Ronald A. Baker And Joyce Baker, Apps. v. Fireman's Fund Ins. Co., Res.

428 P.3d 155

Opinion

IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON

RONALD A. BAKER, and JOYCE ) No. 76218-4-1 BAKER, husband and wife, ) ) Appellants/Cross-Respondents, ) ) DIVISION ONE v. ) ) FIREMAN'S FUND INSURANCE ) COMPANY; AMERICAN INSURANCE ) ORDER WITHDRAWING COMPANY, a member of the ) OPINION AND SUBSTITUTING FIREMAN'S FUND INSURANCE ) OPINION COMPANIES; NORTH PACIFIC ) INSURANCE COMPANY; ) ONEBEACON INSURANCE ) COMPANY; RUBATINO REFUSE ) REMOVAL INC., a Washington ) corporation; BRUNSWICK ) CORPORATION, owner of ) BRUNSWICK FAMILY BOAT CO., INC.,) manufacturer of Bayliner boats; and ) SNOHOMISH COUNTY, a political ) subdivision of the State of Washington, ) ) - Respondents/Cross-Appellants. ) )

The court has determined that the opinion filed on September 17, 2018,

shall be withdrawn and a substitute published opinion be filed. Now, therefore, it is

hereby

ORDERED that the opinion filed on September 17, 2018, is withdrawn and a

substitute published opinion shall be filed.

DATED this 15A- day of OCA1919(4 ( , 2018 1'63 C: ) GS TAP VA t & I

r" -Ft • fq 0Yn 9 4 4,7__ 15.-Or CP -37-rnn cfsrvit:, 1PP •

Citt) ci1,74- IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON

RONALD A. BAKER, and JOYCE ) No. 76218-4-I c) r• (Pc: , BAKER, husband and wife, ) c=1. ) c-, rnc) Appellants/Cross-Respondents, ) cp-n -n ) DIVISION ONE rri V. ) 72. ornc t— FIREMAN'S FUND INSURANCE ) COMPANY; AMERICAN INSURANCE ) cs: COMPANY, a member of the ) FIREMAN'S FUND INSURANCE ) COMPANIES; NORTH PACIFIC ) INSURANCE COMPANY; ) ONEBEACON INSURANCE ) COMPANY; RUBATINO REFUSE ) REMOVAL INC., a Washington ) corporation; BRUNSWICK ) CORPORATION, owner of ) BRUNSWICK FAMILY BOAT CO., INC.,) manufacturer of Bayliner boats; and ) SNOHOMISH COUNTY, a political ) subdivision of the State of Washington, ) PUBLISHED OPINION ) Respondents/Cross-Appellants. ) FILED: October 15, 2018 )

MANN,A.C.J.— Ronald and Joyce Baker filed suit against their insurance

companies, Fireman's Fund Insurance Company and American Insurance Company

(collectively Fireman's Fund), for breaching their duty to defend. The litigation ended in No. 76218-4-1/2

a settlement preserving the Bakers' claim for attorney fees for resolution by the trial

court. Using the lodestar method, and a 1.3 multiplier, the trial court awarded the

Bakers $1,209,757.25 for attorney fees and costs. The Bakers appeal and argue that

the trial court erred in (1)failing to make them whole under Olympic Steamship Co., v.

Centennial Ins. Co.,117 Wn.2d 37, 811 P.2d 673(1991),(2) exCluding some of their

claimed fees, and (3) applying only a 1.3 multiplier to the lodestar. Fireman's Fund

cross appeals.1 Because the trial court acted well within its discretion, we affirm.

I

The Bakers owned and operated the Sisco Woodwaste Landfill (landfill) in

Snohomish County. The Bakers opened the landfill in 1978 and operated it for six years

until 1984. The Bakers purchased insurance policies for the landfill from Fireman's

Fund covering the years between 1978 and 1986. The Bakers also purchased a three

year policy from North Pacific Insurance Company, the predecessor to OneBeacon

Insurance Company, in January 1986. OneBeacon cancelled this policy after only a

year.

