Under California law, an award of attorney’s fees is typically not available to a prevailing party at trial. The most common exceptions to this rule are statutes authorizing recovery of attorney’s fees for particular actions and contracts authorizing recovery of attorney’s fees in breach of contract actions. However, in personal injury lawsuits, the loser typically does not pay the winner’s attorney’s fees.
A rather obscure provision in the discovery sections of the Code of Civil Procedure can provide a back door for recovery of attorney’s fees, including in personal injury cases. The provision is Civil Code Section 2033.420, dealing with a party’s failure to admit the truth of a matter when requested to do so in a pre-trial Request for Admission.
Under CCP 2033.420, if a party fails to admit the truth of a relevant matter, thus forcing the other side to prove the truth of the matter at trial, the party requesting the admission may obtain a court order requiring the non-admitting party to pay the reasonable expenses incurred in making that proof at trial, including reasonable attorney’s fees. The court may award such fees unless it finds that the non-admitting party “had reasonable grounds to believe that party would prevail on the matter.” Both plaintiff and defense attorneys should be aware of this provision, in particular, those defense counsel who refuse to admit liability even when it is staring them in the face.
A recent Court of Appeals case, Grace v. Mansourian, illustrates this point nicely. Mr. Mansourian, the defendant, drove his car into an intersection and struck a car driven by Mr. Grace, the plaintiff. Mr. Mansourian told the responding police officer the light was yellow when he entered the intersection. An eyewitness, Ms. Napoli, told the police officer the light was red. She made this statement in the presence of Mr. Mansourian, who responded, “I ran a red light?” Ms. Napoli said, “Yes, you did.” Mr. Mansourian did not reply. This conversation was included in the responding police officer’s report, who found Mr. Mansourian at fault for the accident.
Mr. Grace sued Mr. Mansourian for the personal injuries he sustained in the accident. His attorney served Requests for Admissions upon Mr. Mansourian requesting Mr. Mansourian to admit 1) that he ran the red light, 2) that he was negligent in doing so, and 3) that his negligent conduct caused Mr. Grace’s injuries. Mr. Mansourian denied all three Requests for Admission.
At trial, Mr. Mansourian’s attorney told the jury the case was one of credibility. If they believed Mr. Mansourian’s testimony that the light was yellow when he entered the intersection, they should find him not negligent. However, if they believed Ms. Napoli’s testimony that the light was red, they should find him negligent.
The plaintiffs called the plaintiff, the eyewitness, the investigating officer, and an accident reconstruction expert to prove their side of the case, i.e. that Mr. Mansourian ran a red light. The defense did not designate a liability expert. Instead, they merely put Mr. Mansourian on the stand to repeat his claim that the light was yellow when he entered the intersection. The jury did not believe him. They found him liable.
After trial, Mr. Grace’s attorneys moved the court for an award of attorney’s fees under CCP 2033.420, arguing that Mansourian had no reasonable basis to refuse to admit that the light was red or that he was negligent. They sought over $170,000 for the attorney’s fees Mr. Grace subsequently incurred in having to prove these two facts at trial.
The trial court refused to award attorney’s fees to the plaintiff. It held that Mr. Mansourian had the right to have a jury decide his claim that the light was yellow.
On appeal, the trial court’s ruling was reversed and the case remanded with instructions that Mr. Grace be awarded the amount of attorney’s fees and other expenses he incurred because of Mr. Mansourian’s wrongful refusal to admit he ran the red light and to admit he was negligent. According to the Court of Appeals, the evidence against Mr. Mansourian was overwhelming. There was not simply Ms. Napoli’s eyewitness testimony, but also that of the accident reconstruction expert and the investigating police officer.
The court stated that it is not sufficient grounds to deny a request for admissions to merely have “some evidence” to contest an issue. Rather, the defendant must reasonably believe he will prevail on the issue at trial. Otherwise, he is simply wasting the court resources and the jury’s time, which is exactly what Requests for Admission are designed to prevent. A good faith belief means, it said, “more than a hope or a roll of the dice.”
The lesson to be learned from this case for a defense practitioner is to be objective in evaluating liability. If your case is a pure loser, refusing to admit liability can cost your client attorney’s fees on top of all other recoverable damages, often doubling or even tripling the client’s ultimate exposure.
Paul T. McBride is a Partner with Kring & Chung, LLP‘s Sacramento, CA office. He can be reached at (916) 266-9000 or [email protected].