author: BRODY, Justice.

text:
    WADSWORTH REESE, PLLC, an Idaho professional corporation; Clark A. Reese CPA P.C., an Idaho professional corporation; and Wadsworth Accounting CPA, an Idaho professional corporation, Plaintiffs-Counterdefendants-Respondents, v. SIDDOWAY & COMPANY, PC, an Idaho professional corporation; Randy Siddoway, an individual, Defendants-Counterclaimants-Appellants.
    Siddoway & Company, PC, an Idaho professional corporation; Randay Siddoway, an individual, Counterclaimants-Appellants, v. Frederick Wadsworth, an individual; and Clark A. Reese, an individual, Counterdefendants-Respondents.
    Docket No. 46126
    Supreme Court of Idaho, Boise, May 2019 Term.
    Filed: July 25, 2019
    Hasting Law Group, LLC, Salt Lake City, for appellants. Brett W. Hastings argued.
    Fisher & Hudson, Boise, for respondents. Vaughn Fisher argued.
   BRODY, Justice.

This appeal arises from the division of a three-member accounting firm, Siddoway, Wadsworth & Reese, PLLC. The three members of the firm were the personal professional corporations solely owned by each accountant. In early 2015, Reese PC signed a purchase agreement to buy a one-half interest in the client base of Siddoway PC for $200,000. This purchase agreement included an arbitration clause.

In August of 2015, Siddoway left the accounting firm, taking several employees and the clients' information with him. Following Siddoway's departure, the firm (now named Wadsworth Reese, PLLC), along with its remaining members, filed a complaint in the district court against Siddoway and his personal professional corporation and two of the employees who followed him. Siddoway counterclaimed.

The parties brought a range of claims.

Reese PC and Siddoway PC also went to arbitration for claims related to their purchase agreement, but the arbitrator determined the purchase agreement was void for failure of a condition subsequent.

The remaining claims between the parties were tried by the district court. The district court entered findings of fact and conclusions of law, ultimately deciding to "leave the parties where it found them." This included the following final determinations pertinent to this appeal: the district court ordered dissociation of Siddoway's personal professional corporation as a firm member; Siddoway and Siddoway PC were not entitled to attorney fees for compelling arbitration; Siddoway PC failed to show unjust enrichment from the void purchase agreement; and the firm could fund Reese's personal professional corporation's litigation and arbitration costs because resolving the purchase-agreement dispute served a legitimate business purpose. Siddoway and Siddoway PC timely appealed.

We affirm the district court's judgment. Siddoway and Siddoway PC were not entitled to attorney fees for compelling arbitration, nor did they show unjust enrichment or breach of membership duties.

I. FACTUAL AND PROCEDURAL BACKGROUND

Clark Reese, Frederick Wadsworth, and Randy Siddoway are each certified public accountants with their own professional corporation (respectively, Reese PC, Wadsworth PC, and Siddoway PC). In 2012, Reese became an employee of Siddoway PC. Following the death of Steve Harding, one of Siddoway's former accounting partners, Siddoway and Reese began discussing becoming partners on terms that Reese would purchase a one-half interest in Siddoway's practice. This term was to balance out the client base each accountant would bring to the new firm-Siddoway brought about 450 clients while Reese brought less than ten clients from his previous positions.

On December 20, 2013, Reese and Siddoway formed CRS Services, PLLC. A month later, they changed the accounting firm's name to Siddoway, Wadsworth & Reese to reflect the addition of a third accountant, Frederick Wadsworth. About that same time, Siddoway, Wadsworth & Reese (hereinafter Wadsworth Reese PLLC to reflect its current title) obtained the Harding client base. That purchase agreement between Wadsworth Reese PLLC (then named CRS) and Harding & Co., P.A., contained a five-year non-competition provision.

Siddoway PC, Reese PC, and Wadsworth PC signed the Siddoway Wadsworth Reese operating agreement on January 6, 2014, which gave each member a one-third membership interest in the firm. The operating agreement did not include a non-competition clause. However, the operating agreement appears to have been intended as a temporary document because the three members had yet to decide all the terms under which they would do business together.

A year later, on January 28, 2015, Siddoway PC and Reese PC signed "the Reese Agreement" in which Reese PC promised to pay Siddoway PC $200,000 for a one-half interest in Siddoway's client base. Reese PC signed an associated promissory note for $200,000, while Reese signed guaranties to both the Reese Agreement and promissory note. Reese PC agreed to pay the $200,000 in monthly payments over the next four years. The Reese Agreement contained a non-competition clause, an agreement to arbitrate, and a provision that awarded "the prevailing party" attorney fees following legal action.

Right on the heels of Siddoway PC and Reese PC signing the Reese Agreement, the three individual accountants all signed a modification of the Reese Agreement that required the three members of Wadsworth Reese PLLC to agree to amend the operating agreement to finally settle the terms under which they would do business together by February 15, 2015, or else the Reese Agreement would be void. Despite the three members' failure to reach an agreement by the February 15 deadline, Reese PC continued to make payments to Siddoway PC under the Reese Agreement. Ultimately, Reese PC paid approximately $28,000 to Siddoway PC. Siddoway PC had transferred numerous clients to Wadsworth Reese PLLC, and Reese became the accountant for hundreds of those clients, based both on his capacity to take on the work as well as Siddoway's referrals to Reese.

In 2015, Siddoway's relationship with both Reese and Wadsworth broke down, causing the parties to discuss buyout options and begin negotiations on how Siddoway PC would exit Wadsworth Reese PLLC. The parties never agreed upon terms. On August 21, 2015, Siddoway announced he was leaving the firm. As Siddoway left Wadsworth Reese PLLC he took several employees with him, including his nephew Dustin Siddoway and administrative employee Jeanine Barkan. On the day he announced his departure, Siddoway also downloaded Wadsworth Reese PLLC's UltraTax files, which contained the firm's clients' names, addresses, tax information, and any work in progress. Siddoway then sent a list of Wadsworth Reese PLLC's clients to Dustin Siddoway.

Immediately after leaving Wadsworth Reese PLLC, Dustin Siddoway formed the accounting firm AnchorPoint, PLLC, while Barkan formed an LLC now called PoleStar Entrepreneurial Group. Their goal was to create complementary businesses with an overlapping clientele. Siddoway's departure ultimately resulted in a "mass migration" of over 200 clients to AnchorPoint. About 60 percent of the Harding client base remained at Wadsworth Reese PLLC. During this time, Dustin Siddoway also met twice with Reese and Wadsworth "to resolve difficulties arising from the company's breakup" and to obtain tax data for certain clients. Siddoway PC and AnchorPoint seem to have remained separated due to concerns over a non-competition provision in the agreement Wadsworth Reese PLLC used to purchase the Harding client base. AnchorPoint and Siddoway PC remain separate entities.

On December 14, 2015, Wadsworth Reese PLLC, Reese PC, and Wadsworth PC, collectively sued Siddoway and Siddoway PC, alleging trade secrets violations, breach of the operating agreement, breach of fiduciary duties, and interference with prospective business advantage, amongst other claims. In addition, the plaintiffs requested a judicial order to dissociate Siddoway from Wadsworth Reese PLLC. Reese PC also sought $28,000 in damages, plus interest, for the amount paid to Siddoway PC under the Reese Agreement. Siddoway and Siddoway PC counterclaimed, alleging breach of the operating agreement, violations of Idaho Code section 30-6-404 for failing to make distributions in equal shares, and misappropriated funds, as well as other business-related claims. Siddoway also requested a judicial dissolution of Wadsworth Reese PLLC.

