# Fees and Costs — California (CCP §§ 1021, 1032, 1033.5 + Fee-Shifting Statutes)

California follows the **American Rule** as its baseline: each
party bears its own attorney fees unless authorized by statute,
contract, or other specific legal authority. *Trope v. Katz*
(1995) 11 Cal.4th 274, 278.

This reference catalogs the most common bases for fee and cost
recovery in California civil practice and the procedure for
claiming them.

> **NOT LEGAL ADVICE.** Always verify the current CCP and
> applicable statutes — California fee-shifting provisions have
> been amended frequently.

## Cost recovery — the prevailing-party framework

### CCP § 1032 — Who recovers costs

The prevailing party is entitled to costs as a matter of right
in the following circumstances:

- **(a)(4)** "Prevailing party" includes: the party with a net
  monetary recovery; a defendant in whose favor a dismissal is
  entered; a defendant where neither plaintiff nor defendant
  obtains a judgment; or the party the court designates as
  prevailing party when there is no clear prevailing party
- **(b)** The prevailing party is entitled to recover costs
  unless another statute provides otherwise

Costs are claimed by filing a **memorandum of costs** (Form
MC-010) within **15 days after the date of service of notice
of entry of judgment or dismissal, or within 180 days after
entry of judgment** (CRC 3.1700(a)).

### CCP § 1033.5 — Allowable and non-allowable costs

**(a) Allowable costs** include:

- Filing, motion, and jury fees
- Fees for service of process
- Fees of a certified court reporter for transcript of court
  proceedings necessarily obtained for use in the case
- Fees for depositions as follows: (A) fees of the deponent
  for attendance; (B) fees for certified transcript of the
  deposition necessarily obtained for use in the case
- Fees for original and one copy of transcript of court
  reporter's notes
- Expert witness fees ordered by the court (note: expert fees
  are not recoverable as a matter of right unless court-ordered
  under CCP § 998 or by statute)
- Service of process fees and witness fees (CCP § 1033.5(a)(3))
- Interpreter fees
- Models, blowups, and photocopies of exhibits reasonably
  necessary to aid in visual presentation to the trier of fact
- Fees for electronic filing or service
- Court-ordered mediation fees

**(b) Non-allowable costs**:

- Fees of experts not ordered by the court (general rule)
- Investigation expenses
- Postage, telephone, and photocopying charges (unless a
  specific statute authorizes)
- Attorney fees not required to be awarded by statute or
  contract
- General office overhead

**(c)** The court has discretion to award or deny costs when
not clearly included or excluded in subdivisions (a) or (b).

### CRC 3.1700 — Procedure for claiming costs

- **File Form MC-010** (Memorandum of Costs) within 15 days
  after service of notice of entry of judgment or dismissal;
  alternatively within 180 days of entry of judgment
- **Motion to tax costs**: opposing party must move to strike
  or tax any or all of the costs claimed within **15 days**
  after service of the memorandum of costs (CRC 3.1700(b))
- If no motion to tax is filed, the clerk enters the costs
  as claimed

The memorandum of costs must be verified and must contain
an itemized statement of costs. If challenged, the claiming
party bears the burden of establishing the costs were
necessary and reasonable.

## Attorney fee-shifting

### 1. Contractual fee-shifting — Civ. Code § 1717

**Cal. Civ. Code § 1717** is the most frequently invoked
California fee-shifting provision in civil debt and contract
cases.

- In any action on a contract that contains an attorney fee
  clause, the **prevailing party** on the contract is entitled
  to reasonable attorney fees in addition to costs
- **Reciprocity**: if the contract provides fees only to one
  party (e.g., a lender), § 1717 makes the clause reciprocal —
  the party prevailing on the contract, whether or not the
  named beneficiary of the clause, recovers fees
- The fee must be reasonable; the lodestar is the starting
  point (see below)
- The right to fees under § 1717 applies even if the action is
  defeated by rescission, impossibility, or the statute of
  frauds

**Key rule**: The prevailing party on the contract is the one
who prevailed "on a practical level" — e.g., a defendant who
obtains dismissal with prejudice is the prevailing party even
if no money judgment was entered.

Many credit card agreements, consumer loan contracts, and
lease agreements contain one-sided fee clauses. When the
consumer defendant prevails, § 1717 entitles the consumer to
fees under the clause.

### 2. Private attorney general — CCP § 1021.5

**Code Civ. Proc., § 1021.5** authorizes attorney fees when:

- The action results in the enforcement of an important right
  affecting the public interest
- A significant benefit has been conferred on the general public
  or a large class of persons
- The necessity and financial burden of private enforcement make
  a fee award appropriate
- The fees should not in the interest of justice be paid out of
  the recovery

§ 1021.5 is most commonly invoked in public-interest litigation,
consumer protection class actions, and environmental law. It is
available to successful plaintiffs and, less commonly, to
successful defendants who have vindicated an important public
right.

### 3. Settlement offer — CCP § 998

**Code Civ. Proc., § 998** creates powerful cost-shifting
incentives around settlement:

- Either party may serve an offer to compromise
- If the plaintiff rejects a defendant's § 998 offer and fails
  to obtain a more favorable judgment, the plaintiff must pay
  the defendant's costs (including expert witness fees) from the
  date of the offer through trial
- Reciprocally: if the defendant rejects a plaintiff's § 998
  offer and the plaintiff obtains a judgment more favorable
  than the offer, the plaintiff recovers post-offer costs
  including expert fees

**§ 998 expert fees** are the most significant cost element —
a rejected § 998 offer can shift tens of thousands of dollars
in expert costs to the rejecting party. Evaluate all § 998
offers carefully.