The landfill received waste from a number of generators, including Snohomish

County and incinerator ash from a Boeing waste-to-energy facility. After the ash was

found to contain hazardous materials, the ash deliveries were stopped. In 1983, the

Washington Department of Ecology (Ecology)found that leachate had escaped from the

landfill. A year later, in 1984, the Snohomish Health District(SHD)suspended the

Bakers' operating permit and ordered the Bakers to stop operating the landfill.

I Respondent/Cross-Appellants Fireman's Fund filed a motion to Strike Appellant/Cross- Respondent's Reply Brief. The motion is denied. -2- No. 76218-4-1/3

The landfill continued to be problematic after its closure. In August 2000, the

SHD directed the Bakers to respond to the leachate problem and obtain a permit to

perform closure activities in accordance with the SHD sanitary code.

In October 2000, the Bakers contacted Fireman's Fund about insurance

coverage. Fireman's Fund responded and informed the Bakers that it had concluded

that some or all of the claims alleged may not be covered and "specifically reserve[d]

the right to assert any and all defenses to coverage." The letter informed the Bakers

that Fireman's Fund reserved the right to file a declaratory judgment action to determine

coverage and that it would seek reimbursement for all monies paid toward the defense

or representation if it was determined there was no coverage.

In May 2001, the SHD sued the Bakers alleging permit violations, violations of a

SHD order, and nuisance. The Bakers appeared pro se and did not retain counsel. A

default judgment was ultimately issued against the Bakers. The landfill was

subsequently identified on Ecology's hazardous sites list and ranked a "2" out of a scale

of 1 to 5 with 1 representing the highest level of concern.

In November 2005, Fireman's Fund changed its coverage determination and

agreed to participate in the "defense of claims asserted against[the Bakers] by the SHD

and DOE that the Landfill and adjacent property and/or associated groundwater are

contaminated." It agreed to provide this defense subject to a full reservation of its

rights. It also appointed Marten Law Group (Marten Law)to represent the Bakers.

In October 2006, Marten Law identified 12 waste generators and transporters

who, by disposing potentially hazardous waste at the landfill, may have been potentially

liable parties (PLPs). Marten Law identified several options for dealing with cleanup

-3- No. 76218-4-1/4

liability at the landfill including seeking contribution from the PLPs and settlement with

the Ecology and Snohomish County.

In May 2007, the Bakers retained Hackett Beecher & Hart(HBH)on a

contingency fee agreement. The contingency agreement required the Bakers to pay

HBH one-third of the "gross amount recovered." With HBH as their attorney, the Bakers

then filed suit against Fireman's Fund and one of the PLP's identified by Marten Law.

The Bakers alleged that Fireman's Fund (1) breached its contractual duties to

investigate, defend, and indemnify them for costs incurred under the Model Toxic

Control Act(MTCA)2,(2) acted negligently and in bad faith, and (3) engaged in unfair

claims settlement practices in violation of the Consumer Protection Act(CPA).3 In May

2008, Fireman's Fund agreed to the Bakers' request to fund legal action against the

PLPs using Marten Law.

In April 2009, after Fireman's Fund unsuccessfully moved to sever the Bakers'

insurance-related claims from claims against PLPs, the parties stipulated, at the trial

court's direction, that "actions or positions taken by [Fireman's Fund] in [its] own

defense as parties to this suit. . . shall not be used or referred to in any way in

connection with any of the causes of action [the Bakers] have asserted or will assert

against [Fireman's Fund]."

In December 2009, in an effort to avoid foreclosure, the Bakers asked Fireman's

Fund if it would pay the Bakers' outstanding property tax bill of $70,286.14. Fireman's

Fund agreed and promptly paid the bill.

