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Nielson v. Benton (5/1/98), 957 P 2d 971
Notice: This opinion is subject to correction before publication in
the Pacific Reporter. Readers are requested to bring errors to the attention of the
Clerk of the Appellate Courts, 303 K Street, Anchorage, Alaska 99501, phone (907)
264-0608, fax (907) 264-0878.
THE SUPREME COURT OF THE STATE OF ALASKA
KATHY NIELSON and LOREN )
DOMKE, husband and wife, ) Supreme Court No. S-7747
Appellants, ) Superior Court No.
) 1JU-92-1554 CI
DAVID BENTON and LORI TELFER, ) O P I N I O N
husband and wife, )
) [No. 4978 - May 1, 1998]
Appeal from the Superior Court of the State of
Alaska, First Judicial District, Juneau,
Walter L. Carpeneti, Judge.
Appearances: Loren Domke, Loren Domke, P.C.,
Juneau, for Appellants. Thomas W. Findley, Dillon and Findley,
P.C., Juneau, for Appellees.
Before: Matthews, Chief Justice, Compton,
Eastaugh, Fabe, and Bryner, Justices.
Kathy Nielson and Loren Domke appeal from a superior
court judgment awarding Lori Telfer and David Benton fifty percent
of their actual reasonable attorney's and paralegal fees for
litigating a dispute concerning a failed home sale. We affirm.
II. FACTS AND PROCEEDINGS
In February 1992 Lori Telfer and David Benton contracted
to buy a home from Kathy Nielson and Loren Domke. See Nielson v.
Benton, 903 P.2d 1049, 1050 (Alaska 1995). Prior to closing,
Benton and Telfer discovered a number of physical defects in the
property, as well as a cloud on Nielson and Domke's title. See id.
at 1050 51. They expressed a wish to rescind the contract; Nielson
and Domke threatened to sue to enforce it. See id.
In August 1992, after further disputes about the defects
in the property, Nielson and Domke filed suit. They initially
sought both specific performance and damages for Benton and
Telfer's alleged breach of the contract. See id. at 1051.
Although their demand for specific performance was effectively
mooted in September 1992, they did not withdraw it until
April 1993. Benton and Telfer asked the court to rescind the
contract. See id. They also brought counterclaims for damages for
misrepresentation and infliction of emotional distress.
The superior court ultimately rescinded the contract, but
rejected all other claims filed by both parties. See id. It also
awarded Benton and Telfer attorney's and paralegal fees. See id.
at 1053. Nielson and Domke appealed the rescission and the award
of fees. See id. at 1052, 1054. We affirmed the superior court's
decision on the merits, but remanded the case for recalculation of
attorney's and paralegal fees in accordance with Alaska Civil
Rule 82, as amended. See id. at 1055.
On remand, the superior court awarded Benton and Telfer
fifty percent of their actual reasonable attorney's and paralegal
fees, or $10,303. The court thus departed from Rule 82's benchmark
award of twenty percent. This appeal followed.
A. Standard of Review
"[A]n award of attorney's fees is within the discretion
of the trial court. [Rule] 82(a) grants the trial court discretion
to award fees in excess of the rule's schedule. We will not
reverse a fee award unless the trial court has abused that
discretion." Steenmeyer Corp. v. Mortenson-Neal, 731 P.2d 1221,
1226 (Alaska 1987). A trial court abuses its discretion when it
makes a "manifestly unreasonable"determination. Sweet v. Sisters
of Providence, 895 P.2d 484, 497 n.15 (Alaska 1995).
B. The Enhancement of the Fee Award Was Not Manifestly
Rule 82(b) provides in part:
(2) In cases [resolved without trial] in
which the prevailing party recovers no money judgment, the court .
. . shall award the prevailing party . . . 20 percent of its actual
attorney's fees which were necessarily incurred. The actual fees
shall include fees for legal work . . . performed by . . . [a]
paralegal . . . .
(3) The court may vary an attorney's fee
award calculated under subparagraph [(b)(2)] if, upon consideration
of the factors listed below, the court determines a variation is
. . . .
(E) the attorneys' efforts to minimize
(F) the reasonableness of the claims and
defenses pursued by each side;
. . . .
(H) the relationship between the amount
of work performed and the significance of the matters at stake;
. . . .
(K) other equitable factors deemed
If the court varies an award the court shall
explain the reasons for the variation.
Since the court awarded Benton and Telfer fifty percent
of actual fees, rather than the benchmark twenty percent, it was
required to justify its variation. It did so, referring
specifically to factors (E), (F), and (H). Nielson and Domke
contend that the court erred in assessing those factors, and in
failing to consider factor (K), "other equitable factors,"as
favoring a lower award. This claim lacks merit. The superior
court explained in painstaking detail its reasons for placing
varying degrees of weight on factors (E), (F), and (H), which
favored an increased award, and for refusing to place any weight on
other factors. [Fn. 1]
As for factor (K), Nielson and Domke contend that their
successful defense against certain counterclaims is an "equitable
factor"favoring a reduction in the fee award. This argument aims
to circumvent our rule that courts need not apportion fees by issue
in civil cases. See Hickel v. Southeast Conf., 868 P.2d 919, 924
(Alaska 1994); Gold Bondholders Protective Council v. Atchison,
Topeka & Santa Fe Ry., 658 P.2d 776, 779 (Alaska 1983). To hold
that a court abuses its discretion if it fails to treat a non-
prevailing party's victory on a subsidiary issue as an "equitable
factor"mandating reduction of an award would be to establish an
apportionment rule under a different name.
As for factors (E), (F), and (H), the superior court's
conclusions, taken together, amply support its award. It concluded
that Nielson and Domke brought a weak claim, "unfairly sought to
pressure [Benton and Telfer] by applying for a prejudgment writ of
attachment,"pursued a weak specific performance demand for an
extended period, and maintained a high level of litigation relative
to the amount of money at stake. An award of fifty percent of
actual reasonable attorney's and paralegal fees under these
circumstances is not "manifestly unreasonable." Sisters of
Providence, 895 P.2d at 497 n.15. The superior court thus did not
abuse its considerable discretion in making the award.
The court discussed each of the first eight factors (i.e., (A)
through (H)) outlined in Rule 82(b)(3). It found no reason to vary
the award based on any factors other than the three noted above.
Nielson and Domke do not argue that it should have applied factors
(I) or (J).