Williamson v. Middleton

• Decision Date: 07 May 2007
• Docket Number: No. 4243.,4243.
• Citation: 649 S.E.2d 57
• Court: South Carolina Court of Appeals
• Parties: Dan F. WILLIAMSON and Dan F. Williamson and Company, Appellants, v. Alfred C. MIDDLETON, Respondent.

649 S.E.2d 57

Dan F. WILLIAMSON and Dan F. Williamson and Company, Appellants, v. Alfred C. MIDDLETON, Respondent.

No. 4243.

Court of Appeals of South Carolina.

Heard November 8, 2006.

Decided May 7, 2007.

Rehearing Denied August 24, 2007.

Desa A. Ballard, of W. Columbia, for Appellants.

James C. Parham, Patricia S. Revenhorst, and Wallace K. Lightsey, for Respondents.

HEARN, C.J.

Dan F. Williamson and Dan F. Williamson and Company (collectively, "Williamson") appeal from the trial judge's award of attorneys' fees to Alfred C. Middleton. Williamson argues that Middleton is not entitled to attorneys' fees, or in the alternative, that the criteria for awarding attorneys' fees were not met in this case. We affirm.¹

FACTS

Prior to this litigation, Middleton worked for a number of years as a commissioned salesman for Williamson. When Middleton quit working for Williamson, he was due a commission for having sold pallets to one of Williamson's customers. Middleton and Williamson disagreed as to the amount of commission due to Middleton, and Williamson never paid Middleton any commission, even though it eventually admitted owing him $906.62.

Middleton left his employment with Williamson to work for Peninsula Plastics, Inc., one of Williamson's pallet suppliers. While at his new job, Middleton continued to seek the commission Williamson owed him to no avail, and in the spring of 2001, he hired Mr. James C. Parham, a partner with the Wyche Burgess law firm. Middleton and Parham were personal friends who had met years before when Middleton owned a sporting goods store that Parham frequently visited.

On behalf of Middleton, Parham wrote to Williamson inquiring about the commission due. When he received no response, Parham spoke with Williamson's attorney, Bill Jordan, informing him that a complaint had already been drafted and that Middleton was ready to sue to recover the unpaid commission. Jordan requested that Middleton refrain from acting on the drafted complaint until Jordan could speak with his client. Parham agreed, and two days later, Jordan filed a complaint on behalf of Williamson against Middleton, alleging causes of action for fraud, constructive fraud, breach of fiduciary duty, and violation of the South Carolina Unfair Trade Practices Act. Middleton filed an answer, denying the allegations and counterclaiming for commissions owed and sanctions under the South Carolina Frivolous Proceedings Act. Middleton also requested attorneys' fees. Upon the initiation of litigation, Patricia Ravenhorst, an associate with the Wyche Burgess firm, assisted Parham in representing Middleton.

While preparing for trial, Middleton had an extraordinarily difficult time collecting responses to its requests for discovery. In Middleton's first set of interrogatories for Williamson, Middleton asked that Williamson "state with particularity the facts alleged by [Williamson] to form the basis of the first, second, third, fourth, fifth, and sixth causes of action." Williamson provided no alleged facts and instead responded with a mere promise to "supplement[ ] after further discovery and investigation." A verbatim response was provided to Middleton's request for a statement of all damages sustained by Williamson. After receiving these unhelpful responses, Middleton's attorneys initiated several phone conversations and wrote a number of letters imploring Williamson to respond to their requests.

While Middleton waited for discovery responses during the ensuing months, Williamson filed a motion in October of 2001 seeking to amend its pleadings to add Peninsula Plastics and Middleton's supervisor at Peninsula Plastics as defendants and to add three more causes of action. When the hearing on Williamson's motion was just days away, it finally supplemented its responses to Middleton's discovery requests. On November 17, 2001, Judge Henry Floyd denied Williamson's motion to amend, finding it was not well founded, was not required by justice, and would be prejudicial to Middleton. Less than one month later, Williamson filed a separate lawsuit against Middleton; this suit also named Peninsula Plastics and Middleton's supervisor as parties and included the very causes of action Williamson attempted to append to the initial complaint against Middleton. Only after Middleton moved to dismiss this new lawsuit and sought attorneys' fees did Williamson voluntarily dismiss this second complaint.

In addition to Williamson's race to the courthouse to be the first to file, its uncooperativeness when responding to discovery, and its attempt to circumvent Judge Floyd's order, Williamson also cancelled depositions and mediation several times. In at least one instance, the cancellation was communicated so late that Middleton and both of his attorneys were already at the mediator's office when Williamson's attorney called to cancel. Approximately one month prior to trial, Williamson's attorney moved to be relieved as counsel, and Williamson hired its current counsel.

