Sandra Foster v. the Manhattan Group, LLC, D/B/A Foster Motor Company

2023 Ark. App. 560

• Court: Court of Appeals of Arkansas
• Decided: December 6, 2023
• Status: Published

Opinion

Cite as 2023 Ark. App. 560 ARKANSAS COURT OF APPEALS DIVISION II No. CV-22-292

Opinion Delivered December 6, 2023 SANDRA FOSTER APPELLANT APPEAL FROM THE JEFFERSON COUNTY CIRCUIT COURT [NOS. 35CV-21-332 & 35DR-20-1071] V. HONORABLE LEON N. JAMISON, THE MANHATTAN GROUP, LLC, JUDGE D/B/A FOSTER MOTOR COMPANY REVERSED APPELLEE

RITA W. GRUBER, Judge

This case is back before us after having been remanded to supplement the record in

Foster v. The Manhattan Grp., LLC, 2023 Ark. App. 210. Sandra Foster appeals a Jefferson

County Circuit Court judgment granting $13,906.15 in attorney’s fees to appellee, The

Manhattan Group, LLC, d/b/a Foster Motor Company (TMG). She contends that the

circuit court erred in awarding fees because (1) they are not recoverable for replevin and

conversion claims; (2) no motion for fees was filed in this case within fourteen days of

judgment; and (3) TMG is not a party and had not been awarded any relief. We reverse.

I. Factual and Procedural History

On June 11, 2021, TMG filed a complaint for replevin against Sandra in the Jefferson

County Circuit Court, stemming from her continued possession of a 2016 GMC Yukon

Denali. The Yukon came into Sandra’s possession in 2017 when her then husband, Noel Foster, executed a promissory note and security agreement for its purchase as “Noel Foster,

d/b/a Foster Motor Company.” Sandra answered the complaint, asserting that the Yukon

was marital property, and all interests in it should be determined in the divorce proceeding

between her and Noel that was also pending in the Jefferson County Circuit Court, albeit

in a different division. On September 20, TMG filed an amended complaint adding a

conversion claim. The style of the amended complaint delineated TMG as “The Manhattan

Group, LLC, d/b/a Foster Motor Company”1 rather than “The Manhattan Group, Inc.,

d/b/a Foster Motor Company,” as it had been styled in prior pleadings.

An order was entered October 5 stating that the replevin case had been consolidated

with the divorce case. The order set out in relevant part that the circuit court had concluded

that TMG owned the Yukon and was entitled to immediate possession. The order awarded

TMG $3250, representing the five loan payments that TMG paid after demand but before

Sandra returned the Yukon. The order also set out that the court would conduct further

proceedings for Sandra’s “retention, diminution in value, any damages to the vehicle while

in . . . [Sandra’s] possession, and attorney’s fees.” It further provided that a hearing had

occurred on September 21, the transcript from which reflects that due to the addition of the

conversion claim the previous day, the circuit court declined to hear that claim. Thus, the

October 5 order addressed only the replevin claim.

1 Foster Motor Company, a car dealership, is a single-member LLC. Its sole member is Lana Foster, Noel’s sister-in-law.

2 On October 18, TMG filed a “Motion for Attorney’s Fees and Costs.” The motion

specified the legal work that had been performed on TMG’s behalf, which included drafting

and sending demand letters, filing the lawsuit, filing an answer to the third-party complaint,

attending hearings, preparing for trial, responding to subpoenas and moving to quash them,

and preparing for and attending depositions. The motion was made pursuant to Arkansas

Rule of Civil Procedure 54(e)(1) (2022), which provides that “[c]laims for attorneys’ fees and

related nontaxable expenses shall be made by motion” filed within fourteen days after entry

of judgment. The motion posits that “damages to be assessed for the unlawful detention of

a vehicle, for damages, and for legal fees incurred in recovery of the vehicle” are permitted

pursuant to Arkansas Code Annotated section 18-60-820 (Repl. 2015) and McQuillan v.

Mercedes-Benz Credit Corp., 331 Ark. 242, 961 S.W.2d 729 (1998). Attached in support of the

motion is the affidavit of TMG’s attorney reflecting his hourly rate as $325; an order from

another case in which the attorney was awarded an hourly rate of $335; and invoices

reflecting legal fees of approximately $13,000.

On November 1, Sandra responded to the motion, arguing that attorney’s fees may

not be awarded unless expressly provided for by statute or rule; there is no statute or rule

allowing for fees or costs in a replevin cause of action; fees are generally not permitted in tort

actions; and in McQuillan, fees were awarded on the conversion claim, not the replevin claim.

