Unreported / Non-Citable
Background
This appeal arises from the dissolution of California's redevelopment agencies under Assembly Bills 1X 26 and 1484, collectively called the Dissolution Law. After the City of San Diego Redevelopment Agency was dissolved in 2012, the City became the successor agency and adopted a long-range property management plan retaining 22 properties for future development, conditioned on compensation agreements with the affected taxing entities. When the City failed to negotiate a master compensation agreement in mid-2016, it recategorized 10 properties for liquidation and sale, entered into compensation agreements for three others, and then took no further action on the remaining properties for years.
Seligman Liberty Station, LLC, which had acquired a ground leasehold interest in one of the retained future development properties in November 2018, petitioned for a writ of mandate in March 2022. Seligman alleged the City violated the Dissolution Law by retaining at least 26 properties it was legally required to sell and by failing to pursue compensation agreements or liquidation. The trial court issued a peremptory writ of mandate directing the City to exercise in good faith its discretion to either actively pursue compensation agreements or transfer the properties for liquidation, with returns due every 60 days; no party appealed that judgment.
Seligman then filed a postjudgment motion for attorney fees under Code of Civil Procedure section 1021.5, the common fund doctrine, and the substantial benefit theory, claiming $322,798.50. The trial court granted the motion in part under section 1021.5, finding Seligman had prevailed and enforced an important public right, but denied fees for time attorney Jeffrey Oderman spent working after going on inactive status with the State Bar and awarded only 25 percent of the requested fees, or $53,679.63, based on Seligman's limited success.
The Court’s Holding
The Court of Appeal affirmed the fee order. It first held that Seligman forfeited its challenge to the denial of fees for Oderman's post-inactive-status work because, at the hearing, Seligman's counsel expressly conceded the issue when the trial court asked whether the request was being withdrawn. Under the forfeiture rule, a party who fails to bring a deficiency or omission in a tentative ruling to the trial court's attention cannot raise it on appeal. The court likewise held that Seligman forfeited its argument that the trial court failed to address the common fund and substantial benefit theories, because Seligman did not raise that omission at the hearing.
On the merits of the reduction, the court explained that under section 1021.5 the lodestar method governs the fee amount, and the degree of a plaintiff's success is a crucial factor. Where claims are related, the trial court must compare the overall relief obtained with the hours reasonably expended and may reduce the lodestar when the relief is limited relative to the scope of the litigation. Because Seligman obtained none of the specific relief it sought in its petition — the remedy was fashioned from its catchall request for 'such other and further relief as the Court deems just and proper' — the trial court reasonably found limited success and could reduce the award; no abuse of discretion appeared.
The court also rejected the over-litigation challenge. The trial court's final ruling reduced fees based on limited success, not over-litigation; the over-litigation findings appeared only in the superseded tentative ruling. Even if the reduction had rested partly on over-litigation, the court explained, the findings — including Seligman's extensive description of properties whose development status it later conceded was irrelevant — were not an abuse of discretion.
Key Takeaways
- A party forfeits appellate review of an attorney fee ruling by expressly conceding the issue at the hearing or by failing to flag omissions in a tentative ruling.
- Under Code of Civil Procedure section 1021.5, a trial court may reduce a fee award for limited success even where the litigation enforced an important right affecting the public interest.
- A plaintiff achieves limited success, not excellent results, when it obtains none of the specific relief sought in its operative pleading.
- A fee reduction must rest on the final ruling's stated reasoning, not on findings in a tentative ruling that the final order superseded.
- An attorney's inactive status may bar recovery of fees for work performed while inactive, but the challenge must be preserved in the trial court.
Why It Matters
This unpublished decision reinforces the broad discretion trial courts have in setting section 1021.5 fees and confirms that even a prevailing party that confers a significant public benefit may receive a substantially reduced award when it did not obtain the specific relief it requested. It also underscores the forfeiture rule for arguments not raised below, and it leaves undisturbed the underlying peremptory writ directing the City to act on the retained future development properties.