Decision

This matter comes before the court upon Defendant Velva Dunn's Objection to the Magistrate's Decision dated June 26, 2002. For the following reasons, Defendant's Objection is OVERRULED.

I. Background

Magistrate Hummer filed a Magistrate's Decision on February 20, 2002 finding in favor of plaintiff, Nancy Ridenour, on her complaint and on defendant's counterclaim. The issue of an award of attorney fees was reserved until after the hearing on the merits. On May 13, 2002, Magistrate Hummer conducted a hearing on the issue of attorney fees only. A decision was filed on June 26,2002 awarding plaintiff $1,000.00 in attorney fees pursuant to R.C. 5321.16. On July 2, 2002, the Court entered final judgment in favor ofplaintiff for compensatory damages in the amount of $510.00, statutory attorney fees in the amount of $ 1,000.00 plus judgment interest and the costs of the action. Defendant filed a timely objection to the Magistrate's Decision.

II. Law and Analysis

When an objection to a magistrate's decision has been filed, the trial court must determine whether the decision contains "sufficient findings of fact for the court to make an independent analysis of the material legal issues." The Spring Works, Inc. v. Sarff(June 20,1996), Franklin App. No. 96APE02-127. Upon consideration of any objections, the court may adopt, reject or modify the magistrate's decision, hear additional evidence, recommit the matter to the magistrate with instructions, or hear the matter. Civ.R.53(E)(4)(b).

Defendant's objection is limited to the amount of the award of attorney fees. Defendant submits that because plaintiff has paid and is only obligated to pay her counsel $375.00, that amount is the maximum amount of any award to be considered by the court. Further, because plaintiff did not prevail on most of her claims, the amount of an award, if any, should be reduced significantly from $375.00. Defendant's argument that $375.00 is the maximum amount of any award is a distortion of the contract between plaintiff and her counsel. Although counsel for plaintiff testified that he accepted $375.00 in payment for his services and that he would not look to her for any payment beyond that amount, he further testified that he and his client understood that he intended to seek recovery of attorney fees if the case were tried to the court. The fee arrangement anticipated that counsel might be paid from any fees that may be awarded by the court. If the court awarded fees that exceed the amount she had already paid, plaintiff would be able to recover the $375.00 she had paid from the fees ordered to be paid by the court and her counsel would keep the rest. The fee arrangement contemplated that counsel would proceed with the case at some risk to him financially but with an expectation that he might be compensated appropriately with statutory fees. (Partial Transcript May 13, 2002 at page 8). The fee arrangement was a hybrid contingent fee agreement, a fact which the court should take into consideration in assessing reasonable fees pursuant to DR2 106.

"Our holding is consistent with at least one of the legislative objectives underlying R.C. 5321.16(C). A commonly accepted view of the purpose underlying this statute is that attorney fees are provided for in order to ensure the return of wrongfully withheld security deposits at no cost to tenants. Lacare v. Dearing (1991), 73 Ohio App.3d 23 8, 241, 596 N.E.2d 1097, 1099; Sherwin v. Cabana Club Apts. (1980), 70 Ohio App.2d ll,, 17,24 O.O.3d 11, 14,433 N.E.2d 932,937., A court award of costs serves precisely the same purpose. Ohio adheres to the "modern theory" that costs "are in the nature of incidental damages allowed to indemnify a party against the expense of successfully asserting his rights in court." Symons v. Eichelberger. (1924), 110 Ohio St. 224, 23 8, 144 N.E. 279, 283." Christie v. GMS Mgt. Co., Inc. (2000), 88 Ohio St.3d 376, 378.

In another case involving the award of statutory fees in connection with a violation of the Consumer Sales Practice Act, the Ohio Supreme Court cited with approval the following reasoning of the Second Circuit Court of Appeals: "Since recoveries under this Act are often small and generally insufficient to cover attorney fees, without an award of attorney fees many consumers would be persuaded not to sue. Id. at 30, 548 N.E.2d at 935-936. The legislative purpose of the section allowing an award of attorney fees was'to prevent unfair, deceptive, and unconscionable acts and practices, to provide strong and effective remedies, both public and private, to assure that consumers will recover any damages caused by such acts and practices, and to eliminate any monetary incentives for suppliers to engage in such acts and practices.' (137 Ohio Laws, Part II, 3219.) Awarding attorney fees under the Act allows private redress of individual wrongs, but also may benefit the community generally because a judgment for the consumer may discourage violations of the Act by others. Bittner v. Tri-County Toyota, Inc. (1991), 58 Ohio St.3d 143, 569 N.E.2d 464. 'Prohibiting private attorneys from recovering for the time they expend on a consumer protection case undermines both the purpose and deterrent effect of the Act." Parker v. I&F Insulation Co. (2000), 89 Ohio St.3d 261, 264, citing Tanner v. Tom Harrigan Chrysler Plymouth, Inc. (1991), 82 Ohio App.3d 764,76566. This rationale that supports the legislature's decision to include statutory fees for a violation of the Consumer Sales Practices Act Chapter 1345 applies equally to violations of the Ohio Landlord Tenant Law and an award of attorney fees pursuant to R.C. 5321.16.

This case presents exactly the scenario discussed in Tanner, i. e. a small recovery that is not sufficient to cover reasonable attorney fees. The fee agreement between plaintiff and her counsel was similar to a contingent fee agreement because counsel for plaintiff accepted employment with the anticipation of recovering his fees from the opposing party and not his own client. At least one Ohio court has held that it was not error to use a contingent fee arrangement between plaintiff and its counsel as a basis for a determination of an award of reasonable attorney fees in a conversion claim. Central Trust Company v. Warburg (1995), 104 Ohio App.3d 186. The court said that contingent fee agreements serve an important, purpose, to provide the public with access to the courts. Id., at 189-190. As noted above, this is particularly true in the area ofremedial legislation such as consumer and landlord-tenant law. Because plaintiff's counsel took this case on what amounted to a contingent fee basis and further supported his claim with an itemized bill supported by his testimony and that of Mr. Williston, the court finds that plaintiff is entitled to recover reasonable attorney fees even though plaintiff was not obligated to pay more than $375.00.

The Court has reviewed the Objection and memoranda in response, the partial transcript of the May 13, 2002 hearing and the Magistrate's Decision. The Court finds that the magistrate has supported his decision with sufficient findings of fact for the court to make an independent analysis of the material legal issues. Specifically, the magistrate explained in the decision that he considered the factors set forth in DR2-106, that he recognized that plaintiff had been only partially successful but that plaintiff should not be penalized for that failure. The amount of attorney fees, $1,000.00, is less than 25% of the total fees requested and bears a reasonable relation to the successful prosecution of a judgment amount of $5 10.00. The magistrate's decision contains sufficient reasoning to support the award.

III. Conclusion

For the foregoing reasons, Defendant's Objection is overruled.

5-23-03

JUDGE W. DWAYNE MAYNARD

Copies to
Andrew J. Ruzicho, II
3040 Riverside Drive Suite 120
Columbus, Ohio 43221
Attorney for Plaintiff

James C. Becker
4380 Braunton Road
Columbus, Ohio 43220
Attorney for defendant

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