Filed: Mar. 14, 2016
Latest Update: Mar. 02, 2020
Summary: 15-1808 Exec. Risk Indem., Inc. v. Fieldbridge Assocs. LLC UNITED STATES COURT OF APPEALS FOR THE SECOND CIRCUIT SUMMARY ORDER RULINGS BY SUMMARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT. CITATION TO A SUMMARY ORDER FILED ON OR AFTER JANUARY 1, 2007, IS PERMITTED AND IS GOVERNED BY FEDERAL RULE OF APPELLATE PROCEDURE 32.1 AND THIS COURT’S LOCAL RULE 32.1.1. WHEN CITING A SUMMARY ORDER IN A DOCUMENT FILED WITH THIS COURT, A PARTY MUST CITE EITHER THE FEDERAL APPENDIX OR AN ELECTRONIC DATABASE (WITH
Summary: 15-1808 Exec. Risk Indem., Inc. v. Fieldbridge Assocs. LLC UNITED STATES COURT OF APPEALS FOR THE SECOND CIRCUIT SUMMARY ORDER RULINGS BY SUMMARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT. CITATION TO A SUMMARY ORDER FILED ON OR AFTER JANUARY 1, 2007, IS PERMITTED AND IS GOVERNED BY FEDERAL RULE OF APPELLATE PROCEDURE 32.1 AND THIS COURT’S LOCAL RULE 32.1.1. WHEN CITING A SUMMARY ORDER IN A DOCUMENT FILED WITH THIS COURT, A PARTY MUST CITE EITHER THE FEDERAL APPENDIX OR AN ELECTRONIC DATABASE (WITH T..
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15-1808
Exec. Risk Indem., Inc. v. Fieldbridge Assocs. LLC
UNITED STATES COURT OF APPEALS
FOR THE SECOND CIRCUIT
SUMMARY ORDER
RULINGS BY SUMMARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT. CITATION TO A SUMMARY ORDER FILED
ON OR AFTER JANUARY 1, 2007, IS PERMITTED AND IS GOVERNED BY FEDERAL RULE OF APPELLATE
PROCEDURE 32.1 AND THIS COURT’S LOCAL RULE 32.1.1. WHEN CITING A SUMMARY ORDER IN A
DOCUMENT FILED WITH THIS COURT, A PARTY MUST CITE EITHER THE FEDERAL APPENDIX OR AN
ELECTRONIC DATABASE (WITH THE NOTATION “SUMMARY ORDER”). A PARTY CITING A SUMMARY ORDER MUST
SERVE A COPY OF IT ON ANY PARTY NOT REPRESENTED BY COUNSEL.
1 At a stated term of the United States Court of Appeals
2 for the Second Circuit, held at the Thurgood Marshall United
3 States Courthouse, 40 Foley Square, in the City of New York,
4 on the 14th day of March, two thousand sixteen.
5
6 PRESENT: DENNIS JACOBS,
7 DENNY CHIN,
8 CHRISTOPHER F. DRONEY,
9 Circuit Judges.
10
11 - - - - - - - - - - - - - - - - - - - -X
12 EXECUTIVE RISK INDEMNITY, INC., as
13 subrogee of Andrews International,
14 Inc. and Copstat Security, LLC,
15 Plaintiffs-Appellants,
16
17 -v.- 15-1808
18
19 FIELDBRIDGE ASSOCIATES LLC,
20 Defendant-Appellee.1
21 - - - - - - - - - - - - - - - - - - - -X
22
1
The Clerk of the Court is directed to amend the
caption as above.
1
1 FOR APPELLANTS: Andrew I. Hamelsky, White and
2 Williams LLP, New York, New York.
3
4 FOR APPELLEE: Dara L. Rosenbaum, Rosenbaum &
5 Taylor, P.C., White Plains, New
6 York.
7
8 Appeal from two orders of the United States District
9 Court for the Southern District of New York (Fox, M.J.).
10
11 UPON DUE CONSIDERATION, IT IS HEREBY ORDERED, ADJUDGED
12 AND DECREED that the May 29, 2015, final order of the
13 district court be AFFIRMED.
