H-1370

AN ACT Relating to attorneys' fees, costs, and expenses awarded against the state; adding a new section to chapter 4.84 RCW; and creating new sections.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

NEW SECTION. Sec. 1. The legislature finds that certain individuals, smaller partnerships, smaller corporations, and other organizations may be deterred from seeking review of or defending against unreasonable agency action because of the expense involved in securing the vindication of their rights in administrative proceedings. The legislature further finds that because of the greater resources of the state of Washington, individuals, smaller partnerships, smaller corporations, and other organizations are often deterred from seeking review of or defending against state agency actions because of the costs for attorneys, expert witnesses, and other costs. The legislature therefore adopts this equal access to justice act to ensure that these parties have a greater opportunity to defend themselves from inappropriate state agency actions and to protect their rights.

NEW SECTION. Sec. 2. A new section is added to chapter 4.84 RCW to read as follows:

(1)(a) Except as otherwise specifically provided by statute, a court shall award to a prevailing party other than the state of Washington fees and other expenses including reasonable attorneys' fees, in addition to any reasonable costs awarded, incurred by that party in any civil action except an action for personal injury or wrongful death, including proceedings for judicial review of agency action, unless the court finds that the position of the state of Washington was substantially justified or that circumstances make an award unjust.

(b) A party seeking an award of fees and other expenses shall, within thirty days of final judgment in the action, submit to the court an application for fees and other expenses which shows that the party is a prevailing party and is eligible to receive an award under this subsection, and the amount sought, including an itemized statement from any attorney or expert witness representing or appearing on behalf of the party stating the actual time expended and the rate at which fees and other expenses were computed. The party shall also allege that the position of the state of Washington was not substantially justified. Whether or not the position of the state of Washington was substantially justified shall be determined on the basis of the record, including the record with respect to the action or failure by the agency upon which the civil action is based, which is made in the civil action for which fees and other expenses are sought.

(c) The court, in its discretion, may reduce the amount to be awarded pursuant to this subsection, or deny an award, to the extent that the prevailing party during the course of the proceedings engaged in conduct which unduly and unreasonably protracted the final resolution of the matter in controversy.

(2) For purposes of this section:

(a) "Fees and other expenses" includes the reasonable expenses of expert witnesses, the reasonable cost of any study, analysis, engineering report, test, or project which is found by the court to be necessary for the preparation of the party's case, and reasonable attorneys' fees. The amount of fees awarded under this subsection shall be based upon the prevailing market rates for the kind and quality of the services furnished, except that (i) no expert witness shall be compensated at a rate in excess of the highest rate of compensation for expert witnesses paid by the state of Washington; and (ii) attorneys shall not be awarded in excess of one hundred fifty dollars per hour unless the court determines that an increase in the cost of living or a special factor, such as the limited availability of qualified attorneys for the proceedings involved, justify a higher fee;

(b) "Party" means (i) an individual whose net worth did not exceed two million dollars at the time the civil action was filed, or (ii) any owner of an unincorporated business, or any partnership, corporation, association, or organization, the net worth of which did not exceed seven million dollars at the time the civil action was filed; except that an organization described in section 501(c)(3) of the Internal Revenue Code of 1986 (26 U.S.C. Sec. 501 (c)(3)) exempt from taxation under section 501(a) of the Internal Revenue Code of 1986 (26 U.S.C. Sec. 501(a)), or a cooperative association as defined by section 15(a) of the agricultural marketing act (12 U.S.C. Sec. 1141j(a)), may be a party regardless of the net worth of such organization or cooperative association;

(c) "Washington state" includes any agency and any official of the state of Washington acting in his or her official capacity;

(d) "Position of the state of Washington" means, in addition to the position taken by the state of Washington in the civil action, the action or failure to act by the agency upon which the civil action is based; except that fees and expenses may not be awarded to a party for any portion of the litigation in which the party has unreasonably protracted the proceedings;

(e) "Civil action" means a civil action brought by or against the state of Washington and includes an appeal by a party of a decision of an agency action.

NEW SECTION. Sec. 3. The office of financial management shall report annually to the legislature on the amount of fees and other expenses awarded during the preceding fiscal year under this act. The report shall describe the number, nature, and amount of the awards, the claims involved in the controversy, and any other relevant information which may aid the legislature in evaluating the scope and impact of the awards.