Case Title: Johnston v. Stephenson

Citation: 

Docket Number: 

State: wyoming

Court: Wyoming Supreme Court

Date: 1997-06-06T00:00:00Z

Document:
Johnston v. Stephenson1997 WY 70938 P.2d 861Case Number: 96-279Decided: 06/06/1997Supreme Court of Wyoming

H.R. JOHNSTON,

Appellant(Defendant), 

v. 

WILLIAM J. STEPHENSON, 

Appellee(Plaintiff).

Appeal from the District Court, Converse 
County

The Honorable Barton R. Voigt, 
Judge

Representing 
Appellant:

H.R. Johnston, Pro 
Se.

Representing 
Appellee:

Todd Hambrick of 
Krampner, Fuller & Hambrick, Casper.

Before TAYLOR, C.J., and THOMAS, MACY, 
GOLDEN and LEHMAN, JJ.

MACY, 
Justice.

[¶1]      Appellant H.R. 
Johnston appeals from the judgment which awarded attorney's fees to Appellee 
William J. Stephenson.

[¶2]      We 
affirm.

ISSUES

[¶3]      Johnston presents 
the following issues for our review: 

A. Did the District 
Court Judge abuse his discretion in awarding attorney fees to Appellee without 
evidence in the record of the reasonableness of the fees?

B. Has Appellee 
forfeited his right to attorney fees by failing to present evidence as to the 
reasonableness of attorney fees after having been given the opportunity to do 
so?

 

FACTS

[¶4]      On April 8, 1995, 
Johnston executed a noninterest bearing promissory note which was payable to 
Stephenson in the principal amount of $40,000. The promissory note provided that 
Johnston would pay "all costs and expenses of collection, including reasonable 
attorney's fees" in the event that he defaulted on the note. Johnston paid 
$25,000 pursuant to the terms of the promissory note, but he failed to make the 
last payment of $15,000 which was due on March 1, 1996.

[¶5]      Stephenson sued 
Johnston for the $15,000 and sought reasonable attorney's fees in an amount to 
be determined. Johnston did not file an answer, and Stephenson requested an 
entry of default, claiming $5,000 in attorney's fees - 33 1/3 percent of the 
gross recovery. A default judgment was entered against Johnston. Johnston 
objected to the amount of the attorney's fees which Stephenson had claimed, and 
he submitted an affidavit from an attorney who indicated that "customary and 
reasonable attorney fees" in a default situation should be no more than $500. 
Stephenson responded by submitting an affidavit from a Casper attorney who 
testified that 33 1/3 percent of the gross recovery of a debt was generally a 
reasonable attorney's fee and that this percentage was especially reasonable in 
this case given the facts. Stephenson also submitted an itemized bill for the 
attorney's fees which had been incurred.

[¶6]      After a hearing 
on the matter, the district court granted Stephenson's request for $5,000 in 
attorney's fees, finding that contingent fee arrangements were typical in this 
type of case and that 33 1/3 percent of the gross recovery of a debt was an 
appropriate attorney's fee.

[¶7]      Johnston filed a 
motion for reconsideration, relying on UNC Teton Exploration Drilling, Inc. 
v. Peyton, 774 P.2d 584 (Wyo. 1989), for the proposition that a contingent 
fee agreement is not per se reasonable. The district court granted 
Johnston's motion for reconsideration and asked the parties whether an 
additional hearing would be necessary. Stephenson informed the district court 
that all the essential evidence had already been presented for the determination 
of the reasonableness of the attorney's fees and that, therefore, an additional 
hearing would not be required. After reviewing the evidence before it, the 
district court reduced the award of attorney's fees to $1,732.35. Johnston 
appeals from that award.

STANDARD OF REVIEW

[¶8]      We review an 
award of attorney's fees under an abuse of discretion standard. State 
Department of Family Services, Division of Public Assistance and Social Services 
v. DDM, 877 P.2d 259, 262 (Wyo. 1994). A court abuses its discretion only 
when it acts in a manner which exceeds the bounds of reason under the 
circumstances. Goff v. Goff, 844 P.2d 1087, 1092 (Wyo. 1993). The burden 
is placed upon the party who is attacking the trial court's ruling to establish 
an abuse of discretion, and the ultimate issue is whether the court could 
reasonably conclude as it did. Id.

DISCUSSION

[¶9]      Johnston asserts 
that the district court abused its discretion in awarding attorney's fees to 
Stephenson because Stephenson failed to present evidence on the reasonableness 
of the claimed attorney's fees and he, therefore, forfeited his right to be 
awarded attorney's fees. Stephenson counters that the itemized bill, coupled 
with the expert affidavit testimony, supported the reasonableness of the award 
of attorney's fees.

Wyoming has adopted 
the federal "lodestar" test for the determination of the reasonableness of 
attorney fees. The lodestar test requires that two factors be considered: (1) 
whether the fee charged represents the product of reasonable hours times a 
reasonable rate; and (2) whether other factors of discretionary application 
should be considered to adjust the fee either upward or downward. The party who 
is seeking an award of fees has the burden of providing proof of the 
reasonableness of his fee. In order to meet that burden of proof, the claimant 
must present not only an itemized billing reflecting the time and the rate, but 
there must be evidence demonstrating that the fee was 
reasonable.

Hinckley v. Hinckley, 812 P.2d 907, 915 (Wyo. 1991) (citations omitted). 
WYO. STAT. § 1-14-126(b) (Supp. 1996) governs awards for attorney's fees and 
provides:

(b) In civil 
actions for which an award of attorney's fees is authorized, the court in its 
discretion may award reasonable attorney's fees to the prevailing party without 
requiring expert testimony. In exercising its discretion the court may consider 
the following factors:

(i) The time and 
labor required, the novelty and difficulty of the 
questions

involved, and the 
skill requisite to perform the legal service properly;

(ii) The likelihood 
that the acceptance of the particular employment precluded other employment by 
the lawyer;

(iii) The fee 
customarily charged in the locality for similar legal 
services;

(iv) The amount 
involved and the results obtained;

(v) The time 
limitations imposed by the client or by the circumstances;

(vi) The nature and 
length of the professional relationship with the client;

(vii) The 
experience, reputation and ability of the lawyer or lawyers performing the 
services; and

(viii) Whether the 
fee is fixed or contingent.

[¶10]   The promissory note required 
Johnston to pay all costs of collection including reasonable attorney's fees in 
the event that he defaulted on the note. Stephenson supplied the district court 
with an itemized statement for $3,122.35 in attorney's fees as well as expert 
affidavit testimony which expressed that $5,000 was a reasonable attorney's fee. 
The district court reviewed the itemized statement and adjusted the total by 
excluding charges which had not been proven to be reasonable, properly awarding 
$1,732.35 in attorney's fees to Stephenson.

[¶11]   
Affirmed.