2 Chapter 70.105D RCW. 3 Chapter 19.86 RCW.

-4- No. 76218-4-1/5

From August 2010 until the summer of 2013, the Bakers' case against Fireman's

Fund was pending but inactive. This was because of the lengthy time periods

necessary to gather environmental data, present findings to Ecology, await the

Ecology's opinion, and then gather more data.

In July 2014, the court continued trial to March 2015 and ordered the parties to

mediate within 30 days of receiving Ecology's opinion on environmental remediation.

The parties received Ecology's opinion letter in December 2014, and began mediation

in January 2015.

Over the course of three mediation sessions, the parties resolved their disputes.

The first settlement agreement resolved the disputes over the landfill remediation

between the Bakers, Snohomish County, and two PLPs. Under this settlement,

Snohomish County agreed to take ownership and full responsibility for remediating the

landfill and closing it in return for payments on behalf of the Bakers and the two PLPs.

The Bakers and Fireman's Fund then resolved their dispute by entering a

settlement agreement, buy back of insurance policies, and release of all claims. In

exchange for monetary payments, the Bakers agreed to release all claims against

Fireman's Fund. The settlement, however, left open the Bakers' ability to separately

pursue attorney fees through the trial court:

Nothing in this Agreement shall foreclose the Bakers' ability to pursue attorney fees from Fireman's Fund based on Olympic Steamship, alleged Consumer Protection Act(CPA) violations, and/or bad faith, which attorney fee claim will be resolved on motion practice in the Lawsuit. The Bakers will file their motion for their claim for fees within 10 days of this fully executed Agreement, or as soon as practicable thereafter given the court's and the parties' availability for hearing the motion. The parties agree to abide by the briefing schedule set forth in CR 56(c), i.e., the Bakers' motion shall be filed not later than 28 calendar days before the

-5- No. 76218-4-1/6

hearing, any opposition shall be filed not later than 11 calendar days before the hearing, and any rebuttal shall be filed not later than five (5) calendar days before the hearing. For purposes of the Bakers' motion for attorney fees, CPA violations need not be proven, although Fireman's Fund makes no concessions that a specific fee entry relates to the CPA claim.

Consistent with the settlement, on June 10, 2016, the Bakers petitioned the trial

court for an award of their attorney fees and costs. The petitions sought fees pursuant

to either Olympic Steamship, the CPA, or under equity due to bad faith. The Bakers

asked the court to apply the lodestar method as the proper measurement of reasonable

attorney fees. In support, the Bakers offered declarations from several local attorneys

in support of a reasonable hourly rate, along with time records to support the number of

hours billed. Under the lodestar method, the Bakers sought $1,147,435 in attorney

fees. The Bakers asked the trial court to apply a "liberal multiplier" of 2.5 times the base

amount in recognition of the unusual, difficult and risky nature of the litigation. The

Bakers requested a total of $2,875,177 in attorney fees and costs. The trial court

entered findings and conclusions concurring that the Baker's requested hourly rates

were reasonable but reducing some of the hours billed for matters it deemed either

unnecessary or inappropriate. The court determined that the proper lodestar amount

was $930,582.50. The court then used a 1.3 times multiplier concluding that "it is

appropriate to take into account the exceptionally long pendency of this case during

which time HBH received no payment of fees or reimbursement for costs, the

exceptionally favorable result which they obtained on behalf of their clients, and the risk

(albeit not large) that no recovery might be obtained." The court awarded the Bakers'

$1,209,757.25 for reasonable attorney fees and $26,634.06 in reasonable costs.

-6- No. 76218-4-1/7

After the trial court denied the Bakers' motion for reconsideration, the Bakers

appealed. Fireman's Fund cross appealed.

