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FOR PUBLICATION IN WEST'S HAWAI‘I REPORTS AND PACIFIC REPORTER
IN THE INTERMEDIATE COURT OF APPEALS
OF THE STATE OF HAWAIT
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(
DAVID W. HALL, Attorney at Law,
A Law Corporation, Plaintiff-Appellant
v
JAMES H. LAROYA, defendant-Appellee
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NO. 28754
APPEAL_FROM THE DISTRICT COURT OF THE FIRST CIRCUIT
HONOLULU DIVISlON
(ClVIL NO. lRCO6-l~llOl)
SEPTEMBER 2, 2010
NAKAMURA, C.J., REIFURTH and GINOZA, JJ.
OPINION OF THE COURT BY GINOZA, J.
3.
Plaintiff-Appellant David W. Hall, Attorney at Law,
(Hall law firm) initiated this action (collection
costs, and taxes
Law Corporation
(Laroya)
to collect $8,60l.92 in attorney fees,
action)
for legal services provided to Defendant James H. Laroya
After Laroya defaulted in this collection
in a prior case.
action, the District Court of the First Circuit, Honolulu
Division (district court), entered judgment on August 22, 2007,
awarding the Hall law firm the principal amount of $8,601.92,
plus interest, filing fees, and other costs. The district court
did not, however, award the attorney fees requested by the Hall
§ 607-14 l
law firm pursuant to Hawaii ReVised Statutes (HRS)
(Supp. 2006) for the litigation of the instant collection action.
contending that it is entitled to
The Hall law firm now appeals,
an award of attorney fees pursuant to HRS § 607-14 for litigating
this case.
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This case presents the question of whether a law firm
that prevails in a court action to collect fees from a client may
also be awarded attorney fees under HRS § 607-14 for the work of
an attorney employed with the law firm who represents the firm in
the collection action. Given the language and history of the
statute and HawaiU.case law, we answer this question in the
affirmative.
I . STATEMENT OF FACTS
The named plaintiff in this action is the Hall law
firm, a law corporation. Based on the declaration of David W.
Hall (attorney Hall), as an employee of the Hall law firm, he
represented Laroya in a criminal matter beginning on September l,
2003 and, although Laroya agreed to pay for the legal services,
Laroya later failed to make any payments.
On February 24, 2006, the Hall law firm filed a
complaint in district court against Laroya, seeking $8,60l.92 in
attorney fees, costs, and gross excise tax for services rendered
to Laroya from September l, 2003 through April 7, 2005.
On February 23, 2007, the district court denied a
proposed default judgment submitted by the Hall law firm which
had requested a total of $l4,6ll.55, including a request for
$2,632.5O for attorney fees in litigating the instant case.1 The
district court denied the requested judgment because the
complaint was not verified, and the court also added the
following notation: "cannot recover Attorney's Fees as you are
essentially representing yourself."
On March l, 2007, the Hall law firm submitted an §§
Parte Motion for Reconsideration of Denial of Judgment and
Attorney's Fees (Motion for Reconsideration). In support of the
Motion for Reconsideration, attorney Hall submitted a declaration
that stated, in pertinent part:
1 The Honorable Faye M. Koyanagi ruled on this request.
2
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10.
l3.
1 am the attorney for the Plaintiff in the above-
entitled matter.
The attached motion to reconsider is filed ex parte
because Defendant was served by publication and cannot
be found.
As an employee of Plaintiff, 1 represented the
Defendant in State of Hawaii vs. James Lar0ya,
Criminal Case No. 1P103»09420, Citation/Report No.
O3349488, in which he was charged with impersonating a
police officer in the second degree, extortion in the
third degree and sexual assault in the fourth degree.
1 spent 77.9 hours from September 1, 2003 through May
l0, 2004 in resolving the case with a deferred
acceptance of a no contest plea to impersonating a
police officer in the second degree which was
ultimately dismissed after another year. 1 performed
all work in the case under Plaintiff's name and bills
were submitted to Defendant in Plaintiff's name.
Although Defendant had consistently said that he would
pay for the services rendered, he did not pay
anything.
