Court Opinion

ID: 9821108
Source: CourtListenerOpinion
Date Created: 2023-09-01 07:49:30.762644+00
Date Added: 2024-06-11T07:38:48.053572
License: Public Domain

JUDGE WEBB,
concurring in part and dissenting in part.
¶ 59 As to both .Mr. Johnson’s own time and fees of the attorney whom he retained— without court permission — incurred after -he was notified that because the case had settled, he should cease work, the inherent authority doctrine should not be applied for the first time on appeal to affirm the order that the Lalehs pay these sums. In any event, this order was also contrary to the contract — prepared by Mr. Johnson — that he and the Lalehs entered into. Therefore, and with respect, I dissent from those portions of the majority opinion that affirm the court’s order holding the Lalehs liable for collection costs.
I. Introduction
¶ 60 The factual background for this separate opinion is undisputed.
¶ 61 Upon his court appointment, Mr. Johnson and the Lalehs entered into a contract for his professional 'services. Before thé case settled, Mr. Johnson retained an attorney. Neither the contract nor'the order of appointment authorized him to do so. Yet, he failed to request court permission or obtain the Lalehs’ consent.
¶ 62 When the ease settled, the Lalehs promptly notified Mr. Johnson of the settlement and directed him to cease all work. Shortly thereafter, one of the Lalehs questioned a billing that included fees for Mr. Johnson’s attorney. At that point, Mr. Johnson’s only ongoing relationship to the Lalehs was of creditor to debtors.
¶ 63 Like any other creditor, he invested some of his own time and incurred legal expenses in the collection effort. The reasonableness of those efforts was undisputed below, and the majority properly declines to address it for the first time on appeal. But neither the contract nor the appointment-order authorized Mr. Johnson to recover collection eosts.
II. Law
¶ 64 The majority describes this case as having “come[] to us in a unique posture.” Be that as it may, neither Mr. Johnson’s brief nor the majority opinion includes any *297authority expressly upholding an ex post fac-to order allowing a special master or similar court appointee to recover costs of collection. Alone, this void gives me pause.
¶ 65 The majority also makes two concessions that give me further pause.
• “C.R.C.P. 53 is similarly silent about expenses although it does authorize expert compensation more generally.”
• “[T]he better practice is to set the fees at the time of appointment,” citing Reed v. Cleveland Board of Education, 607 F.2d 737, 746 (6th Cir.1979).
¶66 The majority holds that the Lalehs waived any objection to payment of attorney fees incurred by Mr. Johnson because they did not question them until about three weeks after the case had been dismissed. While I concur in that portion of the opinion, the rationale does not warrant recovery of post-settlement attorney-fees, for two reasons,
¶ 67 First, because Mr. Johnson incurred most — if not all — of the post-settlement attorney fees after one of the Lalehs objected to having been billed for such fees, this objection ends the waiver. And more importantly, acquiescence in Mr. Johnson’s use of an attorney to facilitate discharge of his special master duties hardly consents to being liable for the fees Of a collection attorney.
¶ 68 Second, the majority rejects the trial court’s view “that [Mr. Johnson’s] contract so clearly speaks to the issue of costs incurred in the collection of past due fees. Nothing in the relevant language of the contract explicitly mentions collection costs.... [W]e disagree with the trial court’s interpretation of the terms of the engagement agreement.” I agree.
¶ 69 The majority fills this gap by invoking the doctrine of inherent authority, citing Feigin v. Colorado National Bank, N.A., 897 P.2d 814, 820 (Colo.1995); Rush Creek Solutions, Inc. v. Ute Mountain Ute, Tribe, 107 P.3d 402, 406 (Colo.App.2004); and Lauren Corp. v. Century Geophysical Corp., 963 P.2d 200, 203-04 (Colo.App.1998), But the trial court did not mention this doctrine, much less rely on it. Nor was it argued below by Mr. Johnson.
¶ 70 Everyone would agree that appellate courts can and often do. uphold lower court actions for a different reason from that relied on by the lower court, provided the new .reason finds support in the record. But the exercise of inherent power is a matter of discretion. Randleman Excavating Co., Inc. v. Hoder, 522 P.2d 1240, 1241 (Colo.App. 1974) (not published pursuant to C.A.R. 35(f)) (“This inherent, power rests in the sound discretion of the trial court.”). Who can say whether the trial court would have done so, had it concluded — as the majority does — that Mr. Johnson’s contract with the Lalehs did not cover collection costs?
¶ 71 With only this much for guidance, the order should be vacated as to collection costs and the case remanded for the trial court to exercise its discretion.. See Glover v. Innis, 252 P.3d 1204, 1211 (Colo.App.2011). (“Because of its interpretation of the statute, the trial court did not determine whether .,. .those statements themselves would be independently admissible., On remand, the trial court must exercise its .discretion under the statute in accordance with this opinion.”); McCallum Family, L.L.C. v. Winger, 221 P.3d 69, 79 (Colo.App.2009) (“[Whether to exercise that discretion must be determined in the first instance by the trial court, and thus we remand for the trial court to consider this issue.”).
¶72 Still, in my view remand would be futile because even if a trial court’s order allowing a special master or similar court appointee to recover collection costs might under some circumstances be justified using the inherent power doctrine, I would decline to do so herd for one additional reason: allowing Mr. Johnson to recover collection costs violates the Lalehs’ contract with him, on which the trial court expressly relied in rejecting the Lalehs’ arguments invoking the American Rule, (“The court finally finds that Mr. Johnson’s legal fees constitute part of ‘all fees and-expenses’ of Mr. Johnson.,..”).
¶73 Of course, a court may decline to enforce a contract for many reasons. But Mr. Johnson has not sought to disavow his contract. To the contrary, and at his urging, the trial court relied on it — mistakenly, as the majority correctly holds — to afford him recovery of collection cos,ts.
¶74 Because the contract was bilateral, both Mr. Johnson and the Lalehs had obli*298gations under it. Analytical Design & Constr. Grp., Inc. v. Murray, 690 P.2d 269, 272 (Colo.App.1984) (“Here, Capitol’s loan commitment was not a bilateral contract creating mutual obligations....”). • And the Lalehs’ obligations to Mr. Johnson did not extend to paying his costs of collection, including attorney fees. See generally Allison v. Bank One-Denver, 289 F.3d 1223, 1244-45 (10th Cir.2002) (applying Colorado law to disallow recovery of attorney fees incurred in enforcing an indemnity agreement).
¶ 75 Thus, in choosing to contest — rathér than pay — Mr. Johnson’s claims for his fees and those of his attorney, the Lalehs had no reason to include in their risk analysis being held liable for his collection costs. “Courts cannot make contracts for parties and then order them specifically performed.” Schreck v. T & C Sanderson Farms, Inc., 37 P.3d 510, 514 (Colo.App.2001). Yet, by affirming under the doctrine of inherent judicial authority, the majority does just that here. Thus, I would reverse the collection costs portion of the order as an unlawful modification of ⅛ valid contract.