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You can search the entire site. or go to the recent opinions, or the chronological or subject indices. Cottini v. Berggren (6/15/2018) sp-7250

Cottini v. Berggren (6/15/2018) sp-7250

           Notice:   This opinion is subject to correction before publication in the P                    ACIFIC  REPORTER.  

           Readers are requested to bring errors to the attention of the Clerk of the Appellate Courts,  

                                                                                                                        

           303 K Street, Anchorage, Alaska 99501, phone (907) 264-0608, fax (907) 264-0878, email  

                                                                                                                           

           corrections@akcourts.us.  



                       THE SUPREME COURT OF THE STATE OF ALASKA                                       



MARC  COTTINI,                                                       )  

                                                                     )      Supreme  Court  No.  S-16312  

                                Appellant,                           )  

                                                                                                                                      

                                                                     )      Superior Court No. 3AN-13-01828 PR  

           v.                                                        )  

                                                                                                

                                                                     )     O P I N I O N  

                                   

JOHN BERGGREN and                                                    )  

                

OLENA BERGGREN,                                                                                               

                                                                     )     No. 7250 - June 15, 2018  

                                                                     )  

                                Appellees.                           )  

                                                                     )  



                                                                                                              

                                   

                      Appeal from the Superior Court of the State of Alaska, Third  

                                                                                                         

                      Judicial District, Anchorage, Catherine M. Easter, Judge.  



                                                                                                             

                      Appearances:               Susan  Orlansky,  Reeves  Amodio  LLC,  

                                                                                                                    

                      Anchorage, for Appellant. Christina M. Passard, Woelber &  

                                                                                           

                      Passard, LLC, Anchorage, for Appellees.  



                                                                                                           

                      Before:  Stowers, Chief Justice, Winfree, Maassen, Bolger,  

                                           

                      and Carney, Justices.  



                                                     

                      STOWERS, Chief Justice.  



I.         INTRODUCTION  



                                                                                                                              

                      Aformer agent, appointed under apower ofattorney,successfully defended  



                                                                                                                      

an accounting of his actions, expenditures, and fees against objections and counterclaims  



                                                                                                                                    

by his former principal.  In this appeal we are asked to resolve whether the former agent  



                                                                                                                                      

is entitled to reimbursement from his former principal for reasonable attorney's fees  



                                                                                                                                        

incurred in maintaining that defense.  The superior court denied the agent's request for  


----------------------- Page 2-----------------------

attorney's fees because the dispute occurred in the context of a guardianship proceeding                                                                                                                                         



and because the request did not meet the requirements of AS 13.26.291, which governs                                                                                                                                                      



cost-shiftinginguardianshipproceedings. Theagent                                                                                                           appeals, arguing that AS 13.26.291  



does not apply, that he is entitled to attorney's fees based on his authority as an agent to                                                                                                                                                                



hire an attorney under                                             AS 13.26.665(m), and that he is entitled to attorney's fees based                                                                                                             



on common law principles, equity, and considerations of public policy.                                                                                                                                                   We conclude   



that neither statute applies, but that the agent may be entitled to reimbursement of his                                                                                                                                                                 



attorney's fees under the common law of agency and as a matter of equity. We therefore                                                                                                                                                 



reverse the superior court's order and remand for further proceedings.                                                                                                     



II.                 FACTS AND PROCEEDINGS                       



                                        John Berggren                                  is an             Anchorage resident with                                                       business and                              real estate   



interests worth over $12 million.                                                                       He executed a general power of attorney in 2007                                                                                           



                                                                                                                                                                                   1  

naming Marc Cottini as his attorney-in-fact - his legal agent                                                                                                                                                                              

                                                                                                                                                                                      - in the event he became  



                                                                                                                                                                                                                                                        

incapacitated.  Berggren suffered a traumatic brain injury in July 2013, triggering the  



                                                                                                                                                                                                                                      

power of attorney.   After the accident Berggren's attorney, David Shaftel, informed  



                                                                                                                                                                                                                                                      

Cottini that he had been named Berggren's agent. Shortly after Cottini assumed his role  



                                                                                                                                                                                                                                

as agent, Berggren's wife Olena filed a petition for guardianship.  Acting as Berggren's  



                                                                                                                                                                                                                                                     

agent, Cottini opposed the guardianship petition on Berggren's behalf.  Over the next  



                                                                                                                                                                                                                                        

eight  months,  Cottini  acted  as  Berggren's  agent  until,  after  court-ordered  medical  



                                                                                                                                                                                                                                                    

examinations concluded that Berggren had regained the capacity to manage his own  



                                                                                                                                                                                                

affairs, the court terminated the agency.   Olena withdrew her guardianship petition  



                                                                                                                                                                                                                                                       

shortly afterwards. The court ordered Cottini to produce an accounting of his actions and  



                                                                                                                                                                                                                                       

expenditures during the time of his agency, which he did with the assistance of Shaftel's  



                                                                                                                                                                                                         

law firm.  Shaftel represented Cottini in his capacity as Berggren's agent.  



                    1  

                                                                                                                                                                                                                                  

                                        We use the term "agent" to refer to Cottini's relationship with Berggren.  



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                                     The accounting requested the court approve $71,683.57 as Cottini's fees                                                                                                                      



and costs for acting as Berggren's agent. This included compensation for Cottini's time                                                                                                                                          



at a rate of $50 per hour. Cottini later declared that the accounting showed he processed                                                                                                                         



transactions involving $1,064,947 including handling Berggren's personal and joint                                                                                                                                              



expenses and paying invoices amounting to $242,263.                                                                                                     Berggren objected to Cottini's  

                                2  arguing that Cottini's actions were not taken to advance Berggren's best  

accounting,                                                                                                                                                                                                                       



interests, and that Cottini's fees were excessive.  

                                                                                                       



                                     Berggren also filed counterclaims alleging breach of Cottini's fiduciary  

                                                                                                                                                                                                                    



duties and listing objections to specific requested fees and costs.  Cottini hired a second  

                                                                                                                                                                                                                        



attorney, Diane Vallentine, who appeared before the court "for the sole purpose of  

                                                                                                                                                                                                                                       



representing Mr. Cottini with regard to the Joint Objection to Accounting of Agent's  

                                                                                                                                                                                                                       



Fees."  Documents filed with the court consistently identified Shaftel as representing  

                                                                                                                                                                                                           



Cottini in his capacity as agent and Vallentine as representing Cottini individually;  

                                                                                                                                                                                                         



despite making  this distinction,  the  two  attorneys consistently  cosigned  filings  and  

                                                                                                                                                                                                                                  



worked together.  

                       



                                     Eventually,   the   parties   settled.                                                                Berggren   agreed   to   dismiss   the  

                                                                                                                                                                                                                                 



counterclaims with prejudice, withdrew the objections, and agreed to pay most of what  

                                                                                                                                                                                                                                



Cottini had initially requested; Cottini agreed to accept a slightly reduced total amount  

                                                                                                                                                                                                                         



in fees and reimbursement in exchange for prompt payment.  The parties reserved all  

                                                                                                                                                                                                                                      



issues regarding attorney's fees for decision by the court.  

                                                                                                                                             



                                     Shortly thereafter, Cottini filed a motion asking the court to award him  

                                                                                                                                                                                                                                  



$148,254 in attorney's fees incurred for Vallentine's work in assisting himin responding  

                                                                                                                                                                                                               



                  2  

                                     The objections were filed jointly by both John and Olena Berggren, as were                                                                                                                 

all their subsequent briefs and arguments both before the superior court and on appeal.                                                                                                                                                         

Because of their common claims, and for ease of reference, we refer to the Berggrens                                                                                                                            

collectively as "Berggren."              



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----------------------- Page 4-----------------------

to Berggren's objections and in defending against Berggren's counterclaims.                                                                                               Cottini  



argued that as the appointed agent he was required to prepare an accounting of his                                                                                                  



actions, expenditures, and fees and that he was entitled to full payment of the attorney's                                                                           



fees he incurred in successfully defending the accounting under the power of attorney                                                                                    

                                                                                       3 which outlines a statutory agent's authority to  

statute, specifically AS 13.26.665(m)(4),                                                                                                                                              



hire  and  compensate  attorneys.                                           Cottini  also  contended  that  attorney's  fees  were  

                                                                                                                                                                               



warranted because Berggren had objected to the accounting in bad faith, and defending  

                                                                                                                                                                     



the  accounting  was  necessary  to  make  Cottini  whole  for  his  time  and  financial  

                                                                                                                                                                      



expenditures and to ensure third parties would not go unpaid.  Berggren opposed the  

                                                                                                                                                                                    



motion for attorney's fees, arguing that AS 13.26.665(m) did not apply because the legal  

                                                                                                                                                                                



services at issue benefited Cottini, not Berggren; that while the objections to Cottini's  

                                                                                                                                                                       



accounting were ultimately withdrawn, those objections were reasonable; and that the  

                                                                                                                                                                                    



attorney's fees Cottini incurred were unreasonable.   Berggren also argued that any  

                                                                                                                                                                                  



request for legal fees should have been made under the fee-shifting provisions of Alaska  

                                                                                                                                                                            



Civil Rule 82.  