On February 12, 2016, Siddoway and Siddoway PC filed a motion to compel arbitration on claims relating to the Reese Agreement, and the district court granted the motion. Reese and Reese PC asked the district court to stay the arbitration, but the district court denied and granted the stay in part: it found that the claims against Reese were not arbitrable while the claims against Reese PC were. At arbitration, the arbitrator ruled that the Reese Agreement was void for failure of a condition subsequent. Following both of the court rulings to compel arbitration and stay the proceedings, Siddoway and Siddoway PC requested attorney fees incurred in compelling the arbitration. The district court denied those motions, finding them premature because the prevailing party could not yet be determined. The court then dismissed Siddoway's claim for breach of the Reese Agreement, with prejudice, and deferred ruling on fees and costs consequent to this ruling until after judgment was rendered on the remaining claims.

After arbitration, Reese PC and Wadsworth PC voted in October 2015 for Wadsworth Reese PLLC to pay for Reese's separate legal representation in the litigation and arbitration over the Reese Agreement. Both Reese and Wadsworth later testified that their respective PCs voted this way because they were concerned about settling ownership of the firm. They were especially concerned about Siddoway claiming a majority interest if the Reese Agreement failed. Both Reese and Wadsworth were also concerned about the firm's potential liability for debts and the obligations to creditors as the firm struggled to maintain revenue. Siddoway and Siddoway PC opposed this expenditure, arguing it was inappropriate.

The district court held a five-day bench trial. Following the trial, the district court dissociated Siddoway PC as a member of Wadsworth Reese PLLC and did not award further relief to any party. The district court also determined that Siddoway PC failed to show unjust enrichment from the void purchase agreement. In summary, the district court decided to "leave the parties where it found them." Two weeks later, Siddoway and Siddoway PC filed a motion to alter or amend the judgment, arguing that Wadsworth Reese PLLC did not have a legitimate business purpose to pay for Reese PC's litigation and arbitration expenses against Siddoway. Siddoway also revived its previous requests for attorney fees incurred in compelling arbitration under the Reese Agreement. The district court denied all requested relief, finding Siddoway's arguments lacked merit and that it was not the prevailing party. Siddoway and Siddoway PC timely appealed.

II. ANALYSIS

Siddoway and Siddoway PC challenge several of the district court's conclusions of law. We will address each issue and its applicable standard of review in turn.

A. The district court did not abuse its discretion by declining to award Siddoway fees and costs related to the arbitration litigation.

Siddoway and Siddoway PC contend that the district court committed reversible error in deciding that Siddoway was not the "prevailing party" entitled to attorney fees where they successfully compelled arbitration for claims under the Reese Agreement. The Siddoway parties' contention breaks into two distinct arguments: (1) that they were the prevailing parties and are entitled attorney fees under the contractual language; and (2) that the district court lacked jurisdiction to consider the Reese parties' motion to stay arbitration. We reject these arguments.

1. Attorney fees

The determination of whether a party prevailed for purposes of an attorney fee award is a discretionary decision of the trial court. See Israel v. Leachman , 139 Idaho 24, 26, 72 P.3d 864, 866 (2003). Accordingly, this Court reviews the district court's determination to deny attorney fees for an abuse of discretion. Id. As long as the court correctly perceived the issue as one of discretion, acted within the outer boundaries of its discretion, acted consistently with the legal standards applicable to the specific choices available to it, and reached its decision by the exercise of reason, we will not disturb the decision on appeal. Lunneborg v. My Fun Life , 163 Idaho 856, 863, 421 P.3d 187, 194 (2018).

The arbitrator ruled that the Reese Agreement was void. Void contracts "are deemed never to have existed in the eyes of the law." Syringa Networks, LLC v. Idaho Dep't of Admin. , 159 Idaho 813, 367 P.3d 208, 222 (2016). Thus, parties generally cannot benefit from a contractual attorney fees provision or statute where the contract is illegal or void. Kosmann v. Gilbride , 161 Idaho 363, 367, 386 P.3d 504, 508 (2016) ; Trees v. Kersey , 138 Idaho 3, 12, 56 P.3d 765, 774 (2002). The limited exception to this rule lies in O'Connor v. Harger Construction, Inc. , where we stated that "[a] party may be entitled to attorney's fees under a contract even if it is established that no contract between the parties ever existed." 145 Idaho 904, 912, 188 P.3d 846, 854 (2008). O'Connor , however, made that determination when examining a contract containing a severability clause that allowed the unenforceable provisions to be severed from the remainder of the contract which contained an attorney fee provision. Id.

Nevertheless, the Siddoway parties maintain that they are the prevailing parties for attorney fee purposes because they compelled arbitration and the Reese Agreement provides a fee award for enforcing its terms even though the arbitrator determined the contract was void. We disagree. The exact language of the attorney fee provision in the Reese Agreement reads: "Should either party be required to commence legal action to enforce any of the terms of this Agreement, the prevailing party in such litigation shall be entitled to an award of reasonable attorneys fees and costs from the other party." Idaho Rule of Civil Procedure 54(d)(1)(B) guides our "prevailing party" analysis. It states: "In determining which party to an action is a prevailing party and entitled to costs, the trial court must, in its sound discretion, consider the final judgment or result of the action in relation to the relief sought by the respective parties." I.R.C.P. 54(d)(1)(B).

Siddoway's argument that it is a prevailing party because it compelled arbitration rests almost entirely on our decision in Grease Spot, Inc. v. Harnes , 148 Idaho 582, 226 P.3d 524 (2010). In that case, Grease Spot filed a complaint against the defendants, alleging violations of a purchase agreement. Id. at 583, 226 P.3d at 526. After the defendants won a motion to compel arbitration, the arbitrator dismissed all of Grease Spot's claims against the defendants and they obtained an order confirming the arbitration award and judgment on the arbitration was entered in their favor. Id. at 583-84, 226 P.3d at 525-26.

This Court affirmed the district court's decision to award attorney fees for successfully compelling arbitration, noting the defendants were "the 'prevailing party' for purposes of receiving attorney fees once they prevailed in compelling arbitration, thereby terminating consideration of the merits of the action." Id. at 586, 226 P.3d at 528. However, Siddoway's circumstances differ greatly from the defendants in Grease Spot . The Grease Spot defendants were prevailing parties not simply because they compelled arbitration, but because they compelled arbitration on all claims and subsequently won at arbitration. This is an important distinction. Our decision in Grease Spot did not solely recognize the defendants' victory of a motion to compel arbitration, but the defendants' victory at "terminating consideration of the merits of the action." Id. That is the opposite of Siddoway's position.

While the district court granted the Siddoway parties' motion to compel, the arbitrator ultimately determined that the entire Reese Agreement was void for failure of a condition subsequent. The Siddoway parties subsequently lost their claims in arbitration as well as every counterclaim before the district court. Their only success concerning the Reese Agreement was in arguing the arbitrability of claims against Reese PC. The district court determined that one successful motion was "nowhere near enough success to make them prevailing parties." We agree. The district court correctly focused on the final judgment and result of the action-specifically in the arbitration proceedings-as required by Idaho Rule of Civil Procedure 54(d)(1)(B). There was no abuse of discretion.

