Unpaid Wage Claim Results in Massive Attorneys' Fee Award

When a court opinion states “each side to bear its own costs on appeal,” it is no longer presumed that such wording prohibits an award of attorney fees on appeal after reviewing the Court of Appeals opinion in Stratton v. Beck, 30 Cal.App.5th 901 (2018).

Stratton was an appeal in an action for $303.55 in unpaid wages which, “transmogrified into a dispute concerning attorney fees totaling nearly 200 times that amount.” The trial court had affirmed a Labor Commissioner’s award and pursuant to statute, also awarded attorney fees to the plaintiff for prevailing in the trial de novo. The Court of Appeal affirmed the trial court’s award, in an opinion that ended with “[i]n the interest of justice, the parties are to bear their own costs of appeal.” The plaintiff then filed a motion for attorney fees for the appeal. The trial court awarded $57,420 in fees (which he sought to have doubled in light of the complexity of the matter) and the defendant appealed yet again. Defendant argued that since attorney fees are included as costs, and the Court of Appeal said each side would bear their own costs, then the plaintiff must have been precluded from obtaining attorney fees for the appeal too.

The Court of Appeal rejected that argument, pointing out that on appeal, “costs” are governed by Code of Civil Procedure section 1034, not sections 1032/1033.5. Those latter sections apply only to costs incurred at the trial court level. Section 1034 delegates the formulation of appellate costs to the Judicial Council. And, as Stratton pointed out, “Rule 8.278(d)(2) states that ‘Unless the [appellate] court orders otherwise, an award of costs neither includes attorney’s fees on appeal nor precludes a party from seeking them under rule 3.1702.’ The plain meaning of rule 8.278(d)(2) is that an award of costs in the court of appeal generally has no bearing on a party’s ability to seek appellate attorney fees in the trial court.

Employer Take-Away:

The take-away is that if there is basis for attorney fees at trial, then attorney fees will be available on appeal, and a Court of Appeal’s disposition of “costs” has nothing to do with attorney fees. At least, not unless the Court of Appeal’s opinion expressly addresses them.