Title: McLain v. Anderson

State: wyoming

Issuer: Wyoming Supreme Court

Document:

McLain v. Anderson1997 WY 26933 P.2d 468Case Number: 96-21Decided: 02/19/1997Supreme Court of Wyoming

Dorothy 
M. MCLAIN; Margo L. Nelsen; and David A. Nelsen, Appellants

(Plaintiffs),

v.

Jerry A. ANDERSON and Faith K. Anderson, Husband and 
Wife, Appellees (Defendants).

  

 

Appeal from The District Court, 
Sheridan County, John C. Brackley, J.

 

Brian N. Beisher of Hart & Reiter, Sheridan, 
for Appellants.

 Micheal K. Shoumaker of Northern Wyoming Law 
Associates, Sheridan, for Appellees.

 

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

 

THOMAS, 
Justice.

 [¶1]      Dorothy M. 
McLain, Margo L. Nelsen, and David A. Nelsen, some of the neighbors (neighbors) 
of Jerry A. Anderson and Faith K. Anderson (Andersons), instituted this action 
to enjoin claimed violations of certain restrictive covenants attached to a 
rural subdivision. They also sought to recover a $25.00 per day penalty together 
with attorney fees. Both attorney fees and the continuing penalty are provided 
for in the covenants. The neighbors assert that the trial court erred in 
construing the term "residence" as being a "lot" in the paragraph of the 
covenants relating to keeping livestock. In addition, the neighbors assert error 
on the part of the trial court in denying them attorney fees and the $25.00 per 
day penalty in connection with their claims against the Andersons. We hold that 
any error on the part of the trial court in its ruling that the developer 
intended the covenant relating to livestock to relate to a lot and not a 
residence that might exist on several lots has become moot because of an 
amendment of the covenants. We hold that there was no abuse of discretion in 
refusing attorney fees to the neighbors in this case, and the provision for a 
continuing penalty was a cumulative and discretionary sanction provided for the 
benefit of the collective landowners through the Architectural Committee. It was 
not intended to benefit individual owners who sought enforcement of the 
covenants. The Judgment entered in the trial court is 
affirmed.

 

[¶2]      The Brief of 
Appellants, filed by the neighbors, states the issues as 
follows:

 

A. Whether the District Court abused its discretion 
and ruled contrary to law by interpreting the term "residence" to mean "lot" as 
such term is used in the Restrictive Covenants of the Sherri View Subdivision, 
Article II, section 14.

 

B. Whether the District Court abused its discretion 
and ruled contrary to law in refusing to allow Appellants to recover from 
Appellees the attorney's fees and costs incurred by Appellants in bringing the 
action to compel Appellees to conform to the Restrictive Covenants of the Sherri 
View Subdivision.

 

C. Whether the district court abused its discretion 
and was in error when it ignored Appellants' request by not taxing and giving no 
reason for not taxing Appellees twenty five dollars ($25.00) per day from the 
date of notice to them that they were in violation of the Restrictive Covenants 
of the Sherri View Subdivision.

 

The Andersons, in their 
Brief of Appellees, respond by stating these issues:

 

1. The Judge did not err in interpreting the term 
"residence" to mean "lot" as used in Article II, Section 14 of the 
Covenants.

 

2. The District Court did not err by refusing to 
grant attorney fees.

 

Without raising further 
issues, a reply brief of the neighbors addresses the arguments raised in the 
Andersons' brief by a lengthy itemization of those arguments as perceived by the 
neighbors.1 

 

[¶3]      The parties to 
this case own lots in the Sherri View Subdivision in Sheridan. The lots in the 
subdivision are subject to restrictive covenants that have been amended or 
restated at least four times since they were initiated on June 20, 1979. The 
last amendment occurred subsequent to the entry of the judgment of the trial 
court in this case.

 

[¶4]      The restrictive 
covenants in effect at the time this action was commenced, established an 
Architectural Committee composed of the Declarants of the restrictive covenants 
or their successors and assigns. To the Architectural Committee was delegated 
"all discretionary control over design, construction, maintenance and all other 
matters as set forth more particularly in these Covenants."  On October 13, 1994, Margo Nelsen, on 
behalf of the Architectural Committee served notice on Faith Anderson that the 
Andersons' use of their lots was in violation of the restrictive covenants.2 About a month and a half later, the 
neighbors brought this action to enforce the restrictive covenants, alleging 
that the Andersons had refused to correct the violations of which they had been 
notified.

