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Apodaca v. AAA Gas Co.3/11/2003
he parties alone, however, "is not enough to justify a reduction in the cost award;" a court must also consider the losing party's ability to pay. Key, 2000-NMSC-010, 15. Nonetheless, " f the trial court exercises its discretion not to award costs to the prevailing party it should articulate the reasons for its ruling, unless the basis for denying costs is readily apparent on the face of the record." Id. 9 (internal quotation marks and citation omitted).
After hearing arguments from the parties, the trial court ruled:
I agree with you, Mr. Morgan, that on the basis of the facts known to this Court and on the basis of the Court's reading of Gallegos v. Southwest Community Health Systems and Key v. Chrysler, . . .it is my view that an award of costs against the unsuccessful plaintiffs in this matter, given the disparity of financial resources and for the other reasons advanced by plaintiffs' counsel, that the award of costs is denied.
While the record indicates that the court considered the disparity of resources between the parties, its reference to Gallegos and Key and "the other reasons advanced by Plaintiffs' counsel," indicates that this was not the court's sole consideration. We review the record to determine if there is a reasonable basis for the denial. Key, 2000-NMSC-010, 9.
Both at the hearing on Defendants' cost bills and in Plaintiffs' objections to Defendants costs bill and supporting memorandum, Plaintiffs' argument focused on their financial inability to pay a cost award. Counsel represented that Plaintiffs owed $28,000 in legal fees which they were unable to pay and he did not expect to collect. Counsel also presented evidence that Mr. Apodaca had just returned to work, some three years after the accident. He worked on a part-time basis as a school bus driver for $8.30 per hour and earned a small salary of approximately $800 per month as a pastor. Mrs. Apodaca did not work outside the home. Together, their annual gross income was roughly $15,600, a monthly income of $1,450. Moreover, Mr. Apodaca expected to have hand surgery which would entail an eighteen to twenty-four month recovery period during which he would be unable to work as a bus driver. The Velasquezes were somewhat better off. Although they earned a combined annual gross income of $56,400, they supported two young children, and Mr. Velasquez was attempting to replace approximately $200,000 worth of tools lost in the explosion that were his livelihood. Counsel also presented an affidavit from Plaintiffs itemizing their expenses and assets. After bills, the Apodacas had about $100 "extra" money per month and the Velasquezes had about $200 per month.
As for the income generated from the settlement with Fisher Controls, we find the trial court had ample knowledge of that agreement and its contents even though Plaintiffs were never required to disclose it to AAA Gas for purposes of assessing costs. The record shows that the trial court inspected the sealed agreement in camera after an earlier evidentiary hearing. At that time, the court indicated it had reviewed the amount of the award. Having had access to this information, we conclude that the court was not required to disclose the confidential agreement to the opposing parties. We find that Plaintiffs did disclose the settlement to the trial court and that the court could take that information into consideration in its assessment of the cost award.
In light of the evidence above, we conclude that the trial court's decision to deny Defendant's costs was reasonable and not an abuse of discretion. Consistent with our case law, the court did not limit its consideration to the parties' disparity in wealth. I
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