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Continental Insurance Co. v. United States Fidelity & Guaranty Co.
552 P.2d 1122
Alaska
1976
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*1 COMPANY, CONTINENTAL INSURANCE Appellant,

UNITED STATES AND FIDELITY GUAR- COMPANY, Appellees. ANTY

No. 2547. Supreme Court of Alaska.

Aug. 4, 1976.

H23 Hughes, Thors- Jacobus, Kenneth P. Powell, Anchorage, ness, Lowe, Gantz & appellant. Henderson, Lytle, Roger Houston E. & appellee. Anchorage, for

OPINION BOOCHEVER, J., C.

Before BURKE, CONNOR, RABINOWITZ, DIMOND, Tern. Pro JJ., and J. RABINOWITZ, Justice. at- award of questions the This declaratory judgment torney’s fees insurers, United States two action between Continental Guaranty Co. Fidelity and issues at The substantive Insurance Co. concerned that action the core of of defense insurer had wrongful death recovery in and actual the de- tendered had suits. Continental Fidelity’s refusal Fidelity. Upon fense to defense, set- tender paying wrongful actions tled death Con- its insured. $250,000 behalf of $250,000 plus recovery of sought tinental Fidelity. These the costs of defense from In- in Continental answered issues were Fidelity and v. United States surance Co. 430 (Alaska Guaranty 1974),1 we held where that while ful death actions. Our mandate to the indemnify was not liable to Continental in court indicated that no costs or wrongful actions, death did owe a fees were appeal.3 allowed on duty to defend. We stated: Upon remand the court award- fact, vagaries

Given the in both Fidelity, law and ed party, *3 wrongful $18,836.16 the death actions were at attorney’s fees.4 This amount potentially least within the coverage of by Fidelity. included the full costs claimed policy Therefore, the U.S.F. & against $18,836.16 G. .... U.S.F. the award of & fees, G. should have undertaken the trial court offset two- [defend defense, Northern’s and the failure costs, sevenths of ant] Continental’s defense to do so was duty a breach of sulting the in net recovery Fidelity of of by defend $15,228.43. created the insurance cont ract.2 total amount of We concluded that Fidelity awarded, $18,836.16, should bear included the costs two-sevenths of Continental’s cost of by Fidelity de- claimed both before and after fending wrongful the death actions. an offer judgment, We which had been Fidelity also held that had no liability by Fidelity5 tendered in the course of the pay the damages recovered in wrong- original litigation, the and to the costs borne upon wrongful briefs, petitions memoranda, 1.The circumstances which the unless oth- predicated by death action was are in discussed erwise ordered the court. opinion. that A brief review of the facts See also AS 09.60.010. understanding should be of assistance the (Attor- 4. Alaska Rule of Civil Procedure 82 appeal. Corporation instant Northern con ney’s Fees) provides part: Cooper tracted with Robert for the Prevailing Party (a) Allowance to as Costs having Cooper haul rock in his trucks. Continental; Cooper’s Northern’s insurer (2) money judgment In actions where the Fidelity Guaranty was United States determining is not an accurate criteria for (hereinafter “Fidelity”). Co. As a result of prevailing side, the fee to be allowed to the Cooper the death of and one of his drivers the court shall award a fee commensurate hauling, in the course of an action was legal with the amount and value of services brought against Northern. in Northern’s rendered. surer, Continental, tendered defense to Fidel parties agreed money judgment ity theory Fidelity, on the under an om here was not an accurate criteria for de- policy nibus clause with Northern termining attorney’s fees. (which any organiza included the insured “legally responsible” provides: 5. tion Alaska Rule of Civil Procedure 68 the use of Cooper’s any trucks), days obligation had At time more than 10 before the to defend indemnify begins, party defending Upon against Fidelity’s Northern. re upon defense, party fusal of the tender of claim serve the adverse instant brought. against Ultimately, wrongful action was offer to allow be taken settled, money property paying death him action was for the or or to the ef- entirety specified offer, obligation fect his with costs then Northern’s under days agreement. accrued. If within 10 after the service settlement 528 P.2d at 431- adverse serves accepted, written notice that the offer is ei- 2. 528 P.2d at 435. Justice Rabinowitz dis- party may ther then and no- file sented, taking view that under the facts acceptance together proof tice of with the omnibus clause of the insurance contract thereupon service thereof and the clerk shall Fidelity being resulted in Northern’s insurer. judgment. accepted An offer enter Appellate 29(c) 3. Alaska Rule of Procedure shall be deemed withdrawn and evidence provides: except pro- is not thereof admissible Judgment ceeding Reversal or Order. In eases to determine costs. If the any judgment, finally of reversal this court of more obtained offeree is not superior court, order or decision of the than the the offeree must favorable appellant pe- costs shall be allowed the the costs incurred after the titioner, including preparation the costs that an made the offer. The fact offer is accepted reproduction preclude of the record and of the does not a sub- but not

