1. Costs--attorney fees--reasonable value of services
The trial court did not abuse its discretion in a negligence action arising out of an
automobile accident by awarding attorney fees to plaintiff under N.C.G.S. § 6-21.1, because the
trial court made adequate findings of fact to support its conclusion that the reasonable value of
services rendered by plaintiff's attorney was $4,880.00.
2. Costs--attorney fees--offer of judgment--judgment finally obtaine
d
The trial court did not err in a negligence action arising out of an automobile accident by
awarding plaintiff costs and attorney fees under N.C.G.S. § 6-21.1 and N.C.G.S. § 1A-1, Rule 68
based on the conclusion that the judgment finally obtained exceeded the offer of judgment of
$4,801.00, because: (1) the judgment finally obtained includes the jury's verdict, along with any
applicable adjustments including pre-offer costs and costs incurred after the offer the judgment
but prior to the entry of judgment by the trial court; and (2) plaintiff was awarded $1,134.30 in
costs plus $4,880.00 in attorney fees in addition to the $4,500.00 awarded by the jury verdict,
bringing the total for the judgment finally obtained to $10,514.30.
Jones, Martin, Parris and Tessener, L.L.P., by Sean A.B. Cole,
for plaintiff appellee.
Smith Law Offices, P.C., by Christopher N. Heiskell, for
defendant appellant.
McCULLOUGH, Judge.
During the early morning hours of 23 May 1999, a northbound
1990 Cadillac driven by Clyde Riddick (defendant) collided with an
eastbound 1993 Plymouth operated by Reginald Thorpe (plaintiff) at
a rural intersection in Johnston County, North Carolina. Following
the accident plaintiff sought medical treatment for soft-tissue
injuries he suffered as a result of defendant's negligence. After eleven days of correspondence with defendant's ins
urance
carrier, Allstate, plaintiff filed a complaint in the District
Court Division of Wake County on 28 June 1999. In his complaint,
plaintiff claimed defendant negligently operated his vehicle by
failing to stop at the intersection and defendant's negligence
proximately caused the accident which led to plaintiff's injuries,
pain and suffering, lost wages, and medical expenses. Defendant
answered with a defense of contributory negligence and plaintiff
invoked the doctrine of last clear chance. Defendant supplemented
his answer with a request that plaintiff provide a written
statement of the amount of monetary relief sought. Plaintiff
responded that a specific dollar amount of relief sought could not
yet be determined. Plaintiff agreed to amend his response as soon
as practical, but warned defendant the amount of relief sought
could change depending on plaintiff's medical bills, lost wages,
pain and suffering, and the permanency of his injuries.
On 1 December 1999, after the parties completed written
discovery, defendant submitted an offer to settle in the amount of
$4,800.00 to plaintiff's attorney. Plaintiff rejected that offer
and made a counteroffer of $7,000.00 which was rejected by
defendant. On 2 December 1999 defendant served plaintiff with a
lump sum offer of judgment in the amount of $4,801.00, which
plaintiff subsequently rejected.
Clyde Riddick died while the action was pending, and Eloise
Perry-Riddick, his wife, was substituted as defendant in her
capacity as administratrix of his estate. During the final
pretrial conference, both parties contended the single contestedissue to be tried by the jury regarded plaintiff's damages and told
the court there had been full and frank discussion of settlement
possibilities. Defendant never withdrew the defense of
contributory negligence, but stipulated to liability at trial. On
22 August 2000, the jury returned a verdict for plaintiff in the
amount of $4,500.00. Following entry of the jury verdict, counsel
for plaintiff moved for attorney fees to compensate for 63 hours of
time in rendering legal services to plaintiff at a rate of $122.00
per hour pursuant to N.C. Gen. Stat. § 6-21.1, and for costs
totaling $1,207.95 pursuant to N.C. Gen. Stat. § 7A-305. In its
order awarding attorney fees and costs, the trial court made the
following findings of fact:
1. This is a persona
l injury action arising
out of an automobile collision on May 23,
1999. The Complaint was filed by the
Plaintiff on June 28, 1999.
2. On December 2, 19
99, Defendant filed a
Lump Sum Offer of Judgment of Four
Thousand Eight Hundred One and No/100
Dollars ($4801.00) which included "all
damages, attorney's fees taxable as
costs, interest and the remaining costs
accrued at the time" the offer was
served.
