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AMERICAN ARBITRATION ASSOCIATION In the Matter of the Arbitration between Patricia Weatherby, Claimant, v Case No. 01-17-0001-8761 ‘The Terminix International Company, Inc., et al, Respondents AWARD OF ARBITRATOR 1, Hon. Eugenia M. Benedict, THE UNDERSIGNED ARBITRATOR, having been designated in necordance with the arbitration apreement entered into between the above-named parties, with Claimant represented by Thomas Campbell, of Campbell Litigation of Birmingham, AL. and with Respondents represented by Michael Bell, Haley Cox and Charles Green, of Lightfoot, Franklin and White also of Birmingham, AL, and having been duly sworn, and having duly heard the proofs and allegations of the Parties at an in-person hearing in Mobile, AL on January 8-11, 2019, do hereby FIND as follows FINDINGS OF FACT In 1986, Claimant, Pteicia Weatherby and her husband, SkipWeatherby, were building a home and contracted with Respondent, Terminix International, through it franchisee, Allied-Bruce, to perforra 8 Conventional trestment against subterranean termites; their contract did not cover protection against Formosan termites. A Conventional treatment plan has two distinct phases. The first involves teating the bare soil prior to slab being poured and a full Post Construction ‘eeatment ater the building has been completed, In other words, to comply with the instructions on the termitiide label, which is required by law, two very different procedures were required with differing amounts of chemical to be used during each one. Although the Pre-construction soil treatment is important and required under such a contract, the majority of the protection the \Weatherbys were paying for was to be provided by the extensive Post Construction application. This phase requires at least the following treatment procedures: trenching around the structure no closer than six inches (6") from the edge ofthe building and drenching the ground inthe trench with the proper amount of chemicals; rlling the conerete blocks of foundation deeply enough to get the proper amount ofthe chemical down to each footer, Grilling through the concrete blocks to get the proper amount of the chemical tothe dirt "under the slab on which the building hasbeen built; {rlling holes in the concrete siab no closer than six inches (6") ftom the edge of the building and no farther than twelve inches (12” apart) and applying the proper amount of the ‘chemical through those holes; ‘treating all areas where utility pipes have penetrated the termite barie, and where abutting areas of concrete have been poured at different times, the joint between them, called a “cold join”, must be drilled because a separation forms asthe concrete portions ry at different times. These holes also are to be no farther than twelve inches (12")apat. The proper amount of the chemical must then be applied through these holes for adequate protection against termites. ‘The temmiticide tobe used was Premise 75, the prefered product in the industry at that time. ‘Terminix made one visit to the Weatherby home during the construction period and, presumably, applied chemicals to the soil where the slab would be poured. However, it appears that Terminix «did not make the all-important Post Construction treatment when the house was Finished or at ‘any time, Terminix indicated t the Weatherbys tat it had performed the required services and any others as needed and did annual inspections. With those assurances, Terminix collected annual contract renewal charges from the Weatherby for the next twelve (12) years ‘Terminix performed three spot treatments at the Weatherby home between 1986 and 1998. ‘Terminix inspection graft of November, 1998, noted which treatment procedures were requited for a Post Construction treatment but there was no actual evidence that they had been performed or thatthe Weatherbys were informed. In 1998, the Weatherbys purchased an additional or revised contract with Terminix that did include coverage against Formosan termites. The contract promised annual inspections and repair of damaged areas without charge where ive termites were found, However, Terminix did not provide ther employees with tools for testing the extent of any damage which they might find during inspections. Testimony of past and present Terminix testers revealed that they were pressured by the company to do at leat fourteen (14) inspections dsily and that they could not do ‘them well, fatal, in the time permitted, The company computer records showed that the inspections had been done although there were no actual work records to prove that they had ‘occurred. Terminix