Filed 6/20/25 Papageorges v. Dana Point Harbor Partners CA4/3
NOT TO BE PUBLISHED IN OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
FOURTH APPELLATE DISTRICT
DIVISION THREE
N. PAPAGEORGES, et al., Plaintiffs and Appellants, v.
DANA POINT HARBOR
PARTNERS, LLC,
Defendant and Respondent.
G063688
(Super. Ct. No. 30-2021-01222794)
O P I N I O N
Appeal from a postjudgment order of the Superior Court of Orange County, Lon F. Hurwitz, Judge. Affirmed. Lex Opus, Mohammed K. Ghods, Jeremy A. Rhyne, Lori L. Speak; Winters Law Firm and Dennis C. Winters for Plaintiffs and Appellants.
Cox, Castle & Nicholson, Alicia N. Vaz and Scott R. Laes for Defendant and Respondent.
* * *
1
This appeal stems from litigation concerning two contracts: Slip License Agreements (SLAs) and a Master Lease. Appellants Nick Papageorges, Donna Groves, and James Montrella (collectively, Tenants) and Respondent Dana Point Harbor Partners, LLC (DPHP) were parties to the SLAs. Although DPHP was a party to the Master Lease, Tenants were not but claimed they were third-party beneficiaries. The SLAs contained a prevailing party attorney fees clause; the Master Lease did not. Following a successful motion for summary judgment, DPHP sought recovery of its attorney fees incurred in defending the causes of action related to the SLAs and the Master Lease. The court granted the motion ruling Civil Code1section 1717 entitled DPHP to an award of attorney fees. The court tentatively concluded the SLA and Master Lease causes of action were so intertwined that no allocation was needed. However, following oral argument, the court's final ruling allocated DPHP's recovery of fees "50/50"
and reduced the award accordingly.
Tenants contend this was error because section 1717 limits the recovery of attorney fees to those incurred defending actions "on [the] contract" containing the attorney fee clause—here, the SLAs. They contend their action was not on the SLAs but was on the Master Lease. Because of this, they argue, the court not only erred in ruling DPHP was entitled to recover fees, but it erred in its allocation of those fees. We disagree with Tenants and their application of section 1717. DPHP's right to recover attorney fees is governed by the breadth of the language in the attorney fee clause in the SLAs, not section 1717. Because 1All further statutory references are to the Civil Code unless otherwise stated.
2
the SLA attorney fee clause is broad enough to give DPHP a right to recover its fees for work done in defending all causes of action, we affirm the award.
STATEMENT OF FACTS
DPHP operated the Dana Point Harbor pursuant to a Master Lease to which it and the City of Dana Point were parties. Pursuant to the Master Lease, DPHP was responsible for managing the boat slips in the Harbor. Tenants licensed boat slips from DPHP pursuant to the SLAs. The SLAs governed the "terms and conditions with respect to [the Tenants'] use and enjoyment of the slip." One of those conditions was the payment of a slip fee, which the SLA defined as the "sum for the leasing of the Slip." The SLA granted DPHP the right to "increase the Slip Fee and/or other fees at any time upon thirty (30) days [sic] notice to [Tenants]." The SLA contained an attorney fees clause: "In the event of litigation relating to the subject matter of this Agreement, the prevailing party shall be entitled to receive from the other party its reasonable attorneys' fees and costs."
Tenants filed a lawsuit against DPHP claiming it raised slip fees in violation of the Master Lease and the SLAs. Tenants contended they were third-party beneficiaries of the Master Lease and could take advantage of a provision which, they alleged, prohibited DPHP from raising slip fees in excess of the prevailing market rate.
The trial court granted DPHP's motion for summary judgment concluding the Tenants were not third-party beneficiaries of the Master Lease and the slip fees did not otherwise violate the SLAs. Following judgment in its favor, DPHP filed a motion for attorney fees. DPHP sought the recovery of all fees incurred in defending the lawsuit, even those incurred in defending the Master Lease causes of action. The court issued a tentative ruling granting the motion and awarding DPHP its reasonable fees and costs
3
in an amount of $365,651, which was "based on 100% of attorney and paralegal time being devoted to the SLA part of the work."
