Pauley v. Gilbert, et al.
Annotate this CaseJanuary 1999 Term
No. 25808
CINDY DAWN PAULEY,
FORMERLY CINDY DAWN SURFACE,
Plaintiff Below, Appellant,
V.
JEANETTE L. SURFACE GILBERT,
GUARDIAN OF THE ESTATE
OF CINDY DAWN SURFACE;
AND
AMERICAN CASUALTY COMPANY
OF READING, PENNSYLVANIA,
A FOREIGN CORPORATION,
Defendants Below, Appellees.
Appeal from the Circuit Court of Kanawha County
Honorable Herman G. Canady, Judge
Civil Action No. 95-C-3994
AFFIRMED, IN PART; VACATED, IN PART;
AND REMANDED
Submitted: May 11, 1999
Filed: July 16, 1999
Charles R. Webb
Giatras & Webb
Charleston, West Virginia
Attorney for the Appellant
Thomas C. Evans, III
Adams, Fisher & Evans
Ripley, West Virginia
Attorney for the Appellee,
Jeanette L. Surface Gilbert
Ancil G. Ramey
Steptoe & Johnson
Charleston, West Virginia
Attorney for the Appellee,
American Casualty Company
The Opinion of the Court was delivered PER CURIAM.
SYLLABUS BY THE COURT
1. "In reviewing challenges to the
findings and conclusions of the circuit court, we apply a two-prong deferential standard
of review. We review the final order and the ultimate disposition under an abuse of
discretion standard, and we review the circuit court's underlying factual findings under a
clearly erroneous standard. Questions of law are subject to a de novo review."
Syllabus point 2, Walker v. West Virginia Ethics Commission, 201 W. Va. 108,
492 S.E.2d 167 (1997).
2. "In reviewing a circuit court's
award of prejudgment interest, we usually apply an abuse of discretion standard. When,
however, a circuit court's award of prejudgment interest hinges, in part, on an
interpretation of our decisional or statutory law, we review de novo that portion
of the analysis." Syllabus point 2, Hensley v. West Virginia Department of Health
& Human Resources, ___ W. Va. ___, 508 S.E.2d 616 (1998).
3. "'"'[T]he trial [court]
. . . is vested with a wide discretion in determining the amount of
. . . court costs and counsel fees, [sic] and the trial [court's]
. . . determination of such matters will not be disturbed upon appeal to this
Court unless it clearly appears that [it] has abused [its] discretion.' Syllabus point 3,
[in part,] Bond v. Bond, 144 W. Va. 478, 109 S.E.2d 16 (1959)." Syl. Pt. 2,
[in part,] Cummings v. Cummings, 170 W. Va. 712, 296 S.E.2d 542 (1982) [(per
curiam)].' Syllabus point 4, in part, Ball v. Wills, 190 W. Va. 517, 438 S.E.2d 860
(1993)." Syllabus point 2, Daily Gazette Co., Inc. v. West Virginia Development
Office, ___ W. Va. ___, ___ S.E.2d ___ (No. 25437 May 19, 1999).
4. "Where there exists no statute
or express written agreement establishing the type of prejudgment interest as being
compound, and in the absence of a recognized exception which would permit the recovery of
compound prejudgment interest, prejudgment interest is simple in kind." Syllabus
point 4, Hensley v. West Virginia Department of Health & Human Resources, ___
W. Va. ___, 508 S.E.2d 616 (1998).
5. "'"'Where the language of a
statute is clear and without ambiguity the plain meaning is to be accepted without
resorting to the rules of interpretation.' Syl. pt. 2, State v. Elder, 152
W. Va. 571, 165 S.E.2d 108 (1968)." Syllabus point 1, Courtney v. State Dept.
of Health of West Virginia, 182 W. Va. 465, 388 S.E.2d 491 (1989).' Syllabus
point 3, Francis O. Day Company, Inc. v. Director, Division of Environmental Protection,
191 W. Va. 134, 443 S.E.2d 602 (1994)." Syllabus point 5, Walker v. West
Virginia Ethics Commission, 201 W. Va. 108, 492 S.E.2d 167 (1997).
6. "As a general rule each litigant
bears his or her own attorney's fees absent a contrary rule of court or express statutory
or contractual authority for reimbursement." Syllabus point 2, Sally-Mike
Properties v. Yokum, 179 W. Va. 48, 365 S.E.2d 246 (1986).
