Capital Properties, Inc. v. City of Providence

• Decision Date: 30 January 2004
• Docket Number: No. 2001-596-Appeal.,2001-596-Appeal.
• Citation: 843 A.2d 456
• Parties: CAPITAL PROPERTIES, INC. v. CITY OF PROVIDENCE et al.
• Court: Rhode Island Supreme Court

843 A.2d 456

CAPITAL PROPERTIES, INC. v. CITY OF PROVIDENCE et al.

No. 2001-596-Appeal.

Supreme Court of Rhode Island.

January 30, 2004.

Gerald John Petros, Esq., Providence, for Plaintiff.

Caroline Cole Cornwell, Esq., Providence, for Defendant.

Present: WILLIAMS, C.J., FLANDERS, GOLDBERG, FLAHERTY, and SUTTELL, JJ.

OPINION

SUTTELL, Justice.

A Superior Court award of attorneys' fees brings this protracted controversy before this Court for the third occasion. The defendant, City of Providence (the city), appeals from an award of costs and attorneys' fees to the plaintiff, Capital Properties, Inc. (CPI). The city asserts that the motion justice erred in his interpretation of both Rhode Island and federal statutory law, and by finding that the court has the inherent authority to award attorneys' fees. For the reasons stated herein, we affirm the judgment of the Superior Court.

Facts and Procedural History

The genesis of this litigation is a civil action filed by CPI in 1988, seeking a determination of the fair market value of property condemned by the State of Rhode Island (the state) for the Providence River Relocation-Memorial Boulevard Extension Project. CPI was awarded condemnation damages in the amount of $10,653,328.03. The state thereafter filed a declaratory judgment complaint to determine the contractual rights and obligations of the city, state, and CPI, with respect to payment of the final judgment in the condemnation case. This action resulted ultimately in a determination that the state and the city were each contractually obligated to pay one-half of the total award.

Approximately three months after CPI was awarded condemnation damages, it received tax bills from the city reflecting large increases in the valuations of ten parcels that CPI owned as of December 31, 1996. Essentially, the city reassessed CPI's property solely based upon the condemnation value of $110 per square foot as determined by the Superior Court.¹ Two weeks later, the city mailed additional bills to CPI, applying the increased valuations retroactively to years 1991 through 1995. The reassessed values were also carried forward to the tax assessment of December 31, 1997.

CPI filed two complaints against the city, alleging that its property was revalued in a selective and discriminatory manner for the years 1991 through 1997 and that the levy of approximately $7.9 million in new taxes was improper. While these suits were pending, the city also issued tax sale notices to CPI dated January 28, 1999, that said, "the Real Estate in the City [] assessed in your name on December 31, 1997 and prior will be offered for Tax Sale at Public Auction on June 3, 1999" in an effort to collect the purported back taxes owed and accrued interest thereon.

On December 16, 1998, CPI filed a third complaint against the city, alleging that the city condemned a parcel that CPI owned, referred to as Parcel 9, in violation of the Redevelopment Act, G.L.1956 chapters 31 to 33 of title 45.

On December 3, 1998, this Court consolidated all matters pending between the parties before a single justice of the Superior Court with directions to "hear, and decide all claims and defenses, including, but not limited to, title to [P]arcel 9, alleged unpaid taxes owed by CPI to the city, any agreements between the city and the state, and any further unresolved claims between the parties." Capital Properties, Inc. v. State, 726 A.2d 12, 12 (R.I.1998) (mem.) (Capital Properties I.)

The four civil actions CPI filed were heard by the motion justice on cross-motions for summary judgment. In a written decision, he determined that the state was contractually bound to pay the full condemnation award to CPI, but that the city was obligated to reimburse the state one-half the final judgment. He further entered summary judgments in favor of CPI on all its complaints against the city, finding that the city's increased assessments and imposition of taxes retroactively were "selective, arbitrary, and illegal." He then ordered the city to "expunge all real property tax assessments and reassessments based on the $110.00 per square foot market value as determined in the condemnation proceeding." He further found that the city's condemnation of Parcel 9 was "arbitrary, capricious and done in bad faith."

On appeal, we held that the "appeals by the state, the city, and the Providence Redevelopment Agency [were] without merit," and adopted the motion justice's decision as our own.² Capital Properties, Inc. v. State, 749 A.2d 1069, 1073 (R.I. 1999) (Capital Properties II.)