She contended that the Yukon was returned undamaged; the court had already granted

TMG damages for the detention of the Yukon—the $3250; and TMG was not entitled to any

further damages, fees, or costs. On November 9, TMG replied, arguing that McQuillan

3 provides for the award of attorney’s fees in a replevin action and that “attorney’s fees and

costs are allowed as damages in attempts to recover possession of the truck.”

At the January 15, 2022 hearing on the fee motion, Lana Foster testified that TMG’s

attorney had been hired to file the complaint and that the costs incurred by TMG “in pursuit

of this action” were necessary. The attorney’s bills were introduced as exhibits. Sandra

testified that she had driven the Yukon continuously for the last six years, but as ordered,

she had returned it and paid the $3250. On February 15, a judgment was entered granting

TMG’s fee motion and awarding TMG $13,906.15.2 This appeal followed.

II. Standard of Review

The award of attorney’s fees is reviewed under an abuse-of-discretion standard. Piping

Indus. Co., Inc. v. Future Fuel Chem. Co., 2013 Ark. App. 549, at 4. The circuit court’s decision

will not be reversed absent an abuse of that discretion. Vereen v. Hargrove, 80 Ark. App. 385,

395, 96 S.W.3d 762, 768 (2003). However, a clearly erroneous interpretation or application

of a law or rule will constitute a manifest abuse of discretion. Id.

III. Discussion

Sandra first argues that attorney’s fees are not recoverable for replevin and conversion

claims. The parties use replevin and conversion interchangeably, but they are distinct and

separate causes of action, see France v. Nelson, 292 Ark. 219, 221, 729 S.W.2d 161, 163

2 The order also dismissed as moot a motion for contempt that had been filed by TMG on January 18. The order further stated that “all claims and motions pending in this matter not otherwise disposed of are dismissed,” which disposed of the then outstanding conversion claim.

4 (1987), and the only cause of action upon which the judgment was entered was for the

replevin claim. Thus, as to Sandra’s first argument, the only question properly before this

court is whether attorney’s fees are recoverable for a replevin claim. In support of reversal,

Sandra argues that three cases have held that attorney’s fees are not permitted for litigating

a replevin cause of action: McQuillan, supra; Brown v. Blake, 86 Ark. App. 107, 161 S.W.3d

298 (2004); and Nef v. Ag Services of America, Inc., 79 Ark. App. 100, 86 S.W.3d 4 (2002).

TMG responds that McQuillan does permit the award of attorney’s fees in a replevin

cause of action, and Ark. Code Ann. § 18-60-820 governs the award of damages in a replevin

case. Ark. Code Ann. § 18-60-820 provides:

(a) In an action to recover the possession of personal property, judgment for the plaintiff may be for the delivery of the property, or for the value thereof in case a delivery cannot be had, and damages for the detention.

(b) When the property has been delivered to the plaintiff and the defendant claims a return thereof, judgment for the defendant may be for the return of the property, or its value, in case a return cannot be had, and damages for the taking and withholding of the property.

TMG responds further that the fees are permissible because Sandra “chose to pull the

replevin action into her divorce case”; fees may be awarded in a divorce action to the

prevailing party; and Sandra may not now complain about the fees pursuant to the invited-

error doctrine since she chose to “blend” the two cases.

Sandra replies that the fees were incurred litigating the replevin case, and precedent

makes clear that awarding fees in such a case is impermissible. Regarding TMG’s argument

that its fees are permitted because they were awarded in a divorce action, Sandra replies that

5 TMG never argued that it could recover its fees because of the consolidation, and it was clear

that the fees were sought for services incurred pursuing the replevin and conversion claims.

Regarding the availability of attorney’s fees in a replevin case, the parties seem to agree

that McQuillan dictates the result in this matter but disagree on what McQuillan mandates.

In McQuillan, appellee Mercedes-Benz Credit Corporation (MBCC) sued appellants Gary D.

McQuillan and America’s Truckaway Systems, Inc., for replevin, praying alternatively for

relief under a theory of conversion. 331 Ark. at 245, 961 S.W.2d at 730. The circuit court

found that appellants had committed the tort of conversion and awarded $17,509.52 in

damages and $1000 in attorney’s fees to MBCC. Id. Of the $17,509.52 in damages,

$13,109.52 was representative of “legal fees” “expended” by MBCC “in its attempts to

recover the trucks [at issue] through the legal processes of various states.” Id. at 246, 961

S.W.2d at 731. On appeal, the appellants argued in part that the damages award was

improperly calculated, and the attorney’s fees should not have been awarded. Id. at 249, 961

S.W.2d at 733.