3. On August 22, 200
0, a jury returned a
verdict for the Plaintiff in the amount
of Four Thousand Five Hundred and No/100
Dollars ($4,500.00).
4. The judgment fin
ally obtained exceeded
Defendant's Offer of Judgment.
5. Costs to which Pl
aintiff is entitled to
recover, exclusive of attorney fees under
N.C.G.S. § 6-21.1, total $4,880.00.
6. Plaintiff Regina
ld Thorpe's recovery is
less than $10,000, and the Court, in its
discretion, finds that a reasonable
attorney fee should be allowed and taxedas part of court costs.
7. Plaintiff Regina
ld Thorpe was represented
by R.L. Pressley, attorney at law. Mr.
Pressley provided legal services to the
Plaintiff which consisted of drafting,
filing, and handling pleadings; taking
and defending depositions, conducting
discovery; conferring with opposing
counsel, the Judge, and the Clerk of
Court; preparing for and attending trial
and post trial motions. As counsel for
Plaintiff Reginald Thorpe, Mr. Pressley
expended at least 63 hours of time in
rendering legal services to the
Plaintiff. The customary charge for
attorneys in this area with his level of
experience is $122.00 dollars per hour.
8. The Court, in it
s discretion, and upon
considering the Washington v. Horton, 132
N.C. App. 347, 513 S.E.2d 331 factors,
awards attorney's fees totaling $4,880.00
to Plaintiff Reginald Thorpe.
The trial court made the following conclusions of law:
1. Based on the fo
regoing Finding of Fact,
the Court concludes, as a matter of law
and in its discretion, that the
reasonable value of services rendered by
the Plaintiff's attorney in this matter
was $4,880.00 and that those attorney
fees should be taxed as costs to the
Defendant pursuant to N.C.G.S. § 6-21.1.
2. Plaintiff is als
o entitled to costs of
$1,134.30 in the Court's discretion
and/or pursuant to N.C.G.S. § 7A-305.
Based on these findings of fact and conclusions of law, on 14
September 2000, the trial court entered an order awarding plaintiff
attorney fees in the amount of $4,880.00 and costs in the amount of
$1,134.30, in addition to the $4,500.00 jury verdict, as a matter
of law. Defendant appealed.
Defendant makes seven assignments of error challenging the
trial court's findings of fact and conclusions of law. Allassignments of error are connected to a single dispositive issue;
whether the trial court made sufficient findings of fact from the
evidence and the entire record of the case to support its award of
attorney fees and costs to plaintiff. For the reasons set forth,
we hold the trial court properly awarded attorney fees and costs.
[1]/A HREF>Defendant first argues the trial court abused its
discretion by failing to make sufficient findings of fact to
support its award of attorney fees to plaintiff. North Carolina
case law "'is clear that to overturn the trial judge's
determination, the defendant must show an abuse of discretion.'"
Blackmon v. Bumgardner, 135 N.C. App. 125, 130, 519 S.E.2d 335, 338
(1999) (quoting Hillman v. United States Liability Ins. Co., 59
N.C. App. 145, 155, 296 S.E.2d 302, 309 (1982), disc. review
denied, 307 N.C. 468, 299 S.E.2d 221 (1983)). Abuse of discretion
results where the court's ruling "'"is manifestly unsupported by
reason or so arbitrary that it could not have been the result of a
reasoned decision."'" Id. "The scope of appellate review . . . is
strictly limited to determining whether the trial judge's
underlying findings of fact are supported by competent evidence, in
which event they are conclusively binding on appeal, and whether
those factual findings in turn support the judge's ultimate
conclusions of law." State v. Cooke, 306 N.C. 132, 134, 291 S.E.2d
618, 619 (1982). Without a showing of abuse of the trial judge's
discretion, the trial judge's determination to award counsel fees
will not be overturned. Whitfield v. Nationwide Mutual Ins. Co., 86
N.C. App. 466, 469, 358 S.E.2d 92, 94 (1987). "As a general rule, in the absence of some contractual
obligation or statutory authority, attorney fees may not be
recovered by the successful litigant as damages or a part of the
court costs." Washington v. Horton, 132 N.C. App. 347, 349, 513
S.E.2d. 331, 333 (1999). N.C. Gen. Stat. § 6-21.1 (1999) provides:
In any personal injury or property damage
suit, or suit against an insurance company
under a policy issued by the defendant
insurance company and in which the insured or
beneficiary is the plaintiff, upon a finding
by the court that there was an unwarranted
refusal by the defendant insurance company to
pay the claim which constitutes the basis of
such suit, instituted in a court of record,
where the judgment for recovery of damages is
ten thousand dollars ($10,000) or less, the
presiding judge may, in his discretion, allow
a reasonable attorney fee to the duly licensed
attorney representing the litigant obtaining a
judgment for damages in said suit, said
attorney's fee to be taxed as a part of the
court costs.
