Case Title: KEVIN SMITH V LOUIE KHOURI

Citation: 

Docket Number: 132823

State: michigan

Court: Michigan Supreme Court

Date: 2008-07-02T00:00:00Z

Document:
Michigan Supreme Court 
Lansing, Michigan 
Chief Justice:  
Justices: 
Clifford W. Taylor  
Michael F. Cavanagh 
Elizabeth A. Weaver 
Marilyn Kelly 
Opinion 
Maura D. Corrigan 
Robert P. Young, Jr. 
Stephen J. Markman 
FILED JULY 2, 2008 
KEVIN SMITH, 
Plaintiff-Appellee, 
v 
No. 132823 
LOUIE KHOURI, D.D.S., LOUIE 
KHOURI, D.D.S., P.C., and ADVANCED 
DENTAL CARE CLINIC, L.L.C., 
 
Defendant-Appellant. 
BEFORE THE ENTIRE BENCH 
TAYLOR, C. J. 
In this case, we review a trial court’s award of “reasonable” attorney fees as 
part of case-evaluation sanctions under MCR 2.403(O) calculated under some of 
the factors we listed in Wood v Detroit Automobile Inter-Ins Exch, 413 Mich 573; 
321 NW2d 653 (1982), and Rule 1.5(a) of the Michigan Rules of Professional 
Conduct. We take this opportunity to clarify that the trial court should begin the 
process of calculating a reasonable attorney fee by determining factor 3 under 
MRPC 1.5(a), i.e., the reasonable hourly or daily rate customarily charged in the 
locality for similar legal services, using reliable surveys or other credible 
 
 
 
 
 
 
                                              
evidence. This number should be multiplied by the reasonable number of hours 
expended. This will lead to a more objective analysis.  After this, the court may 
consider making adjustments up or down in light of the other factors listed in 
Wood and MRPC 1.5(a).  In order to aid appellate review, the court should briefly 
indicate its view of each of the factors. 
Given that the trial court made its decision without first determining the 
reasonable hourly or daily rate customarily charged in the locality for similar legal 
services, we vacate the lower court judgments regarding the case-evaluation 
sanctions and remand the case to the trial court to revisit the issue in light of the 
opinion we adopt today. 
I. STATEMENT OF PROCEEDINGS 
Plaintiff sued defendants in 2003 for dental malpractice in the Oakland 
Circuit Court. The case went to case evaluation and was evaluated at $50,000. 
Plaintiff accepted the award but defendants rejected it.  After a 2½-day trial, the 
jury returned a verdict in favor of plaintiff.  The verdict, reduced to present value,1 
was $46,631.18. 
After defendants’ motion for judgment notwithstanding the verdict or for a 
new trial was denied, plaintiff filed a motion in January 2005 seeking case­
1 All but $300 of the verdict consisted of future noneconomic damages, 
which were set at $2,800 a year for the remaining 36 years of plaintiff’s life 
expectancy.  Pursuant to MCL 600.6306, those future noneconomic damages were 
reduced to their present value.   
2  
 
 
 
 
 
 
 
 
 
                                              
evaluation sanctions under MCR 2.403.  Plaintiff sought $68,706.50 in attorney 
fees for time spent by four lawyers at the firm that represented him.  In particular, 
plaintiff sought $450 an hour for the 102 hours2 lead trial attorney Robert 
Gittleman claimed, $450 an hour for six hours claimed by another partner, $275 an 
hour for 59 hours attributable to one associate, and $275 an hour for 14 hours 
claimed by another associate. Plaintiff’s motion was supported by several items, 
including Mr. Gittleman’s curriculum vitae showing his extensive experience in 
trying dental malpractice cases.  Plaintiff’s motion also attached copies of three 
circuit court judgments awarding Mr. Gittleman attorney fees: a 1985 case 
awarding $200 an hour, a 1998 case awarding $300 an hour, and a 2004 case 
awarding $400 an hour. Plaintiff also represented that the other partner had been 
practicing law for 35 years and had tried numerous cases that resulted in favorable 
verdicts. The motion also indicated that the associates had both tried personal 
injury cases to conclusion and that $275 an hour was the going rate for their work 
and research, which were necessitated by the evaluation rejection. 
Defendants presented numerous objections, arguing that the requested 
attorney fees would be highly unreasonable if they were awarded and specifically 
challenged the rate of $450 an hour and the fact that the fees sought exceeded the 
judgment. They contrasted the requested $450 an hour rate and the relatively 
2 Plaintiff stipulated a reduction of seven hours from the time Mr. Gittleman 
claimed after defendants objected to the claim. 
3  
 
 
 
 
                                              
small verdict with a recent Court of Appeals case, Zdrojewski v Murphy, 254 Mich 
App 50; 657 NW2d 721 (2002), in which a plaintiff’s attorney had sought $350 an 
hour but had only been awarded $150 an hour in case-evaluation sanctions in a 
personal injury case where the verdict had been $900,000.  An objection was also 
made that some of the billings were duplicative, in that it was unnecessary for two 
lawyers to jointly try the same relatively simple two-day case.3  Defense counsel 
indicated that his challenge was not so much to the hours claimed (other than the 
duplication claim), but to the rates sought.  However, he did not seek an 
evidentiary hearing. Instead, he agreed to have the court decide the motion on the 
basis of what had been submitted. 
The trial court indicated its belief that $450 an hour was a reasonable rate 
for Mr. Gittleman. The court took judicial notice of the fact that senior trial 
practitioners in Oakland County bill rates of about $450 an hour.  The judge 
indicated that he had reviewed the billings and that he did not believe there was 
any duplication. The court said that Mr. Gittleman was a recognized practitioner 
in the area of dental malpractice and that he had a superlative standing in that area, 
having tried numerous cases.  The court, however, did not make any findings 
relevant to the other partner or the associates.  The court concluded by stating that 
3 For example, Mr. Gittleman charged eight hours for a full day of trial on 
December 17, 2004, and one of the associates also charged eight hours for that 
same day. Further, Mr. Gittleman billed five hours for the third day of trial while 
an associate charged eight hours for the same day.  
4  
 
 
 
 
 
                                              
 
 
the entire amount claimed was reasonable and signed an order granting attorney 
fees of $65,556 (the claimed amount of $68,706.50 minus the stipulation to drop 
seven hours attributable to Mr. Gittleman).4 
Defendants appealed in the Court of Appeals, arguing that the hourly rates 
were unreasonable, and attaching an article from the November 2003 issue of the 
Michigan Bar Journal5 showing that the median billing rate for equity partners in 
Michigan was $200 an hour and $150 an hour for associates. 
The panel affirmed in an unpublished opinion.6  It rejected defendants’ 
claim that the amount of the attorney-fee award was excessive because it was 
based on unreasonable hourly rates.  The Court of Appeals agreed with the trial 
court that $450 an hour was a reasonable rate for Mr. Gittleman.  The panel 
conceded that the data submitted by defendants showed lower rates, but concluded 
that the data did not reflect the range of hourly rates charged by attorneys who 
specialize in complex litigation such as dental malpractice.  It acknowledged that 
the trial court had not made any findings regarding the other three attorneys. 
Nevertheless, the panel found sufficient the trial court’s overall statements 
regarding the complexity of dental malpractice cases as well as the skill, time, and 
cost expended to obtain the favorable verdict.  Finally, the Court of Appeals 
4 Plaintiff was awarded $23,623.99 in costs. 
5 Stiffman, A snapshot of the economic status of attorneys in Michigan, 82 
Mich B J 20 (November 2003).   
6 Smith v Khouri, unpublished opinion per curiam, issued November 16, 
2006 (Docket No. 262139).   
5  
 
 
 
 
 
 
 
 
 
 
 
 
 
