Busico v. CarverBusico v. Carver
Chase B. Ames, Nathan D. Anderson, and Michael D. Lichfield, Attorneys for Appellees and Cross-appellants
JUDGE RYAN D. TENNEY authored this Opinion, in which JUDGES DAVID N. MORTENSEN and JOHN D. LUTHY concurred.
Opinion
TENNEY, Judge:
¶1 In late 2018, Joe and Ann Busico contracted with Complete Construction to repair some damage that had been done to a condo they owned. After Complete Construction began its work, the Busicos became dissatisfied and terminated the contract. The Busicos later sued Complete Construction, raising several causes of action relating to breach of contract. Complete Construction counterclaimed, raising a contract claim of its own, as well as a claim seeking to foreclose on a construction lien that it had filed
¶2 Both parties have now appealed. In their appeal, the Busicos challenge the district court‘s denial of their request for the attorney fees they incurred defending against the lien foreclosure claim. In its cross-appeal, Complete Construction challenges the court‘s denial of its lien foreclosure claim, and Complete Construction also challenges the court‘s denial of its request for attorney fees relating to certain pretrial motions.
¶3 As explained below, we affirm most of the court‘s ruling on the lien foreclosure claim, though we do reverse one aspect of it. As a result of that reversal, we reverse the court‘s ruling on the Busicos’ request for attorney fees on the lien foreclosure claim, and we remand that issue for further consideration in light of principles set forth below. Finally, we reject Complete Construction‘s challenge to the denial of its request for fees relating to certain pretrial motions.
Complete Construction‘s Work and Construction Lien
¶4 Joe and Ann Busico own a condo in Salt Lake City, and Joe‘s mother Louise has an ownership interest in the condo as well. In 2018, Alexandra Busico (who is Joe and Ann‘s daughter) began leasing the condo from her parents and grandmother.
¶5 On September 5, 2018, Alexandra returned home after work and discovered that a sewer backup had caused raw sewage to flood onto the condo‘s floors. Alexandra soon submitted a homeowner‘s claim to the insurer. On September 20, Alexandra received a letter from the insurer denying coverage because, in the company‘s view, the backup was excluded under the homeowner‘s policy.
¶6 On September 27, the Busicos contacted Paige Carver. Carver owns and helps run Complete Construction, a company that specializes in “insurance rebuilds[,] repairs,” and “remodels” for residential projects. As part of her role, Carver typically made “the initial contact with the new claims,” after which she acted as the “go-between between the insurance company and the homeowner or business.” The Busicos contacted Carver because they had used Complete Construction on a project a few years earlier.
¶7 On September 27 or 28, Carver met with Ann and Alexandra at the condo and did a walk-through to assess the damage. At the conclusion of this walk-through, Carver told Ann and Alexandra that she thought the Busicos had a “really good shot” at getting the insurance company to cover the necessary repairs. She explained that the first step would be to get a plumber to certify where the clog in the sewage line was that had caused the backup, because this would help Carver determine whether the homeowners’ association or, instead, the Busicos’ insurer would be responsible for the damage. She explained that the next
¶8 The next day, Carver arranged for a plumber to come out to the condo, and the plumber soon completed the necessary work. Although the Busicos were responsible for paying the plumber (because they had not yet officially hired Complete Construction), Complete Construction paid the invoice in an attempt to move the project along. Around the same time, the Busicos personally removed some of the flooring, baseboards, and carpeting from the condo.
¶9 On October 4, Complete Construction submitted a bid to the Busicos for the proposed project, estimating the cost to be $11,106.88. On October 31, Joe, Ann, Alexandra, and Carver met with a claims adjuster from the insurance company at the condo. Complete Construction submitted a bid to the Busicos’ insurer later that day. On November 2, the Busicos’ insurance company agreed to cover Complete Construction‘s repair work on the condo. That same day, Alexandra directed Complete Construction to begin work.
¶10 On November 5, Carver sent a subcontractor to the condo with instructions to “sanitize [the] floors and hopefully . . . get to the kitchen sink.” Alexandra went to the condo that night. Although she didn‘t “see any evidence of any construction,” she noticed that someone had “started some carpet removal in the bedroom and the closet area” and that items had been “moved around in the kitchen underneath the sink.” Between November 6 and 20, the subcontractor returned to the condo several times to continue its work. During this period, its workers “pressure steam clean[ed]” some of the flooring in the condo and also used a “hospital grade disinfectant” to sanitize the areas that had been impacted by the sewage backup.
