Gilbert v. Master Washer & Stamping Co

In Gilbert v. Master Washer & Stamping Co. (2001) 87 Cal.App.4th 212, the issue arose whether an attorney may recover reasonable attorney fees when he is represented by other members of his firm. The underlying case was a landlord-tenant dispute. The tenant complained that the landlord's attorney, Gernsbacher, had interfered with its recovery of the property. The attorney prevailed against this complaint, but the trial court denied his request for attorney fees. "The trial court found Gernsbacher was not entitled to attorney fees because he was represented by his own law firm, Gernsbacher & McGarrigle, APC, and did not present evidence he was 'obligated to pay' the legal fees incurred on his behalf by the attorneys representing him in this matter." (Gilbert, supra, 87 Cal.App.4th at p. 217.) The appellate court in Gilbert found Trope distinguishable. "A member of a law firm who is represented by other attorneys in the firm 'incurs' fees within the meaning of Civil Code section 1717. Either the represented attorney will experience a reduced draw from the partnership (or a reduced salary from the professional corporation) to account for the amount of time his or her partners or colleagues have specifically devoted to his or her representation, or absorb a share of the reduction in other income the firm experiences because of the time spent on the case. This is different from the 'opportunity costs' the attorney loses while he or she is personally involved in the same case, because the economic detriment is caused not by the expenditure of his or her own time, but by other attorneys working on his or her behalf." (Gilbert, supra, 87 Cal.App.4th at p. 221.) "There can be no question an attorney-client relationship is also present where an attorney litigant is represented by other attorneys in his or her own firm." (Id. at p. 222.) Finally, there is no unfairness in allowing an attorney to recover for work done by others in his or her firm. "Like a corporation represented by in-house counsel, the represented attorney seeks to recover fees for work done by others on his behalf. Indeed, it would be inequitable in the extreme to permit Gernsbacher to recover fees incurred by outside counsel, but deny him such recovery merely because his counsel are members of the same law firm as he." (Id. at p. 223.)