Thursday, March 17, 2016

Tennessee Equal Access to Justice Act

Yesterday, I mentioned the proposed bill pending before the Tennessee Gen. Assembly, which would have the effect of allowing a state or local employee to recover his or her attorney’s fees in the event that a lawsuit is brought against the employee unsuccessfully. That’s Senate Bill 2377, House Bill 1679.

I probably should have mentioned the Tennessee Equal Access to Justice Act, Tenn. Code Ann. § 29-37-101 et seq., which allows a small business or neighborhood organization to recover attorneys fees where a State agency or local government has acted arbitrarily and capriciously as determined by a court of law. A small business or a neighborhood organization may recover their attorneys fees and costs associated with suing the state or local government in order to overturn the decision.

In most litigation, demonstrating that the state or local government has acted arbitrarily and/or capriciously, is a very difficult task. However, in land use planning litigation, most of which is filed by means of the common law writ of certiorari, it turns out that demonstrating arbitrary and capricious action is not all that difficult. In fact, in order to prevail on a common law writ of certiorari in the first place, you must demonstrate to the court that the zoning board or the planning commission acted arbitrarily and capriciously. Only then, will the court reversed the decision of the local government.

As a result, in many types of local land-use litigation, if the plaintiff or petitioner is a small business (which includes a partnership or corporation with gross receipts of less than $2 million during the 12 months preceding the lawsuit and which does not employ more than 30 persons on a full-time basis) or a neighborhood or homeowners association, attorneys fees and costs may be recovered if the decision of the zoning board or planning commission is reversed by the court.

The amount of the fees are limited to $10,000, but that limitation applies to each prevailing party and to each stage of the litigation. Therefore, it is possible to recover the attorneys fees associated with the appearance of an attorney before the local zoning board or planning commission, the attorneys fees for the appeal to trial court, and then to the Court of Appeals and then finally to the Tennessee Supreme Court. Theoretically therefore, the attorneys fees in such a case for each entity which prevails could be as much as $40,000. State v Thompson, 197 S.W. 3d 685 (Tenn. 2006).

Although the statute was adopted back in 1984, it is still somewhat little-known, and even less used. If you represent parties in local administrative proceedings, the ability to recover attorneys fees under the appropriate statutory circumstances, can make it much easier for your client. Note however that the statute does not require the court to award fees. The court may make an award but may certainly decline to do so if there are circumstances which would make the award unjust. I certainly have had cases where although the court reversed the decision of the zoning board, it found circumstances were such as to disqualify my client notwithstanding compliance with the statutory prerequisites.

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