Cuspide Properties, Ltd. v. Earl Mechanical Servs., Inc.
2017 Ohio 5680
| Ohio Ct. App. | 2017Background
- Earl Mechanical filed a mechanic’s lien in 2007 on equipment installed for Community ISP (CISP) on property leased from Cuspide; Cuspide sued in 2008 for quiet title and slander of title.
- Earl Mechanical counterclaimed against both CISP and Cuspide; summary judgment was later entered for Cuspide and CISP on most claims, leaving only damages for slander of title.
- On remand from this court, the trial court held a hearing on damages limited to special damages (attorney fees) for clearing the cloud on Cuspide’s title.
- Cuspide’s only witness was Jeffrey Klingshirn (non‑lawyer owner/manager of CISP/Cuspide), who testified about a shared retainer arrangement and that Cuspide paid $26,000 toward the retainer for fees through 2012; no itemized bills, hours, or prevailing hourly rates were produced.
- The trial court awarded $26,000 in attorney fees, taking judicial notice of its docket; the court of appeals reversed, holding Cuspide failed to prove necessity and reasonableness and the trial court erred in relying on judicial notice of the docket.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Cuspide proved necessary and reasonable attorney fees as special damages for slander of title | Cuspide: retainer payments and Klingshirn’s testimony establish necessity/reasonableness and $26,000 award | Earl Mechanical: plaintiff must show hours, hourly rate, and independent evidence of prevailing rates; retainer alone insufficient | Held: Cuspide failed to prove hours or prevailing rate; award unsupported and trial court abused discretion |
| Whether trial court could rely on judicial notice of its docket to assess fee reasonableness | Cuspide: court’s docket reflects case activity supporting the fee award | Earl Mechanical: judicial notice of docket inappropriate for factual determination of fees | Held: Court cannot take judicial notice of docket to determine necessity/reasonableness except in narrow circumstances; use here was improper |
| Whether attorney fees for defense of Earl Mechanical’s counterclaims were recoverable | Cuspide argued fees related to clearing title are recoverable as special damages | Earl Mechanical contended fees included work defending counterclaims and thus not properly allocated | Held: Issue not reached on the merits because primary award was vacated for insufficient proof; related assignments deemed moot given reversal |
| Appropriate standard for fee determination | Cuspide relied on retainer and result; trial court accepted that evidence | Earl Mechanical urged lodestar approach (hours x rate) plus independent evidence of community rate | Held: Court reiterates lodestar as starting point and need for evidence of hours, hourly rate, and expert/unbiased evidence of prevailing rate |
Key Cases Cited
- Green v. Lemarr, 139 Ohio App.3d 414 (Ohio Ct. App.) (attorney fees may be special damages in slander of title)
- Blum v. Stenson, 465 U.S. 886 (U.S. 1984) (party seeking fees must prove necessity and reasonableness)
- Bittner v. Tri-Cty. Toyota, Inc., 58 Ohio St.3d 143 (Ohio 1991) (lodestar: hours x prevailing hourly rate as starting point)
- Gisbrecht v. Barnhart, 535 U.S. 789 (U.S. 2002) (lodestar and adjustment principles for fee awards)
- In re Estate of Verbeck, 173 Ohio St. 557 (Ohio 1961) (limitations on judicial notice of court docket for factual determinations)
- Brandon/Wiant Co. v. Teamor, 135 Ohio App.3d 417 (Ohio Ct. App.) (same limitation on taking judicial notice of docket)
- Gioffre v. Simakis, 72 Ohio App.3d 424 (Ohio Ct. App.) (court cannot substitute docket review for proof of fees)