Case Number: KC068830 Hearing Date: March 19, 2018 Dept: J

Re: Carmen Salcido v. Platinum Home Mortgage Corporation, etc., et al. (KC068830)

MOTION FOR ATTORNEY’S FEES

Moving Parties: Defendants Platinum Home Mortgage Corporation, New Ventures, Inc., Sanjesh Sharma and Aracely Sharma

Respondent: Plaintiff Carmen Salcido

POS: Moving OK; Opposing OK; Reply OK

Plaintiff alleges that she has been damaged in the amount of $405,355.63, plus interest and attorney’s fees, due to defendants’ failure to honor an Earnings Withholding Order. The complaint, filed on 10/31/16, asserts causes of action against Defendants Platinum Home Mortgage Corporation (Platinum), New Ventures, Inc. (“NVI”), Sanjesh Sharma (“S. Sharma”), Aracely Sharma (“A. Sharma”) and Does 1-10 for:

Failure to Honor Earnings Withholding Order (v. Platinum only)
Failure to Honor Assignment Order (v. all defendants)
Tortious Acts to Hinder, Deter and Defraud Creditor (v. Platinum and S. Sharma only)
Tortious Acts to Hinder, Deter and Defraud Creditor (v. Platinum and S. Sharma only)

On 11/2/17, the court granted defendants’ motion for summary judgment. On 11/27/17, the judgment was entered. On 12/7/17, plaintiff filed her “Notice of Appeal.”

Defendants Platinum Home Mortgage Corporation, New Ventures, Inc., Sanjesh Sharma (“S. Sharma”) and Aracely Sharma now move, per CCP § 1033.5, Civil Code § 1717 and ¶ 19 of the “Settlement and Mutual Release Agreement” entered into between Plaintiff Carmen Salcido (“plaintiff”) and S. Sharma on/about 8/1/08 (“Settlement Agreement”) in Case No. KC051243 (the “Underlying Action”), for an award of attorney’s fees in the amount of $169,130.00 against plaintiff.

REQUEST FOR JUDICIAL NOTICE:

At the outset, defendants’ request for judicial notice (“RJN”) is ruled on as follows: GRANT as to Exhibit “1” (i.e., “Complaint Objecting to the Dischargeability of Debt Pursuant to 11 U.S.C. § 523” filed 2/16/11 in Case No. 2:10-bk-61901-PC); GRANT as to Exhibit “2” (i.e., “Stipulation for Entry of Judgment” filed 2/16/11 in case styled Salcido v. Sharma Developments, Inc., et al., Case No. KC051243); GRANT as to Exhibit “3” (i.e., Judgment filed 6/6/12 in Case No. 2:10-bk-61901-PC); GRANT as to Exhibit “4” (i.e., “Motion to Amend the 6/6/12 Judgment to Include Attorneys’ Fees and Costs” filed 7/10/12 in Case No. 2:10-bk-61901-PC) and GRANT as to Exhibit “5” (i.e., “Amended Judgment” filed 10/10/12 in Case No. 2:10-bk-61901-PC).

“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, or the parties; but parties to actions or proceedings are entitled to their costs, as hereinafter provided.” CCP § 1021. “The following items are allowable as costs under Section 1032:…Attorney’s fees, when authorized by any of the following: Contract…” CCP § 1033.5(a)(10)(A).

Additionally, “[i]n 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…” Civil Code § 1717(a). “The court, upon notice and motion by a party, shall determine who is the party prevailing on the contract for purposes of this section, whether or not the suit proceeds to final judgment. Except as provided in paragraph (2), the party prevailing on the contract shall be the party who recovered a greater relief in the action on the contract. The court may also determine that there is no party prevailing on the contract for purposes of this section…” Civil Code § 1717(b)(1).

Defendants assert that they are entitled to attorneys’ fees pursuant to ¶ 19 of the Settlement Agreement in the Underlying Action, which reads, in pertinent part, as follows:

“19. Attorneys’ Fees. Except as provided below, it is agreed by the parties that all attorneys’ fees and costs incurred as a result of or in connection to the LAWSUIT, mediation, and settlement shall be borne by the parties who incurred such attorneys’ fees and costs. Should suit be brought to enforce or interpret any part of this Agreement, the ‘prevailing party’ shall be entitled to recover as an element of costs of suit and not as damages, reasonable attorneys’ fees to be fixed by the Court. The ‘prevailing party’ shall be the party entitled to recover his/her/its costs of suit, regardless of whether such suit proceeds to final judgment. A party not entitled to recover his/her/its costs shall not be entitled to recover attorneys’ fees. No sum for attorneys’ fees shall be counted in calculating the amount of a judgment for the purposes of determining if a party is entitled to recover costs or attorneys’ fees.” (S. Sharma Decl., ¶ 3, Exhibit “A”).