1 filed a verified complaint in this action to recover
the money owed Plaintiff on February 24, 2006.
After many failed attempts to locate Defendant, he was
served by publication.
Defendant failed to appear on February 20, 2007. 1
appeared on behalf of Plaintiff and requested that a
default be entered and that Plaintiff be permitted to
submit a Judgment and request for attorney's fees and
costs and the Court so ordered.
On February 22, 2006, 1 submitted a Judgment and
Declaration Regarding Attorneys' Fees and Costs on
behalf of Plaintiff with detailed time sheets as
Exhibit 1 and costs as Exhibit 2.
On February 26, 2007, 1 received the Judgment and the
Declaration Regarding Attorneys' Fees and Costs and
Exhibits 1 and 2 back stamped “Denied" with the
explanation that "per court minutes on 2-20-07,
complaint not verified" and "cannot recover attorney's
fees as you_are essentially representing yourself."
‘ 1 have practiced as an shareholder, director, officer
and employee of Plaintiff and its predecessor
corporations since 1980 and prior to 1980, 1 had
practiced under various other corporate entities and
partnerships since 197l. '
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On March 8, 2007, the district court denied the Motion for
Reconsideration.2
On July 26, 2007, default judgment was entered and on
August 22, 2007, judgment was entered, awarding a total of
$12,438.73,3 but not awarding attorney fees for the work in this
collection action.
II. DISCUSSION
A. Standards of Review
On appeal, a trial court's grant or denial of
attorneys' fees is reviewed under the abuse of discretion
standard. Kamaka v. Goodsill Anderson Quinn & Stifel, 117
HaWafi 92, lO5, 176 P.3d 9l, 104 (2008); TSA Int'l, Ltd. V.
ShimiZu Corp., 92 HaWaiT.243, 253, 990 P.2d 7l3, 723 (l999).
The trial court abuses its discretion if it bases its ruling
on an erroneous view of the law or on a clearly erroneous
assessment of the evidence. Stated differently, an abuse of
discretion occurs where the trial court has clearly exceeded
the bounds of reason or disregarded rules or principles of
law or practice to the substantial detriment of a party
litigant.
TSA Int'l Ltd., 92 HaWai‘i at 253, 990 P.2d at 723 (CitatiOnS,
internal quotation marks, and brackets omitted).
1n this case, the statutory interpretation of HRS §
607~14 is central to the issue on appeal, For purposes of
interpreting a statute,
our foremost obligation is to ascertain and give effect to
the intention of the legislature, which is to be obtained
primarily from the language contained in the statute itself.
And we must read statutory language in the context of the
entire statute and construe it in a manner consistent with
its purpose.
when there is doubt, doubleness of meaning, or
indistinctiveness or uncertainty of an expression used in a
statute, an ambiguity exists....
In construing an ambiguous statute, the meaning of the
ambiguous words may be sought by examining the context, with
which the ambiguous words, phrases, and sentences may be
compared, in order to ascertain their true meaning. HRS §
1-15(1) (l993). Moreover, the courts may resort to extrinsic
2 The Honorable Hilary Gangnes ruled on the Motion for Reconsideration.
3 The total judgment amount was comprised of: $8,601.92 for the
principal amount; $2,821.84 for interest; $120 for costs of court; and $894.97
for other costs.
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aids in determining legislative intent. One avenue is the
use of legislative history as an interpretive tool.
Fought & Co. v. Steel Eng'q and Erection, 1nc., 87 HawaiH_37,
45, 951 P.2d 487, 495 (1998) (citations, internal quotation
marks, and brackets omitted).
B. Attornevs' Fees Under HRS § 607-14
The Hawafi Supreme Court has often stated with regard
to the award of attorneys' fees that:
Generally, under the "American Rule," each party is
responsible for paying for his or her own litigation
expenses. A notable exception to the "American Rule,"
however, is the rule that attorneys' fees may be awarded to
the prevailing party where such an award is provided for by
statute, stipulation, or agreement.
TsA Int'i Ltd., 92 Hawai‘i at 263, 990 P.zd at 733 (citations
omitted); see also DFS Group L.P. v. Paiea Properties, 110
Hawai°i 217, 219, 131 P.3d 500, 502 (2006); Ranger 1ns. Co. v.
