607-14

Attorneys' fees in actions in the nature of assumpsit, etc.

§607-14 Attorneys’ fees in actions in the nature of assumpsit, etc. In all the courts, in all actions in the nature of assumpsit and in all actions on a promissory note or other contract in writing that provides for an attorney’s fee, there shall be taxed as attorneys’ fees, to be paid by the losing party and to be included in the sum for which execution may issue, a fee that the court determines to be reasonable; provided that the attorney representing the prevailing party shall submit to the court an affidavit stating the amount of time the attorney spent on the action and the amount of time the attorney is likely to spend to obtain a final written judgment, or, if the fee is not based on an hourly rate, the amount of the agreed upon fee. The court shall then tax attorneys’ fees, which the court determines to be reasonable, to be paid by the losing party; provided that this amount shall not exceed twenty-five per cent of the judgment.

Where the note or other contract in writing provides for a fee of twenty-five per cent or more, or provides for a reasonable attorney’s fee, not more than twenty-five per cent shall be allowed.

Where the note or other contract in writing provides for a rate less than twenty-five per cent, not more than the specified rate shall be allowed.

Where the note or other contract in writing provides for the recovery of attorneys’ fees incurred in connection with a prior debt, those attorneys’ fees shall not be allowed in the immediate action unless there was a writing authorizing those attorneys’ fees before the prior debt was incurred. “Prior debt” for the purposes of this section is the principal amount of a debt not included in the immediate action.

The above fees provided for by this section shall be assessed on the amount of the judgment exclusive of costs and all attorneys’ fees obtained by the plaintiff, and upon the amount sued for if the defendant obtains judgment.

Nothing in this section shall limit the recovery of reasonable attorneys’ fees and costs by a planned community association and its members in actions for the collection of delinquent assessments, the foreclosure of any lien, or the enforcement of any provision of the association’s governing documents, or affect any right of a prevailing party to recover attorneys’ fees in excess of twenty-five per cent of the judgment pursuant to any statute that specifically provides that a prevailing party may recover all of its reasonable attorneys’ fees. “Planned community association” for the purposes of this section means a nonprofit homeowners or community association existing pursuant to covenants running with the land. [L 1872, c 29, §5; RL 1925, §2551; RL 1935, §3800; am L 1935, c 26, §1; RL 1945, §9754; RL 1955, §219-14; HRS §607-14; am L 1972, c 88, §5(q); am L 1993, c 200, §1; am L 1994, c 74, §1; am L 1997, c 132, §2]

Cross References

Planned community associations, see chapter 421J.

Law Journals and Reviews

Rethinking Attorney’s Fees in Assumpsit Actions. 13 HBJ, no. 13, at 115 (2009).

Case Notes

In a diversity based breach of contract action involving California guaranty law and federal securities laws, Hawaii court properly applied California law on attorney’s fees. 557 F.2d 1351 (1977).

Error to find section inapplicable solely because tort claims included in complaint. 673 F.2d 284 (1982).

Presumption that complaint sounds in assumpsit and not in tort. 673 F.2d 284 (1982).

District court appropriately determined that plaintiffs’ action, where complaint alleged negligence, breach of contract, breach of express and implied warranty, and legal malpractice, and prayer for relief requested attorney fees and costs, was “in the nature of assumpsit” for purposes of this section. 105 F.3d 530 (1997).

District court correctly deemed individual plaintiffs to be “losing parties” within meaning of this section. 229 F.3d 877 (2000).

District court did not err in awarding employer attorneys’ fees, where employees argued that employer’s claim for breach of employees’ duty of loyalty was not an assumpsit action because the remedy awarded, disgorgement, was not a proper remedy for breach of contract. 338 F.3d 1082 (2003).

Bankruptcy court did not err in applying the twenty-five per cent limit on attorneys’ fees where appellant debtor requested only damages and attorneys’ fees for debtor’s breach of contract claim; further, the monetary damages for the contract claim were easily discernible as debtor’s lost equity in debtor’s property; moreoever, debtor’s election of remedies did not render the value returned to debtor an “economic incident of the judgment” that can escape the twenty-five per cent limit. 674 F.3d 1083 (2012).

