Maday v. Elview-Stewart Systems Co.

324 N.W.2d 467, 1982 Iowa Sup. LEXIS 1472
CourtSupreme Court of Iowa
DecidedSeptember 29, 1982
Docket67056
StatusPublished
Cited by24 cases

This text of 324 N.W.2d 467 (Maday v. Elview-Stewart Systems Co.) is published on Counsel Stack Legal Research, covering Supreme Court of Iowa primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Maday v. Elview-Stewart Systems Co., 324 N.W.2d 467, 1982 Iowa Sup. LEXIS 1472 (iowa 1982).

Opinion

*468 SCHULTZ, Justice.

In this appeal plaintiff seeks to establish his right to attorney fees incurred in his successful suit against a former employer for unpaid wages. The trial court refused his request; we hold, however, that plaintiff was entitled to reasonable attorney fees pursuant to Iowa Code § 91A.8 (1981). We reverse and remand for a determination of such fees.

Thomas 0. Maday was employed by El-view-Stewart Systems Co. (Elview) as a sales representative on a salary and commission agreement from February 1978 until he was discharged by Elview in September 1979. After the discharge Maday claimed that he was entitled to unpaid commissions while Elview argued that it had overpaid Maday and was entitled to a return of the overpayment.

Maday filed an action against Elview, and it filed a counterclaim. Although Ma-day’s petition was in three divisions, only portions of divisions I and III are relevant to this appeal. In division I, which was based on contract, Maday sought damages for $11,952 of unpaid commissions. Division III, as amended, was grounded on the Iowa Wage Payment Act which provides remedies for employees to secure payment of wages and expenses. Iowa Code ch. 91A (1981). The prayer for relief in division III sought recovery for the same unpaid commissions sought in division I “plus additional liquidated damages, court costs and attorney’s fees to be determined by the court pursuant to Iowa Code ch. 91A.”

The action came to trial and after Maday presented his evidence Elview moved for a directed verdict on division III. The court granted Elview’s motion. Following the presentation of all the evidence Maday’s claim in division I and Elview’s counterclaim were submitted to the jury. The jury returned a verdict for Maday in the sum of $2,710, an amount both parties concede represented earned but unpaid commissions owed to Maday. The jury denied both Ma-day’s other claims and Elview’s counterclaim.

Maday’s sole issue on this appeal concerns his claim for attorney fees grounded on section 91A.8. Maday argues that the trial court erred when it directed a verdict on division III thereby precluding consideration of the claim. He further contends the trial court erred in denying his posttrial motions which asked the court to fix attorney fees, requested a new trial, and demanded judgment notwithstanding the verdict.

Elview now concedes that the grounds it urged in its motion for a directed verdict on division III were invalid. In its oral motion for a directed verdict Elview urged that chapter 91A was enforceable only by the labor commissioner, and that Maday’s suit was not valid because Maday had not exhausted his administrative remedies prior to filing his cause of action. The court accepted Elview’s argument and sustained the motion. In his posttrial motions, Maday specifically called the trial court’s attention to section 91A.10(3) which allows an employee the option to bring a wage act claim in district court without the labor commissioner and outside the scope of the administrative procedure that is provided in chapter 91A. Elview admits that it misled the trial court concerning chapter 91 A.

Despite its concession, Elview claims that Maday still may not claim attorney fees under section 91A.8 because: (1) neither the statute nor the case law has established the necessary rules of the evidence and the procedure of establishing attorney fees, and there was no evidence of reasonable attorney fees produced and presented to either the jury or the court; and (2) the plaintiff did not preserve error.

I. Procedure for establishing attorney fees. We have not previously examined the portions of section 91A.8 that provide for the allowance of attorney fees. Section 91A.8 reads as follows:

When it has been shown that an employer has intentionally failed to pay an employee wages or reimburse expenses pursuant to section 91A.3, whether as the result of a wage dispute or otherwise, the employer shall be liable to the employee *469 for any wages or expenses that are so intentionally failed to be paid or reimbursed, plus liquidated damages, court costs and any attorney’s fees incurred in recovering the unpaid wages and determined to have been usual and necessary. In other instances the employer shall be liable only for unpaid wages or expenses, court costs and usual and necessary attorney’s fees incurred in recovering the unpaid wages or expenses.

Thus, if an employer is held liable to an employee for unpaid wages or expenses, the employer is also liable for the usual and necessary fees of the employee’s attorney. The employer bears this liability whether the failure to pay was intentional or otherwise. Elview correctly notes, however, that by its silence the statute raises additional questions: (1) When a jury is the trier of fact, should the judge or the jury determine the amount of the usual and necessary attorney fees? (2) What evidence is required and at what procedural point in the case should the evidence, if any is required, be introduced?

A. The court should determine attorney fees. Attorney fees are not ordinarily allowable in favor of a successful party unless authorized by statute or agreement. Addy v. Addy, 240 Iowa 255, 266, 36 N.W.2d 352, 359 (1949). They are not considered an element of damages nor are they taxable as costs at common law, unless specifically authorized by statute. Turner v. Zip Motors, Inc., 245 Iowa 1091, 1100, 65 N.W.2d 427, 431 (1954).

Section 91A.8 provides liability for attorney fees, but does not state explicitly whether they are to be determined as an element of damages by the fact-finder or taxed as costs by the trial court. Nonetheless, we interpret section 91A.8 to place the responsibility for determining the appropriate attorney fees upon the trial court. This rule is the better one and is in accord with the intent of the legislature.

Not all authorities agree that attorney fees allowed by statute are to be assessed by the court as costs. Indeed, some authorities recognize such fees as an element of damages. See 20 C.J.S. Cost § 218 (1940) (“It has been held that attorney fees even when allowable under statutory authority, may not be a part of the costs, as where the statute deals with them as a separate matter of recovery and does not specifically make them a part of the costs; but according to other authorities, they are to be awarded as part of the costs, and not separate and distinct therefrom.”). When considered as damages, the amount of fees is determined by a jury, if a party so requests. 25 C.J.S. Damages § 50(b) (1966) (expenses of litigation or attorney fees may be allowed as damages where statutory provision is made therefor and determination of attorney fees is a matter for the jury); Dyche Real Estate Fund v. Graves, 55 Ohio App.2d 153, 155, 380 N.E.2d 767

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Bluebook (online)
324 N.W.2d 467, 1982 Iowa Sup. LEXIS 1472, Counsel Stack Legal Research, https://law.counselstack.com/opinion/maday-v-elview-stewart-systems-co-iowa-1982.