Posted: December 17, 2015
Rules of Civil Procedure
URCP 009. Pleading special matters. Amend. Removes the paragraph regarding a petition to renew a judgment. The process to renew a judgment is governed by proposed Rule 58C and the Judgment Renewal Act. Adopts much of the style and grammar of the federal rule.
URCP 026.01. Disclosure and discovery in domestic relations actions. Amend. Amends the disclosure deadlines to conform to Rule 26.
URCP 026.02. Disclosures in personal injury actions. Amend. Corrects a reference to amended Rule 9.
URCP 041. Dismissal of actions. Amend. Removes the provision for ruling against a plaintiff for failure to prove a right to relief, a similar but broader provision having been added to Rule 52, as in the federal rules. Adopts much of the style and grammar of the federal rule.
URCP 054. Judgment; costs. Amend. Establishes a process to add attorney fees and costs to a judgment.
URCP 058A. Entry of judgment; abstract of judgment. Amend. In conjunction with amendments to rule 4 of the Utah Rules of Appellate Procedure, establishes a new policy on time in which to appeal a judgment when a motion for attorney fees has been filed. A motion for attorney fees would have the same effect as a motion under rules 50, 52, and 59 of the Rules of Civil Procedure, extending the time in which to appeal to 30 days after the order on the motion, effectively overturning ProMax Development Corp. v. Raile, 2000 UT 4, 998 P.2d 254.
URCP 058C. Motion to renew judgment. New. In conjunction with the Judgment Renewal Act and the amendment to Rule 9, describes the process for renewing a judgment.
URCP 073. Attorney fees. Amend. Modifies the process for claiming attorney fees. Adopts many features of FRCP 54(d).
URCP 058C
My office has been getting varying and inconsistent rulings regarding how interest is to be treated in a renewed judgment. Some judges allow contractual interest rates to carry over while others require the U.C.A. 15-1-4 statutory rates carrying forward. Regarding the U.C.A. 15-1-4 rates, there is also a discrepancy in whether the rate from the year the judgment originally entered or the year when the judgment renews should apply. It would be nice to have some guidance on this issue in the rule itself.
Regarding URCP 73, the fee schedule [tentatively (f)] should be updated.
For instance, the allowed $250 amount for the range for 0 to 1,500, should be eliminated.
At minimum, we should use the $325 amount (if not more) and extend the range for judgment amounts of 0 to 2,000. It could match Court Filing Fees for suits $2000 or less.
Rule 9:
ll. 2-8: Consider replacing with the language of Fed. R. Civ. P. 9(a). The only thing that is not in the federal language is the last sentence, and that can either be added to the language or simply deleted as self-evident and unnecessary.
ll. 7-8, 27-28, & 45-46: Consider deleting the last sentence of each; it is self-evident that these issues would be determined at trial, making these sentences unnecessary. If needed, a note could be added that issues of capacity, conditions precedent, and statutes of limitation should be decided at trial along with other claims and defenses.
l. 8: Change “shall” to “must” or “may”.
ll. 9-18: Consider renumbering (b) and (c) as (b)(1) and (b)(2), as they are both about unknown parties. I suggest the following headers:
“(b) unknown parties”
“(b)(1) designation”
“(b)(2) Descriptions of interest in quiet title actions”
l. 9: Replace “defendant” with “party”.
l. 10: Consider replacing “may” with “must”.
ll. 11 & 12: Delete “or proceeding” in both lines as unnecessary.
l. 11: Replace “name, provided that when” with “name. When”.
l. 13: Replace “corrected” with “amended”— the term corrected does not have any meaning in the rules in referring to pleadings, and it creates an ambiguity as to whether the party should go through the amendment process of Rule 15 or some other process. Changing the term to amended clarifies that ambiguity.
l. 14: Change “a party” to “one or more parties”— it corresponds better to the phrase “may describe the unknown persons” in line 16.
l. 45: Delete “If the allegation is denied,” as the statute of limitations is a defense, and defenses are not admitted or denied under Rule 8 unless the court specifically orders.