On or about 8/7/08, as a result of S. Sharma’s failure to make the required payments under the Settlement Agreement, S. Sharma and plaintiff filed their “Stipulation for Entry of Judgment and Judgment” in the Underlying Action, wherein plaintiff stipulated to a judgment against S. Sharma in the amount of $240,000.00. (RJN, Exhibit “2”). Neither party has attached a conformed copy of same.

Plaintiff claims that the Settlement Agreement has been extinguished by the judgment issued in the Underlying Action, which she represents did not contain an award of attorney’s fees. “’When … a lawsuit on a contractual claim has been reduced to a final, nonappealable judgment, all of the prior contractual rights are merged into and extinguished by the monetary judgment, and thereafter the prevailing party has only those rights as are set forth in the judgment itself. [Citations.] The contract, having merged into the judgment, has no remaining vitality….’ (Chelios v. Kaye (1990) 219 Cal.App.3d 75. 80, superceded on other grounds by a 1992 amendment to Code Civ. Proc., § 685.040).” Munoz v. MacMillan (2011) 195 Cal.App.4th 648, 660.

Defendants, in turn, contend that plaintiff herself invoked ¶ 19 of the Settlement Agreement in July 2012 to obtain attorney’s fees in connection with S. Sharma’s and A. Sharma’s bankruptcy proceedings (i.e., Case No. Case No. 2:10-bk-61901-PC) (the “Bankruptcy Case”). “’”Judicial estoppel sometimes referred to as the doctrine of preclusion of inconsistent positions, prevents a party from ‘asserting a position in a legal proceeding that is contrary to a position previously taken in the same or some earlier proceeding…’”…It is an “’extraordinary remed[y] to be invoked when a party’s inconsistent behavior will otherwise result in a miscarriage of justice.’”’ (Daar & Newman v. VRL International (2005) 129 Cal.App.4th 482, 490-491).” Gottlieb v. Kest (2006) 141 Cal.App.4th 110, 130-131. “In California, courts consider five factors in determining whether to apply judicial estoppel: ‘The doctrine [most appropriately] applies when “(1) the same party has taken two positions; (2) the positions were taken in judicial or quasi-judicial administrative proceedings; (3) the party was successful in asserting the first position (i.e., the tribunal adopted the position or accepted it as true); (4) the two positions are totally inconsistent; and (5) the first position was not taken as a result of ignorance, fraud, or mistake.”’ (Aguilar v. Lerner (2004) 32 Cal.4th 974, 986-987, quoting Jackson [v. County of Los Angeles (1997)] 60 Cal.App.4th [171,] at p. 183; accord, MW Erectors, Inc. v. Niederhauser Ornamental & Metal Works Co., Inc. (2005) 36 Cal.4th 412, 422).” Id. at 131. “Judicial estoppel is an equitable doctrine and its application by the court is discretionary.” Levin v. Ligon (2006) 140 Cal.App.4th 1456, 1468.

The court takes judicial notice of the fact that on 2/16/11, plaintiff filed her “Complaint Objecting to the Dischargeability of Debt Pursuant to 11 U.S.C. § 523” in the Bankruptcy Case. (RJN, Exhibit “1”). This complaint was filed years after the judgment in the Underlying Action was filed. On 6/6/12, judgment was entered in the Bankruptcy Case. (Id., Exhibit “3”). On 7/10/12, plaintiff filed her “Motion to Amend the June 6, 2012 Judgment to Include Attorneys’ Fees and Costs,” wherein she sought $70,586 in attorney’s fees pursuant to ¶ 19 of the Settlement Agreement. (Id., Exhibit “4”). More specifically, plaintiff specifically argued that “[o]n or about August 1, 2008, Defendant Sharma signed a written settlement agreement which provided at paragraph 19 (p. 10) for the provision of attorney’s fees in the event that a suit arouse [sic] from the obligations incurred as described in the Settlement Agreement…Thereafter, Plaintiff initiated the subject lawsuit to recover the same obligation as Defendant had incurred to Plaintiff under the 2008 settlement agreement” (Id., 3:8-14). Plaintiff further argued that “[i]n order to prosecute the instant action to recover on those debts that Plaintiff incurred as part of that 2008 settlement agreement, Plaintiff has incurred attorney’s fees totaling $70,856.” (Id., 3:25-27). Plaintiff then went on to argue that “[u]nder California Civil Code Section 1717, Plaintiff, as the prevailing party, may seek the contractual attorneys’ fees, as the Settlement Agreement provides at Paragraph 19 (page 10). Accordingly, Plaintiff seeks to amend this Court’s Judgment.” (Id., 4:9-12). On 10/10/12, the “Amended Judgment” was filed in the Bankruptcy Case, which included an award of $47,997.50 in attorney’s fees. (Id., ¶ 4).

