Daly v. Hill

KELLAM, District Judge,

dissenting.

The majority opinion finds from the record that the trial court “erred in calculating the fee [hourly rate of fee award] based upon historic rates without accounting for the effect of delay in payment on the value of the fee, and in disallowing reasonable litigation expenses.” [P. 1085] That is, the majority opinion concludes that the trial court applied market hourly rates for legal services at the 1982-1983 level— the time when the services were performed — when it should have applied the market rate at the 1984 level, the year when the services were being established, and that the trial court erroneously disal*1086lowed certain items of expenses claimed. I respectfully disagree.

I agree with the majority that “reasonable fees” are to be calculated according to prevailing market rates in the community. Blum v. Stenson, 465 U.S. 886, 104 S.Ct. 1541, 1547, 79 L.Ed.2d 891 (1984). The amount of fee to be awarded must be determined on the facts of each case, and the “most useful starting point for determining the amount of a reasonable fee is the number of hours reasonably expended on the litigation multiplied by a reasonable hourly rate.” Hensely v. Eckerhart, 461 U.S. 424, 103 S.Ct. 1933, 1939, 76 L.Ed.2d 40 (1983). See also Webb v. Board of Education of Dyer County, — U.S. -, 105 S.Ct. 1923, 1928, 85 L.Ed.2d 233 (1985). In Blum, supra, n. 11, the Court pointed out that “the critical inquiry in determining reasonableness is now recognized as the appropriate hourly rate.” 104 S.Ct. at 1547. The appellant has the burden “to justify the reasonableness of the requested rate or rates,” and to “inform and assist the Court ... to produce satisfactory evidence” that the rates are those prevailing in the community for similar services. A rate determined in this way is normally deemed to be reasonable.” Id.

Where I differ with the majority is in its finding that the basis of “the Court’s reduction in the requested rates was its belief that it was not proper to award fees based upon current market rates. Rather, the Court determined that fees should be awarded based upon the rates at the time the work was performed.” [P. 1075]

To support this conclusion, the majority opinion says:

However, in assessing the weight to be accorded the supporting affidavits, the Court found it to be ‘significant that most of the hours for which Mr. Daly is claiming compensation were in 1982 and 1983, whereas, the affidavits he has filed are based on 1984 hourly rates.’ [P. 1080]

The majority opinion infers from the above statement that the trial court applied the 1982-1983 hourly market rates for services, rather than the 1984 hourly market rate, the time when the hourly rate was being established. It justifies such an inference from its conclusion that “the rates adopted by the district court were lower than the lowest rate in each city supported by the evidence before the Court. It is clear that the Court intended the rates to reflect market rates at the time the services were rendered, rather than at the time the affidavits were filed.” [P. 1080] I disagree that this inference is a proper one to be drawn from the district court’s opinion. But even if it is a proper one, it is not the only one. Too, I disagree that the evidence establishes that the hourly rates adopted by the trial judge were lower than the lowest market rate in each city supported by the evidence before the Court. The trial court’s opinion sets forth:

Based upon the affidavits submitted by the parties, legal fees now range from a low of $75.00 per hour to a high [the highest] of $150.00 per hour for in-court work.1 Having come on the bench approximately 2-V2 years ago when the highest range of fees in this locale were approximately $75.00 per hour, I find it difficult to determine that a fee of $90.00 per hour is not the figure which would be considered a reasonable fee for out-of-court work in this area for an attorney of Mr. Daly’s competence. It is significant that most of the hours for which Mr. Daly is claiming compensation were in 1982 and 1983, whereas the affidavits he has filed are based on 1984 hourly rates.

The trial court found that upon the affidavits submitted, legal fees now range from $75.00 per hour to $150.00 per hour for in-court time, as opposed to out-of-court time. Utilizing his personal knowledge, he stated that 2-V2 years earlier, “the highest range of fees in this locale were approximately $75.00 per hour. Applying those *1087facts to the Court’s finding and its allowance of $90.00 per hour in 1984 — the time when fees were being assessed — clearly indicates to me the Court was allowing the market rate for 1984.

Actually, appellants raised no issue on appeal of any failure of the trial court to apply 1984 hourly rates to the fees allowed, or any failure to make any allowance for the delay in payment of the value of the services rendered. What appellants do complain of is the Court’s failure to consider an adjustment of the lodestar fee to account for the excellent result obtained. But that is not what the majority deals with. Since the issue was not raised, it should not be dealt with on appeal. In any event, the hourly rates allowed were within the range of the hourly rates for similar services for 1984.2

As to the disallowance of items for costs, I agree that a party litigant entitled to recover his costs is entitled to recover reasonable items and reasonable sums. This was not a difficult case. It could have been brought at common law, as well as under § 1983 and in state courts. Civil rights cases are no longer novel or unusual. They require no more expertise than the usual civil case. The average lawyer in practice today is filing and prosecuting civil rights cases. Within the jurisdiction of each division of the federal courts there are a substantial number of lawyers possessing the required skills to handle even the most complicated civil rights cases.