l. 47: Replace “statute of this state, or an ordinance of any political subdivision” with “statute of this state, an ordinance of any political subdivision”, as the phrases are part of a series with “a right derived from a statute or ordinance”.
ll. 47-48: Consider replacing “statute of this state, or an ordinance of any political subdivision” with “statute or ordinance”. First, the only information this gives us is that statutes are enacted by the state and ordinances by political subdivisions, and I don’t know that this information adds anything. Also, I’m not sure whether other states’ private statutes or ordinances are enforceable in Utah courts, but regardless, I would like to have a party pleading an out-of-state statute be required to give the same information as a party seeking to enforce a Utah private statute.
l. 50: not sure whether it should be “must” or “will”.
ll. 65-79: There are several problems with this provision:
First, a non-party’s residential address and personal telephone number is classified as a private record under UCJA 4-202.02(4)(K). This information should therefore not be included in a pleading or notice filed with the Court, but rather should be included with a party’s disclosures.
Second, there is a problem with the sentence “The court, upon motion and for good cause shown, may permit a party to file the information specified in subsection (l)(1) after the expiration of any period permitted by this rule, but in no event later than 90 days before trial.” As there does not appear to be any “period permitted by this rule” to expire, it is ambiguous whether a party seeking to allocate fault that did not include that defense in its answer must seek to amend its answer to add the defense under Rule 15 like any other defense, or whether it may file a supplemental notice without seeking leave of the court.
Third, this rule conflicts with 26(c)(5), which requires a defendant in a personal injury action (but no other action) to disclose the information required by Rule 9(m). As 9(m) currently requires the information to be included in the answer or supplemental notice, this does not make sense.
To solve these problems, I would recommend changing the rules as follows:
Replace Rule 9(m) with—
9(m) Allocation of fault.
(m)(1) A party seeking to allocate fault to a non-party under Title 78B, Chapter 5, Part 8 must affirmatively state the following in a responsive pleading under Rule 8(c):
(m)(1)(A) a description of the factual and legal basis on which fault can be allocated; and
(m)(1)(B) the non-party’s name. If the party does not know the name of the non-party, it must state that fact and provide any other information known or reasonably available to the party identifying the non-party, such as the non-party’s relationship to known parties or non-parties, the non-party’s employer, or the non-party’s business address, business telephone number.
(m)(2) A party may amend its responsive pleading to state the information required by paragraph (m)(1) under Rule 15(a). A motion to amend a pleading to state the information required by paragraph (m)(1) must be filed no less than 90 days before trial.
(m)(3) A party must not seek to allocate fault to a non-party except by compliance with this rule.
Add to Rule 26(a)(1)(A):
26(a)(1)(A)(iii) each non-party identified under Rule 9(m)(1).
Delete Rule 26.2(c)(5).
l. 67: Replace “shall” with “must”.
ll. 71-72: Consider replacing “If the identity of the non-party is unknown, the party shall so state.” with “If the party does not know the name of the non-party, it must state that fact.”
l. 72: Replace “shall” with “must”.
l. 79: Replace “may not” with “must not”.
Rule 54:
ll. 21-26: Paragraphs (d)(2) and (d)(3) suggest that a memorandum of costs cannot be ruled upon until after a judgment is entered. When considered with Paragraph (e), this means that there will be an amended judgment in nearly every case. I would recommend changing the proposed rules so that they run from the recording of the verdict or decision that provides the basis for entry of judgment rather than the judgment itself, or at least provide the prevailing party with the option of filing a memorandum of costs before the entry of judgment without tolling the opposing party’s time to respond to the memorandum until after the entry of the judgment. Perhaps change “within 14 days” on line 21 to “not later than 14 days” to mirror the language of Rule 59, see Hudema v. Carpenter, 1999 UT 290, ¶ 18, 989 P.2d 491 (Utah App. 1999) (holding that “not later than 10 days after the entry of judgment” specifically allows a party to file before the entry of the judgment), and delete (d)(3).
ll. 28-29: Consider deleting “to include the award in the judgment” as unnecessary—it makes the sentence hard to read, and it makes it ambiguous whether a party must amend a judgment to include costs and attorney fees or whether it can get an award in a separate order pursuant to Rule 7(j)(8).
l. 29: Add the word “prevailing” between “the” and “party”.
ll. 29-30: Replace “fees, and the court” with “fees. The court”.
