Hjelm v. Prometheus Real Estate Grp., Inc.

• Decision Date: 09 September 2016
• Docket Number: A142723
• Citation: 3 Cal.App.5th 1155,208 Cal.Rptr.3d 394
• Court: California Court of Appeals Court of Appeals
• Parties: Christie HJELM, et al. Plaintiffs and Respondents, v. PROMETHEUS REAL ESTATE GROUP, INC., Defendant and Appellant.

3 Cal.App.5th 1155

208 Cal.Rptr.3d 394

Christie HJELM, et al. Plaintiffs and Respondents,

v.PROMETHEUS REAL ESTATE GROUP, INC., Defendant and Appellant.

A142723

Court of Appeal, First District, Division 2, California.

Filed September 9, 2016

Ericksen Arbuthnot, Gregory A. Mase, Joseph Jonathan Minioza, Andrew J. Kozlow, Oakland, for Appellant.

Duckworth Peters Lebowitz Olivier, Monique Olivier, San Francisco, Brod Law Firm, Gregory Jay Brod, San Francisco, for Respondents.

Richman, J.Plaintiffs Christie and Justin Hjelm (when referred to collectively, the Hjelms) leased an apartment in a large complex from Prometheus Real Estate Group (Prometheus). Their apartment became infested with bedbugs, and the complex had an ongoing raw sewage problem, the upshot of which was that the Hjelms and their children were forced to leave. The Hjelms sued Prometheus, and a jury returned a verdict for them.

The trial court then awarded the Hjelms their attorney fees based on Civil Code section 1717. We affirm.

BACKGROUND

In May 2011, the Hjelms signed a residential lease agreement, renting apartment 1720A in the Chesapeake Point Apartments, San Mateo (the property). As Prometheus itself describes it, the Hjelms “entered into a one-year residential lease with Prometheus for the property....” The Hjelms signed the lease without any negotiation, indeed, while they were still out of state in their former home, the lease having been mailed to them.

The lease was a standard Prometheus-drafted lease. The basic agreement was seven pages long and, with various addenda, it totaled 24 pages. As discussed in detail below, the lease (and one addendum) had three provisions allowing Prometheus to recover attorney fees, all of them one-sided, allowing fees only to Prometheus.

In June 2011, the Hjelms moved into apartment 1720A. Fifteen months later, they moved out, their apartment plagued by a bedbug infestation that Prometheus failed to address, not to mention that there was raw sewage on the property.

In September 2012, the Hjelms filed suit against Prometheus. The operative first amended complaint (complaint) alleged seven causes of action, styled as follows: (1) negligence; (2) premises liability; (3) constructive eviction; (4) breach of warranty of habitability; (5) negligent infliction of emotional distress; (6) breach of the covenant of quiet enjoyment; and (7) nuisance. The complaint referred to Prometheus's duty under the lease to provide the Hjelms safe and habitable premises, illustrated, for example, by the cause of action for breach of the covenant of quiet enjoyment, which specifically alleged that “through the lease of the Premises, as well as implicit in Plaintiffs' tenancy,” the Hjelms were “entitled to quiet enjoyment of their tenancy as it is defined by Civil Code § 1927.” The prayer sought damages and among other things “attorney fees pursuant to contract and statute.”

Prometheus filed a general denial that included numerous affirmative defenses, some relevant only to contract claims, illustrated by the fifteenth, which alleged that “plaintiffs substantially and materially breached the contract complained of prior to commencement of this action, which conduct extinguishes the right to maintain the instant action.” The thirteenth affirmative defense alleged that the applicable statute of limitations were Code of Civil Procedure sections 337 (contract) and 337.2 (breach of written lease).

Prometheus filed two motions for summary adjudication on the issue of the Hjelms's entitlement to attorney fees. Both motions were denied, the trial court concluding that Civil Code section 1717 (section 1717 ) applied, to render the attorney fees provisions reciprocal should the Hjelms prevail at trial. Thus, for example, the second order held in pertinent part as follows: “While Defendant argues at length that the multiple attorney's fees provisions contained in the parties' written lease are applicable only in specific circumstances, Plaintiffs are correct in pointing out that these circumstances cover nearly every situation in which the landlord would be aggrieved. There is no reciprocal remedy for any situation in which the tenant is the injured party. [¶] The Court notes that Paragraph 30 of the lease, which contains an attorney's fee provision, contains this language: ‘Resident(s) shall further indemnify, defend and hold harmless Management from and against all claims arising from any breach of default in the performance of any obligation on Resident(s) part to be performed under the terms of the Rental Agreement.’ Such a one-sided attorney's fee provision is in violation of Civil Code § 1717(a). Trope v. Katz (1995) 11 Cal.4th 274, 285 [45 Cal.Rptr.2d 241, 902 P.2d 259].”

