Attorney fees | The Better Chancery Practice Blog

A Shortcut for Attorney’s Fees?

July 15, 2013 § 3 Comments

We’ve talked here before about what it takes to make a record on attorney’s fees that will withstand scrutiny on appeal. Here’s a link to one such post among many. As I’ve said, it should be a subject of vital interest to attorneys who spend any time in court.

Did you know that there is actually a shortcut to proving attorney’s fees?

Here it is … MCA 9-1-41:

In any action in which a court is authorized to award reasonable attorneys’ fees, the court shall not require the party seeking such fees to put on proof as to the reasonableness of the amount sought, but shall make the award based on the information already before it and the court’s own opinion based on experience and observation; provided however, a party may, in its discretion, place before the court other evidence as to the reasonableness of the amount of the award, and the court may consider such evidence in making the award.

That would seem to be pretty clear, then. No proof as to reasonableness is required, and the court makes its award “based on the information already before it and the court’s own opinion based on experience and observation …, ” with the proviso that you can put in other evidence to support the award.

Does this mean that the McKee factors need not be considered? Not necessarily. In the case of Par Industries, Inc. v. Target Container Co., 708 So.2d 44, 54 (Miss. 1998), in a case dealing with attorney’s fees on an open account, which has its own particular body of law, the MSSC said, “This does not mean these factors are not relevant, just that proof of them is not required before a court awards attorney fees. This Court does not leave the reasonableness of an award for attorneys’ fees to the arbitrary discretion of the trial court.”

I think you can take from the Par Industries case that the appellate courts require the trial judge to flesh out how she arrived at a determination of reasonableness, and how the court calculated what the fee will be. In other words, a blanket award like “Plaintiff is awarded $5,000, which the court deems reasonable,” will not do the job. But an award that spells out what the court considered in making its decision will (or should).

MIXED ATTORNEY’S FEES

May 21, 2013 § 1 Comment

The COA decision in Tidmore v. Tidmore, decided May 14, 2013, underscores the mixed attorney’s fee, a fairly common phenomenon in chancery court. It happens when one brings an action combining two or more different causes of action. It could be a contempt and modification, or a divorce with an allegation of contempt of the temporary order, or a suit seeking injunctive relief and sanctions.

In reversing the chancellor’s award of attorney’s fees assessed against Nicole Tidmore in favor of her ex-husband, Michael, the COA, by Judge Irving, said this:

¶10. Nicole argues that the chancellor erred in awarding attorney’s fees to Michael since some of the attorney’s fees were incurred in pursuing a modification of custody. We note that “attorney’s fees are not normally awarded in child custody modification actions.” Mixon v. Sharp, 853 So. 2d 834, 841 (¶32) (Miss. Ct. App. 2003). However, it is well established that “[a] chancellor may award attorney’s fees as the result of a contempt action” in a domestic-relations case. Id. “One of the purposes for awarding attorney fees [in a contempt action] is to compensate the prevailing party for losses sustained by reason of the defendant’s noncompliance.” Durr v. Durr, 912 So. 2d 1033, 1040 (¶25) (Miss. Ct. App. 2005). Thus, “[n]o showing as to the McKee factors is required” where there is a finding of contempt. Patterson v. Patterson, 20 So. 3d 65, 73 (¶26) (Miss. Ct. App. 2009).

¶11. Additionally, Mississippi Code Annotated section 93-5-23 (Supp. 2012) requires the chancellor to impose attorney’s fees for unsubstantiated allegations of abuse:

If after investigation by the Department of Human Services or final disposition by the youth court or family court allegations of child abuse are found to be without foundation, the chancery court shall order the alleging party to pay all court costs and reasonable attorney’s fees incurred by the defending party in responding to such allegation.

(Emphasis added).

¶12. In this case, the chancellor ordered Nicole to pay Michael’s attorney’s fees and the GAL fees as follows:

With regard to [Michael’s] claims for attorney’s fees, the [c]ourt finds that the allegations made by [Nicole] are without foundation and furthermore that she was found in contempt . . . . As such, all the [GAL] fees are hereby [assessed] to [Nicole]. [Nicole] shall pay the [GAL] her remaining fees in the amount of $1,200.00 along with reimbursing [Michael] the [GAL] fees he initially paid in the amount of $1,500.00 within sixty (60) days of September 26, 2011.

After examining the [McKee factors], the [c]ourt finds that [Michael] is entitled to attorney’s fees in the amount of $8,076.01[,] which the [c]ourt finds were reasonable and necessary in prosecuting the contempt case against [Nicole], and further in defending the unsubstantiated allegations of abuse and/or neglect[,] and a judgment is hereby entered for the same. As such[,] a total judgment is hereby entered against [Nicole] in the amount of $9,733.91 in favor of [Michael], which shall be paid within sixty (60) days of September 26, 2011[,] along with the remaining $1,200.00 in [GAL] fees[,] which shall be paid directly to the [GAL] within sixty (60) days of September 26, 2011[.]

