In a recommended decision, a United States magistrate determined the insurer was entitled to attorney fees under Hawaii's assumpsit statute, Haw. Rev. Stat. 607-14. See Deguchi v. Allstate Ins. Co., 2008 U.S. Dist. LEXIS 73072 (D. Haw. Sept. 23, 2008).
A prior post discussed the facts of Deguchi. Briefly, Allstate insured a vessel which sank under suspicious circumstances. Allstate denied coverage because the insureds failed to: complete their oral examination under oath; produce documents relating to the purchase and financing of the vessel; produce documents relating to their personal finances; and produce phone records from the night the vessel sank.
The insureds filed suit, alleging four counts, including breach of contract and bad faith. In April 2008, the District Court granted Allstate's motion for summary judgment on all of the insureds' claims.
Allstate then moved for attorney fees and costs pursuant to Haw. Rev. Stat. 607-14. The magistrate agreed Allstate was entitled to fees for the breach of contract claim, but not the bad faith or other claims. Under Hawaii law, an award of attorney fees must be apportioned between assumpsit and non-assumpsit claims. Where, however, it is impossible to separate assumpsit from non-assumpsit claims, allocation is not required.
Here, with the exception of time devoted solely to the bad faith claim, Allstate's work appeared to have been devoted to the action as a whole. An appropriate award, therefore, was 75% of the time attributable to the action as a whole.
Turning to the amount of fees to be awarded, the rates of $140 and $115 per hour were reasonable. Duplicate billing for time spent at the same meeting was deleted. Further, section 607-14 limited the award of attorney fees to 25% of the judgment. Because Allstate, the Defendant, prevailed, the fee award was "assessed . . . upon the amount sued for . . . ." Haw. Rev. Stat. 607-14. The insureds' Complaint did not specify the amount of damages they sought. But in exempting the case from the Court Annexed Arbitration Program, the Complaint stated that the jury award would likely exceed $150,000. Therefore, the magistrate's recommended award of attorney fees was within 25% of this amount.