H25 addition, follow if appeal. receives an Fidelity on affirmative recovery, grounded on Con- but rather is held that interest which superior court on party prevails ceased on defense claims the main Here costs of issues.8 tinental’s bar, in the Fidelity Fidelity’s poten the offer of case at the date made where as of $18,836.16 liability payment tial re Against of the judgment. actual covery fees, wrongful off- in the great death actions ly potential exceeded its defense for the set two-sevenths of Continental’s defense, recovery by cost of costs, net Fi- main issue resulting in a cannot Thus, said $15,228.43. be the cost of defense.9 delity of light potential lia indemnification point first Continental’s bility exposed in error in court was matter, supe say cannot par- “prevailing holding to be rior court erred Fi its conclusion that ty” fees within entitled to delity prevailing party. was the Rules of Civil Pro- *4 argues regardless Continental next argues that since it cedure. prevailing of whether it was money (two- party with- ultimately awarded 82, in the $3,670.13), Civil Rule the su- costs sevenths defense or as perior failing court erred in to it Fidelity of our determination that a result costs defend, prior and fees incurred duty not had to and judgment 68 tender- prevailing party. to Rule offer of was the by Fidelity. ed judgment The offer of The determination of which by Fidelity $8,001, plus made was for in- vested, party prevailing party is the Ultimately, terest costs. and Continental’s instance, judge’s the first the trial disc recovery amounted to less than offer. appeal only retion6 and is on reviewable 68, of Rule Rules of who abuse.7 Determination Procedure, of Civil prevailing encourage is to settle- automatically is does party not issue, though sequent liability main to the even not offer. When the of one original party by contention. He is extent another has been determined judgment, one in whose favor the decision verdict or verdict order or but judgment rendered and the entered. or extent of be remains to de- Sons, by proceedings, party & v. In Owen Jones Inc. R. Lems C. termined further Co., (Alaska 1970), adjudged judg- P.2d 312 497 an offer of liable make recovery progress sought $119,663.12 ment, which shall have same effect as an light payments made to a offer made if contractor. before trial it is served within recovery $7,363.- days pri- not ultimate affirmative reasonable time less than 10 plaintiff argued judge 12, hearings trial abused its or to the commencement of deter- liability. finding mine the that defendant was amount or discretion extent awarding $10,000 prevailing party as Liberty Co., Leasing v. 6. DeWitt 499 P.2d stated, “It was fees. This court (Alaska 599, 1972) ; Sons, 601 Owen Jones & had resolved clear the main issue been Co., 312, v. Inc. C. R. Lewis 497 P.2d 314 against appellants plaintiff] when [the (Alaska 1972). obligation appellee had no found that progress payments Liberty Leasing Co., 599, . v. . . 7. to refund its DeWitt 499 P.2d “ (Alaska 1972) ; Palfy Rice, not an immutable 497 at [I]t v. 473 P.2d P.2d 314. 601 (Alaska 606, 1970), rule obtains affirmative who 613 and cases cited prevailing recovery must considered the therein. (citations party.” P.2d at 313-14 497 v. In Buza 395 Columbia Lumber omitted). (Alaska 511, 1964) (footnotes omitted), 514 dictionary 9.Indeed, insurer defines we said: “ indemnify dictionary . . one that contracts . states that ‘PREVAILING predominant,’ applies esp. New . . Third another . .” Webster’s to that which is Compare, Dictionary by at 1173. has case law that International and it been established Guaranty g., e. United States to a suit is the one Williams, successfully prosecutes A. 660 148 Md. Go. v. who the action or successfully against it, prevailing (1925). defends pro- litigation and to avoid include 82(a) civil Civil Rule the allowance ment of fee, litigation.10 the offer ac- of an it is that the tracted 'When clear settled, pursuant cepted [plaintiffs] entitled and the action were is then vested with the trial court incurred to the date determining judgment. attor- of the offer of “wide discretion” ney’s fees, of fees will be and awards set Appellant seeks to Jakoski elevate only aside where it is discretion is shown mandatory to the level of a rule which clearly further abused.11 Civil Rule 68 requires judge a trial in to award costs provides proceed if the action does prior curred judgment an offer of judgment, . all instances. We decline to extend finally is not more obtained the offeree approved Jakoski that far. There we the offeree favorable than must the trial court’s exercise of discretion after the incurred awarding such costs; say here we cannot the offer.” judge his abused discretion Holland, Jakoski failing to award them. as there are Just (Alaska 1974), the 577-78 defendant made costs, sound reasons for awarding such an offer of there are reasons for doing First, so. plaintiffs’ recovery. exceeded The trial require Rule 68 itself does not that costs judge awarded offer of plaintiffs up to the time of the offer Thus, awarded. it is clear such awards judgment and then to defendant awarded are the trial Second, court’s discretion. *5 attorney’s fees incurred after that time. to automatically award such costs en appealed, contending Defendant that there courages offerees to continue pressing proper was no basis for the award Third, appellant’s suit. construction of attorney’s (plaintiffs’ attorneys fees Civil Rule 68 po would act discourage to kept inadequate records), and that tential offerors from making offers of inadequate award to him was in view of judgment general, in especially and as the his attorney’s affidavit to the effect that progresses mount, case and costs because fees incurred amounted almost twice as to by virtue of the tender of they offer ap- much as were awarded. In dictum we would be binding themselves to finance proved superior court’s attorney’s opponents.12 fees of their pre-offer attorney’s fees stating: general In we think appellant’s that in terpretation provides

