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North Slope Borough v. Green International, Inc. (1/15/99), 969 P 2d 1161
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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
NORTH SLOPE BOROUGH, )
DEPARTMENT OF ADMINISTRATION )
AND FINANCE, TAX AUDIT ) Supreme Court No. S-8151
DIVISION; NORTH SLOPE BOROUGH )
ASSEMBLY; and NORTH SLOPE ) Superior Court No.
BOROUGH BOARD OF EQUALIZATION,) 3AN-96-9450 CI
)
Appellants, ) O P I N I O N
)
v. )
)
GREEN INTERNATIONAL, INC., ) [No. 5067 - January 15, 1999]
)
Appellee. )
______________________________)
Appeal from the Superior Court of the State of
Alaska, Third Judicial District, Anchorage,
Sigurd Murphy, Judge, pro tem.
Appearances: Steven E. Sumida, Assistant
Borough Attorney, Barrow, for Appellants. Herbert A. Viergutz,
Barokas & Martin, Anchorage, for Appellee.
Before: Matthews, Chief Justice, Compton,
Eastaugh, Fabe, and Bryner, Justices.
PER CURIAM.
I. INTRODUCTION
We must decide whether the superior court erred in
failing to award costs and attorney's fees after dismissing without
prejudice to refiling in Barrow an administrative appeal that had
been improperly filed in Anchorage. Although we conclude that the
award was a matter for the court's discretion under Alaska
Appellate Rule 508, we remand because the court applied an
incorrect legal standard in denying costs and fees.
II. FACTS AND PROCEEDINGS
On December 29, 1995, the North Slope Borough Board of
Equalization (NSB) assessed personal property taxes against Green
International (Green) for the period spanning 1989 to 1993. Green
filed an administrative appeal, which it lost. Green appealed that
decision to the superior court, filing its notice of appeal in
Anchorage. After unsuccessfully attempting to convince Green to
stipulate that Barrow was the appropriate location for filing the
appeal, NSB moved to transfer venue, arguing that venue in
Anchorage was improper. On March 17, 1997, the superior court in
Anchorage granted NSB's motion and ordered Green's complaint
dismissed "without prejudice if appeal is filed with the Second
Judicial District, Barrow [within] 15 days."
Green refiled its appeal in Barrow and did not appeal the
Anchorage superior court's order. On April 3, 1997, NSB filed a
motion in the Anchorage case requesting $2100 in costs and
attorney's fees that it had incurred while litigating venue. Green
opposed and asked for costs and attorney's fees that it had
incurred in opposing NSB's motion for costs. The superior court
denied fees and costs to both parties stating: "This was a fairly
close jurisdictional question. There was no vexatious action by
either party. Costs may be addressed at [the] conclusion of
appeal." NSB appeals this denial.
III. DISCUSSION
Given that Green did not appeal the superior court's
March 17 order of dismissal, we assume for purposes of this
decision that the court was correct in determining that Green's
appeal was improperly filed in Anchorage [Fn. 1] and that a
dismissal, rather than a transfer of venue, was the appropriate
remedy for Green's improper filing. [Fn. 2]
In denying NSB's motion for costs and fees, the superior
court in Anchorage indicated that the issue of NSB's prevailing
party costs and fees could be taken up after disposition of the
appeal in Barrow. Implicit in this approach is the view that the
Anchorage and Barrow appeals amounted to a single proceeding --
that dismissal without prejudice was a de facto transfer of venue.
This view is incorrect as a matter of law. The March 17 order
dismissing Green's appeal without prejudice terminated the appeal
in Anchorage and was a final order. [Fn. 3] Because the order was
dispositive, it triggered the provisions of Appellate Rule 508,
which govern the award of costs and fees on appeal. [Fn. 4] The
superior court's denial of NSB's motion for costs and fees amounted
to a final judgment in favor of NSB on the merits and against NSB
on the issue of costs and fees. [Fn. 5]
Since the dismissal of Green's appeal in Anchorage
terminated the Anchorage appeal and made it necessary for Green to
institute a new appeal in Barrow, the superior court erred in
concluding that the issue of costs and fees could be deferred for
consideration by the Barrow court upon disposition of the Barrow
appeal. [Fn. 6]
NSB relies on McClellan v. Kenai Peninsula Borough [Fn.
7] for the proposition that it had a right to receive full fees and
costs for prevailing against Green on the issue of venue. But
McClellan is distinguishable. There, the superior court had ruled
on the merits of a dispositive motion after improperly assuming
venue. On appeal, this court indicated that "[t]o help protect
defendants from having their right to proper venue denied, a motion
for costs for having to make a change of venue motion is proper."
[Fn. 8] Here, by contrast, the appeal in Anchorage was dismissed
without consideration of the merits of the controversy. Thus, NSB
was never in the position of "having [its] right to proper venue
denied . . . ."[Fn. 9]
Moreover, unlike the present case, McClellan was not an
administrative appeal. Its holding does not directly apply here,
because with respect to administrative appeals, prevailing party
costs and fees are specifically governed by Appellate Rule 508,
which vests appellate courts with broad discretion. [Fn. 10]
Although the superior court ordinarily need not
articulate its reasons for awarding attorney's fees on appeal, it
is required to explain denials in cases involving affirmances or
reversals under Appellate Rule 508(b) or (c), because without an
explanation this court cannot be sure "whether [a] denial was an
exercise of . . . discretion, or the result of a possibly mistaken
belief that the requesting party was not entitled to any fees."
