11 Certiorari was granted to consider a single issue
1
of first impression:
2
whether
RELEVANT FACTS 4
€ 2 The district court appointed a panel of commissioners who recommended that the appellant, Department of Transportation (DOT), pay $77,550 to the appellees, Norman Industrial Development Corporation, John R. Law, Jr. and Mildred D. Law (collectively, owners), in a condemnation proceeding. The owners rejected the offer and sought a jury trial. On February 6, 1997, the jury awarded $353,485.17 for the property allowing for the addition of prejudgment interest of $24,126.56.
{3 Relying on 27 0.S8.1991 $ 11-provid-ing for the recovery of attorney fees and costs in condemnation proceedings in which the jury awаrd exceeds the court appointed commissioners' recommendation by more than ten percent, the owners filed an application for attorney, expert and appraiser fees and costs on June 12, 1997. 5 Attached to the application is the contingent fee agreement entered between the owners and their attorneys dated March 9, 1995. The contract provides that if the case is tried to a jury and a verdict in excess of ten percent of the court-appointed commissioners' award is recovered, the attorney is entitled to the larger of: 1) hours expended times an hourly rate of $125.00; or 2) forty percent of the difference between the amount of the verdiet plus interest and the amount of the DOT's final offer. 6
15 THE LANGUAGE OF 27 OS.1991 § 11-PROVIDING FOR AN AWARD OF ATTORNEY FEES "ACTUALLY INCURRED"-PROHIBITS THE ADDITION OF AN INCENTIVE OR BONUS FEE TO THE ATTORNEY FEES AWARD IN A CONDEMNATION PROCEEDING WHEN THE FEE OBLIGATION IS CONTRACTUALLY SET.
T 6 The owners contend that the trial court had authority to assess a bonus or incentive fee through consideration of the factors outlined in State ex rel. Burk v. City of Oklahoma City, supra. 8 However, we agree with DOT's assertion that the plain language of 27 ©.8.1991 § 11 prohibits the award of a fee larger than the sum the owners are contractually obligated to pay.
17 Oklahoma courts are committed to the American Rule-every litigant is responsible for its own litigation expenses except to the extent that the rule has been modified by statute or contractual provision. 9 In derogation of the American Rule, 27 0.98.1991 § 11 shifts the attorney fee obligation to the government if a jury awards the property owner an amount exceeding the court appointed commissioners' recommendation by ten percent. In such cases, § 11 provides that property owners are entitled to recover reasonable attorney fees "actually incurred" due to the condemnation proceedings. At issue here, is whether the Legislature's use of the language "actually incurred" in the statutory provision limits recovery to an amount the landowner is contractually obligated to pay its legal representative.
18 The owners rely primarily on three cases-Oklahoma Turnpike Auth. v. Horn,
19 Further, Horn Morgan and Corbell are distinguishable. None of thе three opinions addresses the precise issue presented here-whether an award of an incentive or a bonus fee not encompassed within the contractual obligation between the landowner and counsel may be recovered under 27 0.8. 1991 § 11. Neither the facts of Horn nor Morgan indicate that the attorney fees amount at issue was governed by contract or that any incentive or bonus was included in the trial court's award. Rather, the Burk factors were considered in both cases to test whether the fee awarded was reasonable. Although the fee-shifting statute at issue in Morgan provided for the award of "reasonable attorney fees incurred", 13 the case did not involve a condemnation proceeding or legislative language limiting the fee to that "actually incurred."
11 10 Corbell v. State ex rel. Dept. of Transportation,
{11 Two of our decisions are instructive. Root v. Kamo Electric Coop., Inc.,
{12 In Oklahoma Turnpike Auth. v. New Life Pentecostal Church of Jenks,
[ 13 New Life also explains the distinction between a contract-based fee claim, as presented here, and one premised merely on prevailing party status in a condemnation action:
"... In [a contract-based fee claim], the condemnor must pay the landowner's obligation to its lawyer to the extent that the obligation is reasonable and legally enforceable. ... In [a prevailing-party situation], the lawyer's quest for the court's fee approval depends not on a contractual obligation but on a reasonable value of services necessarily rendered for the client who won. The winning party's lawyer must, of course, go forward with proof to establish all elеments of the plea.... While the amount of the fee in both instances is subject to the court's serutiny, a contract-based fee is governed primarily by the landowner's valid obligation to the lawyer. One who, as a third party, is adversely affected by the lawyer-landowner fee contract and challenges its amount or provisions has the burden of proving the obligation's unconseionability or unreason- ..." {Citations omitted. Emphasis in original.]