¶11 On November 20, Complete Construction purchased flooring materials that Alexandra had personally selected to
¶12 Between November 21 and November 30, the Busicos expressed frustration with various aspects of Complete Construction‘s work. Much of their unhappiness was about baseboards—Alexandra didn‘t want baseboards installed, but Complete Construction believed that baseboards were necessary with the kind of flooring that Alexandra had selected and that not installing baseboards would void the warranty. During this same period, the Busicos also complained about Complete Construction‘s work on other issues, including some wiring and electrical issues, issues relating to the flooring installation, and issues relating to drywall repair and removal.
¶13 On the morning of November 30, Complete Construction filed a preliminary lien notice with the Utah State Construction Registry. That same day, Alexandra returned to the condo during her lunch break and became unhappy with some work that had been done by Complete Construction‘s crew. Alexandra arranged for another construction company to come to the condo that day to survey the project and provide a second opinion. After consulting with this second company, Alexandra contacted the city “to find out if a permit had been filed,” explaining that she had been told by the second company that “a permit should have been filed” before performing some of the work that had been done. The city told her that no permit had been filed. Alexandra then had a locksmith change the locks on the doors so that Complete Construction would no longer have access to the condo. After doing so, Alexandra texted a picture of the removed locks to Complete Construction, faulted Complete Construction for not obtaining permits, and instructed Complete Construction to “come remove the flooring” that it had installed. Complete Construction‘s supervisor understood this text as being Alexandra‘s way of terminating Complete Construction from the project. At trial, Alexandra confirmed that by sending this text, she was indeed intending to terminate the contract.
The Busicos’ Complaint and Complete Construction‘s Counterclaim
¶15 On March 26, 2019, the Busicos filed a complaint against Complete Construction, pleading causes of action for breach of contract, intentional or negligent misrepresentation, slander of title, and a violation of the
¶16 On April 22, the Busicos’ counsel received an email from an attorney informing them that “Complete Construction [was] in the process of retaining” him and requesting a stipulation to extend the deadline to respond to the complaint by a few weeks. Upon receiving this email, the Busicos’ counsel quickly filed a motion with the court asking for a default judgment.
¶17 On April 24, the district court entered a default certificate in accordance with the Busicos’ motion. Later that day, however, Complete Construction filed an opposition to the motion for default judgment. There, Complete Construction asserted that the Busicos had failed to serve Complete Construction properly, and
¶18 On April 30, Complete Construction filed an answer and a counterclaim. In its answer, Complete Construction raised a number of defenses to the Busicos’ claims, including that the Busicos had failed to state a claim upon which relief could be granted, as well as that the claims were barred by such doctrines as waiver, estoppel, and unclean hands. In its counterclaim, Complete Construction pleaded three causes of action: (1) a lien foreclosure claim “pursuant to
¶19 The Busicos responded by filing a motion to strike the answer and counterclaim, arguing that Complete Construction had “failed to answer” the complaint “within the time period required by the Rules.” At a hearing in May 2019, the district court “set aside” the earlier default judgment for “good cause shown.”
¶20 Many months of litigation then ensued, during which Complete Construction prevailed on a number of disputes. For example, the district court sided with Complete Construction in a dispute about Complete Construction‘s statement of discovery issues, and the court also awarded Complete Construction the attorney fees it had incurred in connection with that dispute (though it reserved the question of how much it would award
¶21 The district court held a two-day bench trial in June 2021. Shortly before trial, Complete Construction filed a pretrial brief in which it asserted that, in light of the court‘s rulings limiting the Busicos’ damages claims, the “only remaining claim” from the Busicos that could be litigated at trial was their breach of contract claim. The Busicos did not file a pretrial brief of their own, and they did not dispute this characterization at trial. Indeed, they agreed with it. At the outset of his closing argument, for example, the Busicos’ counsel informed the court that there were “essentially two claims at issue in this case. The first is competing claims for damages under the parties’ agreement” (an apparent reference to the breach of contract claims), and “the second is the defendants’ claim for lien foreclosure.”3 (Emphasis added.)
