Royster Construction Co. v. Urban West Communities

Defendants and cross-complainants Urban West Communities, UWC-Valley Circle, UWC-Canoga and the American Insurance Company appeal from the judgment following bench trial entered for plaintiff and cross-defendant Royster Construction Company. For the reasons set forth below, we modify the judgment both in regard to its award of attorney fees and its award of prejudgment interest.

Facts and Procedural History

Defendants and appellants UWC-Valley Circle and UWC-Canoga are limited partnerships which owned two tracts of land slated for residential development in Canoga Park (the West Hills project). Defendant and appellant Urban West Communities, a California corporation, is a general contractor and a partner in UWC-Valley Circle and UWC-Canoga. Plaintiff and respondent Royster Construction Company (Royster) is a grading contractor. In August 1985, Royster entered into a written agreement with UWC to act as the grading subcontractor for the West Hills project. The contract contained a clause calling for the payment of attorney fees to the prevailing party in an action arising from the agreement. Pursuant to the contract, Royster obtained a performance bond at UWC’s expense.…