California Court of Appeals, Fourth District, Second Division
HIGHLAND SPRINGS CONFERENCE AND TRAINING CENTER et al., Plaintiffs and Appellants,
CITY OF BANNING, Defendant and Respondent SCC ACQUISITIONS, INC., et al., Real Parties in Interest and Respondents.
from the Superior Court of Riverside County No. RIC460950.
Thomas H. Cahraman, Judge. Reversed with directions.
Chatten-Brown, Carstens & Minteer, Joshua R.
Chatten-Brown and Jan Chatten-Brown, for Plaintiff and
Appellant Highland Springs Conference and Training Center.
Leibold McClendon & Mann and John G. McClendon for
Plaintiff and Appellant Banning Bench Community of Interest
Aleshire & Wynder and Anthony R. Taylor and Stephen R.
Onstot for Defendant and Respondent.
Cook & Thel, Francis T. Donohue III; Bruce V. Cook and
Andrew P. Cook for Real Parties in Interest and Respondents.
RAMIREZ P. J.
and appellants, Highland Springs Conference and Training
Center (Highland Springs) and Banning Bench Community of
Interest Association (Banning Bench), appeal from the August
3 and 4, 2017, orders limiting the attorney fees plaintiffs
could recover from real parties in interest, SCC/Black Bench
LLC (SCC/BB) and SCC Acquisitions, Inc. (SCCA). In cost
memoranda, and again in duplicative fee motions, plaintiffs
sought to recover fees they incurred in successfully pursuing
a motion to amend their October 2008 judgments against
SCC/BB, to add SCCA to the October 2008 judgments as an
additional judgment debtor. We reverse and remand the matter
to the court with directions to redetermine the amount of
each plaintiff's fee award.
April 2008, a judgment was entered in favor of plaintiffs
against defendant and respondent, City of Banning (the City),
and SCC/BB, on plaintiffs' writ petitions challenging the
City's certification of an environmental impact report
for a development project known as the Black Bench project.
(Highland Springs, supra, 244 Cal.App.4th
at p. 272.) SCC/BB was the only named real party in interest
in the writ petitions. In October 2008, the court awarded
Highland Springs $421, 819.96, and awarded Banning Bench
$288, 920.01, in costs and attorney fees against SCC/BB.
(Code Civ. Proc., §§ 1032, 1033.5,
end of 2008, SCC/BB lost the Black Bench property in
foreclosure and had exhausted around $14 million in capital.
(Highland Springs, supra, 244 Cal.App.4th
at pp. 272, 277.) SCC/BB appealed the April 2008 judgment,
but its appeal was dismissed in September 2008 after it
failed to deposit the costs of preparing the record on
appeal. (Id. at p. 272.) In October 2012, plaintiffs
filed an alter ego motion, under section 187, seeking to add
SCCA to the April 2008 and October 2008 judgments as an
additional judgment debtor, and thus render SCCA liable,
along with SCC/BB, for paying plaintiffs' attorney fees
and costs awards against SCC/BB. The court denied the alter
ego motion on the sole ground that plaintiffs failed to act
with diligence in bringing the motion, and plaintiffs
appealed. (Id. at p. 273.)
Highland Springs, this court reversed the order
denying the alter ego motion. (Highland Springs,
supra, 244 Cal.App.4th at p. 273.) This court
concluded that the motion was erroneously denied based on
plaintiffs' delay in bringing it, because SCCA did not
show it had been prejudiced by the delay. Thus, SCCA did not
meet its burden of showing that the alter ego motion was
barred by laches. (Id. at pp. 273, 282-289.) The
matter was remanded to the court to determine whether
plaintiffs had proved their alter ego claim against SCCA.
(Id. at pp. 289-290.) SCC/BB did not appear in
Highland Springs. (Id. at p. 272.) The
remittitur issued on May 3, 2016.
further trial court proceedings on the alter ego motion
between plaintiffs and SCCA, on February 8, 2017, the court
entered a judgment in favor of plaintiffs on the motion,
adjudicating SCCA to be SCC/BB's alter ego and amending
the October 2008 judgments against SCC/BB to add SCCA to
those judgments as an additional judgment debtor.
February 9, 2017, notice of entry of the February 8, 2017,
judgment was served, and each plaintiff filed a memorandum of
costs after judgment (§ 685.070) seeking fees and costs
incurred in having successfully pursued the alter ego motion.
In its cost memorandum, Highland Springs sought $446, 710 in
fees incurred between July 2012 and February 2017, plus
$815.53 in costs. In its cost memorandum, Banning Bench
sought $216, 545 in fees incurred between January 2009 and
January 2017, plus $320.38 in costs. On February 17, 2017,
SCC/BB filed motions to tax each cost memorandum, and SCCA
later joined SCC/BB's motions to tax.
April 10, 2017, each plaintiff filed a motion for attorney
fees, seeking the same fees listed in their cost memoranda,
plus additional fees. In its fee motion, Highland Springs
sought $737, 870.25 in fees ($490, 698.50 in lodestar fees
[hours worked times hourly rates] times a multiplier of 1.5),
plus fees not yet incurred in bringing the fee motion.
Banning Bench sought $536, 454.39 in fees and costs
(including $324, 817.50 in lodestar fees, multiplied by 1.5),
plus fees not yet incurred in bringing the fee motion. Each
fee motion stated that it was being brought pursuant to
sections 685.040 to 685.080 of the Enforcement of Judgments
Law (the EJL) (§ 680.010 et seq.) and section 1021.5. On
May 10, 2017, SCC/BB and SCCA filed a joint opposition to the
Bench moved to strike SCC/BB's and SCCA's motions to
tax and also filed a motion for sanctions against counsel for
SCC/BB and SCCA. (§§ 128.5, 128.7.) Banning Bench
claimed that SCC/BB's counsel had wrongfully caused
SCC/BB to file the motions to tax, despite knowing that
SCC/BB was “cancelled in California in 2010 and...
ceased to exist in 2011.”
August 3 and 4, 2017, the court denied Banning Bench's
motion for sanctions and motions to strike SCC/BB's
motions to tax, and entered judgment in favor of plaintiffs
on their cost memoranda and fee motions. The court granted
the fee motions, in part, and granted the motions to tax, in
part, by awarding each plaintiff fees but limiting those fees
to $80, 000 for each plaintiff, substantially fewer fees than
each plaintiff was requesting.
court based its $80, 000 fee awards on three considerations.
First, the court ruled that plaintiffs were not entitled to
recover any of the fees they incurred on appeal in
Highland Springs, because they did not file a
timely motion for attorney fees on appeal within 40
days after the remittitur in Highland Springs issued
on May 3, 2016, pursuant to rule 3.1702(c)(1) of the
California Rules of Court.
the court ruled that, under section 685.080, subdivision (a),
of the EJL, plaintiffs were not entitled to recover
any fees they incurred more than two years before
they filed their fee motions. Third, for the two-year
period during which plaintiffs could recover fees,
which, the court ruled, excluded any fees incurred on appeal
in Highland Springs, the court ruled that 200 hours
of attorney time for each plaintiff was a reasonable number
of hours, and a blended rate of $400 per hour was a
reasonable hourly rate, to award each plaintiff under section
the court awarded each plaintiff $80, 000 in fees (200 hours
times $400 per hour), on each fee motion. The court expressly
found no basis for applying a lodestar multiplier to the
lodestar fee requests under section 1021.5. Plaintiffs timely
TheFees PlaintiffsIncurred in
Pursuing Their Alter Ego Motion are Prejudgment Fees Incurred
in Obtaining the February 8, 2017, Judgment; Thus, the Fee
Motions are Governed ...