Hunt v. Fahnestock

Opinion

GILBERT, J.

Here we hold that in a lawsuit involving several contracts, attorney’s fees pursuant to Civil Code

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section 1717 may be awarded to the prevailing party on each contract whether or not that party is a prevailing party in the lawsuit.

Plaintiff Robert J. Hunt appeals a judgment awarding attorney’s fees to defendants Joseph and Winona Fahnestock under section 1717. We affirm.

Facts

On February 25, 1985, defendants Joseph and Winona Fahnestock purchased real property on Calle Margarita in Thousand Oaks, California, from plaintiff Robert J. Hunt. The Fahnestocks assumed existing loans of $100,476.47 and executed two promissory notes to Hunt to complete the $129,576.47 purchase price. One promissory note for $15,000 was secured by a junior lien on the Margarita property, and another for $14,100 was secured by a junior lien on another piece of real property owned by the Fahnestocks on Calle Tulipán in Thousand Oaks.

Fourteen months later, the Fahnestocks defaulted on the two promissory notes to Hunt, as well as on the senior loans on the Margarita property. To protect his junior interest, Hunt advanced sums to pay the senior loans in default on the Margarita property. He then brought this action for judicial

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foreclosure and receivership against the Fahnestocks and the senior lien-holders on the Margarita and Tulipán properties.

Defendant Community Thrift & Loan (Community), the senior lienholder on the Tulipán property, brought a cross-complaint for indemnity against the Fahnestocks. This cross-action stems from covenants in the deed of trust between the Fahnestocks and Community.

Three months before trial, the Fahnestocks brought current the promissory note to Hunt secured by a trust deed on the Tulipán property. They also tendered to Hunt $200 in attorney’s fees in accordance with section 2924c, subdivision (d). Nevertheless, Hunt pursued judicial foreclosure of the Tulipán property. He contended that the Fahnestocks were liable for his actual attorney’s fees, as well as the sums advanced to pay senior obligations on the Margarita property. Hunt based this claim upon the future advance clause in the deeds of trust and upon the argument that the parties intended to secure each obligation to him with both deeds of trust.