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CHAWLA, ET AL. v. BURGERBUSTERS, INC.


CHAWLA, ET AL. v.
BURGERBUSTERS, INC.


April 17, 1998
Record No. 970941

INDER CHAWLA, ET AL.

v.

BURGERBUSTERS, INC.

OPINION BY SENIOR JUSTICE ROSCOE B. STEPHENSON, JR.
FROM THE CIRCUIT COURT OF FAUQUIER COUNTY

William Shore Robertson, Judge
PRESENT: Carrico, C.J., Compton, Lacy, Keenan, Koontz, and
Kinser, JJ., and Stephenson, Senior Justice


In this appeal, we consider, inter alia, whether
the trial court erred in (1) interpreting and applying a
provision in a lease providing for the payment of attorneys’ fees
and (2) placing upon the defendants the burden of proving that
the attorneys’ fees claimed by the plaintiff were unreasonable.

I

The attorneys’ fees in question were incurred by
BurgerBusters, Inc. (BurgerBusters), a tenant in a shopping
center, in a chancery suit it brought against Inder and Vera V.
Chawla (the Chawlas), the owners of the shopping center and
BurgerBusters’ landlord. In the suit, BurgerBusters claimed that
the Chawlas breached the lease agreement by leasing space in the
shopping center to a bank and by constructing a bank building
which was not a structure or use "substantially shown"
on the site plan attached to the lease. BurgerBusters contended
that the bank was not a "retail" establishment, that
the bank occupied less than the 4,500 square feet of space shown
on the site plan, and that the bank deprived BurgerBusters of
four parking spaces. BurgerBusters sought an injunction requiring
the demolition of the bank building, restoration of the four
parking spaces, damages, and attorneys’ fees and costs.

In their answer, the Chawlas denied that they had breached the
lease. By their amended cross-bill, the Chawlas alleged that
BurgerBusters had unreasonably refused to consent to the
construction of the bank building. Among other relief, they
sought to have the lease reformed; however, the trial court
denied all relief.

The trial court also denied BurgerBusters’ claim for monetary
damages. The court was unable to conclude that the lease term
"retail" did not encompass a bank. However, the court
did conclude that the bank building and its drive-thru lanes did
not substantially conform in size, shape, or structure to the
site plan attached to the lease. The court ordered that the
structure be enlarged to approximately 4,500 square feet or, in
the alternative, be demolished.

Thereafter, both BurgerBusters and the Chawlas sought recovery
of attorneys’ fees expended in the chancery suit based upon the
following provision in the lease:

Tenant shall pay to Landlord and Landlord shall pay to Tenant
all costs and expenses, including attorney fees, incurred
. . . in exercising any of their rights or
remedies hereunder or in enforcing any of the terms, conditions
or provisions hereof.

The trial court concluded that BurgerBusters was, and the
Chawlas were not, entitled to recover attorneys’ fees.

The trial court then ordered an issue out of chancery, and,
after a two-day hearing, the jury rendered an advisory verdict,
awarding BurgerBusters $446,389.56, the precise amount of
attorneys’ fees it had claimed. The court denied the Chawlas’
motion to set aside the verdict and entered a final judgment in
accordance with the verdict. The Chawlas appeal.

II

The evidence established that BurgerBusters’ attorneys
expended approximately 3,150 hours on the chancery suit. More
than 300 pleadings were filed, 15 to 20 depositions were taken,
and approximately 50 distinct motions were filed. Thirty separate
court hearings were conducted, including a seven-day trial.

Each party called an attorney as an expert witness. The
Chawlas’ expert opined that BurgerBusters’ fee application was
unreasonable. He described the case as "straightforward
. . . not a complex matter" and as one that
could have been handled by a single lawyer assisted by an
associate or a paralegal. Instead, he noted, BurgerBusters had
been represented by 11 lawyers, three paralegals, and a summer
associate. He also observed that, "when you have all of
these lawyers working on things, you’ve got a duplication of
effort." He believed that a reasonable fee in the case would
have been "in the range of $30,000.00 to $40,000.00."

BurgerBusters’ expert opined that, given the magnitude of the
case and the issues involved, the attorneys’ fees were
reasonable. He noted that the hourly rates charged were on the
lower end of the scale of charges for legal services in the
Northern Virginia area.