                                              
   
refused to follow Zdrojewski because there was evidence that courts of this state 
had consistently awarded attorney fees for Mr. Gittleman’s services at hourly rates 
higher than the $150 an hour approved in Zdrojewski. 
Defendants appealed in this Court, and we granted leave to appeal limited 
to the case-evaluation sanction issue, asking the parties to address several issues 
relating to the Wood factors and also invited briefs from several amici curiae.7 
II. STANDARD OF REVIEW 
A trial court’s decision whether to grant case-evaluation sanctions under 
MCR 2.403(O) presents a question of law, which this Court reviews de novo. 
Casco Twp v Secretary of State, 472 Mich 566, 571; 701 NW2d 102 (2005); 
Allard v State Farm Ins Co, 271 Mich App 394, 397; 722 NW2d 268 (2006).  We 
review for an abuse of discretion a trial court’s award of attorney fees and costs. 
Wood, 413 Mich at 588. An abuse of discretion occurs when the trial court’s 
decision is outside the range of reasonable and principled outcomes. Maldonado v 
Ford Motor Co, 476 Mich 372, 388; 719 NW2d 809 (2006).   
III. LEGAL BACKGROUND 
A. PURPOSE OF THE RULE 
The general “American rule” is that “attorney fees are not ordinarily 
recoverable unless a statute, court rule, or common-law exception provides the 
contrary.” Nemeth v Abonmarche Dev, Inc, 457 Mich 16, 37-38; 576 NW2d 641 
7 479 Mich 852 (2007). 
6  
 
 
 
  
 
                                              
 
(1998); Haliw v Sterling Hts, 471 Mich 700, 706; 691 NW2d 753 (2005). 
Consistently with the American rule, this Court has specifically authorized case­
evaluation sanctions through court rule, allowing the awarding of reasonable 
attorney fees to promote early settlements.8  The examination of those rules and 
the extent fees can be awarded is at issue in this case. 
MCR 2.403 is the Michigan court rule regarding case evaluation.  The rule 
holds that if both parties accept a case evaluation, the action is considered settled 
and judgment will be entered in accordance with the evaluation.9  However, if one 
party accepts the award and one rejects it, as happened here, and the case proceeds 
to a verdict, the rejecting party must pay the opposing party’s actual costs unless 
the verdict is, after several adjustments, 10 percent more favorable to the rejecting 
party than the case evaluation.10  Actual costs are defined in MCR 2.403(O)(6) as 
those costs taxable in any civil action and “a reasonable attorney fee based on a 
8 In 2000, the name of the process described in MCR 2.403 was changed 
from “mediation” to “case evaluation.” The term “mediation” now applies to the 
process described in MCR 2.411 (domestic relations mediation). 
9 MCR 2.403(M)(1). 
10 MCR 2.403(O)(3) provides that a verdict must be adjusted by adding to it 
assessable costs and interest and that, after this adjustment, the verdict is 
considered more favorable to a defendant “if it is more than 10 percent below the 
evaluation . . . .” As we explained in Haliw, 471 Mich at 711, actual costs do not 
include attorney fees incurred when responding to appeals.  Moreover, as 
explained in Rafferty v Markovitz, 461 Mich 265, 272-273 n 6; 602 NW2d 367 
(1999), attorney fees are not allowed under the court rule if they have already been 
recovered pursuant to a statute.  As we held in Rafferty, double recovery of 
attorney fees under two different authorities is not appropriate, even if the 
authorities advance different purposes.   
7  
 
 
 
 
 
 
                                              
  
 
 
reasonable hourly or daily rate as determined by the trial judge for services 
necessitated by the rejection of the case evaluation.” 
The purpose of this fee-shifting provision is to encourage the parties to 
seriously consider the evaluation and provide financial penalties to the party that, 
as it develops, “should” have accepted but did not. This encouragement of 
settlements is traditional in our jurisprudence as it deters protracted litigation with 
all its costs and also shifts the financial burden of trial onto the party who 
imprudently rejected the case evaluation. Rohl v Leone, 258 Mich App 72, 75; 
669 NW2d 579 (2003); Bennett v Weitz, 220 Mich App 295, 301; 559 NW2d 354 
(1996). This rule, however, is not designed to provide a form of economic relief 
to improve the financial lot of attorneys or to produce windfalls.11  Rather, it only 
permits an award of a reasonable fee, i.e., a fee similar to that customarily charged 
in the locality for similar legal services, which, of course, may differ from the 
actual fee charged12 or the highest rate the attorney might otherwise command. 
As Coulter v Tennessee, 805 F2d 146, 148 (CA 6, 1986), explains, reasonable fees 
“are different from the prices charged to well-to-do clients by the most noted 
lawyers and renowned firms in a region.” 
11 See Pennsylvania v Delaware Valley Citizens’ Council for Clean Air, 
478 US 546, 565; 106 S Ct 3088; 92 L Ed 2d 439 (1986) (“[T]hese [attorney-fee 
shifting] statutes were not designed as a form of economic relief to improve the 
financial lot of attorneys . . . .”).   
12 “Reasonable fees are not equivalent to actual fees charged.” Zdrojewski, 
254 Mich App at 72. 
8  
 
 
 
 
 
                                              
B. PLAINTIFF WAS ENTITLED TO CASE-EVALUATION SANCTIONS 
Defendants here have correctly conceded that case-evaluation sanctions 
were applicable because, even ignoring the costs and interest of $23,623.99 that 
are to be added to the verdict, the verdict as reduced to its present value of 
$46,631.18 was not more than 10 percent less than the $50,000 case-evaluation 
amount.   
C. DETERMINING A REASONABLE ATTORNEY FEE 
As all agree, the burden of proving the reasonableness of the requested fees 
rests with the party requesting them. Petterman v Haverhill Farms, Inc, 125 Mich 
App 30, 33; 335 NW2d 710 (1983).13  In Michigan, the trial courts have been 
required to consider the totality of special circumstances applicable to the case at 
hand. Smolen v Dahlmann Apartments, Ltd, 186 Mich App 292, 297; 463 NW2d 
261 (1990); Hartman v Associated Truck Lines, 178 Mich App 426, 431; 
444NW2d 159 (1989). 
Wood listed the following six factors were to be 
considered in determining a reasonable attorney fee: 
(1) the professional standing and experience of the attorney; 
(2) the skill, time and labor involved; (3) the amount in question and 
the results achieved; (4) the difficulty of the case; (5) the expenses 
incurred; and (6) the nature and length of the professional 
13 Accord Hensley v Eckerhart, 461 US 424, 433; 76 L Ed 2d 40; 103 S Ct 
1933 (1983) (stating that the party seeking the fee award bears the burden of 
proving the reasonableness of the hours worked and the hourly rates claimed); 
Blum v Stenson, 465 US 886, 896 n 11; 104 S Ct 1541; 79 L Ed 2d 891 (1984). 
9  
 
 
 
 
 
 
                                              
 
 
relationship with the client. [Wood, 413 Mich at 588 (citation 
omitted)].[14] 
The trial courts have also relied on the eight factors listed in Rule 1.5(a) of the 
Michigan Rules of Professional Conduct, see, e.g., Dep’t of Transportation v 
Randolph, 461 Mich 757; 610 NW2d 893 (2000), and In re Condemnation of 
Private Prop for Hwy Purposes (Dep’t of Transportation v D & T Constr Co), 209 
Mich App 336, 341-342; 530 NW2d 183 (1995), which overlap the Wood factors 
and include:  
(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 legal 
services; 
(4) the amount involved and the results obtained; 
(5) the time limitations imposed by the client or by 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.  [MRPC 1.5(a).] 
14 These factors were traceable to Crawley v Schick, 48 Mich App 728, 737; 
211 NW2d 217 (1973). Crawley relied in part on then-applicable Disciplinary 
Rule 2-106(B) of the Code of Professional Responsibility and Ethics.   
We also stated in Wood that a trial court is not limited to those factors in 
making its determination and that the trial court need not detail its findings on 
each specific factor considered. Wood, 413 Mich at 588. We clarify today that in 
order to aid appellate review, the court should briefly address its view of each of 
the factors on the record. 
10  
 
 
 
 
 
 
 