Since the rule that encourage, would judgment discourage settlement, allow “with costs then ac- thereby defeat ing crued” and since costs under the intent Alaska underlying Civil Rule 68.13 (b) Dominick, plaintiff 10. Miklautsch v. time 452 P.2d assure that should it (Alaska proceed 1969). attorney’s fees, with suit even lost, only in the event would be those Larson, v. See Albritton Estate 428 P.2d fees incurred from that date hence. 1967). (Alaska 383-84 Albritton presented, we held that the record the fail- on argues 13.Continental also it was error attorney’s any presettlement ure to award fees superior for court to award was a not clear abuse discretion. attorney’s entire amount of its fees incurred simple example during 12. A will suffice to illustrate this ease at the trial level. This con- problem ruling such would occasion. A tention will be discussed As a sub- infra. point might bring argument appellant of this a suit of nuisance value asserts asking $100,000 damages. attorney’s the award to The defendant fees it may honestly $5,000, feel the suit is worth to its offer of was willing figure and be error. The same definite reasons which cause us to forego contingent attorney’s greater that, general, risk lia- hold awards of bility. appellant urges, Were we to rule as fees offerees are within trial court’s $5,000 applicable resolving discretion are defendant’s offer of as this days (a) point. before trial The award of would bind defendant fees is vested pay plaintiff’s preparation up judge. in the to that sound discretion of the trial costs

H27 Larson, v. Estate ty. See Albritton awards as automatic Just 1967). Con- (Alaska 383-84 prior to offers that the court’s sequently, we hold pressing offerees to continue encourage point not an abuse on this simply decision suit, make such awards refusals to ultimately discretion. the offeree the basis that on large as judgment as fails to recover in this Appellant’s third contention encourage ac- may act