2. Jurisdiction

Next, Siddoway and Siddoway PC contend that the district court lacked jurisdiction to consider Reese PC's motion to stay arbitration. There are two main arguments Siddoway raises within this procedural context: (a) the district court erred in considering Reese PC's motion to stay arbitration because the court lacked jurisdiction at that time; and (b) the district court erred in granting Reese's motion to stay arbitration because Reese, in his personal capacity, was bound to the arbitration agreement. Even if we were inclined to overlook the fact that these arguments were not raised in the district court and that Siddoway cites to no case law, statutes, or rules for the basis of his contentions (with the sole exception of a quick recap on the importance of res judicata), we will not take up the jurisdictional issues because they are moot.

"An issue is moot if it 'does not present a real and substantial controversy that is capable of being concluded through judicial decree of specific relief' or if 'a favorable judicial decision would not result in any relief or the party lacks a legally cognizable interest in the outcome.' " State v. Abdullah , 158 Idaho 386, 462, 348 P.3d 1, 77 (2015) (quoting Arambarri v. Armstrong, 152 Idaho 734, 739, 274 P.3d 1249, 1254 (2012) (citations omitted)). Analyzing now whether the district court had jurisdiction to take up the motions to stay arbitration is an academic exercise that fails to address a real controversy and cannot afford relief to either side. The arbitrator concluded that the Reese Agreement was void. This Court's determination of either the lack of, or presence of, jurisdiction to stay the proceeding will not alter that conclusion, nor would it change the outcome on whether Siddoway and Siddoway PC were prevailing parties for an award of attorney fees.

B. There was substantial and competent evidence that Wadsworth Reese PLLC had a legitimate business purpose to pay legal fees to dissociate Siddoway.

The Siddoway parties next contend that Wadsworth Reese PLLC lacked a legitimate business purpose to pay plaintiffs' legal fees, including Reese and Reese PC's separate litigation and arbitration costs. While unstated in these terms, the Siddoway parties seem to contest the competence of the evidence before the district court. In addition, the Siddoway parties argue that the district court failed to identify this case as a derivative action.

The district court's determination of a "legitimate business purpose" ties closely with questions of good faith, fiduciary duties, and members' duties under the operating agreement, including the finding of whether the attorney fees were distributions or transfers to a non-member third party. Because determining whether a fiduciary breached his duty is a question of fact, this Court will not disturb the district court's findings as long as there was substantial and competent evidence supporting them. Prehn v. Hodge , 161 Idaho 321, 328, 385 P.3d 876, 883 (2016). We conclude that there was substantial and competent evidence to support the district court's findings.

1. This litigation was not a derivative or a direct action.

A derivative action occurs where a member of a limited liability company brings a claim to enforce the company's rights, while a direct action is brought by a member to assert the member's rights. I.C. §§ 30-25-801 to 802. Both of these actions are brought by a member of the LLC, rather than the LLC itself. See id. However, this action was brought by the firm, not a member asserting the member's or the firm's rights. As noted by the district court, the presence of Reese PC and Wadsworth PC on the plaintiff's side was simply superfluous; the clear basis of the litigation has been Wadsworth Reese PLLC's pursuit of its rights. Thus, this action does not fall into the definition of either a derivative or direct action as Siddoway contends.

2. Payments to Wadsworth Reese PLLC's legal counsel were not distributions.

Siddoway and Siddoway PC contend that the payment of legal fees for this litigation and appeal constitute "disproportionate distributions to Reese and Wadsworth and a breach of the utmost fiduciary duties owed by Reese and Wadsworth to Siddoway." The district court found that the payments were not a distribution under the operating agreement and that Siddoway was not entitled to a proportionate payment. Instead, paying the legal fees was a legitimate business purpose to solve the ownership disputes. We agree.

The operating agreement defined "distribution" as "a transfer of property to a Member on account of a Membership Interest as described in Article IX herein." In addition, under Idaho Code section 30-25-409, managing members of a limited liability company owe specific duties of loyalty and care to their company, including "refrain[ing] from engaging in grossly negligent or reckless conduct, willful or intentional misconduct, or knowing violation of law." I.C. § 30-25-409(c). Under the earlier version of the act, each member owed a duty of care to the firm "to act with the care that a person in a like position would reasonably exercise under similar circumstances and in a manner the member reasonably believes to be in the best interests of the company." Law of January 6, 2014, I.C. § 30-6-409(3), repealed by S.L. 2015, ch. 243, § 2, as amended by S.L. 2015, ch. 337, § 4.

First, the district court determined that the payments to Wadsworth Reese PLLC's legal counsel were not "distributions" under the operating agreement because the legal counsel was not a member of Wadsworth Reese PLLC and the payments were not made because of Wadsworth PC and Reese PC owning a membership interest. Instead, the payments were transfers of property to a non-member third party to resolve disputes amongst the firm's members. The operating agreement plainly defines distribution as a payment "to a Member on account of a Membership Interest." As the district court correctly concluded, the legal counsel was not a member nor did they receive payments on account of a membership interest. As such, Siddoway is not entitled to an equal distribution.

Second, the district court concluded that the firm decided to pay Wadsworth Reese PLLC's counsel because of the company's perceived need to address and resolve disputes between the parties. While Siddoway argues that the district court relied only on Reese's testimony at trial, the district court based its conclusion on a range of substantial and competent evidence, including testimony from Reese, Wadsworth, and Siddoway that Siddoway PC might assert a two-thirds interest in the firm if the Reese Agreement failed, as well as additional testimony that the firm was struggling with cash inflow and had growing concerns about obligations to creditors. In addition, the district court concluded that the plaintiffs' vindicated claims demonstrate good faith. Wadsworth Reese PLLC won its claim in proving that Reese owned a one-third interest in the firm under the operating agreement and that the Reese Agreement was void overall. Altogether, the district court's determination was based on relevant evidence that a reasonable mind would accept to support its conclusion.

Undoubtedly, Reese PC's vote for the firm to pay its attorney fees was laced with self-interest. However, "[a] member does not violate a duty or obligation under this chapter or under the operating agreement solely because the member's conduct furthers the member's own interest." I.C. § 30-25-409(e). Likewise, the district court concluded that the evidence did not indicate bad faith from Reese PC or Wadsworth PC in wanting to settle the questions of ownership. These were important issues for the firm to resolve for the owning members, clients, and creditors. The firm's vote to pay the litigation expenses-even for Reese and Reese PC in their separate arbitration and litigation proceedings-was an apposite decision in these circumstances and the district court reached that conclusion based on substantial and competent evidence.

C. The district court did not abuse its discretion in determining that neither Siddoway PC nor Reese PC were unjustly enriched.

The Siddoway parties' final contention is that the district court erred in denying them recovery for unjust enrichment in the Reese Agreement, because Reese PC obtained the benefits of a one-third membership interest in Wadsworth Reese PLLC. The district court determined that neither Reese PC nor Siddoway PC were unjustly enriched. We agree.

Unjust enrichment "is the measure of recovery under a contract implied in law." Barry v. Pac. W. Const., Inc. , 140 Idaho 827, 834, 103 P.3d 440, 447 (2004). This quasi-contract "is not a contract at all, but an obligation imposed by law for the purpose of bringing about justice and equity without reference to the intent of the agreement of the parties, and, in some cases, in spite of an agreement between the parties." Continental Forest Prod., Inc. v. Chandler Supply Co., 95 Idaho 739, 518 P.2d 1201 (1974). Unjust enrichment occurs where (1) the plaintiff confers a benefit on the defendant; (2) the defendant appreciates the benefit; and (3) the defendant's acceptance of the benefit is inequitable without payment to the plaintiff for the benefit's value. Countrywide Home Loans, Inc. v. Sheets , 160 Idaho 268, 272, 371 P.3d 322, 326 (2016). Because this Court reviews rulings on equitable remedies for an abuse of discretion, the four-part abuse of discretion analysis applies here:

Whether the trial court: (1) correctly perceived the issue as one of discretion; (2) acted within the outer boundaries of its discretion; (3) acted consistently with the legal standards applicable to the specific choices available to it; and (4) reached its decision by the exercise of reason.

