FINNELL v. JEBCO SEISMIC

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FINNELL v. JEBCO SEISMIC
2003 OK 35
67 P.3d 339
Case Number: 97342
Decided: 04/01/2003

THE SUPREME COURT OF THE STATE OF OKLAHOMA

BILL FINNELL and SANDRA FINNELL, Plaintiffs/Appellees,
v.
JEBCO SEISMIC and JEBCO SEISMIC L.P., Defendants/Appellants,
and
PGS ONSHORE, INC., Third-Party Defendant/Appellant.

ON CERTIORARI TO THE COURT OF CIVIL APPEALS, DIVISION II

¶0 Plaintiffs brought this action against Jebco Seismic and Jebco Seismic L.P. in the District Court, Beckham County, Doug Haught, trial judge, to recover monetary damages for injury to real property. Defendants filed a third-party petition against PGS Onshore, Inc., alleging that the third-party defendant was liable for any damages suffered by plaintiffs. Defendants and the third-party defendant admitted liability prior to trial and the issue of damages alone was tried to a jury. The jury returned a verdict for plaintiffs in the amount of $26,000.00. Plaintiffs then moved to recover their attorney's fee and costs. The trial court granted a fee in the amount of $17,005.00. Defendants appealed from that order. The Court of Civil Appeals, Division II, reversed. Upon plaintiffs' petition for certiorari,

THE COURT OF CIVIL APPEALS' OPINION IS VACATED; THE TRIAL COURT'S COUNSEL-FEE AWARD IS AFFIRMED; UPON REMAND THE TRIAL COURT IS AUTHORIZED TO DETERMINE THE AMOUNT OF PLAINTIFFS' REASONABLE APPEAL- AND CERTIORARI- RELATED ATTORNEY'S FEE.

Jack W. Ivester and Thomas S. Ivester, IVESTER, IVESTER & IVESTER, Sayre, Oklahoma, for Appellees.
Mitchell A. Hallren, Fairview, Oklahoma, for Appellants.

OPALA, V.C.J.

¶1 The dispositive issues tendered on certiorari are (1) do the terms of 12 O. S. 2001, §940 entitle plaintiffs/appellees to a counsel-fee award? and if so, (2) is the fee that was awarded reasonable? We answer both questions in the affirmative.

I
ANATOMY OF LITIGATION

¶2 Jebco Seismic, Inc. (Jebco) entered into an agreement in late 1997 or early 1998 with Bill Finnell (Finnell) which granted permission to Jebco and/or its assigns to conduct a 3-D seismic survey on Finnell's property.

¶3 The survey was conducted (at least in part) by Jebco's assignee, PGS Onshore, Inc. (PGS). When Finnell discovered that the survey had caused injury to his property beyond that covered by the agreed compensation, he demanded that Jebco pay for the damages. Jebco refused. Finnell then brought suit against Jebco in the District Court, Beckham County, seeking monetary damages in the amount of $74,000.00.

¶4 Before Jebco filed its answer, the parties stipulated to an amendment to the petition to add Jebco Seismic L.P. as a defendant (Jebco and Jebco Seismic L.P. will together be referred to as Jebco). Jebco denied Finnell's claim and filed a third-party petition against PGS,

¶5 Prior to trial Jebco and PGS admitted liability,

¶6 Plaintiffs timely applied for an attorney's fee award pursuant to the provisions of 12 O.S. 2001, §940 (§940).

II
STANDARD OF REVIEW

¶7 Two issues are presented on certiorari. The first is whether plaintiffs' claim entitles them to an attorney's fee award under the provisions of §940. This issue presents a question of law which we review de novo. The court has plenary, independent, and non-deferential authority to reexamine a trial court's legal rulings.

¶8 The second issue, which need be decided only if plaintiffs are entitled to the statutory award in the first instance, is whether the fee awarded is reasonable. The amount to be awarded as a fee for the services of a legal practitioner is a matter left to the discretion of the trial court and will not be disturbed absent an abuse of discretion.

