Opinion
B156018. B130847. B097188.
10-8-2003
LIONEL A. DALEY, Plaintiff and Appellant, v. GILBERT S. AZAFRANI, Defendant and Respondent.
Lionel A. Daley, in pro. per., for Plaintiff and Appellant. No appearance for Defendant and Respondent.
Plaintiff Lionel A. Daley appeals from orders denying Daleys motion for contractual attorney fees and sanctions, and granting defendant Gilbert S. Azafranis motion to tax costs incurred by Daley in the Daley II appeal (Daley v. Azafrani (B130847, Feb. 27, 2001) [nonpub. opn.]). We modify the order taxing costs and, as modified, affirm the orders.
BACKGROUND
This is the third appeal in this litigation between Daley and his former attorney, Azafrani. Daley I (Daley v. Azafrani (B097188, May 15, 1998) [nonpub. opn.]) involved the underlying legal malpractice action in which Azafrani defeated the bulk of Daleys malpractice claim on a partial directed verdict, but incurred a $250 damages award. On appeal in Daley I, Daley sought to overturn, among other things, the partial directed verdict for Azafrani. In affirming the judgment in Daley I, we awarded costs on appeal to Azafrani.
After the Daley I remittitur issued, the trial court awarded Azafrani $4,131.25 in costs incurred in the Daley I appeal. In Daley II, Daley appealed from the costs award, contending Azafrani had failed to provide substantiation in response to Daleys motion to tax costs. In Daley II, we reversed Azafranis costs award and remanded for a hearing on Daleys motion to tax costs. We awarded Daley his costs incurred in the Daley II appeal.
After the Daley II remand, the trial court granted in its entirety Daleys motion to tax Azafranis Daley I costs. The trial court refused to award Azafrani any costs incurred in the Daley I appeal.
Thereafter, Daley (who was and is in pro. per.) moved for contractual attorney fees of $3,146.25 and sanctions of $1,100 against Azafrani. Apparently, while Daley II was pending, Azafrani had attached Daleys bank account in Texas to enforce the Daley I costs award (which we subsequently reversed in the Daley II appeal). Daley contends Azafrani was barred from enforcing the costs award while the Daley II appeal was pending.[] Daley sought $1,100 in sanctions for having had to oppose "Azafranis fraudulent Cost Memorandum," and $3,146.25 for attorney fees allegedly incurred in opposing the Texas attachment order.
We express no opinion as to whether the filing of the Daley II appeal stayed enforcement of the costs award. If an undertaking was requested and ordered, but not given, the filing of the Daley II appeal would not have stayed enforcement of the costs award. (Code Civ. Proc., § 917.9, subd. (a)(3).) Accordingly, it is possible the Daley II appeal did not stay enforcement of the costs award.
On June 18, 2001, Daley filed a memorandum of costs in the trial court to recover his Daley II appellate costs. In his costs bill, Daley again listed the $ 3,146.25 in legal fees allegedly incurred in opposing the Texas attachment order, and $3,712.21 in costs allegedly incurred in the Daley II appeal, for a total of $6,858.46. The $3,712.21 in costs allegedly incurred in Daley II consisted of: $350 to file the Daley II notice of appeal;[] $23 to file a motion in superior court for reconsideration of the Daley I costs award; $591.38 in attachment expenses; $107.88 for the balance due on the Daley II clerks transcript; $39 in court reporter fees to prepare the Daley II reporters transcript; and $ 2,600.95 for various expenses (including reproduction, legal research, certified copies, notary fees, transmission and filing of documents).
Included in the $350 was the $100 deposit for the clerks transcript.
On August 13, 2001, Azafrani moved to strike or tax Daleys June 18, 2001, costs bill. Among other things, Azafrani contended Daleys Texas legal fees (which had been denied by the Texas court) were not recoverable in this litigation. Azafrani also denied the existence of a written contract to support an award of contractual attorney fees. Azafrani pointed out that in Daley I, this court had affirmed the jurys finding that there was no written contract between Daley and Azafrani.
