Reda

Code of Civil Procedure section 685.040, provides that when a judgment awards attorney fees pursuant to a contract, the postjudgment attorney fees incurred by the judgment creditor in “enforcing” the judgment are included as recoverable costs. In this case, we are asked to consider whether attorney fees expended by a judgment creditor in successfully defending itself in a separate action filed against it by the judgment debtor, which had as its sole purpose the specific enforcement of an alleged agreement to settle the judgment debt at a substantial reduction, are attorney fees expended by the judgment creditor in enforcing the judgment. We conclude they are, and reverse the trial court’s postjudgment order taxing the judgment creditor’s postjudgment costs.

FACTS

1. The Underlying Litigation and Judgment for Globalist

In this case, Globalist Internet Technologies, Inc. v. Iron Horse Holdings Inc. (Super. Ct. Orange County, 2003, No. 01CC08369) (hereafter Globalist v. Iron Horse), Globalist Internet Technologies, Inc. (Globalist), successfully sued Albert R. Reda, Seamless Wi-Fi, Inc., a corporation formerly known as Internet Business’s International, Inc. (and…