attorney’s fees | The Better Chancery Practice Blog

Attorney’s Fees in Lieu of Punitive Damages

April 6, 2020 § Leave a comment

Allen Cronier got into a property dispute with two businesses owned by the Rainwater brothers. The dispute spilled into chancery court, and, following a trial, in which the chancellor ruled against him and awarded attorney’s fees, Cronier appealed. The COA affirmed in part, but reversed in Cronier v. ALR Partners L.P., 248 So. 3d 861, 864 (¶1) (Miss. Ct. App. 2017), cert. denied, 247 So. 3d 1264 (Miss. 2018). The court remanded for a determination by the chancellor whether the award of attorney’s fees against Cronier was in lieu of punitive damages.

Here is a recap of the case from Cronier v. ALR Partners, et al., decided by the COA on March 10, 2020:

¶2. Cronier purchased a parcel of land in Jackson County in July 2012. Id. at 865 (¶¶2-3). [Fn omitted] At the time, Cronier believed that the parcel comprised eighty acres, though he did not have the property surveyed before he purchased the property to verify that understanding. Id. Cronier had the property surveyed later. Id. at (¶3). The survey revealed that the parcel he had purchased was only about seventy acres and that there was a boundary issue with the adjoining property owned by the Rainwaterses. Id. at (¶¶3-5). The survey also indicated that the property corners and boundaries were marked with posts, the remains of old fences, and yellow paint blazes on trees. Id. At a post-survey meeting between Cronier and the Rainwaterses, before Cronier abruptly left, Cronier announced that “he had paid for eighty acres and said, ‘by God I’m going to get eighty acres . . . . I know what I’ve got to do.’” Id. at 866 (¶6). Following this meeting, the Rainwaterses went to inspect the property and found that certain old boundary markers were missing. Id. at (¶7). In March 2013, Cronier informed the Rainwaterses that he had conveyed the disputed property to his minor granddaughter. Id. at (¶8). The Rainwaterses visited the property again and discovered that more boundary markers had been removed or defaced. Id. at (¶9). Cronier later built a fence and gate around the perimeter of the property, including the disputed ten-acre parcel. Id. at (¶11).

¶3. This litigation ensued. Id. at (¶¶10-11). The Rainwaterses asserted claims against Cronier for trespassing, compensatory and punitive damages, and attorney’s fees. Id. In March 2016, the chancellor ruled in favor of the Rainwaterses on their claim of adverse possession of the 9.57 acres at issue, and the court entered a final judgment to this effect in April 2016. Id. at 868 (¶19). On December 12, 2017, we affirmed the court’s judgment regarding adverse possession, but we reversed and remanded in part “for clarification of whether punitive damages were awarded in the form of attorney fees.” Id. at 871-72 (¶39) (citing Pursue Energy Corp. v. Abernathy, 77 So. 3d 1094, 1102 (¶26) (Miss. 2011); AquaCulture Tech. Ltd. v. Holly, 677 So. 2d 171, 184 (Miss. 1996)).

¶4. On January 29, 2018, before the mandate issued from this Court, [Fn omitted] the chancery court entered a final judgment on remand, finding that “Cronier acted with actual malice” and ordering Cronier to “pay the Rainwaters[es’] attorney’s fees in the amount of $10,790.00 in lieu of punitive damages.” Cronier filed a motion to set the judgment aside based on the chancery court’s lack of jurisdiction pending the final disposition of his appeal. On February 14, 2018, the chancery court entered an agreed order setting aside its January 29, 2018 final judgment.

¶5. On October 1, 2018, after the appeal was final, the chancery court entered its final judgment. In it, the chancellor adopted and incorporated the findings contained in the January 29, 2018 final judgment. Specifically, the chancellor found that Cronier had “acted with actual malice, and [Cronier] shall pay the Rainwaters[es’] attorney’s fees in the amount of $10,790.00 in lieu of punitive damages.” Relying on Pursue Energy and Holly, the chancellor clarified that attorney’s fees were awarded in lieu of punitive damages “due to [Cronier’s] actions, which included erecting a fence around the property in clear disregard of the Rainwaters[es’] rights and conveying property to his minor granddaughter when he knew there was a serious claim for the subject property.” Cronier now appeals from this judgment.