In opposition to the motion to strike or tax costs, Daley contended, among other things, that Azafranis motion was not timely filed under California Rules of Court, rule 870(b), which requires such motions to be served and filed within 15 days after service of the costs memorandum, with an additional 5 days where the memorandum was served by mail (Code Civ. Proc., § 1013). As Daley had served his costs bill by mail on June 18, 2001, the 20th day after mailing fell on July 8, 2001, a Sunday (which extended the filing deadline to Monday, July 9, 2001). (Code Civ. Proc., §§ 10, 12a.) Given Azafranis failure to seek relief for the late filing of his motion under Code of Civil Procedure section 473, the filing of his motion on August 13, 2001, was not timely.
On September 17, 2001, the court denied Daleys motion for sanctions and attorney fees. With regard to sanctions, the court concluded the motion was unintelligible, unsupported by legal authority or competent evidence, failed to comply with the procedural requirements of Code of Civil Procedure section 128.5, and failed to explain the basis for sanctioning conduct that allegedly occurred in a Texas court. With regard to attorney fees, the court found the motion was unintelligible, unsupported by legal authority or competent evidence, and failed to explain the basis for entitlement to fees, the amount of fees incurred, or the reasonableness of those fees. The court noted that even assuming the existence of a valid and enforceable contract, the retainer agreement submitted by Daley failed to include an attorney fee clause.[]
Paragraph 7 of the retainer agreement stated: "AWARD OF FEES [¶] Client understands that if this matter [Daley v. Scheinbaum] is litigated, one party may be ordered to pay another a reasonable Attorneys fee and costs. If any such award is made on behalf of Client and paid to Attorney, it will be credited against any obligation of Client to Attorney, but Client will be liable for any excess. Client will be liable for any award rendered against Client and the same shall be separate from any fees or costs owing to Attorney." We agree with the trial court that this clause failed to entitle Daley to recover attorney fees from Azafrani as an item of costs incurred in the Daley II appeal.
The court continued the hearing on Daleys costs memorandum and allowed the parties to file additional papers. On September 26, 2001, Daley filed a revised cost memorandum (omitting any request for attorney fees relating to the Texas matter and eliminating a few other items of costs originally requested in the June 18, 2001, costs bill), a motion for approval of costs, and supporting declarations and documentation. Daleys revised costs memorandum sought $2,964.22 in costs, whereas the June 18, 2001, costs bill had sought $3,712.21 in costs. The items sought in the revised costs bill consisted of: $350 to file the Daley II notice of appeal,[] $107.88 for the Daley II clerks transcript, $39 for the court reporters fee to prepare the Daley II reporters transcript, and $2,467.34 in other costs (binding, reproduction, clerical, messenger, parking, postage, and mileage).
Included in the $350 was the $100 deposit for the clerks transcript.
On October 10, 2001, Azafrani filed a timely motion to strike or tax the June 18, 2001, costs bill. Among other things, Azafrani contended Daley had failed to submit photocopies of the backs of the checks to reflect their receipt and deposit. In addition, Azafrani objected that the checks were drawn on the account of a non-party, Decisive Management, Inc. Azafrani stated in part: "[The] checks are of a Corporation i.e., Decisive Management, Inc., which unknown Corporation is not a party to this action, a separate entity than the individual party Daley, has a different address than Daleys and which corporation cannot legally make an appearance before this court without counsel to request anything. Daley is not an attorney and unless he admits to practicing law without a license Daley cannot represent[] a corporations interest or claim before this court." Azafrani also disputed, among other things: (1) certain copying costs as unsupported and unreasonable, and as associated with trial court rather than appellate proceedings; (2) administrative services costs as unrecoverable and unreasonable; (3) parking costs as an unrecoverable trial court expense; and (4) postage costs as unsubstantiated.
In reply, Daley objected that Azafranis motion to strike or tax costs contained argumentative statements. Daley also submitted additional documentation of costs.
After hearing oral argument on the revised costs memorandum and motion to strike or tax costs, the court took the matter under submission. On November 15, 2001, the court granted Daley costs of $210.07, but taxed the remaining costs items. The $210.07 award consisted of: $23 in connection with the "motion for reconsideration of Judge Bakers order granting defendants fraudulent memorandum of fabricated costs" (which item was deleted from the revised costs bill of September 26, 2001); $107.88 for the clerks transcript; and $79.19 for binding costs. (Caps. omitted.)
