In its most recent batch of opinions, the North Carolina Court of Appeals reminded the bar once again what must be included in a trial court order awarding attorneys’ fees.
In Brown’s Builders Supply v. Johnson, the defendants appealed a judgment awarding damages and attorneys’ fees. While the Court of Appeals rejected their other arguments, the defendants successfully argued that the trial court abused its discretion in awarding attorney’s fees because the record lacked sufficient findings to support the award.
On this point, the Court of Appeals noted that when only “reasonable” attorneys’ fees are authorized by statute, “an award of attorneys’ fees is only appropriate where the trial court makes ‘findings of fact as to the time and labor expended, the skill required, the customary fee for like work, and the experience or ability of the attorney.” (Citing N.C. Dep’t of Corr. v. Myers, 120 N.C. App. 437, 442, 462 S.E.2d 824, 828 (1995), aff’d per curiam, 344 N.C. 626, 476 S.E.2d 364 (1996); Cobb v. Cobb, 79 N.C. App. 592, 595-96, 339 S.E.2d 825, 828 (1986)). The absence of these findings makes it impossible for an appellate court to assess whether the trial court abused its discretion. (Citing Williamson v. Williamson, 140 N.C. App. 362, 365, 536 S.E.2d 337, 339 (2000)).
In the Johnson order, the trial court made findings regarding the amount of time the plaintiff’s attorney and paralegal had expended. The trial court then found that reasonable attorneys’ fees would be one third of the damages award and awarded the plaintiff attorneys’ fees in that amount. However, the trial court did not make findings regarding: “(1) the skill required to provide the services rendered; (2) the customary rate for similar work in the area; or (3) the experience or ability of Plaintiff’s attorney.” While the Court of Appeals agreed that evidence of those missing facts was in the record, the failure to include this information in the order itself was reversible error. The Court remanded the matter to the trial court for further findings on these points, stating: “On remand, the trial court may but is not required to award attorneys’ fees provided it determines that the evidence in support of the necessary findings is competent and the court makes those findings, as required.”
Going forward, it is quite possible that the trial court will make the necessary findings in a new order awarding attorneys’ fees. However, that order will then be subject to a whole new appeal, which carries additional fees and which could easily consume any funds eventually received pursuant to the order. A good takeaway message for practitioners is that when preparing draft orders awarding attorneys’ fees, it is important to make sure to include findings regarding not only the time and labor expended but also the skill required, the customary fee for like work, and the experience or ability of the attorney.