Jackson, D. v. USAA ( 2020 )

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NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37
DEBRA JACKSON : IN THE SUPERIOR COURT OF
: PENNSYLVANIA
:
v. :
:
:
USAA A/K/A, D/B/A AND/OR T/A, :
GARRISON PROPERTY AND :
CASUALTY INSURANCE COMPANY, :
:
Appellants : No. 1259 EDA 2019
Appeal from the Judgment entered May 22, 2019
in the Court of Common Pleas of Philadelphia County
Civil Division at No(s): June Term, 2017, No. 0174
BEFORE: DUBOW, J., McLAUGHLIN, J., and MUSMANNO, J.
MEMORANDUM BY MUSMANNO, J.: Filed: April 30, 2020
USAA a/k/a, d/b/a and/or t/a Garrison Property and Casualty Insurance
Company (“USAA”), appeals from the Judgment awarding Debra Jackson
(“Jackson”) attorney’s fees in the amount of $34,850.1 We affirm.
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1 USAA filed its Notice of Appeal from the trial court’s March 13, 2019, Order,
which granted Jackson’s post-trial Motion requesting, inter alia, counsel fees.
An appeal properly lies from the entry of judgment, not from an order denying
post-trial motions. See Johnston the Florist, Inc. v. TEDCO Constr.
Corp., 657 A.2d 511, 516 (Pa. Super. 1995) (en banc). This Court entered
an Order directing USAA to praecipe the trial court prothonotary to enter
judgment, and USAA complied. Judgment was entered on May 22, 2019.
Thus, USAA’s Notice of Appeal relates forward to the date Judgment was
entered, and there are no procedural/jurisdictional impediments to our review.
See Hart v. Arnold, 884 A.2d 316, 325 n.2 (Pa. Super. 2005) (stating that
“[a] final judgment entered during the pendency of an appeal is sufficient to
perfect appellate jurisdiction.”). We have corrected the caption accordingly.
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The trial court summarized the relevant history underlying the instant
appeal as follows:
On June 5, 2017, [Jackson] filed a civil [C]omplaint seeking
payment of her first party medical bills (“PIP claim”) for injuries
sustained in a motor vehicle accident on November 29, 2015.
[Jackson], a pedestrian who neither owned a motor vehicle nor
resided with anyone who had a motor vehicle, also sought
interest, attorney[’s] fees, and treble damages from [USAA], who
provided motor vehicle coverage to the driver who struck
[Jackson]. The parties stipulated that [USAA] did not pay the PIP
claim until after suit was initiated. By the date of trial, the parties
stipulated, the PIP claim of $5,994.65 was fully paid.
Trial Court Opinion, 10/23/19, at 2.
On November 28, 2018, a non-jury trial was held before [the trial
court] to determine whether [Jackson’s] counsel was entitled to
attorney[’s] fees for representing a claimant in connection with a
claim for first[-]party benefits under the Pennsylvania Motor
Vehicle Financial Responsibility Law (“MVFRL”). [] Jackson[],
represented by [John Trotman, Esquire (“Attorney Trotman”), of]
Silverman, Trotman & Schneider, LLC [], sought first[-]party
benefits for injuries she sustained as a pedestrian in a motor
vehicle accident. The [t]rial [c]ourt found that [] USAA …, without
reasonable foundation, refused to pay [Jackson’s] first[-]party
Personal Injury Protection (“PIP”) benefits, and that, pursuant to
[75] Pa.C.S.A. [] § 1798(b), [Attorney Trotman] was entitled to a
reasonable attorney’s fee for time expended in securing payment
of [Jackson’s] PIP claim.
[Attorney Trotman] submitted a Fee Petition [(the “Fee
Petition”)] in the amount of $100,648.86 on January 7, 2019. The
Fee Petition was broken down as follows:
Attorney[] fees 75,753.00
Costs 5,473.19
Interest on the PIP claim 1,438.72
Treble damages 17,983.95
Total 100,648.86[FN1]
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[FN1][Attorney Trotman] petitioned for an award under [75]
Pa.C.S.A. §§ 1716, 1979(b)(4), and 1798(b), for Payment of
Benefits, Customary Charges for Treatment, and Attorney[’s] Fees
and Costs, respectively.
