Opinion ID: 1198908
Heading Depth: 3
Heading Rank: 2

Heading: Award of fees for two sets of attorneys

Text: PCI filed its malpractice action against the law firm of Taylor & Hintze and against various individual members of the firm, one of whom was Robert G. Taylor. Two law firms entered appearances for the defendants: Taylor & Hintze and all individual members except Taylor were represented by one firm; Taylor had separate counsel. All defendants joined in TH's pretrial offer of judgment. Because their offer proved more favorable than PCI's verdict, they were entitled to an award of post-offer prevailing-party attorney's fees calculated under Civil Rule 82. Former Alaska R. Civ. P. 68(b)(1). Applying Rule 82's contested with trial schedule, the trial court awarded defendants 30% of their actual attorney's fees from the date of the offer of judgment through trial; the fee award covered billings submitted by both sets of defense counsel, totaling $143,397 to TH and $144,489 to Taylor. PCI challenges the dual attorney's fee award on numerous grounds: (1) Taylor and TH asserted virtually identical defenses; (2) TH and Taylor were a single party under Civil Rule 68(b)(1); (3) the award of double fees amounted to a windfall for defendants' malpractice insurer and was inequitable because PCI had to litigate against an insurance carrier which spent 2 million dollars contesting the amount of plaintiff's damages; (4) the dual award covered fees that both counsel had not actually needed to incur; and (5) the award deprived PCI of access to the courts as guaranteed by the constitutional rights of equal protection and due process. These arguments are meritless. PCI's suit named a law firm and six individual attorneys as defendants in a malpractice claim arising from the dismissal of a sizable and complex breach of contract action. Taylor and TH asserted substantially different positions: TH admitted liability and disputed only damages; Taylor denied liability. An affidavit submitted by TH's counsel declared that [counsel for Taylor] and [I] made every effort to minimize expense and duplication. We coordinated our efforts on motion work, deposition preparation and trial preparation to the extent possible. The trial court found this affidavit credible, concluding that the fees incurred after the offer of judgment by each firm were reasonable and necessary, and that the lead attorneys for the co-defendants made every effort to minimize expense and duplication and coordinated their efforts on motion work, deposition preparation and trial preparation to the greatest extent possible. The court further found that all of the hourly rates charged by the various attorneys and paralegals are reasonable. PCI has failed to show that these findings are manifestly unreasonable. See Integrated Resources Equity Corp., 799 P.2d at 304; Conant, 893 P.2d at 1268. Nor has PCI shown that they are beyond the contemplated scope of the offer-of-judgment rule [28] or are otherwise oppressive. The purpose of Rule 68 is to encourage settlement and to avoid protracted litigation. See Continental Ins. Co. v. U.S. Fidelity & Guar. Co., 552 P.2d 1122, 1125-26 (Alaska 1976). The joint offer of judgment clearly indicated all claims between the parties would be resolved if the offer were accepted, Taylor Constr. Serv., Inc. v. URS Co., 758 P.2d 99, 102 (Alaska 1988), and unequivocally put PCI on notice that, in failing to accept the offer, [PCI] assumed the risk of the penalty. Id. A sizable and experienced company, PCI assumed this risk with open eyes. The trial court's fee decision is not manifestly unreasonable.