¶13. We cannot say that the chancellor abused his discretion in awarding attorney’s fees to Michael for his successful prosecution of the contempt charges against Nicole or for his defense against the baseless allegations of abuse. We also find that the chancellor did not abuse his discretion in ordering Nicole to pay the GAL fees. The chancellor found Nicole in contempt for claiming the children as dependents on her 2008 tax return and for withholding one of the children from Michael on one occasion. The chancellor did not find Michael in contempt for any of the claims asserted by Nicole. Additionally, the chancellor determined that Nicole’s allegations of abuse against Michael were unsubstantiated. The chancellor’s order was clear that the fees were awarded because of the unsubstantiated abuse allegations and because of Nicole’s contemptuous conduct.

¶14. While Michael is certainly entitled to an award of attorney’s fees for the contempt and for his defense against the abuse allegations, it is not clear that the total amount of $8,076.11 is only for the contempt and defense against the abuse allegations. In fact, an exhibit shows that at least part of the fees awarded were for the modification-of-child-custody proceedings. As such, the court erred in awarding the full amount of the attorney’s bill. Although there may be difficulty in allocating the attorney’s fees, the chancellor should nonetheless make that determination. Therefore, the amount of the award of attorney’s fees is reversed and this issue is remanded to the chancellor for a determination of the amount of attorney’s fees that should be awarded to Michael for the contempt proceedings and defense against the baseless abuse allegations.

So another attorney’s fee award bites the dust for lack of an essential finding. It’s not clear from the opinion whether the chancellor had all the information he needed to make the allocation of fees as lucid as it could or should have been.

Remember to give the judge all the essential information he or she needs to make a decision that would stand up if there is an appeal. All the judge needed here was time records or testimony to show how the hours devoted to the case by the attorney were spent as to each issue. There is no one who knows that better than the attorney who did the work. Naturally, there will be some judgment calls as to how to categorize various activities, but that is what cross examination is for, isn’t it?

While we’re on the issue of attorney’s fees, the COA touched on Michael’s request for an appellate attorney’s fee:

¶15. Michael also asks this court to order Nicole to pay his attorney’s fees on appeal. “When allowed, this Court has generally granted attorney’s fees in the amount of one-half of what was awarded [by the chancellor].” Carroll v. Carroll, 98 So. 3d 476, 483 (¶26) (Miss. Ct. App. 2012) (citing Lauro v. Lauro, 924 So. 2d 584, 592 (¶33) (Miss. Ct. App. 2006)). However, because Nicole prevails on this issue, Michael is not entitled to attorney’s fees on appeal.

ATTORNEY’S FEES AND ABILITY TO PAY POST-DIVORCE

May 16, 2013 § 1 Comment

It’s a well-settled principle of Mississippi law that a prerequisite to an award of attorney’s fees in almost all non-contempt cases is proof that the claiming party does not have the ability to pay his or her own attorney’s fees. It’s something we’ve posted about here before.

What about where the spouse claiming an award of attorney’s fees has a present or pre-existing inability to pay, but the equitable distribution award makes adequate provision, leaving no discrepancy?

The COA addressed that very question in Jones v. Jones, rendered April 30, 2013. In reversing the chancellor’s award of attorney’s fees and expert-witness expenses, the COA, per Judge Maxwell, stated:

¶37. We also reverse the award of $18,250 for attorney’s fees and expert-witness expenses. “The question of attorney’s fees in a divorce action is a matter largely entrusted to the sound discretion of the trial court.” Watson v. Watson, 724 So. 2d 350, 356-57 (¶29) (Miss. 1998) (quoting Ferguson, 639 So. 2d at 937). But when “a party is financially able to pay her attorney, an award of attorney’s fees is not appropriate.” Id.

¶38. In Watson, though “reluctant to disturb a chancellor’s discretionary determination whether or not to award attorney[’s] fees,” the supreme court reversed and rendered an award of attorney’s fees because, “with respect to the financial position of the parties after the divorce decree, it [was] evident that [the wife was] financially able to pay for her own attorney’s fees.” Id. at 357 (¶30) (emphasis added); see also Pacheco v. Pacheco, 770 So. 2d 1007, 1012-13 (¶¶26-28) (Miss. Ct. App. 2000) (affirming denial of attorney’s fees because wife’s property award enabled her to pay her attorney’s fees). Here, in finding Jane unable to pay, the chancellor did not consider Jane’s financial position in light of the divorce decree and property division. Jane was awarded almost two hundred thousand dollars in cash, secured by a lien on John’s real property and businesses, a home in Oxford free and clear of any liens, and dividend-paying bank stock, as well as multiple retirement accounts. As in Watson, under the circumstances, we find the award of attorney’s fees and expert-witness expenses to be an abuse of discretion. We reverse and render this portion of the judgment.