Of Williamson's claims against Middleton, only its cause of action for breach of fiduciary duty went to the jury. The jury returned a verdict in favor of Middleton on that cause of action, and it also found in favor of Middleton on his counterclaim for unpaid commissions, awarding him $906.62 in actual damages.

The trial judge, Judge Pyle, found Middleton was entitled to attorneys' fees, but he asked the parties to attempt to determine the amount of attorneys' fees amongst themselves. In the event the parties could not agree to an amount, Judge Pyle explained he would set the amount for them. The parties could not come to a consensus on the amount of attorneys' fees, and Middleton petitioned the court for assistance. A hearing was held before Judge Miller, who awarded Middleton $35,000 in attorneys' fees. On appeal, our court reversed this award of attorneys' fees, finding Judge Pyle retained exclusive jurisdiction over the matter. We therefore reversed Judge Miller's award and remanded the issue of attorneys' fees for Judge Pyle's consideration. See Williamson v. Middleton, 2005-UP-011 (S.C. Ct.App. filed January 11, 2005).

At the hearing before Judge Pyle, Williamson argued Middleton was not entitled to attorneys' fees because he was not the prevailing party; the bill Middleton's counsel presented documenting over $100,000 worth of work listed hours spent on claims other than the unpaid commissions claim for which attorneys' fees are allowed; and the amount of fees Middleton's counsel requested, $35,000, far exceeded the $906.62 verdict. Williamson also argued Middleton did not actually incur any fees because when Parham was deposed, he admitted there was no written fee agreement between him and Middleton.

Judge Pyle found Middleton was entitled to attorneys' fees because he prevailed in his action against Williamson for unpaid commissions pursuant to section 39-65-20 of the South Carolina Code. Judge Pyle found that in light of "the detailed time statements, the affidavits of Middleton's counsel, and a review of the supporting memorandum and notebook of exhibits presented by Middleton's counsel, ... the time and labor were reasonable, not duplicative and were required of Middleton's counsel in asserting his claim and overcoming the obstructions presented by [Williamson]." Judge Pyle also pointed out that although the detailed statements submitted by Middleton's counsel showed $106,992 in attorneys' fees, Middleton requested only a fraction of that amount. With regard to contingency of compensation, Judge Pyle acknowledged that Middleton and his attorney had not entered into a formal, written fee agreement, but they relied instead "on their long-standing personal relationship and mutual agreement to determine an appropriate fee for services at the conclusion of this matter." Judge Pyle found such an agreement did not preclude attorneys' fees. Finally, the judge noted that the fees were reasonable despite a verdict of only $906.62 because Williamson forced Middleton to file his counterclaim even though Williamson admitted he owed this amount at trial. Judge Pyle explained:

Failure to award Middleton reasonable attorneys' fees and costs incurred in this matter would encourage employers to discourage and obstruct legitimate claims by employees. . . . Employers, such as [Williamson], with significant financial resources should not be permitted to systematically obstruct an employee's efforts to recover unpaid commissions or other wages however small the sum might be. Such a result would be especially egregious in the present case considering the fact that [Williamson] admit[s] owing Middleton these unpaid commissions before and during the course of this extended litigation, but consistently refused to pay him anything.

Accordingly, Judge Pyle awarded Middleton $35,000 in attorneys' fees. Williamson filed a Rule 59(e), SCRCP, motion, which was denied. This appeal followed.

STANDARD OF REVIEW

The parties disagree as to the standard of review. During oral argument, Williamson urged us to apply either an equitable standard of review pursuant to Hanahan v. Simpson, 326 S.C. 140, 485 S.E.2d 903 (1997), or an abuse of discretion standard of review pursuant to Russell v. Wachovia, 370 S.C. 5, 633 S.E.2d 722 (2006).² In either event, Williamson argued we should not review the trial judge's decision under an "any evidence" standard. Middleton agrees that an abuse of discretion standard should be applied, but that under such standard, an appellate court will affirm the trial judge so long as there is any competent evidence supporting the judge's decision.

We find the law well settled that the review of attorney's fees awarded pursuant to statute is governed by an abuse of discretion standard. See, e.g., Blumberg v. Nealco, 310 S.C. 492, 493, 427 S.E.2d 659, 660 (1993) (finding that a trial judge's decision to award attorney's fees will not be reversed on appeal absent an abuse of...