# FILED
December 4, 1996 Cecil W. Crowson Ap pellate Cou rt 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 TENNE SSEE MIDDLE SECT ION AT NASH VILLE
APPEAL FROM

THE CHANCE RY COURT FO R WILLIAMSON COUNTY AT FRANKLIN , TENNESSEE
THE HONORAB LE HENRY DE NMARK 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. L EWIS, JUDGE2 

### Opinion
This is an appeal by defe ndant/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 betweenMercer 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
ona month to month basis for $500.00 per month after 31 March 1994. The contract also provided that either party could terminate the lea se upon providing thirty days written notice after 28 February1994. F inally , the contract provided that Mercer would payall reasonable attorney's fees incurred by Albright if Albright institutedlitigation for breach of contract. In a letter dated 19 December 1994, a paralegal, Tammy Krasnoff, informed Albright that Merce r intended to vacate the trailer on 31 December 1994 . Th e 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 fi led separate actions. In January 1995, Mercer filed an action in the General Sessions Court for Williamson County. Mercer alleged that Albright's fai lur e to maintain the leasedpremises caused damage to his personal property. On 30 January1995, Albright filed a complaint in the Chancery Court for WilliamsonCounty. 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 breached3

the contract and moved the court to dismiss the complaint.

UponAlbright's motion, th e 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 No vem ber 1995, Mercer made an offer of judgment. Mercer agreed to pay Albright $750.00 in damages a nd to drop all claims or causes of action against Albrig ht. A lbright refused the offer, and the parties conducted limi te ddiscovery including the filing of interrogatories and requests for admissions and for th e pr oduction of documents. Mercer waived his demand for a jury trial the day before the case was set to be heard.

On19 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 Albrig ht attorney's fees and agreedto set th e amount if the parties could not reach an agreement. On 5 January 1996, Albright's attorney filed an affidavit claimi ng fee s 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 appe al questioning the reasonableness of the award of attorney's fees.4

The Tennessee Supreme Court addressed a similar issue in WilsonManagement 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 aw ard 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 Wilsonand 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, andnot 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 f acts, a lawyer of ordinary prudence would be left witha 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 an d labor required, the novelty and difficultyof the questions i nv olved, 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 l ocality 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, while5

not clearly excessive, is not reasonable. During the proceedings before the chancellor, Albrigh t' 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 approximately2.1 of these h ours 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 argume nt per tains 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 att orney's fees. Unfortunately for Albright, the court on l y awardedthe $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 liste d in DR 2-106(B). In support of his argument, Mercer relies on the affidavit of another attorneywho statedthat the appropriate and customary fee charged in the locality was between twenty and twenty-five percent of the
am ount collected. It is the opinion of this court t hat th e affidavit was not relevant to the issue which was before the trial court. The affidavit speaks of a reasonable contingency fee, not
o f a reason able hourly rate. Absent the affidavit, there is no6

evidence that the chancellor's award exceeded the fee customarily chargedin 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).

Inaddition, Mercer contends that the action was a simple landlord/tenant dispute. This argument pertains to the first factor listed inDR 2-106(B). It is the opinion of this court that this argument is without merit. It is not unreasonable for an attorneyto 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 evi dence of the offer of judgment is not admissible as evidence of the reasonableness of atto rney's fees. Mercer made th e o ffer 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 awardedby the trial court were reasonable. Moreo ver, 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 onappeal and for any further necessary7

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