Is Timing in Litigation a Priority to Consider?

Yes, timing in litigation is a priority that must always be considered because many statutes have due dates and deadlines that can cost significant money if parties do not comply.

In the recent appellate decision in Hatlevig v. General Motors, the failure of the plaintiff’s attorney to timely file his client’s motion for attorney’s fees precluded the client (and presumably the attorney who may have been representing the plaintiff under a contingency fee agreement) from collecting attorney’s fees from the “deep pocket” defendant General Motors LLC (GM). 

It may also have enabled GM to request attorney’s fees from plaintiff because GM prevailed in defense of the plaintiff’s appeal, and such an award may have offset the amount of the settlement paid to plaintiff. 

The decision allowed GM to request its costs on appeal, and the costs may also include GM’s attorney’s fees.

Matthew Hatlevig appealed the order denying the motion for attorney fees he filed after settling an action against GM for defects in a vehicle.

The trial court denied the motion as untimely. The appellate court affirmed the trial court’s judgment.

In February 2021, Hatlevig sued GM as the manufacturer of an allegedly defective vehicle he bought in 2017.

The parties reached a settlement by which Hatlevig agreed to surrender the vehicle and to dismiss the action and GM agreed to pay him $100,000.

The parties agreed Hatlevig was the prevailing party for purposes of attorney fees, and GM would pay Hatlevig the amount of fees determined by the trial court upon noticed motion.

Hatlevig’s counsel notified the trial court of the settlement at a trial readiness conference on June 2, 2023. The court took all pending matters off calendar and ordered a dismissal filed within 45 days.

At that time, the plaintiff’s attorney should have promptly filed and served his client’s motion for attorney’s fees.  There was no apparent reason to wait, and such a motion can be prepared and filed within a few hours. 

This illustrates the mistake of delaying action which may create the opportunity for a terrible consequence that could have been avoided by prompt action.

As phrased by U.S. Army General George S. Patton: “A good plan violently executed now is better than a perfect plan executed next week.”

On July 11, 2023, the clerk generated a “NOTICE OF DISMISSAL BY COURT,” which stated the “CASE [WOULD BE] DEEMED DISMISSED WITHOUT PREJUDICE ON 08/15/2023” unless a judgment or dismissal was filed or a party appeared ex parte and showed good cause why the case should not be dismissed.

The clerk mailed the notice to the parties on July 12, 2023.

Neither event specified in the notice occurred by August 15, 2023.

On August 31, 2023, Hatlevig filed a motion for attorney fees.

The trial court set a hearing for April 26, 2024. Hatlevig served the motion on GM on April 4, 2024.

GM opposed the motion.

Among other grounds, it argued the motion was untimely because it had not been served within 180 days of the date of settlement. (See Cal. Rules of Court, rules 3.1702(b)(1) [motion for attorney fees “must be served and filed within the time for filing a notice of appeal under 8.104 and 8.108”], 8.104(a)(1) [notice of appeal generally must be filed within earlier of 60 days of service of notice of entry of judgment or 180 days of entry of judgment].)

Hatlevig filed a reply in which he argued, among other points, that the motion was timely filed and served. He argued the 180-day deadline on which GM relied did not apply because the case had not been dismissed and no judgment had been entered.

The trial court held a hearing and denied the motion for attorney fees on April 26, 2024.

It agreed with GM that the motion was untimely. The court reasoned: “[T]his case was dismissed on August 15, 2023, since no cause was shown why it should not be ” and Hatlevig did not timely serve the motion on GM “[e]ven giving [him] the benefit of the full 180 days after that date.”

It rejected his argument that because there was no entry of judgment or dismissal, the deadline for filing the fee motion was never triggered.

The court noted acceptance of that argument would allow Hatlevig to extend the time to file a fee motion indefinitely by violating court orders to file a dismissal within 45 days or show cause why he has not done so.

Hatlevig appealed the denial order on May 2, 2024.

On June 17, 2024, the trial court signed a minute order stating: “The court was previously notified the case settled in its entirety. [¶] Case is dismissed. [¶] The court orders the Amended Complaint (SECOND), filed by plaintiff dismissed without prejudice.”

