Saturday, November 23, 2013

Fee Shifting In The Wind?

The general rule is that parties in civil litigation have to pay their own attorney; this is what is known as the American Rule.  Yes, sometimes contracts require the losing party to pay the winning party's attorneys' fees should a dispute arise under that contract.  Yes, sometimes judges order one party to pay another party's attorneys' fees based upon a violation of Wis. Stat. (Rule) § 802.05 or for discovery abuse pursuant to Wis. Stat. (Rule) § 804.12.  Most significantly for the purposes of this post, certain consumer statutes require courts to award a prevailing party reasonable attorneys' fees.  These statutes include Wis. Stat. § 100.18 and Wis. Stat. § 100.20.  The purpose of this "fee shifting" is to encourage attorneys to take these cases and to deter sellers from defrauding buyers.  See Stuart v. Weisflog's Showroom Gallery, Inc., 2008 WI 22, 308 Wis. 2d 103, 746 N.W.2d 762; First Wis. Nat'l Bank v. Nicolaou, 113 Wis. 2d 524, 335 N.W.2d 390 (1983).  I like these statutory causes of action, and I plead them whenever I can on behalf of my defrauded clients.

However, I recognize that the American Rule generally applies in civil litigation.  For example, I know that I cannot seek reasonable attorneys' fees on behalf of clients whose use and enjoyment of their property has been interfered with by the actions of another.  These are the nuisance cases that I discussed in a previous post.  Some of our clients claim that their property has diminished in value as the result of the opening of an Aldi in their neighborhood.  Others claim that their property has diminished in value as the result of a gas pipeline or a Superfund site nearby.  Plaintiffs with such claims have to pay their attorney even if they prevail.

Given my background in pursuing diminishment in value claims on behalf of property owners, I was very interested to hear about a new law proposed by Senator Lasee.  Senate Bill 167 would entitle property owners to reasonable attorneys fees if they could prove that they were damaged by a wind energy system.  The law also entitles owners of property near wind turbines to recover for emotional damages, pain and suffering, and relocation expenses.

If you guessed that I favor this legislation, then you guessed incorrectly.  I don't dispute that wind turbines negatively affect property values.  Then again, gas pipelines and Superfund sites also negatively affect property values and have been linked to deadly health problems, including cancer.  Why should those who live near wind turbines recover reasonable attorneys' fees while property owners damaged by other nuisances are left out in the cold?  Furthermore, I see no public policy justification for this exception to the American Rule.  Reasonable attorneys' fees are recoverable under Wis. Stat. §§ 100.18 and 100.20 because we want to deter fraud and other deceptive practices.  Theft by fraud is a criminal offense.  In contrast, there is nothing illegal about wind turbines.  Of course, this proposed law would encourage attorneys (including yours truly) to take these cases, but that could justify any fee shifting statute.  Where's the NEED to encourage attorneys to take these cases?

Please feel free to comment below, as I would reconsider my initial opinion if someone justifies fee shifting in these cases.

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