7. "There is authority in equity to
award to the prevailing litigant his or her reasonable attorney's fees as 'costs,' without
express statutory authorization, when the losing party has acted in bad faith,
vexatiously, wantonly or for oppressive reasons." Syllabus point 3, Sally-Mike
Properties v. Yokum, 179 W. Va. 48, 365 S.E.2d 246 (1986).
Per Curiam:
The appellant herein and plaintiff below, Cindy Dawn Pauley [hereinafter "Ms. Pauley"], appeals from the April 14, 1998, order of the Circuit Court of Kanawha County, modifying its earlier judgment order. The first judgment order, entered July 9, 1997, upheld a jury verdict in favor of Ms. Pauley and against the appellee herein and defendant below, Jeanette L. Surface Gilbert [hereinafter "Ms. Gilbert"], and granted Ms. Pauley, in part, prejudgment interest on her compensatory damages award, postjudgment interest on her punitive damages award, and the attorney's fees and costs she incurred in the prosecution of her action against Ms. Gilbert. By its subsequent order, the circuit court recalculated the amount of prejudgment interest to which Ms. Pauley was entitled on her award of compensatory damages and withdrew its earlier awards of postjudgment interest on her punitive damages award and its allowance of attorney's fees and costs.
Upon a review of the parties' arguments, the record designated
for appellate review, and the pertinent authorities, we affirm, in part; vacate, in part;
and remand this case for further proceedings consistent with this opinion. In this regard,
we affirm that portion of the circuit court's April 14, 1998, order which recalculates the
amount of prejudgment interest that Ms. Pauley may recover on her award of compensatory
damages. However, we vacate the circuit court's April 14, 1998, order to the extent that
it denies Ms. Pauley postjudgment interest on her award of punitive damages and her
attorney's fees and costs associated with this action. We further remand this case for the
reinstatement of the court's July 9, 1997, order insofar as it granted postjudgment
interest on punitive damages and awarded attorney's fees and costs.
I.
FACTUAL AND PROCEDURAL HISTORY
The evidence presented at trial suggests the following facts. In
April, 1975, Ms. Pauley's father passed away, leaving her life insurance benefits and
Social Security death benefits. Because Ms. Pauley was a minor when she became the
beneficiary of these funds, Ms. Gilbert, who is Ms. Pauley's mother, was appointed her
guardian and was charged with holding these monies for her daughter until she reached the
age of eighteen. With specific respect to the life insurance benefits, Ms. Gilbert, in her
fiduciary capacity as Ms. Pauley's guardian, obtained two separate surety bonds during her
daughter's minority. These bonds, which were in varying amounts proportionate to the
accrued amount of death benefits at the time of each bond's issuance, were procured from
the second defendant below, American Casualty Company of Reading, Pennsylvania
[hereinafter "American Casualty"].
Also during Ms. Pauley's minority, Ms. Gilbert breached her fiduciary duty as Ms. Pauley's duly appointed guardian by using these monies as collateral for a personal loan and failing to make required accountings to the Kanawha County Commission. Further evidence of her fiduciary breaches includes Ms. Gilbert's actions in misappropriating these assets for her own use, including loaning $20,000 of these funds to her brother, who was subsequently incarcerated, and withdrawing the bulk of her daughter's estate, shortly before Ms. Pauley's eighteenth birthday, to use as purchase money for an adult entertainment establishment.
Upon reaching the age of majority, Ms. Pauley requested from
her mother the monies to which she was then entitled. Although Ms. Gilbert paid Ms. Pauley
certain sums from the trust assets, these payments were fairly insubstantial and fell far
short of the total amount that had been entrusted to her, due to Ms. Gilbert's depletion
of these funds. Thereafter, Ms. Pauley filed a claim against American Casualty, seeking to
recover on her mother's surety bond therewith. Ms. Pauley also instituted a civil action,
naming as defendants Ms. Gilbert and American Casualty. During the course of the jury
trial, in February, 1997, Ms. Pauley settled with American Casualty for $30,000, and
American Casualty was dismissed from the lawsuit. On February 6, 1997, a Kanawha County
jury returned a verdict in Ms. Pauley's favor, finding:
[1.] We, the jury, find that the
defendant, Ms. Gilbert, has failed to meet her burden of proving a valid release.
