AMERICAN ARBITRATION ASSOCIATION IN THE AMTTER OFARBITRATION BETWEEN BRIAN AND ANNA MULNIX, Claimants, Case No.: 0147?0000-7705 vs. TOLL BROTHERS, INC, TOLL PA, L.P., TOLL PA GP CORR, TOLL BROS, INC, TOLL ARCHITECTURE, INC, and TOLL ARCHITECTURE l, P.A., Respondents. FINDINGS OF FACT, CONCLUSIONS OF LAW AND AWARD SUR FEES AND COSTS CLAIM FINDINGS OF ACT1 1. On May 1, 2018, the Arbitrator found in favor of Claimants? on their Claims for breach of contract; (2) breach of the implied warranties of habitability and workmanship; (3) and violations of the Unfair Trade Practices and Consumer Protection Law, 73 Pa. CS. 201, et seq. and against Respondents Tell Brothers, Ina, Toll Bros, lne., Toll PA, LP, and Toll PA, GP. 2. The Arbitrator found that Claimants are prevailing parties, entitled to atterneysi? fees under the Unfair Trade Practices and Consumer Protection Law, 73 Pa. CS 20}, et The Arbitrate? has reviewee the relevant evidence anti submissions ef the narties, along with iegai argument made dating the course of the hearing, and has carefully considered and weighed ail the evidence, arguments and cited authorities in reaching these Findings and Conclusions, The failure to speci?eaiiy articulate and address any party?s argument contrary to the Arbitrater?s Findings and Conclusions, snail not be deemed to demenstrate failure of the Arbitrator to consider evidence, submissiens, arguments and cited authority, To the extent any factnai ?ndings appear in the Conciusiens Law seetien, or vice versa, those shenid be deemed to be ?ndingsteonelnsions nf the Arbitrator, as if set forth in the apprenriate section of this document, seq. 73 P.S. 201?92, and Construction Industry Arbitration Rule 48(d). 3. Claimants were awarded compensatory damages against Respondents Toll Brothers, Inc., Toll Bros, lnc., Toll PA, LP, and Toll PA, GP,jointly and severally, as follows: a. For a foil reclad and attendant repairs of Claimants? home, in the amount of $210,000.00. 13. For past repairs to Claimants? home, in the amount of $23,464.00. 4. Claimants were awarded litigation costs against Respondents Toll Brothers, lnc., Toll Bros, Inc., Toll PA, LP, and Toll PA, GP, jointly and severally, as follows: a. Arbitration Costs and Fees in the amount of $22,800.00; b. Expert Costs in the amount of $32,549.50; and 0. Court Reporter fees in the amount of $3,731.25. 5. Claimants were awarded no multiplied damages under the 6. Claimants were awarded reasonable attorney fees against Respondents Toll Brothers, Inc., Toll Bros, Inc, Toll PA, LP, and Toll PA, GP, jointly and severally, under the 73 PS. and Rule 480:1), in an amount to be determined by the Arbitrator upon further submissions.2 7. Claimants ?led submissions in support of their attorneys? fee claims on March :23, 2018, and supplemental submissions on May 8, 8. Respondents filed a response to Claimants? fee submissions on May 29, 20? 8. 9. Claimants? ciairns and their common law claims invoived a common core of facts and related iegal theories. 2 The parties fee submissions were ?ied pursuant to the Arbitrator?s May 1, Crder. Neither party reoueste? a further nearing. 10. ll 12. 13. 14. 15. 16. Most of Claimants? counsels? time was dedicated to the litigation as a whole. . Most of the expenses and expert fees were dedicated to the litigation as a whole. Claimants? counsels? time cannot readily be divided on a precise claim by claim basis. The Arbitrator found that the negligence and. professional negligence claims were barred by the applicable statute of limitations. Some, but not all, of the evidence presented on these claims was relevant to the other claims in this case, including the claims. Additionally, the brie?ng on these claims was not, in the main, relevant to the other claims in the case. Accordingly, the fee claim will be reduced by ten percent of the adjusted fee claim (see 16-17, in?rm), to reflect the lack of success on the negligence and professional negligence claims. Some of the expert testimony in support of the negligence and professional negligence claims also related to the remaining claims, including the claim and cannot be readily divided on a claim by claim basis. The rates charged by Claimants? counsel Jennifer Horn, Kathleen