Case Number: 17K00094 Hearing Date: May 31, 2018 Dept: 94

Plaintiff Faramarz I. Mashian dba ICTS’s Motion for Attorneys’ Fees is DENIED.

Background

On January 4, 2017, Plaintiff Faramarz I. Mashian dba ICTS (“Plaintiff”) filed a complaint against Defendants Kelly Kang dba Aloha Deli Market; Jonathan Kang; Keung Ri Hahn (“Defendant”); and Does 1 through 20 for breach of written contract. On April 3, 2017, Defendant filed a cross-complaint against Plaintiff. Defendants Jonathan Kang and Kelly Kang filed a cross-complaint against Defendant on May 12, 2017. On June 16, 2017, Defendant filed a cross-complaint against Defendants Kelly Kang and Jonathan Kang.

On November 1, 2017, Plaintiff filed a motion for summary adjudication against Defendant. On January 16, 2018, the Court took the matter under submission after hearing oral argument. On January 22, 2018, the Court granted the MSA. Judgment was entered for Plaintiff and against Defendant on the same day. Defendant filed a notice of appeal on February 26, 2018.

Plaintiff filed the instant motion on May 3, 2018. Defendant filed an opposition on May 17, 2018. Plaintiff filed a reply on May 23, 2018.

Legal Standard

A prevailing party in entitled to recover costs, including attorneys’ fees, as a matter of right. (See Code Civ. Proc., §§ 1032(a)(4), 1032(b), 1033.5.) In a breach of contract action, attorneys’ fees shall be awarded when a contract provides that one of the parties or the prevailing party shall be awarded attorneys’ fees in an action on that contract. (See Civ. Code, §1717.)

The fee setting inquiry in California ordinarily begins with the “lodestar” method, i.e., the number of hours reasonably expended multiplied by the reasonable hourly rate. 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. The lodestar figure may then be adjusted, based on consideration of factors specific to the case, in order to fix the fee at the fair market value for the legal services provided. (Serrano v. Priest (1977) 20 Cal.3d 25, 49.) Such an approach anchors the trial court’s analysis to an objective determination of the value of the attorney’s services, ensuring that the amount awarded is not arbitrary. (Id. at 48, n.23.) After the trial court has performed the lodestar calculations, it shall consider whether the total award so calculated under all of the circumstances of the case is more than a reasonable amount and, if so, shall reduce the section 1717 award so that it is a reasonable figure. (PLCM Group v. Drexler (2000) 22 Cal.4th 1084, 1095-96.)

The factors considered in determining the modification of the lodestar include the nature and difficulty of the litigation, the amount of money involved, the skill required and employed to handle the case, the attention given, the success or failure, and other circumstances in the case. (EnPalm, LLC v. Teitler Family Trust (2008) 162 Cal. App. 4th 770, 774 (emphasis in original).) A negative modifier was appropriate when duplicative work had been performed. (Thayer v. Wells Fargo Bank, N.A. (2001) 92 Cal.App.4th 819.)

Discussion

Plaintiff moves for attorneys’ fees in the amount of $4,635.00 as the prevailing party in the case.

Timeliness

Defendant Hahn asserts this motion is untimely. The Court agrees.

CRC rule 3.1702 provides that “[a] notice of motion to claim attorney’s fees for services up to and including the rendition of judgment in the trial court—including attorney’s fees on an appeal before the rendition of judgment in the trial court—must be served and filed within the time for filing a notice of appeal under rules 8.104 and 8.108 in an unlimited civil case or under rules 8.822 and 8.823 in a limited civil case.” (Cal. Rules of Court, rule 3.1702(b)(1).)

CRC rule 8.822 provides the following, in relevant part:

(1) Unless a statute or rule 8.823 provides otherwise, a notice of appeal must be filed on or before the earliest of:

(A) 30 days after the trial court clerk serves the party filing the notice of appeal a document entitled “Notice of Entry” of judgment or a filed-endorsed copy of the judgment, showing the date it was served;

(B) 30 days after the party filing the notice of appeal serves or is served by a party with a document entitled “Notice of Entry” of judgment or a filed-endorsed copy of the judgment, accompanied by proof of service; or

(C) 90 days after the entry of judgment.

(Id., rule 8.822(a)(1).)

CRC rule 8.823 provides for situations where the time to appeal is extended, such as where a motion for new trial or motion to vacate judgment is filed. (Id., rule 8.823.)

Judgment was entered on January 22, 2018. The notice of entry of judgment was served by the clerk on January 26, 2018. Plaintiff served a notice of entry of judgment on February 21, 2018. Pursuant to CRC rule 8.822, the deadline for filing the motion is February 26, 2018, given this is the earliest deadline amongst February 26, 2018 (30 days after clerk’s service of the notice of entry of judgment), March 23, 2018 (30 days after service of the notice of entry of judgment on Defendant), and April 23, 2018 (90 days after entry of judgment). Plaintiff did not file the instant motion until May 3, 2018. As such, Plaintiff’s motion is untimely.

