Dipaola v. Mun. Police Employees' Ret. Sys.

• Decision Date: 25 September 2014
• Docket Number: No. 2014 CA 0037.,2014 CA 0037.
• Parties: Gasper W. DIPAOLA v. THE MUNICIPAL POLICE EMPLOYEES' RETIREMENT SYSTEM.
• Court: Court of Appeal of Louisiana — District of US

155 So.3d 49

Gasper W. DIPAOLA
v.
THE MUNICIPAL POLICE EMPLOYEES' RETIREMENT SYSTEM.

No. 2014 CA 0037.

Court of Appeal of Louisiana, First Circuit.

Sept. 25, 2014.
Rehearing Denied Nov. 10, 2014.

155 So.3d 50

Robert E. Tarcza, James E. Thompson, III, New Orleans, LA, for Plaintiff–Appellee, Gasper W. Dipaola.

James C. Percy, Christopher D. Martin, David P. Borghardt, Baton Rouge, LA, for Defendant–Appellant, Municipal Police Employees' Retirement System.

Denise Nelson Akers, Baton Rouge, LA, for Defendant–Appellee, Employees' Retirement System of the City of Baton Rouge and Parish of East Baton Rouge.

155 So.3d 51

Before WHIPPLE, C.J., McCLENDON, and HIGGINBOTHAM, JJ.

Opinion

HIGGINBOTHAM, J.

This is an appeal from a trial court judgment awarding attorney fees. For the following reasons, we reverse.

BACKGROUND

Plaintiff, Gasper W. Dipaola, brought this action for attorney fees pursuant to a reservation of rights contained in the terms of a confidential settlement agreement that resolved a prior lawsuit between him and defendant, Municipal Police Employees' Retirement System (MPERS), and third-party defendant, Employees' Retirement System of the City of Baton Rouge and the Parish of East Baton Rouge (CPERS).¹ The original lawsuit involved a dispute concerning a miscalculation of Mr. Dipaola's years of service credits from his employment in the East Baton Rouge Parish Attorney's Office that resulted in an overpayment of retirement benefits.

It is undisputed that the miscalculation error occurred when CPERS and MPERS entered into a merger agreement, whereby certain member accounts and assets were transferred from one system to the other. Pursuant to the merger agreement, Mr. Dipaola's original account with CPERS was transferred to MPERS. Several years after the merger of the retirement systems took place and Mr. Dipaola had retired, it was discovered that some membership data errors had occurred in the data transmission at the time of the merger, including the overstatement of creditable service for Mr. Dipaola. According to MPERS, the miscalculation of creditable service caused MPERS to overpay Mr. Dipaola's retirement benefits. As a result, MPERS informed Mr. Dipaola of the error and that his monthly retirement benefit was being reduced to the correct sum. MPERS also requested that Mr. Dipaola refund the overpayments.

In response to MPERS' actions, Mr. Dipaola filed suit against MPERS, alleging that MPERS had breached its fiduciary duty by wrongfully, negligently, and arbitrarily reducing Mr. Dipaola's retirement benefits and wrongfully demanding that he

155 So.3d 52

return the alleged overpaid amounts. MPERS reconvened against Mr. Dipaola and filed a third-party demand against CPERS, who reconvened against MPERS. Mr. Dipaola also filed a third-party demand against CPERS. Although the actual settlement agreement is not of record, it is undisputed that pursuant to a pre-trial settlement agreement entered into between CPERS and Mr. Dipaola, all of Mr. Dipaola's claims against MPERS and CPERS were resolved, except his right to seek attorney fees. After the parties settled, Mr. Dipaola filed a motion for attorney fees, relying on the express language of La. R.S. 11:264.7.

Following a hearing on the motion, the trial court ordered MPERS to pay a total of $57,667.47 for attorney fees to Mr. Dipaola. MPERS appealed, insisting that the trial court erred in granting attorney fees to Mr. Dipaola since there was no evidence that MPERS was at fault, Mr. Dipaola was not a prevailing party, and the statutory authority did not apply. CPERS filed an answer to MPERS' appeal and aligned itself with MPERS, arguing that MPERS did not breach any fiduciary duty to Mr. Dipaola, who was not a prevailing party. Additionally, CPERS sought reversal of the attorney fees award, because the trial court failed to consider that the evidence revealed that CPERS was the only party at fault and the statutory authority relied on by Mr. Dipaola did not apply to CPERS. Mr. Dipaola also answered MPERS' appeal, seeking an increase in attorney fees for defending this appeal and requesting that a multiplier be applied to the trial court's award of attorney fees.

LAW AND ANALYSIS

The trial court is vested with considerable discretion in making an award of attorney fees, and the award will not be disturbed in the absence of a clear abuse of discretion. St. Tammany Parish Hosp. Service Dist. No. 2 v. Schneider, 2000–0247 (La.App. 1st Cir.5/11/01), 808 So.2d 576, 587. Under Louisiana law, attorney fees are not allowed except where authorized by statute or by contract. Pipeline Technology VI, LLC v. Ristroph, 2007–1210 (La.App. 1st Cir.5/2/08), 991 So.2d 1, 3, writ denied, 2008–1676 (La.10/24/08), 992 So.2d 1037, cert. denied, 556 U.S. 1106, 129 S.Ct. 1595, 173 L.Ed.2d 678 (2009). Thus, unless Mr. Dipaola can show a pertinent statute or contract providing for an award of attorney fees, such fees are not appropriate. It is undisputed that the parties' settlement agreement reserves “any and all claims [Mr. Dipaola] has to attorney fees” in the lawsuit involving Mr. Dipaola, CPERS, and MPERS.² Mr. Dipaola asserts that La. R.S. 11:264.7 is his statutory authority to be awarded attorney fees.

Title 11 of the Louisiana Revised Statutes contains provisions pertaining to “Consolidated Public Retirement Systems,” which apply to MPERS, but not CPERS. See La. R.S. 11:262. The special...