Lunneborg , 163 Idaho at 863, 421 P.3d at 194. While Siddoway and Siddoway PC argue that the district court's conclusion was arbitrary and unsupported, we conclude that the district court properly reached its decision by an exercise of reason.

Both sides conferred a benefit on the other: Reese PC conferred a benefit of $28,000 to Siddoway PC, which conferred a benefit of one-half of Siddoway PC's client base to Reese PC. Reese PC's benefit also appreciated as he served the client base. Consequently, the key inquiry is whether the Siddoway parties proved that Reese PC's acceptance of the client base was inequitable with the $28,000 benefit Reese PC paid to Siddoway PC. This they failed to do. Once again, Siddoway failed to state the correct standard of review but it appears to be arguing against the reasonableness of the district court's decision in leaving the parties where it found them.

First, Siddoway PC fails in its old argument that it bestowed a benefit of a one-third interest in the firm through the Reese Agreement rather than just an interest in the Siddoway PC client base. Reese PC obtained its one-third interest in Wadsworth Reese PLLC from the firm's operating agreement, which was signed prior to the Reese Agreement and expressly gave Reese PC an equal membership interest alongside Siddoway PC and Wadsworth PC. Thus, Reese PC could not be unjustly enriched by its one-third membership interest.

Second, the Siddoway parties' main evidence of unjust enrichment stems from the assertion that Reese is enjoying the benefit of many clients that previously belonged to Siddoway PC. As for exact monetary calculations on the value of the client base, the district court calculated that Reese PC retained an excess benefit of about $21,358.50 in the following factual analysis:

The total amount Wadsworth Reese collected from former Siddoway PC clients in 2016 was $123,397 (rounded to the nearest dollar). This total includes payments for services rendered by Wadsworth Reese not only in 2016 but also in 2014 and 2015, but the record doesn't show the degree to which it is attributable to services rendered before the Siddoway Parties cut ties with Wadsworth Reese in August 2015, or instead to services rendered after the cutting of ties. In any event, Siddoway PC contends Reese PC derived a benefit equal to 80% of $123,397, or $98,717.60, from this revenue. It isn't clear what the 80% factor deducts for, but it is clear that it comes from the formula to which Reese PC and Siddoway PC agreed in setting the $200,000 price under the Reese Agreement for Reese PC to purchase a one-half interest in Siddoway PC's established client base. That formula also contained a second adjustment, by which the result after application of the 80% factor was reduced by another 50%, given that Reese PC was buying only a one-half interest in Siddoway PC's established client base. For reasons they don't explain, the Siddoway Parties don't apply this 50% factor here. Perhaps that's because, by 2016, they had cut ties with Wadsworth Reese and were no longer benefiting from the revenue Wadsworth Reese generated by serving the Siddoway PC client base, to whatever extent those clients remained with Wadsworth Reese. But Reese PC undeniably shared the benefit of that revenue equally with Wadsworth PC-both received identical monthly management fees, and neither received any profit distributions-so Reese PC garnered no more than half the benefit. Consequently, the Siddoway Parties' $98,717.60 figure would have to be reduced by 50% to account for Wadsworth PC's share of the benefit. This leaves $49,358.80-only $21,358.50 more than the $28,000 Reese PC paid to Siddoway PC under the Reese Agreement.

Despite this excess amount, the district court found several factors significant to support its conclusion that Reese PC was not unjustly enriched. First, the evidence from trial suggested that while "Siddoway PC brought more clients into the venture, Reese PC likely performed much more of the work necessary to service them." Second, the district court also found ample evidence that Reese PC's contributions to the firm ensured the equal compensation of monthly management fees to each member-a contribution of efforts that Siddoway PC likely did not provide to the firm. Third, Siddoway PC's early departure and efforts to send many clients to AnchorPoint deprived Reese PC of the full benefit of the bargain and made assessment of the clients' value difficult. Ultimately, these factors combined to suggest Reese PC was not unjustly enriched. With both parties failing to perform their end of the Reese Agreement, depriving both sides of the full benefits of the bargain, neither Reese PC nor Siddoway PC was unjustly enriched. Leaving the parties to their pre-litigation position was reasonable, not unjust or an abuse of discretion.

D. Wadsworth Reese PLLC is entitled to attorney fees on appeal.

Both appellants and respondents request attorney fees on appeal under Idaho Code section 12-120(3). It states:

In any civil action to recover on an open account, account stated, note, bill, negotiable instrument, guaranty, or contract relating to the purchase or sale of goods, wares, merchandise, or services and in any commercial transaction unless otherwise provided by law, the prevailing party shall be allowed a reasonable attorney's fee to be set by the court, to be taxed and collected as costs.

I.C. § 12-120(3). The gravamen of the underlying transaction was commercial in nature. Thus, because Wadsworth Reese PLLC is the prevailing party on this appeal, it is entitled to attorney fees.

III. CONCLUSION

We affirm the district court's judgment and award attorney fees and costs on appeal to respondents.

Chief Justice BURDICK, and Justices BEVAN, STEGNER, and MOELLER concur.


source: Caselaw Access Project

author: The opinion of the court was delivered by Johnson, J.: Stegall, J., concurring:

license: Public Domain

text:
    Terral BREEDLOVE, Appellant, v. STATE of Kansas, Appellee.
    No. 115,401
    Supreme Court of Kansas.
    Opinion filed July 12, 2019
    Kristen B. Patty, of Wichita, argued the cause and was on the brief for appellant.
    Lance J. Gillett, assistant district attorney, argued the cause, and Marc Bennett, district attorney, and Derek Schmidt, attorney general, were with him on the brief for appellee.
   The opinion of the court was delivered by Johnson, J.:

Terral Breedlove petitions this court for review of the Court of Appeals' decision affirming the district court's summary denial of his K.S.A. 60-1507 motion. With respect to the 60-1507 motion, Breedlove argues that the district court violated due process by failing to appoint counsel to represent him after reviewing a response from the State; that the district court abdicated its duties when it adopted the State's response to the motion as its findings of fact and conclusions of law; and that the district court erred in finding that his motion failed to raise substantial issues regarding the effectiveness of his trial counsel. In addition, Breedlove challenges the district court's assessment of a $195 filing fee as a condition precedent to accepting his "Motion for Summary Disposition," which asked the district court to take action on his motion that had been pending for more than two years. We affirm the summary denial of the motion, but reverse the imposition of the filing fee.

FACTUAL AND PROCEDURAL OVERVIEW

Terral Breedlove was 17 in 1995 when he and a codefendant fatally shot a man behind a Wichita grocery store and stole his car. Breedlove was tried as an adult for this and other crimes and, relevant here, a jury convicted him of felony murder. His convictions and sentences were affirmed on direct appeal.

State v. Breedlove , No. 80,952, 985 P.2d 140, unpublished opinion filed July 9, 1999 (Kan.) (Breedlove I ).

In 2006 Breedlove filed a motion to correct an illegal sentence on the basis that the district court lacked jurisdiction because he was not initially charged in juvenile court and the State did not obtain authorization to prosecute Breedlove as an adult. This court agreed and reversed the convictions and vacated the sentences. State v. Breedlove , 285 Kan. 1006, 1017, 179 P.3d 1115 (2008) (Breedlove II ).

