KeyCite Yellow Flag – Negative Treatment

65 So.3d 22

District Court of Appeal of Florida,

Fourth District.

Roberta SANTINI, M.D., and Donald R. McCoy, Appellants,

v.

CLEVELAND CLINIC FLORIDA, a not-for-profit corporation, and Bartley C. Miller, Appellees.

Nos. 4D09–451, 4D09–673, 4D09–3022.

|

May 11, 2011.

|

Rehearing Denied July 26, 2011.

Synopsis

Background: Attorney, forced to withdraw from representation of client in employment discrimination case when he was suspended for unethical conduct, filed motion to enforce charging lien he placed on settlement funds ultimately obtained by lawyer who represented client during attorney’s suspension. The Seventeenth Judicial Circuit Court, Broward County, Richard D. Eade, J., awarded fees and costs to attorney and ordered sanctions against client and lawyer representing client in the charging lien matter.

 

Holdings: The District Court of Appeal, held that:

 

[1] attorney who withdrew from representation before the occurrence of contingency named in contingency fee agreement forfeited all rights to receive compensation from client;

 

[2] principles governing an attorney’s entitlement to recover fees under a contingency fee agreement would apply, even though fee agreement with client did not comply with rules of professional conduct;

 

[3] quantum meruit award that exceeded fees agreed to under contingency fee agreement was improper;

 

[4] trial court erred in not limiting final judgment to the escrowed settlement funds;

 

[5] claim that settlement agreement was not final had a good faith basis and would not support award of sanctions;

 

[6] trial court’s imposition of sanctions upon attorney’s motion violated due process; and

 

[7] sua sponte award of appellate attorney fees against attorney was warranted.

 

Reversed and remanded.

 

 

 

West Headnotes (23)

 

 

[1]

 

Appeal and Error

Cases Triable in Appellate Court

Appeal and Error

Attorney fees

 

 Appellate court reviews trial court orders on attorney fees for an abuse of discretion; appellate court has de novo review, however, of the trial court’s interpretation of law.

1 Cases that cite this headnote

 

 

 

[2]

 

Attorney and Client

Under contract for contingent fee

 

 Attorney who withdrew from representation of client in employment discrimination case when he was suspended for unethical conduct forfeited all of his rights to receive compensation from client, where attorney had agreed to represent client on a contingency fee basis, attorney withdrew before the contingency occurred, and attorney’s withdrawal was not made necessary by client’s conduct.

1 Cases that cite this headnote

 

 

 

[3]

 

Attorney and Client

Under contract for contingent fee

Attorney and Client

Requisites and validity of contract

 

 Principles limiting an attorney’s entitlement to recover fees under a contingency fee agreement when the attorney either withdraws or is discharged prior to the contingency occurring continue to protect a client even where the contingency fee agreement between the client and attorney does not conform to the rules of professional conduct; an attorney who violates the rules of professional conduct by entering into a non-conforming agreement will not be able to collect more fees based merely on the non-conformance. West’s F.S.A. Bar Rule 4–1.5(f)(2).

1 Cases that cite this headnote

 

 

 

[4]

 

Attorney and Client

Premature Termination of Relation

 

 Conventional lodestar approach for determining a reasonable attorney fee, requiring the trial court to compute the number of hours reasonably spent in providing the services and a reasonable hourly rate, does not apply to determine a quantum meruit award to an attorney discharged without cause prior to resolution of the client’s case; rather, the court is to consider the totality of the circumstances and award the actual value of the services to the client.

Cases that cite this headnote

 

 

 

[5]

 

Attorney and Client

Specific services and particular cases

 

 Trial court’s quantum meruit award to discharged attorney following $500,000 settlement of client’s employment discrimination claim was erroneously unfair to client, where award allowed attorney to recover more than 50% of the settlement, despite attorney’s continued assurances that, under no circumstances, would fees and costs ever exceed 50% of any recovery.

Cases that cite this headnote

 

 

 

[6]

 

Attorney and Client

Premature Termination of Relation

 

 A quantum meruit award to an attorney discharged without cause prior to resolution of the client’s case must be fair to both the attorney and client.

1 Cases that cite this headnote

 

 

 

[7]

 

Attorney and Client

Specific services and particular cases

 

 In calculating quantum meruit award to discharged attorney, trial court was required to consider the harm client suffered as a result of the dismissal of her federal claim due to attorney’s untimely filing, and the benefit attorney received in having opposing party waive its right to excess fees that the federal court found attorney, though his own misconduct, to have caused opposing party to incur.

Cases that cite this headnote

 

 

 

[8]

 

Appeal and Error

Cases Triable in Appellate Court

 

 A trial court’s decision concerning a litigant’s entitlement to prejudgment interest is reviewed de novo.

1 Cases that cite this headnote

 

 

 

[9]

 

Interest

Particular cases and issues

 

 Where an attorney obtains a judgment against a client for services rendered, the attorney is entitled to prejudgment interest on the award, even if the recovery is based on quantum meruit; in such a case, interest accrues from the date the entitlement to attorney fees is fixed through agreement, arbitration award, or court determination.

1 Cases that cite this headnote

 

 

 

[10]

 

Attorney and Client

Subject-Matter to Which Lien Attaches

 

 An attorney’s charging lien cannot attach to property not involved in the suit and not before the court.

Cases that cite this headnote

 

 

 

[11]

 

Attorney and Client

Judgment or proceeds thereof

 

 In ruling on attorney’s motion to enforce a charging lien placed on settlement funds obtained in employment discrimination action, trial court erred in not limiting final judgment to the escrowed settlement funds.

Cases that cite this headnote

 

 

 

[12]

 

Appeal and Error

Costs and Allowances

 

 Appellate court will only reverse a trial court’s decision to impose sanctions if the trial court has abused its discretion.

1 Cases that cite this headnote

 

 

 

[13]

 

Appeal and Error

Abuse of discretion

 

 If reasonable men could differ as to the propriety of the action taken by the trial court, then the action is not unreasonable and there can be no finding of an abuse of discretion.

Cases that cite this headnote

 

 

 

[14]

 

Compromise and Settlement

Making and Form of Agreement

 

 Settlement agreement specifically giving plaintiff twenty-one days to consult with an attorney before signing/executing and then another seven days, after signing, to revoke before the agreement would become enforceable was not binding on plaintiff until seven days after she signed it.

