493 P.3d 580
Utah2021Background
- Barberry (two LLCs) owned a fractional interest in a Georgia apartment complex and entered a Property Management Agreement (PMA) governed by Georgia law.
- Daymark managed the property; it later sold or engaged Cottonwood, who allegedly became assignee/property manager or alternatively a subcontractor.
- Barberry sued in California (dismissed for personal jurisdiction) and then in Utah alleging breach of the PMA, interference, and fiduciary breaches; Cottonwood moved to dismiss.
- The PMA’s attorney-fee clause awarded fees "in any action or proceeding between Property Manager and the Tenants in Common."
- District court dismissed Barberry’s claims on multiple grounds, then awarded Cottonwood fees; the court said Cottonwood could recover fees under either Utah law (reciprocal-fee statute) or Georgia law (judicial admissions).
- Utah Supreme Court held contractual attorney-fee claims are substantive for choice-of-law, applied Georgia law, and affirmed the fee award; it also declined to disturb the fee amount because Barberry inadequately briefed that challenge.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether contractual attorney-fee claims are substantive or procedural for choice-of-law | Barberry: substantive; governed by contract's choice-of-law (Georgia) | Cottonwood: procedural; governed by forum (Utah) | Contractual attorney-fee claims are substantive for choice-of-law; apply Georgia law |
| Whether Cottonwood may recover under PMA fee clause given dismissal finding Cottonwood was a subcontractor | Barberry: clause covers only disputes between "Property Manager" and tenants; district court found Cottonwood not property manager, so no fees | Cottonwood: judicial admissions bind Barberry to its complaint allegation that Cottonwood was the assignee/property manager | Barberry’s complaint contained binding judicial admissions under Georgia law; Cottonwood may enforce the fee clause |
| Whether Georgia judicial-admissions rule applies despite district court’s dismissal reasoning | Barberry: district court resolved the factual issue on merits (treated Cottonwood as subcontractor), so judicial admission withdrawn | Cottonwood: Barberry never withdrew allegations; court did not actually decide the factual dispute on the merits for purposes of admission | Court concluded the dismissal did not constitute consideration on the merits that withdrew the admissions; Georgia rule applies |
| Whether the fee award amount was reasonable | Barberry: amount unreasonable; seeks reduction | Cottonwood: requested fees were reasonable and within court’s discretion | Amount affirmed; Barberry inadequately briefed the reasonableness challenge, so abuse-of-discretion review not met |
Key Cases Cited
- Federated Cap. Corp. v. Libby, 384 P.3d 221 (Utah 2016) (Utah choice-of-law rule distinguishing substantive from procedural issues)
- Waddoups v. Amalgamated Sugar Co., 54 P.3d 1054 (Utah 2002) (forum applies its own choice-of-law rules)
- Petty v. Clark, 192 P.2d 589 (Utah 1948) (definition of substantive law)
- Brown & Root Indus. Serv. v. Industrial Commission of Utah, 947 P.2d 671 (Utah 1997) (procedural law definition)
- Boswell v. RFD-TV The Theater, 498 S.W.3d 550 (Tenn. Ct. App. 2016) (contractual attorney fees treated as substantive for choice-of-law)
- Benchmark Builders, Inc. v. Schultz, 711 S.E.2d 639 (Ga. 2011) (contract interpretation governs entitlement to contractual fees)