The [t]rial [c]ourt awarded [Attorney Trotman] $34,850 in
attorney fees and awarded [Jackson] interest in the amount of
$1,438.72 on her PIP claim on March 11, 2018….
Id. at 1-2 (footnote and emphasis in original). USAA timely filed a Notice of
Appeal, followed by a court-ordered Pa.R.A.P. 1925(b) Concise Statement of
matters complained of on appeal.
USAA presents the following claims for our review:
1. Whether the trial court abused its discretion and/or committed
an error of law in awarding attorney’s fees under 75 Pa.C.S.[A.]
§ 1798 because [Attorney Trotman] pursued the first-party
benefits claim on a contingency fee basis[,] and the statute
precludes an award of attorney’s fees in this context[,] and
because the trial court otherwise misapplied § 1798 in
awarding fees on this record, where [Jackson’s] counsel
pursued the first-party claims for no fee?
2. Whether the trial court abused its discretion and/or committed
an error of law in awarding attorney’s fees for time incurred in
pursuing attorney’s fees because [Jackson] had no material
interest in the fee litigation?
Brief for Appellant at 4.
Our review of a trial court’s decision in a non-jury case is as follows:
[The Court is] limited to a determination of whether the findings
of the trial court are supported by competent evidence and
whether the trial court committed error in the application of law.
Findings of the trial judge in a non-jury case must be given the
same weight and effect on appeal as a verdict of a jury and will
not be disturbed on appeal absent error of law or abuse of
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discretion. When this Court reviews the findings of the trial judge,
the evidence is viewed in the light most favorable to the victorious
party below and all evidence and proper inferences favorable to
that party must be taken as true and all unfavorable inferences
rejected. “With regard to such matters, our scope of review is
plenary as it is with any review of questions of law.”
Hart v. Arnold, 884 A.2d 316, 330-31 (Pa. Super. 2005) (citations
omitted). “The [trial] court’s findings are especially binding on appeal, where
they are based upon the credibility of the witnesses, unless it appears that the
court abused its discretion[,] or that the court’s findings lack evidentiary
support[,] or that the court capriciously disbelieved the
evidence.” Id. (citations omitted). “Conclusions of law, however, are not
binding on an appellate court, whose duty it is to determine whether there
was a proper application of law to fact by the lower court.” Tagliati v.
Nationwide Ins. Co., 720 A.2d 1051, 1053 (Pa. Super. 1998).
Similarly, “[o]ur standard of review [of an order] denying a motion for
a new trial is to decide whether the trial court committed an error of law which
controlled the outcome of the case or committed an abuse of
discretion.” Angelo v. Diamontoni, 871 A.2d 1276, 1279 (Pa. Super. 2005).
At issue is the trial court’s interpretation and application of a statute, 75
Pa.C.S.A. § 1798(a) and (b). When interpreting legislative enactments, we
are guided by the Statutory Construction Act, which recognizes that “[t]he
object of all interpretation and construction of statutes is to ascertain and
effectuate the intention of the General Assembly.” 1 Pa.C.S.A. § 1921(a).
“When the words of a statute are clear and free from all ambiguity, the letter
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of it is not to be disregarded under the pretext of pursuing its spirit.” Id.
§ 1921(b). Words and phrases within a statute must be “construed according
to rules of grammar and according to their common and approved
usage,” id. § 1903(a), and must be read within the context of the remaining
statutory language. Commonwealth v. Office of Open Records, 103 A.3d
1276, 1285 (Pa. 2014). It is only when the plain language of a statute is
ambiguous that courts may resort to other tools of statutory construction in
order to ascertain the General Assembly’s intent. See 1 Pa.C.S.A. § 1921(c).
Further,
[w]henever a general provision in a statute shall be in conflict with
a special provision in the same or another statute, the two shall
be construed, if possible, so that effect may be given to both. If
the conflict between the two provisions is irreconcilable, the
special provisions shall prevail and shall be construed as an
exception to the general provision, unless the general provision
shall be enacted later and it shall be the manifest intention of the
General Assembly that such general provision shall prevail.