II

There are two relevant inquires in determining an award of attorney fees: first,

whether the prevailing party is entitled to legal fees, and second, whether the award of

attorney fees is reasonable. Public Util. Dist. 1 v. International Ins. Co., 124 Wn.2d 789,

814, 881 P.2d 1020 (1994). Whether a party is legally entitled to recover attorney fees

is a question of law that we review de novo. King County v. Vinci Constr. Grands

Projets/Parsons RCl/Frontier-Kemper JV, 188 Wn.2d 618, 625, 398 P.3d 1093(2017).

Whether the amount of fees awarded was reasonable is reviewed for an abuse of

discretion. "In order to reverse an attorney fee award, an appellate court must find the

trial court manifestly abused its discretion." Pham v. Seattle City Light, 159 Wn.2d 527,

538, 151 P.3d 976 (2007). "That is, the trial court must have exercised its discretion on

untenable grounds or for untenable reasons." Pham, 159 Wn.2d at 538.

We first examine whether the Bakers were legally entitled to recover attorney

fees. In general,"Washington follows the American rule in awarding attorney fees."

Dayton v. Farmers Ins. Group, 124 Wn.2d 277, 280, 876 P.2d 896 (1994). Under the

American rule, a court may award attorney fees only if that award is authorized by

contract, statute, or a recognized ground in equity. Vinci Constr., 188 Wn.2d at 625.

One such recognized equitable ground is the rule announced in Olympic Steamship.

Under Olympic Steamship, "[a]n insured who is compelled to assume the burden of

legal action to obtain the benefit of its insurance contract is entitled to attorney fees."

117 Wn.2d at 54.

-7- No. 76218-4-1/8

The parties do not dispute that the Bakers were the prevailing party and thus

entitled to reasonable attorney fees under Olympic Steamship.4 Consequently, our

analysis focuses on whether the trial court abused its discretion in determining the

Bakers' reasonable attorney fees.

III

The Bakers argue first that the trial court abused its discretion in failing to

consider the "make whole" purpose of an award of attorney fees under Olympic

Steamship. In essence, the Bakers assert that because the fee agreement with their

attorneys would have obligated them to pay HBH one-third of the gross recovery from

Fireman's Fund, any award of fees less than that amount does not make them whole.

We disagree.

At the outset, we agree with the Bakers that the equitable purpose supporting an

award of attorney fees under Olympic Steamship requires that the insured be made

whole. As our Supreme Court has explained:"when an insurer unsuccessfully contests

coverage, it has placed its interests above the insured. Our decision in Olympic

Steamship remedies this inequity by requiring that the insured be made whole."

McGreevy v. Oregon Mutual Ins. Co., 128 Wn.2d 26, 39-40, 904 P.2d 731 (1995);

Panorama Village Condominium Owners Ass'n v. Allstate Ins. Co., 144 Wn.2d 130, 144,

26 P.3d 910 (2001). We disagree, however, with the Bakers' assertion that because the

trial court failed to award attorney fees at a level commiserate with the contingency fee

4 While Fireman's Fund argues in its briefing before this court that the Bakers were not the prevailing party under the settlement, during oral argument counsel conceded that the Bakers were the prevailing party. -8- No. 76218-4-1/9

agreement between the Bakers and HBH, it failed to make them whole and therefore

abused its discretion.

The starting point, and indeed, the "primary consideration," in determining an

appropriate award of attorney fees is reasonableness. Allard v. First Interstate Bank of

Washington, N.A., 112 Wn.2d 145, 153, 768 P.2d 998(1989). Thus, in order to assure

that an insured is made whole under Olympic Steamship, the attorney fee award must

include all reasonable attorney fees, including all expenses necessary to establish

coverage. Panorama Village, 144 Wn.2d at 144.

One established method of determining a reasonable attorney fee award is the

lodestar method. Mahler v. Szucs, 135 Wn.2d 398, 433, 957 P.2d 632(1998). Under

this method, the trial court first examines the attorneys' billing records and determines

the number of hours that were reasonably expended in pursuing the litigation. Mahler,

135 Wn.2d at 433-34. The total number of hours reasonably expended is then

multiplied by the reasonable hourly rate of compensation resulting in the lodestar fee.

