Brandt Fees: Great Illustration On How To Apportion Fees Correctly

 

Fourth District, Division One Decision Shows the Right Way to Do It!

     In our category “Cases: Insurance,” we have highlighted the Brandt fees apportionment issue for insureds obtaining fee awards in their favor for purposes of recouping benefits under their insurance policies. The next case is a good illustration on how to properly posture recovery of Brandt fees at the trial court level so as to preserve the award on appeal.

     Major v. Western Home Ins. Co., Case No. D050479 (4^th Dist., Div. 1 Jan. 6, 2009) (certified for publication) involved a situation where an insured obtained a jury verdict of $1.3 million in an insurance bad faith case, $189,000 of which represented an award of attorney’s fees under a Brandt theory. (Note—the jury awarded Brandt fees in this case.) Insurer appealed, but lost upon review.

     Here is the showing that was sustained on appeal in favor of the insured—containing great “pointers” on how to correctly present a Brandt fee award for approval:

· Insured’s counsel reviewed the entire file, carefully allocating time devoted to prosecution of the complaint against the insurer versus the time that could not be segregated on other claims;

· Insured’s counsel identified and requested hourly billing rates lower than rates that courts had awarded in a recent insurance bad faith case;

· Insured’s counsel had not billed for at least 200 hours in trial preparation and trial work; and

· Insured’s counsel reduced costs in half for purposes of allocating costs only against the Brandt-recoverable claim.

     If you have not guessed it already, the appellate court found that this showing constituted substantial evidence to affirm the award of Brandt fees in favor of the insured. (Slip Opn., at p. 25.)

     Although we do not comment on the merits of most opinions, we hope that this decision demonstrates how insureds can recover Brandt fees from a jury (even after a hard fought appeal). We do believe that prudent apportionment practices employed on behalf of the insured increase the chances of success at all judicial levels, a lesson reinforced by the result in Major.