In his second appeal, Cronier argued that the chancellor erred in awarding attorney’s fees in lieu of punitive damages, and that the evidence was insufficient to support the judge’s findings. Judge Greenlee wrote for the 9-1 court:

¶7. On appeal, Cronier contends that the chancellor erred in awarding attorney’s fees in lieu of punitive damages. Specifically, he contends that the evidence is insufficient to support the chancellor’s finding that he acted with “actual malice,” such that the award of attorney’s fees in lieu of punitive damages was improper.

¶8. “Mississippi follows the general rule that, in the absence of a contractual agreement or statutory authority, attorney’s fees may not be awarded except in cases in which punitive damages are proper.” Tunica County v. Town of Tunica, 227 So. 3d 1007, 1027 (¶49) (Miss. 2017) (citing Grisham v. Hinton, 490 So. 2d 1201, 1205-06 (Miss. 1986)). Generally, punitive damages may only be awarded when a plaintiff proves “by clear and convincing evidence that the defendant against whom punitive damages are sought acted with actual malice, gross negligence which evidences a willful, wanton or reckless disregard for the safety of others, or committed actual fraud.” Miss. Code Ann. § 11-1-65(1)(a) (Rev 2014); see also Wise v. Valley Bank, 861 So. 2d 1029, 1034 (¶15) (Miss. 2003) (“[T]he plaintiff must demonstrate a willful or malicious wrong, or the gross, reckless disregard for the rights of others.”). “[A]n actual award of punitive damages is not a prerequisite for an award of attorney’s fees; rather, attorney’s fees are warranted where ‘the awarding of punitive damages would have been justified,’ even if punitive damages are not awarded.” Tunica County, 227 So. 3d at 1029 (¶54) (quoting Holly, 677 So. 2d at 185). Thus, “attorney fees may be awarded instead of punitive damages.” Cronier, 248 So. 3d at 871 (¶39).

¶9. On remand, the chancellor found that Cronier acted with actual malice based on Cronier’s actions, “which included erecting a fence around the property in clear disregard of the Rainwaters[es’] rights and conveying property to his minor granddaughter when he knew there was a serious claim for the subject property.” Cronier responds that attorney’s fees are not proper and that the “conduct or conditions” required to award punitive damages are not present in this case. After reviewing the record, we find no manifest error in the chancellor’s finding of actual malice.

¶10. The record thus supports the chancellor’s finding that Cronier’s conduct justified an award of punitive damages. After Cronier’s surveyor revealed that the property Cronier purchased was only seventy acres, the parties met to discuss the issue. Cronier declared that he had paid for eighty acres and said, “[B]y God I’m going to get eighty acres . . . . I know what I’ve got to do.” Thereafter, the Rainwaterses discovered that boundary markers had been removed or defaced, and Cronier informed the Rainwaterses that he had conveyed the parcel, including the disputed land, to his minor granddaughter. Cronier also proceeded to erect a fence and gates around the property despite the dispute over title. The chancellor’s findings that Cronier acted with “actual malice” and in “clear disregard of the Rainwaters[es’]rights” are thus supported by substantial evidence, and the chancellor did not err in awarding attorney’s fees in lieu of punitive damages.

Two thoughts:

I see requests for attorney’s fees in all kinds of suits that aren’t divorce-related or contempts. Seldom does the proof rise to the level spelled out by Judge Greenlee in ¶8. If you are serious about pursuing that claim for fees, you’ve got to put adequate proof in the record. Paragraph 8 tells you what you need to prove.
And the moral of this story is: Although it’s true that self-help is always an option, it can cost you.

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.

Four Judges, and a Remand Makes Five

March 27, 2017 § 2 Comments

When Jon A. Swartzfager and Thomas R. Saul had a disagreement over the sale of some land, Saul filed suit in chancery court for breach of contract, equitable estoppel, and promissory estoppel.

The chancellor of the district recused, and the MSSC appointed Special Chancellor #1. That judge granted partial summary judgment and conducted some proceedings, in one of which he declared a written instrument to be a valid, enforceable contract. Before he got to a trial, however, Chancellor #2 unfortunately died.

Enter Chancellor #3. This time, the judge did set the case for trial, and it was heard on November 29, 2012, and January 25 and April 8, 2013. Before Chancellor #3 could render a final judgment, he, too, died.

The MSSC appointed Chancellor #4, who huddled with the attorneys and entered an order memorializing the parties’ agreement that he could review the existing record and render a decision. Chancellor #4 did just that, finding that Swartzfager had breached the contract, and awarding damages of more than $200,000, which included $79,098.81 in prejudgment interest. Swartzfager appealed.