As I have said here before, one would think that attorneys would be super-zealous in making an airtight record on attorneys fees, but in my experience the proof is quite often slap-dash and incomplete.

If you want to make your award of attorneys fees bullet-proof, make sure that there is proof in the record to support a finding by the chancellor that, even with the equitable distribution, your client has an inability to pay. Is the equitable division readily liquidable, or is the bulk of it tied up in equity? Will liquidation to pay attorney fees have adverse tax consequences, as with an IRA? Will payment of attorney fees use up most, or all, of your client’s cash? Will it take months or even years to collect all of the equitable distribution? All of these are factors that the judge will consider if you make sure to put supporting proof in the record. With that kind of proof in this case, Jane might have had at least a partial, viable claim for attorney fees that would have survived on appeal.

VANISHING ATTORNEY’S FEES IN A PATERNITY ACTION

March 21, 2013 § 2 Comments

Tash Solangi filed suit against Kasey Croney to establish paternity and to obtain custody of the parties’ minor child, Caleb. Much of the trial was devoted to the parties’ custody conflict. At the conclusion of the hearing, the court awarded Kasey physical custody, gave the parties joint legal custody, changed the child’s name, and assessed child support. The chancellor also awarded Kasey a judgment in the sum of $14,000 in attorney’s fees. Tash appealed.

Much of the COA’s opinion in Solangi v. Croney, handed down March 12, 2013, addresses the chancellor’s findings on the Albright factors, which the COA did not disturb. It is the court’s handling of the attorney’s fee issue to which we turn out attention. Judge Fair’s opinion states:

¶28. The chancellor awarded Kacey approximately $14,000 in attorney’s fees and costs. The award was based on Mississippi Code Annotated section 93-9-45 (Rev. 2004), which provides that the defendant in successful paternity actions shall pay costs and attorney’s fees. There are two problems with this award. The first is that the trial from which the award largely derives was for custody rather than paternity, with paternity being admitted by the parties in their initial pleadings. The second problem is more fundamental: the statute states that costs and fees shall be assessed against the defendant. Given that Kacey was the defendant, section 93-9-45 does not authorize an award of costs and fees against Tash.

¶29. We recognize that the issue of attorney’s fees in domestic cases is largely entrusted to the sound discretion of the chancellor. McKee v. McKee, 418 So. 2d 764, 767 (Miss. 1982). Therefore we must also consider the possibility that the award can be justified under the McKee factors. However, that would require that Kacey be unable to pay her own fees. See Dunaway v. Dunaway, 749 So. 2d 1112, 1120 (¶20) (Miss. Ct. App. 1999). No such finding was made by the chancellor, nor would the record support it given that Kacey and Tash were of similar means, with Kacey earning approximately $72,000 per year.

¶30. We conclude that the award of fees and costs to Kacey is unsupported by the record and must be reversed and rendered.

Two points: (1) if you rely solely on the paternity (parentage) statute for authority to award an attorney’s fee, you’d better be representing the plaintiff; and (2) if the case is not for contempt, you must prove inability to pay. and although Judge Fair does not mention it here, he has said recently in another opinion, that in every case you should put on proof of the Mckee factors; otherwise there is nothing in the record to show how the chancellor arrived at a decision that the dollar amount awarded was reasonable.

And another point: I would have offered proof of how much time was devoted to the custody action and how much was devoted to the paternity action. That way, if the judge finds only part allowable, she has a record on which to base a partial award.

If you will click on that category search button up there on the right side of the page and again click on “Attorney’s Fees,” you will find a slew of posts on proving attorney’s fees and protecting the award on appeal.

MUCH ADO ABOUT SOMETHING

March 18, 2013 § 2 Comments

Forbes v. St. Martin, et al., decided March 5, 2013, by the COA, is a tour de force on contingent fee contracts and their enforceability. If you do any contingent-fee work, this is a must-read for you. Actually, it’s a good opinion to read and examine as a case study in ethics.

The 41-page majority opinion was penned by Judge Griffis. The rest of the court went this way: “ISHEE, ROBERTS, CARLTON AND FAIR, JJ., CONCUR. BARNES, J., CONCURS IN PART AND THE IN RESULT WITHOUT SEPARATE WRITTEN OPINION. MAXWELL, J., CONCURS IN PART AND IN THE RESULT WITH SEPARATE WRITTEN OPINION, JOINED IN PART BY ROBERTS, J. IRVING, P.J., DISSENTS WITH SEPARATE WRITTEN OPINION, JOINED BY LEE, C.J. JAMES, J., NOT PARTICIPATING.”

