Attorney fees under the Song-Beverly Act

A brief review of attorney’s fees provided by Lemon Law consumer protection

2025 November

Lemon law disputes operate at the intersection of consumer protection and practical case management. The bench is driven by concerns to be even-handed when applying the Song-Beverly Consumer Warranty Act (Civ. Code, § 1790, et seq., hereinafter Song-Beverly), requiring clear records and efficient resolution, especially where fee-shifting and Code of Civil Procedure section 998 (§ 998) offers can form outcomes. From the advocacy side, success turns on early case valuation, negotiation, and reliable proof from accurate repair histories, applicable warranty and related documents supporting their damages theories (including incidental, consequential, and any civil-penalty claims).

Song-Beverly both compels repurchase or replacement of defective goods and shifts reasonable attorney fees to manufacturers and seller-defendants when the buyer-plaintiff is the prevailing party. In practice, fee-shifting is the engine that makes low- to mid-value consumer cases economically viable with the intent to assist buyers in enforcing warranties. This article discusses the statutory landscape of Song-Beverly fee awards, how courts calculate and adjust fee awards, the leading published cases (including recent guidance), and offers practical pointers on Song-Beverly’s relationship with § 998.

Statutory basis: One-way fees intended to vindicate consumer rights

Song–Beverly’s fee provision is straightforward. Civil Code section 1794, subdivision (d) (§ 1794(d)) provides that a prevailing buyer “shall be allowed by the court to recover as part of the judgment a sum equal to the aggregate amount of costs and expenses, including attorney’s fees based on actual time expended, determined by the court to have been reasonably incurred” in bringing and prosecuting the action. The California Legislature intended to make sure consumers can recover reasonable fees, but not prevailing manufacturers.

In engineering fees in this manner, the Legislature sought to support private enforcement of warranty rights that would otherwise be cost-prohibitive to consumers by empowering only prevailing buyers to recover costs of litigation. This uneven treatment of parties has been explained and embraced by our courts. As stated by the California Supreme Court,

[T]he primary financial benefit the Song-Beverly Act offers to consumers who sue thereunder to enforce their rights [is] their ability, if successful, to recover their ‘attorney’s fees based on actual time expended.’ Such fees generally comprise the lion’s share of the litigation costs, and the prospect of having to pay attorney fees even if one wins a lawsuit can serve as a powerful disincentive to the unfortunate purchaser of a malfunctioning automobile. By permitting prevailing buyers to recover their attorney fees in addition to costs and expenses, our Legislature has provided injured consumers strong encouragement to seek legal redress in a situation in which a lawsuit might not otherwise have been economically feasible.

(Murillo v. Fleetwood Enterprises, Inc. (1998) 17 Cal.4th 985, 994 [superseded by statute on related topic, Gorobets v. Jaguar Land Rover North America, LLC, Cal.App.2 Dist., October 10, 2024, review granted Jan. 15, 2025].)

Subsequent published cases agree. For example, in Nightingale v. Hyundai Motor America (1994) 31 Cal.App.4th 99, the First District Court of Appeals observed the statute allows “only for the recovery of attorney fees which have been ‘reasonably incurred by the buyer.’” (Id., 104, emphasis supplied.)

How courts calculate “reasonable” fees

California courts often calculate attorney fees in a variety of case types using the “lodestar method.” Under this approach, courts multiply the number of reasonable hours by the prevailing market rate for comparable legal services.  (PLCM Group v. Drexler (2000) 22 Cal.4th 1084, 1095.) The result of that calculation is the lodestar. The court may then adjust that figure upward or downward based on factors such as results achieved, risk, complexity, quality of advocacy, and delay in payment. (Ketchum v. Moses (2001) 24 Cal.4th 1122, 1132; Chodos v. Borman (2014) 227 Cal.App.4th 76.) Courts may also reduce hours for duplication, inefficiency, and over-staffing, and they may enhance fees to reflect contingency risk or exceptional results. Notably, because the lodestar reflects the reasonable market rate, a party may request, and the court may grant, a rate exceeding a discounted amount the party’s attorney agreed to accept. (Pasternack v. McCullough (2021) 65 Cal.App.5th 1050, 1055-1056.)