either did not perform the required annual inspections at all or, i they dd, they were not done thoroughly. Under Alabama law, filure to do an annual inspection under a Pest Control contract such as this one i a crime. The Weatherbys found termite damage and active termites inthe back wall oftheir home in 1998 and in 1999 and informed Terminix immediately both times. Terminix sent an inspector Who did ‘or arranged for another employee to do spot treatments on the affected areas. Terminix did not {inform the Weatherbys that the initial treatment in 1986 might not have been done correctly or ‘might have been skipped altogether or that the chemicals, even if applied properly, might have 2 wom off |n.2001, after Terminix International, Inc, had purchased Allied-Bruce, is aforementioned fianchisee, it began using Termidor, the new state of the ar termitiide in the industry, (Chemicals used in the Pest Control industry are dangerous so they are heavily regulated, Stict requirements govern who may use them and wat procedures and strengths must be followed. In ‘Alabama, the agency charged with responsibility for regulating the industry isthe Alabama Department of Agriculture and Industry, (hereinafter ealled the ADA. As pointed out above, the requirements listed on the label of Termidor require specific procedures which must be followed and likewise specific concentrations of the chemical o be applied at equally specific ‘depths. Alabama is a Minimum Requirements state but the said minimum requirements are clearly set out onthe produc label and no variation is acceptable, A Pest Control company that, fails to perform as required can face a host of sanctions by the ADA including losing its license andlor facing criminal charges. ‘The Weatherbys found active termites and damage in their home again in 2002 and 2003. On both occasions winen notified ofthe recent damage, Terminix did only spot treatments of the infested areas. Terminix did not disclose whether a thorough initial treatment hed been done in 1998 nor did they perform one even when it was obvious that their previous spot treatments had proven ineffective. Terminix processed a small claim for them in 2002, paying them $850,00 but never disclosing the failure to treat properly. During the early 2000's, Terminix established a company-wide Fthies Points poliey which sequired that any contact from a State or Federal agency to a branch be reported by the branch ‘manager to all officers above the branch level. Thereafter, any claim made by a eustomer to the ADA or any quety or investigation from another agency would be known all the wey up the fine including tothe CEO and COO of Terminix International. There is no basis to any assertion that the top officials did not know of the vast volume of claims made or the extent of damages involved. Branch managers could resolve smal claims of no more than about Five thousand «dollars ($5,000.00) but decisions for claims in excess ofthat amount were made by those higher up and only officers atthe top of the company decided claims for $50,000.00 and above such as this one. “Terminix created “filter branch” offices wo deal with customers who had demands for remediation of damage which hed occured to their homes while under contrat withthe company. There was testimony that several Terminix employees, including former branch ‘manager Steve Bamett, had suggested to company oficial tht they should perform al tteatments property and retreat thoroughly where previous ones had been inadequate. The purpose, obviously, would be to prevent foreseeable damage caused bythe sipshod manner that ‘was routine and to eliminate new complaints. Terminix refused todo $0. ‘Terminix, in an apparent effort to shield itself financially from the consequences of is own practice of inadequate treatments, limited the remedial ations its employees could take. Jeff 3 Storck, the Vice President forthe Southeastern Division of Terminix Intemational, sent out strict instractions to limit such remediation. An annual technical alert bulletin to general branch ‘managers stated thatthe company’s national policy was that pursuant to annual inspections of ‘customers’ homes no additional treatments should be done to damaged properties unless one of| thre factors was present: presence of live termites, there had been an alteration to the foundation or there was evidence thatthe client had dug up the termite barrie. In ather words, unless one's home curently had living, visible termites or the owner had altered the supposedly treated sol, ‘no amount of obvious damage would be repaired. Initially, the Weathersby’s” home had a concrete block foundation with