State v. Holder

• Decision Date: 09 May 1973
• Docket Number: Nos. 971S280 and 1071S295,s. 971S280 and 1071S295
• Citation: 36 Ind.Dec. 331,295 N.E.2d 799,260 Ind. 336
• Parties: STATE of Indiana, Appellant, v. Everett HOLDER et al., Appellees. STATE of Indiana, Appellant, v. Edward E. RENTCHLER et al., Appellees.
• Court: Indiana Supreme Court

Page 799

295 N.E.2d 799

260 Ind. 336

STATE of Indiana, Appellant, v. Everett HOLDER et al., Appellees.

STATE of Indiana, Appellant, v. Edward E. RENTCHLER et al., Appellees.

Nos. 971S280 and 1071S295.

Supreme Court of Indiana.

May 9, 1973.

Theodore L. Sendak, Atty. Gen., Stephen D. Clase, Deputy, Atty. Gen., Indianapolis, for appellant.

Donald G. Hendrickson, Boonville, for appellees.

DeBRULER, Justice.

These cases have been consolidated on appeal since they raise substantially the same questions. They are both appeals by the State in eminent domain proceedings from a portion of the final orders of the Warrick Circuit Court which awarded to the appellee-landowners, attorney, professional witness and trial preparation fees.

In July of 1969, the State of Indiana filed a complaint to condemn certain lands owned by appellee-Holder in order to make way for a highway. Appellee-Holder made no objections to this complaint and on August 14, 1969, the court appropriated the land and appointed appraisers. The appraisers found the appropriated land to be worth $8,335.90. The State then filed exceptions to that amount of September 11, 1969, and demanded a jury trial on the amount of damages. The appellants did not file exceptions.

Trial was set for May 28, 1970. On May 27th, the State filed a Motion for Withdrawal of Plaintiff's Exceptions which was granted over appellants' objections. Shortly thereafter the court awarded appellants the amount of damages recommended by the appraisers and further ordered the State to pay $500.00 in attorney fees and $100.00 for professional witness and trial preparation fees to the appellants.

In the Rentchler case the State filed its complaint for the appropriation of land on August 14, 1969. On August 29, 1969, the trial court ordered the appropriation of the Rentchler land and appointed three appraisers who returned a report showing damaging at $3,397.15. The State then filed its exceptions to the appraisers' report on September 17, 1969. On November 2, 1970, the State withdrew its exceptions to the appraisers' report and on that same day the court entered judgment on the amount shown in the original report. The court subsequently entered an additional order of an award of $500.00 to be paid by the State to appellees for their attorney fees. The State is appealing that part of these orders concerning the payment of the various fees for the appellees' professional services.

It is generally agreed that since costs were unknown at common law the right to their recovery is statutory and thus may be awarded by a court only when there is statutory authorization to do so. Stayner v. Bruce (1953), 123 Ind.App. 467, 110 N.E.2d 511. The Eminent Domain Act does contain such a section which also specifies how cost of a condemnation proceeding will be apportioned:

'The costs of the proceedings shall be paid by the plaintiff, except that in case of contest, the additional costs thereby caused shall be paid as the court shall adjudge.' IC1971, 32--11--1--10, being Burns § 3--1709.

Appellant contends, however, that attorney, expert witness and trial preparation fees are not 'costs' within the meaning of that term or this statute and hence the court's orders to pay these fees is without statutory authorization and erroneous.

A reading of this statute reveals that only a general reference to costs is made and there is no special definition provided as to what a court may consider as costs. It has long been established in this State, however, that the bare term 'costs' does not encompass attorney fees. Hutts v. Martin (1893), 134 Ind. 587, 33 N.E. 676. The majority of jurisdictions have agreed with this construction and it is widely held that the use of the word 'costs' in a statute is not intended to provide for the payment of attorney fees. 26 A.L.R.2d 1295; 27 Am.Jur.2d Eminent Domain § 476. It is apparent, therefore, that the court's awards of attorney fees to both defendants was without authorization by statute.

The State further objects to that part of the order in the Holder case which awards $100.00 to appellees for 'preparing for trial and paying for professional witnesses.' The State again contends that this type of expense is not intended to be includable in the word 'costs'. We agree. Although this is a question of first impression in this State we believe that the word 'costs' in this statute was not intended by the Legislature to cover every conceivable expense incurred by the appellees in this type of action, but is used in its ordinary sense and concerns only those usual and ordinary expenses of a trial which are prescribed by statute to be paid to the court.

