Mix v. Tumanjan Development Corp.

Opinion

In the published portion of this opinion, we hold

that an attorney representing himself or herself, who prevails in an action on a contract with an attorney fee provision, may recover reasonable attorney fees incurred for legal services of other attorneys who assist the pro se attorney in the prosecution or defense of the action, even if the assisting attorneys do not appear as attorneys of record in the action. We conclude the trial court properly awarded attorney fees. In the unpublished portion of this opinion we conclude substantial evidence supports the trial court’s finding the fees were incurred and the fees were not excessive. However, the trial court overlooked certain postjudgment attorney fees requested. We reverse and remand for a determination of those fees.

Facts and Procedural Background

In 1989, landlord Tumanjan Development Corporation (TDC) leased office space to Terence J. Mix, a personal injury attorney. The written lease agreement included an attorney fee provision: “If Tenant or Landlord shall bring any action for any relief . . . arising out of or under this Lease, including any suit by Landlord for the recovery of rent or possession of the Premises, the losing party shall pay the successful party its costs of suit or arbitration, including without limitation, a reasonable sum for attorneys’ fees in such suit or arbitration and such attorneys’ fees shall be deemed to have accrued on the commencement of such action and shall be paid whether or not such action is prosecuted to judgment.”

In 1995, Attorney Mix filed a complaint in propria persona against TDC for fraud, rescission, breach of contract, declaratory relief, and an accounting, alleging he had been overcharged for rent. Attorney Mix vacated the premises in 1996. TDC filed a complaint against Attorney Mix for breach of the written lease agreement. Attorney Mix filed an answer to TDC’s complaint in propria persona. The actions were consolidated for trial.

In April 1997, Attorney Mix retained the law firm of Allen, Matkins, Leek, Gamble & Mallory (Allen Matkins) to analyze legal and factual issues, help with trial strategy, and assist Attorney Mix in all aspects of the litigation, including trial preparation. Attorney Mix worked with Allen Matkins partner Charles Kenworthy and senior associate Adela Carrasco, both of whom have significant experience in real estate law. Allen Matkins did not formally associate in the litigation as counsel of record for Attorney Mix, except once for the limited purpose of filing a reply brief and presenting oral argument on a summary judgment motion.

During trial, Attorney Mix conducted the courtroom proceedings. Attorneys Kenworthy and Carrasco drafted motions in limine, researched legal

attorney fees. [Citations.] The Legislature codified the American rule in 1872 when it enacted Code of Civil Procedure section 1021, which states in pertinent part that ‘Except as attorney’s fees are specifically provided for by statute, the measure and mode of compensation of attorneys and counselors at law is left to the agreement, express or implied, of the parties. . . .’” (Trope v. Katz (1995) 11 Cal.4th 274 , 278-279 [ 45 Cal.Rptr.2d 241 , 902 P.2d 259 ].) “Although Code of Civil Procedure section 1021 gives individuals a rather broad right to ‘contract out’ of the American rule by executing such an agreement, these arrangements are subject to the restrictions and conditions of [Civil Code] section 1717 in cases to which that provision applies.” (Id. at p. 279.) “[Civil Code s]ection 1717, subdivision (a), provides in pertinent part that ‘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.’ ” (Ibid.) Civil Code section 1717 applies to both unilateral and reciprocal attorney fee provisions. (PLCM Group, Inc. v. Drexler (2000) 22 Cal.4th 1084 , 1091 [ 95 Cal.Rptr.2d 198 , 997 P.2d 511 ].)

An attorney who chooses to represent himself or herself, and does not pay or become liable to pay any sum out of pocket for legal services, may not recover reasonable attorney fees as compensation for the time and effort expended by the attorney and the professional business opportunities lost as a result. (Trope v. Katz, supra, 11 Cal.4th at p. 279.) An attorney litigating in propria persona does not “incur” compensation for the attorney’s time and lost business opportunities. (Id. at p. 280.) An attorney litigating in propria persona neither pays nor becomes liable to pay compensation or consideration in exchange for legal services. (Ibid.) To permit an attorney in propria persona to recover for the attorney’s time while not allowing a nonattomey in propria persona to recover for the nonattomey’s time would create disparate treatment of pro se litigants on the basis of their occupations; such disparate treatment would conflict with the legislative purpose of Civil Code section 1717. (Trope v. Katz, supra, 11 Cal.4th at p. 285.)

