DEPOSIT BANK OF MONROE COUNTY v. JAMES L. POLAND; VIRGINIA C. POLAND; AMERICAN GENERAL HOME EQUITY, INC. AND EDDIE PROFFITT (D/B/A PROFFITT REAL ESTATE AGENCY)
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RENDERED: MARCH 10, 2000; 2:00 p.m.
NOT TO BE PUBLISHED
C ommonwealth O f K entucky
C ourt O f A ppeals
NO.
1997-CA-002848-MR
DEPOSIT BANK OF MONROE COUNTY
APPELLANT
APPEAL FROM MONROE CIRCUIT COURT
HONORABLE PAUL JONES, JUDGE
ACTION NO. 97-CI-00022
v.
JAMES L. POLAND; VIRGINIA C. POLAND;
AMERICAN GENERAL HOME EQUITY, INC.
AND EDDIE PROFFITT (D/B/A PROFFITT
REAL ESTATE AGENCY)
and
NO.
1997-CA-002939-MR
JAMES L. POLAND
v.
APPELLEES
CROSS-APPELLANT
CROSS APPEAL FROM MONROE CIRCUIT COURT
HON. PAUL JONES, JUDGE
CIVIL ACTION NO. 97-CI-00022
DEPOSIT BANK OF MONROE COUNTY
CROSS-APPELLEE
OPINION AND ORDER
DISMISSING
** ** ** ** **
BEFORE: GUDGEL, CHIEF JUDGE; BARBER, AND McANULTY, JUDGES.
BARBER, JUDGE:
On June 19, 1997, Appellant, the Deposit Bank of
Monroe County, (“the Bank”) filed a Complaint against the
Appellees, James L. Poland and Virginia C. Poland, (“Polands”) in
the Monroe Circuit Court.
The Bank alleged that the Polands were
in default on a note secured by a real estate mortgage.
The Bank
sought judgment in the amount of $49,686.12 and judicial sale of
the real property to satisfy the debt.
An Agreed Judgment and Order of Sale was entered August
5, 1997.
The parties agreed that the real estate would be sold
at absolute auction sale, with reserve.
Judgment was granted for
the Plaintiff Bank against the Polands in the amount of
$51,135.05, as of July 30, 1997 together with accrued interest
thereon from July 30, 1997...” and awarding the Plaintiff Bank
“its reasonable attorney’s fees as incurred and allowable by law,
and court costs.”
The Agreed Judgment and order of sale further
provided that the Bank would have a first lien on the real
property to secure the payment of “said judgment including
reasonable attorney’s fees, as permitted by KRS 411.195...”
KRS 411.195 is entitled, “Enforceability of written
agreement to pay attorney fees in event of default.”
provides:
The statute
Any provisions in a writing which create a
debt, or create a lien on real property,
requiring the debtor, obligor, lienor or
mortgagor to pay reasonable attorney fees
incurred by the creditor, obligee or
lienholder in the event of default, shall be
enforceable, provided, however, such fees
shall only be allowed to the extent actually
paid or agreed to be paid, and shall not be
allowed to a salaried employee of such
creditor, obligor or lienholder.
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On September 18, 1997, the Bank filed a motion to
disburse the funds (sale proceeds) held by Proffitt Real Estate
Agency to the “Deposit Bank of Monroe County as of 9/24/97 the
sum of $59,894.15, which consists of the Judgment amount,
interest, court costs and attorney’s fees.”
On September 26, 1997, the Bank’s counsel, Hon. Reed N.
Moore, filed an affidavit that he had received a check drawn on
Proffitt Real Estate Agency’s escrow account of $51,860.25; that
the net to the Bank, after deduction of attorney’s fees was
$44,081.21.
Attached to the Affidavit were copies of that check
and of two checks drawn on Mr. Moore’s escrow account - one in
the amount of $44,081.21 payable to the order of the Deposit Bank
of Monroe County and the other in the amount of $7,779.04 payable
to the order of Reed N. Moore, Jr.
