Opinion
C042013.
10-7-2003
RONALD J. RICKABAUGH, Plaintiff and Appellant, v. LAUREN ANN ENOCHS, Defendant and Respondent.
This appeal follows a jury trial in which plaintiff Ronald J. Rickabaugh was awarded substantial damages against defendant Lauren Ann Enochs Albrecht (Enochs) and codefendant Reinhard Albrecht for personal injuries suffered when plaintiff was struck by a snowmobile driven by Enochs.
To avoid confusion between Enochs and her codefendant Reinhard Albrecht, to whom she is (or was) married, we shall use Enochs, and not her married name (Albrecht), to identify her.
In this appeal, we consider only the propriety of two orders granting Enochss motions to tax plaintiffs memoranda of costs, by which plaintiff sought to recover his attorney fees incurred in support of his claim to attorney fees in the enforcement of the judgment.
We agree with plaintiff that the trial court erred in granting Enochss motions to tax costs. Because plaintiff was statutorily entitled to recover attorney fees in connection with the underlying judgment, he was also entitled to recover his reasonable attorney fees in enforcing that judgment, including the attorney fees expended in support of his claim for such fees, which Enochss motions sought to deny. (Code Civ. Proc., §§ 685.070, 685.040, 1033.5, subd. (a)(10)(B); Ketchum v. Moses (2001) 24 Cal.4th 1122, 1141 & fn. 6.) If it were otherwise, a major purpose of awarding attorney fees — to avoid any out-of-pocket cost to a party involved in litigation — would be thwarted.
FACTUAL AND PROCEDURAL BACKGROUND
I. The Entry of Judgment Against Enochs
Plaintiff was struck by a snowmobile and injured. He sued Enochs (the driver of the snowmobile) and others.
We issued an unpublished opinion concerning an earlier appeal by plaintiff involving an order granting the motion to tax costs of defendant Hildegard Albrecht as Trustee of the Albrecht Trust. (Rickabaugh v. Hildegard Albrecht, as Trustee, etc. (Jan. 29, 2003, C040059 [nonpub. opn.] (Rickabaugh I ).) In light of the very limited record before us in this appeal, we rely upon our opinion in Rickabaugh I for a few background facts. (See Evid. Code, § 459.) None of these facts are of substantial consequence to the determination of this action (id., § 459, subd. (d)), and thus we may take judicial notice of them without any additional hearing.
Following trial, the jury found by special verdict that plaintiffs injury was caused 80 percent by Enochss negligent operation of the snowmobile and 20 percent by her codefendants negligent entrustment of the snowmobile to her. The jury thereupon awarded plaintiff substantial damages against both Enochs and her codefendant.
In separate criminal proceedings arising from the same incident, Enochs pled guilty to unlawfully injuring another while under the influence of alcohol (Veh. Code, § 23153, subd. (a)).
After the verdict, plaintiff obtained a $110,497 attorney fee award against Enochs pursuant to Code of Civil Procedure section 1021.4, which provides that the court may award reasonable attorney fees to a prevailing plaintiff against a defendant who has been convicted of a felony offense upon which the civil action is based. The attorney fee award was incorporated into the plaintiffs judgment against Enochs.
Code of Civil Procedure section 1021.4 provides: "In an action for damages against a defendant based upon that defendants commission of a felony offense for which that defendant has been convicted, the court may, upon motion, award reasonable attorneys fees to a prevailing plaintiff against the defendant who has been convicted of the felony."
II. Plaintiffs Partial Enforcement of the Judgment
During the trial of this matter, the court entered an order finding that plaintiffs counsel had engaged in a discovery abuse and ordered him to pay sanctions to Enochs.
However, at the same time that plaintiffs counsel prepared to deliver to Enochs the check satisfying the sanctions order, he also arranged for the sheriff to execute upon the check in partial satisfaction of the judgment.
III. Enochss Motions to Tax Postjudgment Attorney Fees
A. The First Memorandum of Costs After Judgment
After plaintiff was successful in partially executing upon the judgment, he filed a memorandum of costs, seeking to add to his judgment the $2,392.50 in attorney fees incurred in the course of executing on the check. (Code Civ. Proc., § 685.070.)
Opposing the request for additional fees, Enochs moved to tax the cost memorandum, albeit one day after the statutory deadline. While admitting that plaintiffs "executing on the check was entirely proper," she argued that the $2,392.50 in attorney fees were "incurred in [plaintiffs counsels] pursuit of avoiding the sanction award entered against him," and not "incurred in enforcing a judgment," as required by Code of Civil Procedure section 685.070.