X YES
NO
. . . .
[2.] We, the jury, find that the
defendant, Ms. Gilbert, violated her fiduciary duty to the plaintiff by converting trust
funds for her personal use, or by her failure to adhere to statutory requirements imposed
upon a legal guardian.
X YES
NO
[3.] We, the jury, award compensatory
damages to the plaintiff as follows:
a. Loss to the
estate of plaintiff
Cindy Dawn Pauley:
$ 33,500.00.
YOU CANNOT AWARD PUNITIVE DAMAGES UNLESS YOU FIND COMPENSATORY
DAMAGES.
[4.] We find the defendant, Jeanette
Gilbert, to be guilty of malicious, wilful, outrageously [sic] and reckless conduct toward
Cindy Dawn Surface Pauley and we award punitive damages.
X YES
NO
Punitive Damages $ 15,000.00 .
Following the return of the jury's verdict, counsel for Ms. Pauley moved for an award of
prejudgment interest, to which counsel for Ms. Gilbert objected. Having considered the
matter, the circuit court submitted to the still-impaneled jury the following special
interrogatory:
(1.) Does the verdict of the jury in
awarding compensatory damages to the plaintiff, Cindy Dawn Pauley, in the amount of
$33,500.00 include interest from the date (dates) of breach of fiduciary duty - to
February 6, 1997?
X YES
NO
(2.) If above answer yes, then what rate
of interest did the jury utilize in its calculation? 6%
Reply
of Jury
By order entered July 9, 1997, the circuit court entered
judgment for Ms. Pauley in accordance with the jury's verdict in her favor. The court
further specified the precise amounts of Ms. Pauley's award:
The jury having returned a jury verdict
awarding to the plaintiff compensatory damages in the amount of $33,500.00 plus $30,056.03
in simple interest at 10% per annum from the date of the breach of May 24, 1990 (the date
on which plaintiff reached age eighteen (18)) for a total judgment of $63,556.03 in
compensatory damages and the court having been advised that in accordance with the Partial
Dismissal Order entered in this action on February 5, 1997 that Cindy Dawn Pauley Surface
[sic] did receive of and from American Casualty Company the sum of $30,000.00, this Court
does proceed to enter judgment upon the jury verdict and it is, accordingly ORDERED that
the plaintiff, Cindy Dawn Surface Pauley, do recover of and from the defendant, Jeanette
Surface Gilbert, in compensatory damages the sum of $33,556.03 with interest thereon from
February 7, 1997 at the legal rate until paid.
The jury having returned a verdict
awarding the plaintiff punitive damages in the amount of $15,000.00, it is accordingly
ORDERED that the plaintiff Cindy Dawn Surface Pauley do recover of and from the defendant
Jeanette Surface Gilbert in punitive damages the sum of $15,000.00 with interest thereon
from February 7, 1997, at the legal rate, until paid.
The Court having so ruled, it did further
FINDS and
ORDERS (1) that the plaintiff is awarded her attorney's fees in the amount of
$16,166.66 for the willful, wanton, outrageous and reckless conduct of the defendant,
which said fee represents one-third of the damages awarded by the jury and finds the same
to be reasonable.
The Court further awards the plaintiff her
costs and expenses in this matter in the amount of $704.48.
After the entry of this judgment order, defendants Ms. Gilbert and American Casualty filed
motions for postjudgment relief. By order filed April 14, 1998, the circuit court denied
American Casualty's request for relief based upon its earlier dismissal from the action.
Nevertheless, the court granted Ms. Gilbert's post-trial motions, and ruled as follows:
First, the Court finds that the judgment
previously entered in this matter on the 9th day of July, 1997, erroneously awarded the
plaintiff interest on interest because the jury's verdict of $33,500.00 in compensatory
damages on the 6th day of February, 1997, expressly included interest in the amount of six
percent per annum.
Second, the Court finds that, in
accordance with W. Va. Code § 56-6-31 (1981), the jury should have awarded
prejudgment interest in the amount of ten percent per annum.