Cases that cite this headnote

 

 

 

[15]

 

Attorney and Client

Liability for costs;  sanctions

 

 Claim raised by lawyer representing client upon an attorney’s motion to enforce charging lien placed on settlement funds in employment discrimination action, that the settlement agreement was not final, had a good faith factual and legal basis, and thus imposition of sanctions against lawyer for raising the claim was an abuse of discretion; although parties to discrimination action had agreed on the total amount of settlement and non-disclosure terms, agreement provided client a right to legal consultation and was not binding on client until seven days after she signed it, and client had elected not to execute agreement due to dissatisfaction with language that paid 50% of settlement proceeds directly to legal counsel for attorney fees. West’s F.S.A. § 57.105.

Cases that cite this headnote

 

 

 

[16]

 

Attorney and Client

Liability for costs;  sanctions

 

 Trial court could not impose sanctions on attorney for raising unsupported claim without making an express finding of bad faith. West’s F.S.A. § 57.105.

Cases that cite this headnote

 

 

 

[17]

 

Attorney and Client

Liability for costs;  sanctions

Constitutional Law

Penalties, fines, and sanctions in general

 

 Trial court was required, as a matter of due process, to hold a hearing on the issue of good faith before imposing sanctions on attorney for raising unsupported claims. U.S.C.A. Const.Amend. 14; West’s F.S.A. § 57.105.

1 Cases that cite this headnote

 

 

 

[18]

 

Attorney and Client

Liability for costs;  sanctions

 

 Statute governing award of sanctions against an attorney for raising unsupported claims does not authorize the award of costs. West’s F.S.A. § 57.105.

Cases that cite this headnote

 

 

 

[19]

 

Attorney and Client

Liability for costs;  sanctions

 

 Where a party filed motion to sanction opposing attorney for raising unsupported claims, trial court could not properly adopt the party’s motion as its own in order to circumvent twenty-one day notice provisions of the statute governing such motions by a party. West’s F.S.A. § 57.105(4).

1 Cases that cite this headnote

 

 

 

[20]

 

Costs

Duties and proceedings of taxing officer

 

 Trial court could not properly adopt one party’s proposed order on a motion for attorney fees and costs without giving opposing party an opportunity to review the order.

1 Cases that cite this headnote

 

 

 

[21]

 

Motions

Form and Requisites of Orders

 

 A court should never direct only one side to prepare an order without assuring that the opposing party has had the opportunity to comment or object to its contents, or prepare its own submission.

Cases that cite this headnote

 

 

 

[22]

 

Costs

Nature and form of judgment, action, or proceedings for review

 

 District Court of Appeal, considering client’s appeal from trial court’s enforcing of attorney’s charging lien and imposition of sanctions, would sua sponte impose appellate attorney fees against attorney for its frivolous defense of patently erroneous trial court orders; client correctly raised at least fifteen reversible errors, yet attorney and his counsel callously refused to concede even a single one, attorney incredibly filed a motion for sanctions against client on grounds that client’s arguments on appeal were allegedly unsupported in fact or law, and trial court’s orders contained a number of patent errors, at least some of which attorney had an ethical duty to concede both in the trial court and on appeal.

2 Cases that cite this headnote

 

 

 

[23]

 

Appeal and Error

Necessity of New Trial

 

 While District Court of Appeal could not sanction a party or its counsel for any actions that occurred in the trial court, trial court would be directed to consider sanctions against attorney and his counsel on remand following reversal of trial court’s orders enforcing an attorney’s charging lien and imposing sanctions against client, where appellate attorney fees had been imposed against attorney for the frivolous defense of patently erroneous trial court orders, at least some of which attorney and his counsel had an ethical duty to concede both in the trial court and on appeal.

1 Cases that cite this headnote

 

 

 

Attorneys and Law Firms

*25 Donald R. McCoy, Fort Lauderdale, for appellants.

Susan L. Dolin, Pembroke Pines, for appellee Bartley C. Miller.

Opinion

PER CURIAM.

 

In this matter, we undo a series of egregious wrongs perpetrated upon the appellants, all of which were compounded by the assertion of frivolous defenses of numerous and patently erroneous trial court orders.

 

Dr. Roberta Santini appeals an order enforcing a charging lien filed by her former attorney, Bartley C. Miller. She asserts that Miller forfeited his rights to compensation pursuant to a contingency fee agreement because he withdrew his representation prior to the occurrence of the contingency. We agree that the trial court erred in permitting Miller to enforce his charging lien, reverse the order and remand for the trial court to vacate the charging lien. We also reverse the trial court’s awards of sanctions against both Donald R. McCoy, Dr. Santini’s attorney in the charging lien matter, and Dr. Santini personally. Finally, we also find that this is one of those “rare circumstances” in which it is appropriate to impose sanctions against an appellee and we therefore sua sponte award appellate attorney’s fees to the appellants.

 

 

FACTUAL AND PROCEDURAL BACKGROUND

In 1996, while Dr. Santini was a radiologist at the Cleveland Clinic Florida (the “Clinic”), Dr. Santini hired attorney Miller to represent her in an employment discrimination and sexual harassment action against the Clinic. At the time Dr. Santini retained Miller, he was a managing partner at the law firm of Panza, Maurer, Maynard and Neel, P.A. (“Panza firm”). Dr. Santini signed a contingency fee agreement (the “Panza Firm Employment Contract”) in which she retained the Panza firm to represent her. The employment contract provided for compensation “contingent upon recovery,” and specified the percentages of any recovery to be paid as fees. Additionally, the contract provided that the “client will not be responsible for any costs or attorney fees in this matter should the client not prevail.”

 

Throughout the course of Miller’s representation in the underlying matter, he twice moved to different law firms yet Dr. Santini decided to continue with the representation provided by Miller each time. For whatever reason, however, Miller and Dr. Santini did not execute any new written contingency fee agreements even though Miller uninterruptedly continued his representation. Since July 1, 1999, Miller worked for his own practice, Bartley C. Miller & Associates.

