Dockins v. State Farm Ins. Co.

• Decision Date: 24 February 2000
• Citation: 330 Or. 1,997 P.2d 859
• Parties: Troy DOCKINS and Donna Dockins, Petitioners on Review, v. STATE FARM INSURANCE COMPANY, a corporation, Respondent on Review.
• Court: Oregon Supreme Court

997 P.2d 859

330 Or. 1

Troy DOCKINS and Donna Dockins, Petitioners on Review, v. STATE FARM INSURANCE COMPANY, a corporation, Respondent on Review.

(CC 9605-03556; CA A98608; SC S45747)

Supreme Court of Oregon.

February 24, 2000.

On Petition for Attorney Fees filed Sept. 24, 1999.¹

William A. Drew, Portland, filed the petition for petitioners on review. With him on the petition were Robert E.L. Bonaparte, and Bonaparte, Elliott, Ostrander & Preston, P.C., Portland.

Michael A. Lehner, of Lehner, Mitchell, Rodrigues & Sears, Portland, filed the opposition to the petition for respondent on review.

Before CARSON, Chief Justice, and GILLETTE, VAN HOOMISSEN, DURHAM, KULONGOSKI, and LEESON, Justices.²

GILLETTE, J.

Last year, this court decided Dockins v. State Farm Ins., 329 Or. 20, 985 P.2d 796 (1999), a case involving an action on an insurance policy. Petitioners were plaintiffs in that action. They prevailed on appeal, thereby establishing their right to collect "reasonable" attorney fees from defendant insurer (respondent) under ORS 742.061. Petitioners now seek a specific amount of fees—$41,513.12—for the work their lawyers performed in the course of that appeal. Respondent opposes the petition for attorney fees, arguing that the amount requested is unreasonable and that a sum of $15,000 would be appropriate. For the reasons that follow, we award to petitioners the amount that they have requested.

In 1992, petitioners became embroiled in a dispute with respondent over coverage for damage caused by a leaking underground oil tank located on their property. Dockins, 329 Or. at 22-25, 985 P.2d 796. Petitioners approached a law firm (petitioners' lawyers), who agreed to represent them in the dispute on a "contingent" fee basis.³ The contingent fee agreement contemplated two possible scenarios: (1) an early settlement that would include some amount for attorney fees or (2) a more significant award of "reasonable" attorney fees under ORS 742.061 if petitioners prevailed after more protracted litigation.⁴

Respondent initially declined to settle the dispute. Petitioners then filed their action. Approximately eight months after the action was filed, respondent offered to settle with petitioners for $15,000, but expressly excluded any additional amount for attorney fees. Petitioners accepted that offer as settlement of the underlying insurance claim, but only after respondent agreed to litigate the issue of petitioners' entitlement to attorney fees.

Subsequently, petitioners petitioned the trial court for an award of attorney fees, and respondent opposed their petition. The trial court denied the petition, concluding that petitioners were not entitled to attorney fees under ORS 742.061. Petitioners appealed and, eventually, obtained review by this court. We reversed the trial court's denial of the petition and held that petitioners were entitled to attorney fees under ORS 742.061, because their recovery exceeded the amount of any timely tender by respondent. Dockins, 329 Or. at 34, 985 P.2d 796.

Our earlier opinion in Dockins involved only the trial court's denial of petitioners' petition for attorney fees at that level. We remanded the case to that court to award a reasonable amount for the efforts of petitioners' lawyers at that level. Id. at 35, 985 P.2d 796. However, ORS 742.061 also provides for reasonable attorney fees on appeal. The present petition pertains to fees on appeal and, as noted, seeks an award of $41,513.12.

Petitioners explain their $41,513.12 request as follows: For each lawyer and legal assistant who worked on petitioners' appeal, petitioners have multiplied the number of hours they billed by a "reasonable hourly rate," which is based on the respective lawyer's or assistant's standard rate for the work at issue.⁵ When the total fees for each lawyer and legal assistant are added, the result is the amount requested.

As factual support for their request, petitioners' lawyers have submitted detailed records documenting their individual time expenditures on various appeal-related activities⁶ and a verified statement⁷ in which they assert that they ordinarily charge paying clients between $150 and $200 per hour for their work, that the prevailing market rate for similar legal work is between $150 and $275 per hour, and that the claimed hours and hourly rates are reasonable in light of six relevant factors: (1) the novelty and difficulty of the question involved; (2) the skills needed to perform the work properly; (3) the fees customarily charged for similar legal services; (4) the result obtained (which they describe as having "preserved a meaningful right to [the] attorney fees * * * provided by ORS 742.061"); (5) their experience, reputation and abilities; and (6) the fact that they devoted a substantial amount of time to the case on a contingent fee basis.