The State brought charges in juvenile court, along with a motion requesting authorization for adult prosecution (MAP), which the juvenile court granted. Breedlove was represented by counsel at various stages in the juvenile and adult proceedings, including at the juvenile detention hearing, the hearing on the MAP, and at the eventual jury trial as an adult in Sedgwick County District Court.

At the retrial in 2009, Breedlove's codefendant, Israel Sosa, implicated Breedlove as the trigger man. A jailhouse informant testified regarding an overheard conversation in which Breedlove implicated himself. Other witnesses said they saw Breedlove in the vicinity of the murder and that he was armed and looking for a vehicle. Breedlove was defended by attorney John Sullivan at the retrial.

Breedlove was again convicted of first-degree murder and sentenced to life in prison. This court affirmed on direct appeal. State v. Breedlove , 295 Kan. 481, 482, 286 P.3d 1123 (2012) (Breedlove III ).

The mandate issued October 9, 2012; Breedlove filed a pro se K.S.A. 60-1507 motion on September 4, 2013. Included with the motion were an affidavit of indigency, a motion to proceed in forma pauperis, and copies of his inmate trust account balance for the preceding six months. Breedlove filed an amended 60-1507 motion on November 12, 2013.

During the period from 2013 to 2015, Breedlove sent several letters to the district court requesting updates on his case. When those inquiries failed to get his motion heard, Breedlove attempted to file a motion for summary disposition in 2015. But the district court refused to accept the filing without an accompanying $195 fee, which is required for dispositive motions, such as motions for summary judgment. Eventually, in August 2015, Breedlove paid the $195 fee and his motion requesting disposition was filed.

Thereafter, the district court-which had already emailed the prosecutor's office requesting a response at least twice-again emailed the prosecutor, requesting that an attorney for the State file a response to Breedlove's 60-1507 motion. The State's response was filed on September 17, 2015, and two business days later the district court summarily denied the motion, adopting the State's response as the court's findings of facts and conclusions of law.

Breedlove timely appealed. The Court of Appeals affirmed, holding that the district court's adoption of the State's response as its findings of facts and conclusions of law was not error; that the district court did not err in summarily denying Breedlove's 60-1507 motion without appointing an attorney despite asking the State for a response; that none of Breedlove's attorneys provided ineffective assistance of counsel; and that the district court did not err in imposing the filing fee for the dispositive motion. Breedlove v. State , No. 115,401, 2017 WL 3001360, at *1 (Kan. App. 2017) (unpublished opinion) (Breedlove IV ).

Breedlove timely petitioned for review.

DISTRICT COURT'S ADOPTION OF STATE'S RESPONSE AS ITS FINDINGS

Breedlove argues that the district court abdicated its constitutional responsibility and ceded judicial power to the State by adopting the State's response as its findings of fact and conclusions of law. He points out that the district court failed to act upon his motion for two years, and then adopted the State's response as its findings two business days after it was filed. Breedlove makes the conclusory claim that the procedure employed by the district court denied him due process.

Standard of Review

A summary denial of a 60-1507 motion is reviewed de novo to determine whether the motion, files, and records of the case conclusively establish that the movant is not entitled to relief. Sola-Morales v. State , 300 Kan. 875, 881, 335 P.3d 1162 (2014). Likewise, whether a district court's findings of fact and conclusions of law are sufficient is reviewed de novo. Robertson v. State , 288 Kan. 217, 232, 201 P.3d 691 (2009). And finally, "[t]he issue of whether due process has been afforded is a question of law over which we have unlimited review." Hogue v. Bruce , 279 Kan. 848, 850, 113 P.3d 234 (2005).

Analysis

When a district court summarily denies a 60-1507 motion, Supreme Court Rule 183(j) requires the court to make findings of fact and conclusions of law supporting its decision. (2019 Kan. S. Ct. R. 228.) The purpose of this requirement is to assist the appellate court in conducting meaningful review. State v. Moncla , 269 Kan. 61, 65, 4 P.3d 618 (2000). In Moncla we remanded for more specific findings because we were "left guessing" as to the district court's rationale for denial of the postconviction motion. 269 Kan. at 65, 4 P.3d 618.

Conversely, even if a district court's findings are abbreviated, we will not remand solely on that basis-the relevant inquiry is whether we can conduct meaningful review. See Robertson , 288 Kan. at 232-33, 201 P.3d 691 (although district judge's rulings were " 'sparse,' " findings and conclusions coupled with the judge's additional statements at the hearing were sufficient to allow for appellate review). In this case, we can conduct a meaningful appellate review because the record on appeal is comprehensive and review of the issues before us is de novo. See Burcham v. Unison Bancorp, Inc. , 276 Kan. 393, 403, 77 P.3d 130 (2003) ("[B]ecause this court reviews summary judgment de novo, the inadequacy of some of the trial court's findings does not preclude effective appellate review.").

Additionally, although we have frowned on the practice of a district court adopting a party's findings in their entirety, we have declined to adopt a bright-line rule that to do so is automatic error. Stone v. City of Kiowa , 263 Kan. 502, 505-06, 950 P.2d 1305 (1997) (although not encouraged because it is susceptible to abuse, adopting a party's findings in their entirety is not inherently erroneous). We agree with the Court of Appeals' determination that Breedlove failed to carry his burden to show that the district court did not do what it was supposed to do, i.e., conduct an independent review of the record. Breedlove , 2017 WL 3001360, at *3. Breedlove offers no evidentiary or legal support on this point; rather, he asks us to infer that the district court could not have conducted a meaningful review based upon the fact that the district court's order followed so closely after the State's response, especially given that the motion had languished on file for over two years. Notwithstanding the unusual timeline, we decline to draw the suggested inference. Cf. State v. Dern , 303 Kan. 384, 394, 362 P.3d 566 (2015) (when no objection made to district court's findings, appellate court can presume district court found all facts necessary to support its judgment).

Finally, we will briefly address Breedlove's argument that the district court ceded judicial power to the State and violated the constitutional principle of separation of powers. Kansas Constitution art. 3, § 1 vests the judicial power in the courts. "The separation of powers doctrine is not expressly stated in either the United States or Kansas Constitutions," rather, it arises out of the reality of the three-branch system of government. State ex rel. Morrison v. Sebelius , 285 Kan. 875, 882-83, 179 P.3d 366 (2008). Simply put, "[e]ach of the three branches of our government ... is given the powers and functions appropriate to it." 285 Kan. at 883, 179 P.3d 366.

But in actual practice there is some overlap between the powers of the various branches of government and " 'separation of powers of government has never existed in pure form except in political theory.' " 285 Kan. at 883, 179 P.3d 366. Indeed, in Morrison , the Kansas Attorney General was found to be acting in his capacity as an officer of the court; and the separation of powers question in that case was between the judiciary, via the Attorney General, and the Legislature. 285 Kan. at 887-88, 179 P.3d 366. See also Supreme Court Rule 202 (2019 Kan. S. Ct. R. 239) (license to practice law is a proclamation by the Supreme Court that the holder is fit to be an officer of the Court). Accordingly, because the State's attorney was acting as an officer of the court, there is no violation of the separation of powers. The district court's actions in this case are akin to the long-standing practice, codified in Supreme Court Rule 170 (2019 Kan. S. Ct. R. 222), of having attorneys prepare journal entries memorializing the results of hearings at the trial court. In short, there was no separation of powers violation here.