III
PLAINTIFFS ARE ENTITLED TO A COUNSEL-FEE
AWARD UNDER THE PROVISIONS OF

¶9 The provisions of §940 state in pertinent part:

"A. In any civil action to recover damages for the negligent or willful injury to property and any other incidental costs related to such action, the prevailing party shall be allowed reasonable attorney's fees, court costs and interest to be set by the court and to be taxed and collected as other costs of the action." (emphasis added)

¶10 As the prevailing party in this action, plaintiffs applied for an attorney's fee award in reliance on this section, characterizing their claim to be for a money judgment for the physical injury to property.

¶11 This court remains committed to the American Rule in assessing litigation expenses against a vanquished opponent.

¶12 With the adoption of the Oklahoma Pleading Code in 1984, Oklahoma became a notice pleading state.

¶13 Oklahoma law has long recognized that an action for breach of contract and an action in tort may arise from the same set of facts.

¶14 Defendants also point to the jury instructions in support of their argument that the case was tried as a breach of contract action only, but we see nothing in the trial court's instructions to the jury that calls for this conclusion. The jury instructions indicate that the defendants at some point prior to trial admitted liability for the damage to plaintiffs' property.

¶15 Statutes in derogation of the common law are to be liberally construed so as to effect legislative intent.

IV
THE ATTORNEY'S FEE AWARDED TO PLAINTIFFS IS REASONABLE

¶16 We now turn to review the question of the reasonableness of the attorney's fee awarded by the trial court.

¶17 An attorney's fee must in every instance be reasonable.

¶18 The record shows that the trial court followed these guidelines in assessing the amount of the award. The baseline amount was arrived at from the detailed time records submitted with the application by multiplying the hours expended by an hourly rate just under $100.00 per hour. A hearing was conducted at which two experienced local practitioners familiar with civil litigation testified that the minimum hourly rate in the local legal community is $100.00 per hour. Each also testified that he had reviewed the time records submitted with the fee application and had concluded that the hours expended were reasonable. Defendants called a third local attorney to testify, who opined that an hourly rate of $90.00 per hour would be more reasonable given the experience level of plaintiffs' primary attorney. He also testified that an experienced attorney would probably have spent only one hundred hours, rather than one-hundred sixty nine hours, on the case. The trial judge accepted the testimony of the two attorneys who found the baseline amount to be reasonable and awarded a fee in that amount with a relatively negligible enhancement of $350.00.

¶19 Defendants contend that an award which amounts to sixty-five percent (65%) of the amount recovered is excessive on its face. We disagree. While we are committed to the rule that a fee for legal services must bear some reasonable relationship to the judgment,

¶20 Defendants urge us to consider the fact that there is a contingency fee arrangement extant between plaintiffs and their attorneys under which plaintiffs' attorneys are entitled to fifty percent (50%) of the award on appeal. Defendants contend that plaintiffs' attorneys will garner a windfall by collecting both the contingency fee ($13,000.00) and the statutory fee ($17,005.00). Our pronouncement in State ex rel. Oklahoma Bar Association v. Weeks,

¶21 We hold that the trial court's counsel-fee award to plaintiffs of $17,005.00 rests on competent evidence. The reasonableness of an attorneys' fee request is a question of fact for the trier. The trial court is in a far better position to judge the demands of the case than are we. Upon the record submitted, we cannot say that the award is clearly erroneous or that it is unsupported by reason and evidence.

¶22 Plaintiffs have timely applied to this court for an appeal-related attorney's fee. An appeal-related counsel fee may be awarded in cases where there is statutory authority to award a fee for legal services rendered in the trial of a cause.

V
SUMMARY

¶23 The two issues presented for certiorari review are resolved in a manner to be stated: We hold that plaintiffs pressed a claim "to recover for damages for the negligent or willful injury to property" within the meaning of §940 and are hence entitled to an attorney's fee under that statute. We also hold that the amount of the fee awarded was arrived at by a process consistent with the pronouncements of this court and that the amount awarded does not exhibit an abuse of the discretion given the trial court to set a fee award.

