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Building Construction Enterprises, Inc. v. Garry Meadows Construction Co.

October 24, 2007


The opinion of the court was delivered by: Garnett Thomas Eisele United States District Judge


Presently before the Court is Defendant Garry Meadows Construction Co., Inc.'s Motion to Award Attorney Fees, Costs and Prejudgment Interest filed on September 27, 2007. Plaintiff filed an belated response on October 22, 2007.

Defendant requests that the Court enter judgment in the amount of $19,880.00*fn1 for attorney fees, $9,797.15 for prejudgment interest, and $465.12 for costs and expenses incurred. Defendant calculates the prejudgment interest at an annual rate of 6% on the amount of $56,517.17 from February 22, 2005, the date of the last unpaid invoice. Defendant notes that the subcontract agreement provides that the non-prevailing party shall pay "all attorney fees, costs, and expenses." Plaintiff concedes that there is a contractual provision allowing Defendant to recover attorney's fees and that Defendant is the prevailing party. However, Plaintiff requests that the Court limit the attorney fee award and deny Defendant's request for prejudgment interest.

I. Attorney Fees

"The following factors are relevant in determining reasonable fees: 1) the experience and ability of the attorney; 2) the time and labor required to perform the service properly; 3) the amount in controversy and the result obtained in the case; 4) the novelty and difficulty of the issues involved; 5) the fee customarily charged for similar services in the local area; 6) whether the fee is fixed or contingent; 7) the time limitations imposed upon the client in the circumstances; and 8) the likelihood, if apparent to the client, that the acceptance of the particular employment will preclude other employment by the attorney." Phelps v. U.S. Credit Life Ins. Co., 340 Ark. 439, 442, 10 S.W.3d 854, 856 (2000). "While the courts should be guided by the foregoing factors, there is no fixed formula in determining the reasonableness of an award of attorney's fees." Id.

The Court notes that Defendant attempted to exclude the fees attributable to the Third Party Complaint and its dismissal in its request. The Court will subtract an additional 4.3 hours of work from the total time expended as attributable to the Third Party Complaint.*fn2 The Court declines to further reduce the award. After consideration of the factors noted above, the Court awards $19,020.00*fn3 in attorney fees to Defendant.

II. Prejudgment Interest

In Woodline Motor Freight, Inc. v. Troutman Oil Co., Inc., 327 Ark. 448, 453, 938 S.W.2d 565, 568 (1997), the Arkansas Supreme Court set forth the "general rule that prejudgment interest is not recoverable on claims that are neither liquidated as a dollar sum nor ascertainable by fixed standards." (citing 1 Dan B. Dobbs, Dobbs Law of Remedies: Damages, Equity, Restitution § 3.6(1), at 336 (2d ed.1993)). However, "[p]rejudgment interest is allowable where the amount of damages is definitely ascertainable by mathematical computation, or if the evidence furnishes data that make it possible to compute the amount without reliance on opinion or discretion." Id. (citing 47 C.J.S. Interest and Usury § 21 (1982)).

In Woodline, the Court upheld the trial court's denial of prejudgment interest because "it was impossible to compute the amount of . . . damages without reliance on opinion or discretion" because "[t]here was conflicting testimony as to whether the building needed to be completely torn down, or whether part of the structure could have been repaired," and the estimates as to each option "varied substantially." Id. at 454. Additionally, in Atlanta Exploration, Inc. v. Ethyl Corp., 301 Ark. 331, 339, 784 S.W.2d 150, 153 (1990), the Arkansas Supreme Court stated that if "a method exists for fixing an exact value on the cause of action at the time of the occurrence of the event which gives rise to the cause of action," prejudgment interest should be allowed, because one who has the use of another's money should be justly required to pay interest from the time it lawfully should have been paid."

Defendant seeks prejudgment interest on $56,517.17 at a rate of 6 percent per annum from February 22, 2005, which is the date of the invoice whereby Defendant made demand upon Plaintiff for payment for the work performed. Plaintiff argues that prejudgment interest should not be awarded because there was a dispute about whether it owed Defendant for the work performed, and until this Court determined the parties' respective contractual responsibilities, no one could know what was owed to whom under the contact. If the Court were to accept Defendant's argument, the Court cannot imagine a situation in which prejudgment interest would be awardable in a contract dispute case. Here, while the liability of the parties may not have been clear at the time the invoice was issued, damages in the amount of $56,517.17 were definitely ascertainable as of that date. The Court finds that Defendant is entitled to prejudgment interest on the sum of $56,517.17 accruing at a rate of 6% per annum from February 22, 2005.

III. Costs

Regarding the claimed costs, Federal Rule of Civil Procedure 54, entitled "Costs Other than Attorneys' Fees," provides in pertinent part:

Except when express provision therefor is made either in a statute of the United States or in these rules, costs other than attorneys' fees shall be allowed as of course to the prevailing party unless the court otherwise directs.

Fed. R. Civ. P. 54(d)(1). 28 U.S.C. ยง 1920 defines "costs" and sets forth the categories of trial expenses awardable to a ...

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