HOUSE BILL REPORT

ESSB 5650

BYSenate Committee on Law & Justice (originally sponsored by Senators Pullen, Anderson and McCaslin)

Specifying conditions for the awarding of attorneys' fees.

House Committe on Judiciary

Majority Report:  Do pass as amended.  (15)

      Signed by Representatives Appelwick, Chair; Crane, Vice Chair; Padden, Ranking Republican Member; Brough, Forner, Hargrove, Inslee, P. King, Moyer, H. Myers, Schmidt, Scott, D. Sommers, Tate and Wineberry.

House Staff:Pat Shelledy (786-7149)

AS REPORTED BY COMMITTEE ON JUDICIARY FEBRUARY 22, 1990

BACKGROUND:

As a general rule in Washington state, each party to a civil action is responsible for his or her reasonable attorney's fees. As a general rule, the prevailing party is entitled to recover reasonable costs, disbursements, and expenses.  Generally, the court will decide who is the "prevailing party" for purposes of a particular claim, especially when multiple plaintiffs, defendants, or claims are involved in a lawsuit.  A few statutes however, define "prevailing party" and specifically provide when a court may award attorney's fees, costs, and expenses to the prevailing party.

The federal Equal Access to Justice Act (EAJC) lessens the financial burden of private parties who prevail against the United States Government in agency adversary adjudications or non-tort civil actions, by authorizing the award of attorney fees and expert witness fees.  The EAJC also covers outlays for any study, analysis, engineering report, test, or project necessary in building a case.  To be eligible for the award, the party must prevail and meet certain financial requirements of the statute. Even when the private party prevails against the United States government and is financially eligible, the court will deny the attorney fees and other expenses requested if the United States can demonstrate that its position was "substantially justified." Applications for fees may also be reduced or denied if the court finds that the private litigant used delaying tactics or if special circumstances exist which would make an award unjust. Some states have enacted laws that resemble the EAJC.

SUMMARY:

BILL AS AMENDED:  The Federal Equal Access to Justice Act is a model for a similar statute under Washington law.  The Legislature finds that certain individuals, smaller partnerships, smaller corporations, and other organizations may be deterred from seeking review of or defending themselves against a state agency because of the expense.  The Legislature intends to ensure that those parties have a greater opportunity to pursue their legal rights.

Unless another statute specifically provides otherwise, a party who prevails over the state of Washington in a civil action by or against the state of Washington, other than a tort action for personal injury or wrongful death, shall be awarded reasonable attorney fees and expenses, not to exceed $10,000, unless the court finds that the position of the state of Washington was substantially justified. The court may also reduce or deny the award if the prevailing party engaged in conduct that unduly and unreasonably protracted the final resolution of the case.

"Fees and other expenses" include reasonable attorney fees, the reasonable expenses of expert witnesses, and the reasonable cost of any study, analysis, engineering report, test, or project which the court found to be necessary to prepare the prevailing party's case. The fees shall be based upon prevailing market rates except that the rate for expert witnesses may not exceed the rate of the highest paid expert witnesses hired by the state, and attorney's fees may not exceed $150 an hour unless the court determines that increase is necessary to obtain qualified attorneys or the cost of living justifies a higher fee.

"Prevailing party" means 1) an individual whose net worth does not exceed $2,000,000 at the time the civil action was filed, or 2) any owner of an unincorporated business, or any partnership, corporation, association, or an organization that meets certain federal income tax exemption requirements.

AMENDED BILL COMPARED TO ENGROSSED SUBSTITUTE:  The original provisions are stricken entirely. Original provisions required payment of reasonable attorneys' fee, costs, and expenses to the prevailing party in all civil actions not involving death or personal injury, in which the state of Washington was one of the parties, unless the court found that special circumstances made the award unjust, in which case the court could reduce or deny the award.  The striking amendment replaces all those provisions as described in the summary.

Fiscal Note:      Requested February 23, 1990.

House Committee ‑ Testified For:    Gary Smith, Independent Business Association, Jeanette Barrage, Northwest Legal Foundation; Dick Welsh, NARPO; and Ted Cowan, Public Land Users Society.

House Committee - Testified Against:      Mike Redman, Washington Association of Prosecuting Attorneys (concerned); and Mike Grant, Attorney General's office.

House Committee - Testimony For:    The costs of pursuing or defending an action against a state agency is prohibitive and chills citizen participation in civil legal proceedings.

House Committee - Testimony Against:      A number of statutes exist that have specific attorney's fees provisions that may conflict with the provisions of the bill.  A better policy is to design attorney fees' provisions according to the type of civil action and the special circumstances appropriate to each action.