City of Ozark v. Nichols

CITY of OZARK v. James NICHOLS, et al.

CA 96-491                                          ___ S.W.2d ___

                  Court of Appeals of Arkansas
                           Division II
               Opinion delivered February 19, 1997


1.   Statutes -- award of attorney's fees -- not allowed unless
     expressly provided for by statute. -- Attorney's fees are not
     allowed except when expressly provided for by statute.

2.   Statutes -- appellant's argument against retroactive
     application of statute without merit -- no substantive rights
     in issue. -- Appellant's argument that there should be no
     retroactive application of Ark. Code Ann.  18-15-605 (Supp.
     1995) was based upon case law that concerned substantive
     rights; although laws affecting substantive rights operate
     prospectively, there were no substantive rights in issue.

3.   Statutes -- prospective operation -- when applicable. --    
     Whether or not a statute may be retroactively applied turns on
     whether the statute in question is characterized as
     substantive or procedural; the rule by which statutes are
     construed to operate prospectively does not ordinarily apply
     to procedural or remedial legislation; the strict rule of
     construction does not apply to remedial statutes which do not
     disturb vested rights, or create new obligations, but only
     supply a new or more appropriate remedy to enforce an existing
     right or obligation; these should receive a more liberal
     construction, and should be given a retrospective effect
     whenever such seems to have been the intention of the
     legislature. 

4.   Statutes -- allowance of attorney's fees -- changes in
     procedural or remedial law are generally immediately
     applicable. -- The allowance of attorney's fees is a
     procedural matter governed by the laws of the State of
     Arkansas; changes in procedural or remedial law are generally
     to be regarded as immediately applicable to existing causes of
     action and not merely to those which may accrue in the future,
     unless a contrary intent is expressed in the statute.

5.   Statutes -- statute governing damages for eminent domain had
     retroactive application -- trial judge's award of attorney's
     fees affirmed. -- Where the statute governing damages for an
     eminent domain proceeding by a water company was amended to
     mandate attorney's fees in certain situations, and there was
     no question that the facts fit one of those situations,
     thereby triggering the statutory award of a fee, and the
     amendment to Ark. Code Ann.  18-15-605 was procedural in
     nature and so was instantly applicable to existing causes of
     action, the decision of the trial judge in awarding attorney's
     fees to appellees was affirmed.

     Appeal from Franklin Circuit Court; John S. Patterson, Judge;
affirmed.
     Walters, Hamby, & Verkamp, by:  John P. Verkamp, for
appellant.
     Daily, West, Core, Coffman & Canfield, by: Jerry L. Canfield
and Turner & Mainard, by:  James C. Mainard, for appellees.    

