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Nature of Suit Code: 190
Nature of Suit: Other Contract Actions
Cause of Action: 

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.. UNITED STATES COURT OF APPEALS 

FOR THE TENTH CIRCUIT 

BARRIE M. HUTCHINSON, 

Plaintiff-Appellant, 

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FI LED 

United States Courc of Appn» 

Tenth Cirruir 

JAN 2 5 1991 

ROBERT L. HOECKER 

Clerk 

v. ) Nos. 89-6218 

) (D.C. No. 87-1035-T) 

HORIZON HEALTHCARE, a Tennessee 

general partnership; RAYMOND B. 

PEIRCE, JR., individually and as 

) (W.D. Okla.) 

a general partner; CENTURY HEALTH 

CORPORATION, a Tennessee corporation, 

as a general partner; JEFFREY 

CHAMBERLAIN, as a general partner; 

THEADORE CHAMBERLAIN, as a general 

partner; J & L, INC., an Oregon 

corporation as a general partner, 

Defendants-Appellees. 

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ORDER AND JUDGMENT* 

Before MOORE, BARRETT, Circuit Judges, and SPARR,** District 

Judge. 

**Honorable Daniel 

District Court for 

designation. 

B. Sparr, District Judge, 

the District of Colorado, 

United States 

sitting by 

After examining the briefs and appellate record, this panel 

has determined unanimously that oral argument would not materially 

* This order and judgment has no precedential value and shall 

not be cited, or used by any court within the Tenth Circuit, 

except for purposes of establishing the doctrines of the law of 

the case, res judicata, or collateral estoppel. 10th Cir. R. 

36.3. 

Appellate Case: 89-6218 Document: 010110080421 Date Filed: 01/25/1991 Page: 1 
assist the determination of this appeal. See Fed. R. App. P. 

34(a); 10th Cir. R. 34.1.9. 

submitted without oral argument. 

The case is therefore ordered 

Plaintiff appeals the district court's denial of his claim 

for attorney's fees under Okla. Stat. tit. 12, S 936 (1988). 1 In 

addition, plaintiff appeals the district court's determination 

that any prejudgment interest owing under Okla. Stat. tit. 23, S 6 

and Okla. Stat. tit. 23, S 22, was included in the arbitration 

award. 

Questions of law are considered by the appellate court de 

IlQYQ. The standards governing the appellate court's review of the 

record under these circumstances are the same as those which would 

be applied by the trial court in making its initial ruling. See 

United States v. Ortiz, 804 F.2d 1161, 1164 (10th Cir. 1986); 

Boise City Farmers Co-op. v. Palmer, 780 F.2d 860, 866 (10th Cir. 

1985). 

Although the appropriateness of the arbitrators' decision and 

award are not before the court on appeal, a recitation of the 

facts of the case is necessary in order to determine if the 

situation is embraced by the applicable statutes and if the 

district court's denial of plaintiff's requests is correct. The 

plaintiff in this case entered into a written agency agreement 

1 Section 936 provides: 

In any civil action to recover .•• for labor or 

services, unless otherwise provided by law or the 

contract which is the subject of the action, the 

prevailing party shall be allowed a reasonable attorney 

fee to be set by the court, to be taxed and collected as 

costs. 

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with Hillhaven Corporation, an entity engaged in owning and 

operating nursing homes. Plaintiff's agreement called for him to 

locate and provide information on nursing homes which Hillhaven 

might . be interested in acquiring. In the event a sale was 

completed, plaintiff was to receive a percentage of the purchase 

price as coDDnission. Plaintiff presented three suitably 

purchasable properties to Hillhaven and put the principals in 

direct contact. The record indicates that the purchase of the 

properties did not materialize due to an inability on the part of 

Hillhaven to secure the necessary state licensing to operate the 

nursing homes. Plaintiff's main contact person with Hillhaven 

from the beginning was Ray Peirce, Hillhaven's vice president. 

When it appeared certain Hillhaven would not be able to purchase 

the nursing homes, Ray Peirce created an outside partnership, 

Horizon Healthcare, which was able to complete the purchase of all 

three properties. Plaintiff alleges that Ray Peirce verbally 

assured him that even though one of the main players had been 

substituted, plaintiff would be compensated for his efforts. It 

appears the other members of the partnership did not concur with 

Peirce's assurance and consequently Horizon Healthcare disavowed 

any obligation to plaintiff and refused any payment. Plaintiff 

filed suit and the dispute was submitted to arbitration resulting 

in an award in favor of plaintiff of $100,000. By stipulation, 

the parties waived their right to appeal the arbitration decision 

and the award was entered as a judgment. Plaintiff subsequently 

applied to the court for an award of attorney's fees pursuant to 

Okla. Stat. tit. 12, S 936 and for the addition of prejudgment 

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interest pursuant to Okla. Stat. tit. 23, S 6 and Okla. Stat. tit. 

23, S 22. The district court denied plaintiff's request for 

attorney's fees and held that he had already been awarded 

prejudgment interest as part of the arbitration award. It is 

these decisions that plaintiff appeals. For the reasons that 

follow, we find that the district court's order was inconsistent 

with the applicable statutory law of the State of Oklahoma. 