Third, the Court calculates the proper
amount of the compensatory judgment award as follows: $22,651.76 in compensatory damages +
$10,848[.]24 in prejudgment interest @ 6 percent = $33,500.00 awarded by the jury +
$6,823.46 in prejudgment interest @ 4 percent = $40,323.46 - $30,000.00 settlement with
American Casualty = $10,323.46 in total compensatory damages.
Fourth, the Court finds the plaintiff to
be entitled to judgment for compensatory damages in the amount of $10,323.46, and for
post-judgment interest at ten percent per annum to be calculated from February 6, 1997,
until payment is received.
Fifth, the Court affirms the jury's
punitive damages award of $15,000.00, but upon which post-judgment interest does not
accrue.
Finally, the Court finds that there is no
law supporting any award of attorney['s] fees, costs, and expenses in this matter, and
hereby sets aside of its previous award of $16,166.67 in attorney['s] fees and $704.48 in
litigation expenses previously awarded.
It is from this second order of the circuit court, modifying its original judgment order,
that Ms. Pauley appeals to this Court.
II.
STANDARD OF REVIEW
The issues presented for resolution by this Court in the instant
appeal require us to examine the correctness of the circuit court's order concerning the
award of prejudgment interest, postjudgment interest, and attorney's fees and costs.
Generally,
[i]n reviewing challenges to the findings
and conclusions of the circuit court, we apply a two-prong deferential standard of review.
We review the final order and the ultimate disposition under an abuse of discretion
standard, and we review the circuit court's underlying factual findings under a clearly
erroneous standard. Questions of law are subject to a de novo review.
Syl. pt. 2, Walker v. West Virginia Ethics Comm'n, 201 W. Va. 108, 492 S.E.2d 167 (1997). See also Syl. pt. 1, Chrystal R.M. v. Charlie A.L., 194
W. Va. 138, 459 S.E.2d 415 (1995) ("Where the issue on an appeal from the
circuit court is clearly a question of law or involving an interpretation of a statute, we
apply a de novo standard of review."). With specific respect to the propriety
of the circuit court's award of prejudgment interest, we employ a similar standard of
review. "In reviewing a circuit court's award of prejudgment interest, we usually
apply an abuse of discretion standard. When, however, a circuit court's award of
prejudgment interest hinges, in part, on an interpretation of our decisional or statutory
law, we review de novo that portion of the analysis." Syl. pt. 2, Hensley
v. West Virginia Dep't of Health & Human Resources, ___ W. Va. ___, 508 S.E.2d 616 (1998). Likewise, when examining the correctness of a circuit court's award or
denial of costs and attorney's fees, we accord the lower court's decision great deference.
"'"[T]he trial [court]
. . . is vested with a wide discretion in determining the amount of
. . . court costs and counsel fees, [sic] and the trial [court's]
. . . determination of such matters will not be disturbed upon appeal to this
Court unless it clearly appears that [it] has abused [its] discretion." Syllabus
point 3, [in part,] Bond v. Bond, 144 W. Va. 478, 109 S.E.2d 16 (1959).' Syl.
Pt. 2, [in part,] Cummings v. Cummings, 170 W. Va. 712, 296 S.E.2d 542 (1982)
[(per curiam)]." Syllabus point 4, in part, Ball v. Wills, 190 W. Va.
517, 438 S.E.2d 860 (1993).
Syl. pt. 2, Daily Gazette Co., Inc. v. West Virginia Dev. Office, ___ W. Va.
___, ___ S.E.2d ___ (No. 25437 May 19, 1999). With these standards of review in mind, we
now proceed to consider Ms. Pauley's assignments of error.
III.
DISCUSSION
On appeal to this Court, Ms. Pauley assigns three errors. First,
the circuit court erroneously calculated the amount of prejudgment interest to which she
is entitled on her award of compensatory damages. Second, the circuit court incorrectly
ruled that postjudgment interest does not accrue on punitive damages awards. Third, the
circuit court improperly found that Ms. Pauley has no right to recover her attorney's fees
and costs associated with the litigation of this action for breach of fiduciary duty. We
will address each of these assignments of error in turn.