“[T]he term ‘attorney fees’ implies the existence of an attorney-client relationship, i.e., a party receiving professional services from a lawyer.” (PLCM Group, Inc. v. Drexler, supra, 22 Cal.4th at p. 1092 [in-house counsel].) The existence of an attorney-client relationship means that the attorney is not representing the attorney’s own personal interests. (Id. at p. 1093.) An attorney owes fiduciary and ethical obligations to a client. (Id. at p. 1094.) “ ‘ “Even a skilled lawyer who represents himself is at a disadvantage in contested litigation. Ethical considerations may make it inappropriate

for him to appear as a witness. He is deprived of the judgment of an independent third party in framing the theory of the case, evaluating alternative methods of presenting the evidence, cross-examining hostile witnesses, formulating legal arguments, and in making sure that reason, rather than emotion, dictates the proper tactical response to unforeseen developments in the courtroom.” ’ ” (Id. at p. 1092.)

An individual who elects to represent himself or herself may also retain counsel to assist in the prosecution or defense of the action. The retained attorney hired to assist a litigant in propria persona has an attorney-client relationship with the litigant and owes the litigant fiduciary and ethical obligations. Such a retained attorney serves the purposes of providing an independent third party’s judgment and a means of examination if the litigant is also a witness. “Legal counsel is just as necessary—perhaps more necessary—for the party who endeavors to represent himself, as it is for the person who has counsel of record. We certainly think it unwise to adopt a policy which would dissuade litigants from retaining attorneys to assist in lawsuits before the attorney appears with respect to filed documents.” (West Coast Development v. Reed (1992) 2 Cal.App.4th 693 , 706-707 [ 3 Cal.Rptr.2d 790 ] [Code Civ. Proc., § 128.5 sanctions]; accord, Dowling v. Zimmerman (2001) 85 Cal.App.4th 1400 , 1423-1425 [ 103 Cal.Rptr.2d 174 ] [Code Civ. Proc., §425.16, subd. (c) (SLAPP)].) If an attorney is in fact retained by the pro se litigant and renders legal services assisting in the lawsuit, the attorney need not be an attorney of record in order for the reasonable fees of the attorney to be awarded to a prevailing party. (West Coast Development v. Reed, supra, 2 Cal.App.4th at pp. 706-707.) Moreover, a rule permitting a litigant in propria persona to recover attorney fees for the legal services of assisting attorneys may be applied equally to both attorney and nonattomey pro se litigants.

It is not unusual for a litigant to be represented by more than one attorney. For example, a litigant may be represented by both privately retained counsel and in-house counsel. (See Garfield Bank v. Folb (1994) 25 Cal.App.4th 1804 , 1808-1809 [ 31 Cal.Rptr.2d 239 ], disapproved on other grounds in Trope v. Katz, supra, 11 Cal.4th at p. 292.) In those cases, a litigant entitled to an attorney fee award may recover attorney fees for both private counsel and in-house counsel, provided the legal services are not unnecessarily duplicative. (Ibid.)

In this case, Attorney Mix elected to represent himself in the prosecution and defense of the actions on the lease agreement. He is not entitled to nor does he seek compensation for the time he spent litigating the action. However, Attorney Mix retained Allen Matkins to perform legal

Disposition

The postjudgment order awarding attorney fees is reversed only to the extent the trial court failed to award any fees for the legal services of Allen Matkins rendered between January and May 2000. The matter is remanded to the trial court solely for determination of reasonable attorney fees for that period. Plaintiff and appellant Terence J. Mix is awarded his costs on appeal.

Armstrong, J., and Mosk, J., concurred.