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Winn v. Amerititle

November 24, 2010

KERRY WINN, PLAINTIFF,
v.
AMERITITLE, INC., AN OREGON CORPORATION, DEFENDANT.



The opinion of the court was delivered by: Honorable B. Lynn Winmill Chief U. S. District Judge

MEMORANDUM DECISION AND ORDER

INTRODUCTION

The Court has before Defendant Amerititle, Inc.'s Motion for Attorney Fees (Dkt. 31). The Court will award $51,352.50 in fees.

BACKGROUND

In early December 2005, Royce Monson entered into a vacant land real estate purchase and sale agreement with Dee and Yoriko Fuhriman, and Tamarack North, Inc. for approximately 101 acres of land in Valley County, Idaho. Monson planned to purchase the land and then either flip the property or entitle and develop the property with Lori McDonald, Jesse Winn, and, the plaintiff, Kerry Winn. The Fuhrimans agreed to convey the property to Monson for $5.6 million provided that Monson pay $100,000 as an earnest money deposit, which was to be held in escrow by Amerititle, Inc.

Kerry Winn agreed to provide the $100,000 in non-refundable earnest money, and Amerititle provided him with information about how to wire the money to the escrow account. Satisfied with Amerititle's wiring instructions, Winn wired $100,000 to Amerititle, which then dispersed the funds to Tamarack North.

The deal fell apart, and Kerry Winn sued Amerititle, alleging that Amerititle breached the escrow agreement, breached its fiduciary duties as an escrow agent, and acted negligently by dispersing the earnest money solely to Tamarack North, rather than jointly to Yoriko Fuhriman and Tamarack North.

Kerry Winn and Amerititle filed cross-motions for summary judgment. On August 11, 2010, the Court entered an order denying Winn's motion for summary judgment and granting Amerititle's motion for summary judgment (Dkt. 29). Judgment was entered in favor of Amerititle on August 12, 2010 (Dkt. 30). Amerititle now seeks attorney fees.

ANALYSIS

Idaho law governs the award of attorney fees in this matter because federal courts must follow state law as to attorney fees in diversity actions. See Interform Co. v. Mitchell, 575 F.2d 1270, 1280 (9th Cir. 1978) (applying Idaho law). Amerititle requests attorney fees in the amount of $51,352.50 pursuant to Idaho Code § 12-120(3), Idaho Code § 12-121, and Rule 54(e) of the Federal Rules of Civil Procedure. Plaintiff Kerry Winn objects.

1. Idaho Code § 12-120(3)

Idaho Code § 12-120(3) provides that the prevailing party "shall be allowed" an award of reasonable attorney fees in any civil action to recover on... "any commercial transaction." The statute defines the term "commercial transaction" to mean "all transactions except transactions for personal or household purposes." I.C. § 12-120(3) (1998). " Under Idaho Code § 12-120(3), an award of attorney fees is appropriate where "the commercial transaction is integral to the claim, and constitutes the basis upon which the party is attempting to recover." Blimka v. My Web Wholesaler, LLC, 152 P.3d 594 (Idaho 2007) (citing Brower v. E.I. DuPont De Nemours and Co., 792 P.2d 345, 349 (Idaho 1990)).

The Idaho Supreme Court has held that Idaho Code § 12-120(3) "neither prohibits a fee award for a commercial transaction that involves tortious conduct ... nor does it require that there be a contract." Blimka, 152 P.3d 594. However, the commercial transaction under Idaho Code § 12-120(3) must be between the parties. See e.g., BECO Construction Company, Inc. v. J-U-B Engineers, Inc., 184 P.3d 844, 851 (Idaho 2008).

There is no question that Amerititle is the prevailing party. Winn, however, argues that the dispute did not arise out of a commercial transaction and thus Amerititle cannot recover fees pursuant ...


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