¶23 Turning to Complete Construction‘s counterclaims, the court ruled in Complete Construction‘s favor on its breach of contract claim against the Busicos and awarded Complete Construction $8,499.15 in damages. The district court then dismissed Complete Construction‘s unjust enrichment claim with prejudice “as a result of Complete Construction prevailing on its breach of contract claim.”4
¶24 But the court ruled against Complete Construction on its lien foreclosure claim. The court relied on
¶25 With respect to that same claim, the court also addressed Complete Construction‘s assertion that it could alternatively recover for some of its work under “the five-day savings rule” set forth in
Competing Motions for Attorney Fees
¶26 After the district court entered its ruling, the parties filed competing motions for attorney fees. Complete Construction sought to establish the amount of attorney fees that it had previously been awarded on the discovery dispute. Complete Construction also asked the court to invoke its “inherent and equitable power” and award it the attorney fees it had incurred in defeating certain “vexatious and oppressive motions and claims.” Among others, Complete Construction referred to the Busicos’ attempt to obtain a default judgment despite having received notice that Complete Construction had obtained representation, as well as the Busicos’ assertion of various claims against multiple defendants who had only tenuous connections to the case.
¶28 After additional litigation relating to the attorney fee issues, the court issued its decision. The court first awarded Complete Construction $2,198 in fees relating to the earlier dispute about the statement of discovery issues. But the court then denied Complete Construction‘s request for attorney fees incurred in defeating the Busicos’ earlier motions. The court agreed that the Busicos’ prior counsel had litigated the case “overly aggressively” with respect to various motions and that the court had been forced to spend its “time dealing with things like defaulting represented parties, striking answers and counterclaim that had no basis in law whatsoever.” Even so, the court noted that it had awarded Complete Construction $2,198 in attorney fees in conjunction with the dispute over the statement of discovery issues, and it further noted that at least “some of that amount” was related to Complete Construction‘s response to the same motions at issue in the fee request. The court “decline[d] to exercise [its] discretion to go beyond” that, stating that the $2,198 was “as far as” the court would “go in terms of a fee award.”
¶29 Turning to the Busicos’ claim for attorney fees on the lien foreclosure claim, the court started by addressing the question of whether the Busicos were indeed the “successful party.” To answer that question, the court concluded that it should apply the “flexible and reasoned approach” outlined in I-D Electric v. Gillman, 2017 UT App 144, ¶ 42, 402 P.3d 802 (quotation simplified). The portion of I-D Electric relied on by the district court calls for courts to “consider the net judgment in the case and the amounts actually sought, and then balance them
(1) contractual language, (2) the number of claims, counterclaims, cross-claims, etc., brought by the parties, (3) the importance of the claims relative to each other and their significance in the context of the lawsuit considered as a whole, and (4) the dollar amounts attached to and awarded in connection with the various claims.
Id. (quotation simplified). Applying this test, the court first concluded that all of the claims and counterclaims at issue in this case “related to work performed at the property that was the subject of the lien,” and it then opined that the “claims were overly litigated as a result of the tactics undertaken by” the Busicos’ former counsel—including the initial default request, which, in the court‘s view, had “no legitimate basis.” The court also noted that it had rejected the Busicos’ various claims on either summary judgment or at trial and that it had ruled in Complete Construction‘s favor on its contract claim. In light of the litigation results as a whole, the court determined that the Busicos “were not the ‘successful’ parties” and accordingly denied their motion for attorney fees.
ISSUES AND STANDARDS OF REVIEW
¶30 As noted, this case involves both an appeal from the Busicos and a cross-appeal from Complete Construction, and the issues raised in the appeal and cross-appeal are intertwined. For analytical reasons, we‘ll address them in the following order and under the following standards of review.
¶31 First, in its cross-appeal, Complete Construction raises two challenges to the district court‘s dismissal of its lien foreclosure
¶32 Second, in their appeal, the Busicos challenge the court‘s denial of their request for attorney fees relating to their defense on the lien foreclosure claim. “Whether attorney fees are recoverable in an action is a question of law, which we review for correctness.” Martin v. Kristensen, 2019 UT App 127, ¶ 31, 450 P.3d 66 (quotation simplified). However, “we review the trial court‘s determination as to who was the prevailing party under an abuse of discretion standard.” Id. (quotation simplified).
¶33 Finally, in its cross-appeal, Complete Construction argues that the district court “erred in denying Complete Construction‘s request for attorney fees incurred in defending against” the Busicos’ “vexatious and oppressive motions.” We review this decision for an abuse of discretion. See Jensen v. Bowcut, 892 P.2d 1053, 1055 (Utah Ct. App. 1995).
