Court Opinion

ID: 9764311
Source: CourtListenerOpinion
Date Created: 2023-08-29 03:18:36.516407+00
Date Added: 2024-06-11T07:29:55.721046
License: Public Domain

CHRISTEN, Justice,
dissenting in part.
I write separately to express my disagreement with the court's conclusion that the trial court erred by awarding Rule 68 attorney's fees.
The court disapproves of the nominal offer of judgment Alyeska made at the outset of this case due to its "failure to serve the purpose of Rule 68: to encourage settlement and avoid protracted litigation." In my view, Alyeska's early attempts to settle this case combined with the weakness of Anderson's legal claims support the trial court's award of Rule 68 attorneys fees. I would affirm the superior court's order.
Alyeska responded to Anderson's complaint by writing to explain that the legislature's 2004 amendments to AS 28.30.055-Alaska's Workers' Compensation Act-extended the statute's exclusive remedy provisions to Alyeska because Alyeska fell within the statute's amended definition of "project owner." Alyeska actually forwarded its legislative history research to Anderson's counsel and invited counsel to "discuss the law and your dismissal of this suit prior to any additional fees being incurred." When that *1291attempt was unsuccessful, Alyeska answered the complaint and asserted that the suit was barred by the exclusive liability provisions of AS 23.30.055. Alyeska made an early-and admittedly nominal-settlement offer under Rule 68. The offer was accompanied by a cover sheet reiterating that because "the exclusive remedy protection of AS 23.80.055 applies to this case, we think it makes sense to try and secure an early dismissal ... before incurring costs and attorney's fees." Apart from offering to pay a significant amount of money despite its lack of litigation risk, it is hard to identify steps Alyeska could have taken that would have been more likely to avoid incurring significant fees, or to foster a constructive dialogue about the 2004 statutory amendments..
The court "finds no principled distinction between the ten-dollar offer Alyeska made to Anderson at the outset of this case and the initial one-dollar offer in Beal [v. McQuire ]" 1 In my view, there are several reasons Beal is distinguishable. First, the defendants in Beal "served their individual offers of judgment before they asserted their counterclaims.2 Under those cireum-stances, our court viewed the early one-dollar settlement offers in Beal to be consistent with "tactical demands" rather than a "valid attempt[ ] to encourage negotiation.3 Because the settlement offers in Beal were conveyed before the counterclaims had been asserted, the opposing parties had a very limited ability to assess the merits of the dispute. In contrast, Alyeska expressly communicated its theory of the case to Anderson and even forwarded its research on the applicable legislative history. Alyeska's actions were objectively consistent with an attempt to settle the ease in its earliest stages before significant fees were incurred.4
The early offers in Beal were also less likely to result in fruitful settlement discussions because fact discovery was needed in order to gauge the merits of the parties' respective arguments. Alyeska's defense to Anderson's claim was not fact dependent. In the decision issued today, the court acknowledges that "an offer in a case with a tenuous factual basis or controlling legal precedent may be much lower than an offer in a case with a novel legal question." But the court does not acknowledge that it was not necessary to conduct fact discovery to assess the merits of Alyeska's defense; it turned on a purely legal issue of statutory interpretation.
The court seems to place considerable weight on its view that Anderson's case presented a novel legal question because Alyes-ka relied on a newly enacted statute that had not been interpreted by the courts. I agree there was no case law precedent controlling Anderson's claim, but that is because it relied on a recently enacted statute. Anderson's claim was not based on any ambiguity or circularity in the statute. It was based on the argument that the superior court should not construe the term "project owner" according to its statutory definition. As the supreme court's decision observes, "we do not construe statutory language according to its common meaning when the legislature has provided a definition of a word or phrase." The court goes on to reject Anderson's view that the legislative history of the 2004 amendments supports her position, and concludes that Alyeska "clearly meets the statutory definition of 'project owner" under AS Yet the court suggests that nominal offers of judgment should be deemed invalid when a case presents a novel legal question. Here, the troublesome policy questions presented by Anderson apply to hypotheticals not at issue in her case. A novel claim may also be a weak one, and in my view a party defending against a weak legal claim should be able to employ Rule 68 to increase the chances of reaching an early *1292settlement before incurring significant legal fees.
For the same reasons our court concludes that the statutory definition of "project owner" so "clearly and unambiguously" applies to Alyeska, I conclude that Alyeska's early and nominal offer, which was accompanied by its legal analysis and not dependent on factual discovery, was reasonable and valid under Rule 68. And I respectfully dissent from the portion of the court's decision that reverses the superior court's Rule 68 fee award.

. Beal v. McGuire, 216 P.3d 1154, 1178 (Alaska 2009).

. Id.

. Id.

. The court observes that "nothing in the record suggests that Alyeska knew what Anderson's legal arguments might be ... when it made its offer of judgment." In my view, the salient point is that Anderson was in a position to assess the merits of the statutory interpretation question Alyeska gave her its research and analysis. Alyeska was the only one disadvantaged by the fact that Anderson had not disclosed her legal argument.