Case Name: Catherine Ann GOFF, v. JOHN HANCOCK MUTUAL LIFE INSURANCE COMPANY, et al.
Court: Louisiana Court of Appeal
Jurisdiction: Louisiana
Decision Date: 1986-11-05
Citations: 497 So. 2d 747
Docket Number: No. 85-957
Parties: Catherine Ann GOFF, v. JOHN HANCOCK MUTUAL LIFE INSURANCE COMPANY, et al.
Judges: Before DOMENGEAUX, GUIDRY, FOR-ET, YELVERTON and KING, JJ.
Reporter: Southern Reporter, Second Series
Volume: 497
Pages: 747–753

Head Matter:
Catherine Ann GOFF, v. JOHN HANCOCK MUTUAL LIFE INSURANCE COMPANY, et al.
No. 85-957.
Court of Appeal of Louisiana, Third Circuit.
Nov. 5, 1986.
Rehearing Denied Dec. 9, 1986.
Roy and Hattan, M. Candice Hattan, Lafayette, for plaintiff-appellant.
Yoorhies and Labbe, Robert Ellender and Thomas Hightower, Jr., Lafayette, Davidson, Meaux, John G. Swift, Lafayette, Son-nier and Hebert, Paul J. Hebert, Abbeville, Grace Powers Monaco, White, Fine and Verville, Washington, D.C., Cliffe E. La-borde and Elizabeth O’Brien, Lafayette, for defendants-appellees.
Before DOMENGEAUX, GUIDRY, FOR-ET, YELVERTON and KING, JJ.

Opinion:
GUIDRY, Judge.
This case arose when defendants denied plaintiff's claims for medical insurance benefits. From a judgment in favor of plaintiff, Catherine Ann Goff, and against defendants, Reliance Insurance Company and John Hancock Mutual Life Insurance Company, this appeal follows. The sole issue on appeal concerns the amount of attorney's fees awarded plaintiff. The merits of the case are not at issue.
The facts surrounding this action are completely undisputed. In 1979, Mrs. Goff detected a suspicious lump in her left breast. The biopsy performed produced negative results. In 1981, a second biopsy was performed, this time producing positive results. Mrs. Goff thereupon commenced a series of medical treatments, which included chemotherapy and a mastectomy.
After having exhausted all conventional medical treatment possibilities without having achieved a remission of the spreading cancer, Mrs. Goff pursued further treatment at the Immunology Research Center, Ltd. (I.R.C.) in Freeport, Grand Bahama Island, Bahamas. The treatments offered at the I.R.C. were unavailable in the United States because of the general medical consensus that such were less than medically effective.
Mrs. Goff made claims for reimbursement for the medical expenses which she incurred at the I.R.C. This suit results from a denial of such claims. Made defendants in the suit were her employer, Reliance Insurance Company (Reliance), which was self-insured; John Hancock Mutual Life Insurance Company (John Hancock), the administrator of Reliance's health insurance program; Omark Industries, Inc. (Omark), Mrs. Goffs husband's employer which was also self-insured; John Hancock, as the administrator of Omark's health insurance program; and, Blue Cross/Blue Shield of North Carolina. All of the named defendants had refused insurance coverage on the basis that the treatment from the I.R.C. was not "medically necessary", and, as such, was excluded under the policies and/or that Mrs. Goff was not an insured.
The merits of the case were tried before a jury. The jury found that the expenses incurred by Mrs. Goff at the I.R.C. were not covered under Omark's self-insured plan, however, such expenses were covered under Reliance's plan. The jury therefore cast Reliance and John Hancock, its administrator, with 100% of the expenses of treatment. The jury further determined that the denial of coverage by Reliance had been arbitrary and capricious, mandating an award of penalties and attorney's fees.
In accordance with the jury's verdict, the trial court rendered judgment in favor of the plaintiff and against defendants, Reliance and John Hancock, in the amount of $6,128.92 (medical benefits plus a 100% penalty) plus $7,500.00 in attorney's fees. Plaintiff appeals from that judgment for the limited purpose of seeking an increase in the award of attorney's fees. Plaintiff also seeks an additional amount in attorney's fees for work expended on appeal.
La.R.S. 22:657 provides in pertinent part: "... Failure to comply with the provisions of this Section shall subject the insurer to a penalty payable to the insured of double the amount of the health and accidents benefits due under the terms of the policy . together with attorney's fees to be determined by the court...."
The amount of attorney's fees rests largely within the discretion of the trier of fact. White v. Martin GMC Trucks, Inc., 359 So.2d 1094 (La.App..3rd Cir.1978), writ denied, 367 So.2d 391 (La.1978); Fontenot v. F. Hollier & Sons, 478 So.2d 1379 (La.App. 3rd Cir.1985), writ granted, 481 So.2d 1326 (La.1986). Factors to be considered by the trial court in determining the amount of attorney's fees to be awarded include: (1) the legal know how and skill of the attorneys involved; (2) the complexity of the issues inherent in the case; (3) the amount in controversy; and, (4) the success of the party seeking attorney's fees. Dowden v. Commonwealth Life Insurance Co., 407 So.2d 1355 (La.App. 3rd Cir.1981); Naquin v. Air Engineered Systems & Services, 463 So.2d 992 (La.App. 3rd Cir.1985), writ denied, 465 So.2d 735 (La.1985); Sharbono v. H & S Construction Co., 478 So.2d 779 (La.App. 3rd Cir.1985). In cases where attorney's fees are awarded as a result of arbitrary nonpayment of insurance benefits, such award is deemed to be a penalty and the value of the attorney's fees need not be proven. Dowden v. Commonwealth Life Insurance Co., supra; Fontenot v. Town of Kinder, 377 So.2d 554 (La.App. 3rd Cir.1979), writ denied, 379 So.2d 1102 (La.1980).
