Opinion
No. HHB-CV 06 5001541-S
August 8, 2008
MEMORANDUM OF DECISION RE JUDGMENT OF FORECLOSURE
A hearing on the judgment to be entered in foreclosure of the plaintiff, Northeast Tank Environmental Services, Inc.'s (Northeast) mechanic's lien was held on June 24, 2008. The plaintiff's complaint, dated May 16, 2006, contained counts entitled: "foreclosure of mechanic's lien," "breach of contract," "detrimental reliance," and "unjust enrichment." The matter was tried to the court, Prestley, J., over two days. Both parties filed extensive post-trial briefs. On January 4, 2008, the trial court filed a fifteen-page memorandum of decision which contained the following findings: The amount of the plaintiff's mechanic's lien was $378,900.49 and there existed a lienable fund sufficient to cover the amount of the lien. There was no contract between Northeast and TA Operating Corp. (TA). The plaintiff met its burden of proof on the promissory estoppel and unjust enrichment counts and was entitled to damages in the amount of $378,901.00. The court specifically stated that the award of damages did not constitute multiple recovery. The foregoing proceedings are referred to as the "underlying action."
The matter was referred to this court for a hearing on the foreclosure. At the hearing, the parties stipulated to following findings: The amount due the plaintiff, pursuant to the court decision, is $378,901.00. The value of the property that is the subject of the mechanic's lien is $6,100,000.00. The parties also agreed that a judgment of foreclosure by sale may enter with a sale date that is at least ninety days from the date of the entry of judgment.
The parties are not in agreement on the issue of attorneys fees. The plaintiff maintains that General Statutes § 52-249 authorizes an award of attorneys fees for the underlying action and it seeks an allowance of $99,681.60. The defendant claims that attorneys fees allowed under § 52-249 are limited only to those fees incurred for a hearing as to the form of judgment in the foreclosure action. There are superior court cases that support the defendant's position, including AA Mason, LLC v. Montagno Construction, Inc. 49 Conn.Sup. 405, 889 A.2d 278 (2005) [ 39 Conn. L. Rptr. 339].
This court is persuaded by the language used by our Appellate and Supreme Courts that, in this case, General Statutes § 52-249 authorizes the allowance of attorneys fees in connection with the underlying action.
"The guidelines for interpreting mechanic's lien legislation are well established. Although the mechanic's lien statute creates a statutory right in derogation of the common law . . . its provisions should be liberally construed in order to implement its remedial purpose of furnishing security for one who provides services or materials." (Citations omitted.) Nickel Mine Brook Associates v. Joseph E. Sakal, P.C., 217 Conn. 361, 364, 585 A.2d 1210 (1991).
In the case of A. Secondino Son, Inc. v. LoRicco, 19 Conn.App. 8, 561 A.2d 142 (1989), the defendant in a foreclosure of mechanic's lien action claimed that the trial court erred in awarding attorneys fees. The Appellate Court affirmed the trial court and stated, "Connecticut case law follows the general rule, frequently referred to as the `American Rule,' that attorneys fees are not allowed to the prevailing party as an element of damage unless such recovery is allowed by statute or contract . . . General Statutes § 52-249(a) succinctly and unambiguously provides for the allowance of attorneys fees in actions for foreclosure of mortgages or liens.
"The defendant asks us to examine the statute's legislative history and thereby arrive at a construction that would support his claim of error. We decline to do so. Courts will look to legislative history as an aid to construction only if the statute is ambiguous . . . A statute does not become ambiguous solely because the parties disagree as to its meaning. If the words of a statute are clear, the duty of a reviewing court is to apply the legislature's direction, since where the wording is plain, courts will not speculate as to any supposed intention. The question before a court then is not what the legislature actually intended, but what intention it expressed by the words that it used." (Citations omitted, internal quotation marks omitted.) A. Secondino Son, Inc. v. LoRicco, supra, 19 Conn.App. 15-16.
In view of the Appellate Court's determination that the language of General Statutes § 52-249 is succinct and unambiguous, it not necessary for this court to engage in an extratextual analysis. The instant case differs from AA Mason in which the court dealt with the issue of § 52-249 attorneys fees in an action where a bond had been substituted for a mechanic's lien. This court also notes that the AA Mason court relied, in part, on the superior court case of Wright Bros. Builders, Inc. v. Dowling, Superior Court, judicial district of Stamford-Norwalk at Stamford, Docket No. CV 94 0136604 (September 27, 1999, Lewis, J.) which was decided before Original Grasso Construction Co. v. Shepherd, 70 Conn.App. 404, 799 A.2d 1083, cert. denied, 261 Conn. 932, 806 A.2d 1065 (2002), discussed below, wherein the Appellate Court elaborated on its holding in Secondino Son.
