In Keeton v. State of Alaska, No. 7366 (May 24, 2019), the Alaska Supreme Court held that a property owner is entitled to interest only on the "amount awarded" -- the difference between the quick-take deposit and the eventual final judgment of compensation -- and not on that amount plus the statutory attorneys' fees which the court awarded.
You might have guessed how this one was going to play out, given the usual approach of not including attorneys' fees and costs within the meaning of just compensation, and the purpose of "interest" being to compensate for the delay in payment of comp (not fees) after the condemnor has actually taken the property. But let's go through the steps.
Quick take, deposit $15k. Final award of compensation, $24k. Fees of $47k, and costs of $32k awarded to the owner by statute. Also by statute, the court awarded prejudgment interest "on the difference between the amount of DOT's initial deposit and the amount the property was ultimately determined to be worth." Slip op. at 2.
Owner said thank you, but that's not enough. The statute says I get interest on the "amount finally awarded," and that also includes the $79k in fees and costs I also was awarded. Slip op. at 6 ("under this argument the gap between the amount deposited and the amount awarded is $61,429.12 rather than $6,440") (footnote omitted).
The court disagreed, concluding that the statute only required interest be awarded on the excess compensation, not the total amount including attorneys' fees. The statute speaks in terms of "compensation," which means for the property taken, not for legislative gravy like attorneys' fees (the court's thoughts, not ours):
All these statutes defining compensation and directly addressing its deposit and award focus on the value of the property or damage to other property; none of them mentions attorney’s fees and costs. We conclude that the “amount finally awarded” means “compensation,” which in this statutory context means the value of the property plus incidental damages but does not include attorney’s fees and costs.
Slip op. at 11.
There's more supporting rationale in the opinion, of course, but you can read that yourself if you like.
Keeton v. State of Alaska, No. 7366 (Alaska May 24, 2019)
