Attorney fees in condemnation cases: GOLDEN FOODS, INC. V. THE LOUISVILLE & JEFFERSON COUNTY METRO SEWER DISTRICT (COA 11/21/2007)

GOLDEN FOODS, INC. V. THE LOUISVILLE & JEFFERSON COUNTY METRO SEWER DISTRICT
ATTORNEYS FEES: CONDEMNATION ACTION
2006-CA-001645
PUBLISHED: AFFIRMING
PANEL: THOMPSON, PRESIDING; NICKELL, STUMBO CONCUR
COUNTY: JEFFERSON
DATE RENDERED: 11/21/2007

Golden Foods, Inc. (GFI) appeals TC’s Order denying its motion for attorney fees in condemnation action instituted by MSD to acquire GFI’s property in order to implement a sewer improvement project in an unincorporated part of Jefferson County. MSD had previously filed a condemnation action that was dismissed by the TC due to MSD’s conduct not meeting the good faith standard required of condemnors. MSD appealed that dismissal, and began a second round of negotiations with GFI for purchase of the property, which was unsuccessful. MSD then filed a second condemnation action. After conducting a right-to-take hearing, the TC this time granted MSD’s petition after finding that MSD had acted in good faith in attempting to acquire the property. GFI appealed, but the COA affirmed the TC’s grant of the petition (2004-CA-000688-MR unpublished). Back at the TC for further proceedings, GFI filed a motion for attorney fees relating to its successful defense of MSD’s first condemnation petition. The TC denied the motion and ruled that while MSD’s initial negotiations efforts were not sufficient to meet good faith standards to permit the taking, they were not so egregious as to justify the extraordinary award of attorney fees. GFI appealed.

Upon review, the COA began by noting that attorney fees are not recoverable without a specific contractual provision or fee-shifting statute supporting same. However, attorney fees can be awarded in condemnation proceedings under certain circumstances if the TC determines that the condemnor acted in bad faith or caused unreasonable delay. The COA notes that a finding of bad faith does not automatically require a TC to award attorney fees as a matter of law. The decision is within the sound discretion of the TC, and will not be disturbed absent a finding of abuse of discretion. The TC felt that MSD’s improper conduct of suddenly reducing its offer from $60,000 to $4,000 without explanation before the first condemnation action did not rise to the level of the extremely deliberate bad faith acts at issue in two comparison cases (Northern Ky. Port Authority v. Cornett and Bernard v. Russell County Air Board) in which attorney fees were awarded. Because the TC’s ruling was based on proper application of the law and within its broad discretion, the COA affirmed the TC’s decision.

By Chad Kessinger
Schiller, Osbourn, Barnes & Maloney

Please note: I reserve the right to delete comments that are inappropriate, offensive or off-topic.

Leave a Reply

Your email address will not be published.