ANALYSIS
I. Complete Construction‘s Lien Foreclosure Claim
¶34 Complete Construction argues that the district court erred in ruling that its preliminary notice was untimely, as well as in ruling that the savings statute did not apply. As explained in Part I(A), we disagree with Complete Construction‘s assertion that its preliminary notice was timely filed, but as explained in Part I(B), we agree with Complete Construction on its argument relating to the savings statute.
¶35 When a contractor claims that it was not paid for its work, the Utah construction lien statutes allow the contractor to place a lien on the property the contractor “worked on in the amount of the unpaid labor or resources contributed.” Zion Village Resort LLC v. Pro Curb U.S.A. LLC, 2020 UT App 167, ¶ 24, 480 P.3d 1055; see generally
¶36 Before 2011, the statute stated that “[c]ontractors, subcontractors, and all persons performing any services or furnishing or renting any materials or equipment used in the construction, alteration, or improvement of any building or structure or improvement to any premises in any manner” could file a lien upon the property in question.
(a) . . . to provide labor, material, or equipment for the purpose and during the process of constructing, altering, or repairing an improvement; and
(b) includes the scheduling, estimating, staking, supervising, managing, materials testing, inspection, observation, and quality control or assurance involved in constructing, altering, or repairing an improvement.
(a) means labor, service, material, or equipment provided for the purpose and during the process of constructing, altering, or repairing an improvement; and
(b) includes scheduling, estimating, staking, supervising, managing, materials testing, inspection, observation, and quality control or assurance involved in constructing, altering, or repairing an improvement.
¶37 As noted, the district court focused on the words “scheduling” and “estimating” from
¶38 In their briefing and again at oral argument, the parties spent much effort debating whether the court‘s conclusions about the scheduling and estimating components of this case were correct. Complete Construction relies on this court‘s decision in Pentalon Construction, Inc. v. Rymark Properties, LLC, where we said that “work” under these statutes “must be of the type that a person using reasonable diligence in examining the property would be able to see it and be on notice that lienable work was underway.” 2015 UT App 29, ¶ 10, 344 P.3d 180 (quotation simplified). Complete Construction asks us to adopt this as something of an overarching framework that would apply to all of the terms listed in the statute‘s definition of “construction work.” In Complete Construction‘s view, giving standalone force
¶39 This presents a potentially thorny question of statutory interpretation. But we ultimately need not decide whether the district court erred in relying on the “scheduling” and “estimating” components of the statute in this case. This is so because the preliminary notice filed by Complete Construction was untimely under different language from the same subsection that does plainly apply.
¶40 As noted, the definitions subsection states that “construction work” “means labor, service, material, or equipment provided for the purpose and during the process of constructing, altering, or repairing an improvement.”
¶41 Here, the district court accepted Alexandra‘s testimony “that cleaning and disinfection of the Condo by Complete
¶42 We conclude that this work qualified as construction work for purposes of this statute. By removing damaged flooring and then spraying various surfaces down with high-grade disinfectant, Complete Construction was attempting to ameliorate the damage done by the sewage backup, thus putting the condo back into good condition and restoring it to its previously habitable state. By doing so, Complete Construction was therefore providing “labor” and “service” “during the process of . . . repairing” the condo, which was enough to constitute construction work under
¶43 Complete Construction has not disputed that this work was done by the subcontractor or that it began on November 5, nor has Complete Construction argued that work done by the subcontractor couldn‘t be attributed to it for purposes of this statutory scheme. Cf.
¶44 But the cases that Complete Construction relies on for this argument were based on versions of the statute that predate the 2011 amendment described above. Complete Construction points to no case holding that this rule still applies under the version of the statute that post-dates the 2011 amendment. As noted, however, the 2011 amendment added “repairing” to the definition of “construction work.” And we have no difficulty concluding that the acts in question here—tearing up damaged flooring and then disinfecting damaged and infected surfaces—qualify as repairs. Because of this, we conclude that it qualified as “construction work” for purposes of this statute.
¶45 The remaining question, then, is whether Complete Construction‘s preliminary notice was timely. It was not. Again, Complete Construction was required to file its preliminary lien notice within 20 days of beginning construction work, and construction work began by November 5, 2018. But Complete Construction didn‘t file its notice until November 30. Because this was outside the 20-day window, the district court therefore did not err in concluding that the preliminary notice was untimely. It therefore committed no error in dismissing that portion of Complete Construction‘s lien foreclosure claim.
