2018-00235493-CU-BT

Pete De la Vega vs. Golden Bear Insurance Company

Nature of Proceeding: Motion to Tax Costs

Filed By: Peterson, Nicholas J.

If oral argument is requested, the matter will be heard at 2:00 p.m. in this department on Tuesday, January 22, 2019. If this date is not convenient, the parties shall meet and confer and contact the court clerk with a new date by 4:00

p.m. on Thursday, January 17, 2019.

Plaintiff Ariz de la Vega moves to tax costs claimed by Defendant Golden Bear Insurance Company (“Defendant” or “Golden Bear”). The motion is granted in part and denied in part, as follows.

Defendant’s request for judicial notice of the complaint, cross-complaint, and Plaintiff Ariz de la Vega’s notice of request for dismissal is granted.

Background

Plaintiffs Pete and Ariz de la Vega filed a complaint against Golden Bear, their residential property insurer, on June 21, 2018. The complaint alleged one cause of action for breach of the covenant of good faith and fair dealing related to Golden Bear’s handling of two separate losses claimed in January 2017.

On August 10, 2018, Golden Bear filed a cross-complaint alleging fraud against the de la Vegas and seeking rescission of the insurance policy. On August 16, 2018, Golden Bear amended its cross-complaint to seek termination of the policy based on the fraud allegations rather than rescission.

On September 20, 2018, Golden Bear filed a stipulation to file a second amended cross-complaint, which was entered as an order on September 24, 2018. However, before filing a second amended cross-complaint, Golden Bear dismissed the first amended cross-complaint against both Plaintiffs on September 27, 2018.

On November 5, 2018, Plaintiff Ariz de la Vega filed a request for dismissal without prejudice as to herself alone. Plaintiff Pete de la Vega remains in the litigation prosecuting the same causes of action. On November 15, 2018, Plaintiffs filed a notice of entry of dismissal of Plaintiff Ariz de la Vega.

On November 30, 2018, Golden Bear filed a memorandum of costs seeking $2,925.40 in costs in the following categories: (1) $680.50 in filing and motion fees; (2) $1,955.70 in deposition costs; (3) $210 in service of process costs; (4) and $79.20 in witness fees.

Plaintiff Ariz de la Vega then filed the instant motion to tax Golden Bear’s costs, alleging the costs should be taxed “to ensure costs sought are only those recoverable under the statute, and then fairly apportion the remaining costs between the dismissed plaintiff, Ariz de la Vega, and the plaintiff still remaining, her husband, Pete de la Vega, so as not to allow Golden Bear a windfall at this early stage in the litigation.” (Mot. at 1.)

Legal Standard

Prevailing parties are “entitled as a matter of right to recover costs in any action or proceeding.” (Code Civ. Proc. § 1032(b).) Code of Civil Procedure section 1033.5(a) identifies cost items that are allowable under section 1032. Section 1033.5(b) identifies items that are not allowable. Section 1033.5(c) provides, inter alia, that “(2) Allowable costs shall be reasonably necessary to the conduct of the litigation rather than merely convenient or beneficial to its preparation” and “(3) Allowable costs shall be reasonable in amount.” (Id. § 1033.5(c)(2), (3).) It then provides “[i]tems not mentioned

in this section . . . may be allowed or denied in the court’s discretion.” (Id. § 1033.5(c)

(4).)