HinShaW, 103 HaWafi 26, 3l, 79 P.3d ll9, l24 (2003).
HRS § 607-14 is a statutory exception to the American
Rule. 1t provides, in pertinent part:
§ 607-14 Attorneys' fees in actions in the nature of
assumpsit, etc. In all the courts, in all actions in the
nature of assumpsit . . . there shall be taxed as attorneys'
fees, to be paid by the losing party and to be included in
the sum for which execution may issue, a fee that the court
determines to be reasonable; provided that the attorney
representing the prevailing party shall submit to the court
an affidavit stating the amount of time the attorney spent
on the action and the amount of time the attorney is likely
to spend to obtain a final written judgment, or, if the fee
is not based on an hourly rate, the amount of the agreed
upon fee. The court shall then tax attorneys' fees, which
the court determines to be reasonable, to be paid by the
losing party; provided that this amount shall not exceed
twenty-five per cent of the judgment.
The above fees provided for by this section shall be
assessed on the amount of the judgment exclusive of costs
and all attorneys' fees obtained by the plaintiff, and upon
the amount sued for if the defendant obtains judgment.
Here, where Laroya promised to pay for legal services,
this action to collect the fees he owes is “in the nature of
assumpsit." See Chuck Jones & MacLaren v. Williams, 101 Hawafi
486, 502, 71 P.3d 437, 453 (App. 2003) (implicitly recognizing
FOR PUBLICATION IN WEST'S HAWAI‘I REPORTS AND PACIFIC REPORTER
that HRS § 607-14 applied to a fee collection action for legal
services); Kamaka, 117 HawaFi at 121-22, 176 P.3d at 120-21
("Assumpsit is a common law form of action which allows for the
recovery of damages for non-performance of a contract, either
express or implied, written or verbal, as well as quasi
contractual obligations.") (quoting Blair v. 1ng, 96 Hawafi 327,
332, 31 P.3d 184, 189 (2001)) (internal quotation marks and
brackets omitted).
The express terms of HRS § 607-14 are broad, stating
that "[i]n all the courts, in all actions in the nature of
assumpsit[,]" reasonable attorneys' fees "§hall be taxed[.]" HRS
§ 607-14 (emphasis added). The breadth of this language suggests
that attorneys' fees should be recoverable in cases such as
this.4 Hawai‘i case law supports this conclusion.
1n Middleditch v. Kawananakoa, 16 Haw. 803 (Haw. Terr.
1905), the Supreme Court of the Territory of Hawafi held that an
4 The paragraph in the statute explaining that attorneys' fees should be
assessed "on the amount of the judgment exclusive of costs and all attorneys'
fees obtained by the plaintiff, and upon the amount sued for if the defendant
obtains judgment“ does not preclude the award of attorneys' fees under the
statute in a collection action such as this, where the underlying debt itself
is for attorneys' fees. Rather, the “exclusive of costs and all attorneys'
fees" language was added in 1935 to clarify that the calculation of attorneys'
fees under the statute, when the plaintiff prevails, should be based on the
underlying amount awarded before adding costs and attorneys' fees. The Senate
Committee Report regarding the amendment states, in relevant part:
This statute provides, in part, that such fees shall be assessed
on the amount of the judgment obtained by the plaintiff. As a
judgment rendered in favor of the plaintiff includes costs and
attorney's fees taxable under the particular section of the
Revised Laws proposed to be amended as well as other sections
thereof, such costs and attorney's fees should be excluded from
the judgment when the attorney's fees first referred to above are
determined.
S. Stand. Comm, Rep. No. 122, in 1935 Senate Journal, at 631.
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attorney "acting on his own behalf as plaintiff" was entitled to
recover attorney fees under the predecessor statute to
HRS § 607-14. The court stated in full:
Attorney's fees in actions of assumpsit when the plaintiff,
being an attorney at law, conducts his own case. The statute
` allowing attorney's fees in actions of assumpsit applies in
cases in which an attorney at law is a party and conducts
his own case. The plaintiff recovered judgment in an action
of assumpsit in the sum of $616.25 with interest and costs
of court. The plaintiff, being an attorney at law, appeared
in person. The plaintiff's exceptions present the question
whether the plaintiff appearing in person and acting on his
own behalf as plaintiff in this action is entitled to
attorney's fees as provided by sections 1889 and 1892 of the
Revised Laws upon the judgment rendered in his favor, the
trial court having granted the defendant's motion to vacate
the order taxing plaintiff's costs of $59.35.