¶24 THE COURT OF CIVIL APPEALS' OPINION IS VACATED; THE TRIAL COURT'S COUNSEL-FEE AWARD IS AFFIRMED; UPON REMAND THE TRIAL COURT IS AUTHORIZED TO DETERMINE THE AMOUNT OF PLAINTIFFS' REASONABLE APPEAL- AND CERTIORARI- RELATED ATTORNEY'S FEE.

¶25 WATT, C.J., OPALA, V.C.J., HODGES, LAVENDER, KAUGER and WINCHESTER, JJ. CONCUR.

¶26 SUMMERS, J., CONCURS IN PARTS I and II, CONCURS IN RESULT IN PART III and DISSENTS FROM PART IV.

¶27 BOUDREAU, J., CONCURS IN RESULT.

¶28 HARGRAVE, J., DISSENTS.

FOOTNOTES

1Although the letter-agreement was addressed to both Finnell and his wife, Sandra, only Finnell's signature appears on the instrument.

2The procedure governing third-party petitions is set forth in 12 O.S. 2001, §2014.

3Because this is an appeal from the post-judgment attorney's fee award, the appellate record omits all trial-related paperwork between the initial pleadings and the instructions to the jury. It is by the jury instructions that we are informed that defendants as well as the third-party defendant admitted liability.

4For the provisions of §940, see the opening text of Part III.

5Plaintiffs also sought and obtained their costs in the amount of $1,481.66. Defendants' appeal does not challenge the costs award.

6Kluver v. Weatherford Hosp. Auth., 1993 OK 85, ¶14, 859 P.2d 1081, 1083 ("[i]ssues of law are reviewable by a de novo standard and an appellate court claims for itself plenary independent and non-deferential authority to reexamine a trial court's legal rulings"); Salve Regina College v. Russell, 499 U.S. 225, 231, 111 S. Ct. 1217, 1221, 113 L. Ed. 2d 190 (1991).

7CNA Ins. Co. v. Krueger, Inc., of Tulsa, 1997 OK 142, ¶19, 949 P.2d 676, 680; Green Bay Packaging, Inc. v. Preferred Packaging, Inc., 1996 OK 121, ¶32, 932 P.2d 1091, 1097; Southwestern Bell Telephone Co. v. Parker Pest Control, Inc., 1987 OK 16, ¶18, 737 P.2d 1186, 1189; State ex rel. Burk v. City of Okla. City, 1979 OK 115, ¶22, 598 P.2d 659, 663.

8Green Bay Packaging, Inc., supra note 7 at ¶32, at 1097; Broadwater v. Courtney, 1991 OK 39, ¶7, 809 P.2d 1310, 1312.

9In Woods Petroleum Corp. v. Delhi Gas Pipeline Corp., 1984 OK 94, 700 P.2d 1011, we held that an attorney's fee is recoverable under §940 only in those actions for damages for negligent or willful physical injury to property. Id. at ¶13, at 1013.

10The relevant allegations of plaintiffs' petition are as follows:
"2. On or about February 3, 1998, the Plaintiff entered into a written contract with the Jebco Seismic L.P. The contract was to be performed in Beckham County, Oklahoma. PGS Onshore, Inc. substantially performed the geophysical activity stated in the contract. The contract is attached as Exhibit "A" and made a part hereof. Plaintiff has incurred damages in the amount of $74,000 resulting from the contract.
3. That demand has been made upon the Defendants for payment of damages resulting from work done under the contract and payment has not been received."

11See Morgan v. Galilean Health Enterprises, Inc., 1998 OK 130, ¶11, 977 P.2d 357, 362-63; Barnes v. Okla. Farm Bur. Mutual Ins. Co., 2000 OK 55, ¶46, 11 P.3d 162, 178-79; Moses v. Hoebel, 1982 OK 26, ¶5, 646 P.2d 601, 603.