In determining “the fee customarily charged in the locality for similar legal 
services,” the trial courts have routinely relied on data contained in surveys such 
as the Economics of the Law Practice Surveys that are published by the State Bar 
of Michigan. 
See, e.g., Zdrojewski, 254 Mich App at 73; Temple v Kelel 
Distributing Co Inc, 183 Mich App 326, 333; 454 NW2d 610 (1990).  The above 
factors have not been exclusive, and the trial courts could consider any additional 
relevant factors. Wood, 413 Mich at 588. 
IV. ANALYSIS 
We conclude that our current multi-factor approach needs some fine tuning. 
We hold that a trial court should begin its analysis by determining the fee 
customarily charged in the locality for similar legal services, i.e., factor 3 under 
MRPC 1.5(a). In determining this number the court should use reliable surveys or 
other credible evidence of the legal market.  This number should be multiplied by 
the reasonable number of hours expended in the case (factor 1 under MRPC 1.5[a] 
and factor 2 under Wood).  The number produced by this calculation should serve 
as the starting point for calculating a reasonable attorney fee.  We believe that 
having the trial court consider these two factors first will lead to greater 
consistency in awards. 
Thereafter, the court should consider the remaining 
Wood/MRPC factors to determine whether an up or down adjustment is 
11  
 
 
 
   
 
 
 
                                             
 
 
appropriate.  And, in order to aid appellate review, a trial court should briefly 
discuss its view of the remaining factors.15 
The reasonable hourly rate represents the fee customarily charged in the 
locality for similar legal services, which is reflected by the market rate for the 
attorney’s work.  “The market rate is the rate that lawyers of similar ability and 
experience in the community normally charge their paying clients for the type of 
work in question.”  Eddleman v Switchcraft, Inc, 965 F2d 422, 424 (CA 7, 1992) 
(citation and quotation omitted). We emphasize that “the burden is on the fee 
applicant to produce satisfactory evidence—in addition to the attorney’s own 
affidavits—that the requested rates are in line with those prevailing in the 
community for similar services by lawyers of reasonably comparable skill, 
experience and reputation.” Blum v Stenson, 465 US 886; 895 n 11; 104 S Ct 
1541; 79 L Ed 2d 891 (1984).  The fees customarily charged in the locality for 
similar legal services can be established by testimony or empirical data found in 
surveys and other reliable reports. But, we caution that the fee applicant must 
present something more than anecdotal statements to establish the customary fee 
for the locality. Both the parties and the trial courts of this state should avail 
themselves of the most relevant available data.  For example, as noted earlier, in 
15 Wood, 413 Mich at 588, held that trial courts were “not limited to [the six 
listed] factors in making [their] determination[s].”  To the extent a trial court 
considers any factor not enumerated in Wood or MRPC 1.5(a), the court should 
expressly indicate this and justify the relevance and use of the new factor. 
12  
 
 
 
 
 
 
 
 
                                              
 
 
this case defendant submitted an article from the Michigan Bar Journal regarding 
the economic status of attorneys in Michigan.16  By recognizing the importance of 
such data, we note that the State Bar of Michigan, as well as other private entities, 
can provide a valuable service by regularly publishing studies on the prevailing 
market rates for legal services in this state.  We also note that the benefit of such 
studies would be magnified by more specific data relevant to variations in locality, 
experience, and practice area. 
In considering the time and labor involved (factor 1 under MRPC 1.5[a] 
and factor 2 under Wood) the court must determine the reasonable number of 
hours expended by each attorney.17  The fee applicant must submit detailed billing 
records, which the court must examine and opposing parties may contest for 
reasonableness. The fee applicant bears the burden of supporting its claimed 
hours with evidentiary support.  If a factual dispute exists over the reasonableness 
of the hours billed or hourly rate claimed by the fee applicant, the party opposing 
the fee request is entitled to an evidentiary hearing to challenge the applicant’s 
evidence and to present any countervailing evidence.   
16 See note 5, supra. The trial court did not have this report. It was first 
submitted to the Court of Appeals. 
17 Norman v Housing Auth of Montgomery, 836 F2d 1292, 1301 (CA 11, 
1988), quoting Hensley, 461 US at 434 (in determining hours reasonably 
expended, the Court should exclude “excessive, redundant or otherwise 
unnecessary” hours regardless of the attorneys’ skill, reputation or experience). 
13  
 
 
 
 
  
 
 
                                              
Multiplying the reasonable hourly rate by the reasonable hours billed will 
produce a baseline figure. After these two calculations, the court should consider 
the other factors and determine whether they support an increase or decrease in the 
base number. 
Having clarified how a trial court should go forward in calculating a 
reasonable attorney fee, we find it appropriate to vacate the award and remand this 
case to the trial court for reconsideration under this opinion.  We offer the 
following observations in order to provide guidance to the trial court.   
In making its ruling, the trial court indicated it was taking judicial notice of 
the fact that top trial attorneys in Oakland County charge $450 an hour or more.18 
While we do not doubt that some trial attorneys have such rates, the fee 
customarily charged in the locality for similar legal services, which likely is 
different, should be the measure. That is, reasonable fees are different from the 
fees paid to the top lawyers by the most well-to-do clients.  Coulter, supra.  The 
trial court also erred in relying on previous awards Mr. Gittleman obtained without 
considering whether those fees might have been justified by the particular 
circumstances of the earlier cases, such as the complexity and skill required. 
18 We note that the hourly rate charged by top trial attorneys in Oakland 
County was not a proper fact for judicial notice.  A judicially noticed fact must be 
“one not subject to reasonable dispute in that it is either (1) generally known 
within the territorial jurisdiction of the trial court or (2) capable of accurate and 
ready determination by resort to sources whose accuracy cannot reasonably be 
questioned.”  MRE 201(b). 
14  
 
 
 
 
 
  
 
 
   
                                              
 
 
 
 
 
 
Moreover, the trial court erred when it conclusorily stated that Mr. Gittleman had 
tried the case in a “professional manner,” without further explanation, because this 
is something all attorneys should be expected to do. 
As previously noted, the trial court only made findings regarding Mr. 
Gittleman. On remand, the court should be careful to perform a separate analysis 
with reference to the other three attorneys, considering both the hourly rate and the 
number of hours reasonably expended, and should consider whether it was 
reasonable for plaintiff’s firm to have two lawyers “on the clock” during the trial.   
We reiterate that the goal of awarding attorney fees under MCR 2.403 is to 
reimburse a prevailing party for its “reasonable” attorney fee; it is not intended to 
“replicate exactly the fee an attorney could earn through a private fee arrangement 
with his client.”19  We also caution the courts to avoid duplicative consideration of 
the factors mentioned above.20 
19 Delaware Valley, 478 US at 565; see also Cleary v The Turning Point, 
203 Mich App 208, 212; 512 NW2d 9 (1993). 
20 Factor 3 under Wood, 413 Mich at 588, and factor 4 under MRPC 1.5(a), 
is “the amount in question and the results achieved.”  Although this factor may be 
relevant in other situations, we conclude that it is not a relevant consideration in 
determining a reasonable attorney fee for case-evaluation sanctions.  As stated, the 
purpose of MCR 2.403(O) is to encourage serious consideration of case-evaluation 
awards and penalize a party that “should have” accepted the case evaluation.  The 
rejecting party that does not achieve a more favorable result must pay reasonable 
attorney fees “for services necessitated by the rejection . . . .”  MCR 2.403(O)(6). 
It would be inconsistent with MCR 2.403(O) to reduce the accepting party’s 
reasonable attorney fees “for services necessitated by the rejection” on the basis of 
the amount in question or the results achieved.  The accepting party properly 
evaluated the case value, yet was forced to incur additional fees, potentially in 
(continued…) 
15  
 
 
 
 
  
                                              
 