Mahler, 135 Wn.2d at 434. After the lodestar has been calculated, the court may then

consider the necessity of adjusting the rate after considering factors not already taken

into consideration including the contingent nature of the work. Mahler, 135 Wn.2d at

434; Scott Fetzer Co. v. Weeks, 122 Wn.2d 141, 150, 859 P.2d 1210(1993).

No Washington court has held the lodestar method is the exclusive method to

determine reasonable attorney fees.5 By the same token, no Washington court has

5 For example, the Bakers' could have presented the trial court with their underlying contingency fee agreement and asked the court to determine if the agreement was reasonable under RPC 1.5(a)(the RPA governing reasonableness of attorney fees), and if so, award the Bakers the agreed one-third of the gross amount recovered from Fireman's Fund for fees. See Allard, 112 Wn.2d at 152-154 (approving

-9- No. 76218-4-1/10

held that a trial court abuses its discretion by using the lodestar method in order to

determine reasonable attorney fees. In this case, the Bakers agreed that the lodestar

method was appropriate:

the proper measurement of a reasonable attorney fee is the same: the Court determines a base award by using the lodestar calculation: the reasonable number of hours spent representing the plaintiff is multiplied by a reasonable hourly rate.. . . The Court then determines whether that base award should be subject to a multiplier, primarily on the basis of the contingent nature of the fee and the risk of no recovery at the inception of the case.

The trial court did not abuse its discretion by accepting the Bakers' argument that the

lodestar method was proper for determining the Bakers' reasonable attorney fee award

under Olympic Steamship.

IV

The Bakers next claim that the trial court abused its discretion by excluding fees

for work that were not necessary to pursue the claims against Fireman's Fund. We

disagree.

Under the lodestar method,"the party seeking fees bears the burden of proving

the reasonableness of the fees." Mahler, 135 Wn.2d at 433-34. In determining the

base lodestar, the trial court "must limit the lodestar to hours reasonably expended, and

should therefore discount hours spent on unsuccessful claims, duplicated effort, or

otherwise unproductive time." Scott Fetzer, 122 Wn.2d at 151 (quoting Bowers v.

Transamerica Title Ins. Co., 100 Wn.2d 581, 597,675 P.2d 193(1983)). "The hours

reasonably expended must be spent on claims having a 'common core of facts and

using contingency fee agreement to determine reasonable fees). But this is not what the Bakers did. The Bakers elected to follow the lodestar method. -10- No. 76218-4-1/11

related legal theories." Pham, 159 Wn.2d at 538 (quoting Martinez v. City of Tacoma,

81 Wn. App. 228, 242-43, 914 P.2d 86 (1996)). "Courts must take an active role in

assessing the reasonableness of fee awards, rather than treating cost decisions as a

litigation afterthought." Mahler, 135 Wn.2d at 434. The trial court is required to enter

findings of fact and conclusions of law. Mahler, 135 Wn.2d at 435.

The Bakers claim that the trial court abused its discretion in excluding or reducing

hours billed for four different matters. We address each in turn.

Fees Related to Tax Foreclosure

The Bakers' attorney time records show that they spent over 226 hours

assessing the Bakers' outstanding tax bill and possible foreclosure on their property

over the course of approximately 18 months. When the Bakers notified Fireman's Fund

of the tax issue in December 2009, Fireman's Fund agreed to pay the long overdue bill

within a week. The trial court excluded 211.7 hours spent on the Bakers' outstanding

property tax bill and related foreclosure:

Claims related to the property tax foreclosure proceedings against the landfill property, for 211.7 hours, totaling $61,280.00. While HBH obtained a favorable result for [the Bakers] by getting Fireman's Fund to pay the outstanding tax bill, this was not an item covered by the applicable insurance policies and should not be included in fees awarded against Fireman's Fund. Arguably it does not fall within the contingent fee agreement HBH had with the Bakers at all.