On a motion to tax costs, the burden of proof shifts between the parties. If the items appear to be proper, the verified memorandum is prima facie evidence that the costs, expenses, and services claimed were necessarily incurred. (Nelson v. Anderson

(1999) 72 Cal.App.4th 111, 131; Foothill-De Anza Community College Dist. v. Emerich

(2007) 158 Cal.App.4th 11, 29.) If the items in the cost bill appear to be proper and reasonable, the burden then shifts to the party seeking to tax costs to show the claimed costs were not reasonable or necessary. (Ladas v. California State Automobile Ass’n (1993) 19 Cal.App.4th 761, 774.) Costs must be reasonable in amount and reasonably necessary to the litigation. (Code Civ. Proc. § 1033.5(c)(2),

(3).) Costs merely convenient or beneficial to its preparation are not permitted. (Id. § 1033.5(c)(2); Nelson, 72 Cal.App.4th at 129.) Supporting documentation for costs claimed must be submitted if costs have been put in issue by a motion to tax costs. ( Jones v. Dumrichob (1998) 63 Cal.App.4th 1258, 1267.) If the items appear improper, unreasonable, or unnecessary and they are properly objected to, the burden of proof is on the party claiming the expense. (Nelson, 72 Cal.App.4th at 131; Foothill-De Anza, 158 Cal.App.4th at 29.)

However, Courts have held that “conclusory challenge[s]” to the reasonableness of costs are insufficient to shift the burden to the party seeking to recover the costs. (See, e.g., Jones, 63 Cal.App.4th at 1266-1267; Nelson, 72 Cal.App.4th at 131.) “[M]ere statements in the points and authorities accompanying its notice of motion to strike cost bill and the declaration of its counsel are insufficient to rebut the prima facie showing [that costs were necessarily incurred].” (Jones, 63 Cal.App.4th at 1266-1267.)

Analysis

Golden Bear filed a memorandum of costs seeking $2,925.40 in costs in the following categories: (1) $680.50 in filing and motion fees; (2) $1,955.70 in deposition costs; (3) $210 in service of process costs; (4) and $79.20 in witness fees.

Plaintiff Ariz de la Vega seeks to tax the costs, arguing they would have been incurred even if Plaintiff Pete de la Vega had filed the litigation without her named as a plaintiff. As such, Plaintiff argues the costs should be apportioned. Golden Bear argues in opposition that there is no basis for apportioning the costs as Plaintiff Ariz de la Vega dismissed her complaint against Golden Bear, in Golden Bear’s favor. On reply, Plaintiff contends that the costs would have been incurred even if Plaintiff Ariz de la Vega had never been named as a plaintiff and Plaintiff Pete de la Vega had filed the lawsuit on his own.

Plaintiff also raises some challenges to specific costs claimed, which are addressed in their specific categories below.

Filing and Motion Fees

Filing and motion fees are allowed expenses under section 1033.5(a)(1).

In its memorandum of costs, Golden Bear seeks $680.50 for the following: (1) $528.50 for answer and summons/cross-complaint; (2) $50 for amended cross-complaint; (3) $52 for stipulation to file amended cross-complaint; and (4) $50 for dismissal of cross-

complaint.

Plaintiff challenges each of the costs, claiming they seek costs related to Golden Bear’s cross-complaint, which it dismissed. Plaintiff also challenges any costs for electronic filing fees charged by a third-party service because they were not ordered by the court to be filed electronically.

In opposition, Golden Bear reduces its claimed costs to $435 for the costs it incurred in filing its first paper with the court (answer and cross-complaint). It withdraws its request for the additional $245 reflecting fees charged by the process service company used by Golden Bear and inadvertently included in the memorandum. Golden Bear claims it should be awarded the entire $435 because it had to file its answer before it would have been able to file its cross-complaint and that Defendant would have incurred the cost in full even if Plaintiff Ariz de la Vega had been the only plaintiff. Accordingly, Golden Bear claims the $435 should not be apportioned.

On reply, Plaintiff argues that it is reasonable to split the filing fee in half since Golden Bear had filed its answer, which is recoverable, and its cross-complaint, which is not recoverable. Plaintiff argues that amount should then be split in half again, since Pete de le Vega remains in the litigation. Accordingly, Plaintiff argues that, at most, Golden Bear should be awarded $108.75.

