ATTORNEYS FEES: Post judgment work: MOORHEAD V. DODD (SC 9/18/2008)

ATTORNEYS FEES:  Post judgment work
PUBLISHED: Reversing
Opinion by Scott; Schroder not sitting
Date Rendered: 9/18/2008

Moorhead initiated an action for breach of contract against Manning Equipment Company stemming from a real property purchase agreement which ultimately fell through. A jury returned a favorable verdict for Moorhead, and the TC also awarded Moorhead her attorney fees in accordance with the purchase agreement. Manning appealed and the COA upheld the judgment. Thereafter, Moorhead went back to the TC seeking recovery of the additional attorney fees incurred in defending the appeal. The TC denied the request on the basis that it lacked jurisdiction to do so. Moorhead appealed this denial and concurrently filed a new action against Dodd (Executrix of Manning’s estate) for recovery of the fees under the agreement. The COA upheld the TC’s dismissal. The TC in the new action later granted summary judgment for Dodd by deeming the original judgment res judicata and holding that Moorhead should have reserved the issue of post-judgment attorney fees in the original action. The COA this time also affirmed the TC dismissal in a split decision, agreeing the action was barred as res judicata.

The Supreme Court granted discretionary review to consider the issue of whether Moorhead could recover post-judgment fees and if so, how. Justice Scott’s opinion begins by discussing the legal distinction between claim and issue preclusion before succinctly stating that res judicata does not preclude Moorhead from maintaining her lawsuit since the claim relates to fees incurred after the original judgment. It was not necessary for Moorhead to reserve the issue of post-judgment fees nor was she required to do so. No claim for such fees had not accrued until after the judgment entry. The Court could find no policy reasons for barring Moorhead’s claim especially when considering the present action for appeal-related attorney fees arose due to Manning’s own conduct in filing the appeal even though he was aware of the contractual obligations for the fees. The Court concluded that while parties are required to bring forward their whole cause, it declined to impose a duty to anticipate all fees or expenses that would flow from an appeal. The case was remanded to the TC for further proceedings.

Chad Kessinger
Schiller Osbourn Barnes & Maloney

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