Our supreme court affirmed the damages award of $17,509.52. Id. It explained that,

ordinarily, the proper measure of damages for conversion is the market value of the property

at the time and place of its conversion, but this is not the only measure of the damages

recoverable in a conversion action, and the circumstances of the case may require a different

standard, including a measure of the expenses incurred because of the conversion. Id. at 250,

961 S.W.2d at 733. It further explained that even though MBCC did eventually receive

possession of the converted property, the circuit court did not err in awarding the amount

6 of damages it did, which included the “costs”—the legal fees—that were expended by MBCC

in its attempts to recover possession of the two trucks. Id., 961 S.W.2d at 734. It stated that

it “has acknowledged the permissibility of awarding damages in an action for conversion

based upon the expenses incurred as a result of the conversion.” Id. at 250–51, 961 S.W.2d

at 734. The court noted with approval that in other jurisdictions, while attorney’s fees

incurred in the prosecution of a conversion action were not recoverable, attorney’s fees spent

in recovering possession of the converted property were properly awarded as special damages

by the trial court. Id. at 251, 961 S.W.2d at 734. The court further noted that it saw “no

reason to distinguish the award of such expenses based upon whether the actions taken to

secure the return of the property were performed by attorneys or persons of other

occupations, such as repossession agents.” Id.

However, the court did reverse the $1000 awarded specifically for attorney’s fees

because it was “apparent” that the “the trial court awarded $1,000.00 to MBCC separately

as attorney’s fees for action taken in pursuit of the civil claims, rather than as part of the

costs incurred by MBCC in the recovery of the trucks.” Id. at 252, 961 S.W.2d at 734. It

stated that the “general rule in Arkansas is that attorney’s fees incurred in the pursuit of civil

actions are not awarded unless expressly provided for by statute or rule,” and “Arkansas Code

Annotated [section] 16-22-308 (Repl. 1994), which provides for attorney’s fees in specific

civil actions, does not allow attorney’s fees in tort actions.” Id. It then held that “the trial

court erred in awarding that sum to MBCC, as attorney’s fees incurred generally in the

7 prosecution of replevin and conversion actions are not expressly provided for by statute.” Id.

at 252, 961 S.W.2d at 734–35 (emphasis added).

The other two cases relied on by Sandra, Nef, supra, and Brown, supra, both reiterate

that Ark. Code Ann. § 16-22-308 does not provide for the recovery of attorney’s fees in tort

actions and recognize that McQuillen held that the aggrieved party was not entitled to an

award of attorney’s fees for expenses incurred in litigating conversion and replevin claims, as

opposed to the costs incurred in the recovery of the property itself.

Finally, TMG’s argument that the fee award was permissible because the replevin case

was consolidated with the divorce case and thus was invited error is unpersuasive. While

TMG is correct that Arkansas Code Annotated § 9-12-309(a)(1)(A)(ii)(Repl. 2020) permits

attorney’s fees to the prevailing party in a divorce action, the record is clear that the fees were

awarded to TMG as the prevailing party with respect to the replevin claim—not as a prevailing

party to the divorce.

The only cause of action that TMG prevailed upon was for replevin—a tort—and not

a cause of action for which there is statutory authority to award fees. The fees requested and

granted were attorney’s fees incurred in litigating the replevin claim. The motion filed was a

motion for attorney’s fees, not costs of recovery. Damages were awarded in the October 5

order. McQuillen makes clear that while legal costs incurred in recovering property—whether

performed by an attorney or a nonlegal professional—may be awarded as damages; attorney’s

fees incurred for action taken in pursuit of the civil claim and awarded as attorney’s fees are

not. Here, unlike McQuillen, no fees were awarded as part of the damages awarded to TMG.

8 Accordingly, the circuit court abused its discretion in granting the fee motion, and the

judgment awarding $13,906.15 is reversed. Because we reverse the award of fees on the basis

of Sandra’s first argument, we do not address her remaining arguments.

Reversed.

VIRDEN and BROWN, JJ., agree.

Brett D. Watson, Attorney at Law, PLLC, by: Brett D. Watson, for appellant.

McDaniel & Wolff, PLLC, by: Scott P. Richardson, for appellee.