dr filled in behind them and a stucco veneer. The Weatherbys chose to add brick veneer to the stueco in 2008. Under ‘their contract with Terminix, the Weatherbys were required 10 inform Terminix oftheir installing the brick as such could disturb the termite barrier which should exist if treatments ad been done properly, The Weatherbys did not notify Terminix. The company then had three options for how to deal with the ground having been disturbed, They could cancel the Weatherby" contract; they ‘ould require an additonal charge for having to-do an additional treatment OR they could waive either ofthe above, Terminix chose the las. {In August of 2010, the Weatherbys reported to Terminix that they were having a large swarm of termites at their home. When an inspector from the company came, he told Mrs. Weatherby not to worry because although it was late for swarm activity which usually occurred in late spring it ‘was not @ concer, No treatment was done although the swarm was both outside and inside the home. Mrs. Weatherby testified tht she bought an over the counter bug spray and sprayed the ‘ermites herself. Terminix did not investigate the source ofthe termite swarm or if any damage had been dane by it ‘Terminix alleges that no termite damage was found at the Weatherby home between 2003 and 2016, However, there either are no records oftheir annual inspections or, if they exist, they note very shor time periods for each inspection. With such sparse or non-existent anual inspections, itis reasonable to believe that live termite activity might not have been seen even ift had been resent ‘When the Weatherbys found extensive damage tothe back wal oftheir home in 2016, they notified Terminix but no one came from the company to survey the damage. The Weatherbys, after approximately five (5) months of waiting for Terminix to respond, hited a company, at theit ‘own expense, which removed the entire rear wall tothe studs. Ths revealed that the wood fram the ground tothe soits was riddled with termite damage. This was the same ares where “Terminix had repeatedly done only spot weatments, In addition to damage which the Weatherbys repaired in their back wall, they found damage in ‘anadjacent garage as well. Terminix’s own witness, forensic structural engineer Phil Wilbourn, ‘easily found evidence of additional damage to another wall ad parts ofthe front of the house, In ‘essence, he testified that every wall of the home showed evidence of pastor present damage. Mr. Wilbourn also found damage in a bathroom where itappeared no protection had been made to a uty penetration as required by the termiticide label, These areas have yet to be examined fully 4 and the cost to repair them eannot be known a this point ‘The Weatherbys hired Alapest to treat their home for termite prevention and discovered that there were no visible dill holes as should have been done initially by Allied-Bruce in 1986 and then by Terminix at less sixteen years before. Although the brick veneer the Weatherbys installed in 2008 would have covered any holes which Terminix might have drilled earlier in the concrete blocks, they should have drilled the brick veneer, the cold joit in the garage and the brick patio surface all clearly visible to any Terminix inspector and should have been drilled Although some drill holes were discovered in the concrete front porch, the holes were farther ‘apart than the required twelve inches (12°) and appeared almost randomly spaced in vielation of the requirements on the Terminix label. ‘The Weatherbys filed @ complaint with the ADAL, hired counsel and filed a demand for arbitration against Terminix, Their Complaint alleged that Terminix had committed Fraud, negligence, professional negligence (including training and supervision), breach of contrat, and demanded equitable relief relating to the failure to disclose problems with, making proper recommendations for and providing proper termite prevention, Damages are compensatory, punitive, special and equitable. The initial amount of the Claim was $235,475.00. DISCUSSION L ‘The Weatherbys initially contracted with Terminix through its franchisee, Allied-Bruce, in 1986 todo a Pre-Construction treatment while thet home was being Bul, The contac also requied “Terminix to peform a Post Construction weatment involving specific procedures as requted by the temiticid label after the home was built but that treatment was never done. The Weatherbys allowed tha contacto lapse but entered into a new one with Terminix in 1998, They found termite damage almost immediatly. Additonal damage was found soon thereafter bit Termisix fae wo perform a thorough treatment even then