A Nice Attorney’s Fees Package
May 4, 2020 § Leave a comment
It’s nice and helpful when an appellate court decision gives us a concise, authoritative statement of the law.
That’s what the COA did in the case of Krohn v. Krohn, decided April 21, 2020, on the issue of attorney’s fees, particularly in contempt cases. Here is what Judge McDonald wrote for the majority:
¶20. In assessing an award of attorney’s fees, the chancery court first determines the type of action brought and then uses the appropriate method for a calculation of any attorney’s fees to award. Regarding contempt actions, “[w]hen a party is held in contempt for violating a valid judgment of the court, attorney’s fees should be awarded to the party that has been forced to seek the court’s enforcement of its own judgment.” Garner v. Garner, 283 So. 3d
120, 142 (¶98) (Miss. 2019). “Fees awarded on this basis, though, should not exceed the [attorney’s time and] expenses incurred as a result of the contemptuous conduct.” Heisinger v. Riley, 243 So. 3d 248, 259 (¶45) (Miss. Ct. App. 2018). The court “shall make the award [for contempt actions] based on the information already before it and the court’s own opinion based on experience and observation[.]” Taylor v. Timmons (In re C.T.), 228 So. 3d 311, 319 (¶21) (Miss. Ct. App. 2017) (quoting Miss. Code Ann. § 9-1-41 (Rev. 2014)). A successful party in a contempt action need not show that he or she was unable to pay their attorney. Wilkinson v. Wilkinson, 281 So. 3d 153, 167 (¶52) (Miss. Ct. App. 2019).
¶21. In other matters, e.g., motions for modifications, an award of attorney’s fees is based only on the successful party’s inability to pay; in such cases, “the Mississippi Supreme Court established several factors [in McKee, infra,] to determine the proper amount of attorney’s fees to award in domestic cases.” Chism v. Chism, 285 So. 3d 656, 667 (¶39) (Miss. Ct. App. 2019). “The McKee factors state that an award of attorney’s fees ‘should be fair, should
compensate only work actually performed, and should be based upon a finding that the work was reasonably required and necessary.’” Id. (quoting Deborah H. Bell, Bell on Mississippi Family Law § 12.02[l], at 359 (1st ed. 2005) (discussing McKee v. McKee, 418 So. 2d 764 (Miss. 1982))). The McKee factors include the following:
(1) relative financial ability of the parties; (2) the skill and standing of the attorney employed, (3) novelty and difficulty of issues in the case, (4) the
responsibility required in managing the case, (5) time and labor required, (6) the usual and customary charge in the community, and (7) whether the attorney was precluded from undertaking other employment by accepting the case. Baumbach v. Baumbach, 242 So. 3d 193, 208-09 (¶54) (Miss. Ct. App. 2018) (Fair, J., concurring in part and dissenting in part). This Court permits an award of attorney’s fees “in a divorce case where the requesting party establishes an inability to pay.” Stewart v. Stewart, 2 So. 3d 770, 776 (¶18) (Miss. Ct. App. 2009) (quoting Gray v. Gray, 745 So. 2d 234, 239 (¶26) (Miss. 1999)). “However, if a party is financially able to pay her attorney, an award of attorney’s fees is not appropriate.” Id. (citation omitted).
¶22. In Wilkinson, we acknowledged that although both parties were found in contempt, the court can still award one party attorney’s fees. Wilkinson, 281 So. 3d at 167 (¶55). There, Rod and Stephanie Wilkinson were both found in contempt for making derogatory remarks; therefore, the court declined to award attorney’s fees to either party on that issue. Id. at (¶53). However, Rod argued Stephanie could not receive any attorney’s fees because she was found in contempt on one issue (the unclean hands doctrine [Fn omitted]), but this court was not persuaded by Rod’s argument. Id. at (¶55). In addition to the contempt for derogatory remarks, the court found Rod in contempt regarding child support and visitation. Id. at 159 (¶5). We affirmed the award to Stephanie of $3,700.00 in attorney’s fees for Rod’s contempt of child support and visitation requirements. Id. at 169 (¶62).
¶23. In Wilkinson, we also found the chancery court properly analyzed the attorney’s fees for the contempt actions and other actions separately. For matters other than contempt, the court used the inability to pay standard to determine attorney’s fees, which incorporated McKee factors in determining Stephanie’s inability to pay. Id. at (¶58). Therefore, we affirmed the award of $4,933.00 in attorney’s fees not attributable to the contempt actions.
Id. at 169 (¶62).
¶24. In this case, like Wilkinson, we find no error in the chancery court’s award of attorney’s fees for Karen, even though she was found in contempt on a minor issue. Here, the chancery court found Melvin in willful, wanton, and contumacious contempt for his failure to pay child support and failure to pay alimony. The court also found Melvin in contempt for his failure to immediately obtain life insurance in the amount of $50,000.00. The court only found Karen in contempt for her failure to produce a copy of the child’s shot records upon Melvin’s request. Therefore, the court did not err in awarding Karen attorney’s fees. However, the court did err in the amount of attorney’s fees it awarded Karen.
¶25. The record shows attorney’s fees based on the cumulative amount of time spent on the contempt actions and modifications matters. Karen’s pleadings involved issues other than contempt, such as modification of custody and visitation. Prior to the final hearing, the parties went to court on these matters and resolved all but the contempt matters.
¶26. The chancery court erred in awarding Karen attorney’s fees for her representation in all these matters. The only factor that the chancery court addressed in ruling to award all attorney’s fees to Karen was the number of times the parties have been to the court. Without more, we find that the chancery court’s decision to award attorney’s fees should be reversed and remanded for proper determination of the amount of attorney’s fees attributable to the contempt actions and the amount of attorney’s fees owed, if any, for the other matters.
Inability to Pay Attorney’s Fees
April 20, 2020 § 1 Comment
In the divorce action between Morgan and Melanie Ewing, on remand, one of the issues presented to the chancellor was whether Melanie was entitled to an award of attorney’s fees, and, if so, how much.
