The law of North Dakota regarding attorney fees is rather common in the
various states. So let us take a look at it to get some of the doctrines that
chances are will be discussed in the cases in your jurisdiction. Well
before federal courts started discussing "lodestar" amounts and formulating
doctrines of law, the state courts, like North Dokota, judicially noted the elements that go into determining a
reasonable fee. City of Bismarck v. Thom (ND, 1977) was
typical. It stated that the base
for determining a reasonable fee is found by multiplying the number of hours
expended by each attorney by the hourly rate normally charged for similar work
by attorneys of like skill in the area. The court noted that it was for
similar work by attorneys of like skill, which is not necessarily the same
as the average hourly rate of all attorneys in the area. When this base
rate is established than other less objective factors are introduced to
determine a reasonable fee.
Estate of Hass,
2002 ND 82 awarded attorney fees against the estate of a decedent for legal services
included by an objector in a will contest because
the proceedings benefited the estate as a whole. This cases well discusses the
theory involved. It is a reminder to attorneys that attorney fees may be awarded in times when attorneys often overlook
the possibility of recovering them. In Estate of Hass, the court sums up
by saying.
[¶21] In Estate of Rohrich, 496 N.W.2d 566, 570 (N.D. 1993), this
Court considered the issue of whether an attorney who is employed by a
beneficiary for a will contest can recover attorney fees from the estate.
This Court concluded there is no statutory basis for an award of attorney
fees for legal services performed primarily for the personal interest of a
beneficiary, but recognized the trial court may award attorney fees, as a
matter of equity, for legal services benefiting the estate as a whole:
It has been held that the equitable power of a court authorizes an award
of attorney fees in an action by one person which benefits a class of
persons, thus making it equitable to spread the costs of the action among
the members of the benefited class. More specifically, some states allow
beneficiaries to recover fees in equity when, at their own expense and not
for their sole benefit, their attorney's services benefited the estate as a
whole by increasing a common fund in which other beneficiaries might share.
The case of T.F.
James Co. v. Vakoch, 2001 ND 112, 628 N.W.2d 298 is one in which the ND
appellate court had to give some strict instructions to the trial court on the
usual way the ND Supreme Court wants an award of attorney's fee to be
calculated. The result is that this case
[T.F. James
Co. v. Vakoch, 2001 ND 112, 628 N.W.2d 298 -- the second appeal in the case]
will probably be the standard which trial courts will use in most cases in that
state. The case specified that the court should look at the reasonable number
of hours expended and multiply that times the "lodestar" rate per hour. The
"lodestar" rate for the case was described as follows.
[¶23] To guide the district court in determining the reasonableness of the
fees it shall award, we identify the factors in N.D.R.Prof. Conduct 1.5(a):
(1) the time and labor required, the novelty and difficulty of the
questions involved, and the skill requisite to perform the legal service
properly;
(2) the likelihood, if apparent to the client, that the acceptance of the
particular employment will preclude other employment by the lawyer;
(3) the fee customarily charged in the locality for similar legal
services;
(4) the amount involved and the results obtained;
(5) the time limitations imposed by the client or by the circumstances;
(6) the nature and length of the professional relationship with the
client;
(7) the experience, reputation, and ability of the lawyer or lawyers
performing the services; and
(8) whether the fee is fixed or contingent.
This Court has uniformly held that when determining the reasonableness of
attorney fees, all factors must be considered and no single factor controls.
In determining fees on remand, the district court shall first decide the
number of hours reasonably expended, and then determine a reasonable hourly
rate. See City of Medora v. Golberg, 1997 ND 190, ¶¶ 19-22, 569 N.W.2d 257
(applying the "lodestar" method rather than proportionality of fees to the
verdict); see also City of Bismarck v. Thom, 261 N.W.2d 640, 646 (N.D. 1977)
(identifying the manner of calculation, identifying total hours and rate per
hour as "predominate," and stating evidence and specific findings are
necessary); and Hughes v. North Dakota Crime Victims Reparations Bd., 246
N.W.2d 774, 777 (N.D. 1976) (identifying "the undesirability of the case" and
"awards in similar cases"). After this analysis, the fees shall not be reduced
based on any other factor.
This T.F. James case is also noteworthy for its discussion of when the
parties can contract for attorneys fees to be paid by a losing party to
litigation.
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