Mossman v. Naranjo















Filed
9/18/12 Mossman v.
Naranjo CA4/1











NOT TO BE PUBLISHED IN OFFICIAL REPORTS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 This opinion has not been certified for
publication or ordered published for purposes of rule 8.1115>.





COURT OF APPEAL, FOURTH APPELLATE DISTRICT



DIVISION ONE



STATE OF CALIFORNIA






>

MICHAEL MOSSMAN et al., Plaintiffs and Respondents, v. JUAN C. NARANJO et al., Defendants and Appellants.

D059054 (Super. Ct. No. 37-2009-00064181- CU-BC-EC)

APPEAL from a judgment of the Superior
Court of San Diego
County, Laura W. Halgren, Judge. Affirmed.



Respondents Michael Mossman and Jasmine Mossman filed a
complaint alleging breach of contract,
intentional misrepresentation, negligent misrepresentation, and concealment
against appellants Juan C. Naranjo and Isabel Naranjo. A jury found in favor of the Mossmans on
their intentional misrepresentation, negligent misrepresentation and
concealment claims. Additionally, the
jury found clear and convincing evidence the Naranjos acted with malice, oppression and fraud. On the remaining cause of action for breach
of contract, the jury found in favor of the Naranjos. Both parties moved for attorney fees and the
trial court denied both motions.

On appeal the Naranjos contend they were the prevailing
party on the only contract claim in the action and were entitled to attorney
fees as a matter of law. They further contend they are entitled to
attorney fees without apportionment between fees incurred on the tort claims
and fees incurred on the breach of contract cause of action.

We affirm. The
standard real estate agreement which the parties signed permits the prevailing
party in actions "arising out of" the agreement to recover reasonable
attorney fees and costs. Both the
Mossmans' breach of contract and tort claims arose out of the real estate
agreement. Accordingly, in determining
whether the Naranjos were prevailing parties entitled to recover their attorney
fees, the trial court was required to consider the Mossmans' success on their
tort claims. In light of that success,
the Naranjos were not entitled to recover any attorney fees.

PROCEDURAL
AND FACTUAL BACKGROUND

The Mossmans purchased a home from the Naranjos. Prior to the sale the Mossmans observed water
damage and asked the Naranjos about it.
The Naranjos stated water intrusion occurred several years earlier but
repairs had been made and it was no longer a problem.

Five months after taking possession of the home, the
Mossmans' home suffered from incidents of severe water intrusion. The Mossmans later learned the water
intrusion was the result of improper and substandard grading adjacent to the
home. There was also no water proofing
on portions of a wall which was below grade.

After several attempts to resolve their concerns, the
Mossmans filed a complaint alleging breach of contract, intentional
misrepresentation, negligent misrepresentation and concealment. Following a trial the jury found for the
Mossmans on their intentional misrepresentation, negligent misrepresentation
and concealment causes of action and awarded the Mossmans $35,000 in
damages. However, the jury found the
Naranjos were not liable for breach of contract. Both parties filed motions for attorney fees
and both motions were denied.

The trial court denied the Naranjos' motion for attorney
fees because, although they had succeeded on the Mossmans' contract claim, the
Naranjos had not provided any apportionment of fees incurred on the contract
and tort claims. The court further found
the Mossmans' tort claims presented the predominant issues in the case and that
any attorney fees incurred on the breach of contract cause of action were
nominal.[1]

DISCUSSION

The Naranjos contend that because the jury found in their
favor for the breach of contract cause of action, they were the prevailing
party and, as such, were entitled to reasonable attorney fees. We disagree.

The parties' purchase agreement provides the prevailing
party in any litigation "arising out of" the agreement may recover
its attorney fees.[2] It is now well established such an attorney
fee provision permits recovery of fees incurred in prosecuting or defending
tort claims which arise out the agreement.
(Santisas v. Goodin (1998) 17
Cal.4th 599, 608 (Santisas); >Xuereb v. Marcus & Millichap,> Inc. (1992) 3 Cal.App.4th 1338,
1341.) "If a contractual attorney
fee provision is phrased broadly enough, as this one is, it may support an
award of attorney fees to the prevailing party in an action alleging both
contract and tort claims." (>Santisas, supra, 17 Cal.4th at p. 608.)

There is no dispute the Mossmans' tort claims arose out
of the purchase agreement and thus permitted recovery of fees incurred with
respect to those tort claims. (See >Xuereb v. Marcus & Millichap, Inc., >supra, 3 Cal.App.4ht at p. 1341.) Importantly where, as here, there is a broad
attorney fee provision and the parties' agreement does not otherwise define the
term "prevailing party," in litigation involving contract and tort
claims an award of attorney fees is left to a court's pragmatic determination
"of the extent to which each party has realized its litigation objectives,
whether by judgment, settlement, or otherwise." (See Santisas,
supra, 17 Cal.4th at p. 622.)
Contrary to the Naranjos' contention, this is not a case where the trial
court was limited to consideration of the outcome of the contract cause of
action.

The jury's verdict here provided the Mossmans with
virtually all of their litigation goals and little, if any, of the Narnajos'
goals. Thus there was no basis upon
which the trial court could find the Naranjos were the prevailing party within
the meaning of the parties' agreement. (>Ibid.)
Accordingly, the trial court did not error in denying the Naranjos'
motion.[3]

DISPOSITION

Judgment
affirmed.

Respondents to recover their costs of appeal.







BENKE, Acting P. J.



WE CONCUR:







HUFFMAN,
J.







AARON,
J.