Recovery upon rescission of contract is in assumpsit. 225 F. Supp. 474 (1964); 5 H. App. 174, 683 P.2d 883 (1984).

This section applicable where plaintiff sued on insurance policy under clause of policy permitting suit by one recovering judgment against insured. 255 F. Supp. 710 (1966).

Court did not have jurisdiction and therefore could not reach whether defendants were “prevailing parties” for purposes of this section. 679 F. Supp. 2d 1220 (2010).

Because defendant obtained judgment in the action, the twenty-five per cent limitation on attorneys’ fees should be based upon the amount sued for, i.e., the value of the loan amount. 933 F. Supp. 2d 1264 (2013).

In order to be deemed the prevailing party for purposes of this section, defendant must have obtained final judgment in its favor. Insofar as the court entered final judgment in defendant’s favor, there could be no dispute that defendant was the prevailing party. 933 F. Supp. 2d 1264 (2013).

Where two of the five claims in the complaint were in the nature of assumpsit, the court could not practicably apportion between the assumpsit and non-assumpsit claims because the claims were inextricably intertwined. Moreover, the hours expended in the action and motions practice were not directed at any specific claims. 933 F. Supp. 2d 1264 (2013).

Necessity for final determination of cause. 12 H. 348 (1900) (summons or service quashed); 19 H. 258 (1908) (dismissal for failure to give security for costs); 21 H. 408 (1913) (nonsuit for failure of proof); 39 H. 254 (1952) (judgment sustaining demurrer); cf. 16 H. 783 (1904) (judgment for defendant on special demurrer).

After appeal from district court computed on circuit court judgment. 14 H. 495 (1902).

Effect of partial reduction of judgment on appeal. 16 H. 635 (1905).

Where plaintiff is attorney. 16 H. 803 (1905). Whether classed as “costs”. 21 H. 368 (1912); cf. 16 H. 635 (1905). Payable as part of judgment. 24 H. 16 (1917).

Not allowed against government. 20 H. 112 (1910).

“Assumpsit” defined. 21 H. 583 (1913); 29 H. 376, 386 (1926); 40 H. 92 (1953).

Where an appeal judgment for appellee is vacated and case remanded for new trial, appellee not entitled to attorney’s fees. 62 H. 34, 609 P.2d 137 (1980).

Claim was in the nature of assumpsit. 67 H. 433, 690 P.2d 279 (1984).

Where there is a specific contractual provision for attorney’s fees, §607-17 should be applied. 72 H. 4, 803 P.2d 199 (1990).

Section inapplicable where claim sounds in tort rather than assumpsit. 74 H. 1, 837 P.2d 1273 (1992).

Appellants entitled to award of reasonable attorneys’ fees incurred in bringing appeal on the action for breach of the covenant against encumbrances. 76 H. 396, 879 P.2d 501 (1994).

Supreme court has jurisdiction to award reasonable attorneys’ fees incurred on appeal, and supreme court may do so if requirements of HRAP rule 39(d) and this section are met; decisions about fees incurred at trial level more properly within trial court’s discretion. 76 H. 396, 879 P.2d 501 (1994).

Where plaintiff’s claim for specific enforcement of agreement was not action in assumpsit, trial court’s denial of plaintiff’s request for attorney’s fees against defendant proper. 85 H. 19, 936 P.2d 655 (1997).

Under this section, an action in the nature of assumpsit does not need a clause in writing providing for attorneys’ fees in order for attorneys’ fees to be granted. 86 H. 21, 946 P.2d 1317 (1997).

Under this section, attorneys’ fees may be awarded in three types of cases: all actions in the nature of assumpsit; all actions on a promissory note; and contracts in writing that provide for an attorney’s fee. 86 H. 21, 946 P.2d 1317 (1997).

Further waiver of sovereign immunity not necessary for this section to apply to the State and its agencies in matters in which, by virtue of the express waiver of sovereign immunity set forth in §661-1, the State has become a party. 87 H. 37, 951 P.2d 487 (1998).

