California Civil Code Section 1717 - Interpretation

In Santisas v. Goodin (1998) 17 Cal. 4th 599, the Supreme Court expressly concluded that "in voluntary pretrial dismissal cases, Civil Code section 1717 bars recovery of attorney fees incurred in defending contract claims . . . ." (Id. at p. 602.) In reaching such conclusion, the Supreme Court construed subdivision (b)(2) of section 1717 "as overriding or nullifying conflicting contractual provisions, such as provisions expressly allowing recovery of attorney fees in the event of voluntary dismissal or defining 'prevailing party' as including parties in whose favor a dismissal has been entered. When a plaintiff files a complaint containing causes of action within the scope of section 1717 (that is, causes of action sounding in contract and based on a contract containing an attorney fee provision), and the plaintiff thereafter voluntarily dismisses the action, section 1717 bars the defendant from recovering attorney fees incurred in defending those causes of action, even though the contract on its own terms authorizes recovery of those fees." (Santisas, at p. 617.) In Trope v. Katz (1995) 11 Cal. 4th 274, a breach of contract action, our Supreme Court held that "an attorney who chooses to litigate in propria persona rather than retain another attorney to represent him in an action to enforce a contract containing an attorney fee provision" cannot recover " 'reasonable attorney's fees' under Civil Code section 1717 . . . as compensation for the time and effort expended . . . ." As relevant, subdivision (a) of Civil Code section 1717 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." Why? Because "the usual and ordinary meaning of the words 'reasonable attorney's fees' is the consideration that a litigant pays or becomes liable to pay in exchange for legal representation and the words 'attorney's fees' and 'counsel fees,' whether used in a contract or in a statute, had an established legal meaning at the time the Legislature enacted Civil Code section 1717. In the absence of some indication either on the face of that statute or in its legislative history that the Legislature intended its words to convey something other than their established legal definition, the presumption is almost irresistible that the Legislature intended them to have that meaning." (Trope v. Katz, supra, 11 Cal. 4th at p. 282.) In addition, the Supreme Court explained that any other construction of Civil Code section 1717 would in effect create two separate classes of pro se litigants--those who are attorneys and those who are not--and grant different rights and remedies to each. "The time that a doctor, for example, spends litigating a case on his own behalf also has value, both to the doctor himself and to society generally . . . ; an architect's time could otherwise be spent designing or building houses; a painter's time could be spent creating works of art . . . . However, it is clear that when it enacted Civil Code section 1717 the Legislature did not intend to allow doctors, architects, painters, or any other nonattorneys to receive compensation for the valuable time they spend litigating a contract matter on their own behalf." (Trope v. Katz, supra, 11 Cal. 4th at p. 285.)