Gautam v. Hicks

310 P.3d 862, 177 Wash. App. 112
CourtCourt of Appeals of Washington
DecidedOctober 7, 2013
DocketNo. 69406-5-I
StatusPublished
Cited by2 cases

This text of 310 P.3d 862 (Gautam v. Hicks) is published on Counsel Stack Legal Research, covering Court of Appeals of Washington primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Gautam v. Hicks, 310 P.3d 862, 177 Wash. App. 112 (Wash. Ct. App. 2013).

Opinion

Becker, J.

¶1 — A party who appeals the award in a mandatory arbitration and fails to improve his position on trial de novo must pay the attorney fees incurred by the nonappealing party. An offer of compromise by the nonappealing party will replace the amount of the arbitrator’s award for the purpose of determining whether the appealing party has improved his position. Here, the plaintiffs — a husband with a claim for personal injuries and a wife with a claim for loss of consortium — offered to settle both claims for $32,000, a total amount not delineated by claim. The jury awarded $30,000 to the husband and nothing to the wife. Because the defendant improved his position relative to the offer, he should not have been [114]*114ordered to pay the husband’s attorney fees. The award is reversed.

¶2 Sunny Gautam and Donald Hicks were involved in an automobile accident on August 25, 2010. Sunny Gautam and his wife, Suman Gautam, sued Hicks and his marital community. Sunny Gautam claimed damages for personal injury. Suman Gautam’s claim was for loss of consortium.

¶3 The matter was transferred to mandatory arbitration. The arbitrator addressed each claim separately. For Sunny’s personal injuries, the arbitrator awarded $28,136. For Suman’s loss of consortium claim, the arbitrator awarded $3,000. In total, the arbitrator awarded $31,136. Hicks filed a timely request for trial de novo.

¶4 “Up to thirty days prior to the actual date of a trial de novo, a nonappealing party may serve upon the appealing party a written offer of compromise.” RCW 7.06.050(l)(a). The Gautams made an offer of compromise pursuant to RCW 7.06.050 to settle all claims for $32,000:

YOU AND EACH OF YOU ARE HEREBY NOTIFIED that pursuant to RCW 7.06.050, Plaintiff SUNNY GAUTAM and SUMAN GAUTAM hereby make an Offer of Compromise in the sum of Thirty Two Thousand Dollars ($32,000.00) for full and final settlement of all claims in this action. This amount is inclusive of costs and statutory attorney fees.

Hicks rejected the offer, and the case proceeded to trial de novo.

¶5 The jury found Hicks liable for the accident and awarded Sunny $30,000 in damages. The jury awarded nothing for Suman’s loss of consortium claim. In total, the jury awarded $30,000. The jury’s award to Sunny ($30,000) was greater than the arbitrator’s award to Sunny ($28,136). However, the jury’s total award for both claims ($30,000) was less than what the Gautams offered to accept to compromise both claims ($32,000).

¶6 A trial court must assess attorney fees and costs against a party who demands trial de novo and then fails to improve his position:

[115]*115The superior court shall assess costs and reasonable attorneys’ fees against a party who appeals the award and fails to improve his or her position on the trial de novo.

RCW 7.06.060(1); MAR 7.3.

¶7 If the nonappealing party makes an offer of compromise that is not accepted, the amount of the offer of compromise replaces the arbitration award as the measure of improvement:

In any case in which an offer of compromise is not accepted by the appealing party within ten calendar days after service thereof, for purposes of MAR 7.3, the amount of the offer of compromise shall replace the amount of the arbitrator’s award for determining whether the party appealing the arbitrator’s award has failed to improve that party’s position on the trial de novo.

RCW 7.06.050(l)(b) (emphasis added).

¶8 The Gautams claimed that the court was obliged to assess fees and costs against Hicks because the jury verdict of $30,000 did not improve Hicks’ position with respect to Sunny. They requested that fees and costs be assessed against Hicks in the total amount of $85,727 (lodestar amount of $42,636 and a multiplier of 2) for hours spent on Sunny’s claim. They requested no fees and costs related to Suman’s claim.

¶9 The trial court agreed that Sunny was entitled to an award of attorney fees and costs against Hicks. The total amount awarded was $49,947.40, calculated with a multiplier of 1.5.

¶10 Hicks appeals. He contends the trial court erroneously concluded that he failed to improve his position.

¶11 Our review is de novo because the result turns on interpretation of the mandatory arbitration statutes. Basin Paving Co. v. Contractors Bonding & Ins. Co., 123 Wn. App. 410, 414, 98 P.3d 109 (2004).

¶12 The trial court concluded that “plaintiff is not entitled to fees and costs based on its offer of compromise. [116]*116It was not specific as to claims or costs.” Instead of looking at the offer of compromise, the court compared the jury award for Sunny’s claim ($30,000) to the arbitrator’s award for his claim ($28,136):

By failing to return a jury verdict in its favor greater than Plaintiff’s Arbitration Award and — offer—ef—compromise ($28,146.10), Defendant failed to improve its position on Sunny Gautam’s claim only. Pursuant to MAR 7.3 and RCW 7.06.060, Plaintiff is therefore entitled to his reasonable attorney’s fees and costs on Sunny Gautam’s claim only Defendant prevailed on Suman Gautam’s claim. She is not entitled to fees and costs.
... Plaintiff is not entitled to fees and costs based on its offer of compromise. It was not specific as to claims or costs.

Conclusion of Law 1, Clerk’s Papers at 152 (strikethrough by trial judge).

¶13 This was error. The statute requires the court to look to the offer of compromise to determine whether the appealing party has failed to improve his or her position on trial de novo. RCW 7.06.050(l)(b), .060(1). The Gautams do not cite authority, and we have found none, that permits a court to disregard an offer of compromise on the basis that it is not “specific as to claims or costs.” The Gautams could have made an offer of compromise that specifically delineated one amount for Sunny’s personal injury claim and another for Suman’s loss of consortium claim, but they did not do so. They offered to settle “all claims” for the single sum of $32,000.

¶14 To justify the trial court’s use of the arbitrator’s award as a basis of comparison, the Gautams describe their offer of compromise as if it had been broken down between Sunny and Suman:

Plaintiff attempted to reduce the Arbitration Award to an Offer of Compromise to provide Defendant with another opportunity to resolve this matter without a trial, though there was a difference of $11.10 between the two. The Offer of Compromise breakdown is:

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Berryman v. Metcalf
312 P.3d 745 (Court of Appeals of Washington, 2013)

Cite This Page — Counsel Stack

Bluebook (online)
310 P.3d 862, 177 Wash. App. 112, Counsel Stack Legal Research, https://law.counselstack.com/opinion/gautam-v-hicks-washctapp-2013.