James Forbes had suffered catastrophic injuries in a gas-station explosion in Biloxi. Through a series of events he came to be represented in his personal injury claim by St. Martin, a Louisiana lawyer. Rather than qualifying to proceed pro hac vice, St. Martin instead associated a Mississippi lawyer and kept a rather low profile in the case, advising Forbes and his wife in the background and letting Mississippi counsel, with whom he corresponded regularly, take the lead in the record of the litigation.

The PI case was settled eventually for $13.6 million, and St. Martin’s fees, which were to be divided with Mississippi counsel, were $4.6 million.

Forbes filed suit against St. Martin and the Mississippi lawyer, and their respective firms, seeking to void the contingent-fee contract. The complaint asserted claims for breach of fiduciary duty, professional negligence, fraud and misrepresentation, conversion, rescission, imposition of a constructive trust, quantum merit, attorney’s fees, and actual and punitive damages. The Mississippi lawyer and his firm were dismissed, and St. Martin’s malpractice carrier was added as a defendant.

Both Forbes and St. Martin filed motions for summary judgment, and the chancellor ruled in favor of St. Martin.

The COA reversed and remanded. The ruling is too involved to go into detail here, but the court ruled that Forbes had presented enough evidence that there did exist a genuine issue of material fact so that summary judgment should not have been granted. Some of the findings of the COA:

St. Martin made over $100,000 in “cash advances” to the Forbes, which they spent on a Bahamian vacation, a Caribbean cruise, a car, a cell phone, and “other personal expenses,” in violation of Rule 1.8(e) of the Rules of Professional Coduct;
Unauthorized practice of law by St. Martin in Mississippi;
The first contingent-fee contract was made while Forbes was under influence of narcotics;
The second contract may have been the product of misleading or even fraudulent advice;
Portions of the contract pertaining to ability to settle without counsel and ability to terminate counsel were in violation of Mississippi’s professional conduct rules.

So St. Martin returns to trial in chancery unless he can convince the MSSC to take the case on cert. That could happen if the MSSC wants to clarify the law in this area. Or, the high court could let the case finish its run through the trial court and then entertain it later. With millions at stake, it’s inconceivable that a later appeal would not result no matter what the ultimate trial outcome.

An interesting aspect of this case is that it is in essence a malpractice claim based on breach of fiduciary duties, which is not the usual and customary avenue that plaintiffs pursue in these cases.

The question at the heart of this appeal is whether an out-of-state lawyer may enter into an agreement with a Mississippi lawyer for joint representation of Mississippi litigants in a way that the out-of-state lawyer may avoid coming within the restrictions of the Mississippi rules of professional conduct and the scrutiny of our courts. The answer of the COA is “no.”

A subsidiary question is raised in Judge Maxwell’s partially concurring opinion, which challenges the majority’s definition of the practice of law. Judge Maxwell would not define it as expansively as did the majority. In my opinion, if the supreme court decides this phase of the case merits a look, this will be the battleground issue.

ATTORNEY’S FEES REVISITED

January 15, 2013 § Leave a comment

I sometimes quip that our body of case law is reaching biblical proportions, meaning that one can find authority to support opposite sides of most issues, and sometimes three or more sides.

Take the matter of attorney’s fees. It used to be fairly clear that in all but contempt you had to prove inability of the party to pay and the claim had to be proven reasonable via the McKee factors. In contempt actions proof of inability to pay is not relevant because the award is punitive.

Last September I posted here about the COA’s Bowen case, which reiterated the contempt rule, and remanded for proof of reasonableness under McKee. That post includes links to other posts on the subject of attorney’s fees.

In Brown v. Weatherspoon, decided by the COA on November 6, 2012, Kenyader Weatherspoon had produced DNA results proving conclusively that he was not the father of a child born to Serhonda Brown. Weatherspoon filed an MRCP 60(b) action seeking to set aside a prior judgment, to which he had agreed, establishing child support. Brown contested the 60(b) petition, and she persisted in a collection effort for unpaid child support. She also testified that she knew the identity of the natural father, and that she had no intention of suing him for child support. Based on Brown’s position, the chancellor assessed Brown $9,210 in attorney’s fees incurred by Weatherspoon in the case. Brown appealed.

In her appeal, Brown argued that she had the right to defend against the 60(b) action, and further that Weatherspoon would have incurred the fees anyway in the prosecution of his petition. She also argued that Weatherspoon failed to prove either inability to pay or the McKee factors.