or to inform the Weathers that one had never been done, Considering thatthe Weatherby had a contrat with Terminix fom 1986 through the lapsed petiod and then uncer the renewed contact of 1998 through 2016 when they terminated ‘their legal relationship with Terminix, the Weatherbys relied on Terminix for protection from termites for almost hiy (30) veas. Although Termiix never performed the promised services or informed their customer that they had filed to do 30, Terminix diligently collected the anal renewal fes n During inspections following the Weatherbys’ discovery of termite damage in 2016, expert witnesses and/or the ADA inspector found that: 1. Terminix's record ofthe Preconstruction treatment showed that only approximately ‘one third of the required amount of chemical had been used in violation of the ADA regulations; during the Weathersby’s’ nearly thirty (30) year period of contracting with Terminix, ‘no Post Construction treatment was ever performed ‘there were no visible drill holes along the brick patio area, the cold slab inthe garage 5 orn the brick veneer which had been in place since 20083, 4. betwen 2008 and 2016, there had been ample opportunities for Terminix personnel doing annual inspections to notice the installation of the brick veneer and to treat it accordingly but that was not done; . where there were drill holes inthe front porch, many were farther apart than the 12", required by the ADA regulations; £, there were no visible drill holes inthe sidewalk adjacent te the wooden steps in the front ofthe house: the same section ofthe damaged back wall was treated several times by only spot treatments yet continued to show termite damage; 1, several of Terminix’s own employees, whether former or current, testified to being pressured by the company to perform more inspections per day than possible, Testimony established that « thorough inspection would take between forty-five (45) minutes to an hour yet they were required to do approximately fourteen (14) pet eight (8) hour day. Joe Debrow of the ADAL confirmed that such a limited time would be insufficient to determine if termite damage ‘were present in a home, CONCLUSIONS OF LAW L Federal laws require pest control companies to follow the label instructions of the poisonous chemicals they use. 7 U.S.C.A. Section 136 et 3 ‘The Alabama Legislature established the ADAL in the 1930s to make and adopt Regulations “to ear out the intent and purpose o his chapter and to regulate persons engaged in professional services (of providing pest contol or work defined in this chapter to prevent Fraudulent and unauthorized practices of those professional services or work.” Section 228-3, Code of la. (1975) These Regulations mandste the types of treatments companies ean sll and ‘what specific treatment mechanics must be performed. ALA. ADMIN. CODE 80-10-90) et eq (2009), Also the department has brcad authority to sanction, fine and even suspen the licenses ‘of an operator who fails to comply withthe Regulations. Code of Ala. Section 2-283, (1975) requis termite companies and iensed employees under whom they operate o posta bond 0 assure «high quality of workmanship, Since the service provided to the Weatherbys is regulated by the state, contracts Terminix issued {or termite protection incorporate the minimum standards provided by the laws as matter of contract construction, Watson v, Water Works Bd, ofthe City of Birmingham, 480 So.2d 1190, 1193 (Ala. 1985). ‘The Pest Control industry is stretly regulated for atleast two reasons. One is because the chemicals used are so dangerous and the other is thatthe general public knows virtually nothing about the chemicals used or what the results might be if mishandled. The public must be able to 6 rely, through trust onthe superior knowledge of the professionals trained for work in the industry. The label for the termiticide provides exact instructions on how the chemical i to be used and no variation can be allowed; there is NO diseretion forthe professional using it, The irections are not advisory and violation of them is a Misdemeanor in Alabama. Also, Terminix has @ common law duty to disclose to its customers all material facts known toi bbut not tothe customer wich might be detrimental tothe later. Terminix di not disclose their failure to treat and the Weatherbys were deceived about the validity of the service that had been sold to them, relied on Terminix’s assertion that they were protected and were harmed. an Fraud is defined in the Code of Alabama, Section 6-5-101 et seq (1975) as follows: “. anistepresentation of material fact made willfully to deceive, or recklessly without ‘knowledge, and