A. Award of Prejudgment Interest on Compensatory Damages
Ms. Pauley first complains that the circuit court erroneously
calculated the amount of prejudgment interest to which she is entitled on her award of
compensatory damages. In its modified judgment order of April 14, 1998, the circuit court
determined that the amount of prejudgment interest payable on Ms. Pauley's award of
compensatory damages is at the rate of ten percent, instead of the six percent rate
incorporated by the jury. Therefore, the court revised its earlier award of prejudgment
interest and
calculate[d] the proper amount of the compensatory judgment award
as follows: $22,651.76 in compensatory damages + $10,848[.]24 in prejudgment interest @ 6
percent = $33,500.00 awarded by the jury + $6,823.46 in prejudgment interest @ 4 percent =
$40,323.46 - $30,000.00 settlement with American Casualty = $10,323.46 in total
compensatory damages.
Ms. Pauley contends that this modified award is nevertheless erroneous because it
improperly applies the amount of her settlement with American Casualty to the date on
which prejudgment interest should begin to accrue, i.e., May 24, 1990, the date of
her eighteenth birthday, rather than to the date of the settlement's actual payment, i.e.,
February 5, 1997. Additionally, Ms. Pauley suggests that the additional four percent
prejudgment interest to which she is entitled by reason of the jury's inadequate award of
prejudgment interest should be compounded and calculated upon the $33,500 compensatory
damages figure. Ms. Gilbert responds that the circuit court properly calculated the
prejudgment interest payable upon Ms. Pauley's award of compensatory damages.
We begin our decision of this issue by referring to the
statutory provision governing awards of prejudgment interest, W. Va. Code
§ 56-6-31 (1981) (Repl. Vol. 1997). This statute provides
[e]xcept where it is otherwise provided by
law, every judgment or decree for the payment of money entered by any court of this State
shall bear interest from the date thereof, whether it be so stated in the judgment or
decree or not: Provided, that if the judgment or decree, or any part thereof, is for
special damages, as defined below, or for liquidated damages, the amount of such special
or liquidated damages shall bear interest from the date the right to bring the same shall
have accrued, as determined by the court. Special damages includes lost wages and income,
medical expenses, damages to tangible personal property, and similar out-of-pocket
expenditures, as determined by the court. The rate of interest shall be ten dollars upon
one hundred dollars per annum, and proportionately for a greater or lesser sum, or for a
longer or shorter time, notwithstanding any other provisions of law.
Id. See also Syl. pt. 3, Hensley v. West Virginia Dep't of Health &
Human Resources, ___ W. Va. ___, 508 S.E.2d 616 ("'Prejudgment interest
accruing on amounts as provided by law prior to July 5, 1981, is to be calculated at a
maximum annual rate of six percent under W. Va. Code, 47-6-5(a) [1974], and thereafter,
at a maximum annual rate of ten percent in accordance with the provisions of W. Va.
Code, 56-6-31 [1981].' Syllabus point 7, Bell v. Inland Mutual Insurance Co.,
175 W. Va. 165, 332 S.E.2d 127 (1985)." (emphasis added)).
In accordance with this language, it is indisputably clear that
Ms. Pauley is entitled to an award of prejudgment interest at the statutory rate of ten
percent as her cause of action accrued on May 24, 1990, after the ten percent rate became
effective. Therefore, we find that the circuit court did not abuse its discretion by
modifying the jury's award of a six percent prejudgment interest rate to include the
correct amount of prejudgment interest, that being the statutory ten percent rate. The
crux of this assignment, however, is whether the circuit court properly calculated this
amount. Based upon the record evidence, we conclude that the circuit court did not abuse
its discretion in rendering the above-quoted modified award of prejudgment interest on Ms.
Pauley's award of compensatory damages.
First, we find Ms. Pauley's assertion that the circuit court
improperly applied the settlement monies she received from American Casualty to her award
of compensatory damages to be without merit. The circuit court's order clearly indicates
that the court separated the interest-inclusive jury award of compensatory damages into
its respective component parts of damages and six percent prejudgment interest. After
arriving at these figures, the court then calculated prejudgment interest on the bare
damages award at the rate of four percent to compensate Ms. Pauley for the full ten
percent of prejudgment interest to which she is entitled by law. Only after calculating
the additional four percent interest on the initial award of compensatory damages did the
circuit court subtract the American Casualty settlement of $30,000 from the amount for
which Ms. Gilbert remains liable. Thus, it is apparent that the circuit court did not
improperly or prematurely apply the settlement monies to its calculations of Ms. Pauley's
compensatory damages prejudgment interest.
