Hydratec, Inc. v. Sun Valley 260 Orchard & Vineyard Co

In Hydratec, Inc. v. Sun Valley 260 Orchard & Vineyard Co. (1990) 223 Cal.App.3d 924, plaintiff (Hydratec) filed three separate lawsuits against various entities, including defendant AFM. The proceedings in the three cases were consolidated, and a court trial was held. The trial court issued a written tentative decision, which was to become the statement of decision if no party requested a statement of decision. No request was made, and plaintiff's counsel thereafter furnished the court with three separate judgments, one for each of the matters tried. Each of the proposed judgments provided that the parties would bear their own costs and attorney fees. The trial court signed and filed the judgments, and AFM then filed a notice of appeal. On appeal, AFM contended that it had been the prevailing party in two of the three matters and was entitled to an award of costs and attorney fees pertaining to those matters (pursuant to a contractual attorney fee provision). (Id. at pp. 926-927.) The appellate court concluded, however, that "AFM's failure to file a cost bill and a claim for fees operated to waive its right to costs and fees." (Id. at p. 927.) The appellate court noted that the California Rules of Court, former rules 870(a)(1) and 870.2, required a prevailing party to serve and file a memorandum of costs, as well as a notice of motion to claim attorney fees pursuant to contract, within one of the applicable alternative time limits set out in those rules. (Hydratec, supra, 223 Cal.App.3d at p. 928.) The court observed that if a trial court entered judgment and neglected to award costs, the party entitled to claim them could request that the court correct the judgment. The appropriate procedure would be for that party to file a cost bill. (Ibid.) "Once a bill is presented, any subsequent failure of the court to act on it may be remedied by 'appropriate motion in the trial court or, if necessary, by a writ of mandate in the appellate courts.' " (Ibid., citing Williams v. Santa Maria Joint Union High Sch. Dist. (1967) 252 Cal.App.2d 1010, 1014, fn. 5.) The court continued: "However, the fact an incorrect cost allocation may be rectified does not mean the aggrieved party may wait and raise the issue for the first time on appeal. To the contrary, if the claimant fails to present a cost bill, a waiver of the right to costs results. The time provisions relating to the filing of a memorandum of costs, while not jurisdictional, are mandatory." (Hydratec, supra, at pp. 928-929.) The court found that AFM's failure to file a cost bill was fatal to its claim for costs. (Ibid.) The Hydratec court also held that "the same treatment must be given to AFM's failure to request an award of its attorney fees against Hydratec." (Hydratec, supra, 223 Cal .App.3d at p. 929.) The court reasoned that fees to which a party is entitled under Civil Code section 1717 are treated as an item of costs (see Code Civ. Proc., 1033.5, subds. (a)(10) & (c)(5)), and as then applicable, California Rules of Court, rule 870.2 required a motion to claim attorney fees under Civil Code section 1717 be filed within the same time limits as were prescribed in California Rules of Court, rule 870 for the filing of memoranda of costs. "Since AFM did not comply with the provisions of either California Rules of Court, rule 870 or 870.2, it waived its right to secure an award of fees pursuant to the two alternatives open to it under Code of Civil Procedure section 1033.5, subdivision (c)(5)." (Hydratec, supra, at p. 929.)