acted on by the opposite party, or if made by mistake and innocently and acted ‘on by the opposite perty, constitutes legal fraud”. The evidence and testimony developed at tral clearly showed that Terminix knew it had not provided the services in is contract with the ‘Weatherbys and exch renewal period thereafter when he promised were renewed, Code of Alabama, Section 6-5-102 (1975) states that “...suppression of a material fact which the party is under an obligation to communieate constitutes fraud”. Terminix had an obligation to keep the Weatherbys informed ofall material facts about their termite prevention services at heir home but chose not todo 20. The obligation arses under the terms oftheir contrat, sate lst and at common law. Lucas v, Hodges, 589 So.2d 154, 158 (Ala, 1991) From both Terminix's records and testimony at trial, it is obvious that Terminix filed to perform ‘consistently with the parties’ contract, did not inform the Weatherbys of their fallure and did not adequately and honestly correct the damage caused by their failure. Their conduct was fraudulent and they are, therfore, responsible for damages tothe Weatherbys, m. ‘Steve Barnett, former Terminix branch manager and currently an investigator forthe Claimant's attorney, Joe Debrow of the ADAI and Paul Bello, a pest control expert witness for (Claimant, all testified tha the time allowed per annual inspection was too short tobe thorough, Vv. ‘The Weaterbys allege that Terminix never intended to peeform according to ther contract and point its pater ad practice with other custome as affirmation of ther claim. Terminix ‘outinely made alarmingly short annual inspections as Steve Barnet testified, because the company policy was to make fouten (14) to sixteen 16) daily per inspector. i they made them atall Since no actual castomer tickets were produced by Terminix o show individual ome 7 inspections but such completed inspections were logged into Terminix's computer records, it appears such entries were fraudulent vy. The Termidor Ibe! allows for spot treatments to be made under certain circumstances IF thorough Post Construction treatment had been done initially. However, inthis ease, Terminix, performed only spot treatments atthe Weatherbys” home yet not only had not done the Post Construction treatment at first but, in fact, NEVER did it Such isa direct violation af the label requirements andthe State ADAI Regulations. The fact that the same insufficient “spot treatment” method was used over and over yet damage was recurring leads to the conclusion that ‘Terminix was cheating its customers. It is obvious that Terminix was the party with superior nowiedge here, knew damage was occurring and reoecurring, that the Weatherby home was being destroyed but did not take corrective action proves more than Negligence; its callousness toamalicious degree. ‘Terminix is one ofthe largest pest control companies in the world. ILknows what its responsibilities are to its industry, the states and courttes in which it does business and, most importantly, to its customers yet it shrugs those responsibilities with apparent bravado, In this case, Terminix has ignored the Regulations governing its business, the laws of Alabama, and the terms and spirit ofits contact with the Weatherbys. Therefore, Termini is solely responsible for te full damage, known and as yet unknown but foreseeeble, to the Weatherby ome, DAMAGES Property Damage ‘The Weatherbys paid approximately $200,000.00 intially for theie home but made significant {improvements over their ownership of thirty-two (32) years. Mrs. Weatherby testified that she doubted she could sll her home for more than about $25,000.00 to $50,000.00. The devaluation estimate eannot be more certain since any aditional damage, suspected but undetermined, cannot be known until the walls ofthe dubious areas are removed. The termite damage reduced the value by approximately $175,000.00 which ineludes areas clearly showing termite activity ‘The measure of damages to propery in Alabama isthe diminished value. Poffen Energy Co, 972 $0.24 792, 797 (Ala. 2007). See also Fuller v, Fai, 202 Ala 430, 80 $0, 814 (919). nL Incidental/Consequential Damage ‘When Mrs. Weatherby had repairs done fo her home in 2016, she, her ailing husband who has since died and, occasionally, her elderly mother all ved inthe home even afer a wall was 8 removed and debris was present throughout much ofthe home. According tothe testimony of ‘Terminix’s own witness, Phil Wilbourn, just as mech repair may still be needed on walls ot yet removed. Whether Mrs. Weatherby chooses to undergo the lack of privacy and perhaps safety a second time when walls