Marlow v. United Sys. of Ark. Inc.
2013 Ark. 460
| Ark. | 2013Background
- In 2008 Les Marlow and other appellants sued United Systems of Arkansas, Inc. and Glenn Petkovsek for breach of contract, breach of implied covenant of good faith and fair dealing, wrongful termination in violation of public policy, and related tort claims; defendants filed counterclaims.
- A jury returned defense verdicts, finding plaintiffs failed to prove their claims and that Petkovsek was not individually liable; United Systems won on its claims but with zero damages.
- United Systems and Petkovsek moved for attorney’s fees and costs; the trial court found both entitled but awarded fees and costs only to Petkovsek (totaling $164,758.90).
- Appellants appealed; the court of appeals affirmed, and the Arkansas Supreme Court granted review and considered the case as if originally filed there.
- Appellants argued (1) Petkovsek was not a "prevailing party" because the breach-of-contract claim implicated United Systems, not him; and (2) attorney’s fees are unavailable in wrongful-discharge (public-policy) suits.
- The Supreme Court affirmed the fee award: it held appellants had sued Petkovsek individually (so he was a party prevailed against), and wrongful-discharge claims sound in contract under Sterling Drug, so fees under Ark. Code Ann. § 16-22-308 are available in the court’s discretion.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Petkovsek was a "prevailing party" entitled to fees | Petkovsek was irrelevant to the breach-of-contract claim; not a prevailing party | Appellants named and sued Petkovsek individually; jury exonerated him, making him a prevailing party | Court: Petkovsek is a prevailing party; appellants invited the error by suing him and cannot now complain |
| Whether attorney’s fees are recoverable for wrongful-discharge (public-policy) claims | Fees not available because wrongful-discharge is based on implied/quasi-contract and fees under §16-22-308 require an actual contract | Under Sterling Drug wrongful-discharge sounds in contract; §16-22-308 permits fees in contract cases at court’s discretion | Court: Fees may be awarded for wrongful-discharge claims because they sound in contract; affirmed trial court’s discretionary award |
| Whether the fee amount was unreasonable | (implicit) appellants challenged availability, not amount | Appellees: amount reasonable | Court: appellants did not contest reasonableness; no reversible error on amount |
| Scope of appellate review and invited-error limitation | Appellants asserted Petkovsek irrelevant on appeal | Appellees invoked invited-error and preservation rules | Court: preserved issues control; invited-error doctrine bars appellant’s inconsistent attack |
Key Cases Cited
- Sterling Drug, Inc. v. Oxford, 294 Ark. 239, 743 S.W.2d 380 (Ark. 1988) (holds wrongful-discharge in violation of public policy sounds in contract)
- Boellner v. Clinical Study Ctrs., LLC, 2011 Ark. 83, 378 S.W.3d 745 (Ark. 2011) (limits appellate review to preserved trial arguments)
- Riley v. State Farm Mut. Auto. Ins. Co., 2011 Ark. 256, 381 S.W.3d 840 (Ark. 2011) (applies invited-error doctrine)
- Pettus v. McDonald, 343 Ark. 507, 36 S.W.3d 745 (Ark. 2001) (discusses implied-in-law contracts and their nature)
- Harrill & Sutter, P.L.L.C. v. Kosin, 2012 Ark. 385 (Ark. 2012) (prevailing-party analysis considers the case as a whole)
- Carter v. Cline, 2013 Ark. 398 (Ark. 2013) (recognizes that attorney’s fees are generally not recoverable in tort actions)