Bennie Sisto, as the Trustee of Goat Island Realty Trust v. America Condominium Association, Inc. , 140 A.3d 124 ( 2016 )

Supreme Court
No. 2015-181-Appeal.
(NC 08-119)
Bennie Sisto, as the Trustee of Goat Island :
Realty Trust
v. :
America Condominium Association, Inc., :
et al.
NOTICE: This opinion is subject to formal revision before
publication in the Rhode Island Reporter. Readers are requested to
notify the Opinion Analyst, Supreme Court of Rhode Island,
250 Benefit Street, Providence, Rhode Island 02903, at Telephone
222-3258 of any typographical or other formal errors in order that
corrections may be made before the opinion is published.
Supreme Court
No. 2015-181-Appeal.
(NC 08-119)
(Dissent begins on page 9)
Bennie Sisto, as the Trustee of Goat Island :
Realty Trust
v. :
America Condominium Association, Inc., :
et al.
Present: Goldberg, Flaherty, Robinson, and Indeglia, JJ.
OPINION
Justice Indeglia, for the Court. The saga continues between the plaintiff, Bennie Sisto
(Sisto or plaintiff), and the defendants, America Condominium Association, Inc., and the
members of its executive board, (collectively, defendants). This time, the plaintiff appeals the
Superior Court’s award of $8,924.60 to the defendants for their attorney’s fees incurred in
defending the plaintiff’s claim on appeal pursuant to Rhode Island’s strategic lawsuit against
public participation (anti-SLAPP) statute, G.L. 1956 chapter 33 of title 9. This matter came
before the Supreme Court on February 25, 2016, pursuant to an order directing the parties to
appear and show cause why the issues raised should not be summarily decided. After hearing
the arguments of counsel and reviewing the memoranda submitted on behalf of the parties, we
are satisfied that cause has not been shown. Accordingly, we shall decide the matters at this time
without further briefing or argument. For the reasons set forth herein, we affirm the judgment of
the Superior Court.
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I
Facts and Travel
Setting the various nuances and nitty-gritty details of this seemingly never-ending case
aside, the facts essential to the instant appeal are as follows. 1 The plaintiff owns a condominium
unit within the Goat Island South (GIS) condominium community. In 2006, he filed an
application with the Coastal Resources Management Council (CRMC) seeking to expand his
unit. The defendants filed an objection to his proposal, asserting, inter alia, that plaintiff did not
own the property upon which he sought to expand his unit and that his proposal failed to comply
with certain CRMC requirements. As a result of this objection and other correspondence with
defendants, the CRMC questioned whether plaintiff owned the land he sought to expand upon
and denied his application.
In March 2008, plaintiff took his grievances to the courthouse and filed a complaint in
Newport County Superior Court alleging slander of title and breach of contract and seeking a
declaratory judgment that he had the right to file an application with the CRMC to expand his
unit. Not to be outdone, defendants moved for partial summary judgment, arguing that our anti-
SLAPP statute protected them from any liability for questioning plaintiff’s ownership of the land
in their communications with the CRMC. The trial justice granted defendants’ partial summary
judgment motion; and, in accordance with § 9-33-2(d) of the anti-SLAPP statute, awarded
defendants $9,685.31 in attorney’s fees. The plaintiff appealed to this Court, and we affirmed
the Superior Court’s grant of the partial summary judgment motion in favor of defendants on the
1
For a full recitation of the facts surrounding this ten-year odyssey, we refer the reader to our
opinion in Sisto v. America Condominium Association, Inc., 68 A.3d 603 (R.I. 2013).
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anti-SLAPP claim. 2 Sisto v. America Condominium Association, Inc., 68 A.3d 603, 617 (R.I.
