Court Opinion

ID: 9755486
Source: CourtListenerOpinion
Date Created: 2023-08-28 20:39:25.351052+00
Date Added: 2024-06-11T07:28:07.955867
License: Public Domain

FABE, Justice,
with whom CHRISTEN, Justice, joins, dissenting.
I disagree with the court's conclusion that the contract between O'Connell and the Wills authorizes the award of post-judgment collec*48tion costs. In my view, the attorney's fee provision in the contract simply does not contemplate these expenses. The contract provides that the signatories "promise[ ], in case suit is instituted, to collect this note, or any portion thereof, in addition to the costs and disbursements of said suit, a reasonable attorney's fee in such suit or action ...." (Emphasis added.) Because the phrase "reasonable attorney's fee in such suit or action" cannot be construed to include post-judgment collection costs, I respectfully dissent.
When interpreting contracts, we have stated that our "duty is to 'ascertain and give effect to the reasonable intentions of the contracting parties'" 1 We determine the intention of contracting parties by "resort to the language of the disputed provision and other provisions, relevant extrinsic evidence, and case law interpreting similar provisions." 2
I conclude that the term "attorney's fees," when examined using the traditional tools of contract interpretation, does not include collection costs. The addition in this contract of the qualifier "in such suit or action" makes me more certain of this conclusion. By referring to "such suit or action," the contract expressly provides only for attorney's fees incurred during the litigation of the action in the trial or appellate courts.
Black's Law Dictionary defines "suit" as "[alny proceeding by a party or parties against another in a court of law" 3 and "action at law" as "[al civil suit stating a legal cause of action and seeking only a legal remedy." 4 The court reasons that Black's Law Dictionary defines "suit" as being a "proceeding" and that, under some definitions, "proceeding" has been defined to include "ancillary or provisional steps" such as enforcement of a judgment. The court therefore concludes that a "suit" can include post-judgment collection efforts. There are several flaws in this argument. Not every "proceeding" is a "suit." A "suit" does not include all "proceedings," only those "proceedings" that take place "in a court of law." 5 And even if post-judgment collection efforts can be classified as "proceedings," they are not "proceedings" that take place "in a court of law." The word "suit" is limited to the litigation of an actual lawsuit in the trial or appellate courts.
Treating "attorney's fees" as distinct from "costs of collection" is especially natural in Alaska. Alaska, unlike other jurisdictions, has a longstanding practice of awarding partial attorney's fees, first by statute and then by Civil Rule 82.6 The phrase "attorney's fees" is therefore widely used in Alaska and has come to have a particular meaning here. When parties include a provision for attorney's fees in their contract, they draft that provision in the shadow of Rule 82.
In construing Rule 82's provision for "attorney's fees," we have given that term a specific and limited meaning, excluding other activities outside of litigation.7 Civil Rule 82 fees "must relate solely to attorney's services performed in the case in which the judgment is entered.8 We have limited fee awards for attorney's services to the "costs of the action" 9 and have expressly interpreted Civil Rule 82 to provide compensation "only ... *49for attorney's services performed up to the time of judgment." 10 And we have only made an exception to our rule that fees may not be awarded for collection efforts in cases involving the "collection of judgments for child support{, which] is a special subject to which special rules apply." 11 In Torrey, we also clarified that post-judgment attorney's fees may not be collected under the authority of Civil Rule 79; "Rule 79, like Rule 82, only relates to costs expended up to the time of judgment." 12
This E{understanding of "attorney's fees" comports with the national understanding that "attorney's fees" and "costs of collections" are distinct terms. Accordingly, when parties use the term "attorney's fees" in their contract, they can be presumed to use that term as distinct from costs of collection. If contracting parties wish to allocate costs of collection, they can do so-but they must do it expressly.
Examining case law from other jurisdictions interpreting similar provisions confirms that attorney's fees are distinct from post-judgment collection costs. Many judicial decisions discussing the relationship between attorney's fees and post-judgment costs of collection have involved contracts that featured express provisions for both "attorney's fees" and "costs of collection." 13 The practice reflected in these decisions is 'that a separate provision for "costs of collection" needs to be added to a contract if such a provision is desired. The contracting parties in these cases and the courts that have reviewed similar clauses have referred to attorney's fees and costs of collection as distinct items.14
The court reasons that Gamble v. North-store Partnership 15 counsels that we should construe contractual provisions for attorney's fees broadly and therefore concludes that the attorney's fee provision in this contract should be construed to include post-judgment collection costs. But while Gamble establishes that we should interpret contractual provisions for attorney's fees broadly, collection costs are distinct from attorney's fees. I would therefore affirm the superior court and respectfully dissent.

. Estate of Polushkin ex rel. Polushkin v. Maw, 170 P.3d 162, 167 (Alaska 2007) (quoting Western Pioneer, Inc. v. Harbor Enters., Inc., 818 P.2d 654, 656 (Alaska 1991)).

. Western Pioneer, 818 P.2d at 656. 2

. Black's Law Dictionary 1572 (9th ed. 2009).

. Id. at 33. 4

. Id. at 1152 (defining "suit" as "[alny proceeding by a party or parties against another in a court of law ") (emphasis added).

. Teresa W. Carns & Susanne DiPietro, Alaska's English Rule: Attorney's Fee Shifting in Civil Cases, 13 Auaska L.Rev. 33, 39-40 (1996).

. Marsingill v. O'Malley, 128 P.3d 151, 163 (Alaska 2006) ("[I]t was error to award attorney's fees for legislative work and for work related to the first appeal."); Alaska State Hous. Auth. v. Riley Pleas, Inc., 586 P.2d 1244, 1249 (Alaska 1978) (declining to award attorney's fees for fees incurred in arbitration).

. Torrey v. Hamilton, 872 P.2d 186, 187 (Alaska 1994).

. Cameron v. Hughes, 825 P.2d 882, 887 (Alaska 1992) (quoting O'Link v. O'Link, 632 P.2d 225, 231 (Alaska 1981)), limited by Torrey, 872 P.2d at 188 n. 1.

. Torrey, 872 P.2d at 187.

. Id. at 188 n. 1.

. Id. at 188.

. See, eg., Alabama State Bar v. Hallett, 26 So.3d 1127, 1130 (Ala.2009); Thomas v. Arkoosh Produce, Inc., 137 Idaho 352, 48 P.3d 1241, 1250 (2002); Tulley v. Sheldon, 159 NH. 269, 982 A.2d 954, 958 (2009); Harsch Props., Inc. v. Nicholas, 182 Vt. 196, 932 A.2d 1045, 1047 (2007).

. See, eg., Int'l Sales-Rentals Leasing Co. v. Nearhoof, 263 So.2d 569 (Fla. 1972); Am. Serv. & Supply Co. v. Raby, 348 Mass. 720, 206 N.E.2d 94, 95-96 (1965) (referring to both attorney's fees and costs of collection); Strenge v. Clarke, 89 Wash.2d 23, 569 P.2d 60 (1977) (referring to three categories of expenses: collection costs, court costs, and attorney's fees).

. 28 P.3d 286 (Alaska 2001).