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03/10/92 OLIVER T. CARR COMPANY v. UNITED

March 10, 1992

OLIVER T. CARR COMPANY, APPELLANT
v.
UNITED TECHNOLOGIES COMMUNICATIONS COMPANY, APPELLEE



CERTIFICATION OF QUESTION OF LAW by the United States Court of Appeals for the District of Columbia Circuit to the District of Columbia Court of Appeals, pursuant to D.C. Code § 11-723.

Before Ferren and Wagner, Associate Judges, and Kern, Senior Judge.

The opinion of the court was delivered by: Kern

KERN, Senior Judge: The parties to this litigation entered into a contract pursuant to which Oliver T. Carr Company [hereinafter "Carr"] agreed to purchase a telephone system from United Technologies Communications Company [hereinafter "UTCC"]. UTCC did make delivery and Carr paid ninety percent of the contract price, some $67,000. Carr, however, was dissatisfied with what it had purchased. Ultimately, Carr filed suit for breach of contract and breach of warranty. UTCC defended against Carr's suit. In addition, UTCC filed a counterclaim for the remaining ten percent due and unpaid. *fn1

The trial court (the United States District Court for the District of Columbia) concluded after hearing testimony that Carr failed to carry its burden of proof as the plaintiff in its breach of contract and warranty suit and entered judgment for UTCC, except with respect to some minor problems Carr had with the voltage in the telephone system for which the court awarded $1,485 compensation to Carr. As to the counterclaim by UTCC for the amount it asserted Carr had left unpaid under the contract, the court entered judgment for UTCC.

The court awarded court costs and attorneys' fees to UTCC in the amount of some $216,000 it had incurred in (1) defending Carr's suit, (2) pursuing its counterclaim against Carr for ten percent of the purchase price due and remaining unpaid under the contract, and (3) preparing a fee petition and litigating its right to fees. The Oliver T. Carr Co. v. United Technologies Communications Co., Memorandum and Order, Civil Action No. 85-1432 at 5 (D.D.C. February 9, 1990).

Carr contends that it was liable for only a fraction of the attorneys' fees awarded by the trial court, and that the fee award was unreasonable in any event. Carr unsuccessfully sought modification by the trial court of its award and then appealed to the United States Court of Appeals for the District of Columbia Circuit. Carr maintains that the award was too large for three reasons:

(1) that UTCC is entitled under the contract only to fees incurred in litigating its counterclaim for the balance of the purchase price of the system and not for those fees incurred in defending against Carr's claims for breach of warranty and contract ("defensive fees"); (2) that the contract does not provide for fees incurred in litigating the fee award ("secondary fees"); and (3) that the contract does not permit an award of fees incurred by UTCC in litigating its counterclaim for the price of the additional equipment. Oliver T. Carr Co. v. United Technologies Communications Co., Memorandum, No. 90-7035 at 5 (U.S. App. D.C. January 16, 1991) (emphasis added).

The Circuit Court concluded that with respect to this last argument, Carr had waived its ground for objection by not raising the issue in the trial court. Thus, the Circuit Court, sua sponte and pursuant to the applicable statute, *fn2 has certified to this court for determination under applicable local law the remaining issues; i.e., "whether . . . the contractual provision at issue here should be construed to authorize an award to UTCC of either defensive [attorneys'] fees or secondary [attorneys' fees." Id. at 6.

The Circuit Court states that "questions of District of Columbia law are determinative of the pending appeal" and believes these questions are "without controlling precedent in the decisions" of this court. Oliver T. Carr v. United Technologies Communications Co., Certification of Question of Law, No. 90-7035 (U.S. App. D.C. January 16, 1991). The court expresses concern that it "is not now positioned to render a secure, nonconjectural Disposition of the cause, and, therefore, on its own motion, certifies these questions of law to the District of Columbia Court of Appeals." Id. Also, the court notes two decisions by this court which appear to be inconsistent: Ochs v. L'Enfant Trust, 504 A.2d 1110 (D.C. 1986) and Kudon v. f.m.e. Corp., 547 A.2d 976 (D.C. 1988).

The questions of law, according to the United States Court of Appeals for the District of Columbia Circuit, were two-fold. First, the court asked:

Does a contract providing that "in the event any amounts due and remaining unpaid . . . are referred [by the seller] to an agency or attorney for collection, Customer shall be responsible for and pay any and all costs associated with such collection including . . . a reasonable attorney's fee" permit an award to the seller of attorney's fees incurred in defending against a breach of warranty claim brought by the customer in addition to fees incurred in litigating a counterclaim for the amount due under the contract?

The second question of law the court referred to this court is:

Under District of Columbia law, and given the undisputed facts . . . does the same contractual provision permit an award of attorneys' fees incurred by the seller in ...


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