 

In 1997, Miller, on behalf of Dr. Santini, filed a charge with the Equal Employment Opportunity Commission (“EEOC”) and with the Broward County Human Rights Division against the Clinic for gender and age discrimination. Dr. Santini received a “Right to Sue Notice” from the EEOC on or before February 2, 1998. Thereafter, on May 29, 1998, Miller filed a complaint in federal district court on behalf of Dr. Santini. The federal district court granted summary judgment for the Clinic finding Dr. Santini’s claims to be time-barred because she had failed to file them within ninety days of receipt of notice from the EEOC.

 

The federal court also issued an order imposing sanctions upon Miller for attempting to conceal the date upon which *26 Dr. Santini received the original notice from the EEOC.1 The sanctions award required Miller to pay the Clinic approximately $20,000 in excess attorney’s fees.

 

Miller then filed the instant action in state court, asserting the same claims under the Florida Civil Rights Act as had been filed and dismissed in federal court.2

 

Because of Miller’s conduct in the federal case, the Florida Supreme Court suspended him from the practice of law for one year. See Fla. Bar v. Miller, 863 So.2d 231, 235 (Fla.2003). Although the suspension was scheduled to begin in October 2003, Dr. Santini signed an affidavit authored by Miller, requesting that his suspension be postponed because her trial date was near. The Florida Supreme Court delayed Miller’s suspension until November 2003. The trial, however, was postponed for an additional year. Because of his suspension by the Florida Supreme Court, Miller withdrew from further representation of Dr. Santini in November 2003. Indicating that he no longer desired to practice law, Miller did not seek Florida Bar reinstatement either after serving his one-year suspension, or prior to filing a charging lien in this case.

 

Prior to his suspension, Miller arranged for Justin M. Senior to represent Dr. Santini during Miller’s suspension. Senior had worked on Dr. Santini’s appeal and had, under Miller’s supervision, worked on Dr. Santini’s case when both were employed by the Panza firm. A few months before his one-year suspension was scheduled to begin, Miller signed a fee sharing agreement with Senior which specifically referred to a “contingency fee contract between Dr. Santini and Miller.”3

 

Senior represented Dr. Santini at a three-week jury trial beginning in November 2004. No verdict was reached and the case was scheduled for retrial in October 2005. On the eve of the retrial, Senior negotiated a $500,000 settlement with the Clinic’s attorneys.

 

In December 2005, Senior sent Dr. Santini “a new release with the Clinic’s changes.” It specified that from the $500,000 settlement proceeds, the Clinic would provide a check in the amount of $250,000 “made payable to the Law Offices of Justin M. Senior, P.A. Trust Account, for Santini’s attorneys’ fees and costs.” Dr. Santini, however, refused to sign the agreement claiming that she had not agreed to the provision setting the amount of the attorney’s fees. Dr. Santini was willing to sign an agreement for the $500,000 settlement and indicated the division (between her portion and any and all lawyer’s fees and costs) would be “more or less” fifty-fifty. She was unwilling, however, to commit because she thought the details of the attorney’s fees were still being discussed.

 

Dr. Santini requested from Senior a reduction in Miller’s portion of the fees because *27 of the delays in the case which could have been avoided if Miller had timely filed the federal case. Because Miller and Senior refused to adjust their demand for half the settlement, Dr. Santini sought the second opinion of another attorney, Donald R. McCoy, who is also an appellant in this appeal.

 

 

Miller’s Motion to Enforce His Charging Lien and the Trial Court’s Resultant Final Judgment

In December 2005, Miller demanded that Dr. Santini pay him $157,650 as his share of the $250,000 contingency fee. McCoy immediately asked for copies of the fee agreement, cost and expense invoices, and any other records on which Miller based his claims. Instead of providing these documents, Miller filed an attorney’s charging lien on March 10, 2006.

 

In December 2006, Miller sent Dr. Santini several invoices claiming that she owed him $360,773.92 (a year earlier he had sought only $157,650). These invoices included attorney’s fees of $313,982.50 based on an hourly rate of $325 per hour and costs totaling $46,791.42.

 

On March 13, 2007, Miller filed a motion to enforce his charging lien. The motion provided that “[a]lthough [Miller] requested that she do so, [Dr. Santini] never executed a written contingency fee agreement. The parties at all times understood, however, that [Miller] was to be paid a reasonable fee for his services.” Dr. Santini filed a memorandum in opposition to this motion on April 24, 2007, in which Dr. Santini contended that she had signed a written contingency fee agreement with the Panza firm when Miller was a managing partner there and that “[a]t all times during the representation” both parties understood that Miller was representing Dr. Santini under a contingency fee agreement.4

 

During the first hearing on Miller’s motion to enforce his charging lien, and before taking evidence, the trial court ruled that Miller could recover in quantum meruit because his contingency fee agreement with Dr. Santini was not in writing, as required, and because Miller did not voluntarily withdraw but was forced to do so when he was suspended for unethical conduct.

 

At the conclusion of the testimony the trial court found that Miller should be awarded fees of $255,000 based upon an hourly rate of $300—instead of $325 which he claimed—and a reduced number of hours. With the agreed expenses of $43,000, the court awarded Miller $298,000. Over Dr. Santini’s objection, the court then added $72,180.36 to the award as prejudgment interest, calculated from October 15, 2005.

 

Final judgment was entered for a total award of fees and costs in the amount of $370,180.36 of which the $43,000 awarded as costs has been paid.

 

 

Sua Sponte Sanctions Against McCoy

In his first memorandum opposing Miller’s motion to enforce the charging lien, McCoy, on behalf of Dr. Santini, claimed that the negotiated settlement with the Clinic was never finalized because of the fee dispute. At the first and in subsequent hearings, the question was raised as to the finality of the settlement. Miller’s counsel assured the court the settlement was final whether or not Dr. Santini signed it. Each time the issue was raised, McCoy stated that Dr. Santini did not agree that the settlement was finalized.

 

The trial court raised the issue again at a hearing on September 24, 2007. After *28 conferring with Dr. Santini, McCoy negotiated an agreement with the Clinic’s attorney the following day for a final settlement agreement under which the $500,000 proceeds would be placed in an escrow account, subject to a consideration, decision and ultimate order of the court. The provision for payment of $250,000 directly to Senior for attorney’s fees and costs (originally suggested by Senior in December 2005) was to be deleted from the final agreement; the parties would execute mutual releases and Dr. Santini would stipulate to the dismissal of the case against the Clinic. These terms were recited on the record and approved by the trial court on September 26, 2007.

