Kollander v. Kollander

          Appeal from the Superior Court of the State of Alaska, Third Judicial District, Anchorage, No. 3AN-90-06548 CI, Mark Rindner, Judge.

          Stephen Merrill, Anchorage, for Appellant.

          David W. Baranow, Law Offices of David Baranow, Anchorage, for Appellee.

          Before: Stowers, Chief Justice, Winfree, Maassen, Bolger, and Carney, Justices.

          OPINION

          CARNEY, Justice.

         I. INTRODUCTION

         Jean Kollander filed suit in 2012 to reopen a qualified domestic relations order (QDRO) entered pursuant to her 1991 divorce. The superior court dismissed the suit based on laches and awarded full attorney's fees to her former husband, Daryl Kollander. Jean appealed. We affirmed the superior court's substantive decision but remanded for recalculation of attorney's fees in accordance with Alaska Rule of Civil Procedure 82. On remand the superior court awarded attorney's fees to Daryl based on 60% of his reasonable actual attorney's fees. The court also issued an Alaska Rule of Civil Procedure 11 sanction against Jean's attorney, Stephen Merrill, for filing additional motions after remand that were not well-grounded in fact or based on a reasonable inquiry into the facts. Jean now appeals the attorney's fee award and the Rule 11 sanction against Merrill. We conclude that the superior court did not abuse its discretion either in determining the attorney's fee award or in sanctioning Merrill under Rule 11.

         II. FACTS AND PROCEEDINGS

         Daryl and Jean Kollander married in 1969 and divorced in 1991. The QDRO entered pursuant to their divorce granted each party a share of the other's retirement benefits. Daryl has been receiving monthly payments from Jean's pension since 2001. When Daryl retired in 2007 the federal Office of Personnel Management informed Jean that she would receive her share of Daryl's pension as a lump sum of $22, 459.81, paid in monthly installments of $ 1, 796.50. Jean received the final payment in 2008.

         In 2012 Jean moved to reopen the QDRO and to hold Daryl in contempt for failing to pay her the marital share of his retirement benefits because she received a lump sum instead of lifetime payments from Daryl's pension. The superior court ruled that Jean's suit was barred by laches, and it awarded full attorney's fees to Daryl. Jean appealed the decision to this court. In Kollander v. Kollander (Kollander I) we affirmed the superior court's application of laches but, finding the full attorney's fee award unsupported by the record, remanded for recalculation of the attorney's fee award in accordance with Rule 82.^[1]

          In June 2014 the superior court held a hearing on remand to reassess the attorney's fee award. At the hearing Daryl asked for enhanced attorney's fees, arguing that the case involved complex issues including laches and "an obscure conspiracy, " and that a significant amount of money was at stake. He argued that "all of [Jean's] claims were patently unreasonable" and that Jean had engaged in "vexatious or bad faith conduct" such that the court could award full attorney's fees.

         Jean responded by first arguing that the case was disposed of without a trial and so should be subject to a 20 percent default fee under Rule 82, rather than a 30 percent default fee.^[2] She next argued that her claim was reasonable and that our decision on the merits in Kollander I was "plain wrong." She finally argued that the attorney's fee award should be reduced because an enhanced fee award "would certainly deter a claimant... who brings a case, no doubt about it, " although she was unable to articulate why she believed that was the case.

         The superior court found that Daryl remained the prevailing party and determined that it would apply the Rule 82 schedule for a claim contested with trial. The court departed from the default attorney's fee based primarily on its assessment of the reasonableness of the parties' claims and defenses, pursuant to subsection 82(b)(3)(F). The court found Jean's claims unreasonable due to the lack of evidence to support her arguments and the amount of time that had passed before she brought her claims. Because Jean also denied the legitimacy of this court's decision on appeal and attempted to re-argue the merits of the case, the superior court determined that her argument on remand was also unreasonable. The court found Daryl's defense of laches reasonable given the 21-year period between the initial divorce decree and the present claim. The court awarded 60% of Daryl's full and reasonable attorney's fees, including those fees incurred in the first round of litigation and those incurred on remand, but not those incurred in the first appeal to this court.

