Supreme Court of Georgia Approves "Double Recovery" of Attorney's Fees by Plaintiffs
05/16/2022By Sam Britt
Recently, the Georgia Supreme Court handed down an important, and somewhat surprising, ruling that will impact the way attorney’s fees and litigation expenses are allocated, and possibly allow Plaintiff to obtain a “double recovery.”
In the recent decision of Junior v. Graham, 2022 WL 677415, the Supreme Court of Georgia effectively approved the double recovery of attorney’s fees and litigation expenses by Plaintiffs under O.C.G.A. § 13-6-11 and O.C.G.A. § 9-11-68. In the underlying case, the plaintiff was injured in a car accident and filed suit against the tortfeasor. The plaintiff alleged that he was entitled to recover attorney’s fees and expenses of litigation under O.C.G.A. § 13-6-11 because the defendant had “acted in bad faith, [had] been stubbornly litigious, or [had] caused plaintiff unnecessary trouble and expense.” During the course of litigation, the plaintiff served an offer of settlement upon the defendant in the amount of $600,000, pursuant to O.C.G.A. § 9-11-68. This statute, intended to encourage reasonable settlement of claims during the course of litigation, provides in relevant part as follows:
If a plaintiff makes an offer of settlement which is rejected by the defendant and the plaintiff recovers a final judgment in an amount greater than 125 percent of such offer of settlement, the plaintiff shall be entitled to recover reasonable attorney’s fees and expenses of litigation incurred by the plaintiff or on the plaintiff’s behalf from the date of the rejection of the offer of settlement through the entry of judgment.
The defendant rejected the O.C.G.A. § 9-11-68 offer of settlement. The case proceeded to trial, where the jury found in favor of the plaintiff and awarded $3,000,000 in compensatory damages, $1,200,000 in attorney’s fees, and $51,554.95 in litigation expenses, pursuant to O.C.G.A § 13-6-11.
After trial, the plaintiff filed a motion for attorney’s fees and expenses pursuant to O.C.G.A § 9-11-68, arguing that he was entitled to further recover for his attorney’s fees and expenses because the final judgment exceeded 125 percent of the offer of settlement made during litigation. The trial court denied the motion, finding that an award of attorney’s fees and expenses under O.C.G.A. § 9-11-68 would amount to a prohibited “double recovery.” The plaintiff appealed, and the Court of Appeals affirmed the decision of the trial court.
The Supreme Court reversed the rulings of the trial court and Court of Appeals. Although the measure of attorney’s fees and expenses were the same under both O.C.G.A. § 13-6-11 and O.C.G.A. § 9-11-68, the Supreme Court distinguished between “damages” for attorney’s fees and expenses allowed under O.C.G.A. § 13-6-11 and the “sanctions” of attorney’s fees and expenses allowed under O.C.G.A. § 9-11-68. By making this distinction, the Supreme Court was able to hold that the plaintiff could recover his attorney’s fees and expenses under both statutes.
Georgia has a longstanding public policy that a plaintiff is not entitled to a “double recovery” of damages. The rationale is simple: a claim for damages should return the plaintiff to the position that the plaintiff occupied before the injury, and not unreasonably enrich the plaintiff by allowing her to recover more than was lost. While the Supreme Court recognized this public policy, it ultimately disregarded it. As a result, plaintiffs can now recover twice for their attorney’s fees and expenses of litigation under these statutes. In practice, our firm is already seeing plaintiffs amend their complaints to add O.C.G.A. § 13-6-11 claims and serve O.C.G.A. § 9-11-68 offers of settlement to take advantage of this decision.