 

[¶5]      In its Judgment 
entered after trial, the district court relied upon covenants that it concluded 
were ratified after an amendment in October 1995. It noted that the evidence 
indicated covenant violations may exist on the lands of non-parties to the 
action, and the Architectural Committee had not strictly enforced the covenants. 
The court did recognize the standing of the neighbors to bring the action, and 
it ruled that the term "residence" should be construed to mean "lot" in so far 
as it related to the keeping of livestock. The court held that the Andersons had 
not violated a covenant by keeping two horses per lot on their property. The 
court did find, however, that the Andersons had violated several other 
covenants, such as maintaining an excess amount of trash on their property and 
not parking their trailers and a camper in a prepared 
location.

 

[¶6]      The relief 
afforded by the district court enjoined the keeping of more than two horses at a 
time on any subdivision lot; required the Andersons to remove or provide 
covenant approved covered storage for specified items that it had held were kept 
outside of the Anderson's buildings in violation of Article II, Sections (XII) 
and (XV) of the covenants; required the Andersons to correct the violations 
within forty-five (45) days, making their failure subject to damages at the rate 
of twenty-five (25) dollars per day; required the Andersons to park their 
trailer and camper in accordance with the covenants; and made each of the 
parties responsible for their own attorney's fees. In its Judgment, the district 
court did not award attorney's fees to the neighbors nor did it impose damages 
at the twenty-five (25) dollars per day rate authorized by the 
covenants.

 

[¶7]      The neighbors 
claim that the trial court erred in construing "residence" to mean "lot" in the 
covenant relating to the keeping of livestock. The pertinent language of Article 
II, paragraph (XIV) (emphasis added) stated:

 

No birds, dogs, pets, animals or livestock of any 
kind shall be kept, raised or cared for on a commercial basis within the 
subdivision.  No swine, cattle, 
sheep, goats, or other livestock shall be permitted to be kept within the 
subdivision except that up to two horses per residence may be kept if 
adequate supplemental feed is provided to prevent overgrazing and erosion or 
related problems, and express consent of the Architectural Committee is first 
obtained.

 

Subsequent to the entry of 
the Judgment, it appears that the owners of property in the subdivision amended 
the covenant language.3  As amended, Article II, paragraph (XIV) 
(emphasis added) reads:

 

Birds, dogs, pets, animals, or livestock kept as 
outside pets may be raised and kept except on a commercial basis within the 
subdivision EXCEPT that only two (2) horses per lot OR two (2) cows per lot 
OR six (6) goats per lot OR six (6) sheep per lot OR an acceptable combination 
of the above NOT to exceed six (6) total animals may be 
kept.

 

[¶8]      Our rule is that 
we dismiss a case if, during the pendency of an appeal, an event occurs that 
causes the case to become moot or makes a determination of the issues 
unnecessary. Van Riper v. State, 882 P.2d 230, 238 (Wyo. 1994); Davidson v. 
Sherman, 848 P.2d 1341, 1348 (Wyo. 1993). We do not decide cases or issues when 
the decision cannot be given effect or simply pertains to matters that might 
arise in the future. Foster v. Wicklund, 778 P.2d 118, 122 (Wyo. 1989); Gulf Oil 
Corp. v. Wyoming Oil and Gas Conservation Com'n, 693 P.2d 227, 233 (Wyo. 1985). 
When the determination of a matter is sought which, if provided, cannot have any 
practical effect on the existing controversy, the case is moot. Rocky Mountain 
Helicopters, Inc. v. Air Freight, Inc., 773 P.2d 911, 924 (Wyo. 1989). Because 
the residents of the Sherri View Subdivision have adjusted the covenants so that 
they conform with the Judgment of the trial court, expressly providing that each 
resident may have up to two horses per lot, that issue in this case is 
moot.

 

[¶9]      The second claim 
of error by the neighbors is that the trial court abused its discretion in 
refusing to award attorney's fees, after holding that the Andersons had violated 
some of the restrictive covenants relating to the subdivision. The pertinent 
language in Article VI of the restrictive covenants reads:

 

In the event suit is required to collect any sums 
due, or to enjoin the violation of any of the covenants contained herein, 
violator, in addition to any of the other penalties provided herein or which may 
be assessed by a Court, shall be liable for all attorney's fees and costs 
incurred by Owner or its successor in bringing such 
action.

 

[¶10]   We follow the American rule that 
each party in a lawsuit bears its own attorney's fees in the absence of an 
expressed contractual or statutory provision for attorney's fees. Snodgrass v. 
Rissler & McMurry Co., 903 P.2d 1015, 1017 (Wyo. 1995). UNC Teton 
Exploration Drilling, Inc. v. Peyton, 774 P.2d 584, 594 (Wyo. 1989). Pursuant to 
this rule it is generally recognized that attorney's fees cannot be recovered in 
the absence of specific statutory authority or a specific contract provision. 
Snodgrass, 903 P.2d  at 1017; UNC Teton, 774 P.2d  at 594; DeWitt v. Balben, 718 P.2d 854, 863 (Wyo. 1986). The quoted language of the restrictive covenants does 
provide contractual authority to award attorney's fees to the 
neighbors.

