Opinion
3:19-cv-00447-AR
12-07-2022
OHIO CASUALTY INSURANCE COMPANY, a New Hampshire Corporation, Plaintiff, v. CHRIS DIALS CONTRACTING LLC, an Oregon limited liability company; CHRISTOPHER PAUL DIALS, an individual, Defendants.
FINDINGS AND RECOMMENDATION
JEFFREY ARMISTEAD, United States Magistrate Judge
Before the court is plaintiff Ohio Casualty Insurance Company's motion to lift the stay on this action and to enter judgment in accordance with the parties' settlement agreement and Confession of Judgment. Mot. to Enter Judgment, ECF No. 80. The court construes this motion as a request to enforce the parties' settlement agreement. Ohio Casualty has also submitted a Bill of Costs. ECF No. 85. Because it is undisputed that the parties entered a settlement agreement and because Ohio Casualty has presented evidence that defendants breached that agreement, Ohio Casualty's motion for entry of judgment should be granted. The court also recommends granting Ohio Casualty's Bill of Costs.
BACKGROUND
On March 27, 2019, Ohio Casualty filed this diversity action against defendants Christopher Dials and Chris Dials Contracting LLC (CDC), alleging several causes of action to recover costs associated with surety bonds that Ohio Casualty had issued on behalf of CDC. See generally, Compl., ECF No. 1; Am. Compl., ECF No. 4 (filed April 10, 2019). After several months of negotiations, the parties entered into a settlement agreement on August 23, 2021. Decl. of Jason Stonefeld ¶ 2, Ex. A, ECF No. 82. The agreement is governed by Oregon law, and both parties were represented by counsel during the settlement process. Id. at 5; see also Order Appointing Heather J. Van Meter for Christopher Paul Dials and Chris Dials Contracting, ECF No. 44 (dated November 30, 2020); Notice of Appearance, ECF No. 51.
In the settlement agreement exhibit submitted by Ohio Casualty, Mr. Dial's signature appears on a separate photocopy of the final page of the agreement. Because Mr. Dials does not challenge the authenticity of that signature or the existence and validity of the settlement agreement as a whole, the court accepts this exhibit as evidence of the parties' settlement agreement.
On October 4, 2022, Ms. Van Meter moved to withdraw as pro bono counsel for defendants, noting that her representation had concluded because “a settlement was reached, and a Confession of Judgment was entered into the Court's record on September 3, 2021.” Mot. to Withdraw, ECF No. 83. The court granted her motion on October 13, 2022. Order Terminating Pro Bono Counsel, ECF No. 84.
As part of the settlement, defendants agreed to pay Ohio Casualty a total sum of $125,000 within one year, with the first monthly installment of $5,000 due on September 1, 2021. Id. The parties also executed, notarized, and filed with the court a Confession of Judgment memorializing that obligation and providing:
If full payment is not made in accordance with the Settlement Agreement, [Defendants] agree that [Ohio Casualty] is entitled to recover the remaining balance owed of the original $125,000.00, plus reasonable attorney fees necessarily incurred in the above-captioned case and for enforcing this Confession of Judgment, as well as recoverable costs in the above-captioned case and recoverable costs for enforcing this Confession of Judgment, and interest at the rate of 9% per annum as specified above until the full sum owed under this Confession of Judgment is paid in full.
[. . .]
[Ohio Casualty] may execute upon this Confession of Judgment by filing a Declaration showing the [Defendants'] default and demonstrating any amounts owed under the terms of the Confession of Judgment.Confession of Judgment, ECF No. 76. The settlement agreement likewise authorizes Ohio Casualty to “seek past and future attorneys' fees, costs, and disbursements in enforcing and/or otherwise executing the Confession of Judgment.” Stonefeld Decl. ¶ 2, Ex. A at 4.
Ohio Casualty agreed not to enforce the Confession of Judgment if defendants complied with the terms of the settlement agreement, and this action was stayed until September 13, 2022, to allow defendants time to satisfy their obligations. Order, ECF No. 77. Defendants made monthly installment payments of $5,000 to Ohio Casualty totaling $25,000. Stonefeld Decl. ¶ 3. The last payment was received on December 10, 2021. Id. ¶ 4. On August 23, 2022, the final payment deadline passed, with $100,000 remaining due to Ohio Casualty. Id.
