Family Code section 271 allows the court in family law cases to award attorney fees and costs based on the extent to which a party’s or attorney’s conduct frustrates settlement and increases the cost of litigation. A Family Code section 271 award is in the nature of a sanction to deter misconduct and has been a powerful tool to encourage cooperation between the parties and attorneys and thereby reduce unnecessary litigation. However, the Court of Appeal recently issued a decision which limits what Family Code section 271 sanctions can be based on. The bottom line is that sanctions must be for attorney’s fees and costs only.
The following case example demonstrates how sanctions are adjusted to comply with the limits of Family Code section 271.
In Sagonowsky v. Kekoa, 1 Civ A142866/A143234, Div 5 (Jones), 2016 WL 7388386, the trial court awarded each party several properties in the divorce judgment and ordered the parties to effectuate title transfers by a certain date. Wife refused to execute deeds to the properties awarded to Husband and appealed the judgment. Wife’s appeal was ultimately dismissed, yet she still refused to execute the deeds and to withdraw the lis pendens she had recorded Husband’s other properties. Eventually, Husband filed a motion requesting the trial court to appoint the court clerk to execute the deeds and expunge the lis pendens, which was granted after several requests for continuances by Wife.
Husband subsequently filed a motion for Family Code section 271 sanctions in the amount of $776,732 based on Wife’s failure to cooperate in signing deeds to the properties awarded to Husband, refusal to withdraw her lis pendens, preventing Husband from selling one of the properties, forcing Husband to obtain the trial court’s assistance, and seeking numerous continuances for purposes of delay. The $776,732 requested consisted of about $200,000 in attorney’s fees and costs Husband had incurred, plus $180,000 for the reduced sale price of Husband’s property, and the rest as a sanction to prevent future misconduct. The trial court ordered Wife to pay sanctions of $86,000 for Husband’s attorney fees and costs, $180,000 for the reduced sale price of the property, and $500,000 for Wife’s “relentless and culpable conduct” in increasing litigation costs and purposefully frustrating settlement. Wife appealed.
The First District Court of Appeal ruled that the plain language of Family Code section 271 precludes a trial court from basing the amount of the sanctions award on anything other than attorney’s fees and costs, and therefore reduced the sanctions awarded by $680,000, finding that the $180,000 for reduction of sale price and $500,000 as punishment for deplorable conduct are not authorized sanctions under Family Code section 271 because they are not related to attorney’s fees and costs.