Where Oregon law firm did not “practice law within the jurisdiction” of Hawaii, it did not violate §605-14 nor §605-17; thus plaintiff could recover fees under this section for services rendered by firm. 87 H. 37, 951 P.2d 487 (1998).

Where plaintiffs prevailed “on the disputed main issue”, they were entitled to recoup all of their litigation expenses pursuant to this section. 87 H. 37, 951 P.2d 487 (1998).

As this section does not expressly or obviously manifest an intent to be applied retroactively, the 1993 amendment does not apply retroactively to litigation terminated prior to the effective date of the amendment, July 1, 1993. 88 H. 46, 961 P.2d 611 (1998).

Proper cap on the maximum amount of attorneys’ fees that can be awarded as a result of circuit court action where final judgment was entered in 1992 is that found in the statute in effect in 1992; this statutory cap is the maximum total amount that can be awarded, not an amount that can be awarded to each prevailing party. 88 H. 46, 961 P.2d 611 (1998).

Where the maximum possible judgment is capable of determination, it should serve as a limit on the amount of the defendant’s attorney’s fees pursuant to this section. 88 H. 115, 962 P.2d 374 (1998).

Where reduction of the attorneys’ fees requested was supported by the record, trial court’s reduction of fees without explanation was not abuse of discretion. 90 H. 25, 975 P.2d 1145 (1998).

Award of attorneys’ fees for defendant erroneous where plaintiff’s claims against defendant stemmed primarily from allegations of fraud, breach of fiduciary duty, and statutory violations, not breach of contract. 92 H. 243, 990 P.2d 713 (1999).

Where purchaser prevailed on its claim to the contract deposit and successfully defended against plaintiff’s specific performance/breach claim, purchaser, “on balance”, was the prevailing party on the issues in the case and was thus entitled to reasonable attorneys’ fees under this section. 92 H. 482, 993 P.2d 516 (2000).

Plaintiff not entitled to attorneys’ fees pursuant to this section for plaintiff’s appeal as an appeal is not a distinct “action” but a continuation of the original action and plaintiff’s underlying action in the trial court sounded in tort and not assumpsit. 93 H. 1, 994 P.2d 1047 (2000).

A defendant who succeeds in obtaining a judgment of dismissal is a prevailing party for the purposes of fees under this section. 96 H. 327, 31 P.3d 184 (2001).

In appropriate cases, a request or award of attorneys’ fees may include compensation for separately billed legal services performed by a paralegal, legal assistant, or law clerk; the reasonableness of legal assistant fees must be reviewed on a case by case basis for the value of services rendered and an award of such fees must be limited to charges for work performed that would otherwise have been required to be performed by a licensed attorney at a higher rate. 96 H. 327, 31 P.3d 184 (2001).

As proceedings under §431:15-323 are not in the nature of assumpsit, trial court did not err in denying insurance commissioner attorneys’ fees under this section in suit against customer of liquidated mutual benefit society. 99 H. 53, 52 P.3d 823 (2002).

Section applies only to court actions and not arbitration proceedings; thus, section does not affect disputes submitted in arbitration. 102 H. 210, 74 P.3d 33 (2003).

The plain language of this section does not require a judgment on the merits; a dismissal of plaintiff’s action, albeit voluntary, was sufficient to deem a defendant to be the prevailing party and the plaintiff the losing party; thus defendant was the “prevailing party” and plaintiff was the “losing party” for the purpose of awarding attorneys’ fees pursuant to this section. 103 H. 26, 79 P.3d 119 (2003).

Trial court erred in awarding attorneys’ fees to insurer pursuant to this section as this section does not provide for attorneys’ fees in declaratory judgment actions; relief sought by insured and insurer was a declaration as to the applicability of insurance coverage for insured’s injuries, not money damages, and was thus not in the nature of assumpsit. 103 H. 263, 81 P.3d 1178 (2003).

Where record on appeal did not reflect whether the trial court apportioned fees between assumpsit and non-assumpsit claims, appellate court could not effectively review whether trial court abused its discretion in awarding attorneys’ fees as it did; thus, case vacated and remanded for redetermination. 107 H. 106, 111 P.3d 1 (2005).