Id. § 1933.
Before addressing USAA’s first claim, we set forth the plain language of
the statute at issue, to assist in understanding USAA’s argument. Section
1798 provides, in relevant part, as follows:
(a) Basis for reasonable fee.—No attorney’s fee for
representing a claimant in connection with a claim for first
party benefits provided under Subchapter B (relating to
motor vehicle liability insurance first party benefits) … shall
be calculated, determined or paid on a contingent fee
basis, nor shall any attorney’s fees be deducted from the
benefits enumerated in this subsection which are otherwise
due such claimant. An attorney may charge a claimant a
reasonable fee based upon actual time expended.
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(b) Unreasonable refusal to pay benefits.—In the event an
insurer is found to have acted with no reasonable foundation
in refusing to pay the benefits enumerated in subsection (a)
when due, the insurer shall pay, in addition to the benefits
owed and the interest thereon, a reasonable attorney fee
based upon actual time expended.
75 Pa.C.S.A. § 1798(a), (b) (emphasis added).
USAA first claims that the trial court improperly awarded Jackson
attorney’s fees, because Jackson’s counsel pursued the PIP claim on a
contingency fee basis. See Brief for Appellant at 10. USAA disputes the trial
court’s determination that “[Jackson’s] counsel’s disavowment of the
existence of a contingency fee agreement suggests that no fee was
contemplated for securing [Jackson’s] PIP benefits.” Id. at 11 (citation and
internal quotation marks omitted). USAA directs our attention to the
statement by Attorney Trotman that he would receive no fee if Jackson was
able to secure her PIP benefits without filing a lawsuit. Id. at 12. According
to USAA, Attorney Trotman’s testimony “reflects a contingency fee in its
commonly used meaning.” Id. at 13.
Additionally, USAA argues that, pursuant to section 1798, any
reasonable attorney’s fee “is necessarily tied to the amount that counsel
actually charges the claimant in pursuit of first-party benefits.” Id. USAA
posits that subsections (a) and (b) are “inextricably” tied, and that “any award
amount under § 1798(b) is necessarily the same amount that would have
been charged to the claimant under § 1798(a).” Id. at 14. Because Attorney
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Trotman’s fee amount under subsection (a) is zero, USSA contends that the
zero-dollar figure must also apply with respect to any fees sought under
subsection (b). Id. at 15.
Our review of the plain language of section 1798(a) discloses that
subsection (a) refers only to the pursuit of first-party benefits under
subchapter B of the MVFRL and catastrophic loss benefits under subchapter F
of the MVFRL. 75 Pa.C.S.A. § 1798(a). The parties do not dispute that
Jackson’s PIP claim constituted a claim for the type of benefits contemplated
under subsection (a). The plain language of subsection (a) provides, in
relevant part, that “[n]o attorney’s fee … shall be calculated, determined or
paid on a contingent fee basis[.]” 75 Pa.C.S.A. § 1798(a). This Court has
defined a “contingent fee” as
an agreement express, or implied, for legal services ... under
which compensation, contingent in whole or in part upon the
successful accomplishment or disposition of the subject matter of
the agreement, is to be in an amount which either is fixed or is to
be determined under a formula....
Eckell v. Wilson, 597 A.2d 696, 699 (Pa. Super. 1991).
By contrast, section 1798(b) expressly provides for the imposition of
attorney’s fees when an insurer has acted unreasonably in refusing to pay the
benefits enumerated in section 1798(a). See 75 Pa.C.S.A. § 1798(b).
Here, the trial court found that USAA unreasonably refused to pay
Jackson the benefits enumerated under subsection (a). See Trial Court
Opinion, 10/23/19, at 10. Therefore, the trial court awarded Jackson
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attorney’s fees, as set forth in subsection (b). Id. at 6. In doing so, the trial
court found that Attorney Trotman did not have a contingent fee arrangement
with Jackson. Id. at 8-9. Specifically, the trial court relied upon the testimony
of Attorney Trotman, who stated the following:
[ATTORNEY] TROTMAN: For the record, we have no contingency
fee with [] Jackson for this particular first-party benefits matter.
