United States District Court, N.D. California, San Francisco Division
ORDER DENYING THE DEFENDANT'S MOTION FOR
ATTORNEY'S FEES. RE: ECF NO. 52
BEELER United States Magistrate Judge.
case arises from an attorney-client relationship gone wrong.
The court previously compelled arbitration of client Shaunak
Sayta's claims against attorney Benny Martin and
confirmed a prior, fees-based arbitration award in favor of
Mr. Martin. The court assumes familiarity with the
case and incorporates by reference the statement of facts in
its prior order.
Martin, an attorney proceeding pro se in this
litigation, now moves to collect attorney's fees
“measured by the loss of income that he suffered as a
result of” litigating the case. He seeks to recover those
“fees” on three grounds: (1) under the
parties' agreement for attorney's fees in the event
of a dispute (as authorized by California Civil Code section
1717); (2) as sanctions under 28 U.S.C. § 1927; and (3)
as sanctions under the court's inherent
court can decide this matter without oral argument and
vacates the hearing on April 13, 2017. Civil. L.R. 7-1(b).
The court denies Mr. Martin's motion because he is not
entitled to recover his opportunity costs and the court
declines to impose those losses as a sanction on Mr. Sayta.
Mr. Martin Is Not Entitled to Attorney's Fees Under Civil
Code Section 1717
Martin's first claim for attorney's fees arises under
the parties' contract and California Civil Code section
1717. Section 1717(a) provides for the recovery
of reasonable attorney's fees and costs to the prevailing
party in a contract action:
In 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.
Cal. Civ. Code § 1717(a); Lucasfilm, Ltd. v. Canal
Toys, No. C 11-01639 WHA, 2012 WL 685415, at *3 (N.D.
Cal. Mar. 2, 2012).
indeed, the parties' attorney-client fee agreement
contains two fee provisions. First, it says, “[i]n the
event it becomes necessary to institute an action at law to
enforce this agreement or any part thereof, including
recovery of fees and/or costs and expenses, the prevailing
party in that action shall be entitled to recover reasonable
attorney'[s] fees.” Second, the agreement provides,
the parties must arbitrate “any dispute with respect to
this agreement, ” and that “[t]he prevailing
party shall be entitled to recover reasonable attorney's
fees, [whether] pro se or otherwise, in said
[arbitration].” Thus, Mr. Martin asserts, because there
“can be no doubt that [he] was the prevailing party in
this action, ” and because the contract provides for
his recovery of attorney's fees, he is entitled to those
fees under section 1717.
Martin identifies the “twist” here: the parties
are both attorneys that represented themselves pro
se. Mr. Martin asserts that “[n]o case
law prohibits the parties' bargain” and that
“there is no public policy conceivable for preventing a
litigator that hires another litigator from agreeing to pay
the other's reasonable fees.”
The California Supreme Court has held “that an attorney
who chooses to litigate in propria persona and therefore does
not pay or become liable to pay consideration in exchange for
legal representation cannot recover ‘reasonable
attorney's fees' under Civil Code section
1717.” Trope v. Katz, 11 Cal.4th 274, 292
(1995). The Trope Court “based its decision
solely on the statutory interpretation of section 1717, and
specifically on what it means to ‘incur'
attorneys' fees.” Farmers Ins. Exch. v. Law
Offices of Conrado Joe Sayas, Jr., 250 F.3d 1234, 1237
(9th Cir. 2001) (discussing Trope).
Trope, “section 1717 applies only to contracts
specifically providing that attorney['s] fees
‘which are incurred to enforce that
contract' shall be awarded to one of the parties or to
the prevailing party.” Trope, 11 Cal.4th at
280 (emphasis in original). “To ‘incur' a
fee, of course, is to ‘become liable, '” and
so a pro se attorney “cannot be said to
‘incur' compensation for his time and his lost
business opportunities.” Id. And section 1717
applies only to “fees” -“the consideration
that a litigant actually pays or becomes liable to pay in
exchange for legal representation.” Id. In
other words, an attorney proceeding pro se does not
“incur” - or, does not actually pay or become
liable to pay - “fees” measured by time spent and
opportunities lost. Id. at 283; see
Farmers, 250 F.3d at 1237 (“[T]he key to the
analysis of section 1717 under Trope is the
incurring of fees.”) (emphasis in original);
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