                        



                             The superior court denied Cottini's motion for attorney's fees.  The court  

                                                                                                                                                                               



held that AS 13.26.665(m)(4) did not apply to the fee request because the statute allows  

                                                                                                                                                                             



reimbursement only for attorney's fees incurred for services to the principal that the  

                                                                                                                                                                                   



agent reasonably believes are desirable for the proper execution of the agent's powers.  

                                                                                                                                                                                            



The  court,  citing  Vallentine's  limited  entry  of  appearance  for  the  sole  purpose  of  

                                                                                                                                                                                     



representing Cottini with regard to Berggren's objections, concluded that none of the  

                                                                                                                                                                                    



attorney representation with respect to Berggren's objections fell within that statutory  

                                                                                                                                                                       



framework.  The court also concluded that Alaska Civil Rule 82 has been displaced by  

                                                                                                                                                                                     



              3  

                                                                                                                                                                                

                             FormerlyAS13.26.344(m)(4), renumbered asAS13.26.665(m)(4) in 2016  

SLA.  



                                                                                          -4-                                                                                         7250  


----------------------- Page 5-----------------------

                                                      4  

AS 13.26.291(d)                                          as the governing rule for fee-shiftingin any guardianship case, and that                                                                                                                                           



this statute required Berggren to pay for Cottini's attorney's                                                                                                                                                fees only if adversary                  



proceedings were initiated maliciously, frivolously, or without just cause.                                                                                                                                                                           The court   



found   that   Berggren   had   not   acted  in  such  a   manner   when   objecting   to   Cottini's  



accounting and that Cottini therefore was not entitled to attorney's fees.                                                                                                                                                                            The court   



denied Cottini's motion and did not rule on any of Berggren's fact-based claims that                                                                                                                                                                                      



some of the fees were excessive or unreasonable.                                                                  



                                           Cottini appeals the single question whether he is entitled to reimbursement                                                                                                                 



for reasonable attorney's fees incurred in defending his actions and expenditures as                                                                                                                                                                                           



Berggren's agent and in defending his requested fees.                                                                                                          



III.                  STANDARD OF REVIEW                                          



                                           "[W]e independently review 'whether the trial court properly applied the                                                                                                                                                          



                                                                                                                        5  

law when awarding attorney's fees.' "                                                                                                                                                                                                                                 

                                                                                                                             "Determinations of which legal authorities apply  



                                                                                                                                                                                                                                                                           

in a case and interpretations of what those legal authorities mean are questions of law  



                                                                                      6  

                                                                                                                                                                                                                                                                              

subject to de novo review."                                                                 When determining the meaning of a statute, we "look to the  



                                                                                                                                                                                                                                                                           

meaning of the language, the legislative history, and the purpose of the statute," and  



                                                                                                                                                                                                                                                                                     7  

                                                                                                                                                                                                                                                           

"adopt the rule of law that is most persuasive in light of precedent, reason, and policy." 



                      4  

                                           Formerly AS 13.26.131(d), renumbered as AS 13.26.291(d) in 2016 SLA.                                                                                                                                                       



                      5  

                                           State, Office of Pub. Advocacy v. Estate of Jean R.                                                                                                                        , 371 P.3d 614, 618                                  

                                                                                                                                                                                                                                                    

(Alaska 2016) (quoting Baker v. Ryan Air, Inc., 345 P.3d 101, 106 (Alaska 2015)).  



                      6                     ConocoPhillips Alaska, Inc. v. Williams Alaska Petroleum, Inc., 322 P.3d  

                                                                                                                                                                                                                                                                         

 114, 122 (Alaska 2014) (footnotes omitted).  

                                                                                                                  



                      7                    Marshall v. First Nat'l Bank Alaska, 97 P.3d 830, 834 (Alaska 2004)  

                                                                                                                                                                                    

(quoting Enders v. Parker, 66 P.3d 11, 13-14 (Alaska 2003)).  

                                                                                                                                                                                



                                                                                                                                       -5-                                                                                                                             7250
  


----------------------- Page 6-----------------------

IV.       DISCUSSION  



                    Cottini argues that the superior court erred in relying on AS 13.26.291 to  

                                                                                                                                 



deny his attorney's fees request because the statute's cost-shifting provisions refer to  

                                                                                                                                 



petitioners and respondents in a guardianship proceeding, and Cottini was neither.  He  

                                                                                                                               



also argues that AS 13.26.665(m) contains specific provisions that govern an agent's  

                                                                                                                         



ability to hire attorneys, and that this statute therefore displaces Alaska Civil Rule 82's  

                                                                                                                             



familiar fee-shifting provisions and entitles him to reasonable attorney's fees incurred  

                                                                                                                       



in successfully defending against the challenges to his accounting because the defense  

                                                                           



also benefited Berggren. Finally, Cottini points to case law and treatises from analogous  

                                                                                                                     



contexts, public policy concerns, and our decision in Marshall v. First National Bank  

                                                                                                                            

            8  all  of  which  he  argues  support  his  construction  of  AS  13.26.665(m),  or  

Alaska ,                                                                                                                        



alternatively support an award of attorney's fees on either common law or equitable  

                                                                                                                      



grounds.  



                    We conclude that AS 13.26.291, which applies in guardianship contexts,  

                                                                                                                      



is inapplicable to the attorney's fees dispute here because this dispute is between an  

                                                                                                                                



agent appointed under the statutory form power of attorney and his principal, not a  

                                                                                                                                  



respondent contesting a guardianship petition brought in bad faith.  We also conclude  

                                                                                                                      



that AS 13.26.665(m), while not inconsistent with the conclusion that an agent is entitled  

                                                                                                                         



to attorney's fees incurred in a successful defense of his accounting, does not provide a  

                                                                                                                                  



controlling rule of decision.  However, we hold that under the substantive common law  

                                                                                                                              



of agency and as a matter of equity, an agent may be entitled to attorney's fees incurred  

                                                                                                                       



in successfully defending his actions, expenditures, and fees, depending on a set of  

                                                                                                                                



factors outlined in this opinion.  

                                    



          8  

                    Id.  



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----------------------- Page 7-----------------------

                         A.	                      Alaska   Statute   13.26.291   Does   Not  Govern   Cottini's   Motion   For  

                                                  Attorney's Fees.   



                                                  Alaska Statute 13.26.291 provides, in relevant part:                                                                                                                            



                                                                           (a)                       Subject to (d) of this section, the state shall bear                                                                                                          

                                                  the    costs    of    the    visitor   and    expert    appointed    under  

                                                  AS 13.26.226(c).   



                                                                           (b)                       Subject to . . . (d) of this section, the respondent                                                                                

                                                  shall    bear    the    costs   of    the    attorney    appointed    under  

                                                  AS 13.26.226(b) . . . and of other court and guardianship                                                                                                                     

                                                  costs incurred under this chapter.                                                            



                                                                            . . . .  



                                                                           (d)                      The court may require the petitioner to pay all                                                                                                                      

                                                  or some of the costs described in (a) and (b) of this section if                                                                                                                                                           

                                                  the court finds that the petitioner initiated a proceeding under                                                                                                                                           

                                                  this chapter that was malicious, frivolous, or without just                                                                                                                                                      

                                                  cause.  



As we recently explained in                                                                                In re Vernon H.                                                , "Alaska Statutes 13.26.[291](a) and (b)                                                                                                      



allocate certain categories of costs in guardianship proceedings to the state, respondent,                                                                                                                                                                                               

                                                           9      Alaska Statute 13.26.291(d), in turn, "enables the court to shift those  

and petitioner."                                                                                                                                                                                                                                                                                                



costs to the petitioner '. . . if the court finds that the petitioner initiated a proceeding  

                                                                                                                                                                                                                                                                                     

under this chapter that was malicious, frivolous, or without just cause.' "10  We also held  

                                                                                                                                                                                                                                                                                                                    



that "fees of privately retained counsel and experts qualify for fee shifting pursuant to  

                                                                                                                                                                                                                                                                                                                             

AS 13.26.[291](d) if the other requirements of that subsection are also satisfied,"11  and  

                                                                                                                                                                                                                                                                                                                      



                         9  

                                                  332 P.3d 565, 572 (Alaska 2014).                                                                       



                         10  

                                                  Id.  (quoting former AS 13.26.131(d)).                                                   



                         11  

                                                  Id.  at 573.   