In the instant case, evidence regarding the services rendered by plaintiff's attorneys in connection with the preparation for and litigation of the present suit was introduced after judgment on the merits at a new trial granted for the limited purpose of reviewing the attorney's fee award. At the conclusion of the hearing, the trial judge found that the original attorney's fee award of $7,500.00 was appropriate.
For the reasons which follow, we ultimately determine that the attorney's fee award made by the trial court is too low and constitutes an abuse of discretion. We reach this conclusion based upon the factual findings of the trial court considered in light of the settled principles to be considered in making an appropriate award of attorney's fees.
The trial court correctly found that the issues presented in this case were novel, varied and extremely complex. A review of the record reveals not only novel and complex coverage issues but extremely novel and complex medical issues. The trial court also correctly concluded that the plaintiff's attorneys' skill in handling the issues and their diligence and preparedness during the trial of the matter was extraordinarily high.
The trial court noted in its reasons for judgment that an attorney's fee award based upon $75.00 per hours was appropriate and reasonable and "there was some approximately 200 to 250 hours of attorney's time put in." In spite of these conclusions, the trial court awarded only $7,500.00 in attorney's fees reasoning as follows:
"... Accepting the higher amount, 250 hours, the Court would find that the sum of $18,000.00 at the rate of $75.00 would be due; about 200 hours, which is probably somewhat fairer would be $14,000.00. The Court has already awarded over 50% of this amount. / realize the award is low reagarding the time put in, but considering all of the factors I consider it the most that I can do at this time." (Emphasis ours).
Presumably the trial court did not make the award which it considered to be the "fairer" award, i.e., $14,000.00 by reason of its determination that the amount in controversy was low and plaintiff was only 50% successful. We conclude that in these respects the trial judge erred.
Admittedly, the award to plaintiff of $6,128.92 (medical benefits due plus the 100% penalty) is a relatively low award. However, this award does not reflect the true value of the judgment rendered in plaintiff's favor. The suit was originally filed for approximately $3,000.00 in accumulated benefits. Although this is a small amount, the evidence adduced at trial clearly established that the therapy which Mrs. Goff is undergoing at the I.R.C. is not limited to a specific number of isolated treatments, but rather will continue for the remainder of her life. Continued coverage for these services by Reliance and John Hancock has now been judicially determined. The value of these services will only become fully realized at the end of plaintiff's life. The record does establish that the minimum value of the judgment to plaintiff is $3,000.00 per year. Thus, the amount in controversy, when viewed in light of its potential far reaching effect, certainly cannot be deemed low.
Additionally, it is not uncommon for the courts of this state to award attorney's fees which exceed the dollar demand of the claimant when an award is appropriate under La.R.S. 22:657. Saunders v. General American Life Insurance Company, 364 So.2d 1373 (La.App. 3rd Cir.1978); Majors v. Blue Cross of Louisiana, 399 So.2d 766 (La.App. 3rd Cir.1981); Humphries v. Puritan Life Insurance Company, 311 So.2d 534 (La.App. 3rd Cir.1975). As we stated in Dortlon v. Union Fidelity Life Insurance Company, 326 So.2d 383 (La.App. 3rd Cir.1976):
"Union Federal finally contends the $1,000 attorney fee was excessive because it exceeds the $800 claim. The fee is intended to be a reasonable compensation for the services required to successfully conclude the claim. To limit the fee to the amount of the claim would effectively deny persons with claims amounting to less than reasonable compensation for minimum services the benefit intended by the statute. We find no manifest error in the trial court's refusal to apply such an arbitrary limitation."
In discussing the final factor in the analysis, the trial judge concluded that the success obtained by the plaintiff was "substantially 50%". This determination was apparently based on the fact that plaintiff only recovered against two of the five parties made defendants in the instant suit. We hold such reasoning to be error.
Plaintiff instituted the instant suit to recover the costs of the medical .treatment she had received and which she was continuing to receive at the I.R.C. This is exactly what the judgment accorded her. Although all five named defendants were not held accountable for the expenses, the two defendants held liable were cast for 100% of her claim. In this respect, plaintiff was 100% successful. The judgment against Reliance and John Hancock awards plaintiff payment for all accrued medical expenses and continued treatment for the remainder of her life. Additionally, counsel for plaintiff would have been remiss in their duty had they not sought recovery from all possible defendants.
In sum, reasonable attorney's fees contemplate compensation for all necessary efforts expended by an attorney to win his client's case. In the present case, defendants chose to spend an enormous amount of attorney's time and money on a defense which the trier of fact found to be arbitrary and capricious. This necessitated plaintiff's counsel matching their efforts in time, money and legal expertise. The trial court's award for reasonable attorney's fees should reflect these efforts.
For these reasons, we conclude that the trial court erred when it did not award attorney's fees in an amount which it considered the "fairer" amount solely by reason of the modest award to plaintiff and its determination that plaintiff was only 50% successful. We will amend the judgment to award this amount.
Plaintiff-appellant also seeks an additional award of attorney's fees for work expended by her counsel on appeal. We conclude that the amended award will fairly compensate plaintiff's attorneys for their work both at the trial level and on appeal. For these reasons, the judgment of the trial court is amended so as to increase the award of attorney's fees to the sum of $14,000.00. In all other respects the judgment of the trial court is affirmed. Appel-lees are cast for all costs of this appeal.
AFFIRMED AS AMENDED.
FORET, J., concurs and assigns reason.
KING, J., concurs with reason assigned by FORET, J., and would also grant an increase in attorney fees for appeal.
DOMENGEAUX, J., dissents and assigns reason.
. Blue Cross/Blue Shield of North Carolina was dismissed from the suit early during the proceedings on a motion for summary judgment.