 

Miller’s counsel then made an ore tenus motion to sanction McCoy for several alleged “misrepresentations” including McCoy’s statements that the settlement agreement was never finalized prior to the stipulation entered into with the Clinic’s attorney that day. Miller’s counsel further moved to strike Dr. Santini’s pleadings, moved for an order to pay Miller’s fees and costs, and moved for the court to refer McCoy to The Florida Bar.

 

McCoy argued that Miller’s counsel was asking the trial court to sanction McCoy “mid-stream in this proceeding without any regard” for the twenty-one day “safe harbor” provision found in section 57.105(4), Florida Statutes. Miller’s counsel contended that the trial court should instead impose sanctions under its “inherent power.” The trial court ruled that it would impose the requested sanctions sua sponte under both section 57.105 and its inherent authority.5 Therefore, the trial judge reasoned, the twenty-one day notice period was unnecessary.

 

McCoy moved for reconsideration and submitted the affidavit of Kevin P. Tynan, an attorney who has expertise regarding the Rules Regulating The Florida Bar—in particular, the Rules of Professional Conduct—and experience as branch staff counsel of the Fort Lauderdale office of The Florida Bar. Tynan reviewed the pertinent trial transcripts and other documents, as well as the applicable Bar rules and legal precedent and concluded, “It is my expert opinion that based upon all of the foregoing that McCoy’s assertion that the settlement was not final was made in good faith, in reliance to known facts that do not appear to be controverted, and with the belief that precedent supported this claim.”

 

Inexplicably, the trial court rejected McCoy’s request for an evidentiary hearing on the issue. On January 29, 2009, the trial court entered an order determining the amount of sanctions and awarding $5,172.40 in costs and $5,665.00 in fees against McCoy.

 

 

Miller’s Motion for Attorney’s Fees and Costs To Enforce His Charging Lien

In November 2008, the trial court granted Miller’s motion for leave to untimely file a 173–page motion seeking to recover his attorney’s fees and costs incurred in prosecuting his motion to enforce the charging lien. The motion asked the trial court to sanction Dr. Santini and her counsel “sua sponte” under section 57.105, Florida Statutes, and under its “inherent power” over the conduct of litigants.

 

McCoy filed a memorandum in opposition. At the hearing on Miller’s motion for sanctions, McCoy requested an evidentiary hearing regarding his litigation conduct and that of his client before any sanctions *29 were imposed. The trial court, however, summarily granted Miller’s motion.6

 

The trial court then heard argument regarding Miller’s motion for an award of all of the fees and costs he expended enforcing his charging lien. Citing case law, McCoy specifically asked for an evidentiary hearing regarding the broad allegations of misconduct alleged in Miller’s motion. The trial court made no findings or conclusions on the record other than uttering the words “res ipsa loquitur” and directed Miller’s counsel to submit an order and to “pass it past Mr. McCoy … if he objects, we’ll have a hearing.”7

 

In April 2009, Miller’s counsel submitted an eighteen-page proposed order to the trial court, without first showing it to McCoy. Miller’s counsel sent the order to McCoy at the same time that she submitted it to the trial court. McCoy filed objections to entry of this order and moved to allow thirty days to respond. McCoy objected on the grounds that the trial court had not directed the parties to submit findings and conclusions, and on the grounds that Miller had violated both local rules and the trial court’s directions by submitting the proposed orders without first showing them to opposing counsel.

 

Incredibly, the lower court nonetheless signed the proposed order without change, without any hearing, and without ruling on Dr. Santini’s objections. The trial court denied Dr. Santini’s timely filed motion for rehearing and a timely notice of appeal was filed.

 

 

DISCUSSION

Miller’s Forfeiture of His Right to Compensation from Dr. Santini

[1] “We review trial court orders on attorney’s fees for an abuse of discretion. We have de novo review however of the trial court’s interpretation of law.” Robin Roshkind, P.A. v. Machiela, 45 So.3d 480, 481 (Fla. 4th DCA 2010) (citations omitted).

 

[2] The Florida Supreme Court has established several rules of law regarding an attorney’s entitlement to recover fees under a contingency fee agreement where the attorney either withdraws or is discharged prior to the contingency occurring. In Rosenberg v. Levin, 409 So.2d 1016 (Fla.1982), the Florida Supreme Court addressed the situation where a client discharges the attorney without cause under a contingency fee agreement and held “that an attorney employed under a valid contract who is discharged without cause before the contingency has occurred or before the client’s matters have concluded can recover only the reasonable value of his services rendered prior to discharge, limited by the maximum contract fee.” Id. at 1021. In explaining its reason for limiting recovery to the maximum contract fee, the Florida Supreme Court wrote that it would be “unacceptable” for an attorney “to receive a fee greater than he bargained for under the terms of his contract.” Id.

 

*30 Whereas Rosenberg addressed situations involving lawyer/client contractual relationships where the attorney is discharged without cause, this court has weighed in on matters where an attorney is discharged for cause. In Searcy, Denney, Scarola, Barnhart & Shipley, P.A. v. Scheller, 629 So.2d 947, 954 (Fla. 4th DCA 1993), we held that when an attorney has a written contingency fee agreement and is discharged for cause, the lawyer’s fees should be based on the modified quantum meruit fee as articulated in Rosenberg reduced by the amount of the damages suffered by the client as a result of the lawyer’s conduct that led to the discharge. Id.

 

In Faro v. Romani, 641 So.2d 69 (Fla.1994), the Florida Supreme Court addressed the situation where an attorney voluntarily withdraws from representing a client—before the contingency occurred—but where the withdrawal was necessitated by questionable client conduct. The supreme court held:

[W]hen an attorney withdraws from representation upon his own volition, and the contingency has not occurred, the attorney forfeits all rights to compensation…. We further hold, however, that if the client’s conduct makes the attorney’s continued performance of the contract either legally impossible or would cause the attorney to violate an ethical rule of the Rules Regulating The Florida Bar, that attorney may be entitled to a fee when the contingency of an award occurs.