Code of Civil Procedure section 685.070, subdivision (a), provides: "The judgment creditor may claim under this section the following costs of enforcing a judgment: [¶] . . . [¶] (6) Attorneys fees, if allowed by Section 685.040." As we shall see, Code of Civil Procedure section 685.040, in turn, allows attorney fees where otherwise authorized by law.
But the trial court agreed that Enochss motion to tax was untimely, denied the motion without prejudice to her seeking relief under Code of Civil Procedure section 473, and added the $2,392.50 in requested attorney fees to the plaintiffs judgment.
B. Second Memorandum of Costs After Judgment
In his second memorandum of postjudgment costs, plaintiff sought to add to the judgment $5,346 in attorney fees incurred in opposing Enochss motion to tax the first memorandum of costs. In short, he wanted the fees incurred in litigating his right to the fees expended in enforcing the judgment.
Enochs moved to tax this second cost memorandum, again arguing that the attorney fees requested were "incurred in [plaintiffs counsels] pursuit of avoiding the sanction award entered against him," not "in enforcing a judgment."
Following a hearing and additional briefing by the parties, the trial court granted Enochss motion to tax the second memorandum of costs, but on the distinct ground that attorney fees incurred in connection with the enforcement of a judgment are recoverable only if the fees arise from a contractual authorization. We will discuss the rationale of the trial courts ruling in more detail in our discussion.
C. Third Memorandum of Costs After Judgment
While the trial courts previous decision was still pending, plaintiff filed a third memorandum of costs, seeking attorney fees of $1,617 that were incurred in opposing Enochss motion to tax the second memorandum of costs.
Enochs moved to tax this third cost memorandum on the grounds that none of the requested fees related to the enforcement of a judgment and that an attorney may not recover postjudgment attorney fees related to a proper motion to tax costs.
Plaintiff responded that Code of Civil Procedure section 1021.4 entitles him to recover attorney fees incurred in the enforcement of the judgment, and in any event, that Enochs had failed to introduce any evidence to support her motion.
The trial court granted Enochss motion to tax the third cost memorandum.
Plaintiffs opposition to Enochss motion to tax his third memorandum of costs was late. However, plaintiff claimed that he merely sought to preserve the record for purposes of appeal and agreed to forego a hearing on the matter to facilitate the entry of an order that could be reviewed on appeal. The trial courts order does not suggest that it refused to consider plaintiffs opposition but instead asserts that it considered "the points and authorities submitted by the parties." Under these circumstances, we agree with plaintiff that there is no impediment to his challenging on appeal the order granting Enochss motion to tax his third cost memorandum. (See Norgart v. Upjohn Co. (1999) 21 Cal.4th 383, 399-402.)
DISCUSSION
Plaintiff contends that the trial court erred in concluding that he may not recover attorney fees incurred in opposing Enochss motions to tax his postjudgment memoranda of costs.
To consider plaintiffs contention, we must address two issues: (1) whether plaintiff was entitled to attorney fees incurred in the enforcement of the judgment, and (2) whether attorney fees expended to recover attorney fees associated with the enforcement of the judgment are themselves recoverable.
Because Enochs filed no responsive brief and the parties waived oral argument, we decide this appeal based on the record and the opening brief. (Cal. Rules of Court, rule 17(a)(2).)
I. Standard of Review
Generally, an award of attorney fees is a matter within the sound discretion of the trial court; absent a manifest abuse of discretion, the determination of the trial court will not be disturbed. (Lerner v. Ward (1993) 13 Cal.App.4th 155, 158; Erich v. Granoff (1980) 109 Cal.App.3d 920, 931.)
However, in this case, the trial court determined as a matter of law that plaintiff could not recover attorney fees incurred in enforcing the judgment because only fees authorized by contract, not statute, could be recovered. We independently assess that legal conclusion. (Akins v. Enterprise Rent-A-Car Co. (2000) 79 Cal.App.4th 1127, 1132-1133; see also Braude v. Automobile Club of Southern Cal. (1986) 178 Cal.App.3d 994, 1013-1014 [reversing where trial court denied attorney fees on incorrect legal theory].)
II. Applicable Statutes
Code of Civil Procedure section 685.070, subdivision (a), provides that "[t]he judgment creditor may claim under this section the following costs of enforcing a judgment: [¶] . . . [¶] (6) Attorneys fees, if allowed by Section 685.040."
Unless otherwise designated, all further statutory references are to the Code of Civil Procedure.
