Attorney’s fees. Award of attorney's fees for public health enforcement was not authorized by statute nor warranted under an equitable exception to the American Rule.

Town of Milton Board of Health v. Brisson, 2016 VT 56 (filed May 6, 2016).

SKOGLUND, J. The Town of Milton successfully brought an action to enforce a town order requiring defendant to remediate problems with his residence that constituted a public health hazard. Defendant does not contest either the civil penalty or the compensatory costs for engineering fees assessed against him by the court, but contends that the court's award of attorney's fees was neither authorized under the applicable statute nor warranted under an equitable exception to the American Rule requiring each party to bear the cost of its own attorney's fees. We agree and therefore vacate the attorney's fee award.

The provision at issue in this case is 18 V.S.A. § 130(b)(5), which provides that the court may order "reimbursement from any person who caused government expenditures for the investigation and mitigation of the public health risk or the investigation, abatement, or removal of public health hazards." Id. § 130(b)(5). The Town argues that the plain meaning of the term "governmental expenditures" in § 130(b)(5) encompasses its attorney's fees incurred in its enforcement action against defendant. We disagree.

Attorney’s fees are a unique type of expense that is subject to special rules and treatment. Generally, when the Legislature has intended to authorize the award of attorney's fees in a particular action—beyond that permitted under the common law—it has done so explicitly. The American Rule disallows attorney's fees absent an express statutory authorization. Accordingly, we hold that § 130(b)(5) does not authorize the superior court to award attorney's fees as part of the reimbursement allowed therein.

The Town also argues that even if § 130(b)(5) does not authorize an award of attorney's fees, the superior court acted within its discretion in awarding the fees in the alternative based on an equitable exception to the American Rule. Again, we disagree.

The equitable power to award attorney's fees as an exception to the American Rule "must be exercised with cautious restraint . . . only in those exceptional cases where justice demands an award of attorney's fees." This is not a case where the interests of justice demanded an award of attorney's fees. The court made no finding of bad faith or of vexatious or wanton conduct on the part of defendant.

DOOLEY, J., dissenting. Because attorney's fees plainly fall within the statutory language allowing recovery of expenditures incurred in the enforcement of public health orders and because an award of such fees is in keeping with the statute's overall remedial purpose, I would hold that the statute allows recovery of the attorney's fees requested in this case, and affirm. I dissent from the majority's holding to the contrary.

The majority ignores a relevant line of cases beginning with Key Tronic Corp. v. United States, 511 U.S. 809, 811 (1994), (addresing the availability of attorney's fees for private plaintiffs, as part of pollution “response costs”). See also United States v. Chapman, 146 F.3d 1166 (9th Cir. 1998)(addressing whether government agency can recovery attorney’s fees as part of s remediation expenses) To the extent we look to persuasive authority to decide this case, we should follow Chapman and Key Tronic. I am authorized to state that Justice Eaton joins this dissent.