This section creates an exception to the general rule that
attorney fees are not allowable as part of the costs in civil
actions. Hill v. Jones, 26 N.C. App. 168, 169, 215 S.E.2d 168,
169, cert. denied, 288 N.C. 240, 217 S.E.2d 664 (1975). The
obvious purpose of N.C. Gen. Stat. § 6-21.1 is to provide relief
for a person who sustained injury or property damage in an amount
so small that, if he must pay counsel from his recovery, it is not
economically feasible to bring suit on his claim. Hicks v.
Albertson, 284 N.C. 236, 239, 200 S.E.2d 40, 42 (1973). "This
[remedial] statute . . . should be construed liberally to
accomplish the purpose of the Legislature and to bring within it
all cases falling within its intended scope." Id. at 239, 200S.E.2d at 42.
"'Statutory interpretation properly begins with an examination
of the plain words of the statute.'" West v. Tilley, 120 N.C. App.
145, 149, 461 S.E.2d 1, 3 (1995) (quoting Correll v. Division of
Social Services, 332 N.C. 141, 144, 418 S.E.2d 232, 235 (1992)).
Allowance of attorney fees under N.C. Gen. Stat. § 6-21.1 is, by
the express language of the statute, in the discretion of the
presiding judge. Hillman, 59 N.C. App. at 155, 296 S.E.2d at 309.
However, the wording of N.C. Gen. Stat. § 6-21.1 contemplates some
type of inquiry by the presiding judge before the court may
exercise its discretion in awarding a fee to plaintiff's counsel.
Id. at 154, 296 S.E.2d at 308.
Defendant is correct in arguing that a trial court's
discretion under N.C. Gen. Stat. § 6-21.1 is not unbridled. In
Washington, this Court stated
the trial court is to consider the entire
record in properly exercising its discretion,
including, but not limited to the following
factors: (1) settlement offers made prior to
the institution of the action . . . (2) offers
of judgment pursuant to Rule 68, and whether
the "judgment finally obtained" was more
favorable than such offers; (3) whether
defendant unjustly exercised "superior
bargaining power"; (4) in the case of an
unwarranted refusal by an insurance company,
the "context in which the dispute arose[;]"
(5) the timing of settlement offers; (6) the
amounts of the settlement offers as compared
to the jury verdict; and the whole record.
132 N.C. App. at 351, 513 S.E.2d at 334-35 (citations omitted). If
the trial court elects to award attorney fees, it must also enter
findings of fact as to the time and labor expended, skill required,customary fee for like work, and experience or ability of the
attorney based on competent evidence. Porterfield v. Goldkuhle,
137 N.C. App. 376, 378, 528 S.E.2d 71, 73 (2000).
Defendant argues the trial court made incomplete and
inadequate findings of fact with respect to Washington factors five
and six. We disagree. In the instant case, the trial court made
a total of eight findings of fact to support its award of attorney
fees to plaintiff. The timing and amount of settlement offers and
the amount of the jury verdict are significant factors for the
trial court to consider in determining whether to award attorney
fees. Culler v. Hardy, 137 N.C. App. 155, 159, 526 S.E.2d 698, 702
(2000). However, the trial court is not required to make detailed
findings for each factor. Tew v. West, 143 N.C. App. 534, 546
S.E.2d 183 (2001). As to factor five, the trial court found that
on 2 December 1999, defendant filed a lump sum offer of judgment of
$4,801.00 which included all damages, attorney fees taxable as
costs, interest and the remaining costs accrued at the time the
offer was served. As to factor six, the trial court found that on
22 August 2000, a jury returned a verdict for plaintiff in the
amount of $4,500.00, and the judgment finally obtained exceeded
defendant's offer of judgment. As to the final award of attorney
fees taxed against defendant, the trial court made adequate
findings of fact to support its conclusion that the reasonable
value of services rendered by plaintiff's attorney was $4,880.00.
