Opinion ID: 672338
Heading Depth: 2
Heading Rank: 2

Heading: The Reasonableness of PSC's Attorneys' Fees and Costs in

Text: 71 the Waranch Litigation. 72 The right to recover attorneys' fees is substantive and therefore determined by state law in diversity cases. King Resources Co. v. Phoenix Resources Co., (In re King Resources Co.), 651 F.2d 1349, 1353 (10th Cir.), cert. denied, 454 U.S. 881, 102 S.Ct. 370, 70 L.Ed.2d 195 (1981). In a Colorado breach of trust action, an award of attorneys' fees was held to be within the discretion of the trial court; the award should make the injured party whole and the court may consider the amount in controversy, the length of time required to represent the client effectively, the complexity of the case, the value of the legal services to the client, and the usage in the legal community concerning fees in similar cases. Heller v. First National Bank of Denver, N.A., 657 P.2d 992, 999-1000 (Colo.App.1982); see also Hartman v. Freeman, 197 Colo. 275, 591 P.2d 1318, 1322 (1979) (same factors applied to statutory award of attorneys' fees). The award should be based on consideration of the lodestar amount--the amount representing the number of hours reasonably expended multiplied by a reasonable hourly rate. Dahl v. Young, 862 P.2d 969, 973 (Colo.App.1993). 73 In federal proceedings, the district courts [should] articulate specific reasons for fee awards to give us an adequate basis for review. Ramos v. Lamm, 713 F.2d 546, 552 (10th Cir.1983). 11 In that appellate review, findings of underlying questions of fact are subject to the clearly erroneous standard of review and an attorneys' fee award will be upset on appeal only if it represents an abuse of discretion. Mares v. Credit Bureau of Raton, 801 F.2d 1197, 1201 (10th Cir.1986). 74 The trial judge's findings and conclusions on fees and costs found the hourly rates for attorneys who worked on the Waranch case were reasonable, and that their reasonableness was not contested. Findings of Fact and Conclusions of Law at 2. The judge found that PSC's witnesses, Lyons and Flanagan, who testified on such fees, were credible. Id. Three small deductions were made by the judge ($815.00 billed on defense of the Waranch case; $195.00 billed for an attorney to hear the closing argument; and $212.50 for a 1981 overcharge). Id. The judge found that 1,575 hours were reasonably spent on the Waranch case defense. Principal Brief of Appellant, App. 2 at 0249-50. This is the matter in controversy on appeal as the rates for the attorneys are not challenged here. 75 Applying a lodestar approach, the judge concluded that $121,684.25 of the adjusted fees were reasonable; he also said this was confirmed by the totality of the circumstances test and application of the A.B.A.Code of Professional Responsibility. He applied a PSC formula for calculating total damages and arrived at a final judgment on damages of $459,477.17. 76 In its brief, CNA points to various legal charges for which no specific task description appears in billing statements introduced to the court below. Principal Brief of Appellant at 31-32. While the absence of specific task descriptions may preclude an award of fees in cases arising under a federal fee-shifting statute (e.g., Ramos v. Lamm, 713 F.2d 546, 555 (10th Cir.1983) (noting that in order to justify fee award under federal fee-shifting provision, district court must carefully scrutinize [attorney billings], much as a senior partner in a private firm would review the reports of subordinate attorneys when billing clients whose fee arrangement requires a detailed report of hours expended and work done)), the same degree of specificity is not required in the context of contractual fee awards. Normally, where the court is merely enforcing a contractual provision authorizing attorneys' fees, the fees are routinely awarded and the contract is enforced according to its terms. Western States Mechanical Contractors, 834 F.2d at 1548 (expressly declining to apply [c]lose scrutiny of Ramos in contractual fee award context). 77 Accordingly, despite the apparent absence of detailed task descriptions relating to some of the time billed by counsel to PSC in the Waranch action, the district court did not err in ordering CNA to indemnify the expenditures for these legal services. PSC introduced testimony indicating that the hours billed did in fact reflect actual Waranch-related work, albeit unspecified, and the district judge found Mr. Flanagan, who testified on these matters, to be credible. Principal Brief of Appellant, App. 2 at 0279-95; id. at 0249-50. 78 CNA also contends the district court erred in awarding certain fees for which PSC purportedly never paid its Waranch counsel, and other fees which allegedly did not relate to the Waranch litigation at all. Principal Brief of Appellant at 33. Regardless of the merits of these claims, we decline to address them to the extent they were not raised below. We do not feel that the trial judge was obligated to comb the evidence before him--consisting of voluminous attorney billing records--to ferret out gaps or inconsistencies in the evidence presented on the fees. Instead, if PSC believed the evidence was somehow deficient, it should have brought the matter to the court's attention. 79 In sum, we are not persuaded that CNA has demonstrated that the findings of fact were clearly erroneous as to the fee award made for the Waranch litigation, including the Colorado PUC proceedings. With one minor modification we make, 12 we accordingly uphold the fee award.