B. Savings Statute
¶46
¶47 Complete Construction argued below that, even if its preliminary notice was untimely under the initial 20-day rule, it was entitled to at least some relief under the savings statute. The district court disagreed, however, simply concluding that “there was insufficient evidence of what lienable work included in Complete Construction‘s invoice was performed on or after the fifth day after the preliminary notice was filed.” The court provided no further explanation for this portion of its ruling. Complete Construction challenges that ruling in its cross-appeal, and we agree with Complete Construction on this point.
¶48 As noted, Complete Construction filed its preliminary notice on November 30, 2018. Under the savings statute, Complete Construction would therefore have a claim for any construction work that it performed five days or more after that date. At trial, Joe Busico and Paige Carver both agreed that on December 6, 2018—which is more than five days from November 30, 2018—Complete Construction returned to the condo and removed the flooring that it had previously installed. In their briefs to us on appeal, the Busicos do not dispute that this work occurred on that date. Instead, the Busicos affirmatively agree that “Complete Construction‘s crew removed flooring from the Busicos’ Condo on December 6, 2018.”
¶49 Again, the statute in question defines “construction work” as including “labor, service, material, or equipment provided for the purpose and during the process of constructing, altering, or repairing an improvement.”
¶50 The Busicos nevertheless suggest that under All Clean, Inc., 2011 UT App 370, ¶ 14, construction work must “add value” to be lienable. From this, the Busicos argue that “undo[ing] what was done” to a property does not “add value.” But All Clean, Inc. was decided under the previous version of the statute. As noted, the legislature amended the statute in 2011, and we‘ve concluded that the work in question qualified under the current version of the statute.8
II. The Busicos’ Request for Attorney Fees on the Lien Foreclosure Claim
¶52 After the district court dismissed Complete Construction‘s lien foreclosure claim, the Busicos requested the attorney fees that they had incurred defending against it. The Busicos relied on
A. Successful Party
¶54
¶55 In some (if not many) circumstances, a court‘s analysis of who the “successful party” is for purposes of an attorney fee
¶56 But the provision in question here does have an internal qualification. Again, it states that “in any action brought to enforce any lien under this chapter[,] the successful party shall be entitled to recover reasonable attorney fees.”
¶58 Aspen appealed, and when the case ultimately arrived at the supreme court, one of the questions at issue was the scope of the “successful party” analysis under this statute. The supreme court answered that question as follows:
We emphasize, however, that a court should look only to the parties’ claims and counterclaims relating directly to the specific mechanic‘s lien at issue. Stated another way, when assessing which party is the “successful party” under the mechanic‘s lien statute, a court should confine itself to consideration of only those claims relating directly to both the particular property on which the mechanic‘s lien action is asserted and the particular work on which the mechanic‘s lien action is based.
Id. ¶ 17 n.5. Notably, when the supreme court applied this framework to the dispute at issue, the court took into account both the lien foreclosure action filed by Whipple and the counterclaims from Aspen that “relat[ed] directly to the mechanic‘s lien action
¶59 We offered additional clarification on this provision in Ellsworth Paulsen Construction Co. v. 51-SPR, LLC, 2006 UT App 353, 144 P.3d 261. There, we recognized that “under the mechanic‘s lien statute,” a party “is not entitled to attorney fees incurred in pursuing its nonlien claims which were completely separate.” Id. ¶ 47 (quotation simplified). But we then recognized that attorney fees relating to a “breach of contract claim” at issue in the case were “so inextricably tied to the mechanic‘s lien claim” that it warranted “grouping these fees together.” Id. We explained that “it almost goes without saying that a breach of contract claim is typically such an integral part of a mechanic‘s lien claim that a party cannot pursue such a claim without also proving the existence of a contract, a payment due under the contract, and a breach of that contract by nonpayment.” Id.