     Margaret Meads, Judge.
     The City of Ozark, Arkansas, filed a condemnation complaint
against appellees on June 14, 1993, for the purpose of constructing
and maintaining a water storage tank, water line, and roadway on
land owned by appellees.  Ozark posted a seventy-five hundred
dollar ($7,500.00) bond with the circuit clerkþs office, and the
circuit court entered an order of possession in favor of Ozark on
June 14, 1993.  Ozark filed a second amended complaint on November
30, 1994, to add newly discovered defendants.  Answers were filed
seeking a jury trial for the purpose of determining just
compensation for the condemned property.  A jury trial on the issue
of compensation was held on January 11, 1996, and the jury awarded
appellees $28,500 for their property.  
     The appellees requested attorneyþs fees during the trial and
after the return of the juryþs verdict.  Plaintiff objected to an
award of attorneyþs fees on the basis that they were not authorized
by law at the time the condemnation case was instituted or at the
time the order of possession was entered.  The judgment provided
that þthe said City of Ozark shall pay, in addition to the sum
aforesaid, the sum of $8,634.05 to defendantsþ attorney in
accordance with Ark. Code Ann.  18-15-605.þ  It is from this award
of attorneyþs fees that the City of Ozark appeals.  We find no
error and affirm.
     It is established that attorneyþs fees are not allowed except
when expressly provided for by statute.  Damron v. University
Estates, Phase II, Inc., 295 Ark. 533, 750 S.W.2d 402 (1988)
(citing Harper v. Wheatley Implement Co., 278 Ark. 27, 643 S.W.2d 537 (1982)).  In the case at bar, the statute governing damages for
an eminent domain proceeding by a water company was amended to
mandate attorneyþs fees in certain situations, after entry of the
order of possession but before trial and entry of the judgment. 
     Arkansas Code Annotated  18-15-605 (1987), the statutory
provision in effect when suit was instituted, provided:
     18-15-605.  Damages -- Deposits.
     The further proceedings in the matter of assessment of
     damages and the making of deposits to secure the owner
     shall be the same as is now prescribed by law in
     reference to condemnation proceedings by railroad,
     telegraph, and telephone corporations.
This statute, as revised by Act 1207 of 1995 and made effective
April 11, 1995, now provides: 
     18-15-605.  Damages -- Deposits.
          (a) The further proceedings in the matter of
     assessment of damages and the making of deposits to
     secure the owner shall be the same as is now prescribed
     by law in reference to condemnation proceedings by
     railroad, telegraph, and telephone corporations, except
     that the measure of damages shall be the fair market
     value of the condemned property at the time of the filing
     of the petition by the corporation or water association
     as may be determined by a jury based on the opinion of a
     licensed appraiser.
          (b) In the case of application for orders of
     immediate possession by the corporation or water
     association, if the amount awarded by the jury exceeds
     the amount deposited by the corporation or water
     association in an amount which is more than twenty
     percent (20%) of the sum deposited, the landowner shall
     be entitled to recover the reasonable attorneyþs fees and
     costs.
Ark. Code Ann.  18-15-605 (Supp. 1995).
     There is no question that the juryþs award of $28,500 as
compensation for the land exceeded the $7,500 deposit by more than
twenty percent.  Therefore, if the statute has retroactive
application, appellees are clearly entitled to recover reasonable
attorneyþs fees.  
     Appellant cites Arkansas Rural Med. Prac. Student Loan Bd. v.
Luter, 292 Ark. 259, 729 S.W.2d 402 (1987), in support of its
contention that there should be no retroactive application of the
statute.  However, Luter is distinguishable from the present case,
because the statutory changes involved in that case impeded upon a
substantive, or þvested,þ right for which the student loan board
contracted in promissory notes for loans made to Dr. Luter.  The
supreme court, in reversing the trial courtþs decision to deny the
student loan board relief, held, þThe general rule can be stated
categorically -- laws affecting substantive rights operate
prospectively.þ  Luter, 292 Ark. at 261, 729 S.W.2d  at 403 (1987). 
There are no substantive rights at issue in the case at bar.  
     Both parties cite City of Fayetteville v. Bibb, 30 Ark. App.
31, 781 S.W.2d 493 (1989), for their positions.  The applicable
statute in that case, Ark. Code Ann.  16-22-308 (1987), allowed
reasonable attorneyþs fees to be assessed by the court and
collected as costs.  The trial judge in Bibb declined to award
attorneyþs fees on the basis that the act was not in effect when
the action was commenced.  The court of appeals, upon review, held
that the correct resolution regarding whether or not a statute
could be retroactively applied turned on whether the statute in
question was characterized as þsubstantiveþ or þprocedural.þ  Bibb,
supra.  In Bibb, the court cited Harrison v. Matthews, 235 Ark.
915, 362 S.W.2d 704 (1962):
     The rule by which statutes are construed to operate
     prospectively does not ordinarily apply to procedural or
     remedial legislation.  The strict rule of construction
     contended for does not apply to remedial statutes which
     do not disturb vested rights, or create new obligations,
     but only supply a new or more appropriate remedy to
     enforce an existing right or obligation.  These should
     receive a more liberal construction, and should be given
     a retrospective effect whenever such seems to have been
     the intention of the Legislature. (citations omitted)

30 Ark. App. at 37-38, 781 S.W.2d  at 496 (1989).

     Appellant cites Bibb for the proposition that the best
argument which could be made against the retroactive application of
the attorneyþs fees statute is that the statute þdeals not with the
procedure for enforcing a remedy but rather with the substance of
the remedy itself, i.e. it provides for the award of an attorneyþs
fee where none could be awarded before.þ  Bibb, 30 Ark. App. at 38,
781 S.W.2d  at 496.  However, in the next sentence, this court
explicitly rejected that argument and determined that a statute
which taxed attorneyþs fees as costs was procedural in nature and
that as such it should be given retrospective application.  Bibb,
supra.  This rationale from Bibb was adopted by the Arkansas
Supreme Court in Barnett v. Ark. Trans. Co., Inc., 303 Ark. 491,
798 S.W.2d 79 (1990).     
     Based upon these precedents, the question is whether the
statute (1) is either procedural or remedial in nature or (2)
creates a new obligation.  In USAA Life Ins. Co. v. Boyce, 294 Ark.
575, 745 S.W.2d 136 (1988), the supreme court determined that the
allowance of attorneyþs fees is a procedural matter governed by the
laws of the State of Arkansas.  In Fowler v. McHenry, 22 Ark. App.
196, 737 S.W.2d 663 (1987), this court quoted with approval the
following language from Dargel v. Henderson, 200 F.2d 564 (Emer.
Ct. App. 1952):
     We think that this conclusion is in accord with the
     settled rule that changes in procedural or remedial law
     are generally to be regarded as immediately applicable to
     existing causes of action and not merely to those which
     may accrue in the future unless a contrary intent is
     expressed in the statute.

22 Ark. App. 196, 200, 737 S.W.2d 663, 665 (1987).
     We find that the amendment to Ark. Code Ann.  18-15-605 was
procedural in nature and was instantly applicable to existing
causes of action.  We affirm the decision of the trial judge in
awarding attorneyþs fees to appellees.
     Affirmed.
     Cooper and Stroud, JJ., agree.