 
V. RESPONSE TO THE DISSENT 
The dissent’s primary complaint seems to be that a “reasonable fee” for an 
exceptional lawyer cannot be determined by using the fee charged by the average 
attorney. But Wood factor 1 mentions the professional standing and experience of 
the attorney, Wood factor 2 mentions the skill involved, and MRPC 1.5(a)(7) 
speaks of “the experience, reputation, and ability of the lawyer.” These factors 
allow an upward adjustment for the truly exceptional lawyer.   
The dissent criticizes our use of the market rate for attorney services to 
determine a reasonable rate, stating that “the market rate for an individual 
attorney’s work is not some figure that can be plucked from a reference manual or 
interpolated from a statistical graph.” Post at 10. To an extent, we agree; see note 
19 of this opinion, explaining that the fee charged by top trial lawyers in Oakland 
County is not a proper fact for judicial notice.  This is not an exact science; if it 
(…continued)  
excess of the case value. Reducing the accepting party’s reasonable attorney fees  
necessitated by the rejection because they exceed or are disproportionate to the  
value the accepting party correctly assessed undermines the rule.  MCR 2.403(O)  
penalizes the rejecting party who incorrectly valued the case, not the accepting  
party who correctly assessed the case value at a much earlier and efficient time.  
Reducing the accepting party’s reasonable attorney fees on the basis of more  
proportionally simply encourages the inefficiency the rule seeks to combat.  
Although factor 8 under MRPC 1.5(a), “whether the fee is fixed or 
contingent,” may be relevant in other situations, we conclude that it is not relevant 
in determining a reasonable attorney fee for case-evaluation sanctions.  Again, 
sanctions under MCR 2.403 are to reimburse a party for reasonable legal fees for 
services necessitated by the rejection of the case evaluation.  Whether the 
attorney-fee agreement is fixed or contingent is unrelated to the legal services 
necessitated by the rejection of a case evaluation. 
16  
 
 
 
 
 
 
were, no factors or analysis would be required.  We merely aim to provide a 
workable, objective methodology for assessing reasonable attorney fees that 
Michigan courts can apply consistently to our various fee-shifting rules and 
statutes. To that end, we are persuaded by the guidance offered by the United 
States Supreme Court in Blum, and we note that the dissent offers no similar, 
countervailing guidance. 
The dissent agrees with the Supreme Court’s assessment in Blum that the 
market rate, although not always easily discerned, is a “valid inquiry.”  Post at 10. 
Nevertheless, it rejects the principled mechanism the Blum Court chose to best 
conduct the “valid inquiry” into the market rate.  Post at 10-11. We, however, 
accept the Blum Court’s resolution, placing the burden on the fee applicant “to 
produce satisfactory evidence—in addition to the attorney’s own affidavits—that 
the requested rates are in line with those prevailing in the community for similar 
services by lawyers of reasonably comparable skill, experience and reputation.” 
Blum, supra at 895 n 11. The dissent concedes that “assessing that rate should 
include comparisons with rates for similar services,” post at 10, but offers no 
rubric to guide Michigan courts in doing so.  Unlike the dissent, we choose to 
provide the guidance that has been, and the dissent would allow to remain, sorely 
lacking for the many Michigan courts that are asked to impose “reasonable 
attorney fees” under our fee-shifting rules and statutes. 
The dissent also faults us for using the fee customarily charged in the 
locality for similar legal services as a starting point.  See post at 4-5. We see no 
17  
 
 
 
 
 
                                              
 
fault in providing an objective baseline, i.e., a starting point, to aid trial and 
appellate courts alike in assessing a “reasonable fee.”  Whimsy is a double-edged 
sword. If a trial court awarded a highly experienced and skilled attorney, such as 
Mr. Gittleman, a “reasonable attorney fee” at a rate of $100 an hour—a rate well 
below the $150 an hour median rate for associate attorneys in Michigan21—we 
would have the same concerns with the absence of an objective framework to 
assess such a judgment. An objective starting point, at a minimum, provides a 
more concrete basis for setting and reviewing a reasonable attorney fee.  Again, 
we reject the dissent’s argument to leave Michigan courts without guidance. 
The dissent asserts that our decision is somehow inconsistent with 
Randolph, in which we rejected the federal lodestar method for calculating the 
reasonableness of an attorney fee under our condemnation statute.  In Randolph, 
we specifically noted that MCL 213.66(3) requires consideration of whether actual 
fees are reasonable, and that this is different from fee-shifting statutes that simply 
authorize the trial court to award “reasonable attorney fees” without regard to the 
fees actually charged. Id. at 765-766. Contrary to the dissent’s assertion, our 
opinion today does not contradict, undermine, or overrule Randolph. 
VI. CONCLUSION 
In determining a reasonable attorney fee, a trial court should first determine 
the fee customarily charged in the locality for similar legal services.  In general, 
21 See Snapshot, supra. 
18  
 
 
 
 
 
 
the court shall make this determination using reliable surveys or other credible 
evidence. Then, the court should multiply that amount by the reasonable number 
of hours expended in the case. The court may consider making adjustments up or 
down to this base number in light of the other factors listed in Wood and MRPC 
1.5(a). In order to aid appellate review, the court should briefly indicate its view 
of each of the factors. 
The judgments of the Court of Appeals and the trial court regarding the 
attorney-fee issue are vacated, and the case is remanded to the trial court for 
reconsideration in light of this opinion. 
Clifford W. Taylor 
Robert P. Young, Jr. 
19  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
v 
S T A T E O F M I C H I G A N 
SUPREME COURT 
KEVIN SMITH, 
Plaintiff-Appellee, 
No. 132823 
LOUIE KHOURI, D.D.S., LOUIE 
KHOURI, D.D.S., P.C., and ADVANCED 
DENTAL CARE CLINIC, L.L.C., 
 
Defendant-Appellant. 
CORRIGAN, J. 
I concur with the reasoning and result of the lead opinion, with one 
exception. I disagree with the conclusion that two factors should be eliminated 
from consideration when determining a reasonable attorney fee for case evaluation 
sanctions; namely, the “results obtained” and whether the fee is fixed or 
contingent.  See ante at 15 n 20. Both Wood v Detroit Automobile Inter-Ins Exch, 
413 Mich 573; 321 NW2d 653 (1982), and MRPC 1.5(a) specifically list these two 
factors as considerations when assessing reasonable attorney fees without 
limitation. 
No principled basis exists for excluding these factors from 
consideration in the case evaluation context, nor is there any textual support for 
such exclusion in either Wood or MRPC 1.5(a). Therefore, both factors should be 
considered, along with all the other factors listed in Wood and the MRPC, when 
assessing reasonable attorney fees for case evaluation sanctions.  Consideration of 
 
 
 
 
   
 
 
 
 
 
 
                                              
 
these factors does not, however, affect the trial court’s ultimate authority to 
determine which factors, if any, justify an adjustment to the base calculation of 
reasonable attorney fees obtained by multiplying the reasonable hourly rate by the 
reasonable number of hours expended. 
Wood lists the factors a court should consider when awarding reasonable 
attorney fees: 
(1) the professional standing and experience of the 
attorney; (2) the skill, time and labor involved; (3) the amount in 
question and the results achieved; (4) the difficulty of the case; (5) 
the expenses incurred; and (6) the nature and length of the 
professional relationship with the client.[1] 
Similarly, MRPC 1.5(a) lists the factors to be considered in determining the 
reasonableness of an attorney fee: 
(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 
legal services; 
(4) the amount involved and the results obtained;  
(5) the time limitations imposed by the client or by the 
circumstances;  
1 Wood, supra at 588 (citation and quotation omitted). 
2  
 
 
 
 
 
   
 
 
                                              
(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.[2] 
The lead opinion correctly concludes that trial courts should consider each 
of these factors when determining whether to adjust the base reasonable attorney 
fee calculation. 
Nevertheless, it then contradictorily concludes that when 
awarding reasonable attorney fees for case evaluation sanctions under MCR 
2.403(O), a court is barred from considering factor #3 in Wood (#4 in the MRPC), 
concerning the “results obtained,” and factor #8 in the MRPC, “whether the fee is 
fixed or contingent.”  MCR 2.403(O)(6)(b) requires that a trial court award “a 
reasonable attorney fee based on a reasonable hourly or daily rate as determined 
by the trial judge for services necessitated by the rejection of the case evaluation.” 
The plain language of the rule merely requires that the court award a “reasonable 
attorney fee”; it does not suggest that “reasonable attorney fee” means something 
different for case evaluation sanctions than for any other situation.  Therefore, no 
justification exists for the lead opinion’s attempt to deviate from the reasonable 
attorney fee calculation when case evaluation sanctions are involved.  This carve­
out exception appears to arise from its assessment of what is fair rather than from 
the plain language of the court rule.  
2 MRPC 1.5(a). 
3  
 