Plaintiff asserts this untimeliness was due to mistake, inadvertence and/or excusable neglect by Plaintiff’s counsel’s office. Mistake, inadvertence, and/or excusable neglect is not grounds for extending the time to file this motion.

The time for filing this motion can be extended for good cause. (See Cal. Rules of Court, rule 3.1702(d).) However, Plaintiff has failed to show good cause for extending the time to file this motion. Plaintiff’s counsel’s staff member, Meagan Thompson-Mann, who is responsible for calendaring all litigation deadlines, failed to calendar the deadline to file the motion while she was out of office for over six weeks to assist in trial in Ventura. (See Mashian Decl., ¶¶ 2-4; Thompson-Mann Decl., ¶¶ 2-5.) While Ms. Thompson-Mann declares that she notified Plaintiff’s counsel as soon as she became aware of this mistake, there are no indications of when this occurred. (See Thompson-Mann Decl., ¶ 6.) The only referenced date is May 3, 2018, which is when this motion was filed and served. (See id.) Defendant’s evidence demonstrates that Plaintiff’s counsel was aware of the potential issue of timeliness by March 15, 2018. (See Park Decl., ¶ 3, Ex. B.) Plaintiff’s counsel even indicated that they would bring a motion immediately if the parties were unable to settle. (See id.) This motion was not filed until May 3, 2018. Plaintiff fails to provide an explanation as to the delay between the filing of this motion and knowledge of the issues with timeliness. Without an explanation of the delay, the Court cannot find good cause for extending Plaintiff’s time to filing this motion.

Merits

Even if there was good cause for extending Plaintiff’s time for filing this motion, Plaintiff’s motion would still be denied on the merits.

CCP section 1033.5 provides that attorney’s fees may be recoverable when authorized by contract, statute, or law. (See Code Civ. Proc., § 1033.5(a)(10).) Section 1033.5 further provides that attorney’s fees awarded pursuant to Civil Code section 1717 are allowable costs under CCP section 1032.) (See id., § 1033.5(c)(5)(B).) Civil Code section 1717 provides that in a breach of contract action, attorneys’ fees shall be awarded to the prevailing party where the contract specifically provides for attorney’s fees to one of the parties or to the prevailing party. (See Civ. Code, § 1717.)

Notwithstanding the pending appeal, it is undisputed that Plaintiff is the prevailing party. However, the agreement does not provide for the award of attorneys’ fees in this case. Paragraph 7 of the agreement provides the following:

Any claim, dispute, lawsuit, action or preceding [sic] between the parties hereto, or arising out of or relating to this agreement shall be settled by binding arbitration pursuant to the rules set forth for commercial arbitration of the American Arbitration Association (AAA), such arbitration to be held in the office of the AAA located closest to Los Angeles, California, with prevailing party recovering not only its general and special damages, but punitive damages as is appropriate, as well as reasonable attorney’s fees. Any claim under five thousand dollars ($5,000) claimant has the option of filling [sic] in the small claim court of California instead of using the AAA.

(Mashian Decl., ¶ 3, Ex. 1, p. 2.)

Based on this language, attorney’s fees are only recoverable by the prevailing party in arbitration. Given this matter was not decided in arbitration, Plaintiff is not entitled to attorneys’ fees pursuant to the agreement.

Plaintiff asserts Defendant waived arbitration by participating in this action. This is irrelevant. Even if Defendant waived arbitration, this does not mean Plaintiff is entitled to attorneys’ fees pursuant to paragraph 7 of the agreement. Plaintiff cites to Kahn v. Chetcuti (2002) 101 Cal.App.4th 61 for the contention that the trial court or arbitrator has discretion to award attorneys’ fees to the prevailing party when the process for resolving disputes is waived by a party. However, the agreement at issue in Kahn specifically allowed the prevailing party in any arbitration or other legal proceeding to recover reasonable attorneys’ fees. (See id. at 63.) As discussed, the attorneys’ fee provision here only allows recovery in arbitration.

Plaintiff also asserts that the Court is empowered to read paragraph 7 to include attorney’s fees for resolution of disputes through litigation. Plaintiff’s assertion is unavailing. Plaintiff relies on Ajida Technologies, Inc. v. Roos Instruments, Inc. (2001) 87 Cal.App.4th 534 to support his assertion. While the Court of Appeal in Ajida Technologies, Inc. recognized that “a contract provision that permits the recovery of fees in arbitration is broad enough to include fees in related judicial proceedings,” this was with respect to an appeal from the judgment confirming an arbitration award. (See Ajida Technologies, Inc., supra, 87 Cal.App.4th at 552.) The cases discussing broad interpretation of attorney’s fees provisions cited by the Ajida Technologies Court also dealt with confirmation of arbitration awards. (See id.) Based on this, attorney’s fees would be recoverable if the judicial proceeding is related to arbitration. The instant action is not related to arbitration and Plaintiff has failed to otherwise show that it is a “related judicial proceeding.” Paragraph 7 thus cannot be broadly interpreted to award reasonable attorney’s fees to Plaintiff.

Based on the foregoing, Plaintiff’s motion for attorneys’ fees is denied.

Moving party to give notice.