Rule 58C:
ll. 2 & 10: Add the words “under Rule 7” between “motion” and “in”; delete paragraph (c).
URCP 26.1 Disclosure deadlines.
I like the change putting 26.1 disclosures on the same schedule as 26 and requiring the Respondent’s disclosures to be served regardless of the status of the Petitioner’s.
Rule 73:
The rule (or perhaps just the advisory committee note) may want to distinguish between a motion for attorney fees, which includes a full statement of grounds, affidavit, etc., and a subsidiary request for attorney fees pursuant to a motion, such as one made under URCP 11(c) or 37(a)(7)(K), or in response to a meritless or dilatory motion under UCA § 78B-5-825 (see Rohan v. Boseman, 2000 UT App 109, ¶¶ 36-40, 46 P.3d 753 (applying statute to motions)). I’m certain that the courts would not want parties filing separate motions for attorney fees (along with an affidavit of fees that would have to be revised) every time they sought fees in a motion or in response to a motion. In considering this, the committee may also want to consider whether URCP 7(n) is applicable to a nonmoving party’s request for attorney fees for the necessity of responding to a meritless or dilatory motion. Again, filing such a request as a separate motion would likely have the effect of unnecessarily multiplying the filings in the case, and the committee may want to nip it in the bud.
(The comments below refer to exhibits which can be downloaded at: https://www.dropbox.com/s/2qx2xsvay8ter37/rule73exhibits.pdf)
My name is Mark Olson. I’m a debt collection attorney and former chair of the collection section of the bar. I have no comments concerning the proposed changes to Rule 73 per se, but I would like to propose an additional change: that the Rule 73 fee schedule be revised to reflect increased costs since the last adjustment 13 years ago.
For some, the default fee schedule may be a quaint artifact, anachronistic and not worth considering. Most attorneys will rarely, if ever, use the schedule. However, the schedule is probably used in a majority of court filings, and for many collection attorneys, myself included, the schedule has become the default fee for their services. For that segment of the bar, keeping the schedule relatively up-to-date is vital to their livelihood.
HISTORY OF THE FEE SCHEDULE
In fact, the schedule was actually created with the collection bar in mind. The idea originated in 1991 by the Board of Circuit Court Judges to address several problems caused by the vast number of default judgments filed by collection attorneys. Those issues, presented to the Judicial Council as outlined in the minutes of their meeting on September 10, 1991 were: “1) The volume of cases makes it particularly burdensome for Circuit Court Judges to individually review and approve all of the affidavits in each case; 2) creates lack of uniformity between the judges; 3) creates an impediment toward consolidation, and 4) does not provide a way to challenge an attorney for the attorney fees sought.” (Exhibit A) The proposal, originally outlined in a memo by then Circuit Court Judge Michael Hutchings, went through a few iterations before finally being approved as a part of Rule 4-505 of the Code of Judicial Administration. (Exhibit B)
The schedule worked well for several years, not only for the courts, but for collection attorneys as well. The collection bar appreciates the consistent, simplified method of obtaining fee awards. Over time, however, inflationary pressures eroded the value of the schedule for those of us relying on the schedule. Many of us stopped using the schedule in favor of routinely filing fee affidavits. As the schedule lost effectiveness due to reduced utilization, the time came for it to be updated.
As then chair of the collection section, I took it upon myself to approach first the Judicial Council via letter, and subsequently the Rules Committee, where I appeared as a guest on March 26, 2003, to explain why the schedule needed to be updated. (Exhibit C)
The committee considered a variety of ways to revise the schedule, including making no changes whatsoever. One member’s thought was that over time inflation would increase the size of awards and move them up the schedule, thus resulting in higher fee awards. Such an approach, however, would do nothing for the vast number of small cases which would never reach the threshold principal where fees begin to increase; those would be stuck at $150 (then the fee schedule starting point).