offer tendered appeal is that was error on fairly ceptance do not of offers which Fidelity the attor part court’s infringement compensate the offeree appeal in the earlier ney’s fees it incurred conse- The automatic legal rights. of its ap opinion on to this court. In our obtaining judgment not more quences of whether, peal no mention was made unaccepted than an earlier favorable whom, and if so costs and Any addi- spelled in our Rule 68. are out However, in our fees be awarded. should consequences im- which a tional we directed that neither mandate poses normally in its discretion should was to be awarded costs record, supported by reasons so that IV, the Alas fees.14 Article Section IS of reviewing determine whether court can provides part that the ka Constitution been Here the su- discretion has abused. Supreme shall . make Court perior court failed to indicate reasons for practice and promulgate governing rules pre-offer attorney’s awarding fees to procedure criminal cases in civil and beyond the offeree the fact that all courts.” Pursuant constitu- prevailing party with- the offeror was promulgated Rule grant, this court tional of the rule. Rules, Appellate which vests the' dis- However, to determine costs and cretion previously as we indi- have appeals in this cated, pertaining to court. (ap- in no sense could Continental short, by general, this court pellant rule offeree) regarded “prevail- authority con- has the to award ing party” within the meaning of Rule 68 Supreme nection to the with an or Rule 82. Unlike situation And, by of our Holland, Court of Alaska. virtue Jakoski where the offeree was *6 case, pre- in we have mandate the instant prevailing party (though a within Rule 82 neither viously determined that Con- 68), consequently not within Rule had Fidelity tinental nor was to awarded right attorney’s a to some fees under that appeal first any pertaining to the rule, costs here it is difficult to conceive of a Thus, it was this we hold that court. why the reason offeree is entitled to re- superior court to have error for pre-offer attorney’s cover fees. While appeal in con- Fidelity awarded costs on superior court’s doing reasons for so are Rules, 29, Appellate of Rule clear, travention not the record here does disclose at in the case and the mandate issued appropriate an instance to accord the trial bar.15 ruling presumption court’s some of validi- supra. a read- 6, 7, supra,. Nothing It is clear from 14. See note in rules

Footnotes our ing Appellate Rule 29 that our decision of prevents judge awarding attorney’s a from attorney’s appeal fees on award not costs prior fees incurred to an offer of degree a limited fact that was based on the an offeror which less lia- to bility incurs appeal. parties prevailed In former both pay. addition, In than it offered to represented legal addition, there issues parties prevailing award of fees subject complex to differences were independent support under Rule 82 furnishes opinion this court. within awarding prevailing party this fees in- for judge judgment. prior 15. In the trial contained If a letter curred to its offer of we attorneys by record, appellee’s indicated virtue our hold that offeror directly paid expenses precluded recovering attorney’s which done and from fees work $8,182.50. pur- amounted to to the we defeat related to simple by discouraging Thus, pose this matter to deduct it be a of Rule 68 will from fees awarded. amount on remand such offers. ap- Fidelity’s legal costs on Appellant’s contention Continental. fourth Thus, Fidelity us peal it of discretion would have hold that is that was an abuse Fidelity trial full to be to award court award costs judge for the trial losing long as the party fees in- borne so amount of its entire Second, automatically. leading case on the award is made curred. Our issue not legal Fidelity argues that its actual costs awarding the full amount requested Penney greater were far than claimed be- fees is Malvo v. J. C. those requested attorney’s 1973). cause their fees did (Alaska 512 P.2d 575 attorney spent in superior in-house time Malvo the court awarded the include Thus, prevailing party this case. its entire documented at- asserts torney’s never was its full of attor- fees. There held that it was awarded cost we ney’s ‘manifestly . auto- fees. unreasonable’ matically of at- the full amount hold that the cost of in- We torneys’ prevailing is not an fee house counsel party.” 512 holding P.2d at 587. Our within the of our rules. Salaries grounded Malvo was considerations of paid a to in-house counsel are cost of do public policy underlying purposes and the ing enterprise business will bear Civil 82. In Malvo we concluded regardless particular of whether a suit that: purpose brought. rules re our par- of Civil Rule 82 is to garding attorney’s partially is to fees com tially compensate prevailing party pensate for the costs in the costs and fees incurred where such particular litiga curred as a of a result compensation justified and not tion, not to the salaries of those who penalize for litigating a claim employees are regular enterprise.18 good faith. Thus, view the award made 512 P.2d at 588.16 In the instant case it superior court an award of the full appears that Continental’s claims were liti- cost of fees and as a conse gated good faith.17 quence squarely we are faced with the opposition question whether the to Continental’s conten- full attor tions, Fidelity ney’s arguments justified advances two under support criteria of Unlike court’s award Malvo. the situa Malvo, full attorney’s First, tion in fees. contends that award here was not judge Malvo full “automatic” but was made awarded after the trial judge incurred “as policy,” a matter of considered the progress Nevertheless, while here case.19 judge exercised con- we are left with the sidered discretion in firm placing full conviction *7 16.Compare Holland, See, g., 2, supra. 569, Jakoski v. e. 520 P.2d note (Alaska 1973), 578 where we reiterated the holding operate encourage 18. This will not to good Malvo decision’s concern about faith and discourage the use of in-house counsel to purpose partial compensation the of in an of legal primarily work on matters which are judgment fer of context. independent vested in counsel. The outcome grounds (besides good The two the faith of any being uncertain, parties of lawsuit will appellant Malvo) which caused us to conclude by continue to seek to minimize their costs partial compensation that was what was possible, use house counsel where as contemplated rules, (1) under our were opposed by to the use of counsel bills his who judicial . (cid:127) . where in order to seek time. remedies, a must risk the full superior amount finding 19. This court made no imagination it takes garding good little parties. Rather, to foresee that faith of the party’s size of a major impact bank account will it held that full costs were to be awarded be- have.a accept on his access to the courts” and cause Continental failed to an offer of (2) engineering, as a judgment matter of social to some exceeded its recov- degree they ery. 569, should lie Holland, where fall. In v. tJalcosM 520 P.2d 579