Oklahoma law has long favored the "American Rule" when 

determining the issue of attorney's fees. Under the "American 

Rule," attorney's fees are not ordinarily allowed unless their 

recovery is authorized by statute or contract. City Nat'l Bank & 

Trust Co. v. Owens, 565 P.2d 4, 7 (Okla. 1977); see also Smith v. 

State ex rel. Dep't of Human Servs., 788 P.2d 959, 961 (Okla. 

1990); Hall v. Edge, 782 P.2d 122, 129 (Okla. 1989); McCracken v. 

City of Lawton, 648 P.2d 18, 20 (Okla. 1982). 

This court has previously upheld the right, under Oklahoma 

law, of a real estate broker to receive attorney's fees in an 

action to recover a commission. Fulton v. L & N Consultants, 

Inc., 715 F.2d 1413 (10th Cir. 1982). The district court did not 

consider Fulton, but instead relied on ABC Coating Co. v. J. 

Harris & Sons, Ltd., 747 P.2d 271 (Okla. 1987), in finding 

plaintiff's action to be outside the statutory authority. We 

disagree with the district court's construction. ABC Coating Co. 

was an action claiming misappropriation of a trade secret. 

Although we would agree with the Oklahoma Supreme Court that the 

labor and services rendered in ABC Coating Co. were collateral to 

the underlying action, we find that the underlying action in this 

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case is directly related to defendants' failure to pay for labor 

and services performed by plaintiff. "If recovery is sought for 

labor and services, as in the case of a failure to pay for them, 

the statute applies." 

(Okla. 1987). 

Holbert v. Echeverria, 744 P.2d 960, 966 

The Oklahoma Supreme Court in ABC Coating Co. v. J. Harris & 

Sons. Ltd., 747 P.2d at 273 stated 

••• in each case it is the underlying nature of the 

suit itself which determines the applicability of the 

labor or services provision of S 936. The question is 

whether the damages arose directly from the providing of 

labor or services, such as the failure to pay for those 

services, or from an aspect collaterally relating to 

labor or services. 

Defendants argue that plaintiff's services were rendered on 

behalf of Hillhaven and that he performed no services for them. 

We find this argument unpersuasive. The record indicates that 

defendants would not have been afforded the opportunity to 

purchase these properties without the good-faith efforts of 

plaintiff. The arbit~ation panel obviously concurred as evidenced 

by the award. We therefore hold that the plaintiff's action is 

embraced by Okla. Stat. tit. 12, S 936 (1988) as an action to 

recover for labor or services. 

Plaintiff further appeals the district court's conclusion 

that prejudgment interest was included in the arbitration award. 

The law of the forum state governs the availability of prejudgment 

interest in a diversity action. Kinsella v. Leonard, 415 F.2d 

574, 578 (10th Cir. 1969)(on petition for rehearing). Plaintiff 

claims prejudgment interest under two Oklahoma statutes, Okla. 

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Stat. tit. 23, S 62 and Okla. Stat. tit. 23, S 22 3 . Plaintiff's 

entitlement to prejudgment interest is not at issue on appeal and 

therefore we do not address the relative applicability of the 

respec~ive statutes. 

The district court determined that the issue of prejudgment 

interest had been submitted to the arbitrators and because the 

arbitrators did not specifically reserve the issue to the district 

court, it must be presumed that the panel included a prejudgment 

interest amount in its award of $100,000. The district court 

supported its decision with a previously stated rule in Roussel v. 

Russell, 339 P.2d 522, 529 (Okla. 1959). 

The judgment of the court must follow the verdict, and 

where the verdict is general and for a sum in gross, and 

the question of interest was not reserved by the court, 

and there is nothing in the record to indicate that the 

jury omitted interest, it will be presumed that it is 

embraced in the amount of their finding, and the court 

cannot add interest to the amount found by verdict of 

the jury. 

(Citation omitted.) 

Quoting St. Louis, E.R. & W.R. Co. v. Oliver, 87 P. 423, 427 

(Okla. 1906), the Roussel court went on to say that the court may 

2 

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Section 6 provides: 

Any person who is entitled to recover damages certain, 

or capable of being made certain by calculations, and 

the right to recover which is vested in him upon a 

particular day, is entitled also to recover interest 

thereon from that day except during such time as the 

debtor is prevented by law, or by the act of the 

creditor from paying the debt. 

Section 22 provides: 

The detriment caused by the breach of an obligation to 

pay money only is deemed to be the amount due by the 

terms of the obligation, with interest thereon. 

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calculate and add interest where it is "clearly apparent. 

that the jury did not include interest." Roussel v. 

Russell, 339 P.2d at 529. Such a certainty as to the intent of 

the arbitrators in this case is not indicated in the record. They 

neither denoted its inclusion in the award or specifically 

reserved it to the district court. We conclude these omissions 

create an ambiguity which can only be clarified by an indication 

of the intent of the arbitration panel. We therefore remand the 

issue of prejudgment interest for action in accordance with this 

order and judgment. In the event it is determined that 

prejudgment interest was not included in the arbitration award, we 

direct that a correct interest amount be calculated and added to 

plaintiff's judgment. 

The judgment of the trial court denying plaintiff his 

reasonable attorney's fees is reversed and remanded for an 

appropriate award of attorney's fees and costs including 

reasonable attorney's fees and costs for services rendered in 

bringing this appeal. 

REVERSED and REMANDED. 

ENTERED FOR THE COURT 

PER CURIAM 

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