Here, the contractual obligation in itself has not been challenged as unreasonable. Rather, only the bonus or incentive fee awarded by the trial court is at issue.
' 14 Although neither Kamo nor New Life address the precise question presented relating to a bonus or an incentive fee, they do provide guidance on the issue. In both cases, this Court recognized that the outer limits of the losing condemnor's obligation for reasonable attorney fees actually incurred were defined by the landowners' contractual obligations to their counsel. The opinions comport with the overwhelming majority of judicial decisions which have considered fee-shifting statutes containing language similar to that found in 27 0.8.1991 § 11.
T 15 The majority of courts considering the issue find that the phrase "actually incurred" limits the attorney fees which may be awarded to the client's actual outlay or contractual obligation.
19
These courts reason that use of
1 16 We hold that the language of 27 0.8. 1991 $ 11
25
-providing for an award of attorney fees "actually incurred"-prohibits the addition of an incentive or bonus fee to the attorney fees award in a condemnation proceeding if the fee amount is set by contract. This determination is supported by: the Legislature's use of the term "actually inсurred" in the statutory scheme; our decisions in Root v. Kamo Electric Coop., Inc.,
CONCLUSION
T 17 The Court is mindful that landowners are constitutionally entitled to full compensation for property subjected to the government's eminent domain powers.
26
Just and fair compensation requires that owners be placed as fully as possible in the same position as that occupied before the government's taking.
27
Nevertheless, fee-shifting statutes
118 Because the owners' fee obligation was defined by contract, the award of a bonus or incentive fee based upon the factors outlined in State ex rel. Burk v. City of Oklahoma City,
COURT OF CIVIL APPEALS OPINION VACATED IN PART AND LEFT UNDISTURBED IN PART; TRIAL COURT AFFIRMED IN PART AND REVERSED IN PART; CAUSE REMANDED WITH INSTRUCTIONS.
Notes
. DOT filed certiorari on issues relating to the reasonableness of the attorney fees' award allowed to Attorney John H. Stout. Certiorari was denied on June 28, 2001.
. Although we reach the same result as that of the Court of Civil Appeals, we vacate the court's opinion to provide a precedential ruling on a question of substantive law not previously deter
We note that the owners filed an application for appeal-related attorney fees on May 8, 2000. The application was denied by the Court of Civil Appeals. The plea for the appeal-related fees is not renewed in the owners' petition for certiora-ri.
. Title 27 0.8.1991 § 11 provides in pertinent part:
"Where a condemnation proceeding is instituted by any person, agency or other entity to acquire real property for use as provided in Section 9 of this title and ... 3. If the award of the jury exceeds the award of the court appointed commissioners by at least ten percent (10%), the owner of any right, title or interest in such real property may be paid such sum as in the opinion of the court will reimburse such owner for his reasonable attorney, appraisal and engineering fees, actually incurred because of thе condemnation proceedings. Such determination by the court shall be appealable to the Supreme Court in the same manner as any other final order. The final award of such sums will be paid by the person, agency or other entity which sought to condemn the property."
. DOT did not dispute on appeal or in its certio-rari petition the owners' entitlement to attorney fees. Further, the reasonableness of thе attorney fees award was not questioned in the certiorari paperwork except to the extent of the award to John H. Stout-an issue not addressed in this opinion, see note 1, supra. Because the only issue presented is one of law concerning the bonus or incentive awarded under 27 0.$.1991 § 11, see note 3, supra, it is unnecessary to reiterate the underlying facts of the condemnation proceeding.