In the case of Swartzfager v. Saul, decided February 16, 2017, the MSSC reversed in part and remanded. Essentially, the court affirmed everything but the award of prejudgment interest, and remanded for the chancellor to recompute damages without the prejudgment interest.

Only thing is, Chancellor #4 is now retired and is no longer sitting as a senior or special judge, so he will not be available to deal with the case on remand.

Enter Chancellor #5. Stay tuned.

A few interesting points from the decision by Justice Maxwell:

Swartzfager argued that the MSSC should review the case de novo because Chancellor #4 based his decision on testimony before previously-assigned chancellors; he also urged that the previous chancellors’ findings should be given no deference. The court rejected that claim at ¶18 on the principle of judicial estoppel. The parties had agreed to follow that procedure, and he is precluded from taking a contrary position at a later stage of the case.
Another point pressed unsuccessfully by Swartzfager was that it was error for the chancellor to adopt Saul’s findings of fact and conclusions of law verbatim. The court disagreed, pointing out that the judge made his own findings, including adopting some findings of previous chancellors. I might add that even if the chancellor had wholly adopted Saul’s findings, it was not error for him to do so. You can read a post about the subject here.
The reversal on the issue of prejudgment interest came about because Saul had not included a prayer for that relief in his complaint, and so he was precluded from getting that relief per MRCP 8. The court noted that, since the reversal was based on the state of the pleadings, and not on the merits, it did not need to address whether the damages were liquidated, or if there were bad faith, which are two of the bases necessary to support an award of prejudgment interest.
There’s a lot of substance in this case that you might find useful, including: what it takes for a writing to be a contract; equitable estoppel; emotional distress damages arising out of a contract dispute; and assessment of attorney’s fees in absence of punitive damages.

Karma is a B****, or What Goes Around Comes Around

April 7, 2015 § 1 Comment

John Bowen got into the habit around 2005 of not paying his child support. His ex, Patricia, had to retain an attorney to file repeated petitions for contempt. When he did begin complying — more or less — with the court’s child support orders, he did so by paying the child support into the registry of the court, which required Patricia to retain an attorney to get a judge to sign a court order authorizing the Chancery Clerk to disburse the funds to her.

In 2009, the chancellor found John in contempt and slapped him with $10,000 in attorney’s fees. John appealed, and the COA, in Bowen v. Bowen, 107 So.3d 166 (Miss. App. 2012), affirmed the finding of contempt, but remanded for the chancellor to make findings on the McKee factors.

On remand, the chancellor awarded Patricia $7,350 in attorney’s fees. John again appealed.

In Bowen v. Bowen, handed down March 24, 2015, the COA affirmed. Judge Roberts, hitting the nail on the head, wrote for the unanimous court:

¶5. John’s sole issue on appeal is that the chancery court erred in awarding Patricia $7,350 in attorney’s fees. On appeal, we employ the abuse-of-discretion standard when reviewing a trial court’s grant or denial of attorney’s fees. Proctor v. Proctor, 143 So. 3d 615, 623 (¶34) (Miss. Ct. App. 2014) (citing Miss. Power & Light Co. v. Cook, 832 So. 2d 474, 478 (¶7) (Miss. 2002)). In McKee v. McKee, 418 So. 2d 764, 767 (Miss. 1982), the Mississippi Supreme Court provided factors for consideration when determining the proper amount of attorney’s fees to award:

The fee depends on consideration of, in addition to the relative financial ability of the parties, the skill and standing of the attorney employed, the nature of the case and novelty and difficulty of the questions at issue, as well as the degree of responsibility involved in the management of the cause, the time and labor required, the usual and customary charge in the community, and the preclusion of other employment by the attorney due to the acceptance of the case.

¶6. Following this Court’s mandate, the chancery court held a hearing on the issue of attorney’s fees. Nancy Liddell, Patricia’s attorney, submitted into evidence an itemized bill for her work related to the case. She testified that in any instance where modification was mentioned in the bill, she halved the fee charged; thus, only the time spent working on the contempt action remained. Liddell additionally submitted an affidavit from a local attorney confirming that the range of $150-$200 per hour was the usual and customary rate for DeSoto County. John’s attorney did not dispute that these were the customary rates for DeSoto County. Patricia testified that she believed Liddell’s rate was reasonable, and that she “probably worried [Liddell] to death” with her constant communication. Patricia further elaborated that without Liddell’s aid, she would have been unable to get the owed child support from John. Liddell also testified that she expended many hours on this case, as it was more than just an average contempt action, and she had to turn away potential clients to handle this particular case.