Similarly, we reject Ms. Pauley's proffered calculation of four
percent compound prejudgment interest upon the whole of the compensatory damages award,
which includes six percent prejudgment interest, of $33,500 returned by the jury. Quite
recently this Court has admonished that "[w]here there exists no statute or express
written agreement establishing the type of prejudgment interest as being compound, and in
the absence of a recognized exception which would permit the recovery of compound
prejudgment interest, prejudgment interest is simple in kind." Syl. pt. 4, Hensley,
___ W. Va. ___, 508 S.E.2d 616. Were we to adopt the calculations suggested by Ms.
Pauley, not only would we be expressly allowing compound prejudgment interest in direct
contravention of our precise holding to the contrary, as there is no indication that
compound prejudgment interest is permissible in this case, but we would also be permitting
a calculation of interest that is, simply stated, wrong.
The proper method of calculating simple prejudgment interest is
that employed by the circuit court whereby the missing portion of interest is calculated
upon the base award of damages, and that amount added to the sum of (1) the compensatory
damages award and (2) the included portion of prejudgment interest, i.e., six
percent. To compute the omitted prejudgment interest as suggested by Ms. Pauley would
incorrectly permit the award of compound prejudgment interest since the omitted four
percent prejudgment interest rate would be applied not just to the initial award of
compensatory damages but also to the entire amount of six percent prejudgment interest,
which was previously awarded by the jury and which had accrued from Ms. Pauley's date of
injury, May 24, 1990, to the date of the jury's verdict, February 6, 1997. This result we
simply cannot countenance. Finding that the circuit court did not abuse its discretion in
modifying its earlier award of prejudgment interest on Ms. Pauley's compensatory damages
award, we affirm the court's order in this regard.
B. Award of Postjudgment Interest on Punitive Damages
Next, Ms. Pauley argues that the circuit court incorrectly ruled
that postjudgment interest does not accrue on punitive damages awards. In its original
judgment order of July 9, 1997, the circuit court awarded Ms. Pauley postjudgment interest
on the jury's $15,000 award of punitive damages. By its later order wherein it revisited
the original judgment order, though, the circuit court, without explanation, revoked its
earlier award of postjudgment interest on Ms. Pauley's punitive damages award, ruling only
that "post-judgment interest does not accrue" on awards of punitive damages.
With this assignment of error, Ms. Pauley seeks to recover postjudgment interest on her
punitive damages award. Ms. Gilbert's response is silent as to this issue.
The query we have been asked to resolve in this assignment of
error is whether postjudgment interest may be granted on an award of punitive damages. As
with our determination of the propriety of the circuit court's prejudgment interest award,
we look first to the applicable statute governing awards of postjudgment interest. In
pertinent part, W. Va. Code § 56-6-31 directs that
[e]xcept where it is otherwise provided by
law, every judgment or decree for the payment of money entered by any court of this
State shall bear interest from the date thereof, whether it be so stated in the judgment
or decree or not . . . . The rate of interest shall be ten dollars upon
one hundred dollars per annum, and proportionately for a greater or lesser sum, or for a
longer or shorter time, notwithstanding any other provisions of law.
(Emphasis added).
To discern the import of this language, we necessarily must
glean the legislative intent underlying this enactment. "'"The primary object in
construing a statute is to ascertain and give effect to the intent of the
Legislature." Syllabus point 1, Smith v. State Workmen's Compensation Commissioner,
159 W. Va. 108, 219 S.E.2d 361 (1975).' Syllabus point 6, State ex rel. ACF
Industries, Inc. v. Vieweg, ___ W. Va. ___, ___ S.E.2d ___ (No. 25142 Feb. 5,
1999)." Syl. pt. 3, Daily Gazette Co., Inc. v. West Virginia Dev. Office, ___
W. Va. ___, ___ S.E.2d ___ (No. 25437 May 19, 1999).
"'"Where the language of a
statute is clear and without ambiguity the plain meaning is to be accepted without
resorting to the rules of interpretation." Syl. pt. 2, State v. Elder, 152
W. Va. 571, 165 S.E.2d 108 (1968).' Syllabus point 1, Courtney v. State Dept. of
Health of West Virginia, 182 W. Va. 465, 388 S.E.2d 491 (1989)." Syllabus
point 3, Francis O. Day Company, Inc. v. Director, Division of Environmental Protection,