 

[¶11]   While appropriate contractual 
authorization to award attorney's fees is present, we also must determine 
whether a proper basis exists in the record for an award of attorney's fees. The 
requisite demonstration cannot be a mystery to any of our legal 
practitioners.

 

Wyoming has adopted the federal "lodestar" test for 
the determination of the reasonableness of attorney fees. UNC Teton Exploration 
Drilling, Inc. v. Peyton, 774 P.2d 584 (Wyo. 1989). See Stanbury v. Larsen, 803 P.2d 349 (Wyo. 1990). 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. UNC Teton, 774 P.2d  at 595. The party who is seeking an award of fees has the burden of 
providing proof of the reasonableness of his fee. See Miles v. CEC Homes, Inc., 
753 P.2d 1021 (Wyo. 1988); Jones Land & Livestock v. Federal Land Bank, 733 P.2d 258 (Wyo. 1987). 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. UNC Teton. In this 
case, there was no testimony or other evidence presented with respect to the 
reasonableness of the attorney fees that were charged. We must reverse the award 
of attorney fees as an abuse of discretion by the trial court in light of the 
applicable rule of law.

 

Hinckley v. Hinckley, 812 P.2d 907, 915 (Wyo. 1991). Pekas v. Thompson, 903 P.2d 532, 536 (Wyo. 1995). See 
also, Kidd v. Kidd, 832 P.2d 566, 572 (Wyo. 1992); Greenough v. Prairie Dog 
Ranch, Inc., 531 P.2d 499, 503 (Wyo. 1975).

 

[¶12]   In UNC Teton Exploration Drilling, 
we specifically adopted the federal lodestar test for determining the 
reasonableness of attorney's fees. UNC Teton Exploration Drilling, 774 P.2d  at 
594. The party seeking the award of attorney's fees must demonstrate: (1) the 
fee charged represents the product of reasonable hours times reasonable rates; 
(2) whether other factors of discretionary application should be considered to 
adjust the fee either upward or downward. Pekas, 903 P.2d  at 536. The rationale 
for this rule is that attorney's fees are a variety of punitive damages and must 
be proven to have been incurred and to be reasonable in amount in order to be 
awarded. UNC Teton Exploration Drilling, 774 P.2d  at 594.

 

[¶13]   The record in this case includes an 
affidavit reflecting costs and attorney's fees. There is nothing in the record 
to demonstrate the reasonableness of the fees in accordance with our cases. The 
neighbors simply failed to establish the reasonableness of the itemized billing 
as they were required to do. Consequently there was no abuse of discretion on 
the part of the trial court in refusing to award attorney's 
fees.

 

[¶14]   Our practice has been to remand a 
case to permit additional proof of attorney's fees only in those instances in 
which the party was denied an opportunity to establish the fees in the court 
below. Pekas, 903 P.2d  at 537. The neighbors had an adequate opportunity to 
establish the reasonableness of their attorney's fees, and we do not in those 
circumstances remand to permit them to have another opportunity. Pekas, 903 P.2d  
at 537, quoting, Downing v. Stiles, 635 P.2d 808, 817 (Wyo. 1981). It would not 
be fair to the Andersons to afford the neighbors another opportunity to prove 
the reasonableness of their attorney's fees in this case. UNC Teton Exploration 
Drilling, 774 P.2d  at 596 n. 8.

 

[¶15]   In their last assertion of error, 
the neighbors contend that the trial court committed an abuse of discretion in 
not awarding them a twenty-five (25) dollars per day penalty based upon the 
violations of the restrictive covenants by the Andersons. Article VI (emphasis 
added) of the restrictive covenants provides in this 
regard:

 

(A) Enforcement. Declarant and its successors and 
assigns shall have the sole and exclusive right and authority to enforce 
compliance with the covenants contained herein. Upon the violation of any 
covenant, or upon the failure to pay any assessments, a written notice of such 
violation or failure shall be directed to the violator who shall then have 
forty-five (45) days after receipt of the said notice to correct the violation 
or pay the assessment due. If said violation is not so corrected or payment is 
not made, Declarant or its successors or assigns, may re-enter and take 
possession of the violator's premises and correct the violation and charge all 
costs of such correction to the Owner. In addition, damages may be assessed 
against the violator at the rate of twenty-five dollars ($25.00) per day for 
each day the violation continues after the forty-five (45) day 
notice.