Id. at 71 (emphasis added). Subsequent cases have steadfastly emphasized that the withdrawing attorney forfeits all rights to compensation unless the attorney can show that the client’s conduct made the withdrawal necessary. See, e.g., DePena v. Cruz, 884 So.2d 1062, 1063–64 (Fla. 2d DCA 2004); Carbonic Consultants, Inc. v. Herzfeld & Rubin, Inc., 699 So.2d 321, 324 (Fla. 3d DCA 1997); Kocha & Jones, P.A. v. Greenwald, 660 So.2d 1074, 1075 (Fla. 4th DCA 1995).

 

We also find cases from other jurisdictions persuasive in holding that withdrawing from a case because of a bar suspension constitutes withdrawing on one’s own volition. See, e.g., Royden v. Ardoin, 160 Tex. 338, 331 S.W.2d 206, 209 (1960) (“His disbarment or suspension is considered tantamount to and to have the same effect as a voluntary abandonment, for the attorney by knowingly and willfully practicing such a course of conduct that would lead to the termination of his right to practice, renders it impossible to complete the work that he engaged to perform.”).

 

[3] Almost defiantly, Miller claims that Faro does not apply here because the contingency fee agreement he originally entered into with Dr. Santini violated the Rules Regulating The Florida Bar because a new written contingency fee agreement was not executed following any of the multiple times when Miller moved from one firm to the next.8 In essence, Miller incredulously claims that Florida law requires that he be permitted to recover more from his former client by violating the rules governing contingency fees than  *31 he would be entitled to if he had followed them.

 

To support this outrageously brazen contention, Miller points to a single sentence in Chandris, S.A. v. Yanakakis, 668 So.2d 180 (Fla.1995), where the Florida Supreme Court wrote, “Florida contingent fee agreements entered into by attorneys subject to our regulations but which do not comply with the regulations are likewise void as against the public interest.” Id. at 181. He argues that the contingency fee agreement here violates the Rules Regulating The Florida Bar because as a result of his exit from the Panza firm and his subsequent reported failures to propose new written contingency fee agreements, his representation of Dr. Santini became grounded on an “oral agreement” and thus void.9

 

Not surprisingly, Chandris does not support Miller’s argument.10 To the contrary, later in the Chandris opinion where the supreme court addressed the issue of contingency fee agreements that do not adhere to the rules, the court explicitly avoided repeating language that such contracts are void (this is in contrast to its detailed analysis of agreements entered into by non-members of The Florida Bar which it again reiterated were void contracts). In particular, the supreme court wrote:

 

Likewise, we hold that a contingent fee contract entered into by a member of The Florida Bar must comply with the rule governing contingent fees in order to be enforceable. We have determined that the requirements for contingent fee contracts are necessary to protect the public interest. Thus, a contract that fails to adhere to these requirements is against public policy and is not enforceable by the member of The Florida Bar who has violated the rule. Moreover, enforcing contingent fee agreements that are not in compliance with the rule would be unfair as well as constitute a competitive disadvantage to members of The Florida Bar who do comply with the rule.

Chandris, 668 So.2d at 185–86 (emphasis added) (footnote omitted). Also, in the opinion, the Florida Supreme Court qualified its overruling of previous cases which had found “contingent fee agreements to be enforceable despite some violation of the Rules Regulating The Florida Bar.” Id. at 185. The court expressly disapproved of those cases only “to the extent they may be read to hold that a contingent fee contract which does not comply with … the Rules Regulating The Florida Bar is enforceable by an attorney who claims fees based upon a noncomplying agreement.” Id. (emphasis added). Here, it is the client and not the attorney who seeks to enforce the contingency fee agreement.

Accepting Miller’s selective reading of Chandris would harm the public and put *32 attorneys who comply with the rules at a competitive disadvantage. See id. at 186. Under such an interpretation, an attorney who entered into an oral contingency fee agreement with a client would be entitled to recover in quantum meruit even if the client did not prevail in the underlying case. Such a result would be absurd and simply unacceptable.11 Likewise, it is “unacceptable” to us to allow Miller to impose a charging lien based on a quantum meruit determination far in excess of what he bargained for with Dr. Santini. See Rosenberg, 409 So.2d at 1021 (holding that “for the attorney to receive a fee greater than he bargained for under the terms of his contract … [is] unacceptable”).

 

Thus, we hold that the rules of Rosenberg, Scheller, and Faro still protect a client even where the contingency fee agreement between the client and attorney does not conform to the Rules Regulating The Florida Bar. An attorney who violates the rules of professional conduct by entering into a non-conforming agreement will not be able to collect more fees based merely on the non-conformance.

 

Applying the Faro rule and subsequent case law to the present case, Miller forfeited all of his rights to receive compensation from Dr. Santini because Miller had agreed to represent Dr. Santini on a contingency fee basis, Miller withdrew before the contingency occurred, and Miller’s withdrawal was not made necessary by Dr. Santini’s conduct. Accordingly, the trial court erred in granting Miller’s motion to enforce his charging lien.12

 

 

Other Glaring Errors with Respect to the Charging Lien Final Judgment

We do not take any joy in documenting the lower court’s numerous errors. But because we have reluctantly exercised our authority to sua sponte impose fees against the appellee, Miller, the glaring errors of the trial court become necessarily noteworthy. The trial court clearly, fundamentally and unquestionably erred (1) in its application of existing law in calculating quantum meruit fees; (2) in its calculation of prejudgment interest; and (3) in not limiting the final judgment to the proceeds of the settlement in this case.13

 

 

*33 Erroneous Quantum Meruit Calculations

[4] In Searcy, Denney, Scarola, Barnhart & Shipley, P.A. v. Poletz, 652 So.2d 366 (Fla.1995), the Florida Supreme Court addressed “the proper criteria for determining the quantum meruit recovery of an attorney discharged without cause prior to resolution of the client’s case.” Id. at 367.14 The conventional loadstar approach requires the trial court to compute the number of hours reasonably spent in providing the services and a reasonable hourly rate. Id. In Poletz, however, the supreme court explained:

 

The conventional lodestar approach is ill-suited for the task of assessing attorney’s fees due as damages for breach of an agreement for the payment of fees because it does not allow for consideration of “the totality of the circumstances surrounding the professional relationship.” Unlike an award of attorney’s fees to a prevailing party, a quantum meruit award must take into account the actual value of the services to the client. Thus, while the time reasonably devoted to the representation and a reasonable hourly rate are factors to be considered in determining a proper quantum meruit award, the court must consider all relevant factors surrounding the professional relationship to ensure that the award is fair to both the attorney and client.