2013). Following that opinion, defendants filed an amended motion for an assessment of
attorney’s fees in Superior Court seeking to recover $29,748.65 incurred in defending the anti-
SLAPP judgment on appeal. 3
In that proceeding, the hearing justice first issued a decision in which he determined that
the Superior Court had subject matter jurisdiction to hear defendants’ motion, rejecting
plaintiff’s myriad contentions to the contrary. The hearing justice then issued a subsequent
decision awarding defendants $8,924.60 in attorney’s fees in connection with the appeal. Final
judgment was entered on April 30, 2015. The plaintiff filed a timely appeal. 4
II
Issues on Appeal
On appeal, plaintiff argues that the hearing justice erred when he determined that the
Superior Court had subject matter jurisdiction over defendants’ motion for assessment for
attorney’s fees. He also posits that the fees awarded to defendants were unreasonable. We
discuss the specifics of his quarrels below.
2
We also concluded that the Rhode Island Condominium Act, G.L. 1956 chapter 36.1 of title 34,
required plaintiff to obtain unanimous consent from the other 153 unit owners in the Goat Island
Community to expand his townhouse on to the shared land. Sisto, 68 A.3d at 614.
3
The defendants’ original motion sought attorney’s fees in the amount of $152,122.55. The
motion was amended to “eliminat[e] fees mistakenly included in the original motion” and sought
a total of $39,433.96, which included the outstanding $9,685.31 in attorney’s fees that were
previously awarded by the Superior Court.
4
According to defendants, shortly after plaintiff filed the instant notice of appeal, defendants
received a check from plaintiff in the amount of $8,924.60 along with a memorandum which
stated that plaintiff was making payment “without prejudice and with full reservation of rights.”
From what we can discern from the record and the parties’ prebriefing statements, the previous
award of $9,685.31 remains unpaid.
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III
Discussion
To begin, we sketch a brief overview of attorney’s fees as they relate to the anti-SLAPP
statute. Section 9-33-2(d) provides: “If the court grants the motion asserting the immunity
established by this section, * * * the court shall award the prevailing party costs and reasonable
attorney’s fees, including those incurred for the motion and any related discovery matters.”
(Emphasis added.) Thus, in Alves v. Hometown Newspapers, Inc., 857 A.2d 743, 757 (R.I.
2004), we held that when a party prevails under the anti-SLAPP statute, “an award of costs and
reasonable attorneys’ fees [is] mandatory.” We have also stated that the statutorily mandated
fees include those in connection with an appeal “for the defense of [such] judgment.” Karousos
v. Pardee, 992 A.2d 263, 273 (R.I. 2010). This statutory authority results in a deviation from our
otherwise “staunch adherence to the ‘American rule’ that requires each litigant to pay its own
attorney’s fees * * *.” Moore v. Ballard, 914 A.2d 487, 489 (R.I. 2007) (citing Eleazer v. Ted
Reed Thermal, Inc., 576 A.2d 1217, 1221 (R.I. 1990)).
The plaintiff does not dispute that defendants “prevailed” under the anti-SLAPP statute,
both in the Superior Court and on appeal. Thus, under our case law, an award of reasonable
attorney’s fees in defendants’ favor—including those incurred in connection with defending the
judgment on appeal—is mandatory. The plaintiff nevertheless attacks the award both as to its
propriety and reasonableness.
A. Propriety of the Award of Attorney’s Fees
Whether the issue of attorney’s fees was properly before the Superior Court is a threshold
matter in this appeal, so we address this issue first.
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i. The Mandate Rule
The plaintiff’s most tenable argument is that the Superior Court improperly deviated from
our mandate in Sisto, 68 A.3d at 617, by awarding defendants attorney’s fees because the
mandate provided no such direction.
“The ‘mandate rule’ can be summarized as follows:
‘When a case has been once decided by this court on appeal, and remanded to the
[Superior Court], whatever was before this court, and disposed of by its decree, is
considered as finally settled. The [Superior Court] is bound by the decree as the
law of the case, and must carry it into execution according to the mandate. That
court cannot vary it, or examine it for any other purpose than execution; or give
any other or further relief; or review it, even for apparent error, upon any matter
decided on appeal; or intermeddle with it, further than to settle so much as has
been remanded. * * * But the [Superior Court] may consider and decide any
matters left open by the mandate of this court.’” Pleasant Management, LLC v.
