Opinion
No. 2:12-CV-00795 JAM-CKD
09-20-2012
NORMAN SAFLEY and SUZANNE SAFLEY, Plaintiffs, v. WELLS FARGO, NA as successor in interest to WACHOVIA MORTGAGE and WORLD SAVINGS BANK, FSB; and DOES 1 through 50, inclusive, Defendants.
ORDER DENYING DEFENDANT'S MOTION
FOR ATTORNEYS' FEES
Presently before the Court is Defendant Wells Fargo, NA's ("Defendant") Motion for Attorneys' Fees (Doc. #24). Plaintiffs Norman and Suzanne Safley (collectively "Plaintiffs") oppose the motion (Doc. #26). Defendant replied (Doc. #27).
This motion was determined to be suitable for decision without oral argument. E.D. Cal. L.R. 230(g). The hearing was originally scheduled for September 5, 2012.
This litigation was brought by Plaintiffs to challenge the foreclosure sale of their home, obtain a mortgage loan modification pursuant to the federal Home Affordable Modification Program ("HAMP"), and obtain money damages stemming from the eight causes of action in their complaint. Defendant moved for dismissal of Plaintiffs' complaint (Doc. #5), but the Court dismissed the entire action on its own motion because Plaintiffs lacked standing (Doc. #20). Now Defendant seeks a finding that it was a "prevailing party" and thereby entitled to attorneys' fees in the amount of $9,368. Defendant contends that Cal. Civil Code § 1717 and Cal. Civil Procedure Code § 1032 authorize such an award based on the contractual fees provisions in the note and deed of trust. Plaintiffs respond that the Court dismissed the underlying action because they lacked standing without reaching the merits of their contract claims, precluding a finding that Defendant was the prevailing party.
Under California law, when a party to a contract dispute obtains a simple unqualified win in litigation, a court has no discretion to deny attorneys' fees pursuant to a valid contractual attorneys' fees clause under Cal. Civil Code § 1717. Jackson v. Homeowners Ass'n Monte Vista Estates-East, 113 Cal.Rptr.2d 363, 374 (Ct. App. 2001). But, "If neither party achieves a complete victory on all the contract claims, it is within the discretion of the trial court to determine which party prevailed on the contract or whether, on balance, neither party prevailed sufficiently to justify an award of attorney fees." Id. (quoting Scott Co. of Cal. v. Blount, Inc., 979 P.2d 974, 977 (Cal. 1999)).
In this case, Plaintiffs' position is more persuasive. The Court's order dismissing this case never reached the merits of Plaintiffs' contract claims, and the Court did not have jurisdiction over the contract claims due to Plaintiffs' lack of standing. The dismissal was also without prejudice, meaning that if Plaintiffs are able to resolve their standing problems, they are free to refile the lawsuit. Thus, Defendant did not achieve a simple unqualified win, leaving an award of attorneys' fees within the Court's discretion. Based on the foregoing, the Court finds that neither Plaintiffs nor Defendant were prevailing parties for purposes of attorneys' fees. Accordingly, Defendant's motion is DENIED. Defendant's Request for Judicial Notice (Doc. #25) is hereby vacated as moot.
IT IS SO ORDERED.
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JOHN A. MENDEZ,
UNITED STATES DISTRICT JUDGE