The Court acknowledges that an “across the board” apportionment without analysis of the reasonableness of the costs incurred has been rejected by courts. (See Nelson v. Anderson (1999) 72 Cal.App.4th 111, 117.) In Nelson, however, the trial court reduced the pre-trial costs claimed by two-thirds on the basis that the defendant had previously settled with two of the three plaintiffs prior to trial. (Id.) The Court of Appeal reversed the trial court because “an across-the-board reduction based upon the number of plaintiffs, without regard to the reason the costs were incurred, is not a determination of the necessity or reasonableness of the costs.” (Id.)

Here, the Court acknowledges the validity of the argument of both sides. As a preliminary matter, the Court does not apportion on the basis that the cross-complaint was filed at the same time as the answer. However, the Court does apportion on the basis that the sole cause of action alleged by both plaintiffs still remains even though Ariz de la Vega has dismissed herself as a plaintiff. For all intents and purposes, the scope of the litigation remains unchanged following her dismissal. Since Plaintiff asked that the filing fee be reduced to half on the basis that Plaintiff Pete de la Vega remains in the litigation, the Court will honor that request.

As such, the cost awarded for filing and motion fees is reduced to $217.50.

Deposition Costs

The cost of traveling to and from, taking, videotaping, and transcribing necessary depositions is allowed under section 1033.5(a)(3).

Golden Bear seeks $1,955.70 in deposition costs as follows: (1) $313.15 for the

deposition of Pete de la Vega ($275 for transcription and $38.15 for travel); (2)
$313.15 for Ariz de la Vega ($275 for transcription and $38.15 for travel); (3) $665.20

for David Hernandez ($578 for transcription and $87.20 for travel); and (4) $664.20
($577 for transcription and $87.20 for travel).

Ariz and Pete de la Vega Depositions

Plaintiff argues that the costs for the depositions of Pete and Ariz de la Vega were unnecessary because both depositions were taken after Golden Bear’s counsel was informated that the parties could not attend on the noticed dates. Golden Bear’s counsel proceeded anyway to take notices of non-appearance. Plaintiff argues the unreasonableness of the costs is further demonstrated by the fact that Golden Bear has since taken the depositions of both Plaintiffs after the parties identified a mutually convenient date. Alternatively, Plaintiff contends that the amount should be reduced by half because the costs would have been incurred even if Plaintiff Ariz de la Vega has not been in the litigation and it was just Plaintiff Pete de la Vega.

In opposition, Golden Bear argues the depositions were necessary because Plaintiffs served Golden Bear with a 998 offer on September 7, 2018. The depositions had been noticed on August 17, 2018, for September 19 and September 21, 2018. On September 11, 2018, Plaintiffs’ counsel informed Golden Bear’s counsel that he was not available for Plaintiffs’ noticed depositions, but failed to provide future availability and failed to timely serve objections to the deposition notices. The notices of non-appearance were then taken. Golden Bear alleges the depositions were necessary to evaluate the reasonableness of the 998 offer. Golden Bear argues that both depositions would have been taken if only Ariz de la Vega had been the plaintiff, as both plaintiffs are owners of the subject property at issue in the litigation. As such, Golden Bear argues the costs should not be apportioned.

On reply, Plaintiff argues that Defendant does not explain why it was necessary to go to the trouble and cost of taking statements of non-appearance when defense counsel knew Plaintiffs were not available for the depositions. Further, Golden Bear did not ask for a stipulation to extend the time for Golden Bear to respond to the 998 offer. Plaintiff argues that no costs should be awarded and, alternatively, the costs should be apportioned to 50% or less “since the primary plaintiff remains to continue the prosecution of their unified cause of action against Golden Bear.”

The Court agrees with Plaintiff. The fact that Ariz and Pete de la Vega were both later deposed in December 2018, after Ariz de la Vega filed her notice of dismissal, belies the point that the depositions would have occurred even if Pete de la Vega had been the only named plaintiff. Further, Golden Bear was aware that Plaintiffs would not be produced on the dates scheduled.

Accordingly, the Court taxes the $626.30 claimed for the notices of non-appearance taken at the depositions of Ariz and Pete de la Vega in September 2018.