The Affidavit of counsel stated that, “As is obvious,
the attorney’s fee has been incurred pursuant to the contingency
fee agreement.
It is the same contingency fee agreement between
Reed N. Moore, Jr. and the Deposit Bank of Monroe County that has
been in effect since 1991.”
was filed.
No written contingency fee agreement
The Bank filed a document entitled, “Partial
Settlement,” signed by its president, Charlie Kirkpatrick,
reflecting “additional income and expenses in the above-styled
action,” consisting of a payoff of principal and interest in the
amount of $51,860.25, and a 15% attorney fee in the amount of
$7,779.04.
On October 7, 1997, James L. Poland, filed a motion
requesting that the circuit court strike the affidavit/partial
-3-
settlement contending that he did not have an opportunity to
cross-examine the affidavits; that they contained hearsay; that
he was entitled to an opportunity to offer contrary proof; and
that an affidavit containing an itemization of time expended
should be required from the Bank’s attorney to support a
reasonable attorney fee based upon an hourly rate.
Poland also
requested that he be granted 60 days discovery and that an
evidentiary hearing be scheduled.
By Order entered on October 8, 1997, the Monroe Circuit
Court ordered that “the Debtor shall pay the Plaintiff’s
attorney, Reed N. Moore, Jr., $3,106.00 as a reasonable
attorney’s fee to be paid by the Debtor.”
On November 7, 1997, the Bank filed a Notice of Appeal
“from the final judgment entered by the circuit court in this
matter on October 8, 1997.”
The Bank’s Notice of Appeal does not
name attorney, Reed N. Moore, Jr., as a party.
On November 14, 1997, James L. Poland filed a Notice of
Cross-Appeal from the “order entered by the Monroe Circuit Court
on October 8, 1997.”
Poland’s Notice of Cross-Appeal does not
name the attorney, Reed N. Moore, Jr., as a party.
On appeal, the Bank argues that “attorney’s fees are
enforceable as actually incurred as long as they are not
determined to be unreasonable.”
The Bank seeks an increased fee
pursuant to “the contingency fee contract” and “the Affidavits of
the two bank presidents of the three banks in the County.”
The Bank provides no citation to the record, as
required by CR 76.12(4)(c)(iii).
-4-
The Bank refers to the statute,
KRS 411.195, as the “Law,” but fails, as required under CR
76.12(4)(c)(iv), to support its argument with any legal authority
that the circuit court erred in determining the amount of a
reasonable attorney fee.
The Bank refers to and includes, as
exhibits to its brief, two affidavits which do not appear to be
in the record on appeal.
Additionally, the appeal is fatally defective, as is
the cross-appeal, because the attorney was not named as a party
to the appeal.
Here, the judgment appealed and cross-appealed
from states, in pertinent part:
IT IS HEREBY ORDERED, ADJUDGED AND DECREED
THAT the Debtor shall pay the Plaintiff’s
attorney, Reed N. Moore, J., $3,106.00 as a
reasonable attorney’s fee to be paid by the
Debtor. This is a final and appealable
order.
The award of attorney fees was made directly to the
attorney.
Under this circumstance, the attorney is a necessary
party to an appeal contesting the award.
Knott v. Crown Colony
Farm, Inc., Ky. 865 S.W.2d 326, 331 (1993).
Accordingly, both
the appeal and cross appeal be and hereby are dismissed for
failure to name the Plaintiff’s attorney as a necessary party.
ALL CONCUR.
David A. Barber
JUDGE, COURT OF APPEALS
ENTERED: March 10, 2000
BRIEF FOR APPELLANT/CROSS
APPELLEE:
BRIEF FOR APPELLEES/CROSS
APPELLANTS:
Hon. Reed N. Moore, Jr.
Tompkinsville, Kentucky
Hon. Joe Lane Travis
Glasgow, Kentucky
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