14
15 Executive Risk Indemnity Inc. (“Executive Risk”) as
16 subrogee of its insureds Andrews International, Inc. and
17 Copstat Security, LLC appeals from two orders of the United
18 States District Court for the Southern District of New York
19 (Fox, M.J.).2 At issue are the amount of attorneys’ fees
20 expended by Executive Risk in the defense of the underlying
21 tort litigation, and whether Executive Risk can recover fees
22 incurred in this subrogation action. We assume the parties’
23 familiarity with the underlying facts, the procedural
24 history, and the issues presented for review.
25
26 1. The district court declined to award attorneys’
27 fees for work performed in the underlying tort action by any
28 person other than the main partner, Barry Jacobs. Under New
29 York law, “[a]n award of attorneys’ fees pursuant to [] a
30 contractual provision may only be enforced to the extent
31 that the amount is reasonable and warranted for the services
32 actually rendered.” Kamco Supply Corp. v. Annex Contracting
33 Inc., 689 N.Y.S.2d 189, 190 (App. Div. 1999) (citing, e.g.,
34 In re First Nat’l Bank of E. Islip v. Brower,
368 N.E.2d
35 1240 (N.Y. 1977)); see also F.H. Krear & Co. v. Nineteen
36 Named Trustees,
810 F.2d 1250, 1263 (2d Cir. 1987) (fees
37 awarded pursuant to contract must be “not unreasonable”).
38 “A variety of factors informs the court’s determination of
39 whether a requested amount of attorneys’ fees is reasonable
2
We have appellate jurisdiction even though the
district court did not enter a separate final judgment
because the May 29, 2015, order “clearly represents a final
decision and the appellees do not object to the taking of an
appeal.” Selletti v. Carey, 173 F.3d 104, 109-10 (2d Cir.
1999).
2
1 or unreasonable, including ‘the difficulty of the questions
2 involved; the skill required to handle the problem; the time
3 and labor required; the lawyer’s experience, ability and
4 reputation; the customary fee charged by the Bar for similar
5 services; and the amount involved.’” F.H. Krear, 810 F.2d
6 at 1263 (quoting In re Estate of Schaich,
391 N.Y.S.2d 135,
7 136 (App. Div. 1977)). With the exception of Mr. Jacobs,
8 Executive Risk failed to provide the district court with
9 sufficient information as to one factor that bears on
10 reasonableness: the lawyer’s experience, ability and
11 reputation. New York courts put the burden of establishing
12 fees’ reasonableness on the party seeking fees. See, e.g.,
13 Potts v. Hines,
534 N.Y.S.2d 507, 508 (App. Div. 1988);
14 Marine Midland Bank v. Roberts,
424 N.Y.S.2d 671, 673 (Civ.
15 Ct. 1980). Since Executive Risk did not carry that burden,
16 the court did not abuse its discretion in determining that
17 it could not find the requested fees of lawyers (and
18 paralegals) other than Mr. Jacobs to be reasonable and
19 declining to award any fees for their services. See
20 SO/Bluestar, LLC v. Canarsie Hotel Corp.,
825 N.Y.S.2d 80,
21 82 (App. Div. 2006) (reversing award of attorneys’ fees
22 where the trial court did not “possess sufficient
23 information upon which to make an informed assessment of the
24 reasonable value of the legal services rendered” (quoting
25 Bankers Fed. Sav. Bank FSB v. Off W. Broadway Developers,
26
638 N.Y.S.2d 72, 74 (App. Div. 1996))); Potts,
534 N.Y.S.2d
27 at 508 (affirming denial of fees because former attorney
28 “failed to satisfy his burden of establishing the value of
29 the legal services performed”).