Judge Roberts, writing for the COA, said:

¶22. The award of attorney’s fees is generally left to the discretion of the chancellor. Arthur v. Arthur, 691 So. 2d 997, 1004 (Miss. 1997) (citations omitted). “We are reluctant to disturb a chancellor’s discretionary determination whether or not to award attorney[’s] fees and of the amount of any award.” Id. (citation and internal quotation omitted). The chancellor based her decision to award Weatherspoon attorney’s fees on Brown’s vigorous insistence that Weatherspoon pay child support when, based on the DNA test results, Brown knew Weatherspoon was not M.B.’s father. The chancellor also noted that Brown knew the identity and whereabouts of the man she believes to be M.B.’s biological father, but she chose not to pursue paternity testing or child support from him. In her order, the chancellor referenced the fact that when Brown was asked why she had not sought child support from M.B.’s biological father, Brown responded that “she just did not want to.”

¶23. Furthermore, in McKee, the supreme court held that an award of attorney’s fees based on an estimated 850 hours worked on the case was too speculative to support the award. McKee, 418 So. 2d at 766-67. But when a chancellor bases an award of attorney’s fees on an itemized bill, there is substantial evidence to support the chancellor’s award. Dobbins v. Coleman, 930 So. 2d 1246, 1252 (¶27) (Miss. 2006). Weatherspoon submitted itemized bills from his attorney. The chancellor based her award on those itemized bills. Consequently, we do not find that the chancellor abused her discretion.

This was not an award of attorney’s fees based on contempt, so it is unclear why inability to pay was not a factor. The award was, however, in the nature of a sanction, since the chancellor was clearly punishing Sheronda for pursuing the futile action and thereby, I suppose, inflating both sides’ legal bills.

As for reasonableness, it would appear that either McKee proof or itemized bills will accomplish the same purpose. In other words, there must be something substantial in the record to support the chancellor’s finding that the fee award is reasonable. As I have said here before, my suggestion is that you put on proof of both the McKee factors and documentation of your time in the case, so that both are in the record if you need them.

REASONABLENESS AND ATTORNEY’S FEES IN CONTEMPT

September 17, 2012 § 4 Comments

In the COA case of Bowen v. Bowen, decided September 11, 2012, the court reversed and remanded the chancellor’s award of $10,000 fees in a case where the judge found the defendant in contempt. It was not the award of fees that the COA questioned, but rather the amount and reasonableness.

As we have mentioned here before, inability to pay is not a threshhold issue to an award of attorney’s fees based on contempt. In a contempt case, attorney’s fees may be awarded where a party’s intentional conduct causes the opposing party to spend time and money needlessly.

Judge Ishee’s opinion in Bowen points out that the determination whether a fee is reasonable depends on consideration of Mississippi Rule of Professional Conduct 1.5(a) and the McKee factors. He said:

” … even in contempt actions, “[t]he reasonableness of attorney’s fees [is] controlled by the applicable [Rule] 1.5 factors and the McKee factors.” …

¶25. When awarding Patricia attorney’s fees, the chancery court stated:

‘Although [John] has attempted to purge himself of his contempt by bringing the child support and medical insurance payments current, . . . the [c]ourt is going to assess [John] with attorney’s fees incurred by [Patricia]. If not for [John’s] repeated, willful refusal to abide by the orders of this court, [Patricia] would not have incurred the attorney’s fees, which the court finds to be reasonable and [to] meet all of the McKee factors.

There is no indication the chancery court adequately considered the McKee factors when assessing the reasonableness of the attorney’s fees. There was no consideration regarding the parties financial abilities, the novelty and difficulty of the question at issue, or the assessment of the charges.

¶26. The case at hand appears to be a routine contempt action. While large awards for attorney’s fees may still be awarded in contempt actions, they are not typical for a routine contempt action. … Here, an award of $10,000 appears excessive for a routine contempt action in which only $135 in child support remains unpaid. Furthermore, upon a review of the fees incurred, some charges relate to matters outside of the contempt action, such as modification of child support. Because the attorney’s fees were awarded based on John’s ‘repeated, willful refusal to abide by the orders of [the chancery court],’ fees not related to the contempt action should not have been included in the award amount awarded.”

I’ve made the point here before that …

Notwithstanding the more relaxed standard for contempt and misconduct cases, I encourage you to put on proof of the McKee factors and documentation of your time in the case, so that it is in the record if you need it. A post on what you need to prove attorneys fees is here.

Most attorneys in my opinion do not devote much attention or care to making a record on attorney’s fees. That’s ironic, because you would think it would be a subject of sublime importance to the trial attorney.

Here’s a post about how to prove attorney’s fees in a divorce case. It’s more elaborate than the minimum required in a contempt, but it will give you an idea of what is involved in making a record that won’t spring a fatal leak.

STUNG BY ATTORNEY’S FEES

August 7, 2012 § 2 Comments

The usual standard in chancery court is that a party will not be entitled to an award of attorney’s fees unless the party proves an inability to pay. It’s a subject we’ve touched on before.