¶60 Our supreme court later reinforced this overall construct in Jordan Construction, Inc. v. Federal National Mortgage Association, 2017 UT 28, 408 P.3d 296. There, the court was again confronted with a “successful party” question under this same statutory provision. See id. ¶¶ 65–70. In considering the question before it, the supreme court did not strictly confine itself to the parties’ successes on the lien foreclosure action alone. The court noted that one of the parties (FNMA) had successfully defended itself against a separate claim for “declaratory relief” that had been filed by the other party (Jordan Construction). Id. ¶ 14. That declaratory relief action had sought to bind FNMA to findings of fact and conclusions of law that had been entered against yet another party in earlier portions of the case that involved claims for “breach of contract, unjust enrichment, promissory estoppel, conversion, and foreclosure of [a] mechanic‘s lien.” Id. ¶¶ 8, 11, 14. Thus, even though litigation on that declaratory relief claim was separate from litigation on the mechanic‘s lien claim, the
¶61 Given all this, we disagree with the Busicos’ assertion that the successful party analysis in this case should be strictly limited to the parties’ successes on the lien foreclosure claim alone. True, the district court does not have unfettered license on remand to consider any and all litigation between these parties. But the court may consider the parties’ successes on any “claims relating directly to both the particular property on which the mechanic‘s lien action is asserted and the particular work on which the mechanic‘s lien action is based.” A.K. & R. Whipple Plumbing & Heating, 2004 UT 47, ¶ 17 n.5. And in doing so, the court may consider the parties’ successes on any claims that were “inextricably tied to the mechanic‘s lien claim,” which would include, among others, litigation on any breach of contract claim that was linked to the lien. Ellsworth Paulsen Const. Co., 2006 UT App 353, ¶ 47.
B. Flexible and Reasonable Approach
¶62 The next question is the extent to which the so-called “flexible and reasoned” approach to the attorney fee question applies to this case.
¶63 In A.K. & R. Whipple Plumbing & Heating, our supreme court held that the “successful party” determination is not limited to which party received the “net judgment.” 2004 UT 47, ¶ 26. Rather, the court adopted a “flexible and reasoned approach,” under which courts “use their common sense in deciding whether a party was ‘successful’ in bringing or defending against a mechanic‘s lien enforcement action.” Id. Under this approach, courts consider “the net judgment in the case and the amounts actually sought,” and courts then “balance them proportionally with what was recovered.” I-D Elec. Inc. v. Gillman, 2017 UT App 144, ¶ 42, 402 P.3d 802 (quotation simplified). Courts also “consider[] common sense factors,” such as
- (1) the contractual language, (2) the number of claims, counterclaims, cross-claims, etc., brought by the parties, (3) the importance of the claims relative to each other and their significance in the context of the lawsuit considered as a whole, and (4) the dollar amounts attached to and awarded in connection with the various claims.
Id. (quotation simplified).
¶64 As noted by the Busicos, we‘ve held that a district court need not employ the flexible and reasoned approach if it is “manifestly obvious which party was the successful one.” EDSA/Cloward, LLC v. Klibanoff, 2008 UT App 284, ¶ 14, 192 P.3d 296 (quotation simplified); accord Westmont Mirador LLC v. Shurtliff, 2014 UT App 184, ¶ 11, 333 P.3d 369; Giles v. Mineral Res. Int‘l, Inc., 2014 UT App 37, ¶ 10, 320 P.3d 684. In their arguments to us, the parties disagree about whether it should have been manifestly obvious to the district court that the Busicos had prevailed. But those arguments were responsive to a prior world in which the district court had ruled in the Busicos’ favor on both aspects of the lien foreclosure claim. We‘ve now reversed the district court‘s ruling on the savings statute aspect of that claim, and under the resultant posture of this case, we don‘t regard it as being manifestly obvious who the successful party was for purposes of this fee request.
