Farmer v. Arabian American Oil Co.

31 F.R.D. 191, 6 Fed. R. Serv. 2d 1008, 1962 U.S. Dist. LEXIS 5931
CourtDistrict Court, S.D. New York
DecidedSeptember 11, 1962
StatusPublished
Cited by26 cases

This text of 31 F.R.D. 191 (Farmer v. Arabian American Oil Co.) is published on Counsel Stack Legal Research, covering District Court, S.D. New York primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Farmer v. Arabian American Oil Co., 31 F.R.D. 191, 6 Fed. R. Serv. 2d 1008, 1962 U.S. Dist. LEXIS 5931 (S.D.N.Y. 1962).

Opinion

WEINFELD, District Judge.

The plaintiff who was unsuccessful in his action for breach of contract of employment, seeks to review the taxation of costs by the Clerk of the Court which have been allowed in the sum of $11,-900.12.

There have been two trials, each to a jury. The first resulted in a disagreement following which the Trial Judge granted the defendant’s motion for a directed verdict as to which he had reserved decision, and thereupon judgment was entered in favor of the defendant.1 Upon appeal this judgment was reversed and a new trial ordered.2 Upon the second trial before this Court the jury returned a verdict in the defendant’s favor„

Plaintiff, a physician who specialized in ophthalmology and practiced in Texas, alleged that he had been engaged by the defendant to head up the ophthalmology service of its hospital in Saudi Arabia for as long as the defendant continued to operate its oil wells there; that after he had entered upon the performance of his duties in Saudi Arabia, he had been wrongfully discharged. Although the issues presented by the plaintiff’s claim were, as this Court instructed the jury, “comparatively simple,” 3 costs have been taxed in the staggering sum of $11,900.12. The Court is persuaded that a substantial number of these costs, while they may well have been incurred in serving the convenience of the defendant and its attorneys, cannot be justified as necessary in resisting the plaintiff’s claim.

Undoubtedly, parties to a litigation may fashion it according to their purse and indulge themselves and their attorneys, but they may not foist their extravagances upon their unsuccessful adversaries. To sanction such a policy may result not only in harassing a litigant, but may even deprive him of his day in court, particularly where, as in the instant case, there is great disparity in the financial resources of the parties. Fear of imposition of astronomical costs should not be a deterrent against the assertion of legitimate disputes ;4 nor should one who in good faith brings an action be penalized because he has failed to carry his burden of persuasion.5 While this defendant, as the Court of [194]*194Appeals observed, “ * * * with its rich resources may well wish to try the case expensively * * 6 it, as the successful litigant, is entitled to tax costs only in amounts specified in applicable statutes and, where not expressly specified, the allowable costs must not only be reasonable but necessary in resisting the plaintiff’s claim.

Rule 54(d) of the Federal Rules of Civil Procedure, 28 U.S.C.A., which provides that costs “shall be allowed as of course to the prevailing party unless the court otherwise directs”, vests discretion in the court in passing upon the necessity and the reasonableness of the costs.7 The policy of the Federal Courts has been to keep litigation costs down—as particularly enunciated in Rule 1 of the Federal Rules of Civil Procedure, “ * * * to secure the just, speedy, and inexpensive determination of every action.” The court’s discretion should be exercised in conformity with that policy to avoid “ * * * making the federal court a court only for rich litigants.” 8

The plaintiff first challenges the allowance by the Clerk in a lump sum of $6,601.08, the full bill of costs as taxed after the first trial. Plaintiff seeks dis-allowance thereof upon the ground that the prevailing party is only entitled to tax costs of that trial in which he was ultimately successful. I do not agree. A prevailing party is entitled to tax all costs reasonably and necessarily incurred in either the prosecution or defense of a suit, and if more than one trial is required before a final result is achieved, the measure of taxable costs is not proscribed by that trial in which he finally prevailed.

Neither do I agree with the defendant’s position that since the Presiding Judge at the first trial reviewed the taxation of costs, the plaintiff may not now challenge them. The reversal by the Court of Appeals of the first judgment in the defendant’s favor necessarily resulted in the vacatur of the entire judgment including the costs which were a component part thereof. In fact, upon reversal of that judgment, the bill of costs which had been allowed upon review was formally vacated by an order entered in this Court. Accordingly, upon conclusion of the second trial the defendant as the prevailing party had the right to tax costs anew, whether claimed in connection with the first or second trial; and the plaintiff as the losing party equally had the right to have them reviewed de novo. Since the second trial was held before this Court it is in a position, against the background of both trials, to make a determination as to whether the various items were properly allowed by the Clerk either as mandated under statute or as reasonable and necessary.

Parenthetically, it should be noted that the Court of Appeals, in reversing an order directing the plaintiff herein to furnish security for costs, commented with respect to travel expenses of witnesses, daily transcripts of the first trial and stenographic fees for pretrial hearings and examination of witnesses that there was no convincing showing of their necessity.9 While concededly the Court of Appeals’ critical reference is obiter dictum, it is clear that it entertained serious doubt as to the allowance of those items.

The principal items attacked are transportation charges for bringing em[195]*195ployees of the defendant or its former employees, either from Saudi Arabia or from distances within the United States beyond the subpoena power of the Court to testify at the trials. Three witnesses were brought here from Saudi Arabia for the first trial. One travelled on a private carrier and his transportation and expenses were taxed at $1,531.50. The other two witnesses travelled in the defendant’s privately operated plane which had vacant seats to accommodate them. Although it was acknowledged there would have been unoccupied seats had the witnesses not been assigned to the flight, the defendant was allowed to tax their travel fare on the basis of a bookkeeping entry which allocated the cost of the seats in accordance with a computation of the yearly cost to the defendant in the operation of its airplanes. The stark fact remains that if the seats had not been used by the two witnesses, the defendant’s annual expense for plane operation would have remained precisely the same. While the computation of the average cost per passenger may serve some statistical purpose of the defendant, it affords no justification for charging this theoretical figure to the plaintiff. At the second trial the defendant did not use its own plane but transported all three witnesses by commercial air line.

The basic issue remains—whether under all the circumstances it was necessary and reasonable to bring the witnesses from Saudi Arabia and other distant points to testify at the trials. Concededly, it is preferable to have “live witnesses” appear before the trier of the fact than to offer their testimony by way of deposition or interrogatories;10

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Bluebook (online)
31 F.R.D. 191, 6 Fed. R. Serv. 2d 1008, 1962 U.S. Dist. LEXIS 5931, Counsel Stack Legal Research, https://law.counselstack.com/opinion/farmer-v-arabian-american-oil-co-nysd-1962.