Trials & Litigation

A 'disproportionate litigation offensive' in lawyer's remodeling dispute can justify lower fee, appeals court says

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A lawyer who successfully sued his home remodeling contractor isn't entitled to full attorney fees requested because of a trial judge’s finding that he had overlitigated the matter, a California appeals court ruled Tuesday.

The California Courts of Appeal’s Second Appellate District affirmed a finding that lawyer David Karton was entitled to $90,000 in attorney fees, rather than the $287,640 that he had sought, the Recorder reports.

“Trial judges deciding motions for attorney fees properly may consider whether the attorney seeking the fee has become personally embroiled and has, therefore, overlitigated the case,” the appeals court said in its March 9 opinion.

“Similarly, judges permissibly may consider whether an attorney’s incivility in litigation has affected the litigation costs.”

Karton had ordered Ari Design & Construction Inc. to stop work on his home in late 2015 after learning that the company was not properly licensed or insured. Karton and his wife had paid $92,651 for work valued at $57,555, the trial court found. But the couple was entitled to a refund of all the money they had paid, without any offset for work done, under a California law intended to encourage proper licensing.

A new trial judge on the case sought additional information on the Kartons’ attorney fee request, subject to a 10-page limit on text. The couple submitted 11 pages of text and around 300 pages of supplemental briefing with exhibits.

The trial judge said the supplemental briefing went “so far beyond what was necessary” and said in an order that it was “emblematic of the vast overlitigating of this matter.”

The judge also observed that the briefing was “replete with attacks on defense counsel” and noted its “inflammatory language” in the order.

The appeals court affirmed. The trial judge “had an ample basis to conclude the Kartons overlitigated this matter,” according to the appeals court. Although the legal dispute needed resolution, “it does not justify launching a disproportionate litigation offensive,” the appeals court said.

The appeals court also said the trial judge was justified in tying the fee request to the size of the judgment and in finding that the issues in the case were relatively simple.

In addition, the trial judge “had reason to conclude embroilment undermined objectivity about the appropriate scale of litigation,” the appeals court said. And the trial judge “correctly noted the incivility in Karton’s briefing,” the appeals court said.

“Excellent lawyers deserve higher fees, and excellent lawyers are civil. Sound logic and bitter experience support these points,” the appeals court said.

“Civility is an ethical component of professionalism. Civility is desirable in litigation, not only because it is ethically required for its own sake, but also because it is socially advantageous: It lowers the costs of dispute resolution. The American legal profession exists to help people resolve disputes cheaply, swiftly, fairly and justly. Incivility between counsel is sand in the gears.”

Karton told the ABA Journal that he is not sure whether he will appeal.

“I respectfully but very vigorously disagree” with the opinion, he said, but it can be difficult to persuade the California Supreme Court to hear a case.

Karton says the judge who heard his request for attorney fees was not the judge who heard the case, and he included exhibits in his supplemental briefing to bring the judge up to speed. The exhibits were no longer available because they had been returned to the litigants at the instruction of the prior judge.

Karton says he and his co-counsel racked up hours in the case partly because they had trouble obtaining requested discovery, requiring them to go to a discovery referee four times. They also defeated a motion for judgment on the pleadings, which the first judge rejected “almost without a blink,” Karton says.

Karton calls the incivility accusation “an unfounded conclusion” based on his reaction to the opposing counsel’s false allegation that Karton and his wife were guilty of witness tampering.

“That’s not an insignificant assertion,” Karton says, and of course he “came out swinging,” in the words of the appeals court. “What would you do if you’re accused of witness tampering?” he asks.

Karton says he never called the opposing counsel a liar in briefing. During oral arguments, Karton was asked whether he was calling the opposing counsel a liar, and Karton answered yes, he was calling the lawyer a liar of a sort.

There are no standards for determining incivility, Karton says, and it’s a very significant problem.

Karton says the corporation he sued is now defunct. As a result, he never received the $92,000-plus judgment for the money that he paid for remodeling work, nor did he receive a $10,000 penalty assessed against the company under California law. His remodeling project is, at this point, unfinished.

Karton says his attorney fees will be paid, however, by the company that posted a surety bond for Ari Design & Construction Inc., unless the bonding company appeals and wins in the California Supreme Court.

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