Victory! Overhead Payments Restored in Alabama!

On December 26, 2006, the Alabama Supreme Court restored overhead payments to court-appointed counsel who represent indigent persons charged with criminal offenses. The overhead payments had been suspended in February 2005, after the Alabama attorney general issued an opinion stating that the payment of overhead expenses was not required by statute. The Supreme Court disagreed with the attorney general – unanimously – in Wright v. Childree. As a result, court-appointed counsel will be paid overhead expenses in the future, and will be repaid overhead expenses that had been denied since February 2005.

The entire history of the dispute over overhead fees follows. To go to the Supreme Court’s opinion, click here.

The dispute involving overhead payments goes back many years. Alabama law provides that court-appointed attorneys must receive a proscribed hourly rate plus “reasonably incurred expenses.” In 1994, the Alabama Court of Criminal Appeals interpreted reasonable expenses to include overhead expenses. May v. State, 672 So.2d 1307 (Ala. Crim. App. 1994).

In 1999, the law governing court-appointed counsel fees was amended to say that the reimbursed expenses had to be incurred “in the defense of [the] client.” This change was not initially thought to effect the payment of overhead costs, and those payments continued. However, in March, 2002, a minority of justices of the Alabama Supreme Court asserted in a footnote that the 1999 amendment was intended to eliminate the payment of office overhead expenses. Lyons v. Norris, 829 So.2d 748 (Ala. 2002).

In response to the Supreme Court’s decision, the Alabama legislature passed a Joint Resolution declaring that the intent of the 1999 amendment was not to eliminate reimbursement of overhead expenses. Nevertheless, a couple of years later, the state comptroller requested that the attorney general issue a letter opinion on whether overhead expenses remained subject to reimbursement under Alabama law.

The Attorney General issued Opinion 2005-063 and took the position that under the 1999 amendment overhead expenses were not subject to reimbursement. Following this opinion, in early 2005, the state comptroller began to deny overhead payments.

To read the Attorney General’s decision, click here.

The comptroller’s action was challenged by a single attorney who frequently accepts appointments to represent indigent defendants. The attorney asserted that the clear intent of the legislature, evidenced by the 2002 joint resolution, among other things, was that payment of overhead costs continue. The Montgomery County Circuit Court agreed and ordered the comptroller to make all overhead payments denied, dating back to the change of policy in early 2005.
    To read the court’s decision, click here.

    Both sides appealed the decision to the Alabama Supreme Court – the comptroller, challenging the interpretation of the statute and history adopted by the court, and the attorney, challenging a denial of fees. On December 26, 2006, the Supreme Court unanimously ruled that the legislature never evidenced an intent to dramatically alter court-appointed counsel payments. To the contrary, the justices agreed that the 1999 amendment was “subtle” and “did not change the operative phrase.” To read the Supreme Court’s opinion, click here.

    NACDL filed an amicus before the Alabama Supreme Court in support of restoring the overhead payments. The brief was written by Steven Glassroth, who also argued the position of amicus before the court. To read the amicus brief, click here.



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