The exception to the rule is when the court finds a party in contempt. In that case, no inability to pay need be shown. And, when you represent the contemnor, you are wise to advise your client in advance to be prepared to get stung by those fees if the case is tried and he or she is on the losing side.

The latest manifestation of these principles is in the COA case of Rogers v. Rogers, decided July 25, 2012. In Rogers, the chancellor had found Mr. Rogers to have perpetrated a fraud on the court and assessed him with $1,605 in his ex-wife’s attorney’s fees. The COA reversed the finding of fraud (subject of another post), and Mr. Rogers complained that (a) there was no basis to assess fees absent the fraud finding, and (b) that there was insufficient evidence to support the award. Here’s the pertinent part of Judge Carlton’s decision:

¶29. Our jurisprudence generally provides that “[a]n 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) (citations omitted). Additionally, a chancellor may also award attorney’s fees based on a party’s wrongful conduct, as stated in Chesney v. Chesney, 849 So. 2d 860, 863 (¶12) (Miss. 2002), as follows:

There have been a number of prior decisions upholding the award of attorney’s fees to one party where the other party has been found to be in contempt of court or where that party’s actions caused additional legal fees to be incurred. See A & L, Inc. v. Grantham, 747 So. 2d 832, 844-45 [(¶60)] (Miss. 1999) (holding that awarding attorney’s fees under certain circumstances, regardless of the party’s ability to pay, is not a reward, but reimbursement for the extra legal costs incurred as a result of the opposing party’s actions); Douglas v. Douglas, 766 So. 2d 68, [72 (¶14)] ((Miss. Ct. App. 2000) (where a party who is entitled to the benefits of a previous judicial decree is forced to initiate further proceedings to gain compliance with the previous order of the court, an award of attorney’s fees is appropriate).

See also McCarrell v. McCarrell, 19 So. 3d 168, 172-73 (¶¶18-19) (Miss. Ct. App. 2009). Further, the issue of whether to award attorneys’ fees in a divorce case constitutes a discretionary matter left to the chancellor, and this Court is “reluctant to disturb” such a finding. Young v. Young, 796 So. 2d 264, 268 (¶11) (Miss. Ct. App. 2001).

¶30. Chancellors are instructed to apply the McKee factors in granting or denying attorney’s fees. See McKee v. McKee, 418 So. 2d 764, 767 (Miss. 1982). However, the chancellor’s September 28, 2010 final judgment, where the chancellor awarded Julianne $1,605 in attorney’s fees, shows no mention of, nor specific findings on, the McKee factors. The chancellor stated only that “evidence reflected that [Julianne’s] attorney’s fees and court costs totaled $1,605.”

¶31. Our supreme court has held where there is substantial evidence in the record supporting the chancellor’s award of attorney’s fees, the omission of specific findings cannot be deemed reversible error. See Varner v. Varner, 666 So. 2d 493, 498 (Miss. 1995) (no McKee findings); Prescott v. Prescott, 736 So. 2d 409, 416 (¶31) (Miss. Ct. App. 1999) (no finding of inability of recipient to pay). We further note that a specific, on-the-record finding of inability to pay is not necessary where attorney’s fees are awarded due to the other party’s failure to comply with discovery requests. Russell v. Russell, 733 So. 2d 858, 863 (¶16) (Miss. Ct. App. 1999). A specific finding of inability to pay is also not required when attorneys’ fees are assessed against a party found to be in contempt. Mount v. Mount, 624 So. 2d 1001, 1005 (Miss. 1993).

¶32. In the case before us, the chancellor recognized Charles’s continued failure and refusal to comply with the divorce decree, including his failure to make alimony payments, failure to provide medical-insurance coverage, and failure to pay Julianne’s uncovered medical expenses. The chancellor also found Charles in contempt of court for his failure to provide adequate medical-insurance coverage for Julianne. For these reasons, we affirm the chancellor’s award of attorney’s fees to Julianne. This assignment of error is without merit.

The significance of Rogers with respect to attorney’s fees awards is two-fold: (1) it reiterates the rule that the inability-to-pay test is inapplicable when the assessment of fees is due to contempt or misconduct; and (2) it clarifies that the amount of proof and documentation necessary to support the award for contempt or misconduct is not as great as in an inability-to-pay case.

PROTECTING YOUR ATTORNEY’S FEES AWARD IN A DIVORCE CASE

April 9, 2012 § 5 Comments

When you have worked hard on a case and prevailed, you’d like to be adequately compensated. You put on your proof of attorney’s fees and the judge makes a handsome award. Only problem is, the other side appeals and the COA tosses out your award, much to your chagrin. How should you have bulletproofed that award?