The fact that the attorney in this case is the plaintiff
does not deprive him of the statutory right to attorney's
fees. The exception is sustained and the order excepted to
is set aside.
1d; (emphasis added). Although in the instant case the named
plaintiff is the Hall law firm -- not attorney Hall individually
-- this case is similar to Middleditch. We can discern no
relevant distinction from Middleditch in this circumstance.
1n Lau v. Lopez, 112 HawaiH.231, 145 P.3d 774 (App.
2006), this court presumed that Middleditch was binding
precedent5 but distinguished it because there the same individual
(Lau) was acting in his capacity as both the plaintiff Trustee
for another person's living trust as well as the attorney for the
Trustee. Under such facts, this court held that the problem of
5 In Lag, the 1ntermediate Court of Appeals (1CA) noted that
Middleditch was printed in a section of volume 16 of the HawaiE Reports
titled "Decisions Announced without Opinions During the Period Covered by this
Volume," but that subsequently the Hawaid Supreme Court had cited decisions
in this part of volume 16. Thus, notwithstanding Rule 35 of the Hawaid Rules
of Appellate Procedure (HRAP) (2006), the 1CA in gap assumed that Middleditch
was binding precedent for purposes of that case. we follow gap in recognizing
Middleditch as binding precedent. 1n addition to the analysis in Lau, because
Middleditch was a published decision in the Hawafi Reports, we do not believe
that its citation is prohibited by HRAP Rule 35 (2010), as amended and
effective July 1, 2008.
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double recovery of trustee fees and attorney fees, as well as
potential conflicts of interest, precluded recovery of attorney
fees under HRS § 607-14. No similar problems exist in the
instant case.‘
2 Additionally, Kamaka provides indirect but instructive
guidance. There, a terminated attorney brought action against a
flaw firm claiming, inter alia, breach of implied contract, and
the Hawafi Supreme Court considered whether the prevailing law
firm could collect attorneys' fees under HRS § 607-14. 117
Hawafi at 121-26, 176 P.3d at 120-25. After reviewing the issue
carefully, the Hawafi Supreme Court affirmed the trial court's
award of attorneys' fees in the amount of $364,154.25 to the
defendant Goodsill law firm, which was 25% of the judgment
requested by the plaintiff at trial. ;d4 at 126, 176 P.3d at
125. 1n addressing the issue of whether the Goodsill firm had
adequately documented its attorneys' fees, the court noted that
the Goodsill firm had provided evidence of the billing by its
outside counsel, the Miller law firm, and also evidence of the
fees for attorneys within the Goodsill law firm who had worked on
the case. 1Q; at 122-23, 176 P.3d at 121-22, Billing statements
from the Miller law firm amounted to $406,059.38, and a sworn
statement also established that "Goodsill's [own] attorneys' fees
amounted to more than double the amount of $365,154.25 [sic]."
5 we note that a different issue could arise where an attorney serving
as the trial advocate is also a necessary witness. 1n such a circumstance,
Rule 3.7 of the HawaFi Rules of Professional Conduct may preclude the
attorney from serving as the advocate at trial. However, Rule 3.7 dictates
the proper conduct at a trial and does not affect the requirements under HRS §
607-14. Here, because defendant Laroya defaulted and did not contest any of
the issues, there was no trial and Rule 3.7 did not come into play.
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;d; (first bracket in original). The court thus concluded "we
cannot say that [the trial court's] award of fees was made
without adequate documentation." ;d4 at 123, 176 P.3d at 122.