The Bakers failed to carry their burden to demonstrate these fees were

appropriate. Because Fireman's Fund promptly paid the tax bill after being notified, and

the property tax bill was at best tangential to the Bakers' claims against Fireman's Fund,

the trial court did not abuse its discretion in denying the 211.7 hours spent on the

foreclosure issue.

-11- No. 76218-4-1/12

Fees Related to PRP Claims

In May 2008, at the Bakers' request, Fireman's Fund agreed to pay Marten Law

to prosecute claims against the PRPs. There is no dispute that Fireman's Fund paid

Marten Law in full. The Bakers sought recovery for additional attorney fees by HBH for

litigation against the PRPs. Fireman's Fund did not oppose some of the claimed fees

including time spent attending depositions of witnesses related to the PRP claims, time

spent reviewing discovery, or time spent for updates from Marten Law. Fireman's fund

did, however, object to time spent by HBH for preparing for depositions, strategy and

assessment of claims, hours spent reviewing documents that consultants prepared for

Marten Law, and other duplicative tasks. The trial court agreed with Fireman's Fund

that some of these hours should be excluded:

Fees related to [PLPs] which were pursued by[MLG]on behalf of[the Bakers], for 139.4 hours, in the amount of $58,292.50. [The Bakers] have not established that it was necessary to prevail on their insurance claims to incur these attorney hours when [MLG] had been retained by Fireman's Fund to represent them with regard to issues related to the landfill clean- up, including seeking contribution by third parties.

The Bakers argue that this time should have been included because the work

related to the Bakers' insurance claims against Fireman's Fund. They point to specific

entries where the trial court excluded time that was spent on issues relevant to both

sets of claims, the Bakers' insurance claims and the PLP litigation led by MLG. The

Bakers failed to carry their burden to demonstrate these fees were non-duplicative or

necessary for the Bakers' claims against Fireman's Fund.

The trial court did not abuse its discretion in excluding 139.4 hours for duplicative

work related to the PRP claims.

-12- No. 76218-4-1/13

• Fees incurred litigating against OneBeacon

The trial court excluded time spent litigating claims against OneBeacon, another

insurer that had issued a policy to the Bakers from 1986 to 1987:

Fees related to claims against One Beacon, for 142.6 hours, totaling $65,540.00. Plaintiffs have not established that it was necessary for them to pursue these claims when the contribution claims were being handled by[MLG]on behalf of[the Bakers].

The Bakers argue that excluding time litigating with OneBeacon was error

because of the common-fund doctrine: Fireman's Fund is required to pay for the Bakers'

fees incurred recovering a contribution from OneBeacon because that contribution

ultimately lowered the amount that Fireman's Fund had to pay to Snohomish County.

(OneBeacon contributed $300,000 to the County.) The Bakers claim that the trial

court's factual mistake about OneBeacon's status—it was an insurer, but the court

appeared to treat OneBeacon as if it were a PLP—compounded the court's error.

Here, excluding time billed on OneBeacon-related work was reasonable. First,

the common-fund doctrine does not apply because in order to create the common fund,

the insured must recover from the "at-fault party" and OneBeacon is not the at-fault

party. Matsyuk v. State Farm Fire & Cas. Co., 173 Wn.2d 643, 650, 272 P.3d 802

(2012); see Mahler, 125 Wn.2d at 428 (discussing doctrine in context of insured

recovering from tortfeasors, not another insurer).

Second, Fireman's Fund likely secured its right to contribution from OneBeacon

at the time the Bakers tendered their claim to OneBeacon. This right was created by

the continuous-trigger doctrine: when an insured sustains continuous damages all

insurers providing coverage for any portion of the total time period of the continuing

-13- No. 76218-4-1/14

damage are jointly and severally liable for the entire amount of damage. Am. Nat'l Fire

Ins. Co. v. B & L Trucking & Const. Co., Inc., 134 Wn.2d 413, 424, 951 P.2d 250 (1998).