 
 
 
 
 
                                              
 
Contrary to the assertion in the lead opinion, consideration of whether a fee 
is fixed or contingent may be helpful in determining a reasonable attorney fee 
award for case evaluation sanctions. If a court establishes that an attorney was 
working under a contingency fee agreement, knowledge of the percentage of the 
fee may prove to be a useful tool. Contingency fee percentages express an 
attorney’s expectations of the case and the risks involved.  While the actual 
percentage of a contingency fee need not be used in determining a reasonable fee 
award, this potentially useful information certainly should not be eliminated 
outright from consideration as a factor in a reasonableness analysis. 
Likewise, the results obtained can also be a relevant consideration when 
determining reasonable attorney fees in a case evaluation situation.  Although case 
authority specifically addressing the “results obtained” factor primarily involves 
situations where an adverse party is ordered to pay the other party’s attorney fees 
outside the case evaluation context, in “reasonable attorney fee” cases, courts 
consistently acknowledge the relevance of the results obtained.3  The majority 
provides no authority for its conclusion that the results obtained should be 
excluded from consideration when calculating reasonable attorney fees for case 
evaluation sanctions. 
3 See, e.g., City of Riverside v Rivera, 477 US 561, 574; 106 S Ct 2686; 91 
L Ed 2d 466 (1986); Hensley v Eckerhart, 461 US 424, 433; 103 S CT 1933; 76 L 
Ed 2d 40 (1983); Farrar v Hobby, 506 US 103, 115 113 S Ct 566; 121 L Ed 2d 
494 (1992); Davis v Southeastern Pennsylvania Transportation Auth, 924 F2d 51 
(CA 3, 1991); Kreimes v Dep’t of Treasury, 764 F2d 1186 (CA 6, 1985). 
4  
 
 
 
 
 
Within the milieu of fee shifting authority, apart from the limited category 
of case evaluation sanctions, civil rights cases most frequently articulate how a 
court should evaluate the reasonableness of an attorney fee award. In these cases, 
the prevailing party is entitled to collect fees from the adverse party.  City of 
Riverside v Rivera, 477 US 561, 574; 106 S Ct 2686; 91 L Ed 2d 466 (1986), 
states in a plurality opinion that the results obtained is “one of [the] many factors 
that a court should consider in calculating an award of attorney’s fees.”  Id. at 574. 
In another civil rights case, Hensley v Eckerhart, 461 US 424, 433; 103 S Ct 1933; 
76 L Ed 2d 40 (1983), the United States Supreme Court calls the “results 
obtained” factor “crucial” in the analysis of reasonable attorney fees.  Id. at 440. 
Hensley further specifies that its decision applies in cases not involving civil 
rights. Id. at 433. 
The Court of Appeals also has expressed concern about the proportionality 
of the attorney fees awarded to damages awards.  See Petterman v Haverhill 
Farms, Inc, 125 Mich App 30, 32; 335 NW2d 710 (1983); Burke v Angies, Inc, 
143 Mich App 683, 692-693; 373 NW2d 187 (1985).  In Petterman, the Court of 
Appeals noted that the $9,304 attorney fee that was charged for a claim evaluated 
at $12,500 raised serious questions regarding the reasonableness of the attorney 
fee award. In Burke, the Court of Appeals again considered this aspect but held 
that the $17,750 attorney fee was not excessive in light of the $175,000 damages 
award, i.e., approximately 10 percent of the amount of the damages award, and did 
5  
 
 
 
 
                                              
not rise to the level of Petterman, where the attorney fees were 75 percent of the 
amount of the damages award.  
The lead opinion seems to argue that case evaluation sanctions are 
singularly distinguishable from all other fee shifting cases.  I disagree. An award 
for attorney fees in a case evaluation sanction context is not so unlike an award for 
attorney fees in a civil rights case as to render the consideration of the 
proportionality “crucial” in one context and not a factor at all in the other.  Both 
types of cases involve fee shifting.  The majority describes the purpose of case 
evaluation sanctions as punishment of the party who did not accept the case 
evaluation and encouragement of parties to take the process seriously.4  But any 
situation where one party is ordered to pay the other’s attorney fees is inherently 
punitive. Civil rights cases allow the prevailing party to collect from the “losing” 
party, at least in part, to punish the losing party for necessitating the suit in the first 
place and to discourage both civil rights infringements and frivolous suits and 
defenses. Case evaluation situations are not so different from other attorney fee 
shifting cases to eliminate a factor from consideration that has otherwise 
consistently been included in the analysis. 
I do not contend that fee awards must always be proportional to results 
obtained. 
I simply suggest that considering the results obtained, while not 
4 See ante at 8. 
6  
 
 
 
   
 
 
                                              
requiring a proportionality rule, is reasonable and prudent. 
Moreover, it is 
consistent with federal precedent, including that which the majority cites.5 
The lead opinion suggests that when a party rejects a case evaluation that it 
“should” have accepted, the adverse party necessitated the accumulation of 
additional fees, perhaps fees above and beyond the true value of a case. 
Therefore, the lead opinion asserts that the rejecting party should be responsible 
for fees even if they are, as in this case, completely disproportionate to the 
damages award. It is true that some cases will involve parties who correctly 
valued their claims, accepted case evaluation, and were then forced to incur more 
fees than they could expect to receive in damages because the other party rejected 
the case evaluation. It is also conceivable, however, that some attorneys will, after 
accepting a case evaluation that the other side has rejected, proceed in a way that 
escalates the fees beyond any damages that could reasonably be expected in the 
case. To avoid such potential abuse, a trial court must consider whether fees may 
be disproportionate to a damages award as a part of the overall analysis.   
I see no principled reason for altering the factors that should be considered 
when assessing reasonable attorney fees for case evaluation sanctions.  Therefore, 
I respectfully disagree with the lead opinion. Both the “results obtained” and 
“whether a fee is fixed or contingent” are appropriate factors to consider in 
5 See, e.g., Riverside, supra; Hensley, supra; Davis, supra (considering 
results obtained as a factor but rejecting per se proportionality rule); and Kreimes, 
supra (holding that proportionality should not be the sole deciding factor).  
7  
 
 
 
 
assessing the reasonableness of attorney fee awards as case evaluation sanctions, 
along with all the other factors listed in Wood and the MRPC. 
Maura D. Corrigan 
Stephen J. Markman 
8  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
                                              
 
v   
S T A T E O F M I C H I G A N 
SUPREME COURT 
KEVIN SMITH, 
Plaintiff-Appellee, 
No. 132823 
LOUIE KHOURI, D.D.S., LOUIE KHOURI, 
D.D.S., P.C., and ADVANCED DENTAL 
CARE CLINIC, L.L.C., 
 
Defendant-Appellant, 
CAVANAGH, J. (dissenting). 
Today the majority says much, but changes little, in its attempt at “fine 
tuning,” ante at 11, our longstanding method for assessing reasonable attorney 
fees under MCR 2.403(O), which has remained unchanged since this Court 
unanimously adopted it 25 years ago in Wood v Detroit Automobile Inter-Ins 
Exch, 413 Mich 573; 321 NW2d 653 (1982).1  In fact, despite the majority’s 
attempt to aid appellate review and increase the consistency of reasonable 
attorney-fee awards, its new variation of the Wood-factors method changes little 
1 The Wood test for a reasonable attorney fee includes the following factors: 
(1) the professional standing and experience of the attorney; 
(2) the skill, time and labor involved; (3) the amount in question and 
the results achieved; (4) the difficulty of the case; (5) the expenses 
incurred; and (6) the nature and length of the professional 
relationship with the client. [Wood, supra at 588.] 
 
