecial contract damages are subject to pleading and proof in the main action and cannot be recovered by mere inclusion in a memorandum of costs. [Citations.] (Ripley, supra, 23 Cal.App.4th at p. 1627.) Before judgment, Southampton made no attempt to plead or prove its entitlement to expert witness fees under this contractual theory. (First Nationwide Bank, supra, 77 Cal.4th at p. 878.) And, Justice Haerle concluded, [p]laintiffs proceeding under such a theory must specially plead and prove their right to recover expert witness fees under an appropriate provision of their contract. (Id., at p. 879; accord, Jones v. Union Bank of California (2005) 127 Cal.App.4th 542, 551; Hsu v. Semiconductor Systems, Inc. (2005) 126 Cal.App.4th 1330, 1341 (Hsu); Carwash of America-PO LLC v. Windswept Ventures No. 1, LLC (2002) 97 Cal.App.4th 540, 544.)

4. Costs

It will be recalled that the Rossas filed a memorandum of costs in which they sought $45,344. Falk did not object, and the judgment awarded the costs claimed. The Rossas motion then sought additional costs described in Mr. McLennons declaration as significant costs not charged on their cost bill, apparently in some undisclosed amount, being a portion of the $133,250.66 amount in Exhibit E. These cost items included copying charges, federal express charges, facsimile charges, expenses for summarizing depositions, expenses for an investigator, travel expenses not related to depositions, and miscellaneous other expenses.

Attempting to support the award of costs, the Rossas repeat their waiver argument, which we disposed of ante. The Rossas also briefly attempt to argue the merits, urging that the trial court has wide discretion to award the costs unless specifically prohibited, and also arguing that some of the support services for attorneys are includable within an award of attorneys fees. We disagree.

While it might be appropriate to include some support services and paralegal time as includable within an award of attorneys fees (see City of Oakland v. McCullough (1996) 46 Cal.App.4th 1, 7), many of the claimed expenses cannot be. And to the extent that any such costs were sought pursuant to the contract, recovery of costs provided by contract must be specifically pleaded and proven at trial, and not awarded posttrial as was done here. (Hsu, supra, 126 Cal.App.4th at p. 1330.)

DISPOSITION

The order is reversed to the extent it awarded attorneys fees and expert witness fees in the amount of $681,000, and the matter is remanded for further proceedings consistent with this opinion. Falk is awarded costs on appeal.

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Richman, J.

We concur:

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Kline,