III

The Chawlas first contend that the trial court erred in
denying their recovery of attorneys’ fees for their successful
defense of some of BurgerBusters’ claims. They rely upon the
provision in the lease which provides that each party shall pay
to the other attorneys’ fees incurred by them "in exercising
any of their rights or remedies [under the lease] or in enforcing
any of the terms, conditions or provisions [of the lease]."

Although the trial court correctly found that "[the
Chawlas] prevailed on a number of the substantive issues in the
case," the court, nonetheless, denied the Chawlas’ request
because "their prevailing was in the defensive nature and
not in the exercising of rights or remedies or enforcing
terms." We think the trial court erred.

In interpreting a provision in a lease, as with any contract,
a court looks to the plain meaning of the language employed and
gives the language its intended effect. Amos v. Coffey,
228 Va. 88, 92-93, 320 S.E.2d 335, 337 (1984). Thus, courts must
interpret a lease as written and not make a new and different
contract for the parties. Great Falls Hardware v. South
Lakes Village Ctr.
, 238 Va. 123, 125-26, 380 S.E.2d 642,
643-44 (1989); Berry v. Klinger, 225 Va. 201, 208,
300 S.E.2d 792, 796 (1983).

In the present case, we do not read the lease provision to
limit recovery of attorneys’ fees solely to the plaintiff;
rather, we think both the plaintiff and the defendants may
exercise rights and remedies under the lease and enforce its
terms, conditions, or provisions. Here, BurgerBusters, in
exercising its rights and remedies under the lease, claimed that
a bank was not a "retail" establishment, and the
Chawlas claimed that it was. On that issue, the trial court was
in equipoise and ruled that the bank could remain in the shopping
center as a "retail" concern. Therefore, the Chawlas
prevailed on that issue. They also prevailed when the trial court
denied BurgerBusters’ claim for monetary damages. To the extent,
therefore, that the Chawlas were successful in the litigation,
they were entitled under the lease to recover their reasonable
attorneys’ fees.

IV

The Chawlas further contend that the trial court erred in
placing on them the burden of establishing that the attorneys’
fees sought by BurgerBusters were unreasonable and in so
instructing the jury. BurgerBusters claims that the Chawlas
failed to preserve these issues for appeal and that, even if the
issues were preserved, the trial court ruled correctly.

We first consider whether these issues were preserved for
appeal. Several months before trial of the attorneys’-fee issue,
BurgerBusters filed a "motion for a determination of which
party shall bear the burden of proof on the amount of fees and
costs to be awarded [BurgerBusters] under the parties’
lease." The court heard argument on the motion on May 20,
1996. The Chawlas presented the court with a memorandum of law
and oral argument in support of their contention that the burden
of proof was upon BurgerBusters. By an order entered July 1,
1996, the court ruled that "the [Chawlas] shall bear the
burden of proof on the issue of whether [BurgerBusters'] costs
and expenses are excessive or unreasonable." Counsel for the
Chawlas endorsed the order as "seen and objected to for the
reasons stated on the record on May 20, 1996 and also for the
reasons set forth in [the Chawlas'] exceptions attached
hereto." The attachment contained a clear statement of the
Chawlas’ position on the burden-of-proof issue.

On December 1, 1996, the trial court entered a "pretrial
order" in which it restated its previous ruling on the
burden of proof and also listed the various factors the jury
would consider in reaching "the ultimate decision."
Counsel for the Chawlas endorsed the December 1, 1996 order as
"SEEN AND AGREED." Then, when the trial court
instructed the jury that the Chawlas had the burden of proof on
the issue of the reasonableness of BurgerBusters’ attorneys’
fees, the Chawlas failed to object on the ground the burden was
misplaced.

However, when the decree appealed from was entered on February
7, 1997, counsel for the Chawlas endorsed the decree as
"SEEN AND OBJECTED TO: — See . . . pleading
entitled Exceptions to Decree . . . filed on Feb. 7,
1997." The exceptions included a lengthy reiteration of the
Chawlas’ position on the burden-of-proof issue.