 
 
  
                                              
 
 
because, in the end, it still leaves the trial court with broad discretion in awarding 
reasonable attorney fees under the rule. Accordingly, I would not tinker with the 
Wood factors simply because in this case a contingency-fee attorney was awarded 
an hourly-rate fee that some on this Court would not have accepted had they been 
the trial judge. The Wood-factors method is not broken; therefore, I respectfully 
dissent from the majority’s attempt to fix it. 
 
In applying the Wood factors to this case, I would affirm the trial court’s 
determination regarding the reasonable attorney fee for plaintiff’s lead attorney, 
Mr. Gittleman, because that ruling was not an abuse of discretion, as it was guided 
by several of the Wood factors.2  Further, the trial court’s reasoning was supported 
by the information presented to the trial court, which included Mr. Gittleman’s 
curriculum vitae, previous decisions supporting similar fee awards for his services, 
and plaintiff’s billing records.  Also, defendant was offered an opportunity to 
contest these assertions at a hearing, but he expressly waived the opportunity. 
2 The trial court stated: 
There’s no question Mr. Gittleman’s a recognized practitioner 
in the area of dental malpractice and has superlative standing in that 
area, has tried numerous cases. His skill, time and labor involved 
here was evidence [sic] from the professional way in which this case 
was tried. The amount in question, the results achieved . . . that was 
significant. The case was of difficulty because of the complexity of 
the issues involved. . . . There were significant expense [sic] incurred 
based on my review of the billings and taking all of those factors 
into account, I think that the 450 dollars rate is reasonable. 
2  
 
 
 
 
 
 
                                              
 
Thus, I do not agree with the majority’s assertion that the attorney-fee award 
regarding Mr. Gittleman’s services requires further analysis. 
However, I do agree with the majority that the trial court did not conduct 
sufficient analysis to support its award of attorney fees regarding plaintiff’s 
second, third, and fourth chair attorneys.  Thus, regarding those awards, I would 
remand to the trial court for further analysis under our longstanding precedent in 
Wood. 
Turning to the majority’s new fine-tuned method, this new method begins 
by determining the fee customarily charged in the locality for similar legal 
services. The majority limits what may be used to establish the customary fee to 
“testimony or empirical data found in surveys and other reliable reports . . . [b]ut . 
. . the fee applicant must present something more than anecdotal statements to 
establish the customary fee for the locality.”  Ante at 12. The majority also 
requires the claimant to provide more than his attorney’s own affidavit as proof of 
the attorney’s hourly fee.3  Then, as an example of a reliable report, the majority 
accepts the Snapshot of the Economic Status of Attorneys in Michigan (Snapshot) 
3 The majority opinion states: “We emphasize that ‘the burden is on the fee 
applicant to produce satisfactory evidence—in addition to the attorney’s own 
affidavits—that the requested rates are in line with those prevailing in the 
community for similar services by lawyers of reasonably comparable skill, 
experience and reputation.’” Ante at 12. The majority does not explain why a 
sworn affidavit by an officer of the court and member of the bar is not sufficient 
proof of the facts attested to within, especially when those assertions are not 
countered by competing evidence. 
3  
 
 
 
 
 
 
   
  
                                              
 
  
 
 
that was published in the November 2003 issue of the Michigan Bar Journal.  In 
essence, the majority directs lower courts to use this report to start their analyses 
by finding the hourly rate for the average attorney in the applicable field and 
locality.4  Next, the majority requires this average fee to be multiplied by the 
reasonable number of hours expended in the case to give a baseline fee amount. 
Then, the majority allows trial courts to adjust the fee award upward or downward 
by applying “the remaining Wood/MRPC factors.” Ante at 11.5  Finally, the trial 
court must “briefly discuss its view of the remaining factors” in order to aid 
appellate review. Ante at 12.6 
I see several problems with this new method that make its results no more 
consistent and reviewable than the Wood-factors method that it aims to fine tune. 
First, I am not convinced that the starting point for this issue should be the 
4 Indeed, the Snapshot expressly “concerns . . . the ‘average’ attorney . . . 
with respect to . . . hourly billing rates . . . .” Snapshot at 5 of the survey report, 
located at:  (accessed June 9, 
2008). 
5 Under the lead opinion, it is unclear which “remaining factors” are usable 
in this adjustment calculation.  Recall that under Wood, any of the enumerated 
factors were usable, as well as any other relevant factors. Wood, supra at 588. 
Also, MRPC 1.5(a), which the lead opinion expressly incorporates, enumerates 
several factors that are distinct from the Wood factors. Thus, it is unclear whether 
the “remaining factors” usable for this adjustment are those from Wood, MPRC 
1.5(a), any other relevant factor, or all of the above.  If the majority aims to make 
appellate review of these questions more clear, this aspect of its new method is 
unsuccessful.   
6 It is illogical that a trial court would be required to articulate its analysis 
of the remaining factors that it found to be inapposite.  I would not require the trial 
court to state that it found a particular factor inapplicable, when simply not 
discussing that factor would suffice to convey that point. 
4  
 
 
 
 
 
 
 
 
 
                                              
customary fee in the locality, multiplied by the hours expended on the case.  While 
that figure is undoubtedly a valid factor in the reasonable-attorney-fee analysis, I 
disagree with the majority’s attempt to give that one factor inordinate emphasis by 
making it the baseline amount from which all adjustments must be made.  I note 
that this starting point method is very similar to the federal lodestar method, which 
begins its analysis by taking the reasonable hourly fee and multiplying it by the 
hours expended.  In Pennsylvania v Delaware Valley Citizens’ Council for Clean 
Air, 478 US 546, 564; 106 S Ct 3088; 92 L Ed 2d 439 (1986), the United States 
Supreme Court adopted the lodestar method and stated that the “starting point for 
determining the amount of a reasonable fee is the number of hours reasonably 
expended on the litigation multiplied by a reasonable hourly rate.”  But my 
inclination against such a starting-point method, or lodestar method, is neither 
novel nor contrary to the views of all members of this very Court.  Indeed, just 
eight years ago every justice in today’s majority joined the opinion per curiam in 
Dep’t of Transportation v Randolph, 461 Mich 757; 610 NW2d 893 (2000), in 
which we unequivocally stated that we “reject the . . . argument that the ‘lodestar’ 
method is the ‘preferred’ way of determining the reasonableness of requested 
attorney fees.” Id. at 766 n 11.  Thus, by fine tuning the Wood-factors method, the 
majority has effectively adopted some version of the lodestar method and 
overruled Randolph in part.7 
7 The majority attempts to distinguish Randolph so that it may implement 
(continued…) 
5  
 
 
 
 
                                              
 
 
 
 
To be clear, I am not opposed to giving the average fee equal weight in this 
multifactor reasonable fee analysis; but I am opposed to it playing a paramount 
role by being the starting point because the average fee does not represent the 
reality that a reasonable attorney fee under MCR 2.403(O) is not preliminarily 
(…continued) 
its new average-fee method (which is a modified version of the federal lodestar 
method that Randolph rejected) and claim that Randolph is not affected by today’s 
decision. While I agree that Randolph dealt with a different fee-shifting statute 
than the case-evaluation court rule at issue here, I note that the differences are 
irrelevant—at least with respect to the question of reasonableness.   
Indeed, the statute in Randolph, MCL 213.66(3), mandates that the fee 
question hinge on the reasonableness of plaintiff’s actual attorney fees, whereas 
the case-evaluation court rule only allows a reasonable attorney fee for the 
services the aggrieved party was forced to procure as a result of the other party’s 
rejection of case evaluation. In other words, this difference is only significant in 
the context that the fee analysis occurs: in MCL 213.66(3), the reasonableness of 
the fee actually charged is evaluated; and under the case-evaluation court rule, the 
reasonableness of the services necessitated is evaluated.  However, that difference 
does not change the main issue, which is reasonableness.  Indeed, the opinion per 
curiam in Randolph stated that “[i]nitially, the court must determine whether the 
‘owner’s’ attorney fees are ‘reasonable.’” Randolph, supra at 765. Further, in this 
reasonableness analysis, the Randolph Court went on to include the factors in 
MRPC 1.5(a), id. at 766, which are the very factors that the majority now adds to 
the case-evaluation fee analysis. Accordingly, despite the majority’s attempt to 
say otherwise, the reasonableness analysis from Randolph is not so unlike that in 
today’s case.  Additionally, Randolph expressly rejected any average-fee starting 
point. Thus, the majority cannot have it both ways.  Either the reasonableness 
analysis under either fee-shifting provision includes an average-fee starting point 
and Randolph is partially overruled, or Randolph’s holding precludes the 
majority’s new fine-tuned average-fee starting point because it expressly rejected 
such a method. 
6  
 