The goal was to get her medical bills paid, which they have been,
or they almost are done.
* * *
THE COURT: So[,] in the event that you didn’t have to file suit in
order for [] Jackson’s PIP benefits to be paid, then you would not
have been compensated for any efforts of your office to obtain her
first-party benefits, is that correct?
[ATTORNEY] TROTMAN: Correct, Your Honor.
Trial Court Opinion, 10/23/19, at 8 (quoting N.T., 11/28/18, at 218-19). The
trial court concluded that the arrangement described by Attorney Trotman was
not a contingent fee arrangement, because no fee was contemplated for
securing Jackson’s PIP benefits. See Trial Court Opinion, 10/23/19, at 9.
Under this definition set forth in Eckell, we discern no error in the trial
court’s determination. Attorney Trotman’s compensation was not contingent
upon the successful accomplishment of the subject matter. Rather, no fee
was contemplated for successfully pursuing Jackson’s PIP claim. Upon the
successful accomplishment of the subject matter, the fee would not be in an
amount “which is either fixed or to be determined under a formula.” Id.
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However, even if an agreement for “no fee” upon the successful
accomplishment of the subject matter constituted a contingent fee
arrangement, we conclude that the trial court did not err in awarding
attorney’s fees to Attorney Trotman under subsection (b). As the United
States District Court for the Eastern District of Pennsylvania has observed,
“[e]ven though 75 [Pa.C.S.A.] § 1798(b) prohibits contingency fee
agreements, nothing in the text of the statute states that an insured forfeits
her right to recover attorney’s fees as a penalty for entering into such an
arrangement.” Platt v. Fireman’s Fund Ins. Co., 2012 U.S. Dist. LEXIS
71000, *29 (E.D. Pa. May 22, 2012). The federal district court’s reasoning is
persuasive, when viewed in light of the plain language of subsections (a) and
(b).2
Here, the trial court determined that USAA acted unreasonably
in refusing to pay Jackson’s PIP claim, an enumerated benefit in section
1798(a). Trial Court Opinion, 10/23/19, at 10. Pursuant to the plain language
of 75 Pa.C.S.A. § 1798(b), Jackson was entitled to the payment of her
attorney’s fees. See 75 Pa.C.S.A. § 1798(b). Consequently, we cannot grant
USAA relief on this claim.
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2 See Commonwealth v. Ragan, 743 A.2d 390, 396 (Pa. 1999) (recognizing
that the Pennsylvania Supreme Court “is not bound by decisions of the federal
courts inferior to the United States Supreme Court, even though we may look
to them for guidance.”).
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In its second claim, USAA argues that the trial court abused its discretion
by awarding attorney’s fees for the time incurred by Attorney Trotman in
pursuing the attorney’s fees, after the resolution of Jackson’s PIP benefits
claim. Brief for Appellant at 17. Specifically, USAA disputes the trial court’s
inclusion of the 5.6 hours in fees incurred for the preparation of the Fee
Petition by Attorney Trotman. Id. In particular, USAA distinguishes the case
relied upon by the trial court, Richards v. Ameriprise Fin., Inc., 217 A.3d
854 (Pa. Super. 2019), as that case involved a petition for fees under the
Unfair Trade Practice and Consumer Protection Law (“UTPCPL”). Brief for
Appellant at 17-18. According to USAA, the Richards case is distinguishable
because the UTPCPL “limits the recovery of fees to actual time spent for
representing a claimant in connection with a claim for first[-]party benefits.”
