Winslow

INTRODUCTION

Kathy Lohr and Kathy Winslow (petitioners), shareholders of Alliance Industrial Refrigeration Services, Inc. (Alliance), made a written demand for inspection of various records pursuant to Corporations Code section 1601.1 After Alliance allegedly failed to comply with the inspection demand, petitioners sought court intervention and filed a petition for writ of mandate against respondents Alliance and its directors Grant Golding, Daniel Jordan, and Richard Dones. (§ 1603; Code Civ. Proc., § 1085.) Prior to the trial court ruling on the merits, respondents fully complied with the inspection demand. Petitioners thereafter sought attorney fees, arguing that Alliance’s refusal to comply with the inspection demand absent court intervention was without justification. (See § 1604.) Specifically, petitioners contended Alliance refused to provide a declaration regarding the nonexistence of certain corporation documents as well as a settlement agreement with a former employee. The trial court denied the motion for attorney fees. On appeal, petitioners argue the trial court erred in ruling: (1) a declaration of inability to comply with an inspection demand is not required by…