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----------------------- Page 8-----------------------

that AS 13.26.291(d) therefore "entirely displaces Civil Rule 82" and "forecloses any                                                                        



                                                                                                                                        12  

role for Civil Rule 82 in the guardianship and conservatorship context."                                                                    



                         The superior court concluded that AS 13.26.291(d) was the applicable  

                                                                                                                                                



standard for determining which party was responsible for the attorney's fees in this case,  

                                                                                                                                                           



relying on our ruling in In re Vernon H.  Berggren argues that AS 13.26.291 governs  

                                                                                                                                                     



because the case now before us was initiated by a guardianship petition, Cottini was an  

                                                                                                                                                                



activeparticipant in the guardianship case, and Cottini filed hismotionfor attorney's fees  

                                                                                                                                                             



in the guardianship case. Berggren also argues that Cottini's fees request falls within the  

                                                                                                                                                              



statute's provisions because of our holding in In re Vernon H.  that fees of privately  

                                                                                                                                                   



retained  counsel  are  covered  by  AS  13.26.291,  and  because,  as  Berggren  puts  it,  

                                                                                                                                                               



subsection (b) of that statute "provides for the bearing of costs for 'other court and  

                                                                                                                                                             

                                                                                             13   We disagree.  

guardianship costs incurred under this chapter.' "                                                         

                                                                                            



                         Our explanation in In re Vernon H. of how AS 13.26.291 operates makes  

                                                                                                                                                        



clear that this statute is inapplicable to this attorney's fees dispute.  As we explained,  

                                                                                                                                                



"Alaska  Statutes  13.26.[291](a)  and  (b)  allocate  certain  categories  of  costs  in  

                                                                                                                                                              

guardianship  proceedings  to  the  state, respondent, and petitioner."14                                                                 And  "Alaska  

                                                                                                                                                    



Statute 13.26.[291](d) enables the court to shift those costs to the petitioner  '. . . if the  

                                                                                                                                                              



court  finds  that  the petitioner  initiated  a  proceeding  under  this  chapter  that  was  

                                                                                                                                                            

malicious, frivolous, or without just cause.' "15                                         Cottini is not a respondent seeking fees  

                                                                                                                                                             



from a petitioner who initiated a guardianship proceeding, maliciously or otherwise. He  

                                                                                                                                                               



is an agent appointed under a statutory form power of attorney seeking reimbursement  

                                                                                                                                        



             12  

                         Id.  at 577.   



             13  

                                 

                         AS 13.26.291(b).  



             14  

                                                                                                              

                         In re Vernon H., 332 P.3d at 572 (emphasis added).  



             15  

                                                                                                         

                         Id. (emphasis added) (quoting former AS 13.26.131(d)).  



                                                                               -8-                                                                        7250
  


----------------------- Page 9-----------------------

from his principal for the cost of defending his actions, expenditures, and fees. Although                                                                                                  



Cottini requested attorney's fees for privately retained counsel, and                                                                                            In re Vernon H.                        held  



that fees of privately retained counsel are covered by AS 13.26.291(d), that holding was                                                                                                                  



                                                                                                                                                                                                               16  

made   in   the   context   of   a   respondent   who   was   opposing   a   guardianship   petition.                                                                                                                



Reading In re Vernon H. to include the attorney's fees sought in this principal-agent case  

                                                                                                                                                                                                         



would  require  ignoring  the  plain  language  of  AS  13.26.291.                                                                                               Unlike  with  private  

                                                                                                                                                                                                 



attorney's fees sought by a respondent in a guardianship case, there is no textual basis  

                                                                                                                                                                             



for applying AS 13.26.291 to an agent seeking reimbursement from his principal for  

                                                                                                                                                                                                           



attorney's fees incurred in defending his accounting.  

                                                                                                    



                                 The   superior   court's   factual   analysis   also   illustrates   the   statute's  

                                                                                                                                                                                            



incompatibility with this case.  The court's analysis was not focused on whether Olena  

                                                                                                                                                                                                    



Berggren's initialdecision to initiateaguardianshipproceedingwas frivolous,malicious,  

                                                                                                                                                                                          

or without cause, as AS 13.26.291 directs.17                                                                         Instead, it analyzed the opposition to  

                                                                                                                                                                                                             



Cottini's accounting, implicitly recognizing that the real underlying matter at issue was  

                                                                                                                                                                                                         



not the guardianship petition, but rather the dispute over whether Cottini had acted  

                                                                                                                                                                                                     



properly as an agent and was entitled to the agent's fees he requested.   It is entirely  

                                                                                                                                                                                                



coincidental that Cottini's request arose within the context of a guardianship proceeding,  

                                                                                                                                                                                       



and we conclude that AS 13.26.291 does not provide the applicable rule of decision in  

                                                                                                                                                                                                              



this dispute.  

           



                16  

                                Id.  at 577.               



                17  

                                AS 13.26.291(d) ("The court may require the petitioner to pay all or some                                                                                             

of the costs described in (a) and (b) of this section if the court finds that the petitioner                                                                                               

initiated a proceeding under this chapter that was malicious, frivolous, or without just  

                                                                                                                                                                                                          

cause.").    



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----------------------- Page 10-----------------------

                                                                                                                                    

          B.	        Alaska Statute 13.26.665(m) Does Not Apply To This Dispute But Is  

                                                                                                            

                     Not Inconsistent With Awarding Cottini Attorney's Fees.  



                                                                                                                                        

                     Alaska Statute 13.26.665 provides rules of construction for the statutory  



                                                                                                                                        

power of attorney form set out in AS 13.26.645.   Berggren used the statutory form.  



                                                                              

Alaska Statute 13.26.665(m) provides in relevant part:  



                                                                                                  

                     In   a   statutory   form   power   of   attorney,   the   language  

                                                                                                       

                     conferring general authority with respect to records, reports,  

                                                                                                       

                     and statements shall be construed to mean that, with respect  

                                                                                                             

                     to a record, report, or statement concerning the affairs of the  

                                                                                               

                     principal, . . . the principal authorizes the agent to  



                                                                                                              

                               (1)       keep records of cash received and disbursed for  

                                                                                                             

                     or on account of the principal, of all credits and debits to the  

                                                                                                             

                     account of the principal, and of all transactions affecting the  

                                                               

                     assets and liabilities of the principal;  



                                      

                               . . . .  



                                                                                                   

                               (4)       hire,  discharge,  or  compensate  an  attorney,  

                                                                                                     

                     accountant, or assistant when the agent reasonably believes  

                                                                                                             

                     the action to be desirable for the proper execution of  the  

                                                                               

                     powers described in this subsection; and  



                                                                                                              

                               (5)       do any other act or acts that the principal can do  

                                                                                              

                     through   an   agent   in   connection   with   the  preparation,  

                                                                                                       

                     execution, filing, storage, or other use of any records, reports,  

                                                                                             

                     or statements of or concerning the principal's affairs.  



                                                                                                                     

                     Cottini asserts on appeal that just as AS 13.26.291 removed the fee-shifting  



                                                                                                                                  

dispute in the guardianship case at issue in In re Vernon H. from the scope of Rule 82,  



                                                                                                                                 

AS  13.26.665(m)  does  the  same  in  this  case.                           This  is  so,  he  argues,  because  AS  



                                                                                                                              

13.26.665(m)(4) "expressly governs the ability of an agent to retain an attorney to assist  



                                                                                                                                  

him regarding reports concerning the affairs of the principal" and because Rule 82  



                                                                                                                                  

applies only when an alternate fee-shifting framework is not "otherwise provided by  



                                                                -10-	                                                         7250
  


----------------------- Page 11-----------------------

                                                                                                                                 

law."  Accordingly, he argues that we should hold that AS 13.26.665 displaces Rule 82  



                                                                                       

when an agent seeks to recover attorney's fees from his principal.  



                                                                                                                                  

                    More specifically, Cottini argues that subsection (m)(1) authorized him to  



                                                                                                                          

prepare  an  accounting  of  his  handling  of  Berggren's  affairs  and  subsection  (m)(4)  



                                                                                                                             

explicitly authorized Cottini toretain andcompensatean attorneyusingBerggren's funds  



                                                                                                                                  

when he reasonably believed this was desirable for the proper execution of his power as  



                                                                                                                                  

Berggren's agent to prepare and submit an accurate accounting.  Berggren appears to  



                                                                                                                      

agree, conceding that Shaftel was entitled to compensation from Berggren for preparing  



                                                                                                                                  

the accounting.  But Cottini argues further that under AS 13.26.665(m)(4) and (5), he is  



                                                                                                                                

also entitled to be reimbursed for retaining Vallentine to assist him in defending the  



accounting.  



                                                                                                                                 

                    Berggren  responds  that  AS  13.26.665(m)  does  not  entitle  Cottini  to  



                                                                                                                         

attorney's fees incurred in defending theaccounting because only Shaftel, as the attorney  



                                                                                                                            

who prepared the accounting, was hired pursuant to Cottini's authority as an agent under  



                                                                                                                          

the power of attorney and AS 13.26.665(m)(1) and (4).  Therefore, Berggren argues,  



                                                                                                                                 

although Cottini would be entitled to reimbursement for Shaftel's fees, he would not be  



                                              

entitled to reimbursement for Vallentine's.  