Following a trial, the chancellor ordered Morgan to pay Melanie an attorney’s fee of $11,807.57. Morgan again appealed.
In Ewing v. Ewing, decided April 7, 2020, the COA affirmed. Chief Judge Barnes wrote for the unanimous court:
¶16. Morgan claims that the chancery court also erred in awarding Melanie attorney’s fees in the amount of $11,808.57. “Attorney’s fees may only be awarded to a party who has shown an inability to pay his or her own fees . . . [, and] chancellors are instructed to make specific findings regarding the recipient’s ability to pay.” Evans v. Evans, 75 So. 3d 1083, 1089 (¶22) (Miss. Ct. App. 2011). Addressing the factors in McKee v. McKee, 418 So. 2d
764, 767 (Miss. 1982), the chancery court found that Melanie had “incurred $11,808.57 in attorney’s fees by a skilled attorney as a result of litigation spanning three (3) years which required a large degree of responsibility in management and time and precluded the prior legal counsel from other employment.” The court expressly determined that Melanie had an inability to pay her attorney’s fees, noting that Melanie’s 2015 financial declaration from the trial indicated a net monthly income (before child support) of $851.70 and net monthly expenses of $2,830.00, leaving her with a monthly deficit of $1,978.30.
¶17. Morgan claims that the chancery court erred in failing to take into account his inability to pay attorney’s fees as evidenced by his Rule 8.05 financial declarations. This Court has held that “[w]here neither party is able to pay more than his or her own fees, an award of attorney’s fees is inappropriate.” Evans, 75 So. 3d at 1089 (¶24) (citing Sarver v. Sarver, 687 So. 2d 749, 755 (Miss. 1997), overruled on other grounds by Pearson v. Pearson, 761 So.
2d 157, 163 (¶17) (Miss. 2000)). We find that the record indicates the chancery court did consider Morgan’s ability to pay in its order, stating:
Currently, Morgan’s net monthly income after payment of child support is $2,629.52. Morgan[’s] net income before payment of child support as of the date of divorce was $2,579.35. Morgan is directed to pay periodic alimony in the amount of $500.00 per month and $250.00 per month towards Melanie’s attorney’s fee, then he would still net $1,629.52 each month based upon his current income, which is sufficient considering Melanie has [four] children living with her and he only has himself.
Reviewing Morgan’s 2018 financial declaration, we note a minor discrepancy between the court’s calculation and ours—we find that Morgan would actually have a net monthly income of $1,879.53 (after taxes, insurance, child support, alimony, and attorney’s fees are deducted from his monthly income). Nevertheless, this amount is greater than the chancery court’s determination, and Morgan’s net monthly income has increased since 2015. Therefore, we find no merit to his argument and affirm the chancery court’s award of attorney’s fees to Melanie.
This is a good arrow to have your quiver if you have to argue for an award of attorney’s fees for a low-income client.
Attorney’s Fees in Modification Cases
December 4, 2019 § Leave a comment
Can the court award attorney’s fees in a modification of child support case?
The COA dealt with that question in the case of Blevins v. Wiggins, decided November 5, 2019. Judge Corey Wilson penned the opinion:
¶17. Amy [Blevins] asserts that the chancery court applied an erroneous legal standard to deny her request for attorney’s fees. She contends that Monty’s counterclaim was not filed in good faith because Monty [Wiggins] “did not allege that a material change in circumstance had occurred which had an adverse impact on the children.” Amy further contends that Monty filed the counterclaim to financially harass her and that the chancery court failed to consider her inability to pay attorney’s fees.
¶18. “The standard for an award of attorney[’s] fees on a motion for modification of support is basically the same as that applied in an original divorce action.” Setser v. Piazza, 644 So. 2d 1211, 1216 (Miss. 1994). “Attorney fees are not awarded in child support modification cases unless the party requesting fees is financially unable to pay them.” Id. However, “[t]he question of attorney fees in a divorce action is a matter largely entrusted to the sound discretion of the trial court,” and we are generally “reluctant to disturb a chancellor’s discretionary determination whether or not to award attorney fees and of the amount of [any] award.” Ferguson v. Ferguson, 639 So. 2d 921, 937 (Miss. 1994); Geiger v. Geiger, 530 So. 2d 185, 187 (Miss. 1988).
¶19. Further, Mississippi Code Annotated section 11-55-5(1) (Rev. 2012) provides that
in any civil action commenced or appealed in any court of record in this state, the court shall award, as part of its judgment and in addition to any other costs otherwise assessed, reasonable attorney’s fees and costs against any party or attorney if the court, upon the motion of any party or on its own motion, finds that an attorney or party brought an action, or asserted any claim or defense, that is without substantial justification, or that the action, or any claim or defense asserted, was interposed for delay or harassment . . . .
(Emphasis added).
¶20. Here, the chancery court considered the relative financial condition and earning capacity of the parties—specifically, Amy’s and Monty’s financial declarations and monthly incomes and expenses— and concluded that “[u]nder the facts of this case, the law requires that each party pay their own attorney fees.” Regarding Amy’s inability to pay attorney’s fees, the chancellor heard the testimony, considered the financial evidence offered by the parties, and determined that an award of attorney’s fees was not warranted. Consequently, we decline to disturb the chancery court’s ruling with regard to attorney’s fees.
¶21. Furthermore, based on the record, we cannot find that Monty’s counterclaim for custody was filed without substantial justification or was interposed for delay or harassment such that the chancery court erred in declining to award Amy attorney’s fees under section 11-55-5(1). At trial Monty testified that he was seeking custody of the children “[b]ecause I would love [for] them to live with me. They have been with [Amy] ever since we have been divorced and, you know, I mean, why shouldn’t I have the opportunity to raise them as well.” Monty also testified that, in his opinion, receiving custody “would [put an end to] a lot of the fighting [over] the money because I wouldn’t be asking for any money.” Effectively, Monty’s counterclaim involved the same issues raised in Amy’s petition for modification such that the same evidence and issues were to be tried whether Monty asserted his counterclaim or not. We cannot conclude that the chancery court erred in denying Amy’s request for attorney’s fees.