 
 
 
 
 
                                              
 
derived from an average attorney fee charged in a locality.8  This is evidenced in 
several respects. 
First, the reasonable attorney fee awarded under MCR 2.403(O) is 
retrospective in its analysis; whereas the average rate charged in a locality is 
prospective in its focus.  In other words, attorney fees awarded under MCR 
2.403(O) depend heavily on, among other things, what work was required because 
of the other party’s rejection of the case-evaluation award, the outcome of the 
case, and the skill that the outcome required—all of which depend on the trial’s 
outcome.  This stems from the text of the court rule, which expressly limits its 
award to “the opposing party’s actual costs . . . ,” MCR 2.403(O)(1) (emphasis 
added), which are defined as “a reasonable attorney fee based on a reasonable 
hourly or daily rate as determined by the trial judge for services necessitated by 
the rejection of the case evaluation.” MCR 2.403(O)(6)(b) (emphasis added). 
Accordingly, the reasonable attorney fee is what the trial court recognizes, after 
completion of the trial, as the reasonable value of that particular attorney’s service 
in that particular trial. This award is not necessarily what the client and his 
attorney agreed to as the fee, but it could be as high as the agreed-to amount.9 
8 While it is true that MCR 2.403(O)(6)(b) relies on the reasonable hourly 
rate, it nowhere mandates, or even references, a starting point that hinges on the 
average hourly rate. 
9 The majority accepts as much in stating that the rule “only permits an 
award of a reasonable fee, i.e., a fee similar to that customarily charged in the 
(continued…) 
7  
 
 
 
 
 
                                              
In contrast, the average rate charged in a locality, which the majority’s rule 
initially relies on, involves a prospective focus because it uses the fees on which 
the parties and their lawyers have agreed before the pending litigation.  Thus, 
while this average rate is a relevant factor in the reasonable-fee analysis, it should 
not be the starting point any more than any other relevant factor should be, 
because it does not share the retrospective focus that MCR 2.430(O) expressly 
requires. 
Also, the majority’s average-rate method wrongly assumes that the average 
rate exists for any given legal service performed.  While an average rate may exist 
for some repetitive or general legal services, it does not exist for the work 
conducted in prosecuting a claim through formal litigation, as is required in every 
case involving case-evaluation sanctions. In other words, every time a party 
imprudently rejects a case-evaluation award, the opposing party is forced to 
subject its claim to the slower, more expensive rigors of trial.10  And it is 
undisputed that no two trials are the same; thus, no two reasonable trial fees are 
the same. In essence, the majority rule asks us to accept the illogical premise that 
legal services provided at trial are like manufactured products that the consumer 
can take off a store’s shelf, each identical product being equally valuable.  But, 
(…continued)  
locality for similar legal services, which, of course, may differ from the actual fee  
charged . . . .” Ante at 8 (citations omitted).  
10 The majority acknowledges these purposes of MCR 2.403(O).  Ante at 8. 
8  
 
 
 
 
   
                                              
  
 
 
 
even within the very same attorney’s cases, the average billing rate does not 
necessarily equate to the reasonable value of the attorney’s performance at a given 
trial.11 
As noted earlier, this reality is exactly what the multifactor Wood method 
recognizes and the retrospective language of MCR 2.403(O) requires.  The 
majority’s starting-point rule does not recognize this and makes the illogical 
assumption that the average rate charged by similarly skilled advocates is 
presumptively reasonable, and only then adjustable for individual circumstances.  I 
would not start the analysis with the average attorney fee because that construct is 
not in accord with the language of the court rule or its purpose.12 
11 It is true that in the “real world” one must assume that the value of the 
attorney’s trial advocacy is the same from one trial to the next because attorneys 
do not set their fees after trial by adjusting them for the results delivered.  But, 
MCR 2.403(O) is not constrained to the pretrial analysis like the average fee is; 
the rule depends on the reasonable fee for the services that were necessitated by a 
party’s rejection of a case-evaluation award. 
12 I am also not persuaded by the majority’s unsupported intimations that 
the Wood factors have been applied inconsistently and that they need a fine-tuned 
starting point. Nor do I accept the majority’s new requirement that trial courts 
discuss each and every factor in order to make appellate review possible.  I note 
that the majority sees these very problems as inconsequential in other contexts. 
For instance, in Kreiner v Fischer, 471 Mich 109, 133-134; 683 NW2d 611 
(2004), the majority accepted a similarly subjective list of court-made, 
nonexclusive factors as giving acceptable guidance to a similar fact-intensive 
analysis. I dissented in Kreiner, but the majority in that case adopted a list of 
factors that, like the Wood factors, give no starting point, have led to seemingly 
disparate results, and have confounded appellate courts, as evidenced in this 
Court’s several peremptory reversals of the genuine attempts by the Court of 
Appeals to apply Kreiner’s amorphous factors. For the most recent examples of 
this reality see Jones v Olson, 480 Mich 1169 (2008), and Minter v Grand Rapids, 
(continued…) 
9  
 
 
 
 
 
 
 
 
 
 
                                              
 
 
Also, I question the majority’s assertion that the average attorney fee for a 
particular attorney’s services is easily ascertainable.  In conclusory fashion, the 
majority states that “[t]he reasonable hourly rate represents the fee customarily 
charged in the locality for similar legal services, which is reflected by the market 
rate for the attorney’s work.”  Ante at 12. But, contrary to the majority’s assertion, 
the market rate for an individual attorney’s work is not some figure that can be 
plucked from a reference manual or interpolated from a statistical graph.  The 
fallacy of such a proposition has been noted by the United States Supreme Court 
when, in a similar context, it stated: 
[D]etermining an appropriate “market rate” for the services of 
a lawyer is inherently difficult. Market prices of commodities and 
most services are determined by supply and demand.  In this 
traditional sense there is no such thing as a prevailing market rate for 
the service of lawyers in a particular community.  The type of 
services rendered by lawyers, as well as their experience, skill, and 
reputation, 
varies 
extensively—even 
within 
a 
law 
firm. 
Accordingly, the hourly rates of lawyers in private practice also vary 
widely. The fees charged often are based on the product of hours 
devoted to the representation multiplied by the lawyer’s customary 
rate. . . . Nevertheless . . . the critical inquiry in determining 
reasonableness is now generally recognized as the appropriate 
hourly rate. And the rates charged in private representations may 
afford relevant comparisons. [Blum v Stenson, 465 US 886, 895 n 
11; 104 S Ct 1541; 79 L Ed 2d 891 (1984).] 
I agree with the Court in Blum; the appropriate hourly rate is a valid inquiry, and 
assessing that rate should include comparisons with rates for similar services. 
(…continued)  
480 Mich 1181 (2008). It is not clear why the Kreiner-factors method is not  
flawed for the same reasons that the Wood method is held to be today.  
10  
 
 
 
 
 
 
 
    
                                              