                                                                                                                                

                    The statute does not help resolve this issue, for several reasons.  First, the  



                                                                                                                    

dispute hinges on whether retaining Vallentine to assist with responding to Berggren's  



                                                                                                                                

objections  to  Cottini's  accounting  was  within  the  scope  of  Cottini's  powers  as  



                                                                                                                               

Berggren's agent. Cottini certainly had the power to "keep records of cash received and  



                                                                                                                                

disbursed for or on account of the principal, of all credits and debits to the account of the  



                                                                                                                                  

principal, and of all transactions affecting the assets and liabilities of the principal," as  



                                                                                                                                

well as to "hire [and] compensate an attorney . . . when [he] reasonably believe[d] the  



                                                               -11-                                                         7250
  


----------------------- Page 12-----------------------

                                                                                                                                                     18  

action   to   be   desirable   for   the   proper   execution   of   [this   power]."                                                                       But  the   proper  



preparation of an agent's accounting is distinct from the defense of that accounting when                                                                                           



challenged by the principal, and the latter does not clearly fall within the scope of the                                                                                               



statute.    



                              Second, even assuming that retaining Vallentine was within the scope of                                                                                      



Cottini'sauthority as agent, AS 13.26.665 contains no provisions actually relating tofee-                                                                                              



shifting or reimbursement.                                   The statute instructs courts on how to construe the powers  

                                                                                                                                  19   Where the statutory form  

of an agent outlined in the statutory form power of attorney.                                                                                                                        



is used to appoint an agent, the statute ensures that the agent has the authority to hire and  

                                                                                                                                                                                        

compensate an attorney on the principal's behalf while acting as agent.20   But the statute  

                                                                                                                                                                                 



contains no provisions  obliging the principal to reimburse a former agent even for  

                                                                                                                                                                                        

                                                                                    21   That is not to say that the principal has no such  

indisputably appropriate expenditures.                                                                                                                                               

                                                        



obligation, just that one does not arise from AS 13.26.665.  

                                                                                                          



                              Therefore, while the text of AS 13.26.665 says nothing to suggest Cottini  

                                                                                                                                                                                



is not entitled to reimbursement for attorney's fees incurred in the successful defense of  

                                                                                                                                                                                           



               18  

                             AS 13.26.665(m)(1), (4).                         



               19  

                                                                                                                                                                           

                              Every subsection of AS 13.26.665 begins with the language "In a statutory  

                                                                                                                                                                                          

form power of attorney, the language conferring general authority with respect to . . . [a  

                                                                                                                                                                                   

specific topic] . . . shall be construed to mean that . . . the principal authorizes the agent  

                                                                                                                                                                                              

to . . . ," followed by a list of more specific powers falling within the topic addressed.  



               20            AS 13.26.665(m)(4).  

                                      



               21            A number of provisions in the statute allow agents to reimburse themselves  

                                                                                                                                                                       

"for an expenditure properly made in the execution of the [agent's] powers."  E.g.,  

                                                                                                                                                                                    

AS 13.26.665(a)(6), (b)(5), (c)(7).  But none of these provisions relate to a principal  

                                                                                                                                                                          

reimbursing  a  former  agent  for  such  expenditures  after  the  end  of  the  agency  

                                                                                                                                                                              

relationship.  



                                                                                           -12-                                                                                     7250
  


----------------------- Page 13-----------------------

his accounting, these fees do not clearly fall within its scope, and the statute by itself                                                                                                    



does not require that Berggren reimburse Cottini for them.                                                                  



             C.	               Under   The   Common   Law   Of   Agency,   An   Agent   Is   Entitled   To  

                               Reasonable Attorney's Fees Incurred In Successfully Defending His                                                                                                 

                               Accounting If That Defense Benefited The Principal.                                                        



                               A power of attorney, such as the statutory form Berggren executed, is a                                                                                                 



legal instrument granting authority to an agent to act on behalf of the principal who                                                                                                          



                            22  

executed it.                                                                                                                                                         

                                    Berggren's power of attorney established a fiduciary principal-agent  



                                                                                                                                                                                              

relationship  between  Berggren  and  Cottini and  created  duties between them.                                                                                                               This  



                                                                                                                                                                                      

relationship is subject tobothlegislativeenactments, likeAS13.26.665,andthecommon  



                                                                                                                                                                                                 

law of agency as interpreted and promulgated by this court.   And in a common law  



                                                                                                                                                                                                     

agency  relationship,  unless the parties agree otherwise,  the principal has a duty  to  



                                                                                                                                                                           23  

                                                                                                                                                                                                  

indemnify the agent for expenditures that were beneficial to the principal.                                                                                                      Under this  



                                                                                                                                                                                              

rule, the relevant question is whether the attorney's fees Cottini seeks to collect were  



                                                                                   

incurred for services that benefited Berggren.  



                                                                                                                                                                                        

                               Berggren  argues  that  after  the  superior  court  terminated  the  agency  



                                                                                                                                                                                 

relationship, Cottini and Berggren were adverse parties, and that because Vallentine  



                                                                                                                                                                                                   

represented Cottini individually, the services Vallentine provided benefited Cottini, not  



                                                                                                                                                           

Berggren.  In short, Berggren contends that there is a "principled difference" between  



                22  

                               Power of Attorney                          , B    LACK 'S  LAW  DICTIONARY  (10th ed. 2014).                                          



                23  

                               RESTATEMENT  (THIRD)   OF   AGENCY    8.14 (A                                                                  M. L       AW  INST . 2006) ("A                   

                                                                                                                                                                                                 

principal has a duty to indemnify an agent (1) in accordance with the terms of any  

                                                                                                                                                                                                       

contract between them; and (2) unless otherwise agreed, (a) when the agent makes a  

payment (i) within the scope of the agent's actual authority, or (ii) that is beneficial to  

                                                                                                                                                                                                   

the principal, unless the agent acts officiously in making the payment; or (b) when the  

                                                                                                                                                                                              

agent  suffers  a  loss  that  fairly  should  be  borne  by  the  principal  in  light  of  their  

                                      

relationship.").  



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----------------------- Page 14-----------------------

 Cottini's "unquestioned right to pay Shaftel to assist in agency affairs" and Cottini's                                                                                                                                                                                                             



 "individual defense" through Vallentine against Berggren's objections. Berggren points                                                                                                                                                                                                                        



to several out-of-statecases,                                                                            largely fromtheestateadministrationcontext, that heargues                                                                                                                                            



 give dispositive weight to the distinction between an attorney representing an agent                                                                                                                                                                                                                            



 individually and one representing the agent in a fiduciary capacity, with reimbursement                                                                                                                                                                                      



 for attorney's fees being required only for the latter.                                                                                                                                                      But in each of these cases, the                                                                             



 dispositive question the court addressed was whether the services in question were                                                                                                                                                                                                                               

 actually rendered for the benefit of the estate.                                                                                                                           24  



                                                   And  either  way,  the  distinction  in  this  case  between  Vallentine's  and  

                                                                                                                                                                                                                                                                                                                       



 Shaftel's services was largely cosmetic.  Although Vallentine and Shaftel repeatedly  

                                                                                                                                                                                                                                                                                              



 identified  themselves  to  the  superior  court  as  respectively  representing  Cottini  

                                                                                                                                                                                                                                                                                                        



 individually and in his capacity as agent, the two attorneys consistently cosigned filings  

                                                                                                                                                                                                                                                                                                              



 and worked together.  At one point, Shaftel even filed a notice of non-participation in a  

                                                                                                                                                                                                                                                                                                                                  



 scheduled hearing in which he informed the court that he had conferred with Vallentine  

                                                                                                                                                                                                                                                                                               



 and that she would convey to the court Cottini's position in his capacity as Berggren's  

                                                                                                                                                                                                                                                                                            



 former  agent.                                                   Thus,  despite  their  representations,  it  is  clear  that  Vallentine's  

                                                                                                                                                                                                                                                                                    



representation covered Cottini both individually and in his capacity as agent. We are not  

                                                                                                                                                                                                                                                                                                                          



                         24  

                                                   See, e.g.                      ,  In re Estate of Raphael                                                                  , 274 P.2d 880, 883-84 (Cal. App. 1954)                                                                                           

 (denying attorney's fees for legal services where the court found "no theory upon which                                                                                                                                                                                                                       

the estate could be benefitted by the administrator's action" but allowing attorney's fees                                                                                                                                                                                                                             

 for defending against challenges                                                                                                  to the administrator's accounting);                                                                                                     In re Estate of                                   

Painter, 671 P.2d 1331, 1334 (Colo. App. 1983) ("[F]ees collectable under [the relevant                                                                                                                                                                                                                 

 statute] must necessarily be related to services rendered to benefit the estate.");                                                                                                                                                                                                                         Estate  

 of Breeden v. Gelfond,                                                                    87 P.3d 167, 170-71 (Colo. App. 2003) (applying                                                                                                                                                       Painter 's  

 "benefit rule" to                                                conclude   that  an  estate representative who was sued for                                                                                                                                                                       work   he  

performed   in   that   capacity,   and   whose   work   benefited   the   estate,   was   "entitled   to  

necessary expenses, disbursements, and reasonable attorney fees incurred in defending                                                                                                                                                                                                           

this action").   



