LOS ANGELES (Legal Newsline) – A Lemon Law defendant will have to pay almost $170,000 to plaintiffs attorney despite the client only recovering $22,000.
The California Second Appellate District on Jan. 29 approved the windfall for attorneys at Rosner, Barry & Babbit in a lawsuit against HNL Automotive, which is accused of selling a defective “Certified Pre-Owned” 2015 Nissan Altima, and TD Auto Finance.
Though it was advertised as having cruise control and power-adjustable seats, plaintiff Tania Pulliam, who is disabled and relies on those features, said it did not. She sued the company in 2016, two months after buying it.
A jury in 2018 returned a verdict in favor of Pulliam on only one of her four causes of action – violation of the implied warranty of merchantability under the Song-Beverly Consumer Warranty Act.
The jury award Pulliam $21,957.25 but left blank the amount of costs, attorneys fees and prejudgment interest. Pulliam’s lawyers sought $169,602, which consisted of a lodestar figure of $141,335 plus a .2 multiplier.
The motion for fees said TD Auto Finance was liable for paying them. It was approved by the trial judge in Los Angeles, and Justice Laurence Rubin said substantial evidence supported the lodestar amount.
“Defendants offer no authority to suggest that further evidence is needed to establish market rates in the community,” Rubin wrote. “The evidence was sufficient for the trial court which also observed that it was capable of assessing market rates in the community sua sponte.”
TD also claimed the so-called Holder Rule limited its liability for attorneys fees to just what Pulliam paid under the retail sales installment contract, but Pulliam said that limit only applied to compensatory damages.
In wading through conflicting decisions, Rubin determined the cap does not apply attorneys fees.
“One commentator suggested that if the creditor is not responsible for attorney fees and costs, there would be an incentive to intentionally prolong litigation and cause a consumer to spend more prosecuting the case than the recovery available under the sales contract,” Rubin wrote.
“Both consumer rights and the rule’s purpose would be frustrated if attorney fees were not recoverable from both the seller and the creditor-assignee.”