Id.Further, USAA contends that the case upon which the Richards Court
relied, Birth Ctr. v. St. Paul Cos., 727 A.2d 1144 (Pa. Super. 1999), provided
that “fee recovery may include the reasonable fees incurred in preparation
and litigation of the fee petition[,] if the client retains a material interest in
the fee litigation.” Brief for Appellant at 18 (emphasis omitted) (quoting Birth
Ctr., 727 A.2d at 1161). USAA argues that Jackson had no further material
interest in the fee litigation, as Attorney Trotman had secured the payment of
Jackson’s PIP claim before trial. Id. at 21. Therefore, USAA claims, the award
of attorney’s fees should not have included the time spent solely in pursuit of
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attorney’s fees, and, at a minimum, should exclude the time expended “from
September 14, 2018, through January 7, 2019, totaling 39.6 hours—exclusive
of the 5.6 hours discussed above and associated with the drafting of the [F]ee
[P]etition.” Id. at 20.
“Appellate review of an order of a tribunal awarding counsel fees to a
litigant is limited solely to determining whether the tribunal palpably abused
its discretion in making the fee award.” Braun v. Wal-Mart Stores, Inc.,
24 A.3d 875, 974 (Pa. Super. 2011).
As this Court has explained,
where counsel fees are statutorily authorized in order to promote
the purposes of a particular legislative scheme, the trial court
should not determine the appropriateness of counsel fees under
the general standards applicable in all litigation. Rather, it should
consider whether an award of fees would, in the circumstances of
the particular case under consideration, promote the purposes of
the specific statute involved.
Krebs v. United Refining Co. of Pa., 893 A.2d 776, 788 (Pa. Super.
2006) (quoting Krassnoski v. Rosey, 684 A.2d 635, 639 (Pa. Super. 1996)).
Contrary to USAA’s argument, the relevant consideration for the trial
court is not whether Jackson continued to have a “material interest” in the
proceedings, but whether the award of fees “would, in the circumstances of
the particular case under consideration, promote the purposes of the specific
statute involved.” Krebs, 893 A.2d at 788. As subsection (b), by its
language, seeks to deter the unreasonable denial of claims by the insurer, an
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award of fees for preparing the Fee Petition promotes the specific purposes of
the statute involved. See Krebbs, supra.
In its Opinion, the trial court explained its award as follows:
“There is a dearth of Pennsylvania authority addressing the
propriety of a fee award for hours spent preparing and litigating
fee petitions.” Richards v. Ameriprise Fin., Inc., [217 A.3d at
871]. [The] Superior Court acknowledged that “the federal courts
generally permit such fees, but [that] the hours assigned to that
task must be reasonable.” Id. “Determining the reasonable
amount of time to prepare a fee petition is inherently an inexact
science.” [Id. at 871] (citing Johnson v. G.D.F., Inc., 2014 U.S.
Dist. LEXIS 14446, *31 (N.D. Ill. 2014)).
The Fee Petition includes four entries that post-date the
[t]rial [c]ourt’s Findings of Fact and Conclusions of Law. The four
entries, one dated December 18, 2019, two dated January 3,
2019[,] and one dated January 7, 2019[,] are for work related to
reviewing the [t]rial [c]ourt’s [O]rders and drafting the Fee
Petition[,] for a total of 5.6 hours.
The [t]rial [c]ourt ordered [Attorney Trotman] to submit a
Fee Petition, which included the following time spent after the PIP
claim was paid:
 0.1 hours reviewing two [t]rial [c]ourt [O]rders;
 1.1 hours drafting the Fee Petition;
 1.3 hours to continue drafting the Fee Petition; [and]
 3.1 hours drafting, reviewing, editing and filing the Fee
Petition.
The time [that Attorney Trotman] spent reviewing the [t]rial
[c]ourt’s [O]rders and drafting the Fee Petition was not excessive
and was reasonably included in the 139.4 hours awarded. The
[t]rial [c]ourt awarded reasonable attorney fees based on time
expended to secure [Jackson’s] PIP claim, which included time
spent reviewing the [t]rial [c]ourt’s [O]rders and drafting the Fee
Petition.
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Trial Court Opinion, 10/23/19, at 13-14. As we discern no abuse of discretion
by the trial court in its calculation and award of attorney’s fees, we cannot
grant USAA relief on this claim.
Judgment affirmed.
Judgment Entered.
Joseph D. Seletyn, Esq.
Prothonotary
Date: 4/30/20
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