The court determines that defendants are entitled to seek their attorneys’ fees on the basis of judicial estoppel. The court now addresses the reasonableness of the fees sought. “[T]rial courts have broad discretion in determining the amount of a reasonable attorney’s fee award.” Meister v. Regents of University of California (1998) 67 Cal.App.4th 437, 452. “A trial court’s attorney fee award will not be set aside ‘absent a showing that it is manifestly excessive in the circumstances.’ (Children’s Hospital & Medical Center v. Bonta (2002) 97 Cal.App.4th 740, 782).” Raining Data Corp. v. Barrenechea (2009) 175 Cal.App.4th 1363, 1375.

“The determination of what constitutes a reasonable fee generally ‘begins with the “lodestar,” i.e., the number of hours reasonably expended multiplied by the reasonable hourly rate.’ (PLCM Group, Inc. [(2000)] 22 Cal.4th [1084 ,] at p. 1095). ‘[T]he lodestar is the basic fee for comparable legal services in the community; it may be adjusted by the court based on factors including, as relevant herein, (1) the novelty and difficulty of the questions involved, (2) the skill displayed in presenting them, (3) the extent to which the nature of the litigation precluded other employment by the attorneys, (4) the contingent nature of the fee award. [Citation.] The purpose of such adjustment is to fix a fee at the fair market value for the particular action. In effect, the court determines, retrospectively, whether the litigation involved a contingent risk or required extraordinary legal skill justifying augmentation of the unadorned lodestar in order to approximate the fair market rate for such services.’ (Ketchum v. Moses (2001) 24 Cal.4th 1122, 1132, citing Serrano v. Priest (1977) 20 Cal.3d 25, 49…).” Graciano v. Robinson Ford Sales, Inc. (2006) 144 Cal.App.4th 140, 154.

“In California, an attorney need not submit contemporaneous time records in order to recover attorney fees…[t]estimony of an attorney as to the number of hours worked on a particular case is sufficient evidence to support an award of attorney fees, even in the absence of detailed time records. (Glendora Community Redevelopment Agency v. Demeter (1984) 155 Cal.App.3d 465, 470-471; Margolin v. Regional Planning Com. (1982) 134 Cal.App.3d 999, 1006).” Martino v. Denevi (1996) 182 Cal.App.3d 553, 559.

Defendants’ counsel Jeremy Osher (“Osher”) has attached redacted invoices. (Id., ¶ 9, Exhibit “F”). He has summarized the Lodestar calculation in ¶ 20 of his declaration. This summary provides a breakdown of hours billed and hourly rates of Boren, Osher & Luftman LLP attorneys as follows: (1) Osher: 64.3 hours at $450.00/hour; (2) attorney Aaron Gladstein (“Gladstein”): 328.7 hours at $375/hour; (3) attorney Stephen Z. Boren (“Boren”): 15.4 hours at $450/hour and (4) attorney Mai Suzuki: 20.9 hours at $225.00/hour.[1] Osher has provided scant information relative to the above attorneys’ respective educational and professional backgrounds, stating only that Gladstein “has been a commercial and civil litigator for eight years,” that Boren, “[like [himself],” “is a December 1997 State Bar admittee with “big firm” experience, and that Suzuki is a first-year associate. Osher represents that he will expend an additional 4 hours and that Gladstein will expend an additional 10 hours in connection with this motion.

The court determines that Osher has provided insufficient information substantiating the reasonableness of the above attorneys’ hourly rates and thus reduces Osher’s and Boren’s hourly rates to $375 and Gladstein’s hourly rate to $300.00. Fees are reduced to $133,200.00 on this basis. Fees sought in connection with the preparation of this instant motion are reduced to $4,500.00.

The motion is granted, with total fees reduced to $137,700.00.

[Counsel for defendants is directed to the language at the top
of the tentative rulings that states, “The Tentative Ruling is not an
invitation, nor an opportunity, to file any further documents relative to the
hearing in question which are not authorized by statute or Rule of Court. No such filing will be considered by the
Court in the absence of permission first obtained following ex parte
application therefor. The untimely Declaration of Jeremy J. Osher filed on
3/14/18 is therefore not considered.]

[1] Footnote 3 of the motion advises that “[d]efendants are not seeking to recover the fees billed by associate attorneys Steven Kuehl and Lance Williams as those amounts were nominal in comparison to Messrs. Osher. Gladstein and Boren, and Ms. Suzuki.”