At oral argument, Tenants claimed since there were two contracts at issue (the SLA and the Master Lease), the court should apportion DPHP's recovery of its attorney fees between the work done on the SLAs, which was recoverable, and the work done on the Master Lease, which was not recoverable.
In its final ruling, the court granted DPHP's request for attorney fees but reduced the award from its tentative ruling by roughly 50 percent, apportioning the recoverable fees to those incurred in defending the SLA related causes of action. This reduction, we hold, was error, but because the ruling benefitted Tenants, they are not aggrieved by it and have no standing to pursue this appeal.
DISCUSSION
I.
THE SLA ENTITLED DPHP TO RECOVER
ALL ITS ATTORNEY FEES
'"[The] determination of the legal basis for an attorney fee award is a question of law to be reviewed de novo.'" (Mountain Air Enterprises, LLC
v. Sundowner Towers, LLC (2017) 3 Cal.5th 744, 751.) Tenants contend section 1717 governs the facts of this case.2It does not. 2"In any action on a contract, where the contract specifically provides that attorney's fees and costs, which are incurred to enforce that contract, shall be awarded either to one of the parties or to the prevailing party, then the party who is determined to be the party prevailing on the contract, whether he or she is the party specified in the contract or not, shall be entitled to reasonable attorney's fees in addition to other costs." (§ 1717, subd. (a).)
4
Section 1717 has limited application. It ensures that an attorney fee clause in a contract is mutual, and it defines who the prevailing party is for the purpose of recovering fees incurred in defending actions on that contract. (See Reynolds Metals Co. v. Alperson (1979) 25 Cal.3d 124, 128 (Reynolds Metals) [section 1717 establishes a "mutuality of remedy where [a] contractual provision makes recovery of attorney's fees available for only one party"]; § 1717, subd. (b) [the prevailing party is "the party who recovered a greater relief in the action on the contract"].)
Here, the attorney fee clause in the SLA is mutual and there is no dispute who the prevailing party is. Section 1717 is not relevant. Although the trial court relied on section 1717 as the basis for its decision, we must affirm if the court's ruling "is supported by any legal theory." (Hoover v. American Income Life Ins. Co. (2012) 206 Cal.App.4th 1193, 1201.) "If the decision itself is correct, there can be no prejudicial error from incorrect logic or reasoning." (Ibid.)
"[T]he 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; Yield Dynamics, Inc. v. TEA Systems Corp. (2007) 154 Cal.App.4th 547, 577 ["the scope of activities for which fees may be recovered is governed by the terms of the [SLAs]"].) Therefore, the law entitles DPHP to recover its fees incurred in "litigation relating to the subject matter of [the SLAs] . . . . "
Here, the SLA's "subject matter" includes the "terms and conditions with respect to [the Tenants'] license, use and enjoyment of the slip." One of those conditions is the slip fee. The SLA gives DPHP an unrestricted right to "increase the Slip Fee . . . at any time upon thirty (30) days [sic] notice to [Tenants]." Litigation aimed at restricting this right—
5
whether under the SLAs or the Master Lease—is related to the subject matter of the SLAs.
II.
THERE IS SUBSTANTIAL EVIDENCE
THE TENANTS SIGNED THE SLAS
Alternatively, Tenants contend "DPHP failed to present the court with a signed SLA for each of the Tenants" and so DPHP did not prove there was an agreement between the parties which awarded attorney fees. We disagree.
In its statement of facts supporting its motion for summary judgment, DPHP claimed the "boat slips at the Harbor are licensed to the individuals pursuant to SLAs" and referenced an SLA included as an exhibit. In response, Tenants "[a]dmit[ted] there are SLA's [sic]" and stated the SLA
"speaks for itself." In addition, the Tenants testified the SLA containing the fee provision appeared to be what they signed.
We need not review the evidence Tenants contend disputes the above nor need we consider conflicting inferences Tenants ask us to draw.