And, like the Court in Blum, I recognize that the market rate for any given attorney 
is simply not an easily grasped number; thus, I disagree with the majority’s 
attempt to initially set the appropriate hourly rate at the average rate for attorneys 
in a particular locality. 
Nonetheless, assuming that such an average rate, or market rate, for a given 
attorney is easily ascertainable, the majority gives little guidance regarding how its 
new rule adds to what trial courts have already been using in evaluating reasonable 
attorney fees. The majority states that the average rate, or market rate, can be 
established by “testimony or empirical data found in surveys and other reliable 
reports.” Ante at 12. First, I note that, if the majority is insistent on finding the 
market rate, one of the best indicators of the market rate for a service is what a 
consumer agreed to pay for it, i.e., the hourly rate on which this particular attorney 
and his client agreed. I would not require an attorney and his client to give 
testimony to prove they agreed to a certain hourly fee when the court can deduce 
as much by simply looking at the billing documents, as the trial court did in this 
13
case.
Second, regarding empirical data and reliable reports, it is unclear what 
standard of admittance courts are to apply to such sources.  Apparently by way of 
13 Moreover, this testimonial requirement has no effect on this case because 
defendant expressly waived an evidentiary hearing on the fee issue when the trial 
court offered him one. 
11  
 
 
 
  
 
 
                                              
 
example, the majority points to the Snapshot survey conducted by the state bar.14 
While the state bar’s surveys are very useful in giving a broad picture of the 
financial status of the practice of law in Michigan, I would not cede our courts’ 
discretion in assessing reasonable attorney fees to surveys that derive their 
conclusions from voluntary submissions.  In fact, the survey was only sent to 25 
percent of the members of the Michigan bar.  What is more, only 20 percent of 
those surveys were returned. Thus, this “reliable” source is based on the responses 
of only 5 percent of the legal practitioners in this state. This is a stunningly low 
sample from which to assess the “fees customarily charged in the locality for 
similar legal services.” Ante at 12. Also, the survey’s ability to give average 
hourly fees in a particular locality is limited because in many of its localities it 
received only a small number of responses. For instance, in Muskegon County the 
hourly fee is based on a paltry four responses, which supposedly gives the average 
of all types of practices in that locality. In fact, in 12 of the 30 localities sampled, 
the survey reports less than 10 responses.15 
14 While the majority allows for reference to empirical data found in 
surveys and other reliable reports, it only directly endorses one such report.  It is 
unclear if there are other such acceptable reports, and what standard any other 
reports must meet to be admissible.  Not knowing the answers to those questions, I 
limit my analysis to the single source that the majority endorses as acceptable. 
15 I also note that this 2003 survey puts the hourly rate for the 95th 
percentile in the highest paying locality in Michigan at $440. 
12  
 
 
 
 
                                              
The majority also does not describe how the survey is to be used to 
determine the customary fee for similar legal services.  This lack of direction 
creates a problem in this case because the survey does not include a category for 
dental malpractice; in fact, it does not even include the broader category of 
medical malpractice. Accordingly, I question this survey’s ability to give any 
guidance beyond that already available to the trial court, especially regarding this 
case’s unique practitioner.16  In this regard, the majority concedes that its lone 
example of a reliable report is of small utility: “the benefit of such studies would 
be magnified by more specific data relevant to variations in locality, experience, 
and practice area.” Ante at 13. Nevertheless, the majority gives the lower courts 
no direction on how to use this survey while they wait for more specific surveys. 
I am also troubled by the ramifications of the majority’s rule because any 
practitioner who reads this opinion now realizes that his voluntary submissions to 
surveys are powerful enough to affect the future results of attorney-fee awards.  In 
other words, the majority unwittingly invites inflated survey submissions.  Further, 
I do not understand why the majority chooses a survey that was conducted over 
four years ago. Noting that the trial in this case occurred in December 2004, it is 
not clear why the 2003 version of this survey is preferable to a later version. 
16 It is undisputed that the plaintiff’s lead attorney is a specialist in the field 
of dental malpractice.  He has extensive experience in this state and around the 
country in this field. 
13  
 
 
 
 
 
 
                                              
Thus, while I have no qualms with trial courts using these types of surveys 
for broad guidance on this multifactor analysis, I would not elevate this survey as 
the lone representative of a reliable report that courts should use in beginning their 
reasonable fee analysis. 
The majority also does not define the scope of its new rule.  The majority 
has articulated a new rule for attorney-fee awards under MCR 2.403; yet, that new 
test’s application to other attorney-fee contexts is left for its readers to ponder. 
Indeed, the majority’s new test specifically incorporates the third factor under 
MRPC 1.5(a).17  Does this now mean that the third factor of MRPC 1.5(a) is the 
starting point for all proceedings under that provision of our ethical code?  Further, 
does this new rule apply to other fee-shifting provisions?  For example, does the 
majority’s test apply to the fee-shifting provisions of the Uniform Condemnation 
Procedures Act, MCL 213.66, and the Michigan Civil Rights Act, MCL 37.2802, 
each of which involves reasonable attorney fees?  And if today’s rule only applies 
to MCR 2.403, what is the basis for such a limited application of the new rule?  I 
would not forge ahead in the name of consistency and ease of appellate review 
while concomitantly creating these uncertainties in the wake. 
I also note that the majority mandates that the trial court decide whether it 
was reasonable for plaintiff to have two attorneys representing him at trial.  I am 
17 The third factor of the reasonableness analysis of MRPC 1.5(a) evaluates 
“the fee customarily charged in the locality for similar legal services.” 
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aware of no authority that casts doubt upon the reasonableness of a party’s 
decision to retain the services of multiple attorneys at trial.  In addition, if this 
multiple-attorney analysis is a new court-made factor in every reasonable-fee 
analysis, the majority should state as much.  See note 5, supra. It should also note 
if this element, like all earlier elements, must also always be discussed by the trial 
court. See note 6, supra. 
In the end, I can empathize with the majority in its desire to bring 
consistency to attorney-fee awards under MCR 2.403.  But that desire is 
inconsistent with the rule’s inherently subjective analysis; and, with that in mind, 
the majority has gone to great lengths while changing little.18  The instant case is a 
perfect example of this. It is probable that when this case returns to the trial court, 
under the majority’s new test, that court will use the Snapshot, find an average rate 
for the locality, and then adjust that rate to comport with its original award.  What 
is more, the trial court can support a reiteration of the fee award by simply 
restating its original rationale for its first award.  Thus, I would not expend such 
effort and make these changes to our current method because they add little to the 
18 If the majority is earnest in its proclamation that it can implement its new 
version of the lodestar method without affecting Randolph, supra, which expressly 
rejected such a method, it should pay heed to Randolph’s words regarding the 
consistency of attorney fee awards: 
[C]ourts can and will reach different decisions concerning 
reimbursement of attorney fees. However, that is the nature of 
discretionary decisions.  The key in each case is that the trial court 
provide a reasoned basis for its decision.  [Id. at 767-768.] 
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analysis while propagating the numerous questions I have noted.  Instead, I would 
do as courts have been doing for the 25 years since Wood: simply evaluate the 
several factors that guide a court in assessing “a reasonable attorney fee based on a 
reasonable hourly or daily rate as determined by the trial judge for services 
necessitated by the rejection of the case evaluation.”  MCR 2.403(O)(6)(b).19 
Simply put, this analysis cannot be molded into the mathematical precision 
that the majority seeks because, in the end, under either the Wood method or the 
majority’s fine-tuned method, a trial court still exercises its discretion in assessing 
the reasonable value of the services that a particular advocate delivered in a 
particular trial. Not all attorneys are created equal, and the reasonable attorney-fee 
awarded under MCR 2.403(O) should recognize as much.  Because the new 
method adopted by the majority does not reflect this as well as the Wood-factors 
method does, I respectfully dissent. 
Michael F. Cavanagh 
Elizabeth A. Weaver 
Marilyn Kelly 
19 The majority misunderstands me when it claims that my protestations are 
based on the proposition that “a ‘reasonable fee’ for an exceptional lawyer cannot 
be determined by using the fee charged by the average attorney.”  Ante at 16. This 
is not true. Again, my main contention is that the majority’s average-fee starting 
point gives inordinate weight to that factor, when the rule does not mandate such a 
starting point. I find that the Wood-factors method provides sufficient guidance. 
As simply as possible, my position is this: Wood is good. 
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