Nine Years’ Litigation, Nobody Prevails

Marina Pac. Partners Homeowners Assoc. v. S. Cal. Fin. Corp., No. B276719 (D2d8 Feb. 5, 2018) 

Civil Code § 1717 permits a prevailing party to a contract with an attorney fee provision to recover its fees. The trial court is authorized to determine the prevailing party, who is generally the party that receives the greater of the relief. But the code authorizes the court to decide that there isn’t any prevailing party and, under those circumstances, to decline to shift fees. The Supreme Court has instructed that in making a prevailing party determination, the court should look at the relief obtained in the context of the parties’ litigation objectives. Hsu v. Abbara, 9 Cal. 4th 863 (1995). If the case is truly a mixed bag—like where both parties seek relief and neither gets everything it wanted—then the trial court can find there’s no prevailing party.

This is a long running real estate dispute, filed in 2009. I don’t really care to get into the substance, but the dispute is over a fee. Plaintiff wanted to be entirely absolved from paying it. Defendant asserted that it should be 10 percent over the life of the contract. The judgement landed on 4 percent. Now, both sides try to say that the 4 percent was their true objective and thus that they prevailed. (Because you litigate for 9 years when you basically agree, right?) But that really wasn’t what the case was about. Under the circumstances the trial court didn’t abuse its discretion that no party prevailed to the extent that a fee award was merited. Same goes with the court’s declining to award costs under Code of Civil Procedure § 1032.

Affirmed.