More often than one would expect, the only evidence I have of inability to pay is an assertion. Sometimes I have 8.05’s to substantiate the claim. Quite often neither party has ability to pay. In that situation it is erroneous to award attorney’s fees. Masino v. Masino, 829 So. 2d 1267, 1274 (Miss. Ct. App. 2002).
No Attorney’s Fees for You After All
August 20, 2019 § Leave a comment
Nat Alford and his wife Linda consented to a divorce on the ground of irreconcilable differences, leaving it up to the chancellor to adjudicate several issues, including whether Linda should be awarded attorney’s and expert-witness fees. Linda testified that she had been “struggling” to make monthly payments against the more than $24,000 billed by her attorney.
The chancellor ordered Nat to pay $5,000 toward Linda’s attorney’s fees, and $6,000 toward expert witness fees. Nat appealed, and one issue he raised was that the award was erroneous.
The COA reversed and rendered in Alford v. Alford, decided July 23, 2019. Judge Jack Wilson wrote for the majority:
¶31. “An award of attorney’s fees is appropriate in a divorce case where the requesting party establishes an inability to pay.” Gray v. Gray, 745 So. 2d 234, 239 (¶26) (Miss. 1999). “The party seeking attorney’s fees is charged with the burden of proving inability to pay.” Riley v. Riley, 846 So. 2d 282, 287 (¶23) (Miss. Ct. App. 2003) (citing Jones v. Starr, 586 So. 2d 788, 792 (Miss. 1991)). “It is well settled in Mississippi that if a party is financially able to pay an attorney, an award of attorney’s fees is not appropriate. Furthermore, if the record is insufficient to demonstrate the wife’s inability to pay the attorney’s fees, then an award of the fees is an abuse of discretion.” Gray, 745 So. 2d at 239 (¶26) (citations omitted).
¶32. At trial, Linda offered a list of invoice amounts prepared by her attorney that showed that he had billed her a total of $24,572.94, which included the trial. Linda also requested expert witness fees (for Paris) in the amount of $6,000. Linda and her attorney both testified that she had been paying $1,000 per month in attorney’s fees, although neither of them could say how much she had paid in total. Linda also testified that she had been paying $500 per month to Paris’s firm, although she did not state how much she had paid or how much was left to pay. Linda testified that she had been able to make her monthly payments to her attorney and expert, although she said that she had “been struggling to” do so. Linda’s attorney testified regarding his time and fees and Linda’s ability to pay. On cross examination, he was asked whether the equitable distribution of the marital assets would provide Linda with sufficient “financial resources to pay [her fees].” In response, he stated, “I would certainly hope that the [c]ourt awards [Linda] what [she] requested, which is 50 percent of the marital assets. If that occurs, then she certainly would have the money to pay me at that time. I would agree with that.”
¶33. Following the trial, the chancellor found that Linda had the ability to pay some but not all of her attorney’s fees. The chancellor then ordered Nat to pay her $5,000 for attorney’s fees and $6,000 for expert witness fees.
¶34. We conclude that the award of attorney’s fees and expert witness fees was an abuse of discretion because “the record is insufficient to demonstrate [Linda’s] inability to pay.” Gray, 745 So. 2d at 239 (¶26). Linda testified that she had been able to pay her attorney’s fees and expert witness fees in monthly installments of $1,000 and $500, respectively, and she failed to show how much she had already paid or what she still owed. In addition, Linda was awarded bank accounts with a combined balance of approximately $17,000, a Merrill Lynch account with a balance of $134,115.06, and retirement accounts with a combined balance in excess of $375,000. Linda received nearly half of the marital assets, which her attorney agreed would be sufficient to allow her to pay her attorney’s fees. There is nothing in the record to show that Linda would have been required to liquidate any significant part of her savings to pay her attorney or her expert. Indeed, as stated, the record does not even show what Linda owed at the time of trial. On these facts, Linda failed to meet her burden of establishing an inability to pay her fees. See, e.g., Dauenhauer v. Dauenhauer, 271 So. 3d 589, 601 (¶51) (Miss. Ct. App. 2018) (holding that award of attorney’s fees was an abuse of discretion where the spouse had already paid part of his fees in installments and had sufficient assets to pay the balance). Accordingly, the award of attorney’s fees is reversed and rendered.
” … [S]he failed to show how much she had already paid or what she still owed.” So how could one expect the chancellor to make an accurate ruling? I will reiterate what I have said here many times: if you expect to get your client an award of attorney’s fees you have to put some time and thought into what it will take to prove entitlement to that award. Close will not get the cigar. Slapdash won’t even come close.
The chancellor clearly concluded that Linda should have help with some of her attorney’s and expert fees. What the chancellor was not given to support her conclusion, however, was: (1) the amounts Linda had paid; (2) the remaining balances; (3) more detail about the financial strain the fees had imposed on her; and (4) what financial impact it would have on her equitable distribution to have it reduced by attorney’s fees.
I also thought it was interesting that Linda’s attorney was allowed to testify, apparently without objection, to Linda’s ability to pay. That, to me, is a fact issue in the case, and attorneys are not allowed by ethics to be fact witnesses except as to what they are owed in attorney’s fees. I have stopped attorneys in situations like that and directed them to limit their testimony to how much is owed, what services were rendered, what has been paid, and the employment contract. Maybe that’s just me.
Reasonableness of the Fee
July 23, 2019 § 1 Comment
Attorney Blackburn contracted with Burford in 2008 to provide legal services ” … in connection with his estate plan and the administration of his estate, including but not limited to preparation of estate planning documents, consultations, updates/revisions, and the formal administration of his estate upon his demise including assistance with Client’s revocable living trust.” The agreed fee was $265,000.
Six years after the contract was signed, Blackburn died. The following year Burford died.
Blackburn’s executor probated a claim against Burford’s estate for $265,000. Following a hearing, the chancellor ruled that the contract was one for personal services, and was therefore unenforceable due to Blackburn’s death. She allowed Blackburn’s estate to recover reasonable attorney’s fees based on quantum meruit. Blackburn’s estate appealed.