                                                                                                                                                            -14-                                                                                                                                                    7250
  


----------------------- Page 15-----------------------

convinced   that   resolution   of   the   question   whether   Vallentine's   services   benefited  



Berggren should depend on how Vallentine nominally characterized her representation                                                                                                                                  



of Cottini.                     Rather, the correct analysis is whether the representation actually afforded                                                                                                                          



some benefit to Berggren.                      



                                       To answer that question, Cottini directs us to several cases from the trustee                                                                                                                        



context.  He argues that those cases indicate by analogy that as an agent - who like a   



trustee is a fiduciary - he should be entitled to attorney's fees from his principal when                                                                                                                                                      



those fees were incurred in defending his work as an agent.                                                                                                                     For example, in                                 Saulsbury  



v.  Denton National Bank                                                 , a Maryland case, the life tenants of a trust petitioned the court                                                                                                    



to remove the trustee and surcharge him for alleged malfeasance, but they later moved                                                                                                                                                      

                                                                                                                                                                                                25   The court awarded  

to dismiss their claims without prejudice when one of them fell ill.                                                                                                                                                                  

                                                                                                                                                                                                          26      The petitioners  

attorney's fees to the trustee, to be charged against the trust's assets.                                                                                                                                                      



argued on appeal that "where the defendant-trustee is not directly preserving the assets  

                                                                                                                                                                                                                                              



of the trust but is rather fighting a legal battle to preserve his own status as trustee, he is  

                                                                                                                                                                                                                                                          

                                                                                                                                                                                27       The Maryland Court of  

acting not on behalf of the trust but on behalf of himself."                                                                                                                                                                                            

                                                                                                                                                    



Special Appeals acknowledged "a certain surface logic in the proposition" but held that  

                                                                                                                                                                                                                                                    



"a successful defense by a trustee against an effort to remove him as trustee is a defense  

                                                                                                                                                                                                                                       

on behalf of the trust estate itself."28                                                                          The court quoted from a treatise to explain its  

                                                                                                                                                                                                                                                       



rationale:  



                                        [T]rustees have no beneficial interest in the trust property.  

                                                                                                                                                                                                                         

                                       They hold it for the accommodation and benefit of others.  If  

                                                                                                                                                                                                                  



                    25  

                                       335 A.2d 199, 199-200 (Md. Spec. App. 1975).                                                                              



                    26  

                                                        

                                       Id. at 200.  



                    27  

                                                                        

                                       Id. at 201.  



                    28  

                                       Id.  



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----------------------- Page 16-----------------------

                                     they   perform   their   duties   faithfully,   and   are   guilty  of   no  

                                     unjust, improper, or oppressive conduct, they ought not in                                                                                                     

                                    justice and good conscience to be put to any expense out of     

                                     their own moneys.                                    If, therefore, they are brought before the                                                             

                                     court without blame on their part, they should be reimbursed                                                                          

                                     all the expenses that they incur, and allowed their costs as                                                                                  

                                     between solicitor and client.                                                 [29]  



The court also noted opinions on the subject from Judge Benjamin Cardozo30  and Judge  

                                                                                                                                                                                                                              

Learned  Hand,31                                    both  supporting  the  proposition  that  a  trustee  is  entitled  to  

                                                                                                                                                                                                                                      



reimbursement from the trust for attorney's fees incurred in successfully defending  

                                                                                                                                                                                                                  



against surcharge and removal.  

                                                              



                                     Similarly, in Hollaway v. Edwards, a California case, a trust beneficiary  

                                                                                                                                                                                                               

petitioned for removal of the trustee and alleged breach of fiduciary duties.32                                                                                                                                     The court  

                                                                                                                                                                                                                                



found no wrongdoing and denied the petition, allowing the trustee to recover attorney's  

                                                                                                                                                                                                                   

fees from the trust.33   The California Court of Appeal affirmed and explicitly rejected the  

                                                                                                                                                                                                                                      



                  29  

                                    Id. (quoting 2 JAIRUS  WARE  PERRY, A T                                                                         REATISE ON THE  LAW OF                                              TRUSTS  

              TRUSTEES  894 (7th ed. 1929)).                                      

AND                                                         



                  30  

                                    Id.  at 201-02 ("The question remains whether the services were beneficial                                                                                                     

in the preservation of the trust. We have no doubt that they were. . . . [The trustee] owed  

                                                                                                                                                                                                                               

a duty to the estate to stand his ground against unjust attack.                                                                                                         He resisted an attempt to  

wrest the administration of the trust from one selected by the testator and to place it in                                                                                                                         

strange hands." (quoting                                           Jessup v. Smith                           , 119 N.E. 403, 404 (N.Y. 1918) (Cardozo, J.))).                                                                     



                  31                Id. at 202 ("To compel [the trustee] to bear the expense of an unsuccessful  

                                                                                                                                                                                                           

attack would be to diminish the compensation to which he is entitled and which was a  

                                                                                                                                         

part of the inducement to his acceptance of the burden of his duties.   This has been  

                                                                                                                                                                                                                                 

uniformly the ruling, so far as we have found." (quoting  Weidlich v. Comley, 267 F.2d  

                                                                                                                                                                                                                                  

 133, 134 (2d Cir. 1959) (Learned Hand, J.))).  

                                                                                                                



                  32                 80 Cal. Rptr. 2d 166, 168 (Cal. App. 1998).  

                                                                                                                                           



                  33                Id.  

                        



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----------------------- Page 17-----------------------

argument that the trustee should not be entitled to attorney's fees because they were                                                       



                                                           34  

incurred to serve her own interests.                                                                                                    

                                                               The appellate court reasoned that "[w]hile defense  



                                                                                                                                               

against those allegations may have benefited [the trustee] personally by eliminating the  



                                                                                                                                       

possibility of individual liability, [it] also benefited the trust by eliminating charges  



                                                                                                                                               

raising serious questions about whether she had and could continue to administer the  



                          35  

          

trust properly." 



                       Berggren raises a number of arguments against following the examples of  

                                                                                                                                                 



these  cases.           First,  Berggren  contends  that  we  considered  and  rejected  this  line  of  

                                                                                                                                                

                                                                                                                             36   But in that  

reasoning in the trustee context in Marshall v. First National Bank Alaska .  

                                                                                                                                              



case, we only refused to hold as a matter of law that the trustee was entitled to attorney's  

                                                                                                                                   



fees for defending his actions; we recognized that a trustee may be entitled to attorney's  

                                                                                                                                   

                                                 37  an approach we discuss in further detail below.  

fees on a case-by-case basis,                                                                                             

                                        



                       Second, Berggren contends that we rejected this "benefit theory" in Enders  

                                                                                                                                         

                  38   We did not. In that case we considered AS 13.16.435, which governs  

v. Parker.                                                                                                                            

     

                                                                                     39    We concluded that, based on the  

recovery of expenses incurred in estate litigation.                                                                                            

                                                                      

statute's plain language,40  it does not impose a requirement that such litigation benefit  

                                              



           34  

                       Id.  at   170.    



           35  

                       Id.  



           36  

                       97  P.3d  830  (Alaska  2004).  



           37  

                       See  id.  at  842-43.  



           38  

                       66  P.3d   11  (Alaska  2003).  



           39  

                       Id.  at   14-15.  



           40  

                       AS   13.16.435  provides  in  full: "If  any  personal  representative  or  person  

nominated as personal  representative defends or prosecutes  any proceeding in  good faith,  

                                                                                                                             (continued...)  



                                                                      -17-                                                                 7250
  


----------------------- Page 18-----------------------

the estate; rather, the statute allows the personal representative of an estate to recover                                                                                                                                                                                                                                                                    



attorney's fees for any proceeding or defense brought in good faith on behalf of the                                                                                                                                                                                                                                                                                             



estate. No equivalent statute applies to the case now before us, and common law agency                                                                                                                                                                                                                                                                           



principles do look to whether an agent's actions benefit the principal.                                                                                                                                                                                                                                               



                                                            Third, Berggren also argues that some of the cases Cottini relies on are                                                                                                                                                                                                                                             



distinguishable as based on statutes that explicitly provide for shifting of attorney's fees.                                                                                                                                                                                                                                                                                                       



But this does not undermine their relevance. The policies animating similar statutes and                                                                                                                                                                                                                                                                                        



the principles courts rely on to interpret those statutes are relevant to deciding the issue                                                                                                                                                                                                                                                                             



before us.   