The six factors identified by petitioners as supporting the reasonableness of their request are in fact items that this court considers in determining an appropriate attorney fee award. The factors are drawn from Disciplinary Rule (DR) 2-106 of the Code of Professional Responsibility, which sets out factors that bear on the reasonableness of an attorney's fee. This court has indicated that the factors enumerated in DR 2-106 are relevant in determining a reasonable attorney fee under ORS 742.061.⁸See, e.g., Chalmers v. Oregon Auto. Ins. Co., 263 Or. 449, 455, 502 P.2d 1378 (1972) (so stating).⁹ Therefore, to the extent that those listed factors (including the ones relied upon by petitioners) are relevant, we ordinarily include them in our analysis. In addition, because this petition pertains to fees for prosecuting an appeal in this court, we ordinarily consider the extent to which counsel's written and oral arguments assisted the court in reaching a decision. Id. at 456, 502 P.2d 1378.

Respondent does not deny that petitioners are entitled to some award of attorney fees. Neither does it challenge the actual amount of time expended or question whether the time was devoted to the tasks reported by petitioners. As noted, it challenges only the reasonableness of the amount of time expended and the hourly rates that are claimed for that time. We turn to a discussion of those factors that relate to the reasonableness of time expended and hourly rate charged.

In determining a reasonable attorney fee, our analysis largely will be framed by the opponent's objections to a petitioner's request. We depend on a petitioner's opponent to raise objections to the petitioner's request with as much particularity as possible and to support those objections with argument and (where appropriate) documentation that will assist this court in its efforts.¹⁰ See McCarthy v. Oregon Freeze Dry, Inc., 327 Or. 185, 189, 957 P.2d 1200 (1998) (on reconsideration) (holding, in context of discretionary decision by Court of Appeals to award an attorney fee, that "the objections of a party who resists a petition for attorney fees plays an important role" in court's decision).

We turn to respondent's first objection—that petitioners' lawyers have claimed an excessive and, therefore, unreasonable, number of hours. Petitioners' lawyers claim to have spent 193.8 hours on the appeal (including 19 hours of legal assistant time) and have submitted documentation that accounts for that time and the matters attended to on a daily basis. As noted, respondent does not question the accuracy of petitioners' documentation, but suggests that the time expended by petitioners' lawyers on the case was unreasonable in light of (1) the disproportionality between the time claimed by petitioners' lawyers and the time expended on the same matter by respondent's own lawyer,¹¹ (2) the fact that the case was not particularly complex, i.e., "it required the court to construe a single statute," and (3) the claims made by petitioners' counsel of substantial experience in litigating and appealing insurance coverage disputes.

The latter two objections require little discussion. Although this case certainly is not among the most difficult cases that this court has heard in recent years, neither is it among the simplest. And, although the hours claimed by petitioners' lawyers might lie toward the high end of the range of hours that are claimed in ordinary appeals of moderate difficulty by experienced, competent counsel, they are not patently outside that range.

Neither are we persuaded by respondent's disproportionality argument. Although it might be useful to compare the hours claimed by a petitioner's lawyer with those of lawyers arguing similar positions in similar cases, respondent is not offering such a comparison here. As respondent's lawyer acknowledges, an appellant's task might be more difficult than that of a respondent. An appellant's counsel reasonably might devote more time to an appeal as a consequence. Respondent has not made a sufficient showing that the amount of time expended in this case lies outside the permissible range. We accept the claimed time expenditure, 193.8 hours, as reasonable.

Respondent also objects to the reasonableness of the various hourly rates sought by petitioners' lawyers in their petition. In support of that objection, respondent's lawyer avers that, (1) "in [his] experience, lawyers practicing in insurance law do not obtain the hourly rates sought by petitioners in this case;" (2) his own billing rate for appellate work is lower; and, (3) in his opinion, a reasonable hourly rate for petitioners' lawyers in this case is significantly lower than those sought by petitioner's lawyers.

The first and last assertions are of limited assistance in determining the reasonableness of...