On September 7, 2022, Ohio Casualty sent defendants' counsel a request that defendants stipulate to a motion seeking a relief from stay and to enter judgment. Dec. of Meredith Dishaw ¶ 2, ECF No. 81. In response, Ohio Casualty received a proposal for an altered settlement agreement, but no further response regarding the requested stipulation. Ohio Casualty filed this motion to lift the stay on this action and to enter judgment against defendants on September 22, 2022. Mot. to Enter Judgment at 6. Defendants have not responded to this motion, and the time to do so has expired.
LEGAL STANDARD
A district court has the power to summarily enforce an agreement to settle a case pending before it. Callie v. Near, 829 F.2d 888, 890 (9th Cir. 1987). Summary enforcement is inappropriate, however, “where material facts concerning the existence or terms of a settlement agreement [a]re in dispute.” In re City Equities Anaheim, Ltd., 22 F.3d 954, 957 (9th Cir. 1994) (internal citations omitted). “The construction and enforcement of settlement agreements are governed by principles of local law which apply to interpretations of contracts generally.” Jeff D. v. Andrus, 899 F.2d 753, 759 (9th Cir. 1989).
Under Oregon law, the determination of whether a contract exists is a question of law. In re Marriage of Baldwin, 215 Or.App. 203, 207 (2007). “In determining whether a contract exists and what its terms are, [the court] examine[s] the parties' objective manifestations of intent, as evidenced by their communications and acts.” Ken Hood Constr. v. Pac. Coast Constr., 201 Or.App. 568, 578, adh'd to as modified on recons. by 203 Or.App. 768 (2006). Thus, the determination of whether a contract exists “does not depend on whether the parties had the same subjective understanding of their agreement . . . it depends on whether the parties agreed to the same, express terms of the agreement, and on whether those terms constitute an enforceable agreement.” City of Canby v. Rinkes, 136 Or.App. 602, 611 (1995). The parties need only agree on the essential or material elements of the contract, not on every possible term. Pacificorp v. Lakeview Power Co., 131 Or.App. 301, 307 (1994). A contractual term is material if it goes to “the substance of the contract and, if breached, defeat[s] the object of the parties in entering into the agreement.” Johnstone v. Zimmer, 191 Or.App. 26, 34 (2003).
DISCUSSION
Ohio Casualty asks the court to enforce the parties' settlement agreement by entering judgment against defendants, jointly and severally, in the amount of $155,742.79. Mot. to Enter Judgment at 6. That sum encompasses a request for: (1) $100,000 as the outstanding principle; (2) $23,964.50 in attorney fees; (3) $1,055 in litigation costs; and (4) $30,723.29 in prejudgment interest on the outstanding principle. Id.; Stonefeld Decl. ¶ 4.
This amount is derived using the lodestar calculation method.
As an initial matter, the court recommends granting Ohio Casualty's motion with respect to the $100,000 outstanding principle. It is not disputed that the parties entered a settlement agreement, which is memorialized in a written contract. Stonfeld Decl. ¶ 2, Ex. A; Mot. to Withdraw, ECF No. 83 (acknowledging settlement). Material to that settlement agreement was defendants' commitment to pay Ohio Casualty $125,000 in monthly installments and to make “[f]ull and final payment” of that sum within one year-by August 23, 2022. Stonefeld. Decl. ¶ 2, Ex. A. That deadline has lapsed, and defendants still owe $100,000 of that obligation. Id. ¶ 3. Therefore, defendants have breached a material term of the parties' settlement agreement, and the court should enter judgment against them for that outstanding obligation.