In the case of Alexander v. Alexander, decided March 27, 2012, the chancellor had awarded Amanda Alexander a judgment for nearly $32,000 in attorney’s fees in a divorce action against her husband, Khari. The COA reversed the special chancellor’s decision for failure of to make any findings of inability to pay or about the reasonableness of the request. Here’s what the opinion said on the point:

“An award of attorney[’s] fees is a matter largely within the sound discretion of the chancellor.” Dickerson v. Dickerson, 34 So. 3d 637, 648 (¶43) (Miss. Ct. App. 2010) (citing Smith v. Smith, 614 So. 2d 394, 398 (Miss. 1993). “Attorney[’s] fees should only be awarded in an amount that compensates for services rendered.” Id. at (¶44) (citing McKee v. McKee, 418 So. 2d 764, 767 (Miss. 1982)). The factors to be analyzed in determining whether to award attorney’s fees include: (1) “the relative financial ability of the parties;” (2) “the skill and standing of the attorney employed,” (3) the novelty and difficulty of issues in the case, (4) the responsibility required in managing the case, (5) “the 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. McKee, 418 So. 2d at 767.

¶15. The testimony showed Khari earned approximately $90,000 a year; however, Khari did not file a financial statement pursuant to Uniform Chancery Court Rule 8.05. Amanda asserts that her inability to pay her attorney’s fees was proven because the chancellor found her household expenses exceeded her income. The chancellor made no findings of fact on the issue of her inability to pay or Khari’s ability to pay. An itemized bill from Amanda’s attorney is included in the record; however, the chancellor did not examine the reasonableness of the fees. Before attorney’s fees are awarded, the chancellor must determine if the fees were fair, reasonable, and necessary. Dickerson, 34 So. 3d at 648 (¶44) (citing McKee, 418 So. 2d at 767). Since the chancellor failed to make findings pursuant to the McKee factors, we also reverse and remand on this issue.

In a divorce case, the party seeking an award of attorney’s fees must prove inability to pay. Deen v. Deen, 856 So.2d 736, 739 (Miss.App. 2003); Duncan v. Duncan, 915 So.2d 1124, 1128 (Miss.App. 2005); Sullivan v. Sullivan, 43 So.3d 536, 541 (Miss. App. 2010). Ability of the opposing party to pay must also be considered. Sarver v. Sarver, 687 So.2d 749, 756 (Miss. 1997).

Interestingly, the COA decision had already reversed and set aside the divorce in Alexander for failure to prove grounds before it addressed the award of attorney’s fees. There is no mention of the effect of that reversal on the fee award.

So what could counsel here have done to protect the attorney’s fees? Here are a few suggestions:

It’s axiomatic that if you don’t put on the proper proof, the chancellor will not have the basis to make an adequate ruling. Print out the McKee factors and address every single one of them in your testimony. Don’t skip or skimp on anything! There is case law to the effect that, even if the chancellor never mentions McKee, he will presumed to have considered the factors IF there is evidence in the record that supports the award.
Make sure you have adequate time records or other documentation in support of your testimony as to time spent, expenses, work done, and put your records into evidence. Here is a link to a helpful post on what you need to prove to get that award of attorney’s fees.
If you feel that the chancellor has not made sufficient findings, file a Rule 59 motion and ask the judge to supplement his findings. Better yet, provide him or her with proposed findings of fact and conclusions of law on the point that address every applicable McKee factor.

When you have worked hard on a case, you want and deserve to be paid. Sometimes your client won’t be able to pay you, and your only realistic option is to look to the other party. Don’t leave it to chance. Make a bulletproof record.

THE HIGH PRICE OF A LITIGATION MISFIRE

March 19, 2012 § Leave a comment

Litigation Misfire. (noun): 1. Litigation that fails to ignite at the proper point 2. A case that blows up in one’s face. 3. Any case in which none or few of the positive points your client told you about her case ever materializes at trial.

We’ve all had our misfires. No need to catalog them here. Some misfires happen despite your best efforts and most professional approach to the case. Others are the direct result of a lawyer’s failure to do his homework. When the misfire falls in the latter category, it can dearly cost your client, or you, or both of you. The cost of a misfire can be a daunting thing.

In the COA case of McKnight v. Jenkins, decided March 13, 2012, the tab came to $23,969.17. Here is what Judge Lee’s opinion said, beginning at ¶ 14:

“The chancellor ordered Holly to pay $19,956.67 in Walter’s attorneys’ fees and $4,012.50 in GAL fees. The chancellor found Walter’s attorneys’ fees had been incurred for his defense of the abuse and contempt allegations. The chancellor found sanctions would be appropriate due to Holly’s unsubstantiated slander of the chancellor who had previously been involved in the case; however, the chancellor did not attribute a specific amount of his award as sanctions. In regard to the contempt action, “[a] chancellor is justified in awarding attorney’s fees that are incurred in pursuing a contempt motion.” Elliott v. Rogers, 775 So. 2d 1285, 1290 (¶25) (Miss. Ct. App. 2000). In regard to Walter’s defense of the abuse allegations, the chancellor relied upon Mississippi Code Annotated section 93-5-23 (Supp. 2011), which requires a party alleging child abuse to pay court costs and reasonable attorneys’ fees incurred by the defending party if the allegations are found to be without merit. The chancellor found, pursuant to McKee v. McKee, 418 So. 2d 764 (Miss. 1982), the attorneys’ fees incurred by Walter were reasonable and necessary. We can find no abuse of discretion by the chancellor in awarding Walter attorneys’ fees.