¶65 In other contexts, we‘ve recognized that because “the identity of the prevailing party depends, to a large measure, on the context of each case, . . . the district court is in a better position” than an appellate court to decide whether a party should receive its fees. North Fork Meadows Owners Ass‘n, Inc. v. Dove, 2023 UT App 107, ¶ 23, 537 P.3d 258 (quotation simplified); accord Utah Transit Auth. v. Greyhound Lines, Inc., 2015 UT 53, ¶ 58, 355 P.3d 947. The same would be true with respect to a “successful party”
III. Complete Construction‘s Request for Attorney Fees under the District Court‘s Inherent and Equitable Power
¶66 “In Utah, attorney fees are awardable only if authorized by statute or by contract.” Silva v. Silva, 2018 UT App 210, ¶ 26, 437 P.3d 593 (quotation simplified). “However, in the absence of a statutory or contractual authorization, a court has inherent equitable power to award reasonable attorney fees when it deems it appropriate in the interest of justice and equity.” Stewart v. Utah Public Service Comm‘n, 885 P.2d 759, 782 (Utah 1994), superseded on other grounds by
¶67 In its cross-appeal, Complete Construction invokes this power and argues that the district court abused its discretion by denying Complete Construction‘s request for attorney fees that it incurred in defending against the Busicos’ “vexatious and oppressive motions.” Before answering that question, we first note some disagreement between the parties about whether this
¶68 We see no definitive answer to this question in the cases. In one unpublished case, we did suggest that a district court‘s inherent equitable power was unavailable where a particular statutory attorney fee provision “clearly applie[d].” See In re A.B.W., 2004 UT App 101U, para. 2 n.1. But in another case, we considered a request to invoke our “inherent equitable power to award fees in the interest of justice and equity” alongside a request for fees under
¶69 Moreover, it‘s true that Stewart suggested that this power exists “in the absence of a statutory or contractual authorization,” 885 P.2d at 782—a framing that seemingly implies that the
¶70 But we ultimately need not decide whether the Busicos or Complete Construction are correct about this. Assuming for sake of argument only that the district court could invoke its inherent equitable power in this case despite the existence of the seemingly similar statute, we still see no basis for overturning the court‘s decision not to do so. Again, a court‘s decision to award (or not award) fees under its inherent equitable power is discretionary. See Rehn, 2017 UT App 21, ¶ 32. And a court that is tasked with “making an equitable award of fees” under this power “is concerned not with a party‘s legal entitlement to an award, but with the equities.” Id. (quotation simplified).
¶71 In modern litigation, attorney fees are very often awardable through statute, rule, or contractual agreement. Given this, we assume that it will be the rare case where a party successfully obtains attorney fees under a court‘s equitable power. And given the deferential nature of our review, it will be a decidedly rare case where an appellate court will reverse a trial court‘s decision declining to employ those powers—particularly if an award of attorney fees was potentially in play through some other mechanism and fees were not ultimately awarded.
¶73 It‘s true that the district court expressed some concern about these very motions. In its ruling on Complete Construction‘s request for attorney fees, the court observed that the Busicos’ prior counsel had taken an “overly aggressive[]” litigation position with respect to these motions, and it noted that it had been forced to spend its “time dealing with things like defaulting represented parties, striking answers and counterclaim that had no basis in law whatsoever.” But the court still declined to grant Complete Construction‘s request for attorney fees. The court noted that it had already awarded Complete Construction $2,198 in attorney fees in conjunction with the dispute over the statement of discovery issues, and it further noted that at least “some of that amount” was related to Complete Construction‘s response to the same motions at issue here. The court then “decline[d] to exercise [its] discretion to go beyond” that, stating that the $2,198 award was “as far as” the court would “go in terms of a fee award.”
¶74 An “abuse of discretion occurs only if it can be said that no reasonable person would take the view adopted by the district court,” and our review of such discretionary decisions is “necessarily context specific.” State v. Edwards, 2023 UT App 23, ¶ 15, 527 P.3d 826 (quotation simplified). While the court acknowledged that the motions in question were not meritorious, the question before it wasn‘t confined to the merits of the motions alone. Rather, the question before it was whether “justice and equity” should cause it to award attorney fees, see Stewart, 885 P.2d at 782, a question that naturally encompassed both these motions and even the litigation as a whole. The court was in a far
CONCLUSION
¶75 For the reasons set forth above, we affirm the district court‘s conclusion that the preliminary notice was untimely, but we reverse its conclusion that Complete Construction was not entitled to relief under the savings statute. We also reverse the district court‘s denial of the Busicos’ request for attorney fees relating to the lien foreclosure action, and we remand for further consideration of that request in light of the principles expressed above. Finally, we affirm the district court‘s denial of Complete Construction‘s request for attorney fees under the court‘s inherent equitable power.
Notes
Regardless, even under the Busicos’ own framing of the events, this work did add value. The Busicos instructed Complete Construction to remove this flooring because the Busicos apparently wanted to replace it—either with similar flooring that was installed differently, or, perhaps, with different flooring altogether. Either way, the Busicos thought this flooring needed to be removed so that they could have someone else install flooring that conformed to their desires. Removing this flooring (continued…)