Texas Supreme Court holds successful lawyer against City failed to establish proper attorney’s fees.

City of Laredo v Montano, et al, No. 12-0274 (Tex. October 25, 2013).

This is an eminent domain case (mainly for litigators)  released today from the Texas Supreme Court  appealing a jury determination that the City’s condemnation of certain property was not for a “public use” and an award for attorney’s fees and expenses to the property.  This case is really about the attorney’s fee portion of the award. The City appealed the award, complaining about deficiencies in the property owner’s attorney’s fees proof.  The Texas Supreme Court determined deficiencies existed, reversed the award and remanded.

In December 2004, the City decided it needed the Montanos’ property to widen a street and build a pedestrian plaza near the bridge. The Montano’s alleged no public purpose really existed but rather was merely intended to benefit El Portal Center, a private entity operating a nearby shopping center. The case was tried to a jury who agreed with the Montanos that the City had no authorized public use. The trial court rendered judgment on the jury verdict, awarding the Montanos $446,000 in attorney’s fees. The trial court awarded the fees in a lump sum, but the court of appeals divided the sums based on the representation of the three Montano attorneys. However, the lead attorney testified he did not keep time records in the case. Moreover, he apparently did not have a firm idea about what the Montanos owed him for his work before his testimony at trial (which he admitted was his first condemnation case). The City complains that the evidence of attorney’s fees is insufficient because two of the three failed to produce time records, billing statements, or even a client agreement to substantiate their fee requests.

The Court held that a Lodestar calculation (attorney’s fee standards case) requires certain basic proof, including itemizing specific tasks, the time required for those tasks, and the rate charged by the person performing the work.  It does not have to be in the form of itemized billing records, but must meet certain standards.  For two of the three attorneys (the lower amounts) sufficient time records and/or testimony was provided.  The Court provided some guidance as to how an attorney can enable proper fees without providing billing records, so that is something defense attorney’s need to watch out for.  However, the Court was pretty clear that the lead attorney failed entirely to establish an entitlement to fees with the proof provided.  The fee award entitlement does not vanish; it merely was sent back down to the trial court with some guidance on how such fees must be proven.

If you would like to read this opinion click here.