### 4. Consumer protection fee-shifting statutes

- **Civ. Code, § 1780(e)** — CLRA: court shall award attorney
  fees to a prevailing plaintiff; may award fees to defendant
  if the action was frivolous
- **Bus. & Prof. Code, § 17200** et seq. (UCL): injunctive
  relief available but no attorney fees to a prevailing
  plaintiff under the UCL itself; may recover fees under
  § 1021.5 in a public-interest case
- **15 U.S.C. § 1692k(a)(3)** — FDCPA: prevailing consumer
  is entitled to attorney fees from the debt collector; fees
  against the consumer only if the action was brought in bad
  faith
- **Civ. Code, § 1788.30(c)** — Rosenthal Act: prevailing
  debtor entitled to attorney fees and costs

### 5. Discovery sanctions — CCP § 2023.030

The court may award monetary sanctions (including attorney fees)
against any party or attorney who misuses the discovery
process (CCP § 2023.010). A successful motion to compel
entitles the moving party to seek monetary sanctions unless
the opposing party's failure was "substantially justified"
(CCP §§ 2030.300(d), 2031.310(h), 2033.290(d)).

The sanctions standard in California parallels Oregon (ORCP
46 A(4)(a)) and federal law (FRCP 37(a)(5)) — mandatory
unless substantially justified.

## Calculation: the lodestar method

When attorney fees are awarded, California applies the
**lodestar** method:

- **Hours reasonably expended** × **reasonable hourly rate** =
  lodestar
- The lodestar may be adjusted upward or downward based on
  factors not already reflected in the lodestar calculation

*PLCM Group v. Drexler* (2000) 22 Cal.4th 1084 is the leading
California case on lodestar calculation.

### Factors considered (based on *Serrano v. Priest* (1977)
20 Cal.3d 25 and California Rules of Professional Conduct)

- Time and labor required
- Novelty and difficulty of the questions involved
- Skill required to perform the legal service properly
- Preclusion of other employment due to accepting the case
- Customary fee in the community for similar services
- Whether the fee is fixed or contingent
- Time limitations imposed by the client or circumstances
- Amount involved and results obtained
- Experience, reputation, and ability of the attorneys
- Undesirability of the case
- Nature and length of the professional relationship
- Awards in similar cases

### Multiplier

After calculating the lodestar, the court may apply a
**multiplier** to reflect factors not already accounted for,
such as the risk of nonpayment in a contingency case or
exceptional results. *Ketchum v. Moses* (2001) 24 Cal.4th 1122.
A multiplier greater than 1 is discretionary and must be
justified.

## Pro se fee recovery

A self-represented litigant **cannot** recover attorney fees
for their own time as "attorney fees." However:

- A pro se litigant **can** recover **costs** under CCP § 1032
- A pro se litigant **can** recover costs under CCP § 1033.5
- If the pro se later retains counsel, fees for counsel's time
  are recoverable
- A pro se attorney-litigant may recover fees in limited
  circumstances (contested; verify current law)

## Sample memorandum of costs language

```
MEMORANDUM OF COSTS (SUMMARY)
(Use California Judicial Council Form MC-010)

Plaintiff/Defendant [name] is the prevailing party [in
the judgment entered on [date]] and claims the following
costs:

1. Filing and motion fees:            $[amount]
2. Jury fees:                         $[amount]
3. Service of process:                $[amount]
4. Deposition costs:                  $[amount]
5. Expert witness fees (court-ordered,
   per CCP § 998):                    $[amount]
6. [Other allowable items per
   CCP § 1033.5(a)]:                  $[amount]

TOTAL:                                $[amount]

I declare under penalty of perjury under the laws of the
State of California that the foregoing costs are correct
and have been necessarily incurred in this action.

Date: ______________  Signed: _________________________
                              [Party / Attorney of Record]
```

## Common cost-claim pitfalls

| Pitfall | Consequence |
|---------|-------------|
| Missing the 15-day MC-010 deadline | Costs waived |
| Claiming non-allowable costs (postage, photocopies) | Taxed off |
| No itemization of deposition costs | Objected, may be disallowed |
| Expert fees without § 998 offer or court order | Not allowable |
| Block-billing in fee motion without task detail | Court may reduce |
| No supporting declaration for lodestar | Fee motion denied or reduced |

## Comparison to Oregon and Washington

| Concept | California | Oregon | Washington |
|---------|-----------|--------|------------|
| American Rule baseline | Yes | Yes | Yes |
| Cost memorandum procedure | CRC 3.1700 (15 days, MC-010) | ORCP 68 C(2) (14 days) | KCLCR 7(b)(11) |
| Reciprocal contract fees | Civ. Code § 1717 | ORS 20.096 | RCW 4.84.330 |
| Private attorney general | CCP § 1021.5 | ORS 20.105 (different standard) | RCW 4.84.250 (limited) |
| Settlement offer cost-shift | CCP § 998 (expert costs) | None equivalent | CR 68 (limited) |
| Lodestar authority | PLCM Group (2000) | Strawn (2013) | Bowers (1983) |
| Discovery sanction fees | CCP § 2023.030 (mandatory if no justification) | ORCP 46 A(4)(a) | CR 37(a)(5) |
| FDCPA fees in state court | 15 U.S.C. § 1692k (applied) | 15 U.S.C. § 1692k (applied) | 15 U.S.C. § 1692k (applied) |