FILED

December 4, 1996

Cecil W. Crowson

Appellate Court Clerk

CYNTHIA ALBRIGHT, )

) Appeal No. 

Plaintiff/Appellee, ) 01A01-9607-CH-00333

)

v. )

) Chancery Court No.

JOSEPH L. MERCER, III, ) 23117

)

Defendant/Appellant. )

COURT APPEALS OF TENNESSEE

MIDDLE SECTION AT NASHVILLE

APPEAL FROM THE CHANCERY COURT FOR WILLIAMSON COUNTY

AT FRANKLIN, TENNESSEE

THE HONORABLE HENRY DENMARK BELL, JUDGE

KEITH JORDAN, ESQ.

227 Second Avenue North

Suite 360-M

Nashville, Tennessee 37201

ATTORNEY FOR DEFENDANT/APPELLANT

R. E. LEE DAVIES

Hartzog, Silva & Davies

123 Fifth Avenue North

P.O. Box 664

Franklin, Tennessee 37065-0664

ATTORNEY FOR PLAINTIFF/APPELLEE

AFFIRMED AND REMANDED

SAMUEL L. LEWIS, JUDGE
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Opinion

This is an appeal by defendant/appellant, Joseph L. Mercer,

III, from a decision of the Chancery Court for Williamson County

awarding plaintiff/appellee, Cynthia Albright, attorney's fees of

$1,000.00.

The underlying facts of this cases involve a rental agreement

between Mercer and Albright. Pursuant to the rental contract,

Mercer agreed to rent Albright's trailer for $450.00 per month from

1 December 1993 until 31 March 1994 and agreed to lease the trailer

on a month to month basis for $500.00 per month after 31 March

1994. The contract also provided that either party could terminate

the lease upon providing thirty days written notice after 28

February 1994. Finally, the contract provided that Mercer would

pay all reasonable attorney's fees incurred by Albright if Albright

instituted litigation for breach of contract. In a letter dated 19

December 1994, a paralegal, Tammy Krasnoff, informed Albright that

Mercer intended to vacate the trailer on 31 December 1994. The

letter also claimed that the clothes dryer destroyed $750.00 worth

of Mercer's clothing and requested Albright reimburse Mercer for

the loss.

The parties each filed separate actions. In January 1995,

Mercer filed an action in the General Sessions Court for Williamson

County. Mercer alleged that Albright's failure to maintain the

leased premises caused damage to his personal property. On 30

January 1995, Albright filed a complaint in the Chancery Court for

Williamson County. Albright alleged that Mercer breached the

contract by damaging walls, carpet, doorstops and jams, and other

items. Albright also alleged that Mercer failed to give her thirty

days written notice of his intention to vacate the trailer. Mercer

answered the complaint on 9 March 1995. He denied that he breached
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the contract and moved the court to dismiss the complaint.

Upon Albright's motion, the general sessions court removed

Mercer's case to the circuit court. On 30 May 1995, Mercer filed

a notice of jury demand. Thereafter upon Albright's motion, the

circuit court transferred Mercer's case to the chancery court and

consolidated it with Albright's case. In November 1995, Mercer

made an offer of judgment. Mercer agreed to pay Albright $750.00

in damages and to drop all claims or causes of action against

Albright. Albright refused the offer, and the parties conducted

limited discovery including the filing of interrogatories and

requests for admissions and for the production of documents.

Mercer waived his demand for a jury trial the day before the case

was set to be heard.

On 19 January 1996, the chancellor entered an order disposing

of the parties claims. As to the property damage, the chancellor

held that it was normal wear and tear and denied recovery of repair

costs. The court found that Mercer failed to provide thirty days

notice and awarded Albright damages of $500.00 pursuant to the

contract. The court then held that Mercer's claim was without

merit. Finally, the court awarded Albright attorney's fees and

agreed to set the amount if the parties could not reach an

agreement. On 5 January 1996, Albright's attorney filed an

affidavit claiming fees of $2,535.00. The total amount included

16.9 hours of professional services at $150.00 per hour.

The chancellor heard the parties' arguments as to attorney's

fees. On 1 February 1996, the chancellor entered an order awarding

Albright $1,000.00 in attorney's fees. Thereafter, Mercer filed a

notice of appeal questioning the reasonableness of the award of

attorney's fees.
4

The Tennessee Supreme Court addressed a similar issue in

Wilson Management Co. v. Star Distribs. Co., 745 S.W.2d 870 (Tenn.

1988). The court held:

[W]here an attorney's fee is based upon a contractual

agreement expressly providing for a reasonable fee, the

award must be based upon the guidelines by which a

reasonable fee is determined. The parties are entitled

to have their contract enforced according to its express

terms. Where they specify a reasonable fee rather than

a percentage of recovery, it is clear that they expect a

court to adjudicate the issue of a reasonable fee, unless

they agree upon the amount after a controversy matures.