APPOINTMENT OF COUNSEL FOR 60-1507 MOVANT

Breedlove raises a procedural challenge to the manner in which the district court handled his 60-1507 motion. Specifically, he argues that, by considering the State's reply to his 60-1507 motion, the district court demonstrated that it could not conclusively determine from the motion, files, and records that Breedlove was not entitled to relief. Therefore, Breedlove contends he was entitled to have counsel appointed and have a hearing on the merits of his claims. See K.S.A. 60-1507(b) (court shall grant a prompt hearing "[u]nless the motion and the files and records of the case conclusively show that the prisoner is entitled to no relief").

Standard of Review

The extent of a movant's statutory right to counsel in a 60-1507 proceeding is a question of law subject to unlimited review. Mundy v. State , 307 Kan. 280, 294, 408 P.3d 965 (2018). To the extent that this matter involves interpretation of K.S.A. 60-1507, K.S.A. 22-4506, and Supreme Court Rule 183 (2019 Kan. S. Ct. R. 228), statutory and rule interpretation is also reviewed de novo. Thompson v. State , 293 Kan. 704, 710, 270 P.3d 1089 (2011).

Analysis

Breedlove bases his argument on the oft-quoted description of a district court's three options upon receiving a 60-1507 motion that was set forth in Lujan v. State , 270 Kan. 163, 170-71, 14 P.3d 424 (2000). He specifically relies on the third option, that was expansively described as follows: "Third, the court may determine that a potentially substantial issue or issues of fact are raised in the motion, supported by the files and record, and hold a preliminary hearing after appointment of counsel to determine whether in fact the issues in the motion are substantial." 270 Kan. at 170-71, 14 P.3d 424.

Breedlove asserts that when the district court requested a response from the State, it "essentially exercised the third Lujan option without appointing counsel for Breedlove," which would require a reversal and remand for a hearing with appointed counsel. Recently, we considered a similar argument and clarified that the event that triggers an indigent movant's statutory right to counsel is the district court's finding that "the [60-1507] motion presents substantial questions of law or triable issues of fact." Stewart v. State , 309 Kan. ----, ----, 444 P.3d 955, 2019 WL 3047724 (2019) (No. 115,149, this day decided), slip op. at 16. That holding comports with long-standing precedent requiring the movant to meet the threshold of showing substantial legal issues or triable issues of fact. Albright v. State , 292 Kan. 193, 199, 251 P.3d 52 (2011) ; Guillory v. State , 285 Kan. 223, 228, 170 P.3d 403 (2007) ; Robinson v. State , 218 Kan. 1, 5, 542 P.2d 305 (1975). The existence of potentially substantial issues simply imbues the district court with the discretionary authority to appoint counsel for the movant, but does not statutorily require the appointment. Stewart , 309 Kan. at ----, slip op. at 11-12, 444 P.3d 955 ("[T]he district court may, but is not required to, appoint an indigent 60-1507 movant an attorney during the period the court is making its determination of whether the motion, files, and record present a substantial question of law or triable issue of fact.").

Likewise, we clarified that the circumstance requiring appointed counsel under the third Lujan option was not the presence of potentially substantial issues, but rather the district court's conducting a preliminary hearing to aid in the determination of substantial issues at which the State is represented by counsel. In that event, procedural due process dictates that the movant has a right to counsel at that hearing. Stewart , 309 Kan. at ----, slip op. at 12-13, 444 P.3d 955. But simply reviewing the State's response to the motion, even when requested by the district court, is not the equivalent of an actual hearing and does not give rise to a right to counsel. See Stewart , 309 Kan. at ----, slip op. at 16, 444 P.3d 955.

In sum, the district court did not find substantial issues of law or triable issues of fact and did not conduct a hearing at which the State was represented. Consequently, the failure to appoint counsel to represent Breedlove was not erroneous.

CLAIMS OF INEFFECTIVE ASSISTANCE OF COUNSEL

Breedlove argues that he was entitled to an evidentiary hearing regarding his claims of ineffective assistance of counsel. Specifically, he claims that counsel at his juvenile detention hearing, Karen Palmer, was ineffective for failing to request or argue for his release upon an appearance bond. He believes that Julia Craft, his juvenile counsel at the MAP hearing, was ineffective for failing to notify his parents of the juvenile proceedings and for attempting to persuade Breedlove to waive the MAP hearing. Finally, he makes several allegations of ineffectiveness against his trial counsel, John Sullivan.

Standard of Review

When the district court summarily denies a K.S.A. 60-1507 motion, review is de novo to determine whether the motion, files, and records of the case conclusively establish the movant is not entitled to relief. Sola-Morales , 300 Kan. at 881, 335 P.3d 1162.

To prevail on a claim of ineffective assistance of counsel, a defendant must satisfy the two factors of Strickland v. Washington , 466 U.S. 668, 687, 104 S. Ct. 2052, 80 L.Ed. 2d 674, reh. denied 467 U.S. 1267, 104 S.Ct. 3562, 82 L.Ed.2d 864 (1984) : first, counsel's performance was deficient, and second, the defendant was prejudiced in that there is a reasonable probability that the jury would have reached a different result but for the deficient performance. Sola-Morales , 300 Kan. at 882, 335 P.3d 1162.

Analysis

The Court of Appeals reviewed each of the substantive claims raised in Breedlove's 60-1507 motion and explained why counsels' performances were not deficient. We agree with the panel's assessment.

Defense Attorney Karen Palmer

With respect to Breedlove's claim that Palmer's assistance was deficient because she did not adequately advocate for Breedlove's pretrial release on bond during the detention hearing in the juvenile court, the panel noted that "it is not likely that Palmer's actions were deficient." Breedlove IV , 2017 WL 3001360, at *4. Nevertheless, the panel also observed that Breedlove had not shown that his continued pretrial detention had any impact on the jury or the outcome of the trial, i.e., Breedlove failed to establish the prejudice prong of the analysis. 2017 WL 3001360, at *4.

Our review of the record shows that Breedlove fails both prongs-counsel's performance was not deficient and there could not have been any prejudice. Palmer did not request release on bail at the detention hearing because she noted that Breedlove was being held without bail due to a hold from another county. Counsel's decision was practical and strategic; this court generally does not second-guess strategic decisions of counsel nor does it require counsel to make futile arguments. State v. Cheatham , 296 Kan. 417, 437, 292 P.3d 318 (2013) ; Chamberlain v. State , 236 Kan. 650, 658, 694 P.2d 468 (1985) (when counsel has no sound basis to believe that pretrial motion would have merit and no basis to make such motion, failure to make it is not ineffective assistance).

The panel also pointed out that a 60-1507 motion is a vehicle to attack a sentence and does not include an attack on a detention hearing having no bearing on guilt or the sentence imposed. Breedlove IV , 2017 WL 3001360, at *4. We need not decide this issue, based on our conclusion that Palmer was not ineffective.

Defense Attorney Julia Craft

Craft represented Breedlove at the hearing in juvenile court to determine whether he should be prosecuted as an adult, and Breedlove first complains that she did not notify his parents of the hearing. The Court of Appeals disposed of this issue on the procedural ground that it was first raised in an amended 60-1507 motion and that the issue did not relate back to the original motion. Breedlove IV , 2017 WL 3001360, at *4-5. That determination is belied by the record. The original motion and accompanying pro se memorandum in support included the following claim:

"Mr. Breedlove's court appointed juvenile counsel failed to act as an advocate when said juvenile counsel did not protect Mr. Breedlove's rights under the juvenile justice code to have his parents provided with notice of the accusations he was to face in juvenile court, nor were Mr. Breedlove or his parents served with notice of any kind informing them of the juvenile court hearing proceedings, most notable [sic ] the juvenile detention hearing."