The court also recommends granting Ohio Casualty's request for attorney fees. The parties' settlement agreement and Confession of Judgment provide that, if defendants fail to satisfy their obligations in a timely manner, Ohio Casualty is entitled to reasonable attorney fees and costs. Thus, “[i]t remains for the district court to determine what fee is reasonable.” Hensley v. Eckerhart, 461 U.S. 424, 433 (1983) (internal quotation marks omitted). To determine whether a fee request is reasonable, courts within the Ninth Circuit use the “lodestar” calculation method. Camacho v. Bridgeport Fin., Inc., 523 F.3d 973, 980 (9th Cir. 2008). The calculation multiplies “the number of hours reasonably expended on the litigation . . . by a reasonable hourly rate.” Hensley, 461 U.S. at 433. The court looks to prevailing market rates to determine a reasonable hourly rate, and judges in this district evaluate fee petitions against the most recent Oregon State Bar Economic Survey (2017 OSB Survey). Blum v. Stenson, 465 U.S. 886, 895 (1984). Typically, this court limits the hourly rate requested to the 75th percentile of the 2017 OSB Survey. See, e.g., Brady Mktg. Co. Inc. v. Kai U.S.A. Ltd., Case No. 3:16-cv-1878-MO, 2018 WL 3377083, at *3 (D. Or. July 11, 2018).
The economic survey is available at: https://www.osbar.org/docs/resources/Econsurveys/17EconomicSurvey.pdf.
Once the fee applicant has submitted evidence of the hours worked and rates claimed, the party opposing the fee request “has a burden of rebuttal that requires submission of evidence to the district court challenging the accuracy and reasonableness of the hours charged or the facts asserted by the prevailing party in submitted affidavits.” Gates v. Deukmejian, 987 F.2d 1392, 1401 (9th Cir. 1993). The party opposing a fee request must meet that burden with specific objections to specific billing entries. Id. “Where the party makes only ‘a generalized objection,' courts will generally only reduce hours where the unreasonableness of the request can be identified ‘through a cursory examination of the bill.'” Nat. Res. Def. Council v. Locke, 771 F.Supp.2d 1203, 1214 (N.D. Cal. 2011) (quoting Glover v. Johnson, 138 F.3d 229, 252 (6th Cir. 1998)).
In its fee request, Ohio Casualty seeks (1) $21,120 for 76.8 hours of work performed by Meredith Dishaw at a requested hourly rate of $275; (2) $62 for 0.2 hours of work performed by Todd Blischke at a requested hourly rate of $310; (3) $2,572.50 for 10.5 hours of work performed by Christine Lee at a requested hourly rate of $245; and (4) $210 for 1.4 hours of work performed by Melissa Patton, a senior paralegal, at a requested hourly rate of $150. See Sec. Decl. of Meredith Dishaw, ECF No. 85.
Although, Ohio Casualty's billing data also reflects work performed by another paralegal, Tom Ross, Mr. Ross's time was not charged to Ohio Casualty and is not sought in this fee request. Dishaw Decl. ¶ 8, Ex. A.
Ohio Casualty has submitted timekeeping and billing documentation to support its requested hours. See id. ¶ 3, Ex. A. The requested hourly rates are supported by the experience of the attorneys and paralegal working on this matter and are consistent with the 2017 OSB Economic Survey. For instance, Ms. Dishaw is a member at Williams Kastner & Gibbs with 12 years of experience representing clients in surety matters. Id. ¶ 5. Her requested hourly rate of $275 is consistent with the OSB Economic Survey, which reflects that, in 2017, the average hourly rate for attorneys in private practice in Oregon was $286, and in Portland was $324. Likewise, the requested hourly rates of Mr. Blischke, a partner with over 20 years of experience in construction and surety matters, and Ms. Lee, a senior associate with over 10 years of experience in the same legal fields, are consistent with the average hourly rates for attorneys with similar experience. See 2017 OSB Economic Survey, Table 36 (indicating that the 75th percentile for Oregon attorneys with 20+ years of experience is $350 and for those with 10-12 years of experience is $320). Id. ¶¶ 6-7. Finally, the $110 hourly rate requested by Ms. Patton for her paralegal services is appropriate and supported by her 16 years of experience. Id. ¶ 8. The court concludes that the hourly rates requested are reasonable.