In Estate of Burford v Freeman, decided April 16, 2019, the COA affirmed. One issue raised by the appellant was that the legal services contract was invalid because the fee was unreasonable. The majority (by Judge McCarty) held that, because the contract ended with Blackburn’s death, it did not need to reach the issue.
Judge Jack Wilson wrote a concurring opinion that does address the reasonableness of the fee arrangement. Since it includes an enlightening analysis, I am providing part of it here:
¶31. Rule 1.5 of the Mississippi Rules of Professional Conduct clearly mandates that “[a] lawyer’s fee shall be reasonable.” M.R.P.C. 1.5(a). Section 34 of the Restatement (Third) of the Law Governing Lawyers (2000) likewise states that “[a] lawyer may not charge a fee larger than is reasonable under the circumstances.” This principle applies not only in disciplinary disputes but also in contract disputes between lawyers and clients. 1 Geoffrey C. Hazard et al., The Law of Lawyering § 9.06.1, at 9-18 (4th ed.) (“[I]n a variety of civil contests between lawyers and clients over fees, the client will prevail unless the lawyer’s fee is reasonable.”). Indeed, “courts are generally more likely to find a fee unreasonable in the sense that it is unenforceable against the client than they are to find the same fee so unreasonable as to warrant professional discipline.” Id. at 9-23. “[I]n fee disputes between lawyer and client, [an unreasonable] fee will not be approved . . . even though the parties had agreed to the fee.” Restatement, supra, § 34 cmt. a (emphasis added). In such cases, “[a] client-lawyer fee arrangement will be set aside when its provisions are unreasonable to the client.” Id. cmt. b (emphasis added); accord 1 Robert L. Rossi, Attorneys’ Fees § 1:18, at 1-56 (3d ed.) (“Courts may scrutinize fee agreements to determine the reasonableness of the fee, and have the inherent power to refuse to enforce contracts for excessive fees. Thus, the excessiveness of the fee may be asserted by the client as a contract defense in an action to recover an attorney’s fee.”). [Fn 4]
[Fn 4] “Although reasonableness is usually assessed as of the time the contract was entered into, later events might be relevant.” Restatement, supra, § 34 cmt. c. For instance, a large flat fee may be found unreasonable if it far exceeds the reasonable value of the services ultimately provided by the attorney. 1 Hazard et al., supra, § 9.06.2, at 9-24 to -25; Jeffrey Jackson & Donald Campbell, Professional Responsibility for Mississippi Lawyers § 22:7, at 22-9 (2010).
¶32. “Such a rule obviously encroaches upon the freedom of contract, but the limitation of reasonableness is a longstanding one.” 1 Hazard et al., supra, § 9.02, at 9-8. Moreover, the rule simply recognizes that “[l]awyers . . . owe their clients greater duties than are owed under the general law of contracts.” Restatement, supra, § 34 cmt. b; see also, e.g., In re A.H. Robins Co., 86 F.3d 364, 374 (4th Cir. 1996) (“An attorney has the burden of proof as to the reasonableness of his fee when he sues to recover from his client. This allocation of the burden of proof is premised on the relationship of trust owed by a lawyer to his client, with concomitant obligation to charge only a reasonable fee . . . . This approach is at the very heart of the special relationship between attorney and client.”) (quoting McKenzie Construction Inc. v. Maynard, 758 F.2d 97, 100 (3d Cir. 1985)). “Fee contracts between attorney and client are the subjects of special interest and concern to the courts, and are not to be enforced on the same basis as ordinary commercial contracts.” 1 Rossi, supra, § 1:13, at 1-42.
¶33. There are few reported Mississippi cases about contractual fee disputes between attorneys and clients. However, as stated above, our law is clear that a lawyer may not charge or attempt to collect an unreasonable or excessive fee. See M.R.P.C. 1.5(a); Miss. State Bar Ass’n v. A Miss. Atty., 489 So. 2d 1081 (Miss. 1986). Moreover, the Mississippi Supreme Court has held that a fee agreement “will be held invalid” if it provides for a fee that “is so excessive in proportion to the services to be rendered as to be in fact oppressive or extortionate.” Fitzpatrick v. Kellner, 187 Miss. 843, 850-51, 193 So. 911, 912-13 (1940); accord Ownby v. Prisock, 243 Miss. 203, 207-08, 138 So. 2d 279, 280 (1962).
¶34. The fee agreement at issue in this case is invalid and unenforceable because it purports to charge an unreasonable and excessive fee. The record shows that Blackburn drafted and later revised a relatively simple will and a few other documents. The other documents are not even in the record, but apparently none took much time for Archer to create. As noted above, the original drafts of the will and other documents and two rounds of later revisions all predated the fee agreement that Blackburn is attempting to enforce in this case. Blackburn implies that Burford’s estate was expected to be large or complicated, but there is no credible evidence in the record to show that. There was testimony suggesting that Burford was perhaps a difficult client who required some special attention; however, as discussed above, that testimony was also vague and internally contradictory. There was also vague testimony that Blackburn handled a “car wreck” and a “real estate closing” for Burford. But Blackburn presented absolutely no evidence as to what or how much time either matter involved. More important, neither matter related to the fee agreement that Blackburn seeks to enforce in this case, which covers only estate planning and administration.