         In May 2015 Daryl's attorney, David Baranow, submitted his fee and cost accounting to the superior court. He listed $8, 190.01 for the initial 2012 litigation and $2, 062.40 for services provided on remand, and accordingly requested a 60% fee award of $6, 061.50. Two days later Merrill sent Baranow an email criticizing the court's treatment of the case and implying that Jean had moved or would move to Central America to avoid paying Daryl. Merrill followed this email with another in June 2015, personally disparaging Baranow. After conferring with Bar Counsel, Baranow provided the court a copy of this correspondence "as a matter of... ethical disclosure."

         In June 2015 Jean filed a motion for extension of time to reply to Daryl's attorney's fee accounting; Daryl opposed the motion. Jean then filed a motion to void the attorney's fee award, complaining that Baranow's submission to the court of Merrill's emails "foul[ed] this record by trying to jar this Court's objectivity and independence of judgment with a controversial pleading unknown to the law." At a status hearing scheduled after Jean's motion was submitted, she requested that the assigned judge either void the attorney's fee award or recuse himself. The judge found no basis for recusal and denied Jean's motion, noting that the motion "border[ed] on the frivolous." Another superior court judge affirmed his decision.

         Jean then moved for the entry of contempt citations and show cause orders against Daryl and Baranow. She asserted that Daryl had perjured himself at trial by stating that he did not receive a disputed home-closing document from Wells Fargo Bank. The court investigated these allegations and found that the document, which Jean claimed Daryl had obtained from Wells Fargo prior to a 2012 evidentiary hearing, was actually provided to Daryl and Baranow by Merrill himself: Merrill had attached the document to one of his reply briefs. The court therefore denied Jean's motions and ordered Merrill to show cause why he should not be sanctioned under Rule 11 for submitting motions based on untrue information.

         At an August 2015 show cause hearing, for which Merrill failed to appear, the court found that Merrill should have known that his statements regarding the home document were "factually . . . incorrect, untrue, [and] false." Having concluded that Merrill violated Rule 11(b)(3), which requires factual claims in court filings to have evidentiary support, the court also found that the motions were submitted for an "improper purpose" - to increase litigation costs - in violation of Rule 11(b)(1). As a sanction for the Rule 11 violation, the court ordered Merrill personally to pay the full attorney's fees incurred in responding to the motions.

         On August 31 Merrill moved to reopen the Rule 11 sanction proceedings, stating that he was outside of Alaska for depositions and had not received the show cause order until after the August hearing. The court granted his request and set another hearing for October 2015.

         Merrill failed to appear again for the October hearing. The court's findings at the October hearing mirror the findings from the August hearing. Because Merrill had failed to review his own case file before submitting the motions, the superior court found that he did not make a reasonable inquiry into the factual basis of the motions. The court said that had Merrill reviewed his case file at any time before filing the motions to hold Daryl and Baranow in contempt, Merrill would have discovered the lack of evidentiary support for the motions. The court therefore reiterated its order requiring Merrill to pay Baranow the full amount of attorney's fees incurred in responding to the motions.

         Jean now appeals the award of enhanced attorney's fees under Rule 82 and the Rule 11 sanction imposed against Merrill.^[3]

         III. STANDARDS OF REVIEW

         "We review awards of attorney's fees for abuse of discretion and will reverse 'if the award is arbitrary, capricious, manifestly unreasonable, or improperly motivated.' "^[4] In granting an attorney's fee award, "[t]he determination of which party is the prevailing party is ... subject to the trial court's discretion and is reviewable only for abuse of discretion."^[5]

         "We review the award of sanctions under Rule 11 for abuse of discretion"^[6]and will "review[] all factors relevant to the issue of whether the attorney's inquiry into facts and law was reasonable under an abuse of discretion standard."^[7]

         IV. DISCUSSION

         A. Legal Background

         1. Alaska Rule of ...