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Orien v. Lutz

California Court of Appeals, Second District, Eighth Division

November 3, 2017

STARA ORIEN, Plaintiff and Respondent,
v.
MISTA L. LUTZ et al., Defendants and Appellants.

         APPEAL from an order of the Superior Court of Los Angeles County No. BC524339, Deirdre H. Hill, Judge. Reversed.

          Friedman Stroffe & Gerard and Richard W. Millar for Defendants and Appellants.

          Schorr Law and Zachary D. Schorr for Plaintiff and Respondent.

          FLIER, J.

         Defendants Mista L. Lutz and Russell A. Howells appeal from an order granting attorney fees to plaintiff Stara Orien, respondent here, after the trial court entered an interlocutory judgment of partition in her favor. The trial court found that an attorney fee provision in an earlier settlement agreement among the parties applied to the partition action, and thus awarded all fees to plaintiff under Civil Code section 1717 rather than apportioning the costs of partition under Code of Civil Procedure section 874.040. We hold that the partition action did not fall within the terms of the attorney fee provision. Accordingly, we reverse the order.

         BACKGROUND

         In 2003 plaintiff and defendants received a gift of two residences from their mother. Each took an undivided one-third interest in the properties.

         In 2006 the parties entered into a settlement agreement to resolve a probate claim regarding their mother's estate initiated by defendant Howells. Paragraph 11.1 of the settlement agreement, entitled “Sale of properties, ” stated, “Mista, Stara and Russell [(i.e., plaintiff and defendants)] may sell the properties at any time they agree to do so. However, this provision shall not prevent any one or more of the parties from filing a partition action with respect to either or both the properties, in the event that Mista, Stara and Russell are unable to unanimously agree on whether or not the properties should be sold.”

         Paragraph 21.1 of the settlement agreement provided for attorney fees, stating, “Should any party hereto retain counsel for the purpose of enforcing or preventing the breach of any provision herein, including but not limited to instituting an action for a declaration of such party's rights or obligations hereunder, or for any other judicial remedy, then the prevailing party shall be entitled in addition to such other relief as may be granted, to be reimbursed by the other party for all costs and expenses incurred thereby, including but not limited to, reasonable attorney's fees and costs.”

         In October 2013, plaintiff filed a complaint against defendants seeking partition by sale of both properties. The complaint referred to the 2006 settlement agreement, alleging that as part of that agreement “the Parties stipulated that any one of them could partition the Properties in the absence of a unanimous agreement among them.” The complaint also referenced the attorney fee provision in the agreement, and plaintiff sought attorney fees and costs in the prayer.

         The trial court granted summary judgment for plaintiff, and entered an interlocutory judgment for partition by sale. In a separate order, the trial court awarded attorney fees to plaintiff pursuant to paragraph 21.1 of the 2006 settlement agreement and Civil Code section 1717, which governs awards of attorney fees for actions on contract.[1] The court found that plaintiff's partition action “concerned enforcement of one of the provisions of the settlement agreement-paragraph 11.1-that allowed for partition by sale of the properties at issue” and therefore fell within the attorney fees provision. The court rejected defendants' argument that plaintiff had the right to seek partition independent of the agreement: “... Defendants, who were represented by counsel in the execution of the Settlement Agreement, voluntarily included this provision in the agreement. Plaintiff, through this action, specifically sought to enforce that provision as cited in her complaint.”

         The court found that the fees sought by plaintiff “were incurred for the common benefit, ” as required to apportion attorney fees among the parties to a partition action. (See Code Civ. Proc., §§ 874.010, 874.040.) Given its ruling under Civil Code section 1717, however, the court declined to apportion fees and instead awarded them all to plaintiff.[2]

         Defendants timely appealed.[3]

         DISCUSSION

         1. Entitlement to attorney fees under settlement agreement

         Defendants argue the court erred in interpreting the settlement agreement to allow recovery of attorney fees for a ...


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