Wilson, 745 S.W.2d at 873 (Fones, J.) (citations omitted). Later,

the court explained the holding in Wilson and stated: "This Court

held that where a 'reasonable' fee is called for, the award must be

based on the guidelines by which a reasonable fee is determined,

and not simply a percentage of recovery." Nutritional Support

Servs., Ltd. v. Taylor, 803 S.W.2d 213, 216 (Tenn. 1991) (Fones,

J.). DR 2-106 contains a list of the guidelines used to determine

whether a fee is reasonable.

 (A) A lawyer shall not enter into an agreement for,

charge, or collect an illegal or clearly excessive fee.

 (B) A fee is clearly excessive when, after a review of

the facts, a lawyer of ordinary prudence would be left

with a definite and firm conviction that the fee is in

excess of a reasonable fee. Factors to be considered as

guides in determining the reasonableness of a fee include

the following:

(1) The time and labor required, the novelty and

difficulty of the questions involved, and the skill

required 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.

(8) Whether the fee is fixed or contingent.

Sup. Ct. Rules, Rule 8, Code of Prof. Resp., DR 2-106(A)&(B) (West

1996); see Connors v. Connors, 594 S.W.2d 672, 676 (Tenn. 1980).

Mercer contends that the fee awarded by the chancellor, while
5

not clearly excessive, is not reasonable. During the proceedings

before the chancellor, Albright's attorney filed an affidavit

stating that he performed 16.9 hours of legal services in relation

to this case. In his brief, Albright's attorney submitted that

approximately 2.1 of these hours were spent defending Mercer's

claim. The contract only entitled Albright to recover fees for

claims instituted by her for breach of contract or for unlawful

detainer, not fees for defending a suit instituted by the lessee.

Thus, the trial court awarded Albright $1,000.00 for 14.8 hours of

legal services or approximately $68.00 per hour.

In support of his position, Mercer makes numerous arguments.

First, he points out that Albright only received $500.00 and that

the court denied the majority of the alleged damages. This

argument pertains to the fourth factor listed in DR 2-106(B).

Albright hoped to recover $1,350.00 for the damage to the property,

$500.00 for Mercer's failure to give proper notice, and reasonable

attorney's fees. Unfortunately for Albright, the court only

awarded the $500.00 for Mercer's failure to give proper notice and

$1,000.00 in attorney's fees. It is the opinion of this court that

the trial court's award of approximately $68.00 per hour is

reasonable given both the amount involved and the results obtained.

Mercer's second argument is that the fee awarded exceeds the

fee commonly charged in the locality for such actions. This

argument pertains to the third factor listed in DR 2-106(B). In

support of his argument, Mercer relies on the affidavit of another

attorney who stated that the appropriate and customary fee charged

in the locality was between twenty and twenty-five percent of the

amount collected. It is the opinion of this court that the

affidavit was not relevant to the issue which was before the trial

court. The affidavit speaks of a reasonable contingency fee, not

of a reasonable hourly rate. Absent the affidavit, there is no
6

evidence that the chancellor's award exceeded the fee customarily

charged in the locality. We will not disturb the chancellor's

finding on appeal absent a showing of an abuse of discretion.

Threadgill v. Threadgill, 740 S.W.2d 419, 426 (Tenn. App. 1987).

In addition, Mercer contends that the action was a simple

landlord/tenant dispute. This argument pertains to the first

factor listed in DR 2-106(B). It is the opinion of this court that

this argument is without merit. It is not unreasonable for an

attorney to charge at least $68.00 an hour in even the simplest of

cases.

Finally, Mercer argues that this court should consider the

fact that Mercer made an offer of judgment for $750.00 early in the

case and that Albright only recovered $500.00. It is the opinion

of this court that evidence of the offer of judgment is not

admissible as evidence of the reasonableness of attorney's fees.

Mercer made the offer of judgment pursuant to Rule 68 of the

Tennessee Rules of Civil Procedure. This rule provides: "An offer

not accepted shall be deemed withdrawn and evidence thereof is not

admissible except in a proceeding to determine costs." Tenn. R.

Civ. P. 68 (West 1996). The term "costs" as used in this rule does

not include attorney's fees. Person v. Fletcher, 582 S.W.2d 765,

766-67 (Tenn. App. 1979). Thus, evidence of the offer of judgment

is inadmissible.

It is the opinion of this court that the attorney's fees

awarded by the trial court were reasonable. Moreover, we are of

the opinion that the rental contract entitles Albright to an award

of attorney's fees on appeal. Therefore, it follows that the

decision of the chancery court is affirmed. The case is remanded

to the chancery court for a determination of the amount of

Albright's attorney's fees on appeal and for any further necessary
7

proceedings. Costs on appeal are taxed to defendant/appellant,

Joseph L. Mercer.

______________________________

SAMUEL L. LEWIS, JUDGE

CONCUR:

_______________________________

HENRY F. TODD, PRESIDING JUDGE,

MIDDLE SECTION

_______________________________

WILLIAM C. KOCH, JR., JUDGE