But we can affirm the panel on the merits of the claim. K.S.A. 2008 Supp. 38-2347(c)(1) required the court to notify each parent of a hearing on a motion for adult prosecution. Breedlove contends that Craft should have taken steps to protect his right to parental notification, but he does not convincingly explain for what purpose. He was 30 years old at the time of the MAP. He fails to establish that any shortcoming in Craft's performance relative to parental notification prejudiced the result of the MAP hearing.

Trial Counsel John Sullivan

Breedlove's principal complaint about Sullivan is based upon attorney discipline that was imposed on Sullivan well after Breedlove's trial. Breedlove's retrial was in 2009; Sullivan's license was first suspended in 2014 and the first allegation of any misconduct was in 2012. In re Sullivan , 308 Kan. 456, 457, 462, 420 P.3d 1001 (2018). Breedlove would have us infer that Sullivan's performance at his 2009 trial was substandard because of misconduct that occurred three years later. We decline the invitation. Later unprofessional conduct is not a per se determination of prior ineffective assistance. See Wilson v. State , 40 Kan. App. 2d 170, 180-81, 192 P.3d 1121 (2008). Allegations of deficient performance or misconduct must be connected to specific errors in the appellant's trial in order to constitute ineffective assistance. Cheatham , 296 Kan. at 434-35, 292 P.3d 318.

Breedlove's allegations specific to his trial are that Sullivan failed to pursue an alibi defense and failed to investigate other potential defense witnesses. The alibi defense claim is based on Breedlove's current assertion that an unidentified friend had given him a ride home at the time of the murder. Pointedly, however, Breedlove fails to identify that friend and points to nothing in the record that would indicate that he told his counsel about the alibi or provided his attorney with any information from which such a defense could have been developed. To avoid summary denial of a K.S.A. 60-1507 motion, a movant has the burden to make more than conclusory contentions and must state an evidentiary basis in support of those claims or some evidentiary support must appear in the record. Edgar v. State , 294 Kan. 828, 836, 283 P.3d 152 (2012). Breedlove fails to carry that burden here.

Next, Breedlove argues that counsel failed to interview and present a potential key witness who would have testified to seeing two other men at the crime scene talking to the victim. Again, Breedlove does not identify this witness; as with the alibi defense, there is only a conclusory statement with no support in the record and we cannot declare counsel's performance to be deficient.

Breedlove also argues that a witness identified as C. Phillips would have contradicted testimony from another witness, Anthony Davis, who testified about incriminating statements Breedlove made while in jail. But again, Breedlove does not provide information beyond conclusory statements. Moreover, a review of the record shows that Sullivan impeached Davis' testimony in other ways; the jury convicted Breedlove anyway and Breedlove fails to show how he was prejudiced by this omission. See Wilkins v. State , 286 Kan. 971, 985-87, 190 P.3d 957 (2008) (not ineffective for failing to cross-examine State's witnesses about plea agreement when information came into evidence through other witnesses).

Breedlove argues that Sullivan failed to impeach certain witnesses with testimony from the 1997 trial, but we agree with the Court of Appeals that a review of the record shows no merit to this contention. Sullivan did impeach one of the witnesses, Davis, and attempted to impeach others. Breedlove has not shown how Sullivan's performance was deficient in this aspect. See Wilkins , 286 Kan. at 987, 190 P.3d 957 (failure to impeach must satisfy Strickland test to be ineffective).

Breedlove complains that Sullivan was deficient for failing to object to testimony from the victim's daughter because the testimony served no purpose but to inflame the passions of the jury. Our review of the record shows that the daughter's testimony was brief, was not sensational, and served the legitimate purpose of establishing the victim's identity and explaining his presence at the crime scene. See State v. Parker , 277 Kan. 838, 843-44, 89 P.3d 622 (2004) (video evidence that incidentally showed that victim had daughter was not gratuitous or inflammatory, evidence was relevant to corroborate other witness testimony and show the crime scene). Because counsel's objection would have been unavailing, his failure to make it was not deficient performance.

Finally, Breedlove argues Sullivan failed to lodge contemporaneous and specific objections in order to preserve issues for appeal and that failure resulted in this court declining to review several claims on appeal. The Court of Appeals found that Breedlove's complaint on this issue was based on conclusory statements without specifically identifying the instances in the record where Sullivan failed to object. Breedlove IV , 2017 WL 3001360, at *8. As stated above, assertions of ineffectiveness must be based on more than conclusory statements. Sola-Morales , 300 Kan. at 881-82, 335 P.3d 1162. More importantly, however, Breedlove fails to demonstrate how the outcome of the trial would have been different if the objections had been made; our review of the record indicates that it would not have been different. See Strickland , 466 U.S. at 687, 104 S.Ct. 2052.

After analyzing all of the claims of ineffectiveness against Craft, Palmer, and Sullivan, Breedlove fails to carry his burden to show that their performances were deficient and does not show how the outcome of his trial was prejudiced by their performances.

IMPOSITION OF $195 FILING FEE FOR DISPOSITIVE MOTION

Breedlove filed his 60-1507 motion on September 4, 2013; he also filed an affidavit of indigency, supporting financial documentation, and a motion to proceed in forma pauperis.

On June 5, 2015, K.S.A. 2015 Supp. 60-2008 became effective, which establishes a $195 fee for "any party filing a dispositive motion" in civil matters. The record does not give a precise date, but also in June 2015, after the effective date of this statute, Breedlove attempted to file a "Motion for Summary Disposition." The district court refused to accept the filing because it was not accompanied by the newly mandated $195 fee. Breedlove later was able to file the motion, accompanied by the $195 fee.

Standard of Review

This question involves interpretation of K.S.A. 2015 Supp. 60-2008 and other statutes; interpretation of statutes is a question of law subject to unlimited review. Neighbor v. Westar Energy, Inc. , 301 Kan. 916, 918, 349 P.3d 469 (2015).

Analysis

K.S.A. 2015 Supp. 60-2008 provides:

"(a) On and after the effective date of this act, any party filing a dispositive motion shall pay a fee in the amount of $195 to the clerk of the district court. A poverty affidavit may be filed in lieu of payment of such fee , as established in K.S.A. 60-2001, and amendments thereto. The fee shall be disbursed in accordance with K.S.A. 20-362, and amendments thereto. The fee shall only be established by an act of the legislature and no other authority is established by law or otherwise to collect such fee. Such fee shall be an item allowable as a cost pursuant to K.S.A. 60-2003, and amendments thereto.
"(b) As used in this section, 'dispositive motion' means a motion to dismiss, a motion for judgment on the pleadings, a motion for summary judgment or partial summary judgment or a motion for judgment as a matter of law. 'Dispositive motion' also shall include any motion determined by a judge to be seeking any disposition described in this subsection, regardless of the title assigned to such motion at the time of filing." (Emphasis added.)

This court has not had cause to consider this statute since its enactment, and it is not altogether clear that Breedlove's pro se pleading, attempting to get the district court to take action upon his two-year-old 60-1507 motion, is of the type intended to be designated as a "dispositive motion" under K.S.A. 2015 Supp. 60-2008(b). But Breedlove does not challenge the imposition of the fee on that basis. Rather, he asks us to review the Court of Appeals' holding that Breedlove did not fit within the specific statutory exception in subsection (a), i.e., a poverty affidavit may be filed in lieu of paying the filing fee.

