California Civil Code Section 1717(a) Attorney Fees
Civil Code Section 1717, subdivision (a), authorizes the trial court to award reasonable attorney fees to the prevailing party in a contract action if the contract specifically provides for an award of such fees.
Section 1717, subdivision (a), provides: "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. . . . Reasonable attorney's fees shall be fixed by the court, and shall be an element of the costs of suit."
"The party prevailing on the contract shall be the party who recovered a greater relief in the action on the contract." ( 1717, subd. (b)(1).)
"When a defendant defeats recovery by the plaintiff on the only contract claim in the action, the defendant is the party prevailing on the contract under section 1717 as a matter of law." (Hsu v. Abbara (1995) 9 Cal.4th 863, 876; accord, Zintel Holdings, LLC v. McLean (2012) 209 Cal.App.4th 431, 440.) "When the decision on the litigated contract claims is purely good news for one party and bad news for the other . . . a trial court has no discretion to deny attorney fees to the successful litigant." (Hsu, at p. 876; see Zintel Holdings, at p. 443.)
The "validity or existence of the contract alleged in the complaint is not a prerequisite to an award of attorney fees under section 1717. . . . A party is entitled to attorney fees under section 1717 'even when the party prevails on grounds the contract is inapplicable, invalid, unenforceable or nonexistent, if the other party would have been entitled to attorney's fee had it prevailed.'" (Hsu, at p. 870.)
The abuse of discretion standard governs our review of the trial court's determination of a reasonable attorney fee. (E.g., Ketchum v. Moses (2001) 24 Cal.4th 1122, 1140; PLCM Group, Inc. v. Drexler (2000) 22 Cal.4th 1084, 1096 (PLCM Group).)
"The fee setting inquiry in California ordinarily begins with the 'lodestar,' i.e., the number of hours reasonably expended multiplied by the reasonable hourly rate." (PLCM Group, at p. 1095.)
"Under this method, the court 'begins with a touchstone or lodestar figure, based on the "careful compilation of the time spent and reasonable hourly compensation of each attorney . . . involved in the presentation of the case."' The lodestar 'should ordinarily include compensation for all the hours reasonably spent' on the case , but the court must 'carefully review attorney documentation of hours expended; "padding" in the form of inefficient or duplicative efforts is not subject to compensation.' The lodestar may then be adjusted 'to fix a fee at the fair market value for the particular action.'" (Komarova v. National Credit Acceptance, Inc. (2009) 175 Cal.App.4th 324, 348.)
"The value of legal services performed in a case is a matter in which the trial court has its own expertise. The trial court may make its own determination of the value of the services contrary to, or without the necessity for, expert testimony. The trial court makes its determination after consideration of a number of factors, including the nature of the litigation, its difficulty, the amount involved, the skill required in its handling, the skill employed, the attention given, the success or failure, and other circumstances in the case.'" (PLCM Group, supra, 22 Cal.4th at p. 1096.)
"'The "experienced trial judge is the best judge of the value of professional services rendered in his court, and while his or her judgment is of course subject to review, it will not be disturbed unless the appellate court is convinced that it is clearly wrong"--meaning that it abused its discretion.'" (Id. at p. 1095.)