Section 685.040, in turn, provides: "The judgment creditor is entitled to the reasonable and necessary costs of enforcing a judgment. Attorneys fees incurred in enforcing a judgment are not included in costs collectible under this title unless otherwise provided by law. Attorneys fees incurred in enforcing a judgment are included as costs collectible under this title if the underlying judgment includes an award of attorneys fees to the judgment creditor pursuant to subparagraph (A) of paragraph (10) of subdivision (a) of Section 1033.5."
Accordingly, attorney fees incurred in the enforcement of a judgment are collectible as costs if "otherwise provided by law" or "if the underlying judgment includes an award of attorneys fees to the judgment creditor pursuant to subparagraph (A) of paragraph (10) of subdivision (a) of Section 1033.5." (& sect; 685.040.) Subparagraph (A) of subdivision (a)(10) of section 1033.5 includes as items recoverable as costs: "Attorney fees, when authorized by any of the following: (A) Contract."
Section 1033.5, subdivision (a)(10), provides more fully as follows: "The following items are allowable as costs under Section 1032: [¶] . . . [¶] (10) Attorney fees, when authorized by any of the following: (A) Contract. (B) Statute. (C) Law."
Thus, section 685.040 allows the recovery of reasonable and necessary attorney fees in enforcing a judgment if "otherwise provided by law" or if the underlying judgment "includes an award of attorneys fees to the judgment creditor" pursuant to a contractual authorization. (Miller v. Givens (1994) 30 Cal.App.4th 18, 20, 21 [the current version of section 685.040 "allow[s] such fees [(attorney fees incurred in enforcing the judgment)] where the underlying judgment includes an award of attorney fees arising from contract"].)
III. The Trial Courts Reasoning
The trial court focused exclusively on the final sentence of section 685.040 (that fees may be recovered where the underlying judgment includes an award of attorney fees arising from contract) to conclude that plaintiff could not recover attorney fees in enforcing his judgment because the attorney fees in the underlying personal injury suit were not authorized by contract, but by section 1021.4. Section 1021.4 provides for an award of attorney fees "[i]n an action for damages against a defendant based upon that defendants commission of a felony offense for which that defendant has been convicted . . . ." (See footnote 3, ante, for the full text.)
IV. Plaintiffs Entitlement to Attorney Fees Was "Otherwise Provided by Law" Within the Meaning of Section 685.040
Our analysis begins where the trial courts analysis left off. We agree that the last sentence of section 685.040 — which authorizes an award of attorney fees incurred in enforcing the judgment, where the judgment includes an award of attorney fees arising from contract — does not authorize the recovery of fees here, where the fees in the judgment were authorized by statute. But we turn to the second sentence of section 685.040, which states that attorney fees incurred in enforcing a judgment are not recoverable "unless otherwise provided by law."
Because we must accord "significance, if possible, to every word, phrase and sentence in pursuance of the legislative purpose" of a statute (Dyna-Med, Inc. v. Fair Employment & Housing Com. (1987) 43 Cal.3d 1379, 1387), we must give independent significance to the second sentence of section 685.040. As we shall explain, if attorney fees are authorized by statute, they have been "otherwise provided by law," and thus may be recovered as costs if expended to enforce a judgment.
It is true that section 1021.4 does not expressly authorize an award of attorney fees incurred in enforcing a judgment. It merely authorizes the recovery of attorney fees in "an action for damages . . . ." (See footnote 3, ante, for the full text.) But the case law does not appear to require an express authorization for the recovery of attorney fees in the enforcement of a judgment in order to come within the authorization of fees in the second sentence of section 685.040.
First, the California Supreme Court in Ketchum v. Moses, supra, 24 Cal.4th at page 1141, footnote 6, construed a general attorney fee statute so as to authorize attorney fees under the "otherwise provided by law" language of section 685.040. In that case, our state Supreme Court held that Code of Civil Procedure section 425.16 — which permits a defendant to "recover his . . . attorneys fees and costs" for bringing a successful motion to strike a strategic lawsuit against public participation (SLAPP suit) — includes "the fees incurred in enforcing the right to mandatory fees under Code of Civil Procedure section 425.16." (Ketchum v. Moses , supra, at p. 1141.) Rejecting the plaintiffs argument that "section 685.040 preclude[d] [such] an award of `collection fees" (id. at p. 1141, fn. 6), the state high court reasoned: "The statute [(section 685.040)] provides that attorney fees incurred in enforcement efforts `are not included in costs collectible under this title unless otherwise provided by law. Under its provisions, a litigant entitled to costs for successfully enforcing a judgment is entitled to costs, but not attorney fees unless there is some other legal basis for such an award. Because Code of Civil Procedure section 425.16, subdivision (c) provides a legal right to attorney fees, they are a permissible item of costs. [Citation.]" (Ibid.)