The trial court refused to award Daley $350 for filing the Daley II notice of appeal, stating that the filing fee was not "actually incurred by" Daley because it was paid "by a third-party corporation, i.e. Decisive Management, Inc. . . ." The trial court also refused to allow the court reporters $39 fee for preparing the Daley II reporters transcript, stating that Daleys declaration was incompetent to prove the amount of the court reporters fee. The trial court refused to award $591.38 in attachment costs, an item that had been omitted from the September 26, 2001, costs bill. As for the remaining costs that were taxed, the court found that Daley had failed to show they were reasonable and actually incurred by him, given that the checks had been issued by Decisive Management, Inc.
Daley has appealed from both the September 17, 2001, order denying attorney fees and sanctions, and the adverse portion of the November 15, 2001, order taxing costs. Azafrani has not filed a respondents brief. (Cal. Rules of Court, rule 17(a)(2).)
DISCUSSION
I
Attorney Fees & Sanctions
Daley contends the trial court erred in denying his request for contractual attorney fees that were allegedly incurred in defending against the Texas attachment order.
"Except as attorneys fees are specifically provided for by statute, the measure and mode of compensation of attorneys and counselors at law is left to the agreement, express or implied, of the parties . . . ." (Code Civ. Proc., § 1021.) Attorney fees may be recoverable as costs when authorized by contract, statute, or law. (Code Civ. Proc., § 1033.5, subd. (a)(10); see 7 Witkin, Cal. Procedure (4th ed. 1997) Judgments, § 134, p. 650.)
We agree with the trial court that Daley has failed to establish a right to contractual attorney fees. Daley contended below that the retainer agreement contained an attorney fee clause which entitled him to recover the fees allegedly incurred in defending against the Texas attachment order. As Azafrani pointed out below, however, Daley II upheld the jurys finding that there was no written contract between Daley and Azafrani. Moreover, as the trial court noted, even assuming the retainer agreement relied upon by Daley constituted a binding contract, the agreements attorney fee clause pertained to fees awarded to or against Daley in the underlying case, Daley v. Scheinbaum. The agreements attorney fee clause did not pertain to fees incurred in any litigation between Daley and Azafrani. Accordingly, we affirm the trial courts order denying Daley attorney fees pursuant to contract.
Turning to the issue of sanctions, we note that Daley sought $1,100 for opposing "Azafranis fraudulent Cost Memorandum." The trial court refused to award sanctions for numerous reasons, including Daleys failure to comply with Code of Civil Procedure section 128.5. Subdivision (a) of that section provides: "Every trial court may order a party, the partys attorney, or both to pay any reasonable expenses, including attorneys fees, incurred by another party as a result of bad-faith actions or tactics that are frivolous or solely intended to cause unnecessary delay. . . ." According to subdivision (b)(2), "`Frivolous means (A) totally and completely without merit or (B) for the sole purpose of harassing an opposing party."
Daley called Azafranis memorandum of costs "fraudulent" due to Azafranis failure to substantiate his costs in response to Daleys motion to tax costs. Azafranis failure to substantiate his costs does not, however, necessarily prove his costs bill was "fraudulent." One may file a legitimate costs bill without providing any supporting documentation. In the absence of a motion to strike or tax costs, a partys or his attorneys initial verification that the items of costs are correct and were necessarily incurred in the case is all that is required to establish the reasonable necessity of the costs claimed. "There is no requirement that copies of bills, invoices, statements, or any other such documents be attached to the memorandum. Only if the costs have been put in issue via a motion to tax costs must supporting documentation be submitted. [Citation.]" (Jones v. Dumrichob (1998) 63 Cal.App.4th 1258, 1267.) While Azafranis failure to produce supporting documentation in response to Daleys motion to tax costs was fatal to his recovery of costs, it was not necessarily evidence "of bad-faith actions or tactics that are frivolous or solely intended to cause unnecessary delay" under Code of Civil Procedure section 128.5, subdivision (a). Failing to supply supporting documentation responsive to a motion to strike or tax costs is not necessarily a concession that the memorandum of costs was filed in bad faith.