Courts may apply the lodestar method in a Song-Beverly action. (Pulliam v. HNL Automotive, Inc. (2021) 60 Cal.App.5th 396, 406.) Still, in this context, the prevailing buyer must show the fees incurred were allowable, reasonably necessary to conduct the litigation, and a reasonable amount. (Ibid.) Further, it is not appropriate for a court to base its fee award on the “amount of the prevailing buyer/plaintiff’s damages or recovery in a Song-Beverly Act action.’” (Hanna v. Mercedes-Benz USA, LLC (2019) 36 Cal.App.5th 493, 506, quoting Warren v. Kia Motors America, Inc. (2018) 30 Cal.App.5th 24, 37.) Such a proportionality analysis “‘would make it difficult, if not impossible, for individuals with meritorious civil rights claims but relatively small potential damages to obtain redress from the courts.’ [Citation.]” (Warren v. Kia Motors America, supra, 30 Cal.App.5th 24, 39, quoting Graciano v. Robinson Ford Sales, Inc. (2006) 144 Cal.App.4th 140, 164.)

However, the lodestar’s use is not universal in Song-Beverly cases. The holding in Nightingale v. Hyundai Motor America, supra, shows that § 1794 (d)’s “reasonably incurred” language can require tying fees to fees charged. In Nightingale, the First District Court of Appeal declined to apply the lodestar when calculating fees for the prevailing buyer. The Nightingale Court focused on the statute’s language, which provides that attorney fees be “reasonably incurred” by the buyer and emphasized that the fees must be based on the actual time expended and the monetary charges the prevailing buyer was liable to pay. The court found that this buyer was liable only for fees at the contractual rate of $120 per hour, even though the buyer’s attorney’s rate increased over time. The appellate court modified the award to reflect only fees actually incurred, rather than the higher rates that it found did not apply to the buyer. In contrast, had the court applied the lodestar method, the award might have included rate increases based on reasonable fees for comparable work.

Burden of proof: Prevailing buyer’s showing and defendant’s challenge

Section 1794(d) requires the court to base an attorney fee award on the actual time expended and on time reasonably incurred given all the circumstances, including case complexity, procedural demands, skill, and results. (McKenzie v. Ford Motor Co. (2015) 238 Cal.App.4th 695, 698, 703 [reversing denial of fees based on perceived duplication].) “The ‘plain wording’ of section 1794, subdivision (d) requires the trial court to ‘base’ the prevailing buyer’s attorney fee award ‘upon actual time expended on the case, as long as such fees are reasonably incurred – both from the standpoint of time spent and the amount charged.’” (Warren v. Kia Motors Am., Inc. (2018) 30 Cal.App.5th 24, 35 (Warren); accord Robertson v. Fleetwood Travel Trailers of California, Inc. (2006) 144 Cal.App.4th 785, 817.) But see Reynolds v. Ford Motor Co. (2020) 47 Cal.App.5th 1105, 1110 (Reynolds) [under the Song-Beverly Act, the award must rest on the judge’s calculation of actual time reasonably incurred; the statute does not impose a separate requirement that the court also find the amount of fees reasonable].)

A prevailing buyer therefore bears the burden of showing that the requested fees were reasonably necessary to the conduct of the litigation and reasonable in amount. (Doppes v. Bentley Motors, Inc. (2009) 174 Cal.App.4th 967, 998.) Courts have emphasized that the buyer must provide adequate documentation to support the fee request, including detailed billing records and evidence of prevailing rates in the community for similar work. (Pulliam v. HNL Automotive Inc, supra 60 Cal.App.5th 396; Nightingale v. Hyundai Motor America, supra, 31 Cal.App.4th 99.) Whether fees are reasonably incurred depends on case-specific circumstances, including “the complexity of the case and procedural demands, the skill exhibited and the results achieved.” (Goglin v. BMW of North America, LLC (2016) 4 Cal.App.5th 462, 470.) Appellate review of fee awards under § 1794(d), is for abuse of discretion. (Doppes v. Bentley Motors, Inc., supra, 174 Cal.App.4th 967, 998.)