Carrasco, 960 A.2d 216, 223 (R.I. 2008) (quoting United States v. Thrasher, 483
F.3d 977, 981 (9th Cir. 2007)).
Our mandate in Sisto, 68 A.3d at 617, stated, in relevant part, “we affirm the judgment of
the Superior Court * * * with respect to Sisto’s standing to file the application for expansion with
the CRMC, as well as with respect to the anti-SLAPP issue. * * * The papers may be remanded
to the Superior Court.” The mandate makes no mention of attorney’s fees in connection with
that appeal because that issue was not before us. Nevertheless, the fact that we did not explicitly
mention attorney’s fees in the mandate did not preclude the Superior Court from subsequently
awarding defendants attorney’s fees incurred in defending the judgment on appeal. See Perkins
v. Standard Oil Co. of California, 399 U.S. 222, 223 (1970). Indeed, the assessment of
attorney’s fees is best handled by the Superior Court. See Keystone Elevator Co. v. Johnson &
Wales University, 850 A.2d 912, 920 (R.I. 2004) (noting that “[t]he trial justice is in the unique
position of observing the attorneys requesting the fees and is better able to judge the merits of a
particular request.”). Because it was silent with regard to attorney’s fees—which, we reiterate,
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are mandatory under § 9-33-2(d)—our mandate left the determination of the proper award of fees
to the Superior Court. See Perkins, 399 U.S. at 223. Therefore, the Superior Court did not vary
from our mandate when it considered defendants’ motion for appellate attorney’s fees. 5
ii. Res Judicata
Battling on, plaintiff also argues that the doctrine of res judicata barred the Superior
Court from entertaining defendants’ motion for attorney’s fees. However, res judicata is not
applicable to the case at hand because that doctrine bars the relitigation of issues in a second
cause of action. Torrado Architects v. Rhode Island Department of Human Services, 102 A.3d
655, 658 (R.I. 2014). Here, no second cause of action has been filed. Rather, the original cause
of action remains ongoing. Thus, the doctrine of res judicata is inapposite. 6
B. Reasonableness of the Fees
The plaintiff next argues that the Superior Court erroneously awarded defendants
attorney’s fees because they failed to submit sufficient documentation to substantiate their
request. Specifically, he contends that the records submitted by defendants did not identify the
hours expended on the anti-SLAPP claim versus the other issues on appeal and may have been
duplicative. Thus, plaintiff contends that the hearing justice abused his discretion by arbitrarily
awarding defendants $8,924.60 in fees.
5
This line of reasoning also effectively disposes of plaintiff’s contention that defendants’ failure
to explicitly request an award of fees from this Court prevented the Superior Court from
awarding them. Furthermore, while the better practice may have been to request the fees in their
initial appeal, plaintiff does not point to any statutory or common law rule that requires it.
6
In a last-ditch effort, plaintiff argues that defendants cannot recover attorney’s fees because
they did not actually pay the fees; rather, their insurance company did. However, there is no
requirement that a prevailing party pay its fees out of pocket in order to recover, and, at oral
argument, defendants’ counsel represented that all but approximately $1,000 of the fee award
would be recouped by their insurance company, presumably pursuant to a subrogation
agreement.
-6-
This Court reviews an award of attorney’s fees for an abuse of discretion. Pearson v.
Pearson, 11 A.3d 103, 108 (R.I. 2011) (citing Blue Cross & Blue Shield of Rhode Island v.
Najarian, 911 A.2d 706, 709 (R.I. 2006)). “It is well within the authority of the trial justice to
make an attorneys’ fee award determination after considering the circumstances of the case.”
Keystone Elevator Co. v. Johnson & Wales University, 850 A.2d 912, 920 (R.I. 2004) (citing
Schroff, Inc. v. Taylor-Peterson, 732 A.2d 719, 721 (R.I. 1999)). After reviewing the record and
the hearing justice’s decision, we conclude that he did not abuse his discretion when he awarded
attorney’s fees to defendants in connection with their appeal. The hearing justice carefully
considered the circumstances surrounding this unique and drawn-out case. He conducted an in
camera review of the invoices submitted with defendants’ motion and calculated a fee in light of
what he had before him.