The case proceeded to jury trial, with the Honorable Joseph Bergeron presiding. Trial began on March 25, 2014, with testimony taken over eight days. On April 4, the jury returned a verdict for the Hjelms on all counts, awarding economic damage to the Hjelms in the amount of $11,652; non-economic damage to Christine Hjelm of $35,000; and non-economic damage to Justin Hjelm of $25,000. Prometheus did not ask for any clarification of the damages.

Judge Bergeron entered judgment on April 11, and the Hjelms gave notice of entry on April 14.

On April 25, Prometheus filed a notice of intention to move for new trial. Judge Bergeron denied it by order of June 12.

Meanwhile, on April 14, the Hjelms filed a motion for attorney fees. The original moving papers totaled some 76 pages, including a lengthy declaration and a supplemental declaration from the Hjelms's attorney supporting the amount sought. Prometheus filed lengthy opposition, and the Hjelms a reply. The motion came on for hearing on June 12, following which Judge Bergeron permitted Prometheus to file a supplemental brief concerning a new case it had cited at the hearing, addressing an issue of apportionment, a brief that was filed.

Meanwhile, following the June 12 hearing, three minute orders were entered that day. One denied a new trial. Another, that pertinent here, ordered that “Plaintiff's Motion for an Order, Awarding Reasonable Attorney's Fees ... [is] GRANTED. [¶] Amount of attorneys fees to be determined after further briefing by counsel.”

On June 30, Judge Bergeron filed two formal orders, one denying Prometheus's motion to tax costs, the other denying Prometheus's motion for new trial. He also filed a final judgment after verdict which, as pertinent here, recited that he “granted [the Hjelms's] motion for an order awarding reasonable attorney's fees in the amount of $326,475.00 The court finds that the amount of fees requested is reasonable. Therefore, [the Hjelms] are awarded $326,475.00 in attorney's fees.”

On August 11, Prometheus filed its notice of appeal.

DISCUSSION

Introduction

Prometheus has filed a 64–page appellant's opening brief. It has two arguments. The first, comprising some 70 percent of the argument, is that the attorney fee award “was incorrect and should be reversed.” The second is that the “underlying verdict should be reversed.” Since the second argument, if successful, would render the attorney fee award—and the first argument—moot, we begin with it. And conclude it cannot succeed—the appeal as to the verdict is untimely, not to mention premised on a factual representation in utter disregard of the rules of appellate procedure.

No Appeal of the Verdict Can Succeed

As noted above, judgment on the jury verdict was entered on April 11. Notice of entry was served on April 11 and filed on April 14. So, under the general rule, any appeal would have to be filed within sixty days. (Cal. Rules of Court, rule 8.104.) However, on April 25, Prometheus moved for a new trial. And, as noted, Judge Bergeron denied it by minute order of June 12. An order denying new trial was approved by Prometheus's counsel on June 24 and filed on June 30. Thus California Rules of Court, rule 8.108(b)(1)(B) governed the time to appeal: “If any party serves and files a valid notice of intention to move for a new trial, the following extensions of time apply: [¶] (1) If the motion for a new trial is denied, the time to appeal from the judgment is extended for all parties until the earliest of: [¶] (A) 30 days after the superior court clerk or a party serves an order denying the motion or a notice of entry of that order (rule 8.108, subd. (b)(1)(A) ); [¶] (B) 30 days after denial of the motion by operation of law (id. subd. (b)(1)(B)).” Thus, the time to appeal expired on July 30.

On June 30, Judge Bergeron also entered a new judgment that restated the denial of the motion for new trial and awarded the Hjelms attorney fees.

Prometheus filed its notice of appeal August 11. That appeal was timely to attack the attorney fee award. But not the verdict. And Judge Bergeron's second judgment does not help Prometheus.

Torres v. City of San Diego (2007) 154 Cal.App.4th 214, 64 Cal.Rptr.3d 495 (Torres ) is on point. And dispositive. There, city retirement board members obtained summary judgment on their claims the city had to pay for their defense in an action against them filed by the city attorney. The city filed a late notice of appeal, and the Court of Appeal dismissed it. The trial court later issued an order awarding attorney fees. The city appealed again, which appeal included an attack on the summary judgment. The Court of Appeal dismissed the appeal to the extent it concerned the summary judgment. Discussing the effect of a second judgment, the court began by noting that “ ‘The effect of an amended judgment on the appeal time period depends on whether the amendment substantially changes the judgment or, instead, simply corrects a clerical error.’ ” (Id. at p. 222, 64 Cal.Rptr.3d 495, quoting Eisenberg et al., Cal. Practice Guide: Civil Appeals & Writs (The Rutter Group 2006) ¶ 3:56, pp. 3–24 to 3–25.) And the court concluded, “It is well settled, however, that ‘[w]here the judgment is modified merely to add costs, attorney fees and...