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W-T Holdings, LLC v. Gilchrist

Court of Appeals of Mississippi

December 17, 2019


         DATE OF JUDGMENT: 04/24/2018




         EN BANC

          J. WILSON, P.J.

         ¶1. This appeal relates solely to an award of attorneys' fees pursuant to a contract. W-T Holdings LLC d/b/a Window World sued Robert Gilchrist for breach of contract after he refused to pay for windows installed at his home. Window World alleged that Gilchrist owed $5, 690.35. The case eventually proceeded to trial in county court. The jury found in favor of Window World but awarded damages of only $2, 646. Post-trial, Window World sought attorneys' fees under a contract provision that required Gilchrist to "pay all" of Window World's "collection cost, attorney fees and all other expenses related to enforcing" the contract. The county court awarded Window World attorneys' fees of $18, 400, although there was no evidence that Window World had actually incurred or owed that amount.

         ¶2. Gilchrist appealed to the circuit court. He argued, as he had in the county court, that the contract did not require him to pay attorneys' fees in excess of the fees that Window World actually incurred to enforce the contract. The circuit court agreed with Gilchrist and reversed and rendered the judgment to include only "the actual amount of attorney's fees incurred by Window World" ($1, 323).

         ¶3. Window World filed a motion for reconsideration along with a new affidavit in which it claimed, for the first time, that it had actually incurred attorneys' fees of $45, 175. The circuit court struck the new affidavit and denied Window World's motion for reconsideration. Window World then appealed.

         ¶4. We hold that the circuit court, sitting as an appellate court, correctly applied the parties' contract to the record on appeal. Therefore, we affirm the judgment of the circuit court.


         ¶5. The underlying facts of this case are not important to the appeal, as neither party contests the jury's verdict awarding Window World damages of $2, 646.[1] In short, Gilchrist contracted with Window World to install a number of windows at his residence for a contract price of $5, 690.35, but Gilchrist was dissatisfied with Window World's work and ultimately refused to pay. Window World sued Gilchrist in county court for the contract price plus attorneys' fees, other collection costs, and interest. Gilchrist initially filed a pro se answer and counterclaim in which he sought, among other relief, $100, 000 for alleged harm to his credit and reputation and "mental fatigue." Gilchrist later retained counsel and filed an amended answer and counterclaim. The amended counterclaim sought damages "for the cost of repair and proper installation of [a] picture window" but did not mention mental distress or demand any specific sum as damages.

         ¶6. The case eventually proceeded to trial, and the jury found in favor of Window World on its claim for breach of contract but awarded damages of only $2, 646, or less than half of the amount Window World alleged was owed. The jury also found in favor of Window World on Gilchrist's counterclaim.

         ¶7. Post-trial, Window World filed a request for attorneys' fees pursuant to a provision in the parties' contract. That provision, which appears in small print in Window World's preprinted standard form contract, states as follows:

Default/Collection Policy In the event client defaults on Contract, they will be responsible to pay all collection cost, attorney fees, court cost, and all other expenses related to enforcing W-T Holdings LLC, DBA Window World of Mobile/Gulfport terms of agreement/contract to the [sic] permitted by law. 1.5% will be added on monthly.

         ¶8. In support of Window World's request for attorneys' fees, its lawyer (Weldy) submitted an affidavit with timesheets. Weldy itemized 137.25 hours of work between 2013 and 2015, for which he requested fees of $27, 450. Weldy also submitted a timesheet for a recent law school graduate (Riley) who had assisted Weldy with trial preparation and the trial, although she was not yet admitted to the bar. Riley's timesheet itemized 72.5 hours in August and September 2015, for which Window World requested fees of $10, 875. Weldy's affidavit further stated:

8. The fees charged for services in this matter are reasonable. They are based on an hourly rate of $150 per hour for a law school honors graduate with extensive trial practice experience and $200 per hour for a partner. . . .
10. The fees herein are by the hour and attached as Exhibits B and C are the timesheets for work performed in this case.

         ¶9. Although Weldy's affidavit referred to "fees charged for services," the affidavit as a whole was ambiguous as to whether Window World actually was billed for or owed those "fees."[2] Window World also submitted an affidavit from its owner, Henry Santelices, that stated that it had "incurred collection costs, court costs, and other expenses related to enforcing the terms of the contract in the amount of $2, 040.99." Santelices itemized those costs, but he did not mention any attorneys' fees that Window World had paid or owed.