H29 recovered defense at- on the costs awarding full its discretion abused opinion, it, this court’s earlier pursuant to think Fidelity. we Here to torney’s fees judgment date of from the controlling. are Jakoski Malvo and judgment. to date of Jakoski we said: running of held that of attor- ascertaining amount tender of stopped upon Fidelity’s interest suc- be allowed a defendant fee to ney’s Chism, v. judgment. In Davis the offer than less holding a verdict cessful 1973), held 475, we (Alaska 513 P.2d 481 use the should judge his judg- general rule an offer that as where in a case general criteria as same specifies only total amount ment which prevailing party. We is the a defendant prejudg- including as is to be construed criteria recently discussed such prejudgment We likened ment interest. there Penney C. Co. We Malvo v. J. there compensatory damages interest “manifestly it is unreason- that stated less is “[m]oney asserted that worth full automatically to award able” it is Davis clarified the later received.” by a attorney’s fees incurred in State and limited our earlier assertion recog- prevailing party, although we (Alaska Phillips, v. 470 P.2d 274 be situations might that there nized 1970), that ¿ward justified. be such an would where was reiterated that the allowance We carry . damages should 11 [a] compensat- partially of ac- the cause interest from time party. prevailing ing a accrues, reason some tion unless for an peculiar case such Holland, individual Jakoski 578-79 v. injustice. do an of interest would In the award (Alaska (footnote omitted). 1974) we cannot Con case at bar characterize here relies our discussion Continental declaratory judg tinental’s claims in its since proposition in Davis for vexatious, frivolous, or de ment suit as adjudged money has lost the use of the good void of faith. Nor can we find it, up ought compensated owed unreasonably pro any way Continental money ques- the time received. Thus, longed in this case.20 tion thus raises now wheth- we conclude that the award of full attor bar interest er the case at an award of ney’s aside. fees to be set must be held judgment after the offered could why We think the reasons injustice within work applicable equally Malvo held was error are Phillips. judge think that a trial We .21 here discretion, properly, as exercise of on a to award an offeree interest refuse specification Continental’s final judgment from the date of is that the error court erred when, through date pre failing interest (Alaska 1974), upheld to in Malvo 20. These factors we alluded we less an award of (1973), Penney prevailing party’s J. G. than half of the part: where we said after offer of citing recognize refused, Malvo. there Jakoski indicates that where (in party’s good losing have our concern with a faith did not evidence Malvo) equally applicable good and all of to awards of at- faith claim or defense torney’s *8 fees under Civil Jakoski Rule 68. the the justified, judge might not an choose held that is abuse of discretion to well were complete requested post-offer less than fees. full of fees award the to question faced Here we are with the it is an abuse whether of discretion to award 16, supra. 21. note See good full when in fees has been positions faith. It is clear the of the parties good g., were held faith. E. note supra.

