Shannon v. Northern Counties Title Insurance

ELKINGTON, J.

This appeal is taken from that portion of a judgment which awarded appellants (defendants and cross-complainants below) $500 as the reasonable value of attorney fees to which they were entitled, The only issue before us is whether the award was so insufficient as to constitute an abuse of the trial court’s discretion.

The proceedings below arose out of a real estate transaction taking place in 1958. At that time, appellant John Barbagelata, a licensed real estate broker, in order to facilitate the purchase by respondents of certain San Francisco real property, loaned them the sum of $1,500, at the same time taking back a promissory note secured by a third deed of trust on the subject property. Both the promissory note and the deed of trust contained language obligating respondents to pay the reasonable value of attorney fees necessarily incurred in the collection of the note or in protecting the security therefor.

Respondents made no payments on the note for three years, as a result of which appellants commenced foreclosure proceedings. Shortly before a scheduled trustee sale of the sub

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ject property, respondents instituted this action by filing a complaint in the superior court alleging that they were induced to purchase the property and sign the note by false representations of John Barbagelata and praying for a temporary injunction restraining appellants from foreclosing on the property or transferring the note, general and punitive damages in the sum of $50,000, and cancellation of the note. By way of answer appellants denied the allegations of fraud and set up a cross-complaint for judgment on the note and reasonable attorney fees.

Upon motion of the respondents, trial of the matter was consolidated with two other pending actions against the seller of the subject property and termite control operators who were alleged to have participated in the fraud. The action against the sellers was eliminated on a motion for summary judgment, and a jury trial of the two remaining actions commenced November 9, 1966.

Respondents took 16% days to put on their ease, during all of which time Robert D. Barbagelata, as attorney for appellants, actively participated in the trial. On the last day of respondents’ case, on motion of appellants, the court granted a nonsuit. On February 1, 1967, the court, without a jury, considered the matter of the cross-complaint, and admitted into evidence a declaration of appellants’ attorney which itemized time and charges adding up to $9,153.75 in attorney fees. Thereafter the court entered judgment in favor of appellants for the full amount of the note plus interest, and $500 as reasonable attorney fees.