Where allowing insurer to seek attorney’s fees under this section would have contravened the attorney’s fee award scheme set forth in §431:10C-211, trial court did not abuse its discretion in denying insurer’s motion for attorney’s fees and costs. 109 H. 537, 128 P.3d 850 (2006).

Where underlying appeal involved an adjudication of rights in which no monetary liability was in issue, the twenty-five per cent limitation was inapplicable to the case. 110 H. 217, 131 P.3d 500 (2006).

Where plaintiff’s allegations were that engineering firm’s and State’s negligent failure to protect plaintiff from “dangerous and/or defective conditions” legally caused plaintiff’s injuries, plaintiff’s claims sounded in tort, not assumpsit; thus, plaintiff was not entitled to attorney’s fees under this section. 110 H. 269, 132 P.3d 378 (2006).

Plaintiff entitled to attorneys’ fees under this section where plaintiff successfully defended claim of breach of contract; trial court did not abuse discretion in awarding attorneys’ fees where amount was well within twenty-five per cent of the judgment, was well-documented, and trial judge had personal knowledge of the complexity of the litigation and the nature and quality of the legal services rendered before it. 111 H. 286, 141 P.3d 459 (2006).

Trial court did not abuse discretion in denying defendants’ motion for attorneys’ fees under this section where lien application was brought pursuant to the mechanic’s lien statute, §507-47, and, as such, was not a common law action, and the action was for the attachment of a mechanic’s lien to the subject property, not for damages based upon the underlying contract; thus, the action was not in the nature of assumpsit. 111 H. 349, 141 P.3d 996 (2006).

Where plaintiffs’ claims for relief did not involve monetary damages based upon the non-performance of a contractual agreement for legal services between defendants and hotel operator, but primarily requested a declaration and injunction, the “essential character” of the action was not in the nature of assumpsit; thus, trial court abused its discretion in granting attorneys’ fees to defendants. 113 H. 251, 151 P.3d 732 (2007).

Where homeowner association was a nonprofit organization and the covenants in its first declaration ran with the land, it was a “planned community association” for purposes of this section; thus, association was not subject to the twenty-five per cent cap on its attorneys’ fees incurred on appeal. 114 H. 361, 162 P.3d 1277 (2007).

Based on the plain language of this section and, because the amount the jury awarded terminated attorney plaintiff differed from the amount sued for, the amount of attorneys’ fees awarded varied when the prevailing party changed from plaintiff to defendant law firm; as law firm limited its fee request to its assumpsit claim, the calculation of which was dictated by this section, it was unnecessary for the trial court to apportion fees between assumpsit and non-assumpsit claims; and, as there was adequate documentation, trial court did not abuse its discretion in granting law firm’s motion for attorneys’ fees. 117 H. 92, 176 P.3d 91 (2008).

The plain language of §658A-21(b) and its related commentary from the Uniform Arbitration Act established that awards of attorneys’ fees can be valid and authorized based on a party agreement, even if the resulting award exceeds the twenty-five per cent of the judgment limitation included in this section. 123 H. 476, 236 P.3d 456 (2010).

Section did not apply to plaintiff’s suit for specific performance, but applied to defendant’s counterclaim in the nature of assumpsit. 2 H. App. 400, 633 P.2d 556 (1981).

Under circumstances, attorney’s fees should have been awarded in accordance with this section rather than §607-17. 2 H. App. 551, 634 P.2d 1052 (1981).

Action in the nature of reformation does not fall within scope of this section. 3 H. App. 101, 641 P.2d 1361 (1982).

Where contract fully performed, action on contract for sum certain is “in the nature of assumpsit”. 3 H. App. 624, 656 P.2d 1353 (1983).

When calculating “amount sued for”, life expectancy tables and present value of future benefits may be used. 4 H. App. 455, 667 P.2d 844 (1983).

Error to award fees based on punitive damages counterclaim. 5 H. App. 174, 683 P.2d 833 (1984).

Action to collect on judgment rendered in proceeding to confirm arbitrator’s award not an assumpsit action. 5 H. App. 315, 690 P.2d 1310 (1984).

Under circumstances, attorney’s fees should have been awarded in accordance with this section rather than §607-17. 5 H. App. 581, 704 P.2d 930 (1985).