[Fn. 11] Further, in such cases, fees are the norm and "shall be
allowed""unless ordered by the court."
In contrast, this case is governed by Appellate Rule
508(a), under which the norm is not to award fees "unless otherwise
ordered." Since the court did not deviate from the norm,
ordinarily no explanation would be required. However, under the
circumstances of this case, we believe that a remand and an
explanation is warranted because it appears that the superior court
misapprehended the law. Here, the superior court's denial of costs
and fees was prompted to a certain extent by its mistaken belief
that the issue could be deferred pending completion of the appeal
in Barrow. The only other stated reason for denial was that the
issue of venue presented "a fairly close jurisdictional question,"
and that "there was no vexatious action by either party." These
factors are relevant to the issue of whether Green's choice of an
improper venue should have been cured by transferring venue rather
than dismissing the Anchorage appeal without prejudice. [Fn. 12]
But these factors have only limited bearing on the issue of whether
NSB should have been awarded fees or costs. Appellate Rule 508
does not purport to restrict fees and costs to cases involving
vexatious litigation or meritless claims.
IV. CONCLUSION
Because the superior court applied an incorrect standard,
we VACATE its order denying costs and fees to NSB, and we REMAND
for reconsideration of NSB's motion under Appellate Rule 508(a),
(d) and (e). If the court again denies NSB's motion, it should
fully explain its decision. [Fn. 13]
FOOTNOTES
Footnote 1:
We express no view as to whether Alaska Civil Rule 3 and
AS 22.10.040 generally apply for purposes of determining the proper
venue for commencement of an administrative appeal.
Footnote 2:
See Ko-Am Enters. v. Davis, 657 P.2d 399, 400 (Alaska 1983)
(indicating that transfer of venue, rather than dismissal, is
ordinarily the preferred remedy).
Footnote 3:
See 15 Charles Alan Wright et al., Federal Practice and
Procedure sec. 3827, at 277-78 (2d ed. 1986) ("If the court
dismisses
the action [for lack of venue] this is of course a final judgment
and appealable as such."). Cf. Stahlman v. State, 856 P.2d 1162,
1165 (Alaska 1993) (noting that, where a "dismissal without
prejudice"effectively imposes legal prejudice on the plaintiff,
the dismissal is appealable).
Footnote 4:
See Appellate Rule 508(a), (e), and (f) (implying that award
of appellate costs and fees coincides with final disposition of the
appeal). Cf. Ko-Am Enters., 675 P.2d at 401 n.2 (stating that
where the superior court dismisses an appeal rather than
transferring venue, an award of costs "may be appropriate").
Footnote 5:
See Aleut Corp. v. Rogers, 619 P.2d 472, 473 (Alaska 1980)
(per curiam) (dismissal without prejudice is final appealable
judgment); see also AS 22.05.010(c) ("A decision of the superior
court on an appeal from an administrative agency decision may be
appealed to the supreme court as a matter of right."); Alaska R.
App. P. 204(a)(5)(a) ("If no appeal or cross-appeal is pending, the
allowance of costs and attorney's fees . . . shall be considered a
final judgment subject to separate appeal limited to the subject of
costs, attorney's fees . . . .").
Footnote 6:
Had NSB failed to appeal the Anchorage superior court's March
17 order denying fees and costs, the order would no longer have
been subject to challenge and would have been binding on the court
in Barrow. Moreover, the Barrow court would have had no basis for
awarding fees and costs for activities in the Anchorage case,
because it would have no record basis upon which to act.
Footnote 7:
565 P.2d 175 (Alaska 1977).
Footnote 8:
Id. at 179.
Footnote 9:
Id.
Footnote 10:
See Stalnaker v. Williams, 960 P.2d 590, 597 (Alaska 1998)
(superior court hearing appeal from administrative agency awards
attorney's fees under appellate rule instead of rule of civil
procedure); Cook Inlet Pipe Line Co. v. Alaska Pub. Utils. Comm'n,
836 P.2d 343, 348 (Alaska 1992) (stating that review of award of
attorney's fees is limited to abuse of discretion); Rosen v. State
Bd. of Pub. Accountancy, 689 P.2d 481-82 n.6 (Alaska 1984) (per
curiam) (noting that awards under Alaska Appellate Rule 508(e) are
within superior court's discretion). We note, however, that
Appellate Rule 508(a) limits the court's discretion to award costs
in cases of dismissal: "If an appeal is dismissed or petition
denied by the appellate court, costs shall not be allowed to the
appellee or respondent, unless otherwise ordered by the court."
Footnote 11:
See Rosen, 689 P.2d at 480 (quoting Conway, Inc. v. Ross, 627
P.2d 1029, 1032 (Alaska 1981)).
Footnote 12:
Cf. Ko-Am Enters. v. Davis, 657 P.2d at 400 (noting that
dismissal may be appropriate if litigant acted in bad faith).
Footnote 13:
In light of our decision vacating and remanding the superior
court's costs and fees order, we find no merit in Green's
reciprocal request for costs and attorney's fees for defending this
appeal.
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