In the end the committee decided to eliminate the first tier of the schedule, thus eliminating the tier awarding $150 at a principal balance of $750. The new schedule started with the former second tier: $250 in fees for cases with a principal balance below $2000. The new schedule and other changes went into effect on November 1, 2003.
TIME FOR AN ADJUSTMENT TO THE SCHEDULE
Now, 13 years later, the time has come once more to revise the fee schedule. As in 2003, so much time has passed since the last revision that the minimum fee no longer realistically reflects the cost of obtaining a default judgment. Not only that, several new requirements have been added to the process, making it more involved, time consuming and, thus, expensive to take a case to default judgment.
MORE WORK IS REQUIRED TO OBTAIN A DEFAULT JUDGMENT NOW COMPARED TO THE TIME OF THE LAST REVISION
Several additional steps have been added to the process since 2003, both formal and informal, making default judgments more costly.
First of all, we are now required to check a military database to ensure that the defendant is not in the military, and to file a copy of the results with a separate affidavit.
Many courts have also instituted their own various requirements. The Second District Court in Odgen, for example, requires us to prepare and file a Judgment Information Statement with every default judgment. Park City requires motions for entry of default judgment. Salt Lake requires separate affidavits detailing any collection fee included in the principal (in other jurisdictions we are able to include that statement in our complaints).
Most recent is an affidavit newly required by URCP 55(b)(1)(D). This rule requires the additional work of researching items for the affidavit, creating the affidavit, working with the affiant to obtain a signature, and ultimately electronically filing it with the other default documents. (The requirement can alternatively be satisfied via verified complaint, but that requires the same work.)
That brings us to the issue of electronic filing, which takes a lot more staff time than the old process. For example, instead of our prior practice of simply printing a complaint, having it served, and dropping it in the messenger box for delivery to court, it now involves printing hard copies for service, generating electronic pdf and rtf versions, saving and maintaining those copies, not to mention the cumbersome filing process.
THE COSTS OF DOING BUSINESS HAVE INCREASED
The costs of doing business have increased significantly since 2003, to the point that attorneys are once again beginning to file fee affidavits in lieu of seeking fees under the schedule. That trend is bound to continue, counteracting some of the very reasons the rule was created in the first place. The schedule must be updated; the question is how to quantify how much the schedule should be increased.
We could look to attorney salaries as one general measure of inflation in the practice of law. According to Bureau of Labor Statistics figures, mean attorney annual wages nationally have increased 22.96% from 2003 to 2014, the last year for which statistics are available. I tried finding similar data for Utah, but the closest I could find was for the category of “Professional, Scientific & Technical Services” wages in the Utah Department of Workforce Services Industry and Employment Wage database. Wages in that category have gone up 41.32% from 2003 to 2015.
How about hourly rates for attorney fees? More so than general attorney salaries, increases in hourly rates have a stronger correlation to the Rule 73 fee schedule. I can’t find any hard Utah data comparing rates over the period in question, but one corollary we can consider is the “Laffey Matrix,” a table of hourly attorney rates, broken down by years of practice, used by the District of Columbia Federal Court in making attorney fee awards. The Matrix has also been adapted for local use by several other courts around the country. Comparing Laffey Matrices from 2002-03 and 2015-16, the hourly rate for attorneys with 4-7 years of practice, for example, has risen 52.06%.
Now let’s break down what inflation has done to some of the biggest expenses for anyone trying to maintain a law practice, starting with wages. One place to look for data is the Employment Cost Index, a national measure of changes in prices paid for the compensation of labor. It shows that employment costs of all workers over all industries have risen 32.48% through June of 2015. To narrow the focus to what attorneys actually pay staff in Utah, I turned to Utah Workforce Services data. I found that “Administrative and Support Services” wages have increased 61.61% from 2003 to 2015.