Defendants object to Ohio Casualty's fee request on the grounds that it “seek[s] to recover costs that were incurred over the entirety of this case.” Opp'n to Bill of Costs, ECF No. 87. However, that objection is undermined by the parties' settlement agreement, which expressly provides that, in the event of defendants' breach, Ohio Casualty is entitled to recover “reasonable attorney fees necessarily incurred in the above-captioned case and for enforcing this Confession of Judgment.” Stonefeld Decl. ¶ 2, Ex. A (emphasis added). The Confession of Judgment plainly includes reasonable attorney fees incurred enforcing it and for reasonable attorney fees incurred in this action; therefore, defendants' objection is not well-taken. Defendants do not raise specific objections to the number of hours billed or the hourly rates sought. Nevertheless, the court has reviewed the hours billed by Ohio Casualty's attorneys and finds that they are reasonable. Nat. Res. Def. Council, 771 F.Supp.2d at 1214. Accordingly, the court declines to reduce the attorney fee award requested by Ohio Casualty.
Defendants filed a second general objection to Ohio Casualty's Bill of Costs, which the court struck as untimely on December 5, 2022. ECF No. 94.
The court also recommends granting Ohio Casualty's request for $1,055 in litigation costs. That request is supported by Ms. Dishaw's declaration, which documents the expenses that her firm incurred in litigating this matter. Sec. Dishaw Decl. ¶ 3, Ex. A (documenting filing fees, service, and processing costs). Defendants object to those costs contending that Ohio Casualty is not entitled to litigation costs for the entire action. Opp'n to Bill of Costs. As noted above, the settlement agreement explicitly provides that Ohio Casualty is entitled to reasonable litigation costs if defendants breach the settlement agreement. Stonefeld Decl. ¶ 2, Ex. A. Therefore, defendants' objection is not well taken, and Ohio Casualty is entitled to recover these costs.
Finally, the court recommends granting Ohio Casualty's request for $30,723.29 in prejudgment interest. Under Oregon law, a court may award prejudgment interest when the exact amount, and the time from which interest should run, is ascertained or easily ascertainable. Farhang v. Kariminaser, 230 Or.App. 554, 556, 217 P.3d 218, 219 (2009); see also MLM Prop., LLC v. Country Cas. Ins. Co., Case No. CV 06-3048-CL, 2010 WL 678149, at *9 (D. Or. Feb. 25, 2010) (“‘prejudgment interest may be awarded if: (1) the exact pecuniary amount is ascertained or ascertainable by simple computation, or by reference to generally recognized standards, such as market price, and (2) a time of definite default is ascertainable'” (quoting Soderhamn Mach. Mfg. Co. v. Martin Bros. Container & Timber Prods. Corp., 415 F.2d 1058, 1064 (9th Cir. 1969))). The party requesting prejudgment interest bears the burden on this issue. Farhang, 230 Or.App. at 556.
Here, the Confession of Judgment entitles Ohio Casualty to “interest at a rate of 9% per annum . . . until the full sum owed under this Confession of Judgment is paid in full.” Ohio Casualty requests prejudgment interest accruing on the $100,000 outstanding principle between April 10, 2019-the date that it filed its Amended Complaint-and September 7, 2022-the date on which it requested that defendants stipulate to the motion to enter judgment. Dishaw Decl. ¶ 2. Reviewing this information, the court finds the requested prejudgment interest amount ascertainable for this period and recommends granting Ohio Casualty's request for prejudgment interest.
CONCLUSION
Based on the above, Ohio Casualty's motion to lift the stay and enter judgment (ECF No. 80) and Bill of Costs (ECF No. 85) should be GRANTED. The court recommends lifting the stay on this case and entering judgment for Ohio Casualty Insurance Company and against defendants Chris Dials and Chris Dials Contracting LLC, jointly and severally, for the outstanding principle and the requested attorney fees, costs, and prejudgment interest totaling $155,742.79. Pending motions, if any, should be denied as moot.
SCHEDULING ORDER
The Findings and Recommendation will be referred to Judge Karin J. Immergut. Objections, if any, are due within fourteen days. If no objections are filed, the Findings and Recommendation will go under advisement on that date. If objections are filed, a response is due within fourteen days. When the response is due or filed, whichever date is earlier, the Findings and Recommendation will go under advisement.