                                                           Fourth, Berggren argues thatweshoulddisregard                                                                                                                                                                          casesbased                                          on successful  



defenses, asserting that Cottini did not successfully defend his actions because he settled                                                                                                                                                                                                                                                                        



the   claims   challenging   his   accounting  and   actions   as   agent.     This   argument   is  



unpersuasive   given   that   all   of   Berggren's   objections   to   Cottini's   accounting   were  



withdrawn, Berggren's counterclaims were dismissed with prejudice, and Berggren                                                                                                                                                                                                                                                                      



ultimately agreed to pay almost all of the agency fees and expenditures Cottini requested.                                                                                                                                                                                                                                                                                                          



Although it is theoretically possible that a trial might have revealed that Cottini acted                                                                                                                                                                                                                                                                               



improperly as Berggren's agent or that Cottini's accounting was inaccurate, Berggren                                                                                                                                                                                                                                                                  



chose to settle.                                                       He cannot now argue that Cottini has not successfully defended his                                                                                                                                                                                            

accounting.41  



                              40  

                                     (...continued)  

whether successful or not, that person is entitled to receive from the estate necessary                                                                                                                                                                                                                                                             

expenses and disbursements including reasonable attorney fees incurred."                                                                                                                                                                                                                   



                              41                            Cf. Saulsbury v. Denton Nat'l Bank, 335 A.2d 199, 203 (Md. Spec. App.  

                                                                                                                                                                                                                                                                                                                     

 1975) ("[Appellants'] effort to shift the burden to the defendant-trustee to establish that  

                                                                                                                                                                                                                                                                                                                                                                               

its defense would have been bona fide had the issue reached a trial upon the merits, after  

                                                                                                                                                                                                                                                                                                                                                                            

they themselves aborted the trial, is an intolerable instance of wishing 'to have their cake  

                                                                                                                                                                                                                                                                                                                                                                            

                                                                                                                                                                                                                                                                                                                                     (continued...)  



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----------------------- Page 19-----------------------

                              Fifth, Berggren asserts that                                Saulsbury  held "that if a trustee is removed he                                                  



must pay his own expenses," suggesting without further argument that because Cottini's                                                                                        



role   as  agent  was   terminated   prior   to   the   dispute   over   the   accounting,   Cottini   is  



responsible for his own attorney's fees.                                                  Saulsbury  did cite a treatise stating that "if [a                                                 



trustee]   is   removed   he   must  pay  his   own   expenses,"   but   that   passage   refers   to   an  

                                                                                                       42 not broadly to any circumstance where  

unsuccessful defense against a removal action,                                                                                                                                      



the litigant no longer serves in a fiduciary capacity, as Berggren seems to suggest.  

                                                                                                                                                                              



                              And sixth, Berggren argues that these cases are distinguishable as fiduciary  

                                                                                                                                                                              



removal cases.  But those removals were frequently initiated because of some alleged  

                                                                                                                                                                                 

malfeasance, much like the malfeasance Berggren alleged.43  In any event, they involved  

                                                                                                                                                                              



defending a fiduciary's role like the defense at issue here, and the cases are persuasive  

                                                                                                                                                                          



by analogy.  

        



                              A recent treatise indicates that the rule reflected in Saulsbury and Hollaway  

                                                                                                                                                                            



has persevered:   trustees are generally entitled to recoup attorney's fees incurred in  

                                                                                                                                                                                            

successfully defending their actions as trustees because the defense benefits the trust.44  

                                                                                                                                                                                   



               41  

                   (...continued)  

and eat it too.' ").                      



               42             See id.  at 201 (quoting GEORGE   GLEASON   BOGERT   & G                                                                        EORGE TAYLOR  

                                                                                    

                                                                                                        

BOGERT, THE LAW OF TRUSTS AND TRUSTEES  809 (2d ed. 1960)).                                                                           



               43             See Hollaway v. Edwards, 80 Cal. Rptr. 2d 166, 168 (Cal. App. 1998)  

                                                                                                                                                                                    

("[Co-trustee and beneficiary] petitioned . . .  for [respondent's] removal as cotrustee,  

                                                                                                                                                                           

alleging she breached her fiduciary duties . . . ."); Saulsbury, 335 A.2d at 199-200.  

                                                                                                                                                                     



               44             ALAN  NEWMAN ET AL                               ., T  HE  LAW OF                TRUSTS AND                   TRUSTEES   971 (online               

                    

ed. 2017) ("Reasonable attorney's fees incurred by the trustee in anticipation of, or in                                                                                                     

defending, a claim brought against it by a beneficiary for removal or surcharge alleging                                                                                        

breach   of   duty  generally   will   be   allowed   from   the   trust   if   the   trustee's   defense   is  

successful, but usually will not be allowed if the beneficiary's claimsucceeds." (footnote                                                                                   

                                                                                                                                                                   (continued...)  



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----------------------- Page 20-----------------------

                                                                                                                                                                                                             45  

Several jurisdictions also apply a similar rule in the estate administration context.                                                                                                                              By  



analogy, an agent, who is also a fiduciary, should also be entitled to attorney's fees                                                                                                                           



incurred in successfully defending his work as an agent against a challenge by his                                                                                                                                 



principal because his defense benefits the principal.                                                      



                                  We recognize that in some ways an agent's relationship to the principal                                                                                            



differs from the relationship between trustee and beneficiary.                                                                                               For example, a trustee is                                  



not appointed by the beneficiary but by the trustor.                                                                                Consequently, a trustee's defense                                   



against a beneficiary's attempts to remove him or sue him for malfeasance is easier to                                                                                                                                



characterize as benefiting the trust itself because it is done in the service of ensuring that                                                                                                                    

                                                                                 46  With a statutory agent, there is no third party or entity  

the trustor's intent is effectuated.                                                                                                                                                                          



on behalf of which the agent can be said to be resisting; there is only the principal.  

                                                                                                                                                                                                                              



Notwithstanding  this  difference,  Cottini's  analogy  to  the  trust  context  remains  

                                                                                                                                                                                                     



persuasive.                       As  in  Hollaway,  Cottini's  defense  against  Berggren's  allegations  and  

                                                                                                                                                                                                                 



objections "may have benefited [Cottini] personally by eliminating the possibility of  

                                                                                                                                                                                         



individual liability," but it also  benefited  Berggren  by "eliminating charges raising  

                                                                                                                                                                                                         



                 44  

                      (...continued)  

omitted)).  



                 45               See,  e.g.,  In  re  Estate  of  Beach,  542  P.2d  994,  1008  (Cal. 1975)  

                                                                                                                                                             

("[E]xpenditures  for  an  executor's  or  administrator's  successful  defense  against  

                                                                                                                                                                                                       

exceptions to his account are chargeable against the estate."); In re Estate of Browarsky,  

                                                                                                                                                                                               

263  A.2d  365,  366  (Pa.  1970)  ("[I]t  would  be  unjust  to  require  [estate  executors]  

                                                                                                                                                                                                

personally to bear the reasonable costs of the defense of suits brought against themsolely  

                                                                                                                                                                                                             

by reason of their positions as executors.  'It is well established that whenever there is  

        

an unsuccessful attempt by a beneficiary to surcharge a fiduciary the latter is entitled to  

                                                                                                                                                                                                                       

an allowance out of the estate to pay for counsel fees and necessary expenditures in  

                                                                                                                                                                                                                      

defending himself against the attack.' " (quoting In re Wormley's Estate, 59 A.2d 98, 100  

                                                                                                                                                                                                                   

(Pa. 1948))).  

            



                 46               See Saulsbury, 335 A.2d at 201-02.  

                                                                                                         



                                                                                                         -20-                                                                                                  7250
  


----------------------- Page 21-----------------------

                                                                                                                                                     47  

serious questions" about whether Cottini had properly fulfilled his duties as an agent.                                                                   



                                                                                                                                           

As Cottini argues, "[a]n accurate accounting of both the expenditures and the agent's  



                                                                       

time and a determination that the agent fulfilled his fiduciary duties serve the interests  



                                                                                                                           48  

                                                                                                                

of the principal, even if the defense in the end also benefits the agent." 