In Ramos v. Lamm, 713 F.2d 546, 555 (10th Cir.1983), the opinion related that for 1982, more than one-sixth of the civil cases filed in federal courts were civil rights cases, and that more than 30% of the cases appealed to the Courts of Appeals were civil rights cases. The annual report of the Director of the Administrative Office of the United States Courts shows that for 1984 the percentage of private civil rights cases filed in the district courts and appealed to the Court of Appeals continues to be about the same percentage. The figures are approximately the same for the Fourth Circuit, in both the District Court and the Court of Appeals. [See p. 245-246, 254, 258 of the report]. Too, such cases can be, and are brought in the state courts. Because the law applicable to such cases has become well established, the time required to investigate, prepare and prosecute such cases is much less demanding. Hence, the costs and expenses reasonably necessary to be incurred are reduced. The items of cost and expense allowable are those “reasonably” incurred. The trial judge is to exercise his discretion in determining whether the sums claimed are reasonable, and were reasonably necessary and are properly documented. The trial court made an allowance of $4,028.10 out of a total request for $5,683.52. Among the items disallowed were $512.00 for out-of-pocket expenses for legal research, $135.21 for long distance telephone calls, $55.01 for postage, $351.08 copying charge, $219.60 for mileage and travel. The Court did allow $2,833.10 for depositions, copies and witness attendance fees and other items. The trial judge was exercising his judgment in eliminating any item not reasonably necessary. The burden was on applicants to properly justify each item of cost and expense, and show such item was applicable to this litigation. Each counsel included in his billing items for research, but in addition, billed for $512.00 for out-of-pocket research. Under the facts of this case the Court was justified in disallowing such an item, as well as the other items. It was appellant’s duty to *1088show when these items were incurred. The Court could then have dealt with them in a more positive way. For instance, if they were incurred long before the suit was filed, they are not necessarily recoverable. Webb v. Board of Education of Dyer County, held that compensation under § 1988 — which includes attorney’s fees, costs and expenses is that “reasonably expended on the litigation.” 105 S.Ct. at 1928. It held that time spent in administrative proceedings for items not a part of the litigation, and time spent during periods before the litigation was filed were not reasonable under § 1988. In the statement submitted by Mr. Street there was a request for allowance of fee for 78 different occasions prior to the time of filing this suit. Included were items for numerous telephone conversations with client, district attorney, witnesses and others, trips to plaintiff’s home, trips to the sheriff and district attorney’s office, trip to the scene of the occurrence, six trips to court, three trips to Charlotte, and numerous conversations and conferences, all of which were before the suit was actually filed. There is no way the trial judge could have determined what part of the telephone, travel or other items charged as expenses were chargeable as “reasonably expended on litigation.” If Mr. Street was not entitled to be compensated for the full number of hours charged — and the court found he was not — certainly he would not be entitled to costs charged for those hours. As a further indication of the unreasonableness of the account submitted, the account of Mr. Street shows that he had 25 separate conferences with his client before the suit was filed and 49 conferences with her after the suit was filed. These conferences ranged from twelve minutes to two hours. He charged for thirty telephone conferences with his client and her family before the suit was filed and some thirty-nine after the suit was filed, ranging from six minutes to forty-eight minutes. There is no showing of what the telephone charges are for, or when incurred. The same applies to the other charges for travel, copying, etc. The trial judge pointed out in his opinion that he counted some 84 different charges for “File Review” on different days and in some instances, on consecutive days, twenty-two of which were before this suit was filed. Strange as it may seem, one of the charges for “File Review” was on the third day after his first conference with his client.

In reducing the sums claimed for services and disallowing items of costs, the trial court pointed out that even with the reduction and disallowance the “costs which have resulted from this litigation are all out of proportion to the factual situation involved,” and the “fees requested here are a small example of an attempt to overcharge.” [Opinion — JA 193-194]

In view of the lack of proper identification and time for the expenses listed, and the unreasonableness of the account, the trial court properly exercised his judgment in denying such items. I would affirm on the opinion of the trial judge.

. Affidavits and stipulations in the record show that five attorneys said the current rates (1984) in Gastonia and Charlotte ranged from $65.00 to $100.00 per hour for in-court services. The allowances were $70.00 to Street and $90.00 to Daly for out-of-court services.

. By way of comment only, it seems to me incorrect to make allowance for delay in assessing or paying the sum awarded using the market rate at time of allowance and payment, rather than the rate when the services were performed. I am aware some courts have so held. Unless specifically provided by statute or contract, compensation for delay in payment is generally by allowance of interest. It seems to me that one required to pay the hourly rate for services should be charged the hourly rate at the time the services were performed, plus interest for delay in payment. Assume the hourly rate for labor is $10.00 per hour when the services are rendered, but $20.00 per hour at the time ordered paid. Such an increase would constitute a windfall, rather than just compensation or, assume the rate was $10.00 when rendered and $8.00 when ordered paid.