Judge Nealon Applies Attorney's Fees Statute

In his recent decision in the case of Lilac Meadows Inc. v. Panko, No. 2011-CV-4375 (C.P. Lacka. Co. Nov. 9, 2012 Nealon, J.), Judge Terrence R. Nealon of the Lackawanna County Court of Common Pleas addressed a Defendant’s request for counsel’s fees after the Defendant’s demurrer to the Plaintiff’s Complaint was sustained. The Defendant’s request for counsel’s fees was based upon an argument that the Plaintiff had acted arbitrarily, vexatiously and in bad faith in filing the suit against the prevailing Defendant.

The court's decision was governed by the attorney’s fees statute found at 42 Pa. C.S.A. §2503(9).  Section 2503(9) of the judicial code provides for the recovery of counsel fees as part of taxable costs where “the
conduct of an other party in commencing the matter or otherwise was arbitrary, vexatious, or in bad faith.”

Judge Terrence R. Nealon
Lackawanna County

Judge Nealon noted that, because §2503(9) “reads in the disjunctive,” a trial court need only finds that one of the statutory factors was present, i.e., that the action was initiated arbitrarily, vexatiously, or in bad faith. [citation omitted].

The Court noted that a litigant’s conduct could be deemed to be “arbitrary” under §2503(9) “if such conduct is based on random or convenient selection or choice rather than on reason or nature.” [citations omitted].

The Court stated that a party is considered to have brought a suit “vexatiously” if (1) the suit was filed without sufficient ground in either law or in fact, and (2) the suit served the sole purpose of causing annoyance. [citations omitted].

Judge Nealon also pointed to case law holding that a party is chargeable with filing a lawsuit in “bad faith” if the party commences suit for the purposes of fraud, dishonesty, or corruption. [citations omitted].

After applying the law to the record before it, the Court ruled that the Defendant had not satisfied its burden of establishing that the Plaintiff’s actions in filing and pursuing the claim at issue were either arbitrary, vexatious, or in bad faith. Accordingly, the Petition for Attorney’s Fees was denied.

Anyone desiring a copy of this decision may contact me at dancummins@comcast.net.