¶7. In addressing the McKee factors in its oral ruling, the chancery court noted that the case was a novel case for a contempt action and had been ongoing since 2005. According to the chancery court, Patricia had to repeatedly file petitions for contempt because John would not obey court orders to pay child support. The chancery court explained that each time John failed to pay child support, Patricia “would have to talk to her attorney, have a petition filed, and after the petition [was] filed, after [John or his attorney were] served, then before [they] actually would have a trial, [John] would pay that child support. But he would not pay it directly to [Patricia].” When John did pay the child support, he would pay it to the chancery court, which required a signed order to release the check to Patricia, again requiring Liddell to prepare a motion for release of funds and an order to release the funds. The chancery court further stated that John, “by his repeated intentional misconduct[,] caused [Patricia] to incur attorney[’s] fees that she did not have money to pay[, o]ver and over and over again[,]” and Liddell successfully obtained relief for Patricia each time John failed to pay. The chancery court also found that Liddell was a skilled lawyer with over twenty years of experience, who missed other employment opportunities due to the constant work and preparation of this case. According to the chancery court, while this amount of attorney’s fees appeared high for an average contempt action, the $150-$200 per hour was a reasonable fee, and the bill would not have been as high if it were not for John’s repeated misconduct.

Patricia’s lawyer did a nice job of addressing the McKee factors with substantial proof. That gave the chancellor an adequate basis to support her ruling.

Remember that proof of McKee factors is not, strictly speaking, required to support an award of attorney’s fees in a contempt action; however, there must be some evidence of reasonableness. In other words, the chancellor has to have some basis to say that the award is reasonable. The best and most expeditious way to do that is via the McKee factors, as the COA ordered in this case.

Oh, and getting back to our starting point, did you notice how spiteful and intransigent John appeared to be in how he responded to the court’s orders to pay child support? Well, that’s where karma comes into play. Judge Roberts addressed the karma factor:

¶8. Based upon the evidence presented, we find that the chancery court did not abuse its discretion in awarding Patricia $7,350 in attorney’s fees. As the supreme court noted in Mabus v. Mabus, 910 So. 2d 486, 489 (¶8) (Miss. 2005), in contempt actions, “[w]here a party’s intentional misconduct causes the opposing party to expend time and money needlessly, then attorney[’s] fee and expenses should be awarded to the wronged party.” The chancery court found that the itemized expensed entered into evidence were reasonably incurred due to John’s repeated misconduct.

Karma is, indeed, a B****. Or, as we say in chancery court: Who seeks equity must do equity.

How Not to Prove Attorney’s Fees

November 24, 2014 § Leave a comment

Allene Crowell died in 2006. Her two surviving daughters, Caron Crowell and Jackie Trotter, were named co-executrixes.

Jackie filed a complaint charging that Caron had unduly influenced Allene to gift her an unfair share of Allene’s estate, and with converting the mother’s assets.

The chancellor did find undue influence and granted the estate a judgment against Caron. She filed a R59 motion, based on which the court added $100,000 to the judgment, on its own motion, finding that Caron had spent more than $100,000 of estate assets “on more than 40 lawyers” looking for legal opinions to support her position. The court ruled her actions to be a dissipation of estate assets.

Caron appealed, and the MSSC affirmed the chancellor’s ruling on the undue influence and judgment, but reversed on the $100,000 addition for attorney’s fees.

Here’s what Justice Randolph said for the unanimous court in the case of Estate of Crowell: Crowell v. Trotter, handed down November 6, 2014:

¶20. Caron argues that the trial court’s finding that she spent $100,000 of the estate’s money on attorney fees is contrary to the facts in evidence. Caron further argues that ordering her to pay $100,000 increases the value of the estate by $100,000 over the value established by Jackson.

¶21. We find that the trial court erred in sua sponte, post-judgment, increasing the judgment by $100,000 for Caron’s estimated expenditures on attorney fees. The record is inconclusive about both the amount of money spent on attorney fees, and from whose money the funds to pay the legal fees came. The trial court noted that Caron testified that the money came from her own funds, which was the only evidence presented.