BurgerBusters contends that the Chawlas waived or abandoned
their earlier objection to the court’s ruling on the burden of
proof when their counsel endorsed the pretrial order as
"seen and agreed" and when their counsel failed to
object to the jury instruction. We do not agree.

Rule 5:25 provides, in part, that "[e]rror will not be
sustained to any ruling of the trial court
. . . unless the objection was stated with
reasonable certainty at the time of the ruling." The purpose
of requiring timely specific objections is to afford a trial
court the opportunity to rule intelligently on the issues
presented, thereby avoiding unnecessary appeals and reversals. Wright
v. Norfolk and Western Railway Co., 245 Va. 160, 167-68,
427 S.E.2d 724, 728 (1993). In 1992, Code ? 8.01-384(A) was
amended to provide, in pertinent part, as follows:

No party, after having made an objection . . . known
to the court, shall be required to make such objection
. . .  again in order to preserve his right to
appeal . . . a ruling, order, or action of the court.
No party shall be deemed to have agreed to, or acquiesced in, any
written order of a trial court so as to forfeit his right to
contest such order on appeal except by express written agreement
in his endorsement of the order.

Waiver is the voluntary and intentional abandonment of a known
legal right, advantage, or privilege. Weidman v. Babcock,
241 Va. 40, 45, 400 S.E.2d 164, 167 (1991); Fox v. Deese,
234 Va. 412, 425, 362 S.E.2d 699, 707 (1987). The essential
elements of waiver are knowledge of the facts basic to the
exercise of the right and intent to relinquish that right. Weidman,
241 Va. at 45, 400 S.E.2d at 167; Fox, 234 Va. at 425, 362
S.E.2d at 707. Waiver of a legal right will be implied only upon
clear and unmistakable proof of the intention to waive such right
for the essence of waiver is voluntary choice. Weidman,
241 Va. at 45, 400 S.E.2d at 167; May v. Martin,
205 Va. 397, 404, 137 S.E.2d 860, 865 (1964).

In the present case, the Chawlas’ counsel made clear to the
trial court his objection to the ruling respecting the burden of
proof issue and never abandoned or evidenced an intent to abandon
the objection. Thus, the Chawlas preserved the issue for appeal.

We now consider the substantive issue; i.e., whether
the trial court erred in placing upon the Chawlas the burden of
proving that the attorneys’ fees claimed by BurgerBusters were
unreasonable. The trial court instructed the jury, in pertinent
part, as follows:

[T]he burden is on [the Chawlas] to show that the attorneys’
fees . . . claimed by BurgerBusters are excessive or
unreasonable . . . .

You may award BurgerBusters each item of fees
. . . shown in its fee application unless the
Chawlas prove by the greater weight of the evidence that such
item is excessive or unreasonable.

Recently, in Seyfarth, Shaw v. Lake Fairfax Seven
Ltd. Prtnrshp.
, 253 Va. 93, 96, 480 S.E.2d 471, 473 (1997),
decided after the trial court’s decision in the present case, we
held that "[a]n attorney who seeks to recover legal fees
. . . must establish, as an element of the attorney’s prima
facie case, that the fees charged . . . are
reasonable." In determining whether a party has established
a prima facie case of reasonableness, a fact finder
may consider, inter alia, the time and effort
expended by the attorney, the nature of the services rendered,
the complexity of the services, the value of the services to the
client, the results obtained, whether the fees incurred were
consistent with those generally charged for similar services, and
whether the services were necessary and appropriate. Id.
at 97, 480 S.E.2d at 473.

We think Seyfarth, Shaw is dispositive of the issue in
the present case. The party claiming the legal fees has the
burden of proving prima facie that the fees are
reasonable and were necessary.

We hold, therefore, that the trial court erred in placing upon
the Chawlas the burden of proving that the attorneys’ fees
claimed by BurgerBusters were unreasonable.

V

For the reasons stated, we will reverse the trial court’s
judgment and remand the case for a new trial. Upon remand, each
party will have the burden of establishing, as an element of its prima
facie case, that the attorneys’ fees it seeks are
reasonable in relation to the results obtained and were
necessary. Neither party shall be entitled to recover fees for
duplicative work or for work that was performed on unsuccessful
claims.

Reversed and remanded.

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