CCP § 998 and Song-Beverly attorney fee awards

Section 998 promotes settlement by attaching financial consequences to the rejection of reasonable offers. It provides that a party who declines a valid § 998 offer and fails to obtain a more favorable result, may face cost-shifting penalties. The procedure is straightforward: Any party may serve a written offer to compromise at least 10 days before trial or arbitration, specifying the proposed judgment or award. If the offer is accepted, the offer and proof of acceptance are filed, and a judgment or award is entered accordingly.

In Murillo v. Fleetwood Enterprises, Inc., the California Supreme Court held that § 1794(d) does not constitute an express exception to the application of § 998 to Song-Beverly cases. This allows prevailing sellers to recover costs under § 998. (Murillo v. Fleetwood Enterprises, Inc. (1998) 17 Cal.4th 985, 996).

Thus, § 998 applies to cases brought under Song-Beverly, including those involving attorney fees and costs. For § 998 to apply, the settlement offer must be sufficiently specific and certain to allow the offeree to evaluate its terms. In Duff v. Jaguar Land Rover North America, LLC (2022) 74 Cal.App.5th 491, the court found that an offer to repurchase a vehicle for a specified amount or a ‘higher amount’ subject to proof was impermissibly vague, preventing the application of § 998’s cost-shifting provisions. Similarly, in Etcheson v. FCA US LLC, (2018) 30 Cal.App.5th 831, the court held that the buyers’ rejection of vague settlement offers was reasonable, and the trial court could not rely on those rejections to reduce attorney fees.

Having established that § 998 requires clarity, the courts in recent cases considered whether § 998 applies where no trial or arbitration occurred. The recent California Supreme Court case, Madrigal v. Hyundai Motor America (2025) 17 Cal.5th 592, strengthens § 998’s application to Song-Beverly actions by clarifying the statute applies in contexts where the case was settled and the settlement did not address fees and costs.

In Madrigal, Defendant Hyundai twice made § 998 offers, one for $37,396.60 and the other for $55,556.70, both with $5,000 in attorney fees, that plaintiffs rejected. Later, the parties reached a pretrial settlement for $39,000. The settlement did not mention either of the § 998 offers or any reservation of arguments about the offers’ effect on a request for costs. Following the settlement, plaintiffs sought attorney fees and costs, and defendant moved pursuant to § 998 to tax post-offer costs. The trial court ruled that § 998 did not apply because there was no judgment after trial. In a split decision, the Third District Court of Appeal reversed, and the Supreme Court affirmed the reversal.

In Madrigal, the California Supreme Court held that § 998’s cost-shifting rules can apply to buyers, even where the case settled before trial, if the buyer fails to accept a qualifying § 998 offer and then obtains a less favorable result. The Supreme Court specifically rejected the notion that the later settlement merged with the § 998 offers.

Given the Supreme Court’s reasoning in Madrigal, counsel should not assume settlement moots § 998. Thus, settling for less than the rejected (or lapsed) offer can activate post-offer cost shifting against the plaintiff unless the settlement expressly allocates costs and fees.

Likewise, in Ayers v. FCA US, LLC (2024) 99 Cal.App.5th 1280, (review dismissed August 13, 2025), the Second District confirmed that prevailing buyers under Song-Beverly are subject to § 998’s cost-shifting provisions. Again, buyers who reject reasonable pretrial offers and fail to recover more favorable results are not entitled to post-offer attorney fees and costs. This principle was further supported in Covert v. FCA USA, LLC (2022) 73 Cal.App.5th 821, where the court concluded that § 998 and § 1794(d) operate together to incentivize both litigation and settlement to more efficiently resolve disputes.