On appeal, Hatlevig raised a single claim: “The trial court erred in denying the [motion for attorney fees] because no dismissal had occurred and the time to appeal had not run at the time of the denial.”

Resolution of that claim of error required interpretation and application of rules of court to a set of undisputed facts, questions of law that the appellate court reviews de novo.

Rule 3.1702 of the California Rules of Court governs motions for attorney fees in civil cases.

A motion for fees incurred up to the time of judgment in the trial court “must be served and filed within the time for filing a notice of appeal under rules 8.104 and 8.108 in an unlimited civil case.” (Cal Rules of Court, rule 3.1702(b)(1), italics added.)

With exceptions not relevant to this appeal, the time for filing a notice of appeal is the earlier of 60 days after service of notice of entry of judgment or 180 days after entry of judgment.

A voluntary dismissal is effectively a judgment within the meaning of the rule prescribing the time to appeal.

Thus, the clock starts to run on the time to move for attorney fees from either the service of notice of entry of judgment or dismissal (starting a 60-day clock), or if no such notice is given, the entry of judgment or dismissal (starting a 180-day clock).

The main issue in dispute in this appeal was what event started the clock running. 

Hatlevig argued it was the entry on June 17, 2024, of the signed minute order that dismissed the operative complaint without prejudice. That order, he says, triggered the right to appeal and the corresponding time to move for attorney fees.

Hatlevig further argued the notice the clerk mailed to the parties stating the case would be deemed dismissed on August 15, 2023, was not appealable and thus did not start the clock on the time to file a notice of appeal or to move for attorney fees.

GM countered that an appealable order or judgment is not required to start the clock running on the time to serve and file a motion for attorney fees. That time, says GM, “was triggered by the conclusion of the litigation on the merits on August 15, 2023, when, pursuant to the trial court’s notice of dismissal, the case was deemed dismissed without prejudice.”

The appellate court concluded GM had the better argument.

Rule 3.1702 does not require an appealable order or judgment even though it uses “the time for filing a notice of appeal” to set the deadline for serving and filing a motion for attorney fees.

A voluntary dismissal, though not appealable, starts the clock running on the time to move for attorney fees when the dismissal concludes the litigation and triggers a right to fees.

The nonappealability of the dismissal the parties agreed to as part of the settlement therefore does not prevent use of the dismissal date as the date on which the time to move for attorney fees began to run.

The appellate court next had to determine the date of dismissal. With exceptions not relevant to this case, when a case settles the plaintiff “must serve and file a request for dismissal of the entire case within 45 days.”

If the plaintiff does not do so, “the court must dismiss the case 45 days after it receives notice of settlement unless good cause is shown why the case should not be dismissed.”

On June 2, 2023, Hatlevig’s counsel notified the trial court the case had settled, and the court ordered a dismissal filed within 45 days. Apparently to satisfy due process requirements, the clerk later mailed the parties notice the case would be deemed dismissed without prejudice on August 15, 2023, unless a dismissal was filed or a party showed good cause why the case should not be dismissed.

That date came and went, but no dismissal was filed and no good cause was shown why the case should not be dismissed.

Hence, consistent with the notice of dismissal, the case was dismissed without prejudice on August 15, 2023.

By filing the motion on August 31, 2023, Hatlevig implicitly acknowledged the case had been dismissed, because a dismissal or judgment in favor of the party seeking fees is a predicate to a fee award.

Hatlevig had at most 180 days after the dismissal to serve and file his motion.

One hundred eighty days after the dismissal was February 11, 2024.

Hatlevig filed his motion before that date (on Aug. 31, 2023), but he did not serve it until April 4, 2024, nearly two months after February 11, 2024.

The trial court therefore did not err in denying the motion as untimely.

The order denying the motion for attorney fees was affirmed and Respondent was entitled to costs on appeal.

LESSONS:

1.         Do not delay until tomorrow things of importance that can done today.

2.         The clock starts to run on the time to move for attorney fees from either the service of notice of entry of judgment or dismissal (starting a 60-day clock), or if no such notice is given, the entry of judgment or dismissal (starting a 180-day clock).

3.         A good plan violently executed now is better than a perfect plan executed next week.