The case of Original Grasso Construction Co. v. Shepherd, supra, is instructive. In Original Grasso, the plaintiff was successful in the foreclosure of a mechanic's lien and sought attorneys fees pursuant to General Statutes § 52-249. The trial court declined to award attorneys fees for the underlying action, but did award attorneys fees in the amount of $675.00 for the foreclosure action. After quoting the holding of Secondino Son, the Appellate court stated: "In addition, § 52-249 provides that the plaintiff may be awarded attorneys fees in an action to foreclose a lien ` upon obtaining judgment of a foreclosure' . . . General Statutes § 52-249(a). According to § 52-249(a) the plaintiff must argue for attorneys fees during the foreclosure action." Id., 418. The court thereafter held, "Section 52-249(a) mandates that the plaintiff in a foreclosure action shall be allowed reasonable attorneys fees `when there has been a hearing as to the form of judgment' during the foreclosure action . . . We therefore hold that the court in the foreclosure action must determine whether a party is entitled to attorneys fees pursuant to § 52-249 that were incurred in the litigation of the underlying action." (Emphasis in original.) Id., 119. The court then remanded the case for determination of whether and to what extent the plaintiff may be entitled to attorneys fees pursuant to § 52-249. Id., 419. It is reasonable to conclude that the plaintiff in Original Grasso was eligible for attorneys fees in the underlying action, in addition to the fees awarded for the foreclosure judgment hearing. Another superior court judge has cited Secondino Son and Original Grasso for authority to award attorneys fees in the underlying proceeding to foreclose a mechanic's lien. See Ditullio v. Ross, Superior Court, judicial district of Danbury, Docket No. 00 0340116 (October 25, 2002, Moraghan, J.T.R.).
Two recent cases implicitly support the court's conclusion that attorneys fees under § 52-249 are not limited only to the foreclosure hearing. In the case of Moasser v. Becker, 107 Conn.App. 130, 946 A.2d 230 (2008), the Appellate Court held that General Statutes § 52-249 authorized postjudgment attorneys fees in a foreclosure action. The Supreme Court reinstated a trial court's award of $27,225 for attorneys fees to a plaintiff, in accordance with Section 52-249, in a mechanic's lien foreclosure where the contract between the parties did not provide for attorneys fees. See Intercity Development, LLC v. Andrade, 286 Conn. 177, 942 A.2d 1028 (2008).
In this case the plaintiff is timely seeking attorneys fees for the underlying action at the hearing where the court determines the form of judgment, having established the amount of its mechanic's lien in the earlier proceedings. As noted earlier, the plaintiff did not have a direct contract with the defendant, but was a sub-contractor who provided materials and labor to the property owned by the defendant. The defendant filed a special defense which stated, "TA (defendant) made good faith payments to Elite Paving Excavating, LLC, the person through whom NE Tank (plaintiff) asserts its lien, in an amount to substantially reduce or extinguish NE Tank's lien. See Conn. General Statute §§ 49-33 and 49-36." It is clear from the posttrial briefs, and the court's memorandum of decision, that the issue of whether the defendant's payments to Elite were made in good faith was an important element in the case. It is understandable that the plaintiff incurred substantial attorneys fees in preparing for the trial which revolved around this issue. The adjudication of the defendant's special defenses is a necessary component of plaintiff's foreclosure action. Although the plaintiff's complaint sounded in breach of contract and related causes of action, the plaintiff seeks only attorneys fees in connection with the foreclosure of its mechanic's lien, which by necessity include attorneys fees incurred in withstanding the defendant's special defenses.
In considering the plaintiff's claim for attorneys fees the court is guided by the case of Smith v. Snyder, 267 Conn. 456, 839 A.2d 589 (2004). "Accordingly, when a court is presented with a claim for attorneys fees, the proponent must present to the court at the time of trial or, in the case of a default judgment, at the hearing in damages, a statement of the fees requested and a description of services rendered. Such a rule leaves no doubt about the burden on the party claiming attorneys fees and affords the opposing party an opportunity to challenge the amount requested at the appropriate time.
"Our holding today does not limit the trial court's ability to assess the reasonableness of the fees requested using any number of factors, including its general knowledge of the case, sworn affidavits or other testimony, itemized bills, and the like. As we recognized in Piantedosi, `[t]he value [of reasonable attorneys fees] is based upon many considerations.' (Internal quotation marks omitted.) Piantedosi v. Floridia, supra, 186 Conn. 279, quoting Hoenig v. Lubetkin, 137 Conn. 516, 524, 79 A.2d 278 (1951).
