Attorneys Fees • Costs • Time Records • Hourly Rate

East Mark Int’l. v ADAR, PICS Case No. 14-0175 (E.D. Pa. Jan. 24, 2014) Bartle, J. (13 pages).

Intervenors, alleging a partial ownership interest in a building sold pursuant to an alleged mortgage default, are entitled to reasonable counsel fees and costs in an action arising from a lis pendens on and the sale of a building in Philadelphia.

East Mark held a mortgage on the building owned by ADAR, doing business as Lincoln, and filed a complaint for confession of judgment after an alleged default on the mortgage. After a marshal’s sale was scheduled in the matter, the intervenors, Faibash and Olewski, filed for a temporary restraining order alleging that they had 42.5 percent ownership interest in the building and that the mortgage held by East Mark was a fraud intending to deprive them of their ownership interest. The court granted a restraining order, cancelled the marshal’s sale and scheduled a preliminary injunction hearing for August 14, 2013. On August 13, Faibash, Olewski, East Mark and Lincoln filed a stipulation for court approval stating that the parties agreed that the dispute would be resolved through a Bet Din (rabbinical court) proceeding and that East Mark would take no further action on the judgment by confession obtained earlier in the case.

On October 17, 2013, Faibash, Olewski and others filed a motion to enforce the stipulated order alleging that Lincoln and East Mark had violated the stipulated order when East Mark filed an emergency petition to strike the lis pendens filed against the property and to complete specific performance under an agreement of sale. The lis pendens consisted of a July 30, 2012 Bet Din order prohibiting the sale of the building without the Bet Din’s authorization. The Common Pleas court granted the petition, struck the lis pendens from the record and Lincoln then sold the property to a third party without the approval of the intervenors. Since East Mark was due more than the sale price, all moneys went to East Mark.

The court denied an emergency motion to enforce the stipulated order filed by the intervenors in October 2013 because East Mark was not in violation when it took action to remove the lis pendens. The order only obligated East Mark to take no further action on its judgment by confession. However, as part of its October order, the court ordered Lincoln to pay intervenors their reasonable counsel fees and costs on the ground that Lincoln had flagrantly violated the court’s August stipulated order by proceeding to sell the building without prior authorization from the Bet Din proceeding.

Lincoln did not argue that there were circumstances that make the award unjustified, rather they objected to individual time entries logged by intervenors’ attorney and to the attorneys’ hourly rate. Intervenors submitted detailed time records in support of their motion.

Viewing the complexity of the case, the work product of the attorneys and the compressed time frame of this matter, an hourly rate of $300 was fair and reasonable.