1130 ultimately .if here, judgment finally recovers the offeree less ob- the view, tained offeree is not more than the our favor- amount offered. offer, able than the pay this flows from the functions the offeree must conclusion procedural of offers after the of the which the device ultimately offer.” The offeror is judgment serve. who successful under Civil 68 should not Rule judg offer of makes an When be paying burdened with the cost of in- ment, acknowledges legiti effect refused, terest after the offer is for this macy of a claim to the amount offered. is a cost of the of the litiga- continuation accepted, If that offer the lawsuit ends. that, is a tion. This cost under Civil Rule accept If the offeree does the offer not should be borne the offeree.23 ultimately prevails in an amount part, offer, part. very which exceeds the size Reversed affirmed Re- its judgment testimony validity proceedings of the manded for not inconsistent opinion. accept. of its to with this refusal But the failure accept to offer ultimately proves which

to judgment exceed the forces the offeror ERWIN, J., participating. not to its continue defense of the action and BOOCHEVER, money it, by Justice, retention of virtue Chief concur- of its prepared DIMOND, give ring, to with whom Pro offeree at Justice Again, Tem., judgment joins. time. ultimate ly is indicative the soundness of the of- separate that I must file con- I find evaluation, feror’s which trial court at glance currence on an issue which first may By take forcing into account. the might appear relatively por- minor be a money, offeror retain its the offeree majority opinion. tion of The upon defeats the rationale which awards holds that a trial court exercise its of prejudgment based, interest are name discretion as to whether not to ly» paying for the use wrongfully re has who money. tained offeror effect has rejected judgment, ceived and an offer of indicated it does not wish to retain that period filing of time between the money and the offeror’s retention can of the case the date the offer. I hardly regarded voluntary.22 as majority unnecessarily believe that the in-

Additionally, jects Civil 68 uncertainty ap- Rule can be read area into the to support the plication refusal pre- to award the of Civil Rule 68 which can judgment interest hamper attorneys deciding claimed Continental. whether to noted, supra, As provides part accept judgment, make an offer of or to course, mandatory 22. language Of in a narrow sense retention is of the rule would voluntary appear because the could offeror offer the instances where indicate that all money conditioning acceptance judgment, proves pre- without its to exceed the foregoing By judgment ought of suit. Were this to he the interest be awarded. case, however, statute, however, prejudgment of the offer of interest should judgment rule, namely, put litiga- right. end to as a See be awarded matter of AS tion, addition, ; Phillips, 45.45.010(a) would be defeated. as a State v. practical matter, (Alaska 1970). such view retention as is rec- This conflict “voluntary” ignore reality judge by holding would has onciled regard situation one where on a discretion to interest party foregoes legal right proves each to maintain than an less position (which potentially may its be vali- as a of suit and thus offer of cost dated) certainty in return for the of immedi- a resolution of within Rule 68. Civil Such believe, ate will, settlement. effectuate matter legislative prejudgment inter- intent to award Wright Of. Miller, unduly penalizing C. & A. Federal Prac- est who without (Civil) (1973). prepared opponent tice & Procedure at 56 § what opponent’s. “rightfully” State v. See Phillips, supra at 273 n. 6.

H3J plus be specified be for a sum holding will also such costs. offer. The such Attorney’s normally litigation computed over fees will be of additional likely source pro- on the of the frequently amount offer under either already contested too the of the “without trial” or allowance “non-contested” with reference visions schedule of Rule 82.2 attorney’s fees. example given by Under the dictum the ma- agree with the