Computation of fees on complaint and counterclaim; exclusion where fees based on duplicative claim. 5 H. App. 603, 705 P.2d 67 (1985).

In making attorney’s fee awards under §666-14 and this section, the trial court must designate the specific amount awarded pursuant to each statute to prevent duplicative awards and permit effective appellate review of awards. 85 H. 501 (App.), 946 P.2d 609 (1997).

Landlord entitled to include partial rental payments received from tenant after landlord initiated suit as part of judgment for purpose of computing attorney’s fees under this section. 85 H. 501 (App.), 946 P.2d 609 (1997).

Pursuant to this section, attorney’s fees may be awarded under a sublease as a sublease is contractual in nature and this section authorizes such an award in all actions on “contract[s] in writing that provides for an attorney’s fee”. 85 H. 501 (App.), 946 P.2d 609 (1997).

The amount of the judgment upon which attorneys’ fees are calculated under this section should include prejudgment interest. 85 H. 501 (App.), 946 P.2d 609 (1997).

Under §666-14, a landlord may, incident to a summary possession action, seek attorney’s fees attributable to the summary possession action which are in addition to, but not duplicative of, any fees awarded under this section. 85 H. 501 (App.), 946 P.2d 609 (1997).

Section places a twenty-five per cent maximum total combined limit that can be taxed against a losing party by both the trial and appellate courts. 87 H. 350 (App.), 956 P.2d 1282 (1998).

Where counterclaim clearly sued for the amount of additional storage fees to be incurred for detained vehicle, twenty-five per cent of this amount was properly included in the amount prevailing counterclaim defendant was entitled to in attorneys’ fees under this section. 97 H. 47 (App.), 33 P.3d 543 (2001).

Where attorney, as an individual, was not involved in the appeal and did not conduct “his own case”, but was involved in the case as trustee and as the attorney for the trustee, the court could not award attorney fees to an attorney for representing a trustee when the same person was both the attorney and trustee as (1) there was the problem of double recovery (of trustee fees and attorney fees) and (2) there was the problem presented by rule 1.7 of the Hawaii rules of professional conduct–the general rule regarding conflict of interest. 112 H. 231 (App.), 145 P.3d 774 (2006).

Trial court did not err in awarding attorneys’ fees based on the unjust enrichment award where plaintiffs’ unjust enrichment claim was appropriately tried to the court (with the jury sitting in an advisory capacity), thereby essentially ruling that the action was an equity action within the realm of assumpsit. 116 H. 42 (App.), 169 P.3d 994 (2007).

Where the circuit court granted plaintiff’s complaint for declaratory judgment, which effectively stopped defendants from continuing with their plans, plaintiff was the prevailing party and was properly awarded attorneys’ fees and costs. 123 H. 500 (App.), 236 P.3d 1236 (2010).

A law firm that prevails in a court action to collect fees from a client may also be awarded attorney fees under this section for the work of an attorney employed with the law firm who represents the firm in the collection action. 124 H. 187 (App.), 238 P.3d 714 (2010).

Based on the facts and issues raised in plaintiff’s complaint, the nature of the grievance, and the relief sought, where the essential character of the underlying action was one of equitable contribution under §483-2 and was not an action in the nature of assumpsit under this section, the circuit court abused its discretion in awarding attorney’s fees and costs to defendants under this section. 128 H. 366 (App.), 289 P.3d 1002 (2012).

Cited: 654 F. Supp. 2d 1142 (2009); 2 U.S.D.C. Haw. 210, 213 (1904); 5 H. 283, 284 (1885); 35 H. 907, 910 (1941); 37 H. 295, 304 (1946); 48 H. 306, 328, 402 P.2d 440 (1965); 49 H. 241, 243, 413 P.2d 242 (1966).

Discussed: 853 F. Supp. 2d 1031 (2011); 871 F. Supp. 2d 1040 (2012); 9 H. App. 591, 855 P.2d 858 (1993).

Mentioned: 76 H. 487, 879 P.2d 1070 (1994).

Referred to: 49 H. 578, 586, 587, 615, 426 P.2d 298 (1967).