                       We conclude that where a former agent retains an attorney and successfully  

                                                                                                                                   



defends the agent's accounting, the agent may be entitled to reimbursement from the  

                                                                                                                                                   



principal  because  the  defense  and  the  attorney's  representation  also  benefited  the  

                                                                                                                                                  



principal.           The  fact  that  the  attorney  may  have  nominally  represented  the  agent  

                                                                                                                                              



individually, or that the agent may  have received some individual benefit from the  

                                                                                                                                                  



attorney's services, does not preclude such reimbursement. Again, a principal has a duty  

                                                                                                                                                

to indemnify his agent for payments that benefit him.49  

                                                                                      



                       Both Cottini and Berggren advance public policy arguments in support of  

                                                                                                                                                     



their respective positions. Having considered these arguments, we conclude that the rule  

                                                                                                                                                  



outlined  above  also  serves  the  interests  of  public  policy.                                           Attorney  representation  

                                                                                                                               



enhances the adversarial process and assists the court in discerning both the truth of a  

                                                                                                                                                      



matter and how the law might apply to it. Holding agents personally responsible for the  

                                                                                                                                                   



cost of successfully defending their accounting could discourage agents from obtaining  

                                                                                                                                        



the advice of counsel, or even discourage agents from maintaining a good-faith defense  

                                                                                                                                           



            47  

                       See Hollaway             , 80 Cal. Rptr. 2d at 170.             



            48         Alaska law already recognizes that conduct that benefits the individual  

                                                                                                                                       

agent can also benefit the principal.  For example, AS 13.26.327(d) provides that "[a]n  

                                                                                                                                               

agent  [who]  acts  with  care,  competence,  and  diligence  for  the  best  interest  of  the  

                                                                                                                                                  

principal is not liable [for breach of duty] solely because the agent also benefits from the  

                                                                                                                                                   

act or has an individual or conflicting interest in relation to the property or affairs of the  

                                                                                                                                                   

principal."  

                     



            49         RESTATEMENT  (THIRD) OF  AGENCY   8.14(2)(a)(ii) (AM.L                                              AW INST . 2006).              

                



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                                                                                                                 50  

 of     legitimate   actions,   expenditures,   and   fees.                                                              We   acknowledge   that   making   the  



principal pay                     the cost of an                       agent's successful defense may similarly                                                              discourage a   



principal from challenging an agent's accounting.  But between these two options, we  



believe it is more fair to place the cost on the principal as the party choosing to initiate                                                                                                 

                                                       51     Furthermore, because the rule we outline here would require  

 adversary proceedings.                                                                                                                                                                     



 a principal to pay only the cost of legal services that actually benefit the principal, we are  

                                                                                                                                                                                                      



 notpersuaded byBerggren'ssuggestion thatthislimitedindemnificationwould foreclose  

                                                                                                                                                                                        



judicial oversight over unscrupulous agents.  

                                                                                         



                                Cottini also argues that a number of equitable factors support his claim. He  

                                                                                                                                                                                                      



 asserts that he did not ask to be appointed as Berggren's agent but accepted the surprise  

                                                                                                                                                                                          



 appointment after Berggren's injury, even though it was a substantial time commitment.  

                                                                                                                                                                              



 Cottini contends that after submitting a detailed accounting he hoped to be done with the  

                                                                                                                                                                                                      



 matter, but that Berggren's unreasonable objections and counterclaims led him to retain  

                                                                                                                                                                                                



 an attorney to defend his accounting.  When Berggren withdrew the counterclaims and  

                                                                                                                                                                                                    



 objections, Cottini observes that everyone was left in the same position as if Berggren  



 had never opposed the accounting.  Cottini argues he should not now be left to foot the  

                                                                                                                                                                                                      



bill for fees he incurred only because of his appointment as Berggren's agent.  

                                                                                                                                                                          



                50  

                                Contrary to Berggren's suggestion, we did not reject this policy argument                                                                              

 in  Marshall v. First National Bank Alaska,                                                         97 P.3d 830 (Alaska 2004).                                        In that case, the              

 superior court's probate master expressed this possible chilling effect as one of several                                                                                                  

 grounds for denying a surcharge petition against a trustee.                                                                                   Id.   at 838.                 Our decision   

 vacated that denial, but we did not reject the substance of the policy arguments.                                                                                                         Rather,  

 we merely directed the superior court to a contrary applicable statutory standard and                                                                                                              

 remanded for further proceedings.                                                 Id.  at 838-39, 843.               



                51              Cf. Saulsbury, 335 A.2d at 201 ("If [trustees] are brought before the court  

                                                                                                                                                                                                 

without blame on their part, they should be reimbursed all the expenses that they incur,  

                                                                                                                                                                                               

 and allowed their costs as between solicitor and client." (quoting PERRY, supra note 31,  

                                                                                                                                                                                                      

 at  894)).  

          



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                        An   agent   has   a   statutory   duty   to   "keep   a   record   of   all   receipts,  



disbursements, and transactions made on behalf of the principal" and to produce that                                                             

                                                                                         52  From this obligation, it is a short  

 accounting on request of the principal or the court.                                         



 step to reason that, as a consequence of accepting the appointment, the agent would need  

                                                                                                                                                



to defend that accounting if challenged. Broadly speaking, we find compelling Cottini's  

                                                                                                                                         



 argument that it would be unfair to force an agent to personally fund the successful  

                                                                                                                                     



defense of actions that were taken in good faith and only because of having accepted the  

                                                                                                                                                  



 appointment as agent.  

                             



                        On the other hand, there are factors in tension with Cottini's narrative.  

                                                                                                                                                         



 Cottini was not acting merely as a friend, but sought compensation at a rate of $50 per  

                                                                                                                                                  



hour for his services as agent. Cottini also initially resisted the termination of his agency.  

                                                                                                                                                         



One of Berggren's physicians opined that Cottini was not "using appropriate substituted  

                                                                                                                                     



judgment consistent with Mr. Berggren's values or wishes," and described the situation  

                                                                                                                                         



 as  "completely  adversarial."                          In  addition,  although  Cottini  claims  that  Berggren  

                                                                                                                                      



unreasonably prolonged litigation, Berggren asserts that Cottini failed to communicate  

                                                                                                                                



with Berggren and that the dispute "could have been resolved privately between two  

                                                                                                                                                 



 'friends.' "  

                  



                        The court did not consider these factual issues because it denied Cottini's  

                                                                                                                                        



 attorney's fees under AS 13.26.291(d) as a matter of law.  These considerations may be  

                                                                                                                                                   



relevant to the court's inquiry under the approach we outline in the next section, but we  

                                                                                                                                                  



highlight here the more general point that agents who are "brought before the court  

                                                                                                                                              

without blame on their part,"53  who are forced to defend their accounting by virtue of  

                                                                                                                                                    



            52  

                        AS 13.26.610(b)(4), (h).                     



            53          Saulsbury, 335 A.2d at 201 (quoting PERRY, supra note 31, at  894).  

                                                                                                                                        



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----------------------- Page 24-----------------------

accepting   the   appointment   as   agent,   and   who   succeed   in   that   defense,   should   not  



therefore be obligated to fund their litigation costs out of pocket.                                                                              



                 D.	              On Remand, The Superior Court Must Determine Whether Cottini Is                                                                                                                      

                                  Entitled   To   Attorney's   Fees   Through   An   Approach   Modeled   On  

                                  Marshall v. First National Bank Alaska                                                                  .  



                                  Both parties spend a considerable portion of their briefing discussing how                                                                                                     



our   decision   in   Marshall   v.   First   National   Bank   Alaska   supports   their   respective  



positions. That case addressed attorney's fees related to the substitution of a trustee, not                                                                                                                        



a challenge to an agent's performance and accounting.                                                                                          Its holding therefore does not                                      



directly govern this case, but it nonetheless provides valuable guidance for resolving the                                                                                                                          



issue at hand.                      In  Marshall, the beneficiary of a trust successfully petitioned to have the                                                                                                    

                                                54      The trustee incurred attorney's fees in litigating the dispute and  

trustee substituted.                                                                                                                                                                                              



charged themto the trust; the beneficiary, in a surcharge petition, asked the court to order  

                                                                                                                                                                                                               

the trustee to repay the trust.55   The superior court denied the request, reasoning that the  

                                                                                                                                                                                                                    



trustee had not acted in bad faith, that no statute authorized such a request, and that  

                                                                                                                                                                                                                 



forcing the trustee to repay the trust would have a chilling effect on future trustees who  

                                                                                                                                                                                                                 

might disagree with a trust beneficiary.56  

                                                                      



                                  We explained that because there was a statute that authorized a surcharge  

                                                                                                                                                                                                  



petition if the trustee's fees were excessive or unreasonable it was legal error to deny the  

                                                                                                                                                                                                                    

petition for  the reasons discussed  by  the superior  court.57                                                                                              We then  explained that  

                                                                                                                                                                                                                 



compensation  could  be  unreasonable  either  because  the  fees  themselves  were  

                                                                                                                                                                                                             



                 54  

                                  Marshall, 97 P.3d at 833-34.                          



                 55  

                                                               

                                  Id. at 834.  



                 56  

                                  Id.  



                 57  

                                                                                 

                                  Id. at 838; see AS 13.36.055.  