Nowhere in the opinion does the Hawafi Supreme Court
indicate that attorneys' fees are precluded under HRS § 607-14
for the work done by the Goodsill attorneys and instead the
documentation of that work is relied upon by the court.7 §§e
also Chuck Jones & MacLaren, 101 Hawai‘i at 502, 71 P.3d at 453
(1CA presumed as valid the trial court's award of attorneys' fees
pursuant to HRS § 607-14 where attorneys brought collection
action for prior legal services; however, fee award was vacated
and remanded on other grounds).
C. 1993 Amendments to HRS § 607-14
1n 1993, HRS § 607-14 was amended to add an underlying
or provisional requirement for the award of attorneys' fees in
assumpsit cases. Under this amendment, inter alia, the statute
now requires that the attorney representing the prevailing party
submit an affidavit, as follows:
. . . provided that the attorney representing the prevailing
party shall submit to the court an affidavit stating the
amount of time the attorney spent on the action and the
amount of time the attorney is likely to spend to obtain a
final written judgment, or, if the fee is not based on an
hourly rate, the amount of the agreed upon fee.
7 we do note that the Hawaid Supreme Court in Kamaka did not need to
reach or address the precise issue of awarding fees for work by the Goodsill
attorneys. That is, the attorneys' fees billed by the Miller law firm were
already more than the amount recoverable (i.e., 25% of the "amount sued for"
by plaintiff Kamaka) and ultimately awarded, and thus it is arguable that the
fees awarded in Kamaka were just for the work by the Miller law firm,
Nevertheless, Kamaka is instructive in that the fees by Goodsill attorneys
were considered by the court in the overall question of reasonably documenting
the fees awarded in that case.
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HRS § 607-14. We point out this amendment because one might
argue that it reflects an intent to only award attorneys' fees
where fees are charged and must be paid by the prevailing party.
We conclude, however, that the requirement of the attorney
affidavit was not intended to so limit the award of attorneys'
fees under HRS § 607-14.
First, the language of the statute does not expressly
state such a limitation. Second, to the extent any ambiguity
exists, the history of the statute is helpful in determining the
legislative intent. 1n its original version, first adopted in
1872, and for over a hundred years thereafter, the statute did
not have the requirement of an attorney affidavit. Rather, the
statute simply set out a schedule or formula for the attorneys'
fees to be taxed, similar to a commission,B regardless of whether
the prevailing party was obligated to pay attorneys' fees. The
original version of the statute read:
1n all the courts of this Kingdom, in all actions of
assumpsit there shall be taxed as attorney's fees, in
addition to the attorney's fees now taxable by law, to be
paid by the losing party and to be included in the sum for
which execution may issue, ten per cent. on all sums to one
hundred dollars, and two and one-half per cent. in addition
on all sums over one hundred dollars, to be computed on the
excess over one hundred dollars. The above fee shall be
assessed on the amount of the judgment obtained by the
plaintiff and upon the amount sued for, if the defendant
obtain judgment..
1872 Haw. Sess. Laws, Act 29, § 5.
3 1n Nott v. Silva, 16 Haw. 635, 637 (Haw. Terr. 1905), the Supreme
Court of the Territory of HawaiH considered the version of the statute then
in place, Revised Laws section 1892, and expressed the view that "these fees
are in the nature of commissions estimated by percentages of the amount for
which judgment is obtained or the amount sued for . . . ." (emphasis added).
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A schedule or formula for taxing attorneys' fees,
although updated over time, continued to guide the award of
attorneys' fees until 1993.9 1n 1993, the Legislature amended
the statute by, inter alia, (1) deleting the schedule of
attorneys' fees, (2) adding the current language requiring an
affidavit from the attorney representing the prevailing party,
and (3) limiting recovery to twenty-five percent of the judgment
or amount sued for, depending on which party obtains fees. The
legislative history for the amendments in 1993 does not reveal an
intent to limit or bar the recovery of fees previously allowed,
but rather to more fairly compensate parties who prevail in
assumpsit cases by changing the "manner" in which those fees are
determined. The Conference Committee Report for the 1993
amendments states, in pertinent part:
The purpose of the bill is to change the manner in
which attorneys' fees are determined in assumpsit actions.