Likewise, here, there was "some other legal basis" for the award of attorney fees, namely, section 1021.4, upon which basis plaintiff was awarded attorney fees as part of the judgment. As such, that statute made the attorney fees incurred in enforcing the judgment a permissible item of costs.
Second, postjudgment proceedings to satisfy a judgment are regarded as part of the underlying action. (Mark Briggs & Associates, Inc. v. Kinestar, Inc. (1983) 143 Cal.App.3d 483, 486; see also Aplanalp v. Forte (1990) 225 Cal.App.3d 609, 615.) Thus, a statutory authorization for attorney fees incurred in an action would include the attorney fees incurred in a proceeding to satisfy the judgment that results from the action. Section 1021.4, upon which plaintiffs award of attorney fees was based, authorizes the recovery of attorney fees "[i]n an action for damages . . . ." (Italics added.)
Third, courts have construed general attorney fee statutes to authorize the recovery of attorney fees on appeal, even though the statutes make no reference to appellate fees: "[A]ppellate courts have consistently permitted a successful party to recover attorney fees incurred on appeal when a statute expressly permits such an award in the trial court or other lower tribunal" (Morcos v. Board of Retirement (1990) 51 Cal.3d 924, 927; e.g., Gemini Aluminum Corp. v. California Custom Shapes, Inc. (2002) 95 Cal.App.4th 1249, 1264-1265) so long as "nothing in [the statute] suggests otherwise." (Del Cerro Mobile Estates v. Proffer (2001) 87 Cal.App.4th 943, 951; see Morcos v. Board of Retirement, supra, 51 Cal.3d at p. 928; Imperial Bank v. Pim Electric, Inc. (1995) 33 Cal.App.4th 540, 557.) There is no reason for a different rule in connection with the recovery of fees incurred in enforcing the judgment.
Fourth, our construction of a statute that authorizes the recovery of attorney fees so as to include fees expended in the enforcement of the resulting judgment furthers the statutes purpose of awarding attorney fees: preventing a party from being out-of-pocket from the litigation. If a party is entitled to attorney fees in litigating an action, there is no logical reason why all fees necessary to vindicate that partys position in the litigation, including fees on appeal and in the enforcement of the judgment, should not be awarded.
Our conclusion that section 1021.4 satisfies the "otherwise provided by law" language of section 685.040 is further bolstered by the circumstances surrounding the 1992 amendment, which added the final sentence to the current version of section 685.040.
"Prior to the 1992 amendment of section 685.040 to add the final sentence . . . , it had been held that where recovery of fees was posited upon provisions in the underlying contract, entry of judgment extinguished the contractual rights (including contractual attorney fees rights), and the plaintiff was not entitled to fees as costs for enforcement of the judgment. No exception was made where the underlying judgment included an attorney fee award. [Citations.]" (Imperial Bank v. Pim Electric, Inc., supra, 33 Cal.App.4th at p. 557, fn. 13.)
In Chelios v. Kaye (1990) 219 Cal.App.3d 75 (Chelios), a case decided two years before the 1992 amendment to section 685.040, the plaintiffs sued for breach of contract and constructive fraud and obtained a judgment, including attorney fees authorized by contract. Enforcement efforts were long and expensive, and the plaintiffs sought to recover their postjudgment costs under former section 685.040. At that time, former section 685.040 specified the first two sentences, but not the third, of the existing statute: "The judgment creditor is entitled to the reasonable and necessary costs of enforcing a judgment. Attorneys fees incurred in enforcing a judgment are not included in costs . . . unless otherwise provided by law."
The plaintiffs in Chelios argued that "they f[e]ll within the `otherwise provided by law exception described by section 685.040" because "the judgment they sought to enforce was premised on an underlying contract which included a unilateral attorneys fees clause," which entitled them to fees under Civil Code section 1717. (Chelios, supra, 219 Cal.App.3d at p. 79.) The court rejected this argument, finding that the Chelioses fees were not incurred to enforce the provisions of the contract, but were instead expended to enforce the judgment. (Ibid.) The court ruled that "there was no extant contractual attorneys fees clause to trigger the application of Civil Code section 1717" because "all of the prior contractual rights are merged into and extinguished by the [final, nonappealable] monetary judgment, and thereafter the prevailing party has only those rights as are set forth in the judgment itself." (Chelios, supra, at p. 80.)
