March 16, 2021
A recent Law 360 story by Kevin Penton, “Atty Who ‘Overlitigated’ Contractor Dispute See Fee Reduced,” reports that a California state appeals court has upheld a trial court awarding nearly $200,000 less in fees than what a lawyer sought for working on a dispute over an unlicensed contractor, finding that the lawyer representing himself in the matter "overlitigated" and got "embroil[ed]" in the case. A three-justice panel of the Second Appellate District upheld the trial court's "sound discretion" in rejecting David S. Karton's bid to collect $286,110 in attorney fees and awarding him $90,000 instead, according to the opinion. The court noted that when the dispute originated, the lawyer and Ari Design and Construction Inc. were $22,096 apart on how much the contractor owed him and his wife for a home construction job.
"In this appeal the Kartons have come out swinging, apparently believing the best defense is a good offense," the opinion reads. "This approach demonstrates the trial court was within its discretion to conclude the Kartons conducted litigation that was less than civil." Because California laws allow consumers to collect the entire amount they have paid a contractor who is unlicensed, Karton and his wife collected the entire $92,651 they had paid Ari by the time the lawyer learned in November 2015 that the contractor was not properly licensed or insured, according to the opinion. With other penalties, the judgment added up to $133,792, not including post-judgment interest and attorney fees, according to the opinion.
Karton then sought to collect on over 600 hours of work, which the trial court cut down to 200. The appellate court noted that Karton "overlitigated" and engaged in "incivility" in his briefing, through actions such as calling comments by his opposing counsel "frivolous" and alleging that they made false statements, according to the opinion. "The trial court fairly attributed some of the overlitigation to Karton's personal embroilment in the matter," read the opinion, which upheld the lower court's conclusion that it would "seem unreasonable" for an attorney fee award to total approximately three times the damages in the matter.
"A $23,000 argument must be resolved, but it does not justify launching a disproportionate litigation offensive," the opinion read. "The Kartons' strategy netted them windfall gains: the harshness of contractor licensing laws allowed them to recoup all their construction monies, plus $10,000, and to retain the benefit of months of free construction work."
Karton took issue with the appellate court describing as a "windfall" what he was statutorily entitled to, asserting that it is meant as a deterrent against workers who are injured on the job not having their medical bills paid. He told Law360 that during a settlement conference, he and his wife offered to settle the case for $125,000 — including attorney fees — but that Ari rebuffed them.