In determining the “lodestar,” 7 the hearing justice first reduced defendants’ request of
$29,748.65 by 75 percent to more accurately reflect the time spent on the “tangentially-related”
anti-SLAPP claim and eliminate time that may have been spent on the other issues that were on
appeal. While an across-the-board reduction is certainly not the most precise method for
7
The “lodestar” is the starting point for determining the reasonableness of attorney’s fees and is
“the number of hours reasonably expended on the litigation multiplied by a reasonable hourly
rate.” Matter of Schiff, 684 A.2d 1126, 1131 (R.I. 1996) (quoting Pontarelli v. Stone, 781 F.
Supp. 114, 120 (D.R.I. 1992) and Hensley v. Eckerhart, 461 U.S. 424, 433 (1983)). Since our
opinion in Colonial Plumbing & Heating Supply Co. v. Contemporary Construction Co., 464
A.2d 741, 744 (R.I. 1983), “affidavits or expert testimony establishing the criteria on which a fee
award is to be based” have been required. Furthermore, we note that our recent opinion in Tri-
Town Construction Co. v. Commerce Park Associates 12 LLC, Nos. 2015-22-A & 2015-146-A,
slip. op. at 18 (R.I., filed June 22, 2016) held that such affidavits or testimony must be submitted
by independent counsel who are “not representing the parties to the action in which fees are
sought.” In that case, however, the propriety of the affidavit completed by the party seeking
attorney’s fees—which was indeed completed by the party’s own attorney—was specifically
challenged. Our holding in that case did not extend to the scenario in which neither the
reasonableness of the fees nor the propriety of the affidavit submitted by the party seeking fees is
challenged, as was the case here.
-7-
calculating an award of attorney’s fees, the hearing justice was forced to make do with what he
had—which were billing records that, in his words, “d[id] not even begin to approach a diligent
accounting of the hours spent on the anti-SLAPP appeal” and from which he could not
“distinguish work performed on anti-SLAPP issues [from] time dedicated to other matters.”
Sisto v. America Condominium Association, Inc., 2015 WL1620069 * 3 (R.I. Super. April 8,
2015). In view of the records submitted by defendants, we cannot say that the trial justice
abused his discretion in making this reduction. See Codex Corp. v. Milgo Electronic Corp., 717
F.2d 622, 632 (1st Cir. 1983) (holding that it was not an abuse of discretion for the district court
to reduce an award of attorney’s fees where the submissions were “inadequate”); see also Role
Models America, Inc. v. Brownlee, 353 F.3d 962, 973 (D.C. Cir. 2004) (allowing reimbursement
for only 50 percent of attorney’s fees in light of the party’s “inadequate documentation, failure to
justify the number of hours sought, inconsistencies, and improper billing entries”).
The hearing justice then increased the already-reduced fee by 5 percent based on the
complexity of the anti-SLAPP claim (relying largely on the fact that there was a dissent in Sisto
as to that issue) to reach a final award of $8,924.60. We see no abuse of discretion with this
determination, either. See Cohen v. West Haven Board of Police Commissioners, 638 F.2d 496,
505 (2d Cir. 1980) (“the court may adjust the lodestar figure upward or downward to take
account of such factors as the * * * complexity of the litigation”).
Given the record he was presented with and the protracted nature of this case, it is our
opinion that the hearing justice issued a particularly comprehensive and well-thought-out
thirteen-page decision explaining his case-specific reasoning for arriving at his final award of
attorney’s fees. As such, we cannot say he abused his discretion in doing so. However, we must
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caution that, in the future, we will require more meticulous recordkeeping by attorneys seeking
an award of fees—our tolerance today is limited to the circumstances of this case.
IV
Conclusion
For the aforementioned reasons, we affirm the judgment of the Superior Court. The
papers in this case shall be returned to that court.
Chief Justice Suttell did not participate.
Justice Goldberg, dissenting. I respectfully dissent. This is chapter two of what I
consider to be an abuse of a citizen’s right to access our courts, particularly the Supreme Court.