Id. at 368–69 (emphasis added) (internal citation omitted). The supreme court then specifically listed “the fee agreement itself, the reason the attorney was discharged, [and] actions taken by the attorney or client before or after discharge” as examples of factors a court should consider. Id. at 369.

[5] [6] The holding in Poletz applies equally here: “the trial court erred as a matter of law by failing to consider the totality of the circumstances present in this case, instead considering only the time reasonably expended and the reasonable hourly rate for the services.” Id. Furthermore, the trial court acknowledged that the amount awarded to Miller might be unfair to Dr. Santini considering the amount of total recovery. Poletz, however, requires that a quantum meruit award must be “fair to both the attorney and client.Id. (emphasis added). In this case, it would not—under anyone’s good faith analysis—be fair to the client to allow Dr. Santini’s attorneys to recover more than 50% of the settlement in light of their continued assurances that, under no circumstances, would their fees and costs ever exceed 50% of any recovery.

 

[7] When determining the actual value of Miller’s services, the trial court refused to hear evidence regarding the harm Dr. Santini suffered as a result of the dismissal of her federal claim. Miller clearly breached his duty to Dr. Santini in failing to timely file the federal case yet the trial court found that Dr. Santini suffered no harm because she was ultimately able to settle with the Clinic. The trial court also erred in refusing to value the benefit that Miller received in having the Clinic waive its right to excess attorney’s fees that the federal trial court found Miller, through his own misconduct, caused the Clinic to incur.

 

 

Erroneous Prejudgment Interest Calculations

Although there will be no basis to award prejudgment interest on remand because, *34 as set forth above, Miller forfeited all his rights to receive compensation from Dr. Santini, the trial court’s contradictory calculation of prejudgment interest, and Miller’s failure to concede this error, further illustrate our finding that Miller has proceeded with this appeal in blatant bad faith.

 

[8] [9] “A trial court’s decision concerning a litigant’s entitlement to prejudgment interest is reviewed de novo.” McCarthy v. Estate of Krohn, 16 So.3d 193, 195 (Fla. 4th DCA 2009). Where an attorney obtains a judgment against a client for services rendered, the attorney is entitled to prejudgment interest on the award even if the recovery is based on quantum meruit. See id. In such a case, “interest accrues from the date the entitlement to attorney fees is fixed through agreement, arbitration award, or court determination.” Quality Engineered Installation, Inc. v. Higley S. Inc., 670 So.2d 929, 930–31 (Fla.1996).

 

Notwithstanding that the trial court found that the contingency fee agreement between Dr. Santini and Miller was ineffectual, the trial court calculated prejudgment interest from October 15, 2005—the date on which Dr. Santini and the Clinic agreed to settle the case for $500,000. We find this inconsistency puzzling. If the trial court believed that it was bound to exclude all consideration of the contingency fee agreement, then the October 15, 2005 date would be an arbitrary date and not the date that Miller’s entitlement to fees was fixed through agreement.15 If such were the case, the earliest possible date upon which Miller’s fees could be due was the date in which Miller first sent invoices to Dr. Santini—sometime in December 2006. See McLaughlin, Inc. v. Ric–Man Int’l, Inc., 31 So.3d 308, 309 (Fla. 4th DCA 2010).

 

 

Erroneous Limitation of Final Judgment Amount

[10] [11] “By definition, an attorney’s charging lien cannot attach to property not involved in the suit and not before the court.” Cole v. Kehoe, 710 So.2d 705, 706 (Fla. 4th DCA 1998); see also Correa v. Christensen, 780 So.2d 220, 220 (Fla. 5th DCA 2001) (“It is not enough to support the imposition of a charging lien that an attorney has provided his services; the services must, in addition, produce a positive judgment or settlement for the client, since the lien will attach only to the tangible fruits of the services.”).

 

To circumvent this well-established rule, Miller argues that the trial court was not required to limit the final judgment in this case to the escrowed settlement funds because this was a “proceeding in quantum meruit and not based upon a charging lien.” But for the fact that the trial court apparently agreed, this argument would not merit further discussion. On March 13, 2007, Miller filed a verified motion to enforce his charging lien with the trial court handling the original action between Dr. Santini and the Clinic.16 Thus, it escapes *35 us how Miller could now contend in his answer brief that this action was “not based upon a charging lien.”

 

As the underlying action in this case was a motion to enforce a charging lien, the trial court erred in not limiting its final judgment on Miller’s motion to the escrowed settlement funds. See, e.g., Rudd v. Rudd, 960 So.2d 885, 887–88 (Fla. 4th DCA 2007) (“On remand, the language of the charging lien order should be amended to reflect that it is limited in scope to the property before the court by virtue of the [underlying] action.” (citing Cole, 710 So.2d at 706)).

 

 

Impermissible Sanctions Against McCoy

[12] [13] This court will only reverse a trial court’s decision to impose sanctions if the trial court has abused its discretion. See Boca Burger, Inc. v. Forum, 912 So.2d 561, 573 (Fla.2005). “If reasonable men could differ as to the propriety of the action taken by the trial court, then the action is not unreasonable and there can be no finding of an abuse of discretion.” Canakaris v. Canakaris, 382 So.2d 1197, 1203 (Fla.1980).