12State ex rel. Tal v. City of Okla. City, 2002 OK 97, ¶26, 61 P.3d 234, 247.

13Morgan, supra note 11 at ¶11, at 362; TRW/Reda Pump v. Brewington, 1992 OK 31, ¶13, 829 P.2d 15, 22.

14See the provisions of 12 O.S. 2001, §2001 et seq.

15Delbrel v. Doenges Bros. Ford, Inc., 1996 OK 36, ¶3, 913 P.2d 1318, 1320.

16Title 12 O.S.1991 2008(A) provides in pertinent part:
"A. CLAIMS FOR RELIEF. A pleading which sets forth a claim for relief, whether an original claim, counterclaim, cross-claim or third-party claim, shall contain:
1. A short and plain statement of the claim showing that the pleader is entitled to relief; and
2. A demand for judgment for the relief to which he deems himself entitled.. . . ."

17Niemeyer v. United States Fidelity and Guaranty Co., 1990 OK 32, ¶5, 789 P.2d 1318, 1321.

18Silver v. Slusher, 1988 OK 53, ¶5, n. 7, 770 P.2d 878, 881 n. 7, cert. denied, Silver v. Farmers and Merchants Ins. Co., 493 U.S. 817, 110 S. Ct. 70, 107 L. Ed. 2d 37 (1989); Doss Oil Royalty Co. v. Texas Co., 1943 OK 154, ¶21, 137 P.2d 934, 939 (decided under the Code of Civil Procedure, 12 O.S. 1981, §1 et seq.).

19Although the Code of Civil Procedure, which governed Oklahoma pleading before its repeal in 1984, was designed to eliminate some of the extreme technicalities of common-law procedure, a pleader was still required to elect between inconsistent remedies. With the enactment of the federal notice pleading regime, the doctrine of mandatory election of remedies before submission became an anachronism. See the provisions of 12 O.S. 2001, §2008(E)(2); Howell v. James, 1991 OK 47, ¶14, 818 P.2d 444, 446-48.

20Bradley Chevrolet, Inc. v. Goodson, 1969 OK 25, ¶¶7-9, 450 P.2d 500, 502; Vogel v. Rushing, 1949 OK 275, ¶12, 212 P.2d 665, 667.

21Doss, supra, note 18 at ¶21, at 939 ("[w]hen a plaintiff states and proves the facts, he is not required to designate the theory upon which relief may be granted. He is entitled to any relief which the facts may justify.... This is the very heart of the code. To require him to correctly name his theory would be a step backward toward the old practice of pleading forms of action, the very thing the code was designed to abolish.").

22Leak-Gilbert v. Fahle, 2002 OK 66, ¶20, 55 P.3d 1054, 1059; Great Plains Federal Savings & Loan Association v. Dabney, 1993 OK 4, ¶7, 846 P.2d 1088, 1092; Flint Ridge Dev. v. Benham-Blair & Affiliates, 1989 OK 48, ¶7, 775 P.2d 797, 799.

23Morriss v. Barton, 1947 OK 260, ¶41, 190 P.2d 451, 457; Independent Torpedo Co. v. Carder, 1933 OK 477, 25 P.2d 62, 64; Jackson v. Central Torpedo Co., 1926 OK 434, ¶8, 246 P. 426, 428 ("If the transaction complained of had its origin in a contract which placed the parties in such a relation that, in attempting to perform the promised service, the tort was committed, then the breach of the contract is not the gravamen of the suit. The contract in such case is mere inducement, creating the state of things which furnishes the occasion of the tort, and in all such cases the remedy is an action on the case.").

24Panama Processes, S.A. v Cities Service Co., 1990 OK 66, ¶34, n. 58, 796 P.2d 276, 290, n. 58; Lewis v. Farmers Ins. Co., Inc., 1983 OK 100, ¶5, 681 P.2d 67, 69; Keel v. Titan Constr. Corp., 1981 OK 148, ¶14, 639 P.2d 1228, 1232.