"We review the trial court's factfinding for substantial evidence. This traditional standard of review is highly deferential. It has three pillars. First, we accept all evidence supporting the trial court's order. Second, we completely disregard contrary evidence. Third, we draw all reasonable inferences to affirm the trial court." (Schmidt v. Superior Court (2020) 44 Cal.App.5th 570, 581.)
6
III.
TENANTS DO NOT HAVE STANDING TO
CHALLENGE THE COURT'S APPORTIONMENT OF FEES Next, Tenants argue the court erred "by failing to apportion the fees properly." They claim that "[g]iven the very limited role the SLAs played in the litigation," the court should have awarded only 5 percent of DPHP's requested fees. We agree the trial court erred in its 50/50 apportionment, but this error benefited Tenants and, thus, they do not have standing to appeal the issue.
We first address Tenants' contention that "[w]here multiple, independent contracts are at issue, attorneys' fees 'must be determined as to each contract.'" They base this argument on Arntz Contracting Co. v. St. Paul Fire & Marine Ins. Co. (1996) 47 Cal.App.4th 464 (Arntz) and Reynolds Metals, supra, 25 Cal.3d 124. Those cases do not apply here. In Arntz, supra, the issue was how to determine the prevailing party when there are multiple contracts with their own attorney fee clauses. (Arntz, supra, 47 Cal.App.4th at p. 491.) Arntz held "[w]hen an action involves multiple, independent contracts, each of which provides for attorney fees, the prevailing party for purposes of Civil Code section 1717 must be determined as to each contract regardless of who prevails in the overall action." (Ibid.) Here, there is no dispute that DPHP is the prevailing party. In Reynolds Metals, supra, the court held section 1717 "provide[s] a reciprocal remedy for a nonsignatory defendant, sued on a contract as if he were a party to it, when a plaintiff would clearly be entitled to attorney's fees should he prevail in enforcing the contractual obligation against the defendant." (Reynolds Metals, supra, 25 Cal.3d at p. 128.) Here, DPHP is
7
seeking the recovery of fees based on a contract of which they were a signatory.
As we discussed, DPHP was entitled to recover all of its attorney fees incurred in defending the action—whether related to the SLA or the Master Lease. The trial court erred in apportioning the recoverable fees and declining to award DPHP its fees incurred in defending the Master Lease causes of action. However, this error benefited Tenants, as DPHP was limited to recovery of roughly 50% of its reasonable attorney fees, as determined by the trial court.
"An appeal may be taken only by a party who has standing to appeal. [Citation.] This rule is jurisdictional. [Citation.] Only a party who is aggrieved has standing to appeal. [Citation.] A party is aggrieved only if its 'rights or interests are so injuriously affected by the judgment.'" (Sabi v. Sterling (2010) 183 Cal.App.4th 916, 947.)
Here, although the court erred in its allocation, that error was in Tenants' favor and, "[s]ince [they were] not prejudiced by the error and [DPHP] did not appeal, reversal of [that] portion of the judgment is unwarranted." (In re Marriage of Moore (1980) 28 Cal.3d 366, 374.)
IV.
THERE IS NO CHILLING EFFECT
ON PUBLIC INTEREST LITIGATION
Last, Tenants argue awarding DPHP its attorney fees would
8
position—Christiansburg Garment Co. v. EEOC (1978) 434 U.S. 412 (Christiansburg) and Travis v. Brand (2023) 14 Cal.5th 411 (Travis). However, both decisions dealt with the award of attorney fees pursuant to statutes which gave the trial court discretion to decide whether to award fees. (Christiansburg, supra, 434 U.S. at p. 416 [Civil Rights Act of 1964 allowing attorney fees in the court's discretion]; Travis, supra, 14 Cal.5th at p. 414 [Political Reform Act allowing attorney fees in the court's discretion].) There is no such statute or discretion at issue here.
DISPOSITION
The postjudgment order awarding attorney fees is affirmed. DPHP to recover its costs incurred on appeal.
SANCHEZ, ACTING P. J.
WE CONCUR:
MOTOIKE, J.
GOODING, J.
9