Seligman, Carter Williamson, Wendy Bennett, Margaret Juliane, Natalie Young and Daniel Poruban are reasonable and well within the range of customary charges by counsel of similar experience in the Philadelphia metropolitan legal community. See Af?davit of Kevin 13. Watson, fl 7; Affidavit of Jennifer Horn, l6~21. See 52250 Community Legal Services of Philadelphia Attorney Fees Chart, The rates charged by Claimants? counsel Courtney Mazzio and Raehel Jeans, and are not within the range of customary charges by counsel of similar experience in the Philadelphia metropolitan legal eommunity and are, therefore, not reasonable. See 3 in 203s, counsel for Respondents, Raymond DeLuca. oiiled his time in excess of Mr. DeLuca was admitted to the bar in 1996 and has been practicing eonstruction law for 20 years. 3 Community Legal Services of Philadelphia Attorney Fees Chart, Their reasonable hourly rates are: Courtney Mazzio $250, Rachel Jeans - $220. Id. Accordingly, the fee claim is reduced by $358.50.4 17. The rates charged by Claimants for work by paralegals exceed the range of customary charges by senior paralegals in the Philadelphia metropolitan legal community, and therefore are not reasonable. Community Legal Services of Philadelphia Attorney Fees Chart, Their reasonable hourly rates are $165. Accordingly, the fee claim is reduced by $2,164.50.5 18. Examination of the detailed billing records, observation of the hearing sessions and review of the submissions demonstrates to the Arbitrator that there was some unreasonable redundancy or overlap of work. Accordingly. the fee claim will he reduced by ten percent of the adjusted feel clairn (see ilii i6??l 7, supra). 19. The balance of the time otherwise expended by Ciaimants? counsel was reasonable in context of the time and labor required to prosecute their claims and respond to Respondents? defense. the level of novelty and dif?culty of the questions invoived and the level of skill requisite properly to conduct the case. Claimants sought fees for Mazzio at the rate of $275/hr 13.4 hours, for a total of 33685. Application of the rate of $250/hr that the Arbitrator has found reasonable. results in a total of $3350. for a reduction ofthe eiairn in. the amount of $335. Claimants sought fees tor Jeans at the rate of $225/hr. for 4.7 hours. Application of the $220/hr. rate the Arbitrator has found reasonable. resuits in a reduction of the claimed amount of $23.50. 5 Claimants sought fees for Heather Havener (ESE) at the rate of 23.90 hours. Appiieation of the $l65thr. rate the Arbitrator has found reasonable, results in a reduction of the claimed amount by 32% .53 Claimants sought fees for Robert Roekey (RR) at the rate of $l7S/hr. 8i hours. Application of the Si?SEhr. rate the Arbitrator has found reasonable. resuits in a reduction of the claimed. amount by $83 .00. Ciaimants sought fees for Eiizabeth Ogilvie (ECO) at the rate of $150.?hr. .7 hours. Because Claimants sought a rate less than the reasonable hearty rate for paraiegals found by the Arhitrator, there is no reduction to the amount claimed for her services. Claimants sought fees for Patricia Tailent at the rate of $205i?hr. l3 hours. Appiieatiou of the $165/hr. rate the Arbitrator has found reasonahte. results in a. reduction of the eiaimed amount by $52. 4 20. 21. 22. Ix.) 24. 25. The case was vigorously litigated by the parties. Virtually all of Claimants? factual and legal claims were contested by Respondents, requiring the expenditure of signi?cant time and effort by Claimants? counsel. Those expenditures of time, less the areas previously deducted, were reasonable and necessary. Claimants derived signi?cant benefit from the work of their counsel, as they were made whole for the reclad of their home, as well as the expenditures they made in an attempt to repair the defects. The af?davit of Respondents expert, Kevin B. Watson, does not re?ect that he reviewed the transcripts of this matter or the May 1, 2018, Findings of Fact, Conclusions of Law and Partial Award in this matter. Id. at 4, 27. . Although Mr. Watson ?understands? the amount of compensatory damage award to be $233,464 (Af?davit of Kevin B. Watson, 24), he does not acknowledge and does not appear to be aware of the awards