25Great Plains Federal Savings and Loan Ass'n v. Dabney, 1993 OK 4, ¶2, 846 P.2d 1088, 1095, (Opala, J. with whom Kauger, J. joins, concurring); Howell v. James, supra note 19 at ¶11, at 447.

26We note that the addition of Mrs. Finnell as a party plaintiff supports a tort theory of recovery inasmuch as she was not a signatory to the contract.

27Instruction No. 4 states in part:
"Jebco Seismic and PGS Onshore, Inc. have admitted responsibility for any injury Bill and Sandra Finnell sustained as a result of the seismic survey."

28Instruction No. 4 states in part:
"The issues in this case to be determined by you are: What injury Plaintiffs Bill and Sandra Finnell sustained as a direct result of this occurrence and what damages they should recover to compensate them for this injury."

29The measure of a promise-based obligation's breach is the amount which will compensate the injured party for all the detriment proximately caused by the breach. The provisions of 23 O.S. 2001, §21, governing contract damages, state;
"For the breach of an obligation arising from contract, the measure of damages, except where otherwise expressly provided by this chapter, is the amount which will compensate the party aggrieved for all the detriment proximately caused thereby, or which, in the ordinary course of things, would be likely to result therefrom. No damages can be recovered for a breach of contract, which are not clearly ascertainable in both their nature and origin."

Tort reparations include compensation for all proximately caused harm, whether foreseeable or not. The terms of 23 O.S. 2001, §61, governing non-contract damages, state:
"For the breach of an obligation not arising from contract, the measure of damages, except where otherwise expressly provided by this chapter, is the amount which will compensate for all detriment proximately caused thereby, whether it could have been anticipated or not."

30Instruction No. 5 states:
"The amount of damages recoverable by the Plaintiffs for land damage is limited to reasonable cost of repair or the reduction in value of land whichever is less. Reasonable cost of repair includes loss of crops and cost of restoring land to production. The reduction in the value of land is the difference between the actual value immediately before and immediately after the damage is sustained."

31The terms of 25 O.S. 2001, §29 state:
"The rule of the common law, that statutes in derogation thereof are to be strictly construed, has no application to the laws of this state, which are to be liberally construed with a view to effect their objects and to promote justice."

32Because liability was not an issue in the case, it was not necessary for plaintiffs to offer proof of defendants' tortious conduct. Hence, there was no jury determination of the precise nature of defendants' conduct, i.e. where it fits on the tort continuum.

33Schaeffer v. Shaeffer, 1987 OK 30, ¶9, 743 P.2d 1038, 1040.

34The Court of Civil Appeals' opinion did not address this issue. Our pronouncement in Hough v. Leonard, 1993 OK 112, 867 P.2d 438, teaches that the prevailing party in the Court of Civil Appeals may obtain this court's review of issues properly raised and briefed on appeal, but not addressed by the intermediate appellate court, without filing a petition for certiorari. Id. at ¶18, at 446; Rule 1.180, Oklahoma Supreme Court Rules, 12 O.S.2001, Ch. 15, App. 1.

35Rule 1.5, Rules of Professional Conduct, 5 O.S. 2001, Ch. 1, App. 3-A. The federal court approach to this question is also based on the reasonableness of the value placed on the necessary legal services. Robinson v. City of Edmond, 160 F.3d 1275 (10th Cir.1998).