After this Court’s decision in the underlying case, Sisto v. America Condominium Association,
Inc., 68 A.3d 603 (R.I. 2013) (Sisto I), the emboldened defendants submitted a request for
attorney’s fees to the Superior Court for a whopping $152,122.55. No explanation has been
provided for this exorbitant request that subsequently was reduced to $29,748.65, again without
explication. No contemporaneous billing records reflecting the actual time spent on this discrete
issue exist. No disinterested attorney testified by affidavit that the submission was, in his or her
opinion, a reasonable attorney’s fee request. Indeed, the only attorney who so opined was the
attorney requesting the fee, a circumstance overlooked by the trial justice. Cf. Colonial
Plumbing & Heating Supply Co. v. Contemporary Construction Co., 464 A.2d 741, 744 (R.I.
1983) (declaring that, for the explicit purpose of providing a record upon which this Court may
review the propriety of the fee award, “affidavits or testimony establishing the criteria on which
a fee award is to be based should be required”); Kenney v. Hickey, 486 A.2d 1079, 1084 (R.I.
1985) (vacating fee for guardian ad litem based on the failure of the Family Court to follow the
majority rule set forth in Colonial Plumbing, 464 A.2d at 744, and requiring expert testimony on
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the question of the reasonableness of an award of attorney’s fees). In Sisto I, the defendants’
Supreme Court brief for the anti-SLAPP issue consists of a scant nine pages and does not
concern a novel or difficult issue of law.
In this case, it was impossible for the trial court, or anyone else for that matter, to
determine the lodestar for this extraordinary demand. It is well settled that “[t]he starting point
or ‘lodestar’ for determining the reasonableness of a fee is ‘the number of hours reasonably
expended on the litigation multiplied by a reasonable hourly rate.’” In re Schiff, 684 A.2d 1126,
1131 (R.I. 1996) (quoting Pontarelli v. Stone, 781 F. Supp. 114, 120 (D.R.I. 1992) (attached as
an appendix to In re Schiff) and Hensley v. Eckerhart, 461 U.S. 424, 433 (1983)). This is the
guiding light for fee-shifting jurisprudence. Its absence in this case was excused by the trial
justice and, sadly, again by this Court. Indeed, the trial justice found that “[t]he billing records
here do not even begin to approach a diligent accounting of the hours spent on the anti-SLAPP
appeal.” The trial justice declared that he could not,
“by review of these records, both redacted and unredacted,
distinguish between work performed on anti-SLAPP issues and
that time dedicated to other matters. * * * For example, it is
impossible to determine how the seven hours spent ‘draft[ing the]
appellate brief’ on November 1, 2012 was divided between the two
issues.”
The trial justice also lamented that there was only vague mention of correspondences
with clients, appellate strategy, oral-argument preparation, and brief drafting in the billing
records. The submission included fees for “countless phone conversations regarding the ‘status
of [the] appeal’ with each individual board member” that the trial justice found to “provide little
insight to the [c]ourt as to whether such phone calls were necessary or simply duplicative.”
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Further, “there was no attempt to abate billing entries that encompassed both fee-eligible and
non-fee-eligible work.” In the face of these glaring deficiencies, the fee request should have
been denied, and this Court should so hold.
Additionally, the trial justice found that the fee request included work done on the
declaratory-judgment appeal—which is forbidden—and he rejected counsel’s affidavit testimony
that the requested fees did not include matters that were exclusively related to the declaratory-
judgment action.
In my opinion, these damning findings should have ended this unfortunate episode, and
the request for fees should have been denied. And this Court should so hold. The trial justice,
however, proceeded to attempt to “separate the wheat from the chaff in calculating a reasonable
award.” Rather than carefully sifting through these unpalatable ingredients, he simply performed
a mathematical exercise and culled out 70 percent of the request. 8 The trial justice failed to set
forth his reasoning for awarding 30 percent of the request in the face of what the trial justice
acknowledged was inadequate documentation, a failure to justify the number of hours sought,
inconsistencies, and improper billing entries. In my opinion, this is an abuse of discretion and an
unjust result. The trial justice, on the basis of the request and the affidavit of counsel, should
have concluded, as do I, that this request shocks the conscience of the Court to such a degree that
fees should be denied. See Schiff, 684 A.2d at 1136.