Here, since the landfill's environmental damage continued overtime, under the

continuous-trigger doctrine both insurers would have been jointly and severally liable for

the entire amount of the damage at the time the Bakers tendered a claim to them.

Finally, the Bakers' argument that the trial court's factual mistake as to

OneBeacon's identity somehow led to it misapplying the common-fund doctrine is

unpersuasive. OneBeacon's identity is irrelevant to Fireman's Fund's liability under

insurance policies.

The trial court did not abuse its discretion in excluding 142.6 hours for litigating

claims against OneBeacon.

Fees for acting as the Bakers'personal counsel

The trial court excluded time that HBH spent as the Bakers' personal counsel:

Fees related to acting as personal counsel for [the Bakers] with regard to tax consequences of the settlement to them and other issues, for 46.7 hours, totaling $21,000.00. These issues were undoubtedly of importance to [the Bakers] but were not necessary to establishing Fireman's Fund[ls obligations under the insurance contracts, and appear to have been incurred after settlement was reached in March 2015.

The Bakers argue that the lodestar should include time their counsel advised

them on the settlement's tax effects for two reasons. First, Olympic Steamship and the

CPA allow a prevailing party to recover all of its fees, not just fees related to liability

issues. Second, the CR 2A Agreement did not settle the case because payment from

Fireman's Fund was contingent on the rest of the parties settling with the Bakers.

-14- No. 76218-4-1/15

The trial court recognized that the issues regarding the tax consequences of the

settlement were important to the Bakers but irrelevant to establishing Fireman's Fund's

liability to the Bakers. Further, whether the Bakers would have reneged on the CR 2A

Agreement had HBH not advised them is irrelevant: the record shows that they settled

their claims against Fireman's Fund and that the parties in fact agreed to a settlement in

principle.

The trial court did not abuse its discretion in excluding 46.7 hours for personal

counsel.

V

The Bakers finally claim that the trial court abused its discretion by applying a 1.3

multiplier instead of their requested 2.5 multiplier. Again, we disagree.

After the court has calculated the lodestar, it may adjust it by applying a

multiplier: "the lodestar fee. . . may, in rare instances, be adjusted upward or

downward in the trial court's discretion." Mahler, 135 Wn.2d at 434. "Adjustments to

the lodestar product are reserved for 'rare' occasions." Miller v. Kenny, 180 Wn. App.

772, 825, 325 P.3d 278 (2014). The lodestar is "presumed to adequately compensate

an attorney." Miller, 180 Wn. App. at 825.

Courts can adjust the lodestar based on factors not already taken into

consideration including, the benefit to the client and the contingency or uncertainty in

collecting the fee. Scott Fetzer, 122 Wn.2d at 150.

The trial court agreed with the Bakers that the reasonable hourly rate did not

reflect the quality of the work performed. The court disagreed, however, that the

-15- No. 76218-4-1/16

Baker's requested 2.5 times multiplier was appropriate and instead applied a 1.3

multiplier. The court explained:

while this case was complicated by long delays in part due to waiting on decisions from the Washington State Department of Ecology, the number of parties, and the combination of claims, it did not present complex or novel issue with regard to the insurance coverage issues. Furthermore, the probability of ultimately prevailing on the coverage issues was high because of Fireman's Fund's lack of responsiveness to Plaintiffs' inquiries from 2001 to 2005 and early assertions that there was no coverage under the policies. There is no evidence that HBH was required to turn down other profitable work because of this case.

After considering the entire record, the court is not persuaded that Plaintiffs have established that a 2.5 multiplier is appropriate. However, the court concludes that it is appropriate to take into account the exceptionally long pendency of this case during which time HBH received no payment of fees or reimbursement for costs, the exceptionally favorable result which they obtained on behalf of their clients, and the risk (albeit not large) that no recovery might be obtained. For these reasons, the court concludes a multiplier of 1.3 is supported by the record. This results in an attorney fee award of $1,209,757.25.