Your Committee finds that attorneys' fees in assumpsit
actions are often based on a percentage as opposed to an
hourly rate, and that the current law does not fairly
compensate the creditor for the expense of retaining an
attorney to prosecute its claim, nor does it fairly
compensate the defendant who prevails against a creditor's
faulty claim,
Conf. Comm. Rep. No. 127, in 1993 Senate Journal, at 796
(emphasis added); see also S. Stand. Comm. Rep. No. 1122, in 1993
Senate Journal, at 1182; H. Stand. Comm. Rep. No. 194, in 1993
House Journal, at 1043. Although part of the committee's report
references the "retaining" of attorneys, the overall intent and
purpose of these amendments appear to be to increase the
9 Prior to its amendment in 1993, HRS § 607-14 (1985) provided recovery
Of: '
a fee which the court determines to be reasonable but which shall
not exceed the amount obtainable under the following schedu1e:
25 per cent on first $1,000 or fraction thereof.
20 per cent on second $1,000 or fraction thereof.
15 per cent on third $1,000 or fraction thereof.
10 per cent on fourth $1,000 or fraction thereof.
5 per cent on fifth $1,000 or fraction thereof.
2.5 per cent on any amount in excess of $5,000.
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availability of attorneys' fees in assumpsit actions, rather than
to limit them.
Finally, there is no indication the Legislature was
contemplating, by way of the 1993 amendments or any other
amendments to the statute, the issue we address in this case or
any concern about the long-standing Middleditch decision.
We therefore conclude that, even to the extent there is
any ambiguity in HRS § 607-14, its legislative history does not
reveal any intent to undo the application of Middleditch or to
preclude the award of attorneys' fees in circumstances such as
this case. This interpretation of the statute is also consistent
with Kamaka, which was decided after the adoption of the 1993
amendments to HRS § 607-14.
D. Other Jurisdictions
Cases from other jurisdictions are split on whether
attorneys representing themselves or their firms can recover for
their respective attorney fees under fee-shifting statutes. Some
cases have found that recovery of attorneys' fees is precluded in
such circumstances, based mostly on the intent and purpose of the
statute in issue.
1n Kay v. Ehrler, 499 U.S. 432 (1991), the United
States Supreme Court upheld the denial of attorney fees to a pro
se attorney litigant where the fee-shifting statute was a civil
rights statute, 42 U.S.C. § 1988. The court framed the question
before it as "whether a lawyer who represents himself should be
treated like other pro se litigants or like a client who has had
the benefit of the advice and advocacy of an independent
attorney." ;d; at 435. 1n construing the federal statute, the
U.S. Supreme Court noted that neither the text nor history of 42
U.S.C. § 1988 provided a clear answer. 1d4 The court ultimately
determined that the "overriding statutory concern" of 42 U.S.C1 §
1988 was that "independent counsel for victims of civil rights
violations" be obtained and that "Congress was interested in
ensuring the effective prosecution of meritorious claims." ld;
at 437. Therefore, the court determined that the better rule
would be to not allow attorneys' fees to pro se attorney
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litigants so that there would be "an incentive to retain counsel
in every such case." lQ; at 438{
1n Trope v. Katz, 902 P.2d 259 (Cal. 1995), a law firm
sued a former client for legal fees of $163,000 for services
provided in a prior case. A representation agreement between the
law firm and the client provided that, "[i]n the event it becomes
necessary to file an action to recover the fees and costs set
forth in this agreement, the Court may award reasonable
attorneys' fees for the recovery of said fees and costs." ;d; at
262. The law firm prevailed on its complaint and then sought
attorneys' fees under the retainer contract. lQL
The California Supreme Court first determined that
section 1717 of the California Civil Code (Cal. Civ. Code §1717)
applied. ;QL at 263. Section 1717, subdivision (a), stated in
pertinent part:
In any action on a contract, where the contract specifically
provides that attorney's fees and costs, which are incurred
to enforce that contract, shall be awarded either to one of
the parties or to the prevailing party, then the party who
is determined to be the party prevailing on the contract,
whether he or she is the party specified in the contract or
not, shall be entitled to reasonable attorney‘s fees in
addition to other costs.