On this record, we find no basis to disturb the trial courts order denying sanctions. "`A judgment or order of the lower court is presumed correct. All intendments and presumptions are indulged to support it on matters as to which the record is silent, and error must be affirmatively shown. . . . [Citations.]" (Denham v. Superior Court (1970) 2 Cal.3d 557, 564.)
II
Costs Incurred in Daley II
Daley correctly points out Azafranis motion to strike or tax the June 18, 2001, memorandum of costs was not timely filed. A delay in challenging or a failure to challenge a costs bill constitutes a waiver of any objection to the costs claimed thereon. (Douglas v. Willis (1994) 27 Cal.App.4th 287, 290.)
On September 26, 2001, however, Daley filed a revised costs bill. On October 10, 2001, Azafrani filed a timely motion to tax or strike costs. Daley supplied supporting documentation in response to that motion, without objecting that Azafrani had waived the right to object. Under these circumstances, we conclude Daleys filing of a revised costs bill started the clock running anew, notwithstanding Azafranis failure to file a timely motion to strike or tax costs with regard to the original costs bill. Accordingly, we deem the revised costs bill and October 10, 2001, motion to strike or tax costs to be the operative documents before us on this appeal.[]
As Daley correctly points out, the trial courts cost award indicates some confusion regarding which of the two cost memoranda — the original one filed on June 18, 2001, or the revised one filed on September 26, 2001 — was before the court. For example, the court refused to award $591.38 in attachment costs and awarded $23 for a trial court motion, even though both items had been omitted from the revised memorandum of costs and were no longer before the court.
California Rules of Court, rule 27(c)(1) provides: "A party may recover only the following costs, if reasonable: [& para;] (A) the amount the party paid for any portion of the record, whether an original or a copy or both. The cost to copy parts of a prior record under rule 10(b)(2) is not recoverable unless the Court of Appeal ordered the copying; [¶] (B) the cost to produce additional evidence on appeal; [¶] (C) the costs to notarize, serve, mail, and file the record, briefs, and other papers; [¶] (D) the cost to print and reproduce any brief, including any petition for rehearing or review, answer, or reply; and [¶] (E) the cost to procure a surety bond, including the premium and the cost to obtain a letter of credit as collateral, unless the trial court determines the bond was unnecessary."
Turning to the merits of Daleys appeal, we conclude the order taxing costs must be modified. The trial court erred in refusing to award the cost of filing the notice of appeal simply because Decisive Management, Inc., rather than Daley, had paid for them. The identity of the entity that paid the filing fees is irrelevant. "Any award of costs shall be subject to the following: [¶] . . . Costs are allowable if incurred, whether or not paid." (Code Civ. Proc., § 1033.5, subd. (c)(1).)
The trial court also erred in rejecting Daleys declaration as incompetent evidence to establish the amount charged by the court reporter. Under rule 870(a)(1) of the California Rules of Court, "the required documentation must be of evidentiary quality. Rule 870(a)(1) does not specify the type of documentation required." (Jones v. Dumrichob, supra, 63 Cal.App.4th at p. 1267.)
Having reviewed the record, we award Daley the following costs incurred in the Daley II appeal:
Item 1 — Filing and motion fees . . . . . . . . . . . . $ 350.00[] Item 9 — Court-ordered transcripts . . . . . . . . . . . $ 107.88 Item 12 — Court reporter fees . . . . . . . . . . . . . $ 39.00 Item 13 — Other . . . . . . . . . . . . . . . . . . . . Binding . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 79.19 Copies (2 × $.57) . . . . . . . . . . . . . . . . . . . . . . $ 1.14 Copies (1840 × $.07) . . . . . . . . . . . . . . . . . . . . $ 128.80 Postage . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 19.90 TOTAL . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 725.91
The $350 for Item 1 includes the $100 deposit for the transcript. The balance of the transcript cost ($107.88) is listed under Item 9.
We find no basis to overturn the courts rejection as unwarranted the requested costs of $1,460.20 for administrative assistant and clerical costs, $403.50 for messenger services, $19.65 for parking, and $23.76 for mileage.
DISPOSITION
We modify the order taxing costs by increasing the amount of the award from $210.07 to $725.91. As modified, the orders are affirmed. The parties shall bear their own costs on appeal.
We concur: SPENCER, P.J. and MALLANO, J.