Defendant also argues the statement by the trial court
verifying it considered all Washington factors is not a finding offact which would allow meaningful appellate review of the trial
court's exercise of discretion in this case. We disagree. Mere
recitation by the trial court that it has considered all Washington
factors without additional findings of fact would be inadequate and
would not allow for meaningful appellate review. The fact that the
trial court in the instant case made additional findings of fact
preserves its ruling on appeal. To support its award of attorney
fees to plaintiff, the trial court made eight findings of fact.
The trial court listed only those facts matching those Washington
factors apposite to the instant case. Factor one is immaterial to
the instant case because neither party made any settlement offers
prior to the institution of the action. Factor three is irrelevant
to the instant case because in consideration of Washington factors,
the trial court did not mention that defendant may have unjustly
exercised superior bargaining power. See also Tew, 143 N.C. App. at
537, 546 S.E.2d at 185. Factor four is inapplicable to the instant
case. The trial court is not required to make an unwarranted
refusal finding to award attorney fees in an automobile accident
case, since such finding is only required in suits brought by an
insured or a beneficiary against an insurance company defendant.
Washington, 132 N.C. App. at 350, 513 S.E.2d at 334.
[2]Defendant next argues that the trial court erred in
concluding the judgment finally obtained exceeded the offer of
judgment. We disagree. Under the North Carolina Rules of Civil
Procedure,
[a]t any time more than 10 days before the
trial begins, a party defending against aclaim may serve upon the adverse party an
offer to allow judgment to be taken against
him for the money or property or to the effect
specified in his offer . . . . If the judgment
finally obtained by the offeree is not more
favorable than the offer, the offeree must pay
the costs incurred after the making of the
offer.
N.C. Gen. Stat. § 1A-1, Rule 68 (1999). "[W]ithin the confines of
Rule 68, 'judgment finally obtained' means the amount ultimately
entered as representing the final judgment, i.e., the jury's
verdict as modified by any applicable adjustments, by the
respective court in the particular controversy, not simply the
amount of the jury's verdict." Poole v. Miller, 342 N.C. 349, 353,
464 S.E.2d 409, 411 (1995), reh'gs denied, 342 N.C. 666, 467 S.E.2d
722 (1996) (emphasis added). In Roberts v. Swain, 353 N.C. 246,
538 S.E.2d 566 (2000), the North Carolina Supreme Court held that
in calculating the judgment finally obtained, any applicable
adjustments to a jury's verdict include not only pre-offer costs,
but also costs incurred after the offer of judgment but prior to
the entry of judgment by the trial court. In the instant case,
costs include reasonable attorney fees. See also Tew, 143 N.C. App.
at 538, 546 S.E.2d at 186.
Here, defendant made an original settlement offer in the
amount of $4,800.00. The next day, defendant increased his
previous settlement offer by only one dollar in the form of a lump
sum offer of judgment in the amount of $4,801.00. Prior to entry
of final judgment, plaintiff submitted costs totaling $1,207.00 and
63 hours of time for legal services at a rate of $122.00 per hour
for a total of $7,686.00 in attorney fees. The trial courtsignificantly reduced these amounts in its order dated 15 September
2000, and awarded plaintiff $1,134.30 in costs plus $4,880.00 in
attorney fees. Even without including plaintiff's attorney fees in
the judgment finally obtained, defendant's offer of judgment was
clearly less favorable than the final judgment awarded to
plaintiff. Proper inclusion of attorney fees into plaintiff's
final judgment only increases the disparity between defendant's
offer of judgment ($4,801.00) and plaintiff's judgment finally
obtained ($1,134.30 + $4,880.00 + $4,500.00 = $10,514.30).
The trial court did not err in concluding that the judgment
finally obtained by plaintiff was greater than the amount offered
by defendant. We agree with the trial court that plaintiff's costs
and attorney fees should be taxed against defendant pursuant to
N.C. Gen. Stat. § 6-21.1 and Rule 68.
For the foregoing reasons, we reject defendant's assignments
of error and affirm the judgment of the trial court.
Affirmed.
Judges WALKER and THOMAS concur.
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