361979 OK 115, ¶8, 598 P.2d 659, 661. The criteria set forth in Burk are: time and labor required; novelty and difficulty of the questions; skill requisite to perform the legal service properly; preclusion of other employment by the attorney due to acceptance of the case; customary fee; whether the fee is fixed or contingent; time limitations imposed by the client or circumstances; amount involved and the results obtained; experience, reputation and ability of the attorneys; "undesirability" of the case (i.e., risk of non-recovery); nature and length of professional relationship with the client; and awards in similar cases. See also Morgan v. Galilean Health Services, Inc., supra note 11 at ¶12, at 364 (holding that the amount owed under a contingency-fee contract may not serve as the basis for assessment of the value of legal services due the prevailing party against its vanquished opponent); but see Okla. Turnpike Auth. v. New Life Pentecostal Church of Jenks, 1994 OK 9, ¶11, 870 P.2d 762, 765 (holding that in a condemnation proceeding the quantum of a counsel-fee award against the condemnor "is measured by the extent of the landowner's obligation to its lawyer unless, of course, the obligation is excessive.").

37Oliver's Sports Center, Inc. v. National Standard Ins. Co., 1980 OK 120, ¶8, 615 P.2d 291, 295; Green Bay Packaging Inc., supra note 7 at ¶48, at 1099-1100.

38The terms of Rule 1.5 of the Rules of Professional Conduct, 5 O.S. 2001, Ch.1, App. 3-A, provide in pertinent part:
"(a) A lawyer's fee shall be reasonable. The factors to be considered in determining the reasonableness of a fee include the following:
(1) the time and labor required, the novelty and difficulty of the questions involved, and the skill requisite to perform the legal service properly;
(2) the likelihood, if apparent to the client, that the acceptance of the particular employment will preclude other employment by the lawyer;
(3) the fee customarily charged in the locality for similar services;
(4) the amount involved and the results obtained;
(5) the time limitations imposed by the client or the circumstances;
(6) the nature and length of the professional relationship with the client;
(7) the experience, reputation, and ability of the lawyer or lawyers performing the services; and
(8) whether the fee is fixed or contingent."

In Burk, supra, note 36, we held that along with the standards set forth by the Oklahoma Rules of Professional Responsibility, trial courts in this state may apply the standards utilized by the federal courts. See Johnson v. Georgia Highway Express, Inc., 488 F.2d 714 (5th Cir.1974). The federal standards are substantially similar to those contained in Rule 1.5 and an exhaustive application of either list will almost always lead to a just and reasonable result. See also Robert L. Wheeler, Inc. v. Scott, 1989 OK 106, 777 P.2d 394; Robert L. Wheeler, Inc. v. Scott, 1991 OK 95, 818 P.2d 475.

39Southwestern Bell Telephone Co. v. Parker Pest Control, Inc., 1987 OK 16, ¶17, 737 P.2d 1186, 1189; Arkoma Gas Company v. Otis Engineering Corp., 1993 OK 27, ¶6, 849 P.2d 392, 395.

40Inasmuch as the record is silent on the reason for the enhancement, we assume that the $350.00 awarded to plaintiffs beyond that which they sought by their fee application represents an addition based on unarticulated Burk factors. Because defendants did not assail the addition as unauthorized, its allowance is not in contest.

41See id. for citations establishing this rule.

42Supra note 39.

43Id. at ¶21, at 1190.

44Supra note 39.

45Id. at ¶8, at 394.

461981 OK 13, 626 P.2d 857.

47Id. at ¶21, at 861. See also Williams & Kelley Architects v. Independent School District No. 1, Okmulgee County, 1994 OK CIV APP 113, ¶14, 885 P.2d 691, 695 (approving a $25,000 fee on a quantum meruit confessed judgment of $25,100 where recovery sought was $164,000.00).

481998 OK 83, 969 P.2d 347, cert. denied, Weeks v. Okla. Bar Ass'n, 525 U.S. 1042, 119 S. Ct. 593, 142 L. Ed. 2d 535 (1998).

49Sisney v. Smalley, 1984 OK 70, ¶20, 690 P.2d 1048,1051 ("Whenever there is statutory authority to award attorney fees in the trial of a matter, additional fees may be allowed (to the prevailing party) for legal services rendered in the appellate court."). See also Rule 1.14(b), Oklahoma Supreme Court Rules, 12 O.S. 2001, Ch. 15, App. 1.