for arbitration costs, expert witness fees and transcripts. Id. at 4, 27. Mr. Watson opines that the award of ?attorney fees and expenses? should eot exceed one third of the claim, or in this matter $85,000. Id. at 22, 25. Mr. Watson provides no examples from speci?c cases demonstrating the validity of his i/B fees to claim formula or any methodology, generaily accepted in the field or otherwise. Considering the expenses that have already been awarded in the total amount of $59,080.75, Mr. Watson?s formula would result in an attorneys" fee award of $25,9l925 ($85,000 minus prior costs award of $59,080.75) a completely anreasonabie amount. 26. 27. 28. 29. 30. The Arbitrator does not credit Mr. Watson?s analysis and ?nds his proposed fee formula completely unreasonable under the facts and circumstances of this matter, and the ?ndings made herein and in the Partial Award of May 1, 2018. The mere number of attorneys and paralegals who may have been involved in this litigation on behalf of Claimants is not dispositive or even particularly relevant to the reasonableness of the work done. Rather, the Arbitrator has done a thorough analysis of this matter as set forth above, and with the stated exceptions, has concluded that the hours and rates are reasonable and that the reasonable hours times the reasonable rates, yields an appropriate attorneys? fee in this matter (see 30, in?rm), Review of the individual invoices demonstrates that the total amount of Claimants? attorneys? fees claim is $142,695. Review of the individual invoices demonstrates reasonable additional litigation expenses of $2,505.24.6 The total amount of reasonable attorneys? fees awarded, after adjustment for unreasonable attorney and paralegal hourly rates (W 16-17, supra), reduction by ten percent of the adjusted claim to reflect the lack ef success on the negligence and professional negligence claims (ii l3, supra), and reduction by ten percent 0f the adjusted. claim to re?ect unreasonable redundancy or overlap of work l8, supra), is $1 12,137.60.7 5 The invoices aise indicate a February 29, 29 8, payment fer transcripts and a March 31, 2Gl 8, payment te expert witness Robin Kohn. These ameunts were included in the arbitraterls Partial Award (if May l, 2038. "fetal invoiced Fees: Reduction in attorney rates: $358.59 Reduetien in paraiegal rates: $11 64.5%} Subtetai: Reductien Of Tomi Fee Award: 32 6 31. The amount of Attorneys? fees awarded by the Arbitrator, equal to approximately forty- eight percent of the damages award, is not disproportionate. CONCLUSIONS OF LAW 1. The Unfair Trade Practices and Consumer Protection Law, 73 Pa. CS. 201, et seq. provides that a prevailing party may be awarded ?costs and reasonable attorney fees.? 73 Pa. (3.8. 201-92. 2. ?[T]he fee-shifting statutory provision of the is designed to promote its purpose of punishing and deterring unfair and deceptive business practices and to encourage experienced attorneys to litigate such. cases, even where recovery is uncertain.? Boehm v. Riversource Life Ins. Ca, 1 l7 A.3d 308, 336 (Pa. Super 2015). 3. ?In general, ?the manner by which attorneys? fees are determined in this Commonwealth, under fee~shifting provisions, is the lodestar approach.? See Krebs United Re?ning Co. of 893 A.2d 776, 792-93 (Pa. Super. 2006)]. The lodestar is the product of ?the number of hours reasonably expended on the litigation times a reasoeable hourly rate.? Id. at 790.? Krishnan v. Curler Grim, Inc, 171 A.3d 856, 903 (Pa. Super. 2017). 4. ?in a case involving a lawsuit which include[s] claims under the the following factors should be considered when assessing the reasonableness of counsel fees: (1) The time and labor required, the novelty and dif?culty of the questions involved and the skill requisite properly to conduct the case; (2) The customary charges of the members of the bar for similar services; (3) The amount ievolved in the controversy and the benefits resulting to the clients from the services; and (4) The contingency or certaiety of the compensation.? Krishna}? v. Gaffer Grp., lea, 171 A.3d 856, 900 (Pa. Super. 