Opinion ID: 1219144
Heading Depth: 4
Heading Rank: 3

Heading: Reasonableness of Amounts Charged for Fees and Expenses

Text: The United States Supreme Court has stated that while `there is no precise rule or formula' for determining attorney's fees, Evans v. Jeff D., 475 U.S. 717, 735-36, 106 S.Ct. 1531, 1542, 89 L.Ed.2d 747 (1986) (quoting Hensley, 461 U.S. at 436, 103 S.Ct. at 1941), the proper starting point for determining the amount of a reasonable fee is the number of hours reasonably expended on the litigation multiplied by a reasonable hourly rate. Hensley, 461 U.S. at 433, 103 S.Ct. at 1939 (considering fee to be awarded under 42 U.S.C. § 1988); accord Ramos, 713 F.2d at 552 (same); Spensieri, 804 P.2d at 270 (estimate of a reasonable attorney fee involves a calculation of the lodestar amount, which represents the number of hours reasonably expended multiplied by a reasonable hourly rate); see Man v. E.P.H. Corp., 638 P.2d 777 (Colo.1981). AWDI has not challenged the amount of time spent by attorneys for the objectors on particular tasks as excessive. Instead, it has contended that the usefulness of the tasks themselves was not limited to the tributary claim and that the scope of the work performed was not reasonable. These objections were rejected earlier in the immediately preceding sections of this opinion. AWDI also has not objected to the reasonableness of the hourly rate charged by attorneys from private law firms. It has stipulated that $100 per hour, the rate charged, was a reasonable rate for those attorneys. Nor has AWDI objected to the rates charged by lawyers for the United States, who were on the staff of the United States attorney. AWDI does object to the rates at which the State's attorneys, who were on the staff of the State attorney general, billed their time. The State claimed, and the court awarded, $100 per hour for attorney time and $50 per hour for the time of legal assistants. AWDI objects to this award because the interdepartmental billings for services of attorneys and legal assistants on the staff of the State attorney general at the relevant time were based on hourly rates of $40.75 and $27.44 respectively. AWDI argues that the state employees cannot be awarded more than these hourly rates. We disagree. Rule 41(a)(2) expressly gives the court power to grant a motion for dismissal under the rule upon such terms and conditions as the court deems proper. Thus, determination of the terms and conditions of dismissal under 41(a)(2) is discretionary with the trial court and will not be disturbed on review absent an abuse of that discretion. Stevedoring Servs. of America v. Armilla Int'l, 889 F.2d 919, 921 (9th Cir.1989); Moore v. C.R. Anthony Co., 198 F.2d 607, 608 (10th Cir. 1952); Bishop v. W. American Ins. Co., 95 F.R.D. 494, 495 (N.D.Ga.1982); see American Cyanamid Co. v. McGhee, 317 F.2d 295, 298 (5th Cir.1963) (trial court has discretion to impose terms and conditions); see also Powers, 832 P.2d at 1102. Typically, courts impose as a term and condition of dismissal a requirement that the plaintiff pay the defendant the expenses incurred in defending the suit, which usually include reasonable attorney fees. Marlow v. Winston & Strawn, 19 F.3d 300 (7th Cir.1994); Mortgage Guaranty, 904 F.2d at 300; LeCompte, 528 F.2d at 603; Bath Iron Works Corp. v. Parmatic Filter Corp., 736 F.Supp. 1175, 1178 (D.Me.1990). The award of attorney fees must be reasonable, and [t]he determination of reasonableness is a question of fact for the trial court and will not be disturbed on review unless it is patently erroneous and unsupported by the evidence. Hartman v. Freedman, 197 Colo. 275, 281, 591 P.2d 1318, 1322 (1979) (fees awarded pursuant to § 8-4-114, C.R.S. (1973)); accord Rifkin v. Steele Piatt, 824 P.2d 32, 35 (Colo.App.1991); Spensieri, 804 P.2d at 270; Greeley Nat'l Bank v. Sloan, 677 P.2d 409, 412 (Colo.App.1983). The trial judge considered the reasonableness of fees issue and expressly determined that [one] hundred dollars an hour by water lawyers... is an extremely minimum rate and eminently reasonable, whether it be in the public or the private sector. We have previously held that attorneys are entitled to an award of reasonable attorney fees at market rates for attorneys of comparable skill, experience and reputation: [47] If the fee requested is reasonable in light of community standards and the other criteria to be considered by the court, it is not appropriate for a court to take into consideration what a major client may pay the attorney on an hourly basis or the possible absence of overhead expenses comparable to those borne by lawyers in private practice. Mau, 638 P.2d at 780 (attorney fees awarded to tenant's attorney pursuant to section 38-12-103(3)(a), 16A C.R.S. (1973) (citation omitted)); see also Spensieri, 804 P.2d at 271 (The criterion for the court is not what the parties agreed, but what reflects reasonable value for services rendered.). Numerous other courts have held that fees awarded are to be based on reasonable billing rates in the relevant community, not net hourly earnings. Hamilton v. Daley, 777 F.2d 1207 (7th Cir.1985) (fees awarded to government attorneys defending against frivolous civil rights suit; fact that attorneys are public servants who will not personally receive any fees awarded makes no difference). [48] Therefore, we find that the hourly rate awarded to the State of Colorado for attorney fees and paralegal services was not an abuse of discretion. AWDI also contends that the amounts allowed for expert witnesses and consultants were unreasonable or unsubstantiated. AWDI points to no particular bills as unreasonable in amount. The objectors documented these fees with billing records, expert testimony summaries, and testimony by attorneys and state personnel as to the nature of the work performed, the method of allocation of expenses between the tributary and nontributary claims, and the reasonableness of the fees charged. There was evidence, although general in nature, that the fees were reasonable for the services performed. The trial court did not simply award to the objectors all attorney fees and expenses requested. Instead, it examined the claims made and assessed the reasonableness and substantiation given for the claims. The trial judge disallowed: (1) the state's claim for reimbursement of $9,000 for court reporter fees; its claim of $173,818 for compensation for nonlegal employees of the Division of Wildlife and the State and Division Engineers' Offices; and its claim of $1300 for a bat detector; (2) the unsubstantiated or unverified claims of Cotton Creek Ranch, Dennis Felmlee and Timothy Lovato; (3) compensation for time and attorney fees spent post-trial in preparing the fee application; and (4) certain room and board expenses. In addition, the trial court, out of an abundance of caution and so as to preclude any concerns about vagueness, overlap, possible redundancy or questionable expense, discounted the attorney fee and expense claims under Rule 41(a)(2) by ten percent. In similar cases with voluminous fee applications, courts have recognized that it is unrealistic to expect a trial judge to evaluate and rule on every entry in an application. See Copeland v. Marshall, 641 F.2d 880, 903 (D.C.Cir.1980) (en banc) (22% cut); Ross v. Saltmarsh, 521 F.Supp. 753, 761-62 (S.D.N.Y.1981) (5% and 10% cuts), aff'd mem., 688 F.2d 816 (2d Cir.1982); Kane v. Martin Paint Stores, Inc., 439 F.Supp. 1054, 1056 (S.D.N.Y.1977) (10% cut), aff'd mem., 578 F.2d 1368 (2d Cir. 1978). These courts have endorsed percentage cuts as a practical means of trimming fat from a fee application. New York Ass'n for Retarded Children v. Carey, 711 F.2d 1136 (2d Cir.1983). We sustain the trial court's determination of the amounts to be awarded for attorney fees and expenses attributable to defenses of the tributary claim.