are removed is her choice but she should not have todo so. Any expenses for her to have alternative living have not been determined but should be an option for her. Under Bates v. General Steel Tank Co., 36 Ala.App. 261, 264, 55 So.2d 213,215 (Ala.App. 1951), its obvious that Terminix is liable forall injuries and damage foreseeable as a result of its negligent acts. However, inthis cas, the evidence is overwhelming that Terminix was guilty ‘of years of intentional fraud and, therefore, “..there is ‘extended liability’ for intentional ts” Phillips v, Smalley Maintenance Service, ine, 435 So.24 703, 712 (Ala, 1983) m1. Attorney's Fees Although the United States borrowed our body of law, called the common la, from England ‘when tis country was established, we didnot adopt the English method of handling attorney's fees, Reynolds v, First National Bank of Montgomery, 471 80.24 1238, 1241 (Ala, 1983). We did, however, borow the principles and spirit ofthe common law’s having Law Courts and Equity Cours, The law courts dealt with violations of actual laws whi the Equity cours presided over issues of estates, wils and matrs involving". fatnes,justness and right ‘eating. .Itis grounded inthe presepts of the conscience, no in any sanction of positive law”. Black's Law Dictionary, 634, 4 Ed. Rev., 1968. “As early as 1278, the English courts allowed counsel fees to the successful plait in litigation.” I at 1241. The “American Reis that cach party bears his own costs of representation but “..dhe rule is usually expressed with exceptions eneouched therein, One of the main exlusins isthe equitable exception. I. at 1242. In Hally, Cole, 412 US. 1,93 S.Ct 1943, 36 LEM. 24 702 (1973, the Cour explained in no uncertain frm thatthe rule aay be overs ihe equities justi tis unquestioned that «federal court may award counsel fes to a successful party when his ‘opponent has acted “in bad faith, vexatiously, wantonly or for oppressive reasons. 6J. Moore, Federal Practice, paragraph 54.77(2], p. 1709 (2d ed. 1972). In this class of cases, the underiying reason of fee shifting” is, ofcourse, punitive and the essential element in triggering an award of attomey’'s fees isthe existence of “bad faith” on the part of the unsuccessful party. Reynolds, ‘supra, at 1242, See also Mills v. Electric Auto-Lite Co, 396 US. 375, 391-392 [90 S.Ct. 616, (625-626, 24 L. Ed.26 593} (1970). “The power to award such fees (attorney's fees) is part ofthe original authority ofthe chancellor todo equity ina particular situation’." Sprague v, Ticonic National Bank. 307 U.S. 161, 166 [595. C1. 777, 780, 83 L.Ed, 1184] (1939). A similar holding in Coupounas v. Morad, 380 So.2d 800, 803 (Ala. 1980) i that Alabama, a court of equity i authorized to mold its decree so as to adjust the equities ofthe parties and meet the necessities of each situatio “The obvious conclusion is that Alabama recognizes exceptions to the American Rule where fraud, willful negligence or malice has been practiced”. Reynolds, supra at 1243. 9 Inthis case where Terminix has been accused of committing multiple acts of Fraud aver a term ‘of almost thirty (30) years and the evidence abundantly supports the allegations, an award of attorney's fees is appropriate. Factors tobe considered as guides in determining the reasonableness ofa fee include the following: (1) the nature and value of the subject matter ofthe employment; (2) the learning, skill and labor requisite to handling the mater; (3) the time consumed; (4) the professional experience, reputation of the lawyer or lawyers performing the services; (5) the weight of the attorneys’ responsibilities; (6) the amount involved and the results obtained; (7) the reasonable ‘expenses incurred; (8) the likelihood tha the acceptance of the particular employment will preclude other employment by the lawyer; (9) the fee customarily charged in the locality for similar legal services; (10) the time limitations imposed by the client or by the circumstances; (11) the nature and length of the professional relationship with the client; (12) whether the fe is fixed or contingent. Peebles v, Miley, 439 So. 2d 137 (Ala, 1983). See also Model Code of Professional Responsibiliy, DR 2-106(B) (1982). CConsiering factors One through Three: Becoming adequately prepared to ligatew case involving the Pest Control Industry is, by is very technicel nature, quite complicated and beyond the eal of mos civil practice attomeys. Many lay persons have had some limited experience ‘with epiting the mechanieal parts ofa vehicle or constructing a building but very few havea background that includes dealing withthe pesticides used or knowledge ofthe characteristics of