¶35. In affirming the judgment of the chancery court, we also affirm the chancellor’s finding that “approximately 36 hours of work” was actually proven based on the testimony presented at trial in this case. That is a reasonable finding based on the “less-than-ideal evidence presented by the parties to the litigation.” Pruitt v. Pruitt, 144 So. 3d 1249, 1252-53 (¶11) (Miss. Ct. App. 2014) (emphasizing that a chancellor’s findings must be based on the evidence presented by the parties, even if that evidence is less than ideal). A fee of $265,000 for thirty-six hours of work is clearly unreasonable and excessive, and no other evidence was presented at trial that could possibly justify such a fee. Burford ultimately received a relatively simple will and a few other documents that, while not in the record, apparently were not complicated to create. For those services, $265,000 clearly is an unreasonable and excessive fee. This renders the fee agreement invalid and unenforceable. Fitzpatrick, 187 Miss. at 850-51, 193 So. at 912-13; Ownby, 243 Miss. at 207-08, 138 So. 2d at 280; Restatement, supra, § 34 cmt. a; Hazard et al., supra, § 9.06.1, at 9-18; Rossi, supra, § 1:18, at 1-56 (3d ed.). Therefore, the judgment of the chancery court could also be affirmed on this ground. [Fn omitted]
I have known some lawyers to charge huge fees in domestic litigation for what I considered average representation in run-of-the-mill cases. This case is a reminder that we have a professional responsibility to ensure that fees are reasonable.
Factors for Sanctions
May 15, 2019 § Leave a comment
Dana and Kevin Wilson obtained a TRO against Kevin’s ex-wife, Becky, following a series of unfriendly encounters and confrontations. On the issue of whether to grant a permanent injunction, however, the court granted Becky’s motion for summary judgment. Becky then filed an application for attorney’s fees under MRCP 11 and 54(d), which the chancellor granted in part. Dana and Kevin appealed.
in Wilson v. Wilson, decided March 12, 2019, the COA affirmed and addressed the court’s awarding of sanctions and the factors that trial courts are supposed to consider in their award. Chief Judge Barnes wrote the opinion:
¶14. Becky filed an application for attorney’s fees under Rule 11 and Rule 54(d) of the Mississippi Rules of Civil Procedure. Whether to award monetary sanctions under the Litigation Accountability Act is left to the trial court’s discretion. In re Spencer, 985 So. 2d 330, 336-37 (¶19) (Miss. 2008) (citing Miss. Code Ann. § 11-55-7) (Rev. 2002)). This is also true for sanctions awarded under Rule 11. Id. at 337 (¶19) (citing M.R.C.P. 11(b)). In addressing whether to award monetary sanctions, the chancery court examined each of the following factors:
(a) The extent to which any effort was made to determine the validity of any action, claim or defense before it was asserted, and the time remaining within which the claim or defense could be filed;
(b) The extent of any effort made after the commencement of an action to reduce the number of claims being asserted or to dismiss claims that have been found not to be valid;
(c) The availability of facts to assist in determining the validity of an action, claim or defense;
(d) Whether or not the action was prosecuted or defended, in whole or in part, in bad faith or for improper purpose;
(e) Whether or not issues of fact, determinative of the validity of a party’s claim or defense, were reasonably in conflict;
(f) The extent to which the party prevailed with respect to the amount of and number of claims or defenses in controversy;
(g) The extent to which any action, claim or defense was asserted by an attorney or party in a good faith attempt to establish a new theory of law in the state, which purpose was made known to the court at the time of filing;
(h) The amount or conditions of any offer of judgment or settlement in relation to the amount or conditions of the ultimate relief granted by the court;
(i) The extent to which a reasonable effort was made to determine prior to the time of filing of an action or claim that all parties sued or joined were proper parties owing a legally defined duty to any party or parties asserting the claim or action;
(j) The extent of any effort made after the commencement of an action to reduce the number of parties in the action; and
(k) The period of time available to the attorney for the party asserting any defense before such defense was interposed.
Miss. Code Ann. § 11-55-7. The chancery court addressed every relevant factor set forth in section 11-55-7 and found: (1) the Wilsons failed to investigate the validity of their claims; (2) the Wilsons failed to make an effort to reduce the number of claims against Becky; (3) all facts were “readily available to the Wilsons”; (4) “the Wilsons prosecuted the actions for an improper purpose”; (5) there were no issues of fact reasonably in conflict; (6) the Wilsons did not prevail with respect to any claim, and they were not granted any relief or offer any settlement; (7) Becky did not owe a duty to the Wilsons to explain why she was on a public street; and (8) although the Wilsons dismissed Martha from the case, they did not make an effort to dismiss Becky. [Fn omitted] Therefore, finding that Becky had incurred expenses of $715.50 and attorney’s fees of $8,287.50 since January 4, 2018, the Wilsons were ordered to pay Becky $9,003, plus interest.
Dana and Kevin argued that the chancellor’s findings were not supported by evidence in the record, but the COA analyzed the proof and affirmed the trial court.
This is a pretty useful template for proof if you find yourself having to present a case for sanctions. But I have to add that most judges in my experience do not look favorably on sanctions. There has to be a strong reason to discourage people from pursuing their legal remedies.
Proving Inability to Pay
May 13, 2019 § Leave a comment
When we think of the award of attorney’s fees in a divorce the first principle that comes to mind is “inability to pay.” We know and focus on the concept that the party with inability to pay will be entitled to attorney’s fees.
But inability to pay is only part of the formula. “The party seeking attorney’s fees is charged with the burden of proving inability to pay; usually where the party is able to pay his or her own attorney’s fees, an award of such fees is inappropriate.” Duncan v. Duncan, 915 So.2d 1124, 1128 (¶16)(Miss. Ct. App. 2005). [Emphasis added]
It’s that burden of proving that often is overlooked. The party’s mere assertion that he has the inability to pay, or a nodded affirmative to the question whether she can pay her own fees simply will not do the job. You have to put proof in the record that will support a finding by the judge that your client does not have the resources to pay.