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----------------------- Page 25-----------------------

unreasonable    or    because    the    services    for    which    the    fees    were    charged   were  



                       58  

unreasonable.                                                                                                                 

                            To inform this analysis, we looked to the trust document, applicable  



                                             

statutes, and common law principles.  



                                                                                                                                       

                      Thetrust document authorized thetrusteetoemployattorneysandpay them  

                                                                                                         59  But, noting that "[a]  

                                                                                                                                        

reasonable compensation, as well as to join in or defend litigation. 

trustee is a fiduciary of the highest order,"60  we expressed doubt as to whether the  

                                                                                                                                         



trustee's  prolonged  opposition  to  the  beneficiary's  request  to  change  trustees  was  

                                                                                                                                       

consistent with the statutes or the trust document.61  We ultimately refused to rule as a  

                                                                                                                                 

matter of law whether the trustee had to repay the disputed fees.62   Instead, we remanded  

                                                                                                                               



to the superior court to determine whether the trustee was entitled to attorney's fees in  

                                                                                                                  



light of several factors, including:  

                                        



                      the total amount of the fees, the size of the trust relative to the  

                                                                                                                    

                      amount of the fees, the merits of the parties' arguments on the  

                                                                                                                    

                      substitution dispute, the extent to which the opposition [was]  

                                                                                                                

                      based on the beneficiary's best interests in accordance with  

                                                                                                                 

                      the trust document and the Alaska Statutes, and the duration,  

                                                                                                          

                      extent, and expense of the trustee's opposition.[63]  

                                                                                 



                      Cottini   argues   we   should   consider  Marshall   persuasive   authority  

                                                                                                                              



establishing the right of an agent to recover attorney's fees incurred in successfully  

                                                                                                                          



defending the agent's own role.   Berggren urges us to reject Cottini's claim for fees  

                                                                                                                                        



           58  

                      Marshall, 97 P.3d at 839.
         



           59  

                      Id.  at 840.
      



           60
        Id. at 839.  

                                



           61         Id. at 841-42.  

                                



           62  

                      Id.  at 842-43.          



           63         Id. at 842-43.  

                                



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----------------------- Page 26-----------------------

because,   he   asserts,   we   rejected   a   similar   claim by                                                                                                                                                                                                   the   fiduciary   in   Marshall .   He  



emphasizes that in                                                                           Marshall   we concluded that a trustee's good faith opposition to                                                                                                                                                                                                                                                        



 substitution does not foreclose forcing the fiduciary to pay attorney's fees spent in                                                                                                                                                                                                                                                                                                                                



defending against substitution.                                                                                                                            Both parties ask too much of                                                                                                                            Marshall.    While our   



opinion in                                        Marshall  is persuasive, it does not establish as a matter of law a trustee's right                                                                                                                                                                                                                                                                     



to recover attorney's fees incurred in defending an attempt to replace him, only that he                                                                                                                                                                                                                                                                                                                             



may recover such fees if they are determined to be reasonable.                                                                                                                                                                                                                                                    And while we did not                                                                           



grant   the   trustee's   claim regarding                                                                                                                                       fees   in   Marshall,   we   also   did   not   reject   it,   but  



remanded for further consideration in light of the factors we identified as potentially                                                                                                                                                                                                                                                                                     



relevant.    



                                                                 We believe a similar approach in this analogous context is appropriate,                                                                                                                                                                                                                              



given   the   similarity   of   the   relevant   common   law   principles   and  fiduciary   duties.   



Consequently, we remand for the superior court to determine whether Cottini is entitled                                                                                                                                                                                                                                                                                                      



to   attorney's fees incurred                                                                                                         in   successfully  defending   his accounting                                                                                                                                                                     of his actions,                   



expenditures, and fees in light of the factors we discuss here.                                                                                                                                                                                                                                    The superior court should                                                                     



consider the statutory form power of attorney, other relevant documents, the common                                                                                                                                                                                                                                                                                                   



law of agency, and factors such as the total amount of the attorney's fees, the amount of                                                                                                                                                                                                                                                                                                                              



the assets managed relative to the amount of the attorney's fees, the merits of the parties'                                                                                                                                                                                                                                                                                                 



arguments in the underlying dispute, the extent to which the defense was based on the                                                                                                                                                                                                                                                                                                                             



best interests of the principal in accordance with the power of attorney document and                                                                                                                                                                                                                                                                                                                          



relevant Alaska Statutes, as well as the duration, extent, and expense of the agent's                                                                                                                                                                                                                                                                                                        

defense.64  



                                64  

                                                                See id.   



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----------------------- Page 27-----------------------

                       On the facts in             Marshall, we refused to rule as a matter of law that the                                       



                                                                       65  

trustee   was   entitled   to   attorney's   fees.                                                                                      

                                                                             We  observed  that  some  of  the  trustee's  



                                                                                                                                                  

opposition to the substitution was likely illegitimate, failed to give proper weight to the  

                                                                                                        66    In addition, the trustee  

                                                                                                                                           

                                                                                           

beneficiary's wishes, and was based on irrelevant factors. 

fought substitutionin prolongedlitigation that wasultimatelyunsuccessful.67  In contrast,  

                                                                                                                                         



Cottini litigated to ensure that he was paid for his time and costs already expended on  

                                                                                                                                                   



behalf of his principal in response to Berggren's objections.  Virtually all objections to  

                                                                                                                                                    



his  accounting  were  withdrawn.                               Berggren's  counterclaims  were  dismissed  with  

                                                                                                                                              



prejudice, and Berggren ultimately agreed to pay most of the fees and expenditures  

                                                                                                                                



Cottini requested.  The attorney's fees were relatively small in comparison to the assets  

                                                                                                                                             



Cottini was managing.  And basic agency law requires that "when the agent makes a  

                                                                                                                                                     



payment . . . that is beneficial to the principal . . . or . . . suffers a loss that fairly should  

                                                                                                                                            

be borne by the principal in light of their relationship" the agent must be indemnified.68  

                                                                                                                               



                       Because  the  superior  court  is  more  familiar  with  the  dispute  at  hand,  

                                                                                                                                             



including equitable factors such as thosediscussed above, and because it did not consider  

                                                                                                                                         



these factors in its decision denying Cottini's fee request, we remand so the court can  

                                                                                                                                                 



consider and apply the factors we have identified, as well as other factors the parties or  

                                                                                                                                                    



the court may identify on remand. We emphasize that although the requested attorney's  

                                                                                                                                      



fees were more than double the agent's fees Cottini charged, the ratio between the  

                                                                                                                                                 



            65  

                       See id.      at 842.   



            66  

                       Id.   ("The probate master's report recommending substitution implicitly                                        

                                                                                              

recognizes the frailty of [the trustee's] opposition.").  



            67         Id.  at  841  ("We  leave  it  to  the  court  on  remand  to  consider whether  

                                                                                                                                         

prolonged opposition to a request to change trustees was consistent with the statutes or  

                                                                                                                                                    

the trust document.").  

                



            68         RESTATEMENT  (THIRD) OF  AGENCY    8.14(2) (A                                      M. L    AW  INST . 2006).   

                



                                                                        -27-                                                                  7250
  


----------------------- Page 28-----------------------

amount of Cottini's agent's fees and the amount of the attorney's fees incurred to defend                                                                                                                              



them is not among the factors to be considered in determining whether Cottini is entitled                                                                                                                            



to   reasonable   attorney's   fees,   considering   that   Cottini   was   also   defending   against  



allegations of breach of fiduciary duty and mismanagement of a multi-million dollar                                                                                                                                      

estate.69  



                                    Finally,  we  hold  that  where  an  agent  successfully  defends  against  a  

                                                                                                                                                                                                                                     



challenge from his principal and is entitled to reimbursement for the attorney's fees  

                                                                                                                                                                                                                              



incurred, the agent is not also entitled to an award of attorney's fees under Alaska Civil  

                                                                                                                                                                                                                            



Rule 82.  This is because the framework we have outlined here constitutes a fee-shifting  

                                                                                                                                                                                                        



framework that is "otherwise provided by law," thus displacing Rule 82 in this context.  

                                                                                                                                                                                                                                            



We are not presented with the question whether a principal who successfully challenges  

                                                                                                                                                                                                             



the agent's accounting might be eligible for a Rule 82 award, and so we do not address  

                                                                                                                                                                                                                     



it.  



V.                CONCLUSION  



                                    WeREVERSE thecourt's decision denying Cottini'smotion for attorney's  

                                                                                                                                                                                                               



fees and REMAND for further proceedings consistent with this opinion.  

                                                                                                                                                                             



                  69  

                                    See In re Estate of Johnson                                             , 119 P.3d 425, 434 (Alaska 2005) ("[A]nother                                                 

factor that a trial court may consider when determining the reasonableness of fees in the                                                                                                                                        

estate context is the size of the estate.").                                        



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