 

[14] [15] Here, the trial court clearly abused its discretion in imposing sanctions. First, it was unreasonable for the trial court to find that there was not a good faith factual and legal basis for McCoy’s claim that the settlement agreement was not final under Florida law at the time he raised the issue. The agreement specifically gave Dr. Santini twenty-one days to consult with an attorney before signing/executing and then another seven days, after signing, to revoke before the agreement would become enforceable. Thus, as a matter of contract interpretation, the agreement was not binding on Dr. Santini until seven days after she signed it. Otherwise, the right to consult with an attorney would have no effect. See Barone v. Rogers, 930 So.2d 761, 763–64 (Fla. 4th DCA 2006) (“As settlement agreements are contractual in nature, they are interpreted and governed by contract law.”); Herian v. Se. Bank, N.A., 564 So.2d 213, 214 (Fla. 4th DCA 1990) (“An interpretation of a contract which gives a reasonable, lawful and effective meaning to all of the terms is preferred to an interpretation which leaves a part unreasonable, unlawful or of no effect.”). Dr. Santini was dissatisfied with the language which paid 50% of the settlement proceeds directly to Senior for attorney’s fees. Therefore, before signing the agreement she consulted with another attorney and upon doing so elected not to execute the agreement under its existing terms.

 

The trial court, however, found that the agreement became enforceable as an oral settlement agreement the day Senior agreed with the Clinic on the total amount ($500,000) and non-disclosure terms. The trial court determined that as long as all of the material issues between Dr. Santini and the Clinic were resolved, then the oral settlement was enforceable. In Cheverie v. Geisser, 783 So.2d 1115 (Fla. 4th DCA 2001), however, we reversed a trial court’s finding that the parties had reached a binding settlement agreement even though they had agreed to the total amount of payment. Id. at 1118. Although slightly different from the present case, the facts in Cheverie are similar enough for McCoy to at least make a good faith defense that the settlement agreement was not final.

 

In particular, in Cheverie, we held that for a settlement agreement to be enforceable, it “must be sufficiently specific and *36 mutually agreeable as to every essential element.” Id. (emphasis added) (citation and internal quotation marks omitted). While the trial court could make a finding that Dr. Santini’s concern that half of the proceeds were paid directly to Senior rather than to an escrow account was not an “essential element,”17 McCoy’s argument that this was an essential element was certainly not frivolous, especially considering that Dr. Santini had contacted him because of her dissatisfaction over this specific clause.

 

Thus, because McCoy had a good faith factual and legal basis for his claim, the trial court abused its discretion in sanctioning him for making this argument.

 

[16] [17] Additionally, the trial court made several due process errors with regard to sanctioning McCoy based on section 57.105, Florida Statutes (2007). The most critical were not making express findings of bad faith and never holding a full evidentiary hearing regarding the paramount issue of good faith. See Ferdie v. Isaacson, 8 So.3d 1246 (Fla. 4th DCA 2009). In Ferdie, we stated:

When a trial court imposes liability against counsel for a fee award entered under section 57.105, it “must make [1] an express finding that the claim was frivolous and, … [2] an express finding that the attorney was not acting in good faith based upon the representations of his client.”

Id. at 1250 (citations omitted). We further articulated that “[a] trial court’s decision under section 57.105(1) must be supported by competent substantial evidence; therefore, it follows that a full evidentiary hearing on the good faith issue is necessary.” Id. We then defined a “full hearing” as “one during which the party was represented by counsel, examined witnesses, and had the opportunity to offer evidence.” Id. (citation and internal quotation marks omitted).

 

Here, the trial court summarily imposed liability against McCoy and never made any express findings with regard to the good faith exception. Furthermore, no full evidentiary hearing on good faith ever occurred. In fact, the trial court explicitly denied McCoy’s written motion for reconsideration of the sanctions in which McCoy specifically requested an evidentiary hearing.18

 

[18] The trial court also erred when it awarded costs against McCoy under the section 57.105 motion which is not permitted by the statute. Ferdie, 8 So.3d at 1251 (“Section 57.105 … provides that ‘the court shall award a reasonable attorney’s fee to be paid to the prevailing party,’ but makes no mention of costs.”).

 

[19] Although the trial court’s failure to make any findings regarding bad faith is sufficient to reverse the judgment, McCoy also argues that the trial court’s sanction should be prohibited under section 57.105 because this was actually based on a motion by Miller, and Miller did not comply with the “safe harbor” provisions *37 of the statute. See § 57.105(4), Fla. Stat. (2007). Miller’s counsel made an ore tenus motion to the trial court without ever having served McCoy with the motion. McCoy argued that the motion should be denied because Miller had not given the twenty-one-day notice as required by the statute. Not deterred by the plain reading of the statute, Miller’s counsel then asked the court to punish McCoy under its own “inherent power” to sanction litigants. The trial court—apparently also undeterred—ruled that it was imposing sanctions sua sponte under both section 57.105 and under its inherent authority.

 

The Third District has held that a trial court cannot simply adopt a party’s motion as its own in order to circumvent the safe harbor:

We conclude that this procedure is contrary to the intent of the statute. The legislative intent is to require the twenty-one-day notice whenever a subsection 57.105(5) motion is filed by a party. It would frustrate the legislative intent to avoid the twenty-one-day notice by allowing the court to adopt the party-filed motion as the court’s own. Since this was a party-filed motion, the subsection 57.105(4) notice period had to be observed.

Davidson v. Ramirez, 970 So.2d 855, 856 (Fla. 3d DCA 2007). Although the Second District recently declined to follow Davidson mostly because of factual distinctions, the Second District also noted: “Accepting Davidson’s reasoning at face value would mean that the trial court loses the ability to impose sanctions even when clearly warranted if a party files a section 57.105 motion for sanctions that fails to comply with the twenty-one-day notice requirement imposed on parties.Koch v. Koch, 47 So.3d 320, 324 (Fla. 2d DCA 2010). The First District has held that courts can adopt a party’s motion for sanctions as its own under section 57.105 where procedural rules prevent the moving party from giving twenty-one days’ notice. See Unifirst Corp. v. City of Jacksonville, 42 So.3d 247 (Fla. 1st DCA 2009). Such is not the case here.

 

To the contrary, here, Miller had ample time to give Dr. Santini and McCoy twenty-one days’ notice if he believed Dr. Santini’s claim (that the settlement agreement was not final) was frivolous. The record shows that the trial court only chose to sanction McCoy on its “own initiative” after Miller’s counsel made an ore tenus 57.105 motion, and McCoy objected for not having received the requisite twenty-one day notice under the statute. The trial court seemed to have adopted the motion only to circumvent the safe harbor. This will not stand and the sanctions shall be vacated.

