Kennedy v. United States
Decision Date | 25 March 1982 |
Docket Number | Civ. No. 80-258-D. |
Citation | 542 F. Supp. 1046 |
Parties | Mary F. KENNEDY v. UNITED STATES of America, et al. |
Court | U.S. District Court — District of New Hampshire |
Paul McEachern, Portsmouth, N. H., for plaintiff.
W. Stephen Thayer, III, U. S. Atty., Concord, N. H., John P. McAllister, Tax Div., Dept. of Justice, Washington, D. C., for defendant.
Betty J. Ardini, pro se.
William F. Ardini, pro se.
This matter is currently before the Court following hearing1 on dual issues: (1) the right of the plaintiff to recover attorney's fees pursuant to the pertinent provisions of the "Equal Access to Justice Act", 28 U.S.C. § 2412(d)(1)(A); and (2) the order of judgment to be entered herein. We consider these issues in the order set forth.
1. Attorney's Fees
Commenced by the plaintiff, Mary Kennedy, as an action to quiet title to certain real estate, the scope of this litigation expanded when the Government sought by counterclaim to set aside as fraudulent certain conveyances in the plaintiff's chain of title.2 The first such conveyance occurred on March 6, 1964, when William F. Ardini, who then held record title to the real estate, quit-claimed his interest therein to his then wife, Betty J. Ardini. The second transfer took place on October 9, 1967, when Betty J. Ardini transferred her interest in the premises to the plaintiff herein.
Following trial, the Court ruled3 that the initial transfer between William and Betty Ardini was not fraudulent, but that the second transfer between Betty Ardini and the plaintiff herein was fraudulent. Accordingly, plaintiff here contends that she "prevailed" on the issue of the first transfer, and, having won at least as to part of the counterclaim, she is entitled to attorney's fees.
Added to the statutory scheme as a portion of P.L. 96-481, the "Equal Access to Justice Act" applies to civil actions which are pending on or commenced on or after October 1, 1981, and as here pertinent, provides:
Except as otherwise specifically provided by statute, a court shall award to a prevailing party other than the United States fees and other expenses in addition to any costs awarded pursuant to subsection (a), incurred by that party in any civil action (other than cases sounding in tort) brought by or against the United States in any court having jurisdiction of that action, unless the court finds that the position of the United States was substantially justified or that special circumstances make an award unjust.
As the legislative history makes clear, the burden of proof under the aforesaid statute is upon the Government to prove that its action was "substantially justified or that special circumstances make an award unjust".
H.R.Rep.No.96-1418, 96th Cong., 2d Sess. 10-11 reprinted in (1980) U.S.Code Cong. & Ad.News 4953, 4989-90.
While it is clear that, as the instant action was pending on the effective date of the statute, the award would be authorized for services rendered prior to such effective date, Photo Data, Inc. v. Sawyer, 533 F.Supp. 348 (D.D.C.1982), it is similarly clear that application of the above test requires the Court to rule, as it does herein, that the defendant has carried its burden of proving that its action was "substantially justified".
While plaintiff makes much of the fact that seventeen years elapsed from the date of first transfer and the challenge thereto, she overlooks the thirteen years of time lapse between the second (found fraudulent) transfer and its successful challenge. While it is true that the Court found against the Government as to the first transfer, the Court herewith finds and rules that the Government was not unreasonable in pursuing the litigation — that, based on the "badges of fraud" argument which it presented (although not adopted by the Court), it was justified in proceeding with this litigation.4
In short, application of the test of "reasonableness" requires denial of plaintiff's motion for attorney's fees pursuant to 28 U.S.C. § 2412(d)(1)(A).5
Having so ruled, we find it unnecessary to discuss the issue of whether there are special circumstances in the instant case which would render an award of attorney's fees unjust. However, while we concur with the defendant in its contention that the costs to be herein awarded to plaintiff are limited to those set forth in 28 U.S.C. §§ 1920, 1923,6 we are satisfied with and accept the argument of plaintiff that the travel and telephone costs set forth in her purported bill of costs are costs "incident to depositions". Accordingly, we deny defendant's motion to amend the bill of costs by striking therefrom the item of travel and telephone costs and approve the bill of costs in the amount of $327.96 as originally filed by plaintiff herein.
II. The Order Of Judgment
Defendant's proposed order of judgment filed in accordance with instructions of the Court set forth (pp. 13, 14 in its Opinion of February 2, 1982) has drawn objection from plaintiff and from third-party defendant Betty J. Ardini primarily on the ground that its computation of the unpaid federal income taxes to be recovered of Betty J. Ardini is incorrect in that it includes a penalty which has been incorrectly and improperly assessed. Betty J. Ardini has filed an affidavit purporting to demonstrate that "reasonable cause" exists for failure by her to pay her 1975 income taxes, which "reasonable cause" justifies relief from the penalties as assessed.
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