. In addition to requesting attorney fees and costs pursuant to 27 0.$.1991 § 11, see note 3, supra, the application also cites to 12 0.S. Supp. 1991 § 942 [Providing costs which may be awarded.]; 12 O.S. Supp.1996 § 3230 [Relating to deposition and witness fees.]; 27 0.S.1991 § 9 [Referring to the application of eminent domain provisions.]; and 69 0.$.1991 § 1203 [Relating to DOT's authority to acquire land for the construction of state highways.].
. The contingent fee agreement, entered on March 9, 1995, provides in pеrtinent part:
"... (b) In the event the case is tried to a District Court jury and a verdict is obtained that exceeds the Court-appointed Commissioners' award by at least 10%, then Attorneys shall be paid the greater of the hourly rate for their services set forth in paragraph (c) hereinafter, or forty (40%) percent of the difference between the amount of the verdict plus interest less costs, and the amount of the final offer of the Plaintiff, Department of Transportation, before suit was filed, recognizing that under the Oklahoma Supreme Court case of Root vs. Kamo Electric, Clients are entitled to be awarded an attorneys' fee to be paid by the Plaintiff, Department of Transportation, in an amount which will reimburse Clients for reasonable attorneys' fees actually incurred because of the condemnation proceeding. ... (c) In the event the case is settled prior to presentation of the issues to a jury and rendition of a verdict, or in the event the case is tried to a District Court jury and a verdict is obtained that does not exceed the Court-appointed Commissioners' award by 10%, the Clients shall pay Attorneys for services compensation based on an hourly rate charged by said Attorneys being $125/hour ..."
. In State ex rel. Burk v. City of Oklahoma City,
. State ex rel. Burk v. City of Oklahoma City, see note 7, supra.
. See, Moses v. Hoebel,
. Morgan v. Galilean Health Enterprises, Inc.,
. Sneed v. Sneed,
. See note 6, supra.
. Title 63 0.8. Supp.1992 § 1-1918 (F) providing in pertinent part:
"... If a violation or threatened violation of this section shall be established in any action, the court shall enjoin and restrain or otherwise prohibit the violation or threatened violation and assess in favor of the plaintiff and against the defendant the cost of the suit, and the reasonable attorney fees incurred by the plaintiff...."
. - Certiorari was deniеd in Corbell v. State ex rel. Dept. of Transportation,
. Title 66 0.$.1991 § 65 (D) provides in pertinent part:
"Where the party instituting a condemnation proceeding abandons such proceeding, or where the final judgment is that the real property cannot be acquired by condemnation or if the award of the jury exceeds the award of the court appointed commissioners by at least ten percent (10%), then the owner of any right, title or interest in the property involved may be paid such sum as in the opinion of the court will reimburse such owner for his reasonable attorney, appraisal, engineering, and expert witness fees actually incurred because of the condemnation proceeding...."
Because the 1991 version of the statute is identical to its 1981 counterpart, the current version is quoted.
. See also, State ex rel. Dept. of Trans. v. Oliver,
. Relevant legislative provisions are considered together to ascertain and give effect to the legislative will. McNeill v. City of Tulsa,
. Oklahoma Turnpike Auth. v. New Life Pentеcostal Church of Jenks,
. Wisconsin v. Hotline Indus., Inc.,
. Wisсonsin v. Hotline Indus., see note 19, supra; Thompson v. Commissioner of Internal Rev.,
. Liddycoat v. Ulbricht, see note 19, supra; Brunswick Floors, Inc. v. Shuman,
. Anderson v. Smith,
. United States v. 122.00 Acres of Land, see note 19, supra.
. Smith v. Kendall, see note 19, supra.
. Title 27 O.S.1991 § 11, see note 3, supra.
. The Okla. Const., art. 2, § 24; United States Const., Amend. 14; Oklahoma Turnpike Auth. v. New Life Pentecostal Church of Jenks, see note 18, supra.
. Oklahoma Turnpike Auth. v. New Life Pentecostal Church of Jenks, see note 18, supra.
. Fogerty v. Fantasy, Inc.,
. Attorney's fee awards are upheld absent an abuse of discretion. Oklahoma Turnpike Auth. v. Horn,