;d; The court thus analyzed the issue as a matter of statutory
interpretation, stating that "[o]ur resolution of this issue
turns on how we construe section 1717, and particularly on how we
define the words 'reasonable attorney's fees' in subdivision (a)
of that statute." 1d;
The court focused on the terms in section 1717,
particularly "incurred" and "fee," ultimately concluding:
"[a]ccordingly, the usual and ordinary meaning of the words
'attorney's fees,' both in legal and in general usage, is the
consideration that a litigant actually pays or becomes liable to
pay in exchange for legal representation. An attorney litigating
in propria persona pays no such compensation." 1Q4 at 264; see
also Calhoun v. Calhoun, 529 S.E.2d 14, 17 (S.C. 2000) (under a
statute that allows recovery of reasonable attorneys' fees
"incurred", the court held that pro se attorney litigants could
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not recover because they "[do] not become liable for or subject
to fees charged by an attorney.")
Other cases have reached the opposite conclusion. 1n
Bond v. Blum, 317 F.3d 385 (4th Cir. 2003), the Fourth Circuit
Court distinguished gay and held that its principles:
do not apply in circumstances where entities represent
themselves through in-house or pro bono counsel. 1n Kay,
the Supreme Court explained the distinction: "[A]n
organization is not comparable to a pro se litigant because
the organization is always represented by counsel, whether
in-house or pro bono, and thus, there is always an
attorney-client relationship." 499 U.S. at 436 n. 7, 111
S.Ct. 1435. When a member of an entity who is also an
attorney represents the entity, he is in an attorney-client
relationship with the entity and, even though interested in
the affairs of the entity, he would not be so emotionally
involved in the issues of the case so as to distort the
rationality and competence that comes from independent
representation.
§Qnd, 317 F.3d at 399-400. See also Robbins v. Krock, 896 N.E.2d
633, 635-36 (Mass. App. Ct. 2008) ("[O]ther jurisdictions are in
conflict as to whether a lawyer representing herself in a pro se
capacity has the right to recover attorney fees. We believe the
better rule to be one that allows an attorney who represents
herself to recover the same costs she would be entitled to if she
had been represented by another."); Hinkle, Cox, Eaton, Coffield
a Henslev v. sadie Co. of ohio, Inc.,' 843 P.zd 1079, 1035 (N.M.
1993) (where an associate of the defendant law firm provided
legal services to the firm, the New Mexico Supreme Court stated
that "[i]t would be unjust to deny fees to an attorney or law
firm for self-representation when the attorney or firm, in
rendering services for itself, has potentially incurred as much
pecuniary loss as if it had employed outside counsel" and "it
should be of no significance to the party bound to pay attorney's
fees whether the award of fees is to an attorney or firm
representing itself or is to retained counsel.")
We survey these cases because they provide some
perspective on how the issue has been addressed by other courts.
we note, for instance, that HRS § 607-14 is not a civil rights
statute as in gay where there was an overriding concern in having
independent counsel. Moreover, unlike the statutes in Trope and
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Calhoun, HRS § 607-14 does not include language that the
attorneys' fees be "incurred," which those courts construed as
meaning an amount the litigant must actually pay or be liable to
PaY-
Ultimately, the issue for this court must turn on
existing Hawafi case law and the specific language and intent of/~
HRS § 607-14. As noted above, Hawafi case law, the broad
language of HRS § S07-14, and -- to the extent the statute is
ambiguous -- the legislative history of HRS § 607-14, support a
determination that the award of attorneys' fees is allowed where
an attorney represents his or her firm in an assumpsit action.
To the extent there is a concern that recovery of
attorneys' fees in these types of situations will be subject to
abuse, we note that HRS § 607-14 limits recovery to "a fee that
the court determines to be reasonable" and that is subject to the
twenty-five percent cap provided under the statute,
I I I . CONCLUS ION
1n light of the foregoing, the district court based its
decision on an erroneous reading of HRS § 607-14 and therefore
erred in denying the attorney fees requested by the Hall law firm
for litigating this collection action. We remand for further
proceedings consistent with this opinion.
On the briefs:
David w. Hall
for Plaintiff-Appellant y
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