Standing in the shoes of a third party? Plan to pay the attorney fees.


In Apex LLC v., 2014 DJDAR 248 (2014), the California Court of Appeal for the Fourth Appellate District affirmed an attorney fee award rendered by the trial court. The court of appeal concluded that a third party who “stands in the shoes” of the contracting party can be liable for fees to the same extent as the original contracting party.

The plaintiff sued Sharing World Inc. (“SW”) and Felix & Sons Inc. (“Felix”), alleging the parties failed to pay for seed that it ordered. Felix later became (“Korusfood”). The trial court first ruled in favor of SW and Korusfood, but later reversed its ruling.

Following its appellate victory, Apex moved for contractual attorney fees. The defendants argued that Apex could not recover attorney fees from Korusfood, because Korusfood was separate from SW and was not a party to the contract. The trial court granted Apex’s request for attorney fees against both of the entities.

The court of appeal affirmed the trial court’s decision. The court held that even a party who has not signed an agreement may still be bound to an attorney fees provision in a contract if it “stands in the shoes of a party to the contract.” The nonsignatory party can be held liable for a fee award, if it would have been entitled to attorney fees as the prevailing party. This is a commonsense conclusion. Here, even though Korusfood was not a party to the contract, it stood in the shoes of Felix. Thus, the trial court correctly ordered both Korusfood and SW to pay Apex’s attorney fees.


Written by:

Published In:

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Hinshaw & Culbertson LLP | Attorney Advertising

Don't miss a thing! Build a custom news brief:

Read fresh new writing on compliance, cybersecurity, Dodd-Frank, whistleblowers, social media, hiring & firing, patent reform, the NLRB, Obamacare, the SEC…

…or whatever matters the most to you. Follow authors, firms, and topics on JD Supra.

Create your news brief now - it's free and easy »

All the intelligence you need, in one easy email:

Great! Your first step to building an email digest of JD Supra authors and topics. Log in with LinkedIn so we can start sending your digest...

Sign up for your custom alerts now, using LinkedIn ›

* With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name.