The court awarded a multiplier because of "the risk (albeit not large) that no

recovery might be obtained," the length of time it took to resolve, and that HBH

recovered no fees or costs for up to nine years. This are proper reasons supporting a

multiplier. Scott Fetzer, 122 Wn.2d at 150. The court's decision also took into account

the contingent nature of the Bakers'fee agreement. The court's decision is supported

by its finding and substantial evidence. The trial court did not abuse its discretion in

awarding a 1.3 times multiplier to the lodestar fee.

VI

Fireman's Fund cross appeals and challenges (1) the trial court's failure to

deduct hours for additional unsuccessful, duplicated, and unproductive work, and (2)the

hourly rates approved for the Bakers' attorneys. We address each in turn.

-16- No. 76218-4-1/17

Additional Exclusions

Fireman's Fund claims first that the trial court erred in approving the following

additional fees claimed by the Bakers:(1)43 hours spent on a motion for summary

judgment that was never filed;(2) time spent consulting with the Bakers regarding

settlements that had already been agreed to;(3) time spent submitting claims for other

defense expenses after the parties had settled; and (4) communications and meetings

with the assessor's office and environmental consultants. We disagree.

The trial court rejected Fireman's Fund's argument that this work should be

excluded:

Fireman's Fund has asserted that other fees should also be deducted. These include fees they designate as administrative, correcting discovery responses, duplicative/excess time, unnecessary/unsuccessful, vague[,] and not apparently related to the claims against Fireman's Fund. The court does not agree. For example, counsel is required to correct and supplement discovery responses. The charge for this is minimal, and the need is not out of line with what occurs in many cases. The time spent on researching a motion for summary judgment is not unreasonable and cannot be said to be unnecessary. The benefits of such research would still be applicable for trial and mediation of claims.

The record before us demonstrates that the court considered the entire record

and found that this work by the Bakers' attorneys was reasonable and necessary.

While Fireman's Fund disagrees with the court's decision, it fails to show that the court's

decision was manifestly unreasonable. The trial court did not abuse its discretion in

excluding hours from the lodestar.

Hourly Rates

Fireman's Fund claims that it was error to calculate the lodestar without evidence

of HBH's actual hourly rates. We disagree.

-17- No. 76218-4-1/18

When attorneys have an established rate for billing clients, that rate is likely a

reasonable rate. McGreevy, 90 Wn. App. at 283 (citing Bowers, 100 Wn.2d at 597).

The usual rate is not, however, conclusively a reasonable fee and other factors may

necessitate an adjustment. The court may also consider the level of skill, time limits

imposed by the litigation, the attorney's reputation, and the undesirability of the case,

and on local rates charged by attorneys with similar skills and experience. McGreevy,

90 Wn. App. at 293; Miller, 180 Wn. App. at 820-21.

Here, the Bakers did not offer evidence of actual hourly rates charged by HBH.

As the trial court explained, the fee agreement between the Bakers and HBH was

contingent and consequently, HBH was not charging an hourly rate for its work for the

Bakers. Instead, the trial court based its determination of relevant rates on declarations

from several local attorneys that do similar work in the relevant legal community. The

trial court concluded: "Based on the evidence presented, the hourly rates set forth

above are reasonable for the type of legal work performed in this case in the Puget

Sound legal community for attorneys and paralegals of similar skill, experience, and

reputation." The trial court's determination of reasonable hourly rates was supported by

substantial evidence and was not an abuse of discretion.

-18- No. 76218-4-1/19

We affirm the trial court's fee award.6

77f ct.t4,t,,(lc

WE CONCUR:

6 The Bakers request attorney fees on appeal "pursuant to Olympic Steamship and the[CPA]and RAP 18.1." We decline to award the Bakers fees because they do not prevail.

-19-