The panel faulted Breedlove for failing to file a poverty affidavit with the motion for summary disposition. But, as noted above, Breedlove had already filed a poverty affidavit with his original 60-1507 motion, pursuant to K.S.A. 60-2001, the same statute referred to in K.S.A. 2015 Supp. 60-2008(a). When the district court accepted and docketed this case, it necessarily accepted the veracity of the affidavit and supporting documentation. Consequently, the district court demanded a $195 fee to file a prisoner's pleading in a case in which the court had already determined the prisoner to be indigent.

The panel dealt with this anomaly in two ways. First, it determined that Breedlove had not preserved his challenge to the filing fee by objecting in the district court. But then the panel went on to consider the efficacy of the assessment in light of the prior poverty affidavit. In that regard, the panel opined that the $195 fee was being assessed against the dispositive motion, not the 60-1507 motion, and that the fee did not relate to Breedlove's sentence, which a 60-1507 is designed to challenge. Breedlove IV , 2017 WL 3001360, at *8-9.

With respect to preservation, the State did not cross-petition for review, claiming the panel erred in considering the merits of Breedlove's filing-fee argument, after declaring the issue abandoned. Moreover, Supreme Court Rule 8.03(b)(6)(C)(i) states that the Supreme Court "may address a plain error not presented." (2019 Kan. S. Ct. R. 55.) Demanding another docketing fee in a case that was opened with a poverty affidavit in lieu of docketing fee was plain error.

The panel treated this case as if it were two proceedings involving two docketing fees under K.S.A. 2015 Supp. 60-2001. To the contrary, there was but one proceeding with one case number. Accordingly, the dispositive motion fee was more akin to a court cost in the 60-1507 proceeding. Indeed, K.S.A. 2015 Supp. 60-2008(a) specifically provides that "[s]uch fee shall be an item allowable as a cost pursuant to K.S.A. 60-2003, and amendments thereto." Consequently, the district court erred in refusing to file Breedlove's motion for summary disposition based upon the existing poverty affidavit in lieu of the $195 filing fee. We remand with directions to refund the filing fee.

CONCLUSION

We affirm the district court's summary denial of Breedlove's motion. The State's filing of a written response to the 60-1507 motion did not, standing alone, trigger Breedlove's statutory right to counsel; the district court's adoption of the State's response as its findings of fact and conclusions of law is not reversible error; and Breedlove's substantive claims regarding the effectiveness of his trial counsel fail because Breedlove fails to show how counsel's performance was deficient and fails to demonstrate any prejudice to the outcome of his trial. However, the district court's imposition of the $195 filing fee for the dispositive motion, pursuant to K.S.A. 2015 Supp. 60-2008, was erroneous because Breedlove had filed a poverty affidavit pursuant to K.S.A. 2015 Supp. 60-2001. We reverse the district court on the imposition of the fee.

Affirmed in part, reversed in part, and remanded with directions.

Stegall, J., concurring:

I join the majority opinion in all respects but one. I concur in the court's holding that there was no separation of powers violation, though I do not agree with the majority's rationale. I do not think that "because the State's attorney was acting as an officer of the court, there is no violation of the separation of powers." Op. at 1107. Instead, I would hold that there was no separation of powers violation because, as the majority recites elsewhere, "Breedlove failed to carry his burden to show that the district court did not do what it was supposed to do, i.e., conduct an independent review of the record." Op. at 1106 (citing Breedlove v. State , No. 115,401, 2017 WL 3001360, at *3 [Breedlove IV ] ). This means, necessarily, that there is no indication in the record that the judicial branch "shared" its exclusive governing function with any other branch of government.

The majority opinion, by relying instead on the notion that a prosecuting attorney is an officer of the court, suggests that a prosecuting attorney can constitutionally carry out a judicial function because "there is some overlap between the powers of the various branches of government and ' "separation of powers of government has never existed in pure form except in political theory." ' " Op. at 1106. I strongly disagree.

I have previously critiqued our separation of powers jurisprudence-in particular the pernicious notion of "overlapping" and "shared" powers that must be "harmonized" to give government "sufficient flexibility to experiment and to seek new methods of improving governmental efficiency." State, ex rel. Schneider v. Bennett , 219 Kan. 285, 289, 547 P.2d 786 (1976). See Solomon v. State , 303 Kan. 512, 538, 364 P.3d 536 (2015) (Stegall, J., concurring) (criticizing the rule that "the constitutional separation of powers can essentially be waived by the departments of government whenever they find such separation an inconvenient impediment to some sought-after governmental end misapprehends and may fatally undermine the fundamental purpose of such walls of separation in the first instance-to prevent the 'gradual concentration of the several powers in the same department' which 'may justly be pronounced the very definition of tyranny.' [James Madison, The Federalist No. 51, p. 321 and No. 47, p. 301 (C. Rossiter ed. 1961) ].").

As I have written:

"I would return this court to the active judicial role and obligation to guard and protect a clear and strong wall of separation between each of the three great departments of government-keeping each within its proper province and protecting those provinces from colonization by the other two departments. It is within the judicial province to carefully exercise this power without deference to the other branches, and it is the duty of our department to carry out this obligation without regard to whether the results are perceived to be either beneficial or detrimental to judicial interests or other sub-constitutional interests such as what we (or any other government official) decide is 'practicable' or 'efficient.' " Solomon , 303 Kan. at 545, 364 P.3d 536 (Stegall, J., concurring).

Moreover, the slide into permitting prosecutors to exercise judicial or even quasi-judicial functions is not an innocent one and may have deleterious real-world consequences. See State v. Ingham , 308 Kan. 1466, 1483, 430 P.3d 931 (2018) (Stegall, J., concurring) (explaining that giving prosecutors "the authority to decide what the law is ... gives rise to doubts about whether such laws violate the doctrine of separation of powers" and " 'invite[s] arbitrary power' " into the criminal justice system); Kisor v. Wilkie , No. 18-15, 2019 WL 2605554, at *27, 588 U.S. ----, ----, 139 S. Ct. 2400, --- L.Ed. 2d ---- (filed June 26, 2019) (Gorsuch, J., concurring) (allowing an agency to "both write and interpret rules that bear the force of law" unites "powers the Constitution deliberately separated and den[ies] the people their right to an independent judicial determination of the law's meaning"); Gundy v. United States , No. 17-6086, 2019 WL 2527473, at *21, 588 U.S. ----, ----, 139 S. Ct. 2116, 204 L.Ed. 2d 522 (filed June 20, 2019) (Gorsuch, J., dissenting) (arguing that allowing the Attorney General to enforce an Act while also allowing the Attorney General to rule when and to whom the Act applies "would be to mark the end of any meaningful enforcement of our separation of powers and invite the tyranny of the majority that follows"); Sessions v. Dimaya , 584 U.S. ----, 138 S. Ct. 1204, 1228, 200 L.Ed. 2d 549 (2018) (Gorsuch, J., concurring in part and concurring in judgment) (overlooking the separation of powers between branches leaves "prosecutors free to 'condem[n] all that [they] personally disapprove and for no better reason than [they] disapprove it' ").

For these reasons, I would hold that on the one hand, there is no evidence in this case that the prosecutor exercised a judicial power. On the other hand, I would be more vigilant to police this important governmental boundary-rather than permit its blurring on the suspect notion that because a prosecutor is an "officer of the court" he or she is necessarily engaged in carrying out an "overlapping" power.