         ¶10. In response to Window World's request for attorneys' fees, Gilchrist highlighted the apparent ambiguity in Window World's affidavits and pointedly questioned whether Window World had actually incurred the requested fees. Gilchrist argued:

[N]either of the Affidavits submitted by Window World reveal the amount of fees Window World actually incurred with its attorney.
To be sure, we have a detailed record of the lawyer's time sheets, but that alone does not tell us that the client (Window World) actually paid those (or owes those by contract with its attorney). While the Attorney's Fee Affidavit submitted by Mr. Christopher Weldy includes an itemization of his time, it never actually says that he charged Window World $38, 325 for his services.
Similarly, the Affidavit of Henry Santelices contains a list of his out-of-pocket expenses, but it never reflects that Window World actually paid (or owes) $38, 325 to Mr. Weldy for having obtained a jury verdict in the amount of $2646.
As a result, both Affidavits are insufficient to establish what Window World has paid to (or owes to) its attorney.
Logic and law tells us that before Window World can ask to be reimbursed for its reasonable attorney's fees, it must tell the Court what those fees actually were.

         ¶11. In its rebuttal in support of its request for attorneys' fees, Window World responded to Gilchrist's argument. However, Window World did not claim that it had actually paid or owed the amounts reflected in Weldy's timesheets. Rather, Window World argued:

The issue regarding fees is whether they are reasonable, not how much the client actually paid. Regardless, counsel for Window World is producing its contingency fee contract as Exhibit A. Counsel for Window World pursued this claim with no money being paid up front by Window World, and then had to defend Window World against a [counter]claim for $100, 000.[3] Typically where the fee is contingent, courts have awarded a multiplier to counsel for taking the risk associated with a contingent fee matter. . . . Since $100, 000 was initially at stake for Window World, and the contingent contract provides for attorney's fees at 50%, Window World would be entitled to $50, 000 in attorney's fees . . . .
If Defendant wants to argue that counsel's hourly fees amount is unreasonable, Window World is amenable to an award of $50, 000 or whatever multiple of $50, 000 the court deems reasonable.

         "Exhibit A" was a signed "Contingency Fee Contract for Legal Services" between Window World and Weldy. The agreement provided that if the case went to trial, Window World would pay Weldy "Fifty Percent (50%) of any sums recovered." Near the end of its rebuttal memorandum, Window World expressly argued: "The fee is contingent in this matter, which supports an award of fees above the standard hourly fees requested."

         ¶12. The county court held a hearing on Window World's request for attorneys' fees. Weldy argued in support of the request, but he still did not clarify what fees Window World actually had paid or owed. Gilchrist's attorney began his argument in response as follows:

Right out of the gate I have to ask for a clarification from my counsel opposite. He said those fees that he is seeking were billed. It was not my impression from anything that was filed that his client was actually billed for those fees and owes them. If I'm mistaken, I would like to know that since what he has given us is a contingency fee contract, not an hourly rate contract. All right, I guess we are not going to get an answer to that.

         Gilchrist further argued, "This contract between Window World and its lawyer is a contingency fee contract, so the hourly rate is not what Window World owes, it's not what Window World was billed." Gilchrist maintained that he could only be held liable for Window World's actual attorneys' fees.

         ¶13. Weldy returned to the podium for rebuttal but did not provide any clarification. Rather, he argued that the court should award at least twice the attorneys' fees that he had requested because he "took [the case] on a contingency fee basis":

Your Honor, . . . the attorney's fees paid by Window World is irrelevant. In cases like this that have been taken on a contingency fee contract, I cited a case, [Forbush v. J.C. Penney Co., 98 F.3d 817 (5th Cir. 1996)]. In that case the court found that a multiplier of two was reasonable when an attorney took a case under a contingency fee contract.
So even looking at my total fees and applying a multiplier of two to that would be reasonable. Because I took it on a contingency fee basis, I was paid nothing up front. This is all risk I incurred on my end pushing this case to a jury trial because the defendant won't even make any offer of judgment in this case.

         ¶14. The court announced its ruling from the bench and subsequently entered a written order, but neither the oral ruling nor the written order provided any analysis or explanation. The court simply awarded $23, 400 for attorneys' fees-$18, 400 for Weldy's work and an additional $5, 000 for Riley's work. The court also awarded costs and expenses in the amount of $2, 040.99 based on Santelices's affidavit. Gilchrist appealed to circuit court.

         ¶15. In the circuit court, Gilchrist continued to argue that Window World was entitled to recover no more than the attorneys' fees that it had actually incurred under its agreement with Weldy-i.e., fifty percent of the jury verdict, or $1, 323. Gilchrist emphasized that there was nothing in the record ...

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