Procedural Posture

Complainant lessee and defendant broker filed cross-appeals to challenge the judgment of the Superior Court of Los Angeles County (California), which awarded damages to complainant for negligence and breach of fiduciary duty and denied complainant's request for attorneys' fees under a brokerage agreement and Cal. Civ. Code § 1717. Complainant invoked the policy of mutuality of remedy; defendant alleged the damage award was excessive.

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Overview

Complainant lessee and defendant broker entered into a brokerage agreement, which provided defendant was entitled to attorneys' fees for any legal action relating to the contract. Complainant filed a suit against defendant for negligence, breach of fiduciary duty, and breach of contract. The jury found in favor of complainant only on his negligence and breach of fiduciary duty claims and awarded damages, and both parties sought attorneys' fees under the agreement and Cal. Civ. Code § 1717. The trial court denied both requests, finding there was no prevailing party on the contract. Complainant appealed the denial of attorneys' fees, arguing that under the public policy of mutuality of remedy, unilateral attorneys' fees provisions should be enforced bilaterally; defendant challenged the damage award as excessive. On appeal, the court affirmed the denial of attorneys' fees; reversed and remanded as to the damage award; and held complainant was not entitled to attorneys' fees under the contract because it provided for attorneys' fees in tort actions relating to the contract only for defendant, or under § 1717 because it applied to attorneys' fees for contract actions, not tort claims.

Outcome

The court affirmed the denial of attorney's fees; reversed the award of damages to complainant lessee; remanded to the trial court to reduce the award; and held complainant was not entitled to attorneys' fees under the contract or the statute because the contract only provided attorneys' fees to defendant broker and the statute applied only to a contract action not a tort claim, and complainant did not prevail on his breach of contract action.