In the COA case of Vandenbrook v. Vandenbrook, decided March 26, 2019, the court by Judge Carlton found the evidence lacking:
¶49. Based on our perusal of the record, the chancellor made no explicit findings addressing all of the McKee factors, either in her order, or on the record, but it can be surmised from the chancellor’s statement that she had considered them. [Fn 9] The more perplexing question is not the reasonableness of the amount awarded, but the basis for finding that Emma was not able to pay it. As noted, the chancellor stated: “But according to the McKee factors, you know, Emma has an inability to pay.” On the question of whether Emma had the ability to pay her own attorney’s fees, the chancellor offered no analysis of Emma’s financial condition that would support the conclusion that Emma was unable to pay them. During the chancellor’s discussion of the custody issue, she stated the following: “[Emma] has just entered the work force again, but it sounds like she’s got a stable job at this point. And it sounds like she has a stable home at this point.” We note that Emma testified that she could not pay her attorney’s fees. As stated, the burden was on Emma to prove that she could not pay her attorney’s fees. Although the decision to award attorney’s fees in a
divorce proceeding is left to the sound discretion of the chancellor, there must be evidence undergirding the chancellor’s decision that a party is unable to pay her attorney’s fees before an award can be made. Here, we find the record lacks such evidence. Therefore, we find that the chancellor erred in awarding attorney’s fees to Emma for the divorce proceeding, which ultimately resulted in Emma’s complaint for the divorce being dismissed. Accordingly, we reverse and remand the chancellor’s award of attorney’s fees for the chancellor to determine whether Emma has the inability to pay and to apply the McKee factors with supporting findings.
Fn 9 This Court in Evans v. Evans, 75 So. 3d 1083, 1090 (¶25) (Miss. Ct. App. 2011),stated the following: “While this [C]ourt has held that a chancellor’s failure to apply the McKee factors is not necessarily itself reversible error, see Miley v. Daniel, 37 So. 3d 84, 87(¶7) (Miss. Ct. App. 2009), the proof must at least support an accurate assessment of fees under the McKee criteria.”
I seriously doubt that this is a case where the chancellor overlooked the evidence in the record or failed to recite what evidence it was she relied on. My guess is that she had no evidence other than Emma’s assertion in her testimony upon which to base her finding. Why do I say that? Because I see it time and again. As I have posted here many times, lawyers for the most part devote little attention to making an adequate record to support an award of attorney’s fees.
My suggestion is that you spend a little less time on the more flamboyant issues like proof of adultery, and more time on the 8.05. Questions like “What money do you have to pay your attorney’s fees? How much have you had to borrow to pay? Why did you have to borrow? What effect will it have on your ability to buy the children’s school clothes if you have to pay your own attorney’s fees?” And so on. Oh, and while you’re at it, be sure to quiz the adverse party on his ability to pay, because his inability to pay may negate your claim.
The Half Fee on Appeal
April 9, 2019 § 2 Comments
It has been a long-standing rule in Mississippi that the prevailing party in an appeal is entitled to recover an attorney’s fee equal to one-half of the attorney’s fees awarded by the chancery court. For years, all that was required was either a separate motion or a section of the brief seeking that relief, with authorities.
That has changed, and a recent COA decision highlights how you need to approach the issue from here on out. In Brown v. Hewlett, handed down March 12, 2019, the court denied the attorney’s fee. Judge Jack Wilson’s opinion explained:
¶44. In his appellate brief, Hewlett requests an additional award of $2,500 in attorney’s fees for his defense of this appeal. Hewlett’s request appears to be well-taken because we have affirmed the chancellor’s finding that Brown was in contempt. See Heisinger [v. Riley], 243 So. 3d [248] at 260 (¶48) [(Miss. Ct. App. 2018)]. In such cases, we generally award appellate attorney’s fees equal to one half of the attorney’s fees awarded by the chancery court. See Riley v. Riley, 196 So. 3d 1159, 1164 (¶23) (Miss. Ct. App. 2016) (“Generally, on appeal this Court awards attorney’s fees of one-half of what was awarded in the trial court.”); accord Grant v. Grant, 765 So. 2d 1263, 1268 (¶19) (Miss. 2000).
¶45. Hewlett’s request is clearly set out in a separate section of his appellate brief with a citation to on-point authority. However, our Supreme Court recently held that a request for appellate attorney’s fees must be made in a motion that complies with Mississippi Rule of Appellate Procedure 27(a). Latham v. Latham, No. 2017-CA-00856-SCT, 2019 WL 242958, at *4-*5 (¶¶21-24) (Miss. Jan. 17, 2019). Therefore, we deny Hewlett’s request for appellate attorney’s fees without prejudice. Hewlett may renew his request in a motion that complies with Rule 27(a). Any such motion should be filed before the mandate issues.
Lesson: File a motion that complies with MRAP 27(a) before the mandate issues.
Of even greater interest, perhaps, are the specially concurring opinions of Judges McDonald and McCarty urging that the half-fee rule be abolished in favor of a reasonable fee based on time and effort. because you might want to argue this on appeal, I am providing those two opinions with their authority here:
McDONALD, J., SPECIALLY CONCURRING:
¶48. I recognize that the common law rule for granting attorney’s fees to the prevailing party on appeal is well established. Yates v. Summers, 177 Miss. 252, 170 So. 2d 827, 832 (1936); Riley v. Riley, 196 So. 3d 1159, 1164 (¶23) (Miss. Ct. App. 2016). But, I agree with Judge McCarty’s other specially concurring opinion that the amount of fees should be based on the time and energy expended on the appeal as opposed to an arbitrary “one-half” rule.
¶49. An analysis as outlined in McKee v. McKee, 418 So. 2d 764 (Miss. 1982), should be employed to determine the amount of attorney’s fees to be awarded to the prevailing party on appeal.
¶50. The Supreme Court recently ruled in Latham v. Latham, No. 2017-CA-00856-SCT, 2019 WL 242958 at *4-*5 (¶21-24) (Miss. Jan. 17, 2019), that submission of a motion and time records is the better practice and has now required such pursuant to Mississippi Rules of Appellate Procedure 27(a).
¶51. In the case under consideration, I believe that the majority made the correct decision by dismissing the request for attorney’s fees without prejudice and allowing the prevailing party to make a request in compliance with Mississippi Rule of Appellate Procedure 27(a). I therefore specially concur with the majority for the foregoing reasons.
WESTBROOKS AND McCARTY, JJ., JOIN THIS OPINION. TINDELL, J., JOINS THIS OPINION IN PART.