 

The neighbors argue that, 
because the trial court found the Andersons were in violation of the restrictive 
covenants, it should have assessed the twenty-five (25) dollars per day penalty 
from the time Margo Nelsen, acting for the Architectural Control Committee, 
notified Faith Anderson of the covenant violations. It is clear from the 
language of the enforcement provision that this provision is cumulative to other 
remedies, and the use of "may" makes such damages available only at the 
discretion of the trial court. For this reason, the trial court did not abuse 
its discretion in refusing to award the twenty-five (25) dollars per day penalty 
to the neighbors.

 

[¶16]   Furthermore, "Declarant" is defined 
in Article I as follows:

 

(A) Declarant. Declarant means Sherri View 
Subdivision, acting through its architectural control 
committee.

 

Because they are contractual 
in nature, restrictive covenants are to be interpreted in accordance with the 
principles of contract law.  
Anderson v. Bommer, 926 P.2d 959, (Wyo. 1996). We construe plain terms of 
a covenant, if they are sufficiently clear, without reference to any attendant 
facts and circumstances or extrinsic evidence. American Holidays, Inc. v. 
Foxtail Owners Ass'n, 821 P.2d 577, 579 (Wyo. 1991); Klutznick v. Thulin, 814 P.2d 1267, 1270 (Wyo. 1991); Knadler v. Adams, 661 P.2d 1052, 1053 (Wyo. 
1983).  In this instance, the plain 
meaning of the restrictive covenant is that the "Declarant and its successors 
and assigns shall have the sole exclusive right and authority to enforce 
compliance with the covenants." The Declarant is the Sherri View Subdivision 
acting through the Architectural Control Committee. There is no evidence in the 
record of an assignment of the right to recover damages from the Declarant to 
the individual property owners. It follows that the provision for a continuing 
penalty was retained for the benefit of the collective land owners acting 
through the Architectural Control Committee. It was not intended be available to 
benefit individual owners who sought enforcement of the 
covenant.

 

[¶17]   We hold that the claim of error 
with respect to the construction of the restrictive covenants by substituting 
"lot" for "residence" is moot. There was no abuse of discretion on the part of 
the trial court with respect to the other claims of error. The Judgment is 
affirmed.

 

FOOTNOTES

1 In the 
Reply Brief of Appellants, the neighbors claim to have captured the arguments 
presented in the Brief of Appellees by restating them as:

 

A. 
Appellees contend Appellants brought suit against the Appellees and no other lot 
owner.

 

B. 
Appellees argue Appellants' action is barred due to the theories of waiver and 
acquiescence, and possibly laches and estoppel.

 

C. 
Appellees assert that their covenant violations are not actionable due to 
changed circumstances in the neighborhood whereby other lot owners are violating 
the same or similar covenants.

 

D. 
Appellees allege that their covenant violations were "grandfathered" and they 
were given permission to violate the covenants with regard to their four 
horses.

 

E. 
Appellees vaguely allude to the garage/residence structure located on 
Appellants', Dave and Margo Nelsen's, property as a possible violation of the 
covenants.

 

F. 
Appellees raise a number of issues with regard to Appellants' request for the 
recovery of attorneys fees, and Appellants believe Appellees' argument is as 
follows:

 

1. The 
trial court determined the award of attorney's fees and costs to Appellants was 
unwarranted due to the circumstances of the case, and Appellees allege it is 
within the trial court's purview to so decide based on the trial court's 
authority to assess the reasonableness of attorney's fees and 
costs;

 

2. 
Appellees contend the submission of the amount and breakdown of Appellants' 
attorney's fees and costs was improper and allowed Appellees no opportunity to 
object;

 

3. 
Appellees argue it would be proper to apportion the attorney's fees and costs 
incurred based on:

 

a. The 
Jackson's withdrawal as a party; and

 

b. The 
number of covenant violations found.

 

G. 
Appellees contend that Appellants should not be able to avail themselves of the 
penalty provision found in the covenants.

  

2 In 
particular, the Andersons were notified that they violated the restrictive 
covenants in that they had an excess amount of trash on the lots; they had too 
many horses and a barking dog at their residence; they had erected a fence on 
the property without the permission of their neighbors; they had an unregistered 
vehicle on one lot; they had a camper on their property in excess of four days: 
and they had erected a shed in direct violation of the 
covenants.

  

3 In the 
Brief of Appellees, the Andersons assert that the language of this paragraph of 
the covenants was changed after the entry of Judgment. The record does not 
clearly demonstrate that the amendments in fact were ratified. The neighbors in 
the Reply Brief of Appellants do not dispute the claim of amendments by the 
Andersons. We assume that the draft amendments that were injected into the 
record have been appropriately ratified by the requisite number of property 
owners in Sherri View Subdivision.