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You can search the entire site. or go to the recent opinions, or the chronological or subject indices. Wagner v. Wagner (05/23/2008) sp-6268
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,
e-mail corrections@appellate.courts.state.ak.us.
THE SUPREME COURT OF THE STATE OF ALASKA
| GREGORY WAGNER, | ) |
| ) Supreme Court No. S- 12306 | |
| Appellant, | ) |
| ) Superior Court No. 4FA-03-00181 CI | |
| v. | ) |
| ) O P I N I O N | |
| RICHARD WAGNER, | ) |
| ) No. 6268 May 23, 2008 | |
| Appellee. | ) |
| ) | |
Appeal from the Superior Court of the State
of Alaska, Fourth Judicial District,
Fairbanks, Mark I. Wood, Judge.
Appearances: John J. Connors, Law Office of
John J. Connors, P.C., Fairbanks, for
Appellant. No appearance by Appellee.
Before: Fabe, Chief Justice, Matthews,
Eastaugh, Carpeneti, and Winfree, Justices.
FABE, Chief Justice.
I. INTRODUCTION
A father breached a contract with his son to share oil
revenues with him in consideration for the sons co-signing a
$1.025 million bank loan. Following a jury trial, the son
obtained a partial final judgment for back payment and an Alaska
Rule of Civil Procedure 82(b)(1) attorneys fees award. The son
also received a partial final judgment for specific performance
and a Rule 82(b)(2) attorneys fees award. The son appeals the
Rule 82(b)(2) attorneys fees award. Because the partial final
judgment for specific performance was not a money judgment, the
superior court properly relied on Rule 82(b)(2), and therefore we
affirm the superior courts award of attorneys fees.
II. FACTS AND PROCEEDINGS
Richard Wagner owns oil and gas leases on the North
Slope and in Cook Inlet. His royalty interests are valued at
between $7.572 and $19.559 million. He filed for bankruptcy in
1988, and as of 2001 still owed substantial sums to his
creditors. In December 2001 Richard and his son Gregory Wagner
agreed that Gregory would co-sign for a $1.025 million loan from
Northrim Bank to Richard, with the funds to be used to satisfy
one of Richards creditors. In consideration for Gregory making
his own credit available and pledging the real estate he and his
wife owned as collateral for the loan, Gregory and Richard agreed
that Gregory would be entitled to at least $2,500 per month from
Richards oil royalties.
For several months, Richard made no payments to
Gregory, and on November 25, 2002, Gregory sent his father a
demand letter. In response, Richard made two payments to
Gregory, the first in December 20021 and the second in January
2003.2 Richard made no further payments, and Gregory filed a
complaint for specific performance in superior court on January
24, 2003.3 A jury trial was held before Judge Mark I. Wood in
August 2005. The jury found that an oral agreement existed,
outlined the basic terms of that agreement,4 found that Richard
had breached the agreement, determined that Richard owed Gregory
$139,180.89 in back payments, and concluded that Richards
obligation to share royalties per the terms of the agreement
would continue until production on wells ends. The trial court
heard oral argument on the specific performance claim on November
10, 2005.
Judge Wood issued a partial final judgment for
$182,130.06 against Richard on November 14, 2005. This amount
included the $139,180.89 in back payments that the jury had
determined Richard owed Gregory, $10,160.33 in prejudgment
interest, $17,434.12 in attorneys fees, and $15,354.72 in costs.
On December 23, 2005, Judge Wood issued a partial final judgment
for specific performance, requiring Richard to perform his
obligations under the agreement found by the jury and including
an award for $33,300.30 in attorneys fees. Judge Wood calculated
attorneys fees under the partial final judgment for back payment
using Rule 82(b)(1) and relied on Rule 82(b)(2) to calculate the
attorneys fees award for the partial final judgment for specific
performance.
Gregory appeals the attorneys fees awarded in the
partial final judgment for specific performance.
III. DISCUSSION
A. Standard of Review
We review awards of attorneys fees for an abuse of
discretion5 and will only reverse if the award is arbitrary,
capricious, manifestly unreasonable, or stemmed from improper
motive.6 We consider de novo whether the trial court should have
applied Rule 82(b)(1) or Rule 82(b)(2) in calculating the fee
award.7
B. The Superior Court Applied the Appropriate Attorneys
Fees Schedule to Gregorys Partial Final Judgment for
Specific Performance.
Gregory contends that the superior court erred by
calculating the attorneys fees award for the partial final
judgment for specific performance under Rule 82(b)(2).8 He
argues that the trial courts reliance on Rule 82(b)(2) was
misplaced because the partial final judgment for specific
performance was a monetary judgment. He maintains that because
the present value of his prospective recovery under the judgment
is $2.125 million,9 Civil Rule 82(b)(1) fees of . . . $212,500
are thus payable.
We disagree. In Dillingham Commercial Co. v. Spears,10
we recognized that the superior court erred in applying the fee
schedule applicable to money judgments11 to a judgment for
specific performance of an option contract.12 We specifically
indicated that [r]esort to the schedule of attorneys fees set
forth in Civil Rule 82(a)(1) was inappropriate since Dillingham
did not receive a money judgment.13 We have defined money
judgment for attorneys fees purposes as a judgment in which money
change[s] hands.14 Gregorys partial judgment for specific
performance was an equitable remedy,15 not a money judgment. The
superior court appropriately applied Rule 82(b)(2) to Gregorys
motion for attorneys fees under his partial judgment for specific
performance.