30
31 When a New York State trial court lacks sufficient
32 information from which to determine whether fees requested
33 pursuant to a contractual provision are reasonable, the
34 court must hold a hearing (or otherwise obtain additional
35 information), rather than rejecting that portion of the
36 request outright. See
SO/Bluestar, 825 N.Y.S.2d at 82;
37 Bankers
Fed., 638 N.Y.S.2d at 74-75; Cmty. Sav. Bank v.
38 Shaad,
482 N.Y.S.2d 162, 163 (App. Div. 1984). However,
39 that procedural rule does not apply in this diversity
40 action. See Gasperini v. Ctr. for Humanities,
518 U.S. 415,
41 427 (1996) (“Under the Erie doctrine, federal courts sitting
42 in diversity apply state substantive law and federal
43 procedural law.”); Pls.-Appellants’ Br. at 25 (“[U]nder New
44 York law, if the district court could not ascertain the
45 reasonable fees to be awarded after receiving Executive
46 Risk’s submission, the proper procedure was to set the
47 matter down for a hearing.” (emphasis added)). Since this
3
1 state procedural rule does not apply, acceptance of
2 additional evidentiary submissions in connection with
3 Executive Risk’s motion for reconsideration was a matter
4 within the district court’s discretion. Williams v.
5 Citigroup, Inc., 659 F.3d 208, 214 n.3 (2d Cir. 2011) (per
6 curiam). It did not abuse discretion in declining to accept
7 and consider these materials.
8
9 2. Executive Risk argues that the district court
10 erred in declining to award attorneys’ fees incurred in
11 prosecuting this subrogation action, because contemporaneous
12 time records are not required under New York law. We need
13 not decide whether Executive Risk’s submission was
14 sufficient in this respect because New York law does not
15 authorize an award of attorneys’ fees incurred in an action
16 to recover on a contract, unless provided for by the
17 contract. See Doyle v. Allstate Ins.,
136 N.E.2d 484, 487
18 (N.Y. 1956); Swiss Credit Bank v. Int’l Bank, Ltd., 200
19 N.Y.S.2d 828, 830-31 (Sup. Ct. 1960).3 And “[u]nder New
20 York law, ‘the court should not infer a party’s intention’
21 to provide counsel fees as damages for a breach of contract
22 ‘unless the intention to do so is unmistakably clear’ from
23 the language of the contract.” Oscar Gruss & Sons, Inc. v.
24 Hollander,
337 F.3d 186, 199 (2d Cir. 2003) (quoting Hooper
25 Assocs., Ltd. v. AGS Computs., Inc.,
548 N.E.2d 903, 905
26 (N.Y. 1989)); see also Swiss Credit
Bank, 200 N.Y.S.2d at
27 830-31 (“A general agreement for the payment of counsel fees
28 does not generally include counsel fees in the suit to
29 collect those fees.” (citing Doyle,
136 N.E.2d 484)). The
30 contract between Fieldbridge and Executive Risk’s insureds
31 does not clearly provide for recovery of attorneys’ fees
32 incurred in an action to collect on a breach of the
33 contract.
34
35
36
37
38
3
Executive Risk attempts to read Johnson v. General
Mutual Insurance Co., 246 N.E.2d 713 (N.Y. 1969), to hold
otherwise. However, the New York Court of Appeals has been
exceedingly clear that legal fees incurred in an action to
recover legal fees are noncompensable. See Chapel v.
Mitchell, 642 N.E.2d 1082, 1083-84 (N.Y. 1994) (discussing
Johnson, 246 N.E.2d 713, and Doyle,
136 N.E.2d 484).
4
1 For the foregoing reasons, and finding no merit in
2 Executive Risk’s other arguments, we hereby AFFIRM the May
3 29, 2015, final order of the district court.
4
5 FOR THE COURT:
6 CATHERINE O’HAGAN WOLFE, CLERK
7
5