Rent and health insurance premiums are two more major components of the cost of running a law practice, and they too have seen significant increases. According to a market analysis performed annually by Coldwell Banker Real Estate, office lease rates in Salt Lake City have risen 36.32% during the period in question. Health insurance premiums have also risen dramatically. I haven’t found and hard data covering limited to the years in question, but according to the Kaiser Family Foundation health insurance premiums increased 13.1% per year during the years 1999 to 2009.
I have faced similar cost increases of my own in running my practice, even though I have fought to keep costs down as much as possible. The average rate I pay paralegals and support staff has risen 27.01% from 2003 to the present. Firm paid health insurance premiums per employee have gone up a staggering 123.5 %. We have managed to keep our lease costs relatively in check, but only by moving twice in search of cheaper rent: first from downtown to the airport area, and then to our current home in West Valley City.
From these various statistics we see that attorney salaries and billing rates have gone up somewhere in the range of 23% to 52%. Major costs of doing business have gone up anywhere from 32% for salaries (based on averages for all workers in the US), 36% for rent in the Salt Lake valley, and something north of 100% for health insurance. During this time the schedule has not changed.
HOW THE SCHEDULE SHOULD BE REVISED
I propose one simple tweak: eliminate the first two lines of the schedule. That is essentially what was done 13 years ago (except that we would now remove two lines instead of one.) The result would be a fee of $400 for principal balances up to $2500, with the balance of the schedule remaining the same. This would represent an increase of 60% in the starting point of the schedule. That increase is generally in line with many of the statistical increases I have laid out, and is actually less than the 2003 fee increase of 66.7% ($150 to $250). That should also be adequate to compensate for the additional work now required to reach default judgment.
One thing to consider is that whatever increase is adopted, it is likely to remain the same for the next decade or more. We aren’t asking for annual adjustments, we can live with requesting a review ever decade or so. However, from the day it goes into effect the schedule will start depreciating and falling behind the current equivalent.
The existing schedule has been in effect long enough that its value to collection attorneys has eroded and some are starting to file fee affidavits. As more resort to affidavits reflecting their true fees, a greater burden will be imposed on the courts. The first update to the fee schedule was done some 11 years after the original. It has now been over 12 years since that last revision. My recommendation is that the Supreme Court adjust the current schedule by eliminating the first two tiers and bringing the starting point up to a more reasonable $400. Also, I would be happy to meet with the committee at its convenience to discuss this issue further.
Rule 73:
The Rule 73 chart for fees has not been updated in over 10 years and does not reflect the costs of doing business in 2016. Since Rule 73 was last updated the cost of doing business has risen greatly. Employee and healthcare costs have contributed greatly to this increase. Furthermore, the courts have imposed burdens on attorneys that simply did not exist 10 years ago. This includes additional effort for default affidavits, military service affidavits, collection fee affidavits, and the additional time and cost for mandatory electronic filing. Given that the amount of fees awarded under Rule 73 is inadequate, I would strongly suggest that the Utah Supreme Court seriously look at raising the baseline amount of attorney’s fees that are awarded under this rule.
The process and pleadings now required to obtain default have changed significantly since the fee schedule was last revised. Additionally, it has been several years since this schedule was analyzed against the backdrop of inflation, increased filing fees, increased costs, and increased attorney fee rates.
I personally believe that the starting tier should either be combined with the second tier, or that all tiers be upwardly adjusted by at least $50.
Without appropriate adjustments to the schedule, the purpose, predicability and “judicial ease” of the schedule will become moot as more and more attorney’s choose to file individual affidavits which would then need to be reviewed on a case-by-case basis.
Re URCP 073:
Subsection (d) of this rule should be revised and brought up to date. Costs of doing business have gone up in the last ten years, and those attorneys who rely on this schedule to collect attorney fees are struggling due to the low fee awards provided for.
Those attorneys in private practice who charge their clients by billable hours are able to increase their fees as their costs increase; debt collection attorneys who work on a contingency basis often do not have this luxury. I would propose that each section (0-1500, 1500-2000, 2000-2500 and so on) be increased by at least $50.00 per amount range, to assist in offsetting increased costs for attorneys who collect attorney fees based on this schedule.