C. The Superior Court Did Not Deviate from the Schedule in
Rule 82(b) in Its Award of Attorneys Fees.
Gregory argues in the alternative that the superior
court erred in calculating its award of attorneys fees for the
judgment for specific performance. Gregory maintains that under
Rule 82(b)(2), he was entitled to thirty percent of his
reasonable actual attorneys fees,16 which totaled $169,115, and
contends that the award did not conform to this schedule.
Gregory also contends that the superior court provided no
explanation for its deviation from the schedule listed in Rule
82(b)(2).
We disagree. Gregorys attorneys fees were awarded in
two phases: the first covered the $161,284 in fees incurred from
January 2003 through November 30, 2005. Under Rule 82(b)(2),
Gregory was entitled to thirty percent of his total attorneys
fees for that first phase, or $48,385.20, for the partial
judgment on specific performance.17 However, had Judge Wood
awarded this amount, Gregory would have enjoyed a double recovery
because Gregory had already recovered $17,434.12 in attorneys
fees in November 2005 on the partial final judgment for back
payment. Instead, the superior court subtracted the earlier
award, leaving an award of $30,951 for fees incurred through
November 2005 for work related to the judgment for specific
performance.
The second phase covered fees incurred in December
2005. The superior court anticipated the need for an additional
attorneys fees award when it made its award for the first phase:
This award is for billings through 11/30/05. Gregory Wagner is
entitled to 30% of reasonable, actual attorneys fees from
11/30/05 through 12/23/05 (the dates of judgment) in addition to
the above figure. Counsel for Gregory Wagner shall submit their
affidavits for that period and another judgment for attorneys
fees.
When Gregory filed his supplemental motion for
attorneys fees for work performed during December 2005, he
indicated that he had incurred $7,831.00 in fees during this
period. Thirty percent of that total is $2,349.30.18 When added
to the award of $30,951 on the judgment for specific performance
through November 30, 2005, the Rule 82(b)(2) fees total
$33,300.30, and this is exactly what Judge Wood awarded. When
added to the Rule 82(b)(1) award of $17,434.12 on the judgment
for back payment, the fees total $50,734.42, which amounts to
thirty percent of the total fees expended in the litigation
$169,115.
Because the superior court adhered strictly to the
formula of Rule 82(b)(2) in its award of attorneys fees, it
committed no error.
IV. CONCLUSION
We AFFIRM the superior courts fee award in all
respects.
_______________________________
1 This payment was for $24,419.13 and was sent along with
a spreadsheet from [Richards] accountant which purported to
calculate the payments owed under the agreement. While
acknowledging the contract terms, [Richard] suggested that the
agreement had been hastily written and required some
clarifications. Neither Gregory nor Richard ever took steps to
modify or clarify their agreement.
2 The second payment was for $3,875.72.
3 Gregory eventually filed two amended complaints listing
additional claims against Richard, including a claim for back
payment.
4 In response to the question, [W]hat were the terms of
that agreement?, the jury answered, In exchange for getting a
$1,025,000 loan from Northrim Bank to repay Richard Wagners debt
at Key Bank, Gregory Wagner will receive a share of profits from
Richard Wagners oil royalties. In its findings of fact, the
superior court described the agreement as follows:
Richard and Gregory agreed that the monthly
income from the oil royalties that secured
the Key Bank loan would be used first to pay
all required payments on the Northrim Bank
loan. The next $10,000 of monthly income
would be allocated $2,500 to Gregory and then
$7,500, or the balance, whichever was less,
to Richard. Anything over $10,000 would be
divided equally between them.
5 Ware v. Ware, 161 P.3d 1188, 1192 (Alaska 2007).
6 Id.; Strong Enters., Inc. v. Seaward, 980 P.2d 456, 458
(Alaska 1999).
7 Strong Enters., 980 P.2d at 458.
8 Rule 82(b)(1) applies to a party recovering a money
judgment in a case, while Rule 82(b)(2) applies to cases in which
the prevailing party recovers no money judgment.
9 Gregory calculated this value by taking $9,068,608, one
estimate of the discounted present day value of Richards oil
royalties, subtracting the approximately $500,000 required to
retire the Northrim Bank debt (which, he calculated, left the
value of the royalties at $8.5 million), and dividing $8.5
million by 25%, which Gregory contends is his share of the
royalties, for a total of $2.125 million.
10 641 P.2d 1 (Alaska 1982).
11 This schedule is now contained in Rule 82(b)(1), but at
the time Dillingham was decided, this schedule was in Rule
82(a)(1). Russell v. Criterion Ins. Co., 917 P.2d 664, 665 n.2
(Alaska 1996).
12 Spears, 641 P.2d at 10 n.16.
13 Id.
14 Atl. Richfield Co. v. State, 723 P.2d 1249, 1252
(Alaska 1986); see also Strong Enters., 980 P.2d at 458.
15 Oaksmith v. Brusich, 774 P.2d 191, 197 (Alaska 1989)
(citing Hall v. Add-Ventures, Ltd., 695 P.2d 1081, 1087 (Alaska
1985)); Blacks Law Dictionary 1435 (8th ed. 2004) (Specific
performance is an equitable remedy.).
16 The rule indicates that [i]n cases in which the
prevailing party recovers no money judgment, the court shall
award the prevailing party in a case which goes to trial 30
percent of the prevailing partys reasonable actual attorneys fees
which were necessarily incurred.
17 $161,284 x .30 = $48,385.20.
18 $7,831 x .30 = $2,349.30.
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