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Attorney's fees for Appeal
I do not think there is a good answer to this question because I have spent some time researching the issue and cannot find a satisfactory answer. I have successfully defended the Addendum to chapter 13 plan in an appeal. The creditor's basis for objecting to the Addendum was that it was a violation of RESPA, separation of power and that covenants 9 and 14 in the Note allowed them to charge fees to the debtors to protect their rights under the Note.
I filed a motion for attorney fees with the BAP for defending and prevailing on the appeal. I argued that based on the covenants 9 and 14 in the Note which each include attorney fee provisions and based on California Civil Code Section 1717, I am entitled to recovery of my fees since the creditor was trying to "enforce" its rights under the contract. However, the creditor responded that because the appeal had nothing to do with California law and that the appeal did not arise from a breach of contract California Civil Code Section 1717 does not apply.
Had the creditor prevailed in its appeal it would have added its attorney fees to the principal. In fact, a different creditor on a different case did in fact try to add all of the appeal fees to the principal on a different Addendum appeal case. We caught it and they removed the fees before completing the debtors loan modification.
Where does that leave my motion for fees? It's Friday, I cannot think clearly anymore.
Nancy B. Clark
Borowitz & Clark, LLP
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