I agree with the others below who have commented that the fee schedule in Rule 73 needs to be updated to account for inflation and the increased costs of obtaining a default judgment due to recent rule changes. Thirteen years without any adjustment is a substantial period of time. It seems like fairness dictates increasing the fees that can be requested under the table. Otherwise, attorneys may discontinue using the fee table and start filing affidavits of costs that could bog down the court system.
The Rule 73 fee schedule needs to be updated. The costs of doing business have substantially increased since the fee schedule was last visited, including substantial increases in court filing fees. Additionally, the amount of work and process to even be awarded a default has substantially increased with SCRA requirements, e-filing requirements, new Rule 55 requirements, etc. The lower tiers of the schedule simply do not represent a reasonable estimation of attorney fees in today’s market. This is requiring my office to file affidavits with more and more cases which defeats the judicial efficiency principles sought by the Rule 73 schedule.
The original purpose behind the attorney’s fee schedule was not only to provide a minimum basis of attorneys fees but to allow the judges to allow court clerks to sign off on the default judgments. It was really more for judicial economy. Since the last revision of the schedule was more than 13 years ago, the current schedule needs to be adjusted. All costs associated with filing cases has increased for an attorney. The addition of electronic filing has dramatically increased the costs of filing cases. All costs of operations of a law firm have significant increases since 2013 including staff, office space, filing fees, insurance costs, etc.
Our office has already started to file attorneys fee affidavits and not use the schedule because it no longer is sufficiently close to what our actual costs are on most cases. I anticipate that many other attorneys are in the same boat. If the schedule is not updated, then the purpose of saving the judges time via use of the schedule will be lost.
I have reviewed other comments. I believe that Mark Olson, who has been involved in this for some time, has stated effectively the reasons for schedule to be revised.
I support the changes to Rule 73. I further believe that the schedule needs revision concurrently and that the starting tier should be at the $400 level.
It seems that this is a good opportunity to review the fee schedule set forth in Rule 73 URCP. It has been approximately ten years (possibly more) since the schedule has been addressed. The costs of doing business have increased dramatically since that time. Additionally, as frame of reference the costs of filing a complaint have increase by 50-100% during that same period of time.
It seems to me that a recalculation of the attorney’s fees with the minimum fee starting at $325.00 for damages sought of $0.00 to $1,500.00 and then shifting the present attorney fees authorized up one level with a new cap of $825.00 for amounts $4,500.01 up.
My name is Scott Jensen, I am the current chair of the Collection Section for the Utah State Bar. The Rule 73 fee schedule , which was set up for collections is in need of an update. Mark Olson has done a great job of researching the history of the Rule above. I also believe that the Rule as it stands is outdated. Our expenses as collection attorneys has become increasingly more burdensome. I believe that the lowest category for attorneys fees should begin at least at $400.00 for debts from $1.00 to $1,500.00
The amounts and thresholds of Rule 73 need to be updated. This rule is important as it saves valuable court time and frankly attorney time. But these amounts need to be updated occasionally as are court fees and default interest rates. It’s hard to imagine handling even a tiny case from start to finish for an attorney fee of $250.
I concur with others that the Rule 73 fee schedule needs to be updated and the minimum fee allowed increased. In addition to increased costs since the fee schedule was first implemented, more work is now required in order to obtain a default judgment. When you also consider increased attorney salaries/billing rates, the minimum fee is no longer reasonable and in many cases results in the need to file an attorney fee affidavit, which also increases the workload for the courts/judges. In light of these reasons and those expressed by others, the minimum fee for cases under $1500 should be at least $350 and the rest of the scale adjusted accordingly.
Rule 73:
In joining what others have posted, the Rule 73 chart for fees has not been updated in over 10 years and does not reflect the costs of doing business in 2016. We have seen the cost of business rise in every sector of our businesses. A few years ago the courts addressed their needs in rising costs of business by raising the filing fees significantly; however, the attorneys fees chart in rule 73 has not been addressed to reflect the rising cost of business for attorneys. It is now an appropriate time for the Supreme Court to review the fee chart and raise the compensation allowed for attorneys.