Attorney’s Fees as Punitive Damages

January 30, 2018 § Leave a comment

May a chancellor award attorney’s fees in lieu of punitive damages?

That question was before the COA in the case of Cronier, et al. v. ALR Partners, et al., handed down December 12, 2017.

In that case, the Rainwaters (ALR Partners) sued for adverse possession of 9.75, naming the Croniers as defendants. Allen Cronier claimed ownership of the property in dispute. As the matter degenerated from discussion to litigation, Cronier erected fences and gates cutting off the Rainwaterses’ access to the contested property. Cronier even conveyed the disputed property to his twelve-year-old granddaughter, retaining a life estate. Following a trial the chancellor found in favor of the Rainwater claim of adverse possession, ordered Cronier to remove all of the fencing and gates from the property, and ordered Cronier to pay the Rainwaterses’ attorney’s fees and court costs. Cronier appealed, raising several issues, among which was that the court erred in awarding attorney’s fees.

The COA reversed and remanded only for the court to state specifically whether the award of attorney’s fees in lieu of punitive damages. Judge Barnes wrote the 9-1 decision, Judge Tindell concurring and dissenting in part:

¶35. The chancellor ordered the Croniers to pay the Rainwaterses’ attorney fees and court costs because the “actions of Allen in erecting a fence around the property were in clear disregard of the Rainwaterses’ rights.” Additionally, the chancellor stated that Allen “knew at the time he built the fence and conveyed the property to his minor granddaughter that there was a serious claim” to the disputed parcel.

¶36. At trial, the Rainwaterses submitted a statement for attorney fees of $9,790.05, not including ten hours spent at trial. The chancellor added ten hours of fees to this figure, but deducted five hours, because she did not find in favor of the Rainwaterses’ adverse possession claim for the southern portion of the property. Therefore, a total of $10,790.05 in attorney fees was awarded to the Rainwaterses.

¶37. Allen argues that attorney fees are not allowed in the absence of contractual provisions, statutory authority, or an award of punitive damages.

¶38. Mississippi follows the American rule for awards of attorney fees. “[A]bsent some statutory authority or contractual provision, attorneys’ fees cannot be awarded unless punitive damages are also proper.” Fulton v. Miss. Farm Bureau Cas. Ins., 105 So. 3d 284, 287-88 (¶16) (Miss. 2012). Punitive damages are only proper when the plaintiff shows by clear and convincing evidence the defendant acted with actual malice. Miss. Code Ann. § 11-1-65 (Rev. 2014). “[T]he plaintiff must demonstrate a willful or malicious wrong, or the gross, reckless disregard for the rights of others.” Wise v. Valley Bank, 861 So. 2d 1029, 1034 (¶15) (Miss. 2003).

¶39. Here, while there is no contractual provision, statutory authority, or specific award of punitive damages, the chancellor awarded attorney fees for the same reason the Rainwaterses requested punitive damages in their amended complaint (for the “Defendants’ reckless disregard of the Plaintiffs’ rights in this case”). The Mississippi Supreme Court has held that attorney fees may be awarded instead of punitive damages. Pursue Energy Corp. v. Abernathy, 77 So. 3d 1094, 1102 (¶26) (Miss. 2011) (citing Aqua-Culture Tech. Ltd. v. Holly, 677 So. 2d 171, 184 (Miss. 1996)). Here, the chancellor did not specify in her order that she was awarding attorney fees in lieu of punitive damages. However, as the trier of fact she
could have found Allen acted with actual malice in removing boundary markers, and constructing gates and a fence. Accordingly, we reverse and remand for clarification of whether punitive damages were awarded in the form of attorney fees.

So, the award of attorney’s fees will stand if on remand the chancellor finds that Cronier’s conduct was with actual malice, justifying punitive damages, and she specifies that the fee award is in lieu of punitive damages.

The language quoted above is a nice summary of the law of attorney-fee awards in Mississippi. You can recite pretty readily, I am sure, some other avenues for fee awards in chancery, among them contempt, divorce, and as a sanction for discovery misconduct.

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