McCARTY, J., SPECIALLY CONCURRING:
¶52. I agree with the conclusions of the majority in all respects but write separately to emphasize that attorneys are bound by Rule 1.5 of the Mississippi Rules of Professional Conduct to only take a “reasonable fee.” The common law practice of seeking one-half of the attorney’s fees awarded by the chancery court is not tethered to our rules or the actual work performed by the attorney. In light of the Supreme Court’s ruling in Latham v. Latham, No. 2017-CA-00856-SCT, 2019 WL 242958 (Miss. Jan. 17, 2019), the practice should be fully eliminated
¶53. In Mississippi, “[a] lawyer’s fee shall be reasonable.” M.R.P.C. 1.5(a). As a matter of law, “the word ‘shall’ is a mandatory directive.” Ivy v. Harrington, 644 So. 2d 1218, 1221 (Miss. 1994). Rule 1.5 gives us a list of eight factors that guides whether the fee is reasonable—such as “the time and labor required,” or “the fee customarily charged in the locality for similar legal services,” and the experience and reputation of the attorney. M.R.P.C. 1.5(a)(1)-(8). These are “also known as the McKee factors . . . .” Tunica County v. Town of Tunica, 227 So. 3d 1007, 1031 (¶58) (Miss. 2017).
¶54. Therefore if one is seeking attorney’s fees, one must be able to show that it is a reasonable fee. Although in certain cases, such as this one, a flat fee or a request for a certain amount could be approved, in the vast majority of cases the attorney will need to demonstrate reasonableness. I believe this request cannot be done with a blanket ask for “one-half of the attorney’s fees awarded by the trial court.” The reasoning is common sense. The work in the trial court may have been formidably complex, as in this case, and required multiple attorneys over multiple years. In contrast, it might be only one attorney who handles an appeal, which might span the better part of a single year. The work of an appeal may not warrant one-half the trial-court fee, rendering it an unreasonable fee.
¶55. Conversely, in some appeals the written and oral advocacy required may be much greater than the work in a trial court. A one-day trial on a single issue may not require a large fee, but a change in the law or statute might warrant extensive briefing and research for an appeal. One-half the trial court fee would not be reasonable in such a situation, as more would be warranted.
¶56. Even at the dawn of the twentieth century it was simply “a matter of common knowledge amongst the profession that a less fee should be allowed for services in the Supreme Court than in the circuit or chancery court.” Curphy & Mundy v. Terrell, 89 Miss. 624, 42 So. 235, 236 (1906). In that case, the Supreme Court ruled that “[t]he whole profession may be said to have knowledge” that “[t]he old tariff in use in this state customarily made the fee in this court one-half the fee in the court below.” Id. By 1936, the Supreme Court was holding that “[i]t has long been our custom under such circumstances and in such cases to allow one-half of the fee allowed in the lower court when the fee fixed below is reasonable and proper.” Yates v. Summers, 177 Miss. 252, 170 So. 827, 832 (1936).
¶57. As a result, the one-half fee comes to us through years of precedent and was once so common that it was granted without citation. See, e.g., Jenkins v. Jenkins, 278 So. 2d 446, 450 (Miss. 1973) (no citation of law while granting the one-half fee). It was simply that “[t]he rule of this Court is to allow one-half of the amount awarded by the trial court.” Keyes v. Keyes, 252 Miss. 138, 145, 171 So. 2d 489, 491 (1965); [FN 8] Kyzar v. Kyzar, 248 Miss. 59, 64, 157 So. 2d 770, 772 (1963) (granting $125 for appellate fees, half of the $250 for trial court work). The one-half fee does not appear to ever have been actually one of the Supreme Court Rules that were in effect at the time before the adoption of the Rules of Appellate Procedure, and was elsewhere referred to as “the Court’s policy . . . to award attorneys’ fees on appeal of one-half of that allowed by the trial court. . . .” Tighe v. Tighe, 239 Miss. 666, 670, 124 So. 2d 843, 843 (1960). It may have had its origins in part or in whole in statutes which allowed chancellors to “divide[] as may appear equitable” the costs of suit. Miss. Code Ann. 1942, § 1583 (recompiled 1956); Powell v. Booth (In re Powell’s Will), 239 Miss. 10, 17, 121 So. 2d 1, 3 (1960) (citing to the statute for a one-half fee).
[Fn 8] In Keyes, the Court had even ordered the one-half fee when the appellant did not prevail in the appeal, but was demonstrably without funds and “[i]mportant questions were decided, and very sacred rights were in balance.” Id. at 491; accord Nix v. Nix, 253 Miss.
565, 571, 176 So. 2d 297, 300 (1965) (granting a one-half fee to losing party upon remand).
¶58. Regardless of its origin, and despite its lengthy history, the one-half fee award should be fully retired. Ultimately, the needs and requirements of advocacy between the trial court and appeal can be very different, and a generic request for one-half the trial court fee does
not properly honor Rule 1.5 or its requirement of reasonableness. Therefore any attorney seeking fees from this Court or any other is best served by adhering closely to the McKee factors and demonstrating that the fee they seek is reasonable.
WESTBROOKS, J., JOINS THIS OPINION IN PART. McDONALD, J., JOINS IN PART WITH OPINION.
Attorney’s Fees for Contempt
April 2, 2019 § Leave a comment
The COA’s decision in Wilkinson v. Wilkinson, handed down February 26, 2019, includes a nifty summary of the law applicable to award of attorney’s fees for contempt. Here is what Chief Judge Barnes’s opinion said:
¶51. The chancellor found the attorney’s fees incurred by Stephanie were reasonable, and billed at a reasonable rate given the time involved to prosecute the contempt allegations. The chancellor found the rate of $225 per hour customary, and her total fees incurred were $18,498.27. Stephanie’s counsel proffered that twenty-percent of his overall fees were related to contempt, which the chancellor accepted as proper.
