Spahn v. Richards
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Plaintiffs purchased Berkeley property intending to demolish an existing structure and build a new residence. Richards, a licensed contractor, demolished the structure but did not build the new house. Plaintiffs sued Richards alleging breach of oral contract, breach of the implied covenant of good faith and fair dealing, and promissory estoppel. Richards propounded requests for admission (RFAs) asking the plaintiffs to admit the parties did not enter into an oral contract and did not have a meeting of the minds. Plaintiffs denied the RFAs.
The trial court denied Richards’s motion for summary judgment finding triable issues of material fact. After the close of evidence, Richards unsuccessfully moved for a directed verdict. The jury returned a defense verdict, concluding that Richards did not make a promise with clear and unambiguous terms. Richards moved for attorney fees and costs (Code of Civil Procedure 2033.420), arguing that the plaintiffs had no reasonable basis to deny the RFAs and “failed to realistically evaluate their claims and perform a reasonable investigation.” The court awarded Richards $239,170.86 in attorney fees and costs. The court of appeal affirmed. the trial court was well-positioned to evaluate the reasonableness issue as it presided over the case from start to finish. Neither the denial of summary judgment nor the denial of a directed verdict precluded the award.
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