I do not accepted, jority in is Footnote 12 it is of where desired an offer when is to make a discretion- “nuisance” of fees settlement offer of allowance $5,000.00, metaphor attorney of Alaska’s the should have dif- ary. To use no opinion ficulty adds streams, majority computing approximate the the glacial amount waters, the the fee be already murky whereas allowed. The silt amount of quite the offer terms of Civil can application accurately gauged of the be combined clarity. so that the produce party making 821 Rules 68 and should the offer will know total be amount four situations There are including incurred the allowable costs and judg- that an arise in event offer fee the event that the offer of- Rule 1) is ment made under 68: accepted. is rejected, is 2) offer accepted; fer is In the rejected, event that the offer is than. the plaintiff more and the recovers plaintiff if the more recovers than 3) offer is offer; offer, amount of the he be will entitled than jected, plaintiff and recovers less to a par- normal a prevailing allowance as offer, is still the amount of but ty and fees under the is re- prevailing party; the offer 4) and provisions of Civil Rule 82. jected, less than and the recovers is but not the amount of If the rejected and offeree prevailing party. recovers less than the amount of- prevailing party, fer but still he situation, first Under the offeree should receive reasonable allowance provisions entitled under the of the rule his prior costs and accrued to costs and to the date of the offer.3 majority in date the offer. The Finally, we have the involved explicably re situation states that Rule 68 does not present where offeree quire to an offer that costs recovers less than the amount of the spe be Rule awarded. 68 par- the prevailing judgment to cifies that the offer allow be ty. sued to recover taken then In Alas “with costs accrued”. $250,000.00 82, paid ka, on behalf at under Civil Rule costs include Northern Insurance in settlement of a torney’s The offer therefore must fees. Holland, 569, (Alas procedure Jakoski v. P.2d 578 520 1.Rules should construed 1974). harmoniously. Treadway, ka See State v. 88 420, 157, ; (1960) Zuni Ariz. ga 357 P.2d 158 following 2. 82 schedule: Rule has Gity Tucson, Ariz.App. 220, v. 5 425 122, (1967) ; v. McIn P.2d 124 Hoffmeister AVE- FEES IN ATTORNEY’S tosh, (Wyo.1961), reh. 361 680 P.2d RAGE CASES denied, 1 364 P.2d See also Barron and 823. Non- Without Holtzoff, Procedure, Federal Practice Trial Contested Contested ; Edition, (1960) Wright § Rules 139 2,000 $ First 15% 25% 20% Miller, Federal Practice and Procedure: Civ 3,000 Next $ 12.5% 20% 15% il, (1969). 1029 Rule Criminal § Of. 5,000 Next $ 10% 12.5% 15% 92; Appellate 46 and Rules 1 and Rule Civil $10,000 Over 5% 7.5% 10% Anchorage Scavenius, City v. 539 Holland, 578 3. Jakoshi (Alaska 1975). (Alaska 1974). previously We have held that Civil construed with Civil Rule should *10 wrongful $40,000.00 death case. It also its sought would still be prevailing attorney’s and defending fees in so, party. my If opinion, he is entitled wrongful appeal, death action. On we to costs and a reasonable attorney’s fee to held that Continental was not entitled to hand,, date of offer. On the other if $250,000.00payment made, recover the but there is a verdict, defense similarly if that was entitled to two-seventh’s the main issues are resolved in the favor attorney’s opinion pres- fees. on the defendant so that he is to be re- garded as the prevailing party, plain- ent correctly Judge affirms Carlson tiff is not entitled to any attorney’s fee in his holding pre- was the even for performed services during the vailing party though even re- portion of time to the judg- offer of $3,670.13. Sons, covered Owen Jones & permit ment. To the trial court to exer- Inc. v. C. R. Lewis 497 P.2d 312 cise discretion so as to award (Alaska 1972), directly in point. fee to a non-prevailing plaintiff who has refused an prevailing party, Since of favorable plaintiff to allow the placed Continental was not entitled to to be in a position better case, than if fees at all. In the Owen Jones no such offer had been made upheld rejected. award of plain- Since the $10,000.00 tiff is not prevailing despite party, to the defendant in the ab- plaintiff’s sence of $7,363.12 an offer recovery judgment, ultimate he would not be $119,663.12. only any on a entitled claim of It is allowance for at- torney’s fees. I fail why to see plain- entitled to an rejection tiff’s award of If an fees. offer of favorable offer of compromise, made, requires plaintiff continue, offered, covers less than the should make it discretionary plaintiff normally for the trial prevail- will still be the court to plain- such tiff his ing party. If, example, suit is filed fee. I do not believe $55,000.00 offer of Civil Rule 68 was intended to cause $50,000.00 rejected, any receiving such bizarre result.

Case Details

Case Name: Continental Insurance Co. v. United States Fidelity & Guaranty Co.
Court Name: Alaska Supreme Court
Date Published: Aug 4, 1976
Citation: 552 P.2d 1122
Docket Number: 2547
Court Abbreviation: Alaska
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