Opinion ID: 222537
Heading Depth: 1
Heading Rank: 3

Heading: Batzli’s Cross Appeal

Text: In his cross appeal, Batzli contends that the district court erred when reducing the damage award from $8400 to $1 and argues that the evidence supported the jury’s award of compensatory damages. Batzli concedes that ruling in his favor would require our determination that he presented sufficient evidence to permit a reasonable jury to determine that the attorney’s fees sought were reasonable and necessary. See Hiss v. Friedberg, 201 Va. 572, 577, 112 S.E.2d 871, 876 (1960) (“[W]here a breach of contract has forced the plaintiff to maintain or defend a suit with a third person, he may recover the counsel fees incurred by him in the former suit provided they are reasonable in amount and reasonably incurred.”) (emphasis added); accord Fidelity Nat’l Title Ins. Co. of N.Y. v. S. Heritage Title Ins. Agency, 257 Va. 246, 254, 512 S.E.2d 553, 558 (1999). Minnesota Mutual does not contest the fact that its refusal to provide coverage under the policy necessitated Batzli’s independent retention of legal counsel to defend the Chasen complaint—i.e. that Batzli incurred damages. To support the contention that the damage award was reasonable, Batzli points 32 to the malpractice complaint which he argues demonstrates the complexity and high stakes of the case, the fact that the complaint had been “pending” for a year, 20 and Batzli’s testimony that he had incurred $8,400 in legal fees for the defense of the malpractice action. We conclude that such a paltry evidentiary showing was insufficient as a matter of law to support a determination that the amount awarded as damages was “reasonable.” In Chawla v. BurgerBusters, Inc., 255 Va. 616, 499 S.E.2d 829 (1998), the Supreme Court of Virginia stated: In determining whether a party [seeking recovery of attorney’s fees] has established a prima facie case of reasonableness, a fact finder may consider, inter alia, the time and effort expended by the attorney, the nature of the services rendered, the complexity of the services, the value of the services to the client, the results obtained, whether the fees incurred were consistent with those generally charged for similar services, and whether the services were necessary and appropriate. Id. at 623, 499 S.E.2d at 833. In Mullins v. Richlands Nat’l Bank, 241 Va. 447, 403 S.E.2d 334 (1991), the court said: “In determining a reasonable fee, the fact finder should consider such circumstances as the time consumed, the effort expended, 20 Notwithstanding Batzli’s argument to the contrary, the amount of time that had elapsed since the complaint was filed is irrelevant to our inquiry given the absence of any evidence regarding what, if any, actions were taken by Batzli’s lawyers to defend against the Chasen complaint during that time. 33 the nature of the services rendered, and other attending circumstances. Ordinarily, expert testimony will be required to assist the fact finder.” Id. at 449, 403 S.E.2d at 335. 21 Here, there was no testimony regarding how much time Batzli’s lawyers spent on the defense of the Chasen complaint, no indication of what services they performed in their representation of Batzli, and no testimony, expert or otherwise, regarding the rates charged by lawyers defending malpractice suits in Virginia. In light of Chawla and Mullins, we conclude that Batzli’s argument—that $8,400 was per se reasonable in light of the amount sought in the “complex” malpractice action— is meritless. See Crist, 231 Va. at 195, 343 S.E.2d at 311. In short, Batzli had the burden of demonstrating that the attorney’s fees paid to the lawyers defending the Chasen complaint were reasonable, and he failed to satisfy that burden. This allocation of the burden of proof is also dispositive of Batzli’s second argument. Batzli maintains that because 21 Expert testimony is not necessarily required if lay testimony can establish the reasonableness of the fee award. For instance, when a party seeking attorney’s fees submitted “almost 300 pages of contemporaneous time records detailing the activities for which fees were sought” and “affidavits of its attorneys upon the reasonableness of the hourly rates charged and the accuracy of the time billed,” the court ruled that expert testimony was not necessary. Tazewell Oil Co., Inc. v. United Va. Bank, 243 Va. 94, 111-12, 413 S.E.2d 611, 620-21 (1992). No such time records or affidavits were presented in this case. 34 Minnesota Mutual did not object to the evidence entered in support of the reasonableness determination, he is foreclosed from arguing that the amount awarded was unreasonable. However, applying such a rule would relieve the plaintiff of the burden of making a prima facie case simply because his opponent was silent. We decline Batzli’s invitation to so dramatically shift the burden of proof. Ultimately, to decide the cross appeal in Batzli’s favor would require the absurd conclusion that a party establishes the “reasonableness” of attorney’s fees if (when viewed in the light most favorable to that party), the evidence shows that the fees were assessed in a difficult case. However, following Chawla and Mullins, we conclude that more is required to support a determination that the attorney’s fees assessed were reasonable. 22 Because Batzli failed to present evidence to establish the reasonableness of the attorney’s fees for which he 22 As discussed above, the district court did not rely on the actual compensatory damages award of $8,400 to confirm Batzli’s satisfaction of the damage element of a prima face breach of contract claim. Instead, the court imposed nominal damages. Indeed, if precisely quantifiable actual damages were the only basis for finding a breach of contract in this case, the court would have been compelled to grant Minnesota Mutual’s motion. See Bennett v. Fairfax Cnty., Va., 432 F.Supp.2d 596, 600 (E.D. Va. 2006) (stating that a court “must enter judgment as a matter of law if . . . the verdict in favor of the nonmoving party would necessarily be based on speculation and conjecture.”)(quotation omitted). 35 was to be compensated through the jury’s award of damages, the district court did not err by setting aside that damage award.