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In re Beckley

United States District Court, D. Idaho

June 4, 2014

In re: WAYNE N. BECKLEY and WENDY M. BECKLEY, Debtors.
v.
WAYNE NILES BECKLEY, Defendant/Appellant. DALE GOODWIN; JOHN & NANCY LINDBERG; and ANN WALCH Plaintiffs/Appellees,

MEMORANDUM DECISION AND ORDER

B. LYNN WINMILL, District Judge.

INTRODUCTION

Before the Court is plaintiffs' Motion for Attorney Fees. (Dkt. 14). For the reasons explained below, the Court will grant the motion in part and deny it in part.

BACKGROUND

In 2006, plaintiffs lent several hundred thousand dollars to Bald Mountain, LP. Bald Mountain defaulted on the loan, and in August 2010, this Court entered a default judgment of nearly $426, 000 against Bald Mountain and its general partners, including defendant Wayne Beckley. See Default Judgment, Case No. 1:09-cv-594-BLW, Dkt. 32. Beckley filed a Chapter 7 bankruptcy petition, and plaintiffs commenced an adversary proceeding to protect their default judgment. The bankruptcy court granted summary judgment in plaintiffs' favor, which prompted this appeal. On appeal, this Court affirmed the bankruptcy court's rulings. Plaintiffs now seek to recover attorneys' fees incurred on appeal.

ANALYSIS

1. Entitlement to Attorneys' Fees

Plaintiffs rely on Idaho Code § 12-120(3), along with the attorneys' fee provision in the underlying promissory notes, to support their request for a fee award. Section 12-120(3) provides that the prevailing party in any civil action to recover on a note is entitled to a reasonable attorneys' fee. Idaho Code § 12-120(3). In this case, plaintiffs initially commenced a civil action to recover on their notes, and the notes contain the following attorneys' fee provisions:

"If any default is made hereunder... Maker further promises to pay all costs of collection when incurred, including but not limited to reasonable attorneys' fees, costs and expenses incurred by Holder hereof in connection with security the payment [sic] of this Note, or any such default in any action or other proceeding brought to enforce any of the provisions of this Note.

Case No. 1:09-cv-594-BLW, Sept. 15, 2006 Note, Ex. B to Compl., Dkt. 1 at 13, § 7; see also Exs. C-E (containing identical provisions).

"Contractual provisions for payment of attorney fees are enforceable in Idaho." Shurtliff v. N.W. Pools, Inc., 815 P.2d 461, 466 (Idaho Ct. App. 1991). Thus, because plaintiffs prevailed on their action to recover on a note, they are entitled to recover a reasonable attorneys' fees, including fees they incur in their ongoing collection efforts. See id.; Idaho Code § 12-120(5).

This case is procedurally unusual because plaintiffs are asking this Court - which is sitting as an appellate tribunal - to award attorneys' fees. Neither side has submitted any briefing on this issue. Instead, both sides implicitly assume that the Court is empowered to award fees on appeal. Given the lack of briefing - and the lack of any objection by the defendant - the Court will assume without deciding that it may award attorneys' fees incurred on appeal. See Fed.R.Bankr.P. 8014 (stating, in part, that "costs shall be taxed against the losing party on appeal"); Idaho Code § 12-120(3) (providing that the attorneys' fee awarded to a prevailing party shall be "taxed and collected as costs").

Substantively, Beckley does not dispute that plaintiffs are the prevailing party. Instead, he generally argues that the Court should decline to award attorneys' fees because there was a "reasonable basis" for the appeal and because the appeal "was warranted to clarify controlling law." Response, Dkt. 17, at 2. But Beckley has not discussed the fee provisions in the notes. Nor has he discussed legal authority governing fee awards. As such, ...


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