The Legislatures amendment of section 685.040 — adding what is now its final sentence — was narrowly written to overturn the holding of Chelios. (Stats. 1992, ch. 1348 (Assem. Bill No. 2616), § 3.) Comments to the digests of the proposed law by Senate and Assembly committees plainly state that the addition of the sentence was intended to "overturn" or "overrule" Chelios, and one comment noted that the "practical effect of [the Chelios] holding is to give a judgment debtor the power to force a creditor to accept a sizable discount on his judgment, or face the prospect of incurring substantial non-recoverable attorneys fees in enforcing the judgment." (Com. to Digest, Assem. Bill No. 2616, 3d reading May 13, 1992 (1991-1992 Reg. Sess.) p. 2.)
It appears from the legislative materials that this sentence was initially proposed as an addition to section 685.070.
More relevant to our analysis here, digests of the proposed legislation prepared by the Senate Judiciary and Rules Committees show that the Legislature intended that the amended statute "would allow the creditor to recover his attorneys fees as part of an award of collectible costs whenever the judgment creditor is entitled to an attorneys fee award . . . under a written contract or pursuant to statutory authority." (Sen. Rules Com., Off. of Sen. Floor Analyses, Rep. on Assem. Bill No. 2616 (1991-1992 Reg. Sess.), as amended Aug. 25, 1992, p. 2; Sen. Com. on Judiciary, Analysis of Assem. Bill No. 2616 (1991-1992 Reg. Sess.), as amended Aug. 12, 1992, p. 2; italics added).
Accordingly, our interpretation of section 685.040 is completely consonant with the lawmakers evident intent, the case law, and general legal principles regarding statutory attorney fees. In each case, a prevailing party who has been authorized by contract or statute to recover attorney fees may recover such fees incurred to enforce a judgment.
V. The Requested Attorney Fees Were Incurred in Enforcing the Judgment
If plaintiff was entitled under section 685.040 to recover attorney fees incurred in enforcing his judgment, he is also entitled to recover the attorney fees incurred in his opposition to Enochss motions to tax his first and second memoranda of costs (which fees became the subjects of his second and third memoranda of costs), since the second and third memoranda sought to recover the attorney fees expended in litigating the right to fees.
"[A]n award of fees may include not only the fees incurred with respect to the underlying claim, but also the fees incurred in enforcing the right to mandatory fees . . . . As we explained in Serrano [v. Unruh (1982)] 32 Cal.3d [621] at page 639, `follow[ing] the rule of the overwhelming majority of courts that have considered the question . . . [,] [w]e hold . . . that, absent circumstances rendering the award unjust, fees recoverable . . . ordinarily include compensation for all hours reasonably spent, including those necessary to establish and defend the fee claim." (Ketchum v. Moses, supra, 24 Cal.4th at p. 1141 [award should include fees expended defending underlying fee award].)
Finally, given plaintiffs legal entitlement, Enochs failed to sustain her burden of showing that the items on plaintiffs second and third memoranda of costs were not properly chargeable or were unreasonable: "`[I]f the items appear to be proper charges[,] the verified memorandum is prima facie evidence that the costs, expenses and services therein listed were necessarily incurred by the [prevailing party] [citations], and the burden of showing that an item is not properly chargeable or is unreasonable is upon the [objecting party]. [Citations.]" (Nelson v. Anderson (1999) 72 Cal.App.4th 111, 131, quoting Oak Grove School Dist. v. City Title Ins. Co. (1963) 217 Cal.App.2d 678, 698-699.)
But here, Enochs only argued that the fees associated with plaintiffs execution of the sanctions check in partial satisfaction of his judgment were not incurred to enforce the judgment but to avoid the sanctions payment. In light of the fact that execution of the check accomplished both purposes here and Enochs made no other arguments, Enochs therefore failed to sustain her burden of showing that the items on plaintiffs second and third memoranda of costs were not properly chargeable or were unreasonable.
Accordingly, there was no basis in law or fact for taxing plaintiffs second and third postjudgment memoranda of costs.
DISPOSITION
The postjudgment orders are reversed. This matter is remanded for further proceedings consistent with this opinion. Plaintiff is awarded his costs on appeal. (Cal. Rules of Court, rule 27(a).)
We concur: NICHOLSON, Acting P.J., ROBIE, J.