California courts continue to uphold the applicability of § 998 in Song-Beverly cases, affirming its role in promoting settlement and reducing litigation costs. While § 1794(d) assists cost-adverse buyers to pursue claims under Song-Beverly Act, § 998 requires that parties assess their positions realistically and carefully consider reasonable settlement offers. Further, all parties must be intentional when drafting settlements for post-settlement clarity.

Judicial discretion, reasonableness, and proportionality

Considered the best judges of professional services rendered before them, trial courts retain broad discretion in setting fee awards. Trial court fee rulings are presumed reasonable unless clearly wrong. (Bernardi v. County of Monterey (2008) 167 Cal.App.4th 1379.)

Courts apply a reasonableness analysis to Song-Beverly fee requests. The prevailing party must prove claimed market rates with relevant proof of rates for comparable work, typically through attorney declarations, comparable awards, rate surveys, or expert testimony. Courts may also rely on their own expertise in setting the rate. (Graciano v. Robinson Ford Sales, Inc. (2006) 144 Cal.App.4th 140, 155-156; Center for Biological Diversity v. County of San Bernardino (2010) 188 Cal.App.4th 603, 616-617.)

Opposing parties may argue the claimed fees are not reasonable. Courts tend to require efficient staffing and will reduce claims for hours when they find duplication or over-lawyering. For example, in Morris v. Hyundai Motor Am., supra 41 Cal.App.5th 24, the Court of Appeal approved significant reductions where counsel used an oversized team and repeated “start-up” work. (Id., at 35.) Courts review billing quality and can reduce awards for vague descriptions and block-billed entries in their discretion. (See, e.g., Christian Research Institute v. Alnor (2008) 165 Cal.App.4th 1315, 1325-1326.)

Reasonableness of fees and use of templates

A review of appellate caselaw reveals courts look past labels and will assess the work done with boilerplate or template filings. Courts may award only reasonable attorneys fees and can reduce requested Song-Beverly fees when attorneys are inefficient or work is duplicative since such is unreasonable. (Morris v. Hyundai Motor America, supra.) In Morris, for example, the trial court granted a fee award less than what was requested.  The Court of Appeal upheld the trial court’s order finding it properly ordered fees for a reasonable amount of work performed by an appropriate number of attorneys. There, defendant partly argued that plaintiff’s counsel’s filings differed only marginally from documents filed in other cases, and that the related billing did not accurately reflect the work done in the case at bar. (Id., at 30.) Plaintiff responded that, although counsel used forms, substantial work was needed to tailor them to the facts. (Id. at 30-31).

Likewise, in Mikhaeilpoor v. BMW of North America, LLC, (2020) 48 Cal.App.5th 240, the court found that trial counsel spent time on tasks that “should not have required anything more than [a] slight factual modification to [an] existing boilerplate.” (Id. at 250-251.) Accordingly, and for other reasons, the trial court awarded reduced fees.

The trial courts’ exercise of discretion to reduce fees in both cases was affirmed. Together, these cases show that trial courts have discretion to determine what fees are reasonable, based on the evidentiary record, including discounting hours when templates required little modification.

Conclusion

Read together, these decisions show a maturing framework for Song-Beverly attorney fees. Prevailing buyers may recover, but awards remain tied to actual time reasonably incurred. The lodestar can supply the point of departure, yet Nightingale can tether rates to the buyer’s contractual obligation. The buyer bears the burden of substantiating the request with evidence of reasonableness, and courts may exercise their discretion to reduce awards when finding work duplication, over-staffing, and other inefficiencies. In the settlement arena, § 998 retains real force. Counsel must be aware that their § 998 offers must be clear, and after Madrigal, a rejected, valid offer can operate to shift post-offer costs even when the case later resolves by settlement if counsel fail to include an express fee-and-cost allocation in the settlement.