The decision to retain expert witnesses to testify for the defendant in an eminent domain proceeding concerning damages is a decision left solely to the discretion of the defendant and the amount of professional charges to be paid to defendant's expert should be a matter between defendant and his witness. Likewise trial preparation expenses in a proceeding such as this (which might include mail, travel, telephone and photograph fees) are uniquely those of the individual party to the action and are not usually contemplated to be included in the statutory use of the word 'costs'. Manchester Housing Authority v. Belcourt (N.H.1971), 285 A.2d 364; State by Commissioner of Transportation v. Mandis (1972), 119 N.J.Super. 59, 290 A.2d 154; Frustuck v. Fairfax (1964), 230 Cal.App.2d 412, 41 Cal.Rptr. 56.

Appellee-Holder in this case attempts to assert error on the part of the trial court in allowing the State to withdraw its exceptions. The record here shows that the appellee-Holder did not file a motion to correct errors preserving those issues and consequently they cannot be considered on appeal. T.R. 59(G).

We therefore order the trial court to vacate that part of its final judgment in each case which required the State to pay appellees' attorney, trial preparation and expert witness fees, and we affirm the remainder of the judgment.

GIVAN, J., concurs.

PRENTICE, J., concurs with opinion.

ARTERBURN, C.J., dissents with opinion in which HUNTER, J., concurs.

PRENTICE, Justice (concurring).

I concur in the result and in the majority opinion; however, I think we should also respond to the contention presented by Appellants in both cases that the allowance of attorney's fees and witness' fees was permissible under Trial Rule 41(A)(2), IC 1971, 34--5--1--1. Such rule provides that except as provided in sub-section (1), '* * * an action shall not be dismissed at the plaintiff's instance save upon order of the court and upon such terms and conditions as the court deems proper. * * *.' (Emphasis ours). The terms and conditions of such a dismissal should ordinarily include the costs of the action. Harvey's Indiana Practice, Vol. 3, p. 216. Under the federal rules, expenses of the adversary, including reasonable attorney's fees have been allowed. Harvey (supra) p. 216, citing Wilson v. Jolly, D.C.Tex., (1948), 7 F.R.D. 649. The comments of the Civil Code Study Commission relative to this rule, however, indicate that the 'terms and conditions' are subject to the judicial and not to arbitrary discretion, and that in exercising its discretion, the court should follow the traditional principle that dismissals should be allowed unless the defendant will suffer some plain legal prejudice, other than the mere prospect of a second lawsuit. Harvey (supra) p. 212. Under this rule, in an appropriate case, the order of dismissal may be with prejudice. The withdrawal of its exceptions by the state amounted to a dismissal with prejudice, inasmuch as the statutory time for filing exceptions had elapsed. Had the exceptions not been withdrawn and the cause proceeded to trial upon the issue of damages, the defendant, nevertheless, could not have recovered its expenses of litigation as items of 'costs.' It is my view, therefore, that since such items were not recoverable, the order requiring their payment, as a condition of withdrawal, would not lie within the judicial discretion anticipated by the rule.

ARTERBURN, Chief Justice (dissenting).

I dissent from the majority in these cases which holds that the Court may not tax costs which include the expenses of preparing for trial, retaining expert witnesses and employing attorneys, where the plaintiff dismisses the proceedings, seemingly without justification.

In these cases the State brought condemnation actions for highway purposes. It filed exceptions to the reports of the appraisers, thus compelling the defendant-landowners to incur the expense of employing attorneys and expert witnesses. In Holder (971 S 280), the day before the jury trial was scheduled to begin, the State withdrew its exceptions and sought a dismissal over the defendant's objections. Thereupon, the court taxed as costs against the Plaintiff five hundred dollars ($500) for attorney fees and one hundred dollars ($100) for professional witnesses and other incidental expenses in preparing for trial. A similar procedure based on nearly identical facts was followed in Rentchler (1071 S 295). I think these awards are in accordance with Rule TR. 41(A)(2), IC 1971, 34--5--1--1 which reads in part as follows:

'. . . an action shall not be dismissed at the plaintiff's instance save upon order of the court and upon such terms and conditions as the court deems proper.' (emphasis added)

As it is applicable to condemnation cases, as well as general civil litigation, this Rule may be employed to implement the Constitutional clause which specifically requires just compensation when land is taken for public use. Article I, § 21 of the Indiana Constitution reads as follows:

'No man's particular services shall be demanded, without just compensation. No man's property shall be taken by law, without just compensation; nor, except in case of the State, without such compensation first assessed and tendered.' (emphasis added)

In my...