¶52. The law on attorney’s fees for contempt is as follows:
“When a party is held in contempt for violating a valid judgment of the court, attorney’s fees should be awarded to the party that has been forced to seek the court’s enforcement of its own judgment. Fees awarded on this basis, though, should not exceed the expense incurred as a result of the contemptuous conduct.” That is, fees incurred litigating other matters—such as custody modification or child support—are not recoverable based on the contempt.
Heisinger v. Riley, 243 So. 3d 248, 259 (¶45) (Miss. Ct. App. 2018) (citations omitted). “[I]n contempt actions, attorney’s fees are awarded ‘to make the plaintiff whole.’” Bounds v. Bounds, 935 So. 2d 407, 412 (¶18) (Miss. Ct. App. 2006) (quoting Mabus, 910 So. 2d at 490 22 (¶13)). The Mississippi Supreme Court established several factors to determine the proper amount of attorney’s fees to award in domestic cases in McKee v. McKee, 418 So. 2d 764, 767 (Miss. 1982). However, “the establishment of the McKee factors [is] not necessary” to recover attorney’s fees for willful contempt of a lawful court order. Lewis v. Pagel, 172 So. 3d 162, 178 (¶40) (Miss. 2015) (quoting Mixon v. Mixon, 724 So. 2d 956, 964 (¶29) (Miss. Ct. App. 1998)).
¶53. Here, the chancellor found a McKee factor analysis was unnecessary to award attorney’s fees because some of Stephanie’s contempt claims were successful. Accordingly, the court award Stephanie approximately twenty-percent of $18,498.27, or $3,700 in attorney’s fees for Rod’s contempt of child support and visitation. Because both parties were found in contempt for derogatory remarks, the court declined to award attorney’s fees to either party on that issue based upon the clean-hands doctrine.
¶54. Rod argues that the chancellor erred as a matter of law in stating one who successfully prosecutes a contempt action “is entitled to attorney’s fees without a showing of need” instead of “eligible.” (Emphasis added). We do not interpret the chancellor’s remarks to mean it is a mandatory finding but that the court is authorized to award fees under circumstances such as this.
¶55. Additionally, because Stephanie was also found in contempt on the derogatory remarks, Rod argues she cannot receive any attorney’s fees for contempt because of the unclean-hands doctrine. This doctrine “prevents a complaining party from obtaining equitable relief in court when he is guilty of willful misconduct in the transaction at issue.” Vincent v. Rickman, 167 So. 3d 245, 249 (¶11) (Miss. Ct. App. 2015) (quoting Bailey v. Bailey, 724 So. 2d 335, 337 (¶6) (Miss. 1998)). However, we are not persuaded by this argument. The court did not award attorney’s fees to either party because both were found in contempt on this issue. This was the only issue for which Stephanie was found in contempt; however, Rod was found in contempt on two others. We find no error with the chancellor’s award.
Proof of Attorney’s Fees in a Mixed Action
July 16, 2018 § Leave a comment
Mark Campbell filed a combined contempt and modification action against his ex-wife, Misty. She counterclaimed. Following a hearing the chancellor granted relief and awarded Misty $4,141.97 in attorney’s fees. Mark appealed several issues, the attorney’s fee award among them.
In Campbell v. Campbell, decided June 19, 2018, the COA reversed and remanded the attorney’s fee award because there was insubstantial proof of what portion of the fees was attributable to defending the modification, and what was incurred in pursuing the contempt. Judge Tindell wrote the opinion:
¶17. Mark next challenges the chancellor’s award of $4,141.97 in attorney’s fees to Misty. After finding Mark’s allegations of abuse and neglect against Misty lacked evidentiary support, the chancellor ordered Mark to pay the fees Misty incurred defending against the unsubstantiated claims. See Miss. Code Ann. § 93-5-23 (Rev. 2013). Mark asserts on appeal, however, that Misty’s attorney never separated the fees incurred defending against the abuse and neglect allegations from the fees incurred litigating other matters. Since the chancellor only ordered Mark to pay the attorney’s fees related to the litigation of the abuse and neglect allegations, Mark argues the chancellor abused his discretion by failing to
separate those fees from the “fees otherwise incurred in Misty’s defense of Mark’s request for decreased child support and pursuit of her own request for increased child support.”
¶18. The decision to award attorney’s fees is largely entrusted to a chancellor’s sound discretion. Evans v. Evans, 75 So. 3d 1083, 1089 (¶22) (Miss. Ct. App. 2011) (citing McKee v. McKee, 418 So. 2d 764, 767 (Miss. 1982)). After finding Mark’s claims of abuse and neglect to be unsubstantiated, the chancellor was well within his authority to award Misty the attorney’s fees she incurred defending against the allegations. See Miss. Code Ann. § 93-5-23. However, the chancellor never made a finding that Misty lacked the ability to pay her attorney’s fees incurred litigating other matters. See Ewing v. Ewing, 203 So. 3d 707, 716 (¶33) (Miss. Ct. App. 2016) (“Generally, unless the party requesting attorney’s fees can establish [an] inability to pay, such fees should not be awarded.” (quoting Bredemeier v. Jackson, 689 So. 2d 770, 778 (Miss. 1997))). As a result, we find the chancellor abused his discretion by failing to separate the attorney’s fees Misty incurred defending against Mark’s allegations of abuse and neglect from those fees incurred litigating other matters. We therefore reverse this portion of the chancellor’s judgment and remand the issue so the chancellor may determine which attorney’s fees Misty incurred defending against Mark’s unsubstantiated allegations.
Here’s the deal: the standard that the judge is to apply in awarding attorney’s fees for a modification, or for a divorce for that matter, is different than the standard for an award of attorney’s fees for contempt. That is why you must put on proof of the amount of time devoted on the one hand to the modification issues, and on the other to the contempt issues. For modification, you will have to show your client’s inability to pay. For contempt, you merely have to make your prima facie case that the other party was not in compliance with the court order when the suit to enforce was filed.
Caveat: The reasonableness of the attorney’s fee award is reviewed in relationship to the McKee factors. A post dealing with this is at this link. You should always include proof of the McKee factors, even in contempt cases, because you want to make your attorney’s fee awards as bullets-proof as possible.
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