Burkhalter Kessler Clement & George LLP v. Hamilton, No. G054337 (D4d3 Jan. 8, 2018)
P sues D for breach of contract. P also sues AE on the same contract, on the theory that AE is D’s alter ego. The P/D contract has an attorney’s fee clause. P wins as to D on breach, but fails to prove that AE is D’s alter ego.
Q: Who recovers fees?
A: P gets them against D, but AE gets them against P.
One of the upshots of Civil Code § 1717 is that if you try to enforce a contract with a fee provision in it against a nonparty (like an alleged alter ego) that party gets fees under the contract if it wins. That’s the case even if plaintiff wins on liability against the principal defendant, but fails to prove the nonparty is bound. Nothing in § 1717 prevents there from being two different prevailing parties on a claim by claim basis.
Reversed.
No comments:
Post a Comment