Finally, I pause to note that this is not the only decision this term by this Court
concerning an award of award attorney’s fees. In Tri-Town Construction Co. v. Commerce Park
8
The trial justice first reduced the fee by 75 percent “to account for the relative apportionment
between the reasonable time necessary to prepare the anti-SLAPP and declaratory[-]judgment
matters” and then “increase[d] the already-reduced fee award by [five percent] to reach a lodestar
of $8[,]924.60”—resulting in an award of 30 percent of the amount most recently requested.
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Associates 12, LLC, No. 2015-22-A, No. 2015-146-A, slip op. at 18-19 (R.I., filed June 22,
2016), this Court reiterated the mandatory nature of our holding in Colonial Plumbing—that
affidavits or testimony of expert witnesses “must be from counsel who is a member of the Rhode
Island Bar and who is not representing the parties to the action in which fees are sought.” Tri-
Town Construction Co., slip op. at 18. Although this precise challenge was not made in the case
before us, the record before this Court, in my opinion, is replete with such shockingly egregious
deficiencies that the award constitutes an abuse of discretion. In Tri-Town Construction Co., we
unequivocally rejected the use of “affidavits and documents provided to the court by interested
parties.” Id. at 19. We also held that, “[a]lthough the standard of review of an order awarding
attorney’s fees is [an] abuse of discretion, we are of the opinion that this discretion can only be
exercised after competent evidence from independent counsel has been admitted.” Id. at 18-19
(emphasis added). In the case before us, we are doing just that—declaring that the trial justice
did not abuse his discretion based on “the record he was presented with and the protracted nature
of this case.” This is error. This error is compounded by our further justification that, “in the
future, we will require more meticulous recordkeeping by attorneys seeking an award of fees—
our tolerance today is limited to the circumstances of this case.” I am not on board.
The Denial of Access to the Courts
My second concern in this case echoes that of my original dissent: that admittedly false
letters sent to the Coastal Resources Management Council by counsel for the defendants and by
an individual board member, declaring that Sisto did not own the property upon which he sought
to expand his unit, were not “directed at petition or free speech,” a required finding to trigger the
anti-SLAPP protections of the statute. G.L. 1956 § 9-33-2(a). Although the plaintiff had every
right to appeal from the original finding that his complaint violated the anti-SLAPP statute and
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certainly presented this Court with a justiciable controversy, he did so at the risk of an additional
adverse attorney’s fee award—that is more than the original attorney’s fee. This is unjust. The
result today is emblematic of the very harm I alluded to in my dissenting opinion in Sisto I, 68
A.3d at 618, 620: the denial of access to our courts. It is the responsibility of this Court to guard
against infringement of the rights of citizens to turn to the judiciary for resolution of their
disputes. This is the essence of petitioning activity that ought to be paramount in this case.
Consequently, I respectfully dissent.
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RHODE ISLAND SUPREME COURT CLERK’S
OFFICE
Clerk’s Office Order/Opinion Cover Sheet
TITLE OF CASE: Bennie Sisto, as the Trustee of Goat Island Realty Trust v.
America Condominium Association, Inc., et al.
CASE NO: No. 2015-181-Appeal.
(NC 08-1119)
COURT: Supreme Court
DATE OPINION FILED: June 29, 2016
JUSTICES: Suttell, C.J., Goldberg, Flaherty, Robinson, and Indeglia, JJ.
WRITTEN BY: Associate Justice Gilbert V. Indeglia
SOURCE OF APPEAL: Newport County Superior Court
JUDGE FROM LOWER COURT:
Associate Justice Edward C. Clifton
ATTORNEYS ON APPEAL:
For Plaintiff: Robert D. Wieck, Esq.
For Defendants: Robert C. Shindell, Esq.
C. Alexander Chiulli, Esq.
Edmund A. Allcock, Esq.