¶15. In regard to the GAL fees, the chancellor determined Holly’s unfounded abuse allegations were the reason he appointed a GAL; thus, the chancellor contended Holly should be responsible for the GAL’s fees. Section 93-5-23 also requires the party alleging child abuse to pay court costs in addition to attorneys’ fees. GAL fees have been considered court costs. Foster v. Foster, 788 So. 2d 779, 782 (¶8) (Miss. Ct. App. 2000). Thus, it was proper for the chancellor to order Holly to pay the GAL fees.”

You can add to the ouch factor in this case the fact that Holly was unemployed at the time she was assessed these fees and costs. It matters not what her ability to pay is when the fees are assessed for contempt.

It goes without saying, or should, that you need to investigate the claims that your client brings to you, no matter how tempting that cash retainer looks. MRCP 11(a) specifically says that when the attorney signs the pleading as required:

The signature of an attorney constitutes a certificate that the attorney has read the pleading or motion; that to the best of the attorney’s knowledge, information and belief there is good ground to support it; and that it is not interposed for delay.

Those words are there for a reason. They impose an important and serious duty on you as an officer of the court not to burden the courts, opposing parties and counsel with frivolous or unfounded matters, to limit your pleadings only to those that genuinely state a cause of action, and to do your homework before you ever set the wheels of the courts in motion.

The payback for not complying with MRCP 11(a) is set out in MRCP 11(b). It’s interesting reading, and I won’t spoil the surprise for you by repeating it here, but you really should read it for yourself and not hear it for the first time from the bench. On March 15, 2012, the Mississippi Supreme Court upheld 11(b) sanctions in a case out of Rankin County, In Re Guardianship of B.A.D., which reversed and remanded on other grounds. You should read that case for its exposition of what it is like to face the wrath of a chancellor.

Don’t overlook Rule 2.1 of the Rules of Professional conduct, which requires you to act as an advisor to your client. As I have said here many times, you are not a mere clerk-typist for your client. Nor are you merely your client’s robotic alter ego. You are an independent professional whose highest duty is to advise. As a wise man once said, “About half the practice of a decent lawyer consists of telling would-be clients that they are damned fools and should stop.”

MCA § 93-5-23 states “If, after investigation by the Department of Human Services or final disposition by the youth court or family court allegations of abuse are found to be without foundation, the chancery court shall order the alleging party to pay all court costs and reasonable attorney’s fees incurred by the defending party in response to such allegations.” The chancellor in McKnight could possibly have relied on that section, since he found the allegations to have been without foundation. I have taken the position that all of the elements of the statute have to be present in order to require the imposition of sanctions; i.e., there must be an investigation by DHS or final disposition by a youth court or family court, with a finding that the charges are without foundation. I refused to impose the statutory sanctions in a case where DHS found that the charges could not be substantiated because, by the time they investigated, the bruises on the child were too faded to make a clear finding. The fact that there were bruises convinced me that the charges were not “without foundation” within the meaning of the law, and DHS did not say they were without foundation. To me, sanctions should be carefully limited to appropriate cases so as to avoid a chilling effect on family members, neighbors, doctors, school officials and others who are in a position to report and perhaps put a stop to child abuse.

The Litigation Accountability Act, MCA 11-55-1, et seq. is something else to watch out for. It provides a cause of action against an attorney or party for meritless action, claim or defense, or for unwarranted delay or for “unnecessary proceedings.”

A caveat … the fact that I personally set a high threshhold for sanctions should not lead you to relax your standards. Professionalism demands it. And as a practical matter, your judge may see sanctions differently. I once saw a judge pop a lawyer, not her client, with a $1,500 sanction for failure to answer interrogatories after being ordered to do so. And I myself even assessed more than $20,000 in a case that had been tried by my predecessor, and which was reversed and remanded on a finding of no jurisdiction; the case law is clear that to pursue a case where there is no jurisdiction after you were put on notice is sanctionable, even where the chancellor allowed you to proceed to final judgment.

In my opinion, all sanctions should be judiciously weighed and never lightly imposed. Some lawyers seem to add requests for sanctions to almost every pleading they file, although those requests are, wisely, seldom presented for adjudication. Seems to me that the old saw, “what goes around comes around,” has particularly apt application to this subject.

Where Am I?