¶22. At trial, Caron testified that she had seen at least forty-two lawyers. When asked how much she had spent on legal fees, Caron testified “It’s a lot.” When asked if she had paid for legal fees out of her own money, Caron responded:

A. Well, it depends – as long as Mother was alive, I think I used her funds. I didn’t spend that much really. You know, I was trying to get good legal advice for her and get her totally protected. A lot of the attorneys didn’t charge. But I don’t know how much. I don’t know how much it was. I don’t think it was all that much. Then since her, I have paid my own attorneys fees, and it’s been a lot. I – you know, there’s – it’s been a lot.

Q. Well, give me an estimate.

A. $100,000, I think.

Q. In attorney fees?

A. Yes, that’s a guesstimate, estimate.

¶23. The record does not disclose substantial evidence to support a $100,000 increase in judgment. Caron “guesstimated” the attorney fees to be around $100,000. No testimony of bank statements, canceled checks, bills from attorneys, or any other form of evidence was offered to support or contest Caron’s “guesstimate.”

¶24. If Caron actually spent $100,000 on legal fees, the only testimony before the court was that she paid most of the fees out of her own pocket. The $100,000 “guesstimate” followed her statement that she has paid “a lot” of her “own” legal fees. After Caron testified that she had spent a lot of her own money, counsel asked Caron for an estimate. “$100,000.00, I think” was responsive to a question asking how much of her own money she had spent, which is not substantial evidence to support the trial court’s finding.

* * *

¶26. The record lacks substantial evidence supporting that Caron actually spent $100,000 of the estate’s money. Caron’s ambiguous and unsupported $100,000 “guesstimate” is not substantial evidence. We find such a conclusion is in error.

No surprise here. The reason I am pointing this out is that Caron’s testimony is not too far off what I hear sometimes from witnesses on the issue of attorney’s fees. Vague, indefinite, ballpark figures, unsubstantiated with proof of payment and other supporting evidence, is simply not adequate to prove a claim for attorney’s fees that will stand up on appeal.

Attorney’s Fees in a Modification Case

March 10, 2014 § Leave a comment

As a general proposition, I think most family lawyers would agree that it’s out of the ordinary for there to be an award of attorney’s fees in a modification case absent a companion claim for contempt.

But it’s not unheard of, and it does happen.

Take, for instance, the recent COA decision in Collins v. Collins, handed down February 25, 2014. In that case, the chancellor had awarded Myra Collins $4,234.74 in attorney’s fees after she prevailed in her quest to obtain an upward modification of separate maintenance. Her ex, Arthur, appealed, arguing that it was erroneous for the chancellor to award attorney’s fees in a modification case when there was no allegation of contempt, and there was no finding of her inability to pay.

Judge Griffis addressed the issue for the court:

¶16. In Labella v. Labella, 722 So. 2d 472, 475 (¶12) (Miss. 1998), the supreme court found that one of the parties “clearly established an inability to pay because she was unemployed at the time of trial and her only income was in the form of unemployment benefits.” The court noted that “[t]he general rule is that if a party is financially able to pay his attorney’[s] fees[,] he should do so, though this is a matter which is entrusted to chancellor’s sound discretion.” Id. at (¶13) (quoting Anderson v. Anderson, 692 So. 2d 65, 74 (Miss. 1997)). Also, in Hammett v. Woods, 602 So. 2d 825, 830 (Miss. 1992), the supreme court ruled that “[w]here the record shows an inability to pay and a disparity in the relative financial positions of the parties, we find no error” in awarding attorney fees. Here, the lower court found that “[Myra] has proven that she has an inability to pay and that [Arthur] has the much, much greater ability to pay attorney’s fees, and therefore an award of fees is appropriate in this modification proceeding.”

Does this open the door to an attorney’s fee award in every modification case? Probably not, for a couple of reasons. First, this is a separate maintenance case, and, if you think about it, separate maintenance is in effect an ongoing temporary divorce order. Since its purpose is to provide the wife with as close as possible to her reasonable standard of living without rendering the husband destitute, it stands to reason that her standard of living should not be further reduced by having to pay attorney’s fees to mantain that standard of living. To deny her attorney’s fees wouold defeat the purpose. Second, it has always been the law that, although an award of attorney’s fees is not favored in a modification case, it is appropriate where it would impose an unfair burden on the prevailing party, as where there is a clear inability to pay, or the lack of an award would impoverish children, etc.

This case is not an outlier. Rather, it demonstrates that the chancellor has considerable discretion both as to whether to award a fee, and as to its amount.

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 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.

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