191 W. Va. 134, 443 S.E.2d 602 (1994).
Syl. pt. 5, Walker v. West Virginia Ethics Comm'n, 201 W. Va. 108, 492 S.E.2d 167. See also Syl. pt. 4, Daily Gazette, ___ W. Va. ___, ___ S.E.2d ___
(No. 25437 May 19, 1999) ("'"A statutory provision which is clear and
unambiguous and plainly expresses the legislative intent will not be interpreted by the
courts but will be given full force and effect." Syl. Pt. 2, State v. Epperly,
135 W. Va. 877, 65 S.E.2d 488 (1951).' Syllabus point 1, State v. Jarvis, 199
W. Va. 635, 487 S.E.2d 293 (1997).").
The portion of W. Va. Code § 56-6-31 quoted above plainly and clearly entitles any person who has received a money judgment to an award of ten percent postjudgment interest thereon. Moreover, this language does not specifically exclude punitive or exemplary damages from its operation, but applies to all types of damages by its express terms: "every judgment or decree for the payment of money entered by any court of this State shall bear interest from the date thereof . . . ." W. Va. Code § 56-6-31 (emphasis added). Finally, the Legislature's inclusion of the word "shall" indicates that an award of postjudgment interest in accordance with W. Va. Code § 56-6-31 is mandatory and not within the circuit court's discretion. See Syl. pt. 1, Nelson v. West Virginia Pub. Employees Ins. Bd., 171 W. Va. 445, 300 S.E.2d 86 (1982) ("It is well established that the word 'shall,' in the absence of language in the statute showing a contrary intent on the part of the Legislature, should be afforded a mandatory connotation.").
Based upon the plain language of W. Va. Code § 56-6-31,
we determine that Ms. Pauley was entitled to receive postjudgment interest on her award of
punitive damages. Because we find that the circuit court erred by denying postjudgment
interest in this regard, we vacate the court's April 14, 1998, order with respect to this
ruling. We further remand this case for the reinstatement of the lower court's order of
July 9, 1997, insofar as that order awarded Ms. Pauley postjudgment interest on her
punitive damages award.
C. Award of Attorney's Fees and Costs of Litigation
Ms. Pauley lastly contends that the circuit court improperly found
that she has no right to recover her attorney's fees and costs associated with the
litigation of this action for breach of fiduciary duty. In its order of July 9, 1997, the
circuit court
awarded her attorney's fees in the amount of $16,166.66 for the
willful, wanton, outrageous and reckless conduct of the defendant, which said fee
represents one-third of the damages awarded by the jury and finds the same to be
reasonable.
The Court further award[ed] the plaintiff
her costs and expenses in this matter in the amount of $704.48.
However, when the circuit court modified its original judgment order on April 14, 1998, it
found "that there is no law supporting any award of attorney['s] fees, costs, and
expenses in this matter, and hereby sets aside of its previous award of $16,166.67 in
attorney['s] fees and $704.48 in litigation expenses previously awarded." From this
denial of attorney's fees and costs, Ms. Pauley appeals to this Court and requests that
she be awarded these litigation expenses. By contrast, Ms. Gilbert maintains that Ms.
Pauley is not entitled to recover her attorney's fees or costs in this action.
The first item contested in this assignment of error is the
availability of attorney's fees. "As a general rule each litigant bears his or her
own attorney's fees absent a contrary rule of court or express statutory or contractual
authority for reimbursement." Syl. pt. 2, Sally-Mike Properties v. Yokum, 179
W. Va. 48, 365 S.E.2d 246 (1986). While no express authority exists for the
recoupment of attorney's fees under the precise facts of the instant appeal involving a
fiduciary's breach of her duties, there nevertheless exists express statutory authority
for the recovery of nominal attorney's fees in W. Va. Code § 59-2-14 (1995)
(Repl. Vol. 1997). This provision mandates that the clerk of a court in which a party
prevails "shall include in the costs to the prevailing party: (a) In any civil
action, ten dollars . . . ." Id. See also Sally-Mike
Properties, 179 W. Va. at 50, 365 S.E.2d at 248 ("W. Va. Code,
59-2-14 [1960] requires the clerk of a court to tax as part of the costs a nominal
statutory attorney's fee of ten dollars for a civil action in circuit court
. . . ."). "Ordinarily, attorney's fees in excess of the nominal
statutory amounts provided by W. Va. Code, 59-2-14 [1960] are not
'costs.'" Sally-Mike Properties, 179 W. Va. at 50, 365 S.E.2d at 248
(citations omitted). Although, "[t]here is authority in equity to award to the
prevailing litigant his or her reasonable attorney's fees as 'costs,' without express
statutory authorization, when the losing party has acted in bad faith, vexatiously,
wantonly or for oppressive reasons." Syl. pt. 3, id.