David Hernandez and Clayton Rodrigues

Plaintiff argues these costs should be reduced by half because one of the two plaintiffs remains in the action.

In opposition, Golden Bear argues that the deposition of David Hernandez, the owner and person most knowledgeable of DC Floors, was necessary to its defense. Mr. Hernandez prepared an estimate for the replacement of laminate flooring at the subject property, and his testimony was relevant surrounding the alleged damage to the flooring of the subject property. Golden Bear deposed Clayton Rodrigues, owner

and person most knowledgeable of Zothex Flooring, because Mr. Rodriguez prepared bids for inspection and replacement of laminate flooring at the subject property. Both depositions occurred before Ariz de la Vega filed her notice of dismissal. Golden Bear contends that Plaintiff’s sole argument is that the costs should be apportioned since Pete de la Vega remains in the litigation. Golden Bear objects to the argument on the basis that Golden Bear would have incurred these costs even if Ariz de la Vega had been the only plaintiff in this action.

On reply, Plaintiff argues that Golden Bear is only reasonably entitled to half of the costs because Pete de la Vega remains in the lawsuit related to Plaintiffs’ joint sole cause of action.

The Court taxes half of the claimed costs for these depositions, per Plaintiff’s claim in the motion to tax. The Court again reiterates that this is not an “across-the-board” reduction being made, but that this is the most equitable and in line with the moving papers (which did not request a total reduction).

Accordingly, the Court reduces the deposition costs to $664.70.

Service of Process Costs

Service of process costs are recoverable under section 1033.5(a)(4).

Golden Bear seeks $210 for the following registered process costs: (1) $20 for Zothex Flooring; (2) $30 for David DeTinne; (3) $30 for Clayton Rodriguez; (4) $30 for DC Floors; (5) $20 for David Hernandez; (6) $30 for Zothex Flooring; (7) $20 for Clayton Rodrigues; and (8) $30 for David Hernandez.

Plaintiff challenges the costs claimed, as three of the charges (Zothex Flooring (for $30

and $20), Clayton Rodrigues (for $30 and $20), and David Hernandez (for $30 and
$20) appear to be duplicative. Further, Plaintiff alleges that Golden Bear is only entitled
to half of the costs because one-half is attributable to the remaining Plaintiff.

In opposition, Golden Bear explains and attaches evidence demonstrating that the charges were not duplicative but that service had to be attempted twice on those three deposition subpoenas. Golden Bear also argues that it would have incurred these costs even if Ariz de la Vega was the only plaintiff, so the costs should not be apportioned.

On reply, Plaintiff acknowledges Golden Bear’s explanation of the charges that appeared to be duplicative, but maintains her argument that “to avoid a windfall to Golden Bear,” it is only entitled to half of the amounts sought.

The Court awards half the costs claimed, and taxes half. As such, Golden Bear is awarded $105 in service of process costs. Again, this is not an “across-the-board” reduction. Had Plaintiff’s moving papers moved to tax the entirety of the service of process costs, the Court may have considered such a request. Golden Bear concedes that it would have incurred these costs whether both or just one of the plaintiffs was involved in this litigation.

Witness Fees

Golden Bear claims $79.20 for the following witness fees: (1) $38.20 for David Hernandez ($35 for daily fee and 16 miles at $.20/mile); and (2) $41 for Clayton Rodrigues ($35 for daily fee and 30 miles at $.20/mile).

The parties make the same arguments related to the claimed witness fees as related to the services of process costs. For the same reasons, the Court awards half the costs claimed, totaling $39.60, and taxes the remainder.

Conclusion

The Court awards $217.50 for filing and motion fees; $664.70 in deposition costs;

$105 in service of process costs; and $39.60 in witness fees, for a total of $1,026.80.

Defendant Golden Bear shall prepare a formal order for the Court’s signature pursuant to C.R.C. 3.1312.