On July 14, 2000, six months after remand to the Superior Court, CPI filed a motion for reasonable costs and attorneys' fees. A second motion justice (the first motion justice having deceased) granted the motion in a written decision filed on October 26, 2000. Thereafter, the second motion justice held a hearing to determine the amount of the costs and fees in issue, and awarded $258,375.11 to CPI in a written decision on November 6, 2001. The city timely appealed, arguing that the motion justice erred by considering the fee request because it was not filed in a timely manner, erred in his statutory interpretation of both state and federal law, and also erred in holding that the court has the inherent powers to award attorneys' fees.³

Discussion

"It is well settled that attorneys' fees may not be appropriately awarded to a prevailing party absent contractual or statutory authorization." Insurance Company of North America v. Kayser-Roth Corp., 770 A.2d 403, 419 (R.I.2001). As no contractual predicate exists for an award of attorneys' fees to CPI, any authority for such an award must necessarily derive from either statute or this Court's inherent equitable powers. See Vincent v. Musone, 574 A.2d 1234, 1235 (R.I.1990) (per curiam)

; Cheetham v. Cheetham, 121 R.I. 337, 342, 397 A.2d 1331, 1334 (1979).

The motion justice based his decision awarding attorneys' fees upon the following four grounds: (1) a Superior Court judgment in a distinct but similar action was persuasive precedent under the principle of stare decisis; (2) the provisions of G.L.1956 § 44-7-12(b), which permit the court to "award a reasonable attorney's fee to the prevailing party in any civil action arising from the collection of a municipal tax levy * * * "; (3) the inherent authority of the Superior Court to award attorneys' fees in the interests of justice; and (4) the provisions of 42 U.S.C. § 1988, which authorizes attorneys' fees to a party that successfully has vindicated a federal constitutional or statutory claim.

Timeliness

Initially, the city argues that CPI's request for attorneys' fees is untimely, and the lateness of its filing "precludes even the consideration of the award of an attorney fee to CPI." CPI filed its "Motion for Costs and Attorneys' Fees" on July 14, 2000, fully one year after summary judgments were entered, nearly ten months after final judgments were entered under Rule 54(b) of the Superior Court Rules of Civil Procedure, and six months after we remanded the case to the Superior Court "for issuance of execution on the summary judgments already rendered and for further proceedings relating to issues that are still pending before the Superior Court in respect to the parties to this litigation." Capital Properties II, 749 A.2d at 1073.

CPI counters that the city never presented this "lateness" argument to the motion justice, thereby precluding appellate review. We repeatedly have said that we will not address issues for the first time on appeal. In re Damien M., 819 A.2d 213, 213-14 (R.I.2003) (mem.). A review of the record reveals that the city indeed raised a timeliness issue before the award of attorneys' fees. The city's assertion, however, was that CPI's motion was "premature." The city contended that the federal constitutional claims raised by CPI in its complaints had been severed before the motions for summary judgment were heard, and therefore "attorneys' fees and costs are simply not ripe for consideration * * * before it has been fully litigated." Only after the motion justice granted CPI's motion for costs and attorneys' fees did the city assert in a "Motion for Clarification/Reconsideration of the Decision of October 26, 2000" that CPI had made its request too late.

The Superior Court Rules of Civil Procedure do not provide for a motion to reconsider. Assuming, however, without deciding, that an issue presented for the first time in a motion to reconsider is properly preserved for appellate review, we hold that CPI's request for costs and attorneys' fees was timely made.

The city advances several theories to support its untimeliness argument. First, it asserts that only the justice who presided at the trial has the discretion to award attorneys' fees, and in this case the trial justice died before CPI filed its motion seeking costs and attorneys' fees. Secondly, the city contends that CPI, by not objecting to the city's motion for certification of finality pursuant to Rule 54(b), effectively conceded that there existed "no just reason for delay of entry of final judgment," and thereby waived any opportunity to seek attorneys' fees.

These arguments to support the city's position that CPI's request was too tardily filed are predicated upon the assumption that the consideration of an award of attorneys' fees was inextricably linked to the merits of the claims litigated between the parties. We conclude, rather, that the issue of entitlement to attorneys' fees required a separate inquiry distinct from the resolution of the underlying claims. CPI's motion for costs and attorneys' fees raised issues that were collateral to, albeit closely connected with, the main causes of action, and was an independent claim that did not arise under either § 44-7-12(b) or 42 U.S.C. § 1988 until CPI was determined to be the prevailing party. Thus, the inquiry need not commence until the underlying cause of...