20l 7), citing Beckie at 335, 5. "in cases in which the [claimants?l successful and unsuccessful claims lnsolve a common core of facts or related lecal theories, or where much of counsel?s time is dedicated to the litigation as a whole, it is often impossible to divide counsel?s time on a precise claim-by? claim basis." Boehm v. Rivet-source we Ins. ll? A.3d 308. 335 (Pa. Super 2015), quoting Northeast Women's Center v. McMonagle. 889 F.2d 466. 476 (3rd Cir. I989). ?[T]he CLS fee schedule is ?well developed? and ?reasonable in ?xing the hourly rates? charged in civil rights actions in Philadelphia." Sch. Dist. of Phila. v. Kirsch, 2018 U.S. App. LEXIS 2819, at (3d Cir. Feb. 5, 2018), quoting Maldonado v. Houstoun. 256 F.3d 181, 187-88 (3d Cir. 200l). ?Quite simply, the form of fee arrangement between the prevailing party and counsel will generally have little or nothing to do with whether the purposes of the statute are served in the decision to award fees and costs.? Krebs v. United Ref Co, 893 A.2d 776. 792 (Pa. Super. 2006). ?[F]ocus on whether [Claimants] incurred out-of-pocket expenses as a result of their litigation, is contrary to the purposes behind the General Assembly's inclusion of a fee-shifting provision in the [statute]." Id. at 793. The collectability of fees from Claimants under the hourly fee agreement is inelevant to an award of fees under the See 1d. and Kris-heart. 171 A.3d at 902-03. . ?Notably, this Court has previously ?found a multiple of 11.5 of UTPC PL damages to the attorney fee award was not disoroportionate.m Krtirhnan. 171 A.3d at 903 n.33. quoting Boehm. I I7 A.3d at 336 (wherein attorneys? fees exceeded damages award). .In considering fee petitions. the following activities relevant to this action are compensable: a Time spent prior to ?ling the proceeding: b. Conferences and organizing case ?les: c. Background research. attorney discussions. strategy sessions. and settlement negotiations: d. Routine activities such as making telephone calls and reading mail related to the case: Travel time; Legal research; Time spent working with an expert witness in connection with a litigation; and Time expended in pursuit of a fee award. Freon." 12. Expert witness fees and related costs are recoverable. Krishna", 171 A.3d at 872-73; Hines v. Corp. 911 F. Supp. 212, 216 (ED. Pa. 1997) (reading the to include expert fees). l3.Although Construction Industry Arbitration Rule 48(d)(ii). provides for the availability of an award of attorney fees where, as here. all parties have requested such an award (See May 1, 2018. ?nding at 1 86), the Rule does not provide guidance on the factors to be considered in rendering such an award. Accordingly, the Arbitrator ?nds that the general rules of lodestar formula? and other considerations for fees under the speci?cally. and analogous fee shifting laws. generally. apply to an award under Rule 48(d)(ii). with the exception that such a fee award under the Rule is not limited to the claim. and instead applies to all claims as to which a party prevails. 14.??Thc arbitrator is not empowered to redctermine the merits of any claim already decided." Construction Industry Arbitration Rule 51(a). 15. An award of attorneys? fees in the total amount of ?12.13160 re?ects the factual ?ndings of the Arbitrator, and is a lodestar reached by multiplying the number of hours reasonably expended on the litigation by the reasonable hourly rates of Claimants? counsel and paralegals. The lodestar is "the product of reasonable hours times a reasonable rate." Samuel-Basso" Kit: Morons Am. Inc. . 34 A.3d l. 1 n. 2 (Pa. 20 Quoting ('l'ry Hague. 505 U.S. 557. 559(1992). .. -4. I6. An award of additional litigation costs in the amount of $2,505.24, under 73 P.S. is reasonable and appropriate. AN Aw I. Claimant is awarded reasonable attorney fees against Respondents Toll Brothers, Inc.. Toll Bros. Inc.. Toll PA. LP. and Toll PA. GP,jointly and severally, under the 73 PS. and Rule 48(d). in the total amount of$l 12.87.60. 2. Claimant is awarded further litigation expenses against Respondents Toll Brothers, Inez. Toll Bros. Inc., Toll PA. LP. and Toll PA. GP. jointly and severally, in the amount of $2505.24. 3. This award. in conjunction with the Award of May l. 2018. constitutes the complete and final award in this matter. By the Arbitrator: Wil i. Judge of the Court of Common Pleas Dated: June 5. 20 8 10