With these principles in mind, we consider whether Ms. Pauley
is entitled to recover her attorney's fees in this case. We find that the egregious facts
and circumstances giving rise to these proceedings warrant such an award and that the
circuit court erred in denying Ms. Pauley this relief. Based upon the considerable record
evidence, we conclude that Ms. Gilbert's actions in failing to perform her legally-
prescribed fiduciary duties and in misappropriating the corpus of Ms. Pauley's trust
account for her own use constituted "bad faith, vexatious[], wanton[] [and]
. . . oppressive" behavior meriting an award of attorney's fees in Ms.
Pauley's favor for her efforts in prosecuting this lawsuit to recover monies that are
lawfully hers. Therefore, we vacate the circuit court's April 14, 1998, order to the
extent that it denied an award of attorney's fees to Ms. Pauley and remand this case for
the reinstatement of the court's July 9, 1997, which granted such relief.
The second issue contested in this assignment of error is
whether Ms. Pauley is entitled to recover the costs of litigation she incurred as a result
of this lawsuit. As with awards of attorney's fees, "'"[c]osts were unknown at
common law. They are created and provided for by statute and may be imposed, recovered or
collected only as authorized by statute."'" Sally-Mike Properties, 179
W. Va. at 50, 365 S.E.2d at 248 (quoting Geary Land Co. v. Conley, 175
W. Va. 809, 813, 338 S.E.2d 410, 414 (1985) (per curiam) (quoting Humphrey v.
Mauzy, 155 W. Va. 89, 95, 181 S.E.2d 329, 332 (1971) (citations omitted))). The
statutory provision authorizing a prevailing party to recover his/her litigation expenses,
W. Va. Code § 59-2-8 (1923) (Repl. Vol. 1997), states that "[e]xcept where
it is otherwise provided, the party for whom final judgment is given in any action, or in
a motion for judgment for money, whether he be plaintiff or defendant, shall
recover his costs against the opposite party . . . ." (Emphasis
added). Because the term "shall" is generally afforded a mandatory connotation, see
Syl. pt. 1, Nelson v. West Virginia Public Employees Insurance Board, 171
W. Va. 445, 300 S.E.2d 86, and because it is indisputable that the jury's verdict in
Ms. Pauley's favor renders her the prevailing party, we find that Ms. Pauley is
unquestionably entitled to recover her costs in accordance with W. Va. Code
§ 59-2-8. Thus, we vacate the circuit court's order of April 14, 1998, denying Ms.
Pauley her costs and remand this matter for the reinstatement of the court's July 9, 1997,
order wherein it awarded her such relief.
IV.
CONCLUSION
For the foregoing reasons, we conclude that the circuit court
properly recalculated the amount of prejudgment interest to which Ms. Pauley is entitled
on her award of compensatory damages, and we affirm the circuit court's April 14, 1998,
order in this regard. Furthermore, we find that the circuit court erroneously denied Ms.
Pauley postjudgment interest on her award of punitive damages and her attorney's fees and
costs associated with this action. Therefore, we vacate the circuit court's April 14,
1998, order to the contrary and remand this case for the reinstatement of the court's
order of July 9, 1997, insofar as that order granted postjudgment interest on Ms. Pauley's
award of punitive damages and permitted her to recover from Ms. Gilbert the attorney's
fees and costs she incurred in this lawsuit. Accordingly, the April 14, 1998, order of the
Circuit Court of Kanawha County is hereby affirmed, in part, and vacated, in part, and
this case is remanded for further proceedings consistent with this opinion.
Affirmed,
in part; Vacated, in part; and Remanded.
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