"In addition, as a matter of good policy, our holding today establishes a paradigm within which all parties must act when pursuing a claim for attorneys fees. Perhaps, even more importantly, our holding eliminates the undesirable burden imposed upon the courts when a party seeks an award of attorneys fees predicated solely upon a bare request for such fees. Parties must supply the court with a description of the nature and extent of the fees sought, to which the court may apply its knowledge and experience in determining the reasonableness of the fees requested." Smith v. Snyder, supra, 267 Conn. 456, 479-80.
As stated earlier, the plaintiff seeks attorneys fees in the amount of $99,681.60. In support of this request its attorneys have submitted two affidavits for attorneys fees and a supplemental memorandum dated July 18, 2008, with attached billing invoices. The first affidavit, dated April 18, 2008, refers to invoices for services rendered from April 2006 through October 2007, and requests fees in the amount of $84,599.10. The second affidavit is a supplemental affidavit for attorneys fees, it refers to services rendered from November 2007 through May 2008, and requests fees in the amount of $15,082.50. Both affidavits contain a statement of the fees requested and a description of the services rendered. At the foreclosure hearing attorney Michael J. Donnelly, the affiant of the first affidavit and partner on the file, testified regarding the services rendered to the plaintiff and was cross-examined by defendant's counsel.
From April 2006 through May 2008, Attorney Donnelly spent approximately 230 hours on this case. At the start of this period his hourly rate was $295.00 and at the end of the period it was $340.00. In 2007, when the bulk of the time was spent, 188 hours, his hourly rate was $325.00 and the court will utilize this hourly rate in its further calculation. Attorney Castricone spent approximately 225 hours on this case. In 2006 her hourly rate was $170.00 per hour and it was $210.00 per hour in 2008. The bulk of the time she spent was in 2007, 157 hours, when her hourly rate was $185.00 and this rate will be utilized. Attorney Donnelly and Attorney Castricone spent approximately the same amount of time on this case and the Court finds that $255.00 per hour, the average of their utilized rates, is a reasonable rate.
The first affidavit summarizes the number of hours billed by the plaintiff's attorneys through October 2007; the total is 395.8 hours. In his affidavit, and in testimony, Attorney Donnelly stated that ninety percent of this time was for the mechanic's lien foreclosure aspect of the case, the balance of the time was allocated to the other counts in the plaintiff's complaint. After reviewing the posttrial briefs and the memorandum of decision, the court finds this allocation to be reasonable. The first affidavit indicates that Attorney Donnelly billed a total of 212.1 hours for the period and a reduction of ten percent results in 190.9 hours. The affidavit also indicates that Attorney Castricone billed 183.7 hours and a ten percent reduction results in 165.3 hours. The second affidavit summarizes the hours billed from November 2007 through May 2008 and the plaintiff's attorneys state that all this time is related to the foreclosure issues. The second affidavit indicates that Attorney Donnelly billed 18.3 hours and Attorney Castricone billed 41.1 hours. In summary, Attorney Donnelly spent 209.2 hours and Attorney Castricone spent 206.4 hours on this foreclosure case, for a total of 415.6 hours. The court declines to consider amounts charged by the law firm for paralegal services.
The billing records indicate that there were four depositions taken and the trial took two days. The issues presented in this case were relatively straight-forward, however, extensive preparation was certainly required. On the other hand, the subject matter was not overly technical and there were no expert witnesses. Although the plaintiff's attorneys may have believed it was preferable to have two attorneys each spend over 200 hours on the file, the court cannot find that such was reasonable. Applying its knowledge and experience, the court concludes that it is reasonable to allow the plaintiff's attorneys one-half of the hours requested or 207.8 hours. In reaching this conclusion, the court notes that the actual depositions in the case consumed 45.5 hours. The actual trial of the case consumed 15 hours. Deducting the total deposition and trial time of 60.5 hours from the amount of time allowed by the court, 207.8 hours, there remain 147.3 hours. The court finds that 147.3 hours is a reasonable amount of time to allow for pretrial matters including written discovery, preparation for depositions, preparation for trial, and for posttrial briefs. In this foreclosure of mechanic's lien action the plaintiff is allowed a reasonable attorneys fee of $52,989 based upon 207.8 hours at an hourly rate of $255.00.
The court makes the following findings and makes the following orders: The plaintiff is due the sum of $378,901. The value of the subject property is $6.1 million. The plaintiff is allowed attorneys fees in the amount of $52,989, an appraisal fee of $5,000 and a title search fee of $225. A judgment of foreclosure by sale is entered and the sale is ordered to take place on November 15, 2008. Publication of the sale is to be by agreement of the parties. If the parties are unable to agree on the terms of publication they are to return to court to obtain orders regarding publication.