termite behavior shat must be understood 0 try a ease successfully inthe fled of killing particular insect. Only intense study can produce that information and Me. Thomas Campbell, thas clearly take that time, He is due tobe compensated for his investment. ‘Considering factors Four through Six: Mr. Campbell's law practice is primarily, if nat exclusively, involved with Plaintiffs elsims against the Pest Control profession. As such, he has reputation nation-wide as being an extremely well-informed, successful litigator. As many of his eases ae tried in Arbitration, the amounts he has won for his clients are not public information. However, he has been specializing inthis area of law for approximately thirty (30) years and cannot have continued without recovering significant judgments for his clients Considering factors Seven through Nine: Determining whether an attomeys' expenses are reasonable is complicated, In Mr. Campbell's case, he has, by his own declaration, bull avast ‘amount of information from and/or about the pest control defendants against whom he has tried ceases over the span of his career. Obviously, he doesnot need to stan from seratch with discovery when he takes on a new case. He also does not need to search for expert witnesses anew with each ease ashe often uses the same persons for heir expert opinions, He employs six litigators and several support staff persons but not all are working on any one ease. Therefor, it is crucial to determine from the Expenses spreadsheet he submitted iall expenses are exclusively from this ease. It appears that they are 10 Mr, Campbell's fee arrangement with the Claimant Patricia Weatherby, is 245% contingent fee If he fails to be successful for her, he has lost as well and cannot recover even for his expenses let alone for his time. He has been working with Mrs. Weatherby since 2016, even before she filed this case in 2017, and the trial was not held until January, 2019, During that time, he has hed no compensation for his work or expenses. However, even with all the precarious factors, being considered, any fee must be reasonable in relation tothe amount awarded, lt makes sense for an sttomey who takes a case on a contingent fee basis to charge more than an attorney wio is guaranteed compensation by periodic billings. However, The American Bar “Association in its Mode! Cade of Professional Responsibilf, DR 2-106(B) (1982), stated "a fee is clearly excessive when after review of the fats, a lawyer of ordinary pragence would be left ‘with 2 definite and firm conviction that the fe is in excess ofa reasonable fee." As the amount of the recovery increases, the attorney's fee should be prudently reduced. wv. Punitive Damages In Alabama, punitive damages are warranted when a defendant “consciously or deliberately ‘engaged in oppression, fraud, wantonness or malice with regard tothe plintf?”. Ale, Code Section 6-11-20(a) (1975). Terminix's filing to perform the required actions ofthe intial treatment of the Weatherbys" home, its company mandated “instant” annual inspection, its failure to retreat properly even wen termite activity was found, its consistent non-treatment causing additional damage, and its hiding the truth from the Weatherbys for almost thirty (30) years justifies the imposition of punitive damages. THEREFORE, the arbitrator makes the award shown below: Incidental Damages: Initial Termite bond wit interest $1,482.00 ‘Termite services paid $4929.00 ‘New bond with Alapest $2,200.00 $8,611.00 Compensatory Damages: Diminished value of home ‘$175,000.00 Repairs, cost paid: 8 25,000.00 Repairs known tobe needed or anticipated: $50,000.00 $250,000.00 n Mental Anguish: Skip Weatherby $100.00.00 Pavicia Weatherby ‘200,000.00 ‘$300,000.00 al Ine compensatory Damage: 5 558,611.00 Punitive Damages: $250,000.00 1,308, 61.00 Attorney's Expenses to be paid by Respondent 520,000.00 “Attorney's fees—t be paid by Respandent- 25% of (Claimant's Award samaszs Fees, expenses due Claimant's attorney fram, Respondent ‘sa40,152.75 TOTAL DUE FROM RESPONDENT TO CLAIMANT AND TO HER ATTORNEY $1, 685,763.75 “The above sums ae tebe pald ono before thirty (30) days from the date ofthis Award. The administrative fees of the American Arbitration Association originally pid by the Claimant a ‘he amount of $200.00 and by Respondents inthe annount of $2200.00 shal be borne as, ‘ncured. The compensation of the arbiator totaling 6,000.00, orginally pa solely by Respondent, hal be borne a incurred. ‘This Award isin full seulement of all elaims and counerlaims submited to this Arbitration, All claims aot expressly grant herein are herby deaies $0 ORDERED this 23 Zday ot feds a: z