 

The trial court also indicated that it was sanctioning McCoy under its inherent authority. In Moakley v. Smallwood, 826 So.2d 221, 226 (Fla.2002), the Florida Supreme Court recognized that “a trial court possesses the inherent authority to impose attorneys’ fees against an attorney for bad faith conduct.” But the supreme court warned,

In exercising this inherent authority, an appropriate balance must be struck between condemning as unprofessional or unethical litigation tactics undertaken solely for bad faith purposes, while ensuring that attorneys will not be deterred from pursuing lawful claims, issues, or defenses on behalf of their clients or from their obligation as an advocate to zealously assert the clients’ interests. The inherent authority of the trial court, like the power of contempt, carries with it the obligation of restrained use and due process.

Id. at 226–27 (emphasis added). The Florida Supreme Court then clearly laid out *38 the following principles which must be followed before such sanctions will be upheld:

  1. Sanctions “must be based upon an express finding of bad faith conduct.” Id. at 227 (emphasis added).
  2. Sanctions “must be supported by detailed factual findings describing the specific acts of bad faith conduct that resulted in the unnecessary incurrence of attorneys’ fees. Thus, a finding of bad faith conduct must be predicated on a high degree of specificity in the factual findings.” Id. (emphasis added).
  3. “[T]he amount of the award of attorneys’ fees must be directly related to the attorneys’ fees and costs that the opposing party has incurred as a result of the specific bad faith conduct of the attorney.” Id.
  4. The attorney being sanctioned must be given “notice and an opportunity to be heard—including the opportunity to present witnesses and other evidence.” Id.
  5. “If a specific statute or rule applies, the trial court should rely on the applicable rule or statute rather than on inherent authority.Id. (emphasis added).

 

Here the trial court failed to follow at least four out of five of these principles. The trial court made no findings of bad faith (in violation of the first two principles). Also, the trial court denied McCoy’s request for a hearing and the opportunity to be heard. Finally, the trial court wrote that it was sanctioning McCoy because it found that his allegation that the settlement offer was not final until Dr. Santini signed it “had no basis in fact or in law—none at all.” Section 57.l05(1)(b) would apply as a vehicle to sanction McCoy if such were true. Thus, the trial court violated principle five that it should rely on the statute rather than its inherent authority.

 

 

Miller’s Award of Attorney’s Fees and Costs Incurred Enforcing His Charging Lien

Here, Miller filed a motion for sanctions under section 57.105 more than thirty days after the trial court had already entered its final judgment. McCoy again argued that Miller had failed to comply with the twenty-one-day notice requirement. Again, the trial court elected to grant the motion which did not comply with the safe harbor provisions, by adopting the motion as a sanction “on its own initiative.”

 

Even if we were to agree with the Second District that there should be no blanket rule preventing a court from adopting a party’s untimely filed motion, under the facts here, the trial court clearly circumvented the statutory intent of the twenty-one-day notice. Here, the trial court never held a meaningful hearing regarding Miller’s 173–page motion. Instead, the trial court simply granted the motion and then permitted Miller’s counsel to write the order. The “court’s” order is almost verbatim from Miller’s motion. Under these facts, it seems unlikely that the trial court’s sanctions were on its own initiative.

 

The final order which Miller’s counsel wrote for the trial court states that it would “have been impossible” for Miller to give twenty-one days’ notice because “the defense kept shifting theories and adding additional baseless contentions.” In the same order, the trial court “found” that all of Dr. Santini’s defenses were baseless. These findings, however, are not in any way supported by competent and substantial evidence. If all of Dr. Santini’s defenses were baseless, Miller could have filed a section 57.105 motion at the beginning of the proceedings demanding that Dr. Santini withdraw her objections. Thus, under these circumstances, the failure *39 to provide the twenty-one-day safe harbor requires that this order be reversed.

 

Furthermore, the trial court abused its discretion in that it was required to permit Dr. Santini and McCoy an evidentiary hearing with respect to a finding of bad faith—whether the sanctions were issued under the trial court’s inherent authority or on its own initiative under section 57.105. See Moakley, 826 So.2d at 227; Ferdie, 8 So.3d at 1250. Nor did the trial court base its finding of bad faith conduct on “a high degree of specificity in the factual findings.”19 See Moakley, 826 So.2d at 227.

 

[20] [21] In what is perhaps the most egregious of all the trial court’s errors in this case, the trial court signed an eighteen-page order submitted by Miller’s counsel granting Miller’s motion for attorney’s fees and costs without first giving McCoy an opportunity to review the order. “A court should never direct only one side to prepare an order without assuring that the opposing party has had the opportunity to comment or object to its contents, or prepare its own submission.” Ross v. Botha, 867 So.2d 567, 572 (Fla. 4th DCA 2004). In Ross, we also noted, “It is also difficult to believe, on such fact-intensive issues as presented here, that an attorney can be so omniscient as to the court’s findings that they could be entirely correct without a single edit where the court made no rulings in open court.” Id. The Florida Supreme Court, in approving Ross, wrote:

When the trial judge accepts verbatim a proposed final judgment submitted by one party without an opportunity for comments or objections by the other party, there is an appearance that the trial judge did not exercise his or her independent judgment in the case. This is especially true when the judge has made no findings or conclusions on the record that would form the basis for the party’s proposed final judgment. This type of proceeding is fair to neither the parties involved in a particular case nor our judicial system.

Perlow v. Berg–Perlow, 875 So.2d 383, 390 (Fla.2004) (footnote omitted). The supreme court then held that “[w]hile a trial judge may request a proposed final judgment from either or both parties, the opposing party must be given an opportunity to comment or object prior to entry of an order by the court.Id. (emphasis added).

 

The order here was eighteen pages and the trial court accepted it with almost no changes. Miller’s counsel submitted the order to the trial court on the same day she submitted it to Dr. Santini’s counsel. Immediately upon receiving the proposed order, McCoy filed a motion objecting to *40 entry of the proposed order and requesting thirty days to respond and prepare an alternate proposed order. The trial court entered the unedited order without ruling on Dr. Santini’s motion. Dr. Santini then filed a motion for rehearing, which the trial court denied as well. On this basis alone, we could reverse the order as the trial court abused its discretion by not exercising independent judgment.

 

Clