Vermillion State Bank, Plaintiff-Petitioner Below, Faegre Baker Daniels, Respondent,
State of Minnesota, by its Department of Transportation, Appellant.
County District Court File No. 19HA-CV-15-971
M. Jann, Bruce Jones, Faegre Baker Daniels LLP, Minneapolis,
Minnesota (for respondent)
Swanson, Attorney General, Stephen D. Melchionne, Assistant
Attorney General, Jeffery S. Thompson, Assistant Attorney
General, St. Paul, Minnesota (for appellant)
Patrick B. Steinhoff, Malkerson Gunn Martin LLP, Minneapolis,
Minnesota; and Leland J. Frankman, Frankman Law Offices,
Minneapolis, Minnesota (for amicus curiae Minnesota Eminent
Considered and decided by Worke, Presiding Judge; Halbrooks,
Judge; and Jesson, Judge.
Stat. § 117.045 (2016) entitles a landowner who
successfully brings an inverse condemnation action to
petition the court for attorney fees and other costs; the
landowner's attorney has no standing to petition for fees
and costs directly and independently of the landowner.
challenges the district court's award of attorney fees
and other costs directly to respondent law firm under Minn.
Stat. § 117.045. Because respondent did not have
statutory standing to petition for fees directly and
independently of plaintiff-petitioner, its former client, we
2012, appellant State of Minnesota Department of
Transportation (MnDOT) permanently closed a restaurant's
only access to a state highway. The restaurant's owners
had purchased the property with the assistance of a mortgage
loan from plaintiff-petitioner Vermillion State Bank
(Vermillion). Within months, loss of highway access forced
the restaurant to close. The restaurant owners were no longer
able to pay the mortgage, and Vermillion foreclosed on the
January 2014, Vermillion retained respondent Faegre Baker
Daniels (Faegre) to represent it in an inverse condemnation
action against MnDOT. Faegre conducted title work to
establish the exact physical location of the property,
conducted extensive legal research, sent a demand letter, and
drafted pleadings. In February 2015, Vermillion, pointing to
a "lack of progress" on the case, terminated its
agreement with Faegre and hired Larkin Hoffman Daly &
Lindgren Ltd. (Larkin Hoffman). As directed by Vermillion,
Faegre forwarded its work to Larkin Hoffman. Shortly
thereafter, Larkin Hoffman filed a summons and complaint that
were substantially identical to the pleadings prepared by
December 2015, the district court granted Vermillion's
motion for summary judgment and ordered MnDOT to commence
condemnation proceedings. Faegre filed a motion for $63,
495.50 in attorney fees and $368.46 in costs under Minn.
Stat. § 117.045. Vermillion also filed a motion for
attorney fees, seeking reimbursement for $55, 416.19 in fees
and costs incurred while it was represented by Larkin
Hoffman. Vermillion did not request any fees for the work
performed by Faegre and informed Faegre that it would not pay
Faegre directly. Vermillion maintains that Faegre is not
entitled to fees because it was hired on a contingent
basis-meaning that it would be paid only if it successfully
prosecuted the inverse condemnation action-and fired before
the inverse condemnation action was commenced. MnDOT agreed
to pay Larkin Hoffman's fees but argued that Faegre had
no standing to bring a motion for attorney fees because Minn.
Stat. § 117.045 allows only the landowner to petition
the court for reimbursement; it does not allow an attorney to
make a direct claim for fees.
district court ordered MnDOT to pay Faegre $52, 065 in
attorney fees and $368.46 in other costs. It rejected
MnDOT's claim that Faegre lacked standing to petition ...