Castro

In this case we must decide whether a party moving to expunge an improperly recorded lis pendens is entitled to attorney fees as a “prevailing party” under Code of Civil Procedure section 405.38 when the lis pendens is withdrawn before a ruling on the motion. We conclude that the withdrawal of a lis pendens while a motion to expunge is pending does not automatically preclude recovery of attorney fees to the moving party. Rather, we adopt a practical approach to determine the prevailing party based on the trial court’s determination of which party realized its objectives in the proceeding. Such a determination requires the trial court to consider the merits of the motion, and whether the lis pendens claimant acted with substantial justification in withdrawing the lis pendens, or whether, in light of all of the circumstances, the imposition of fees would otherwise be unjust.

The record reveals that the trial court believed it could not award attorney fees to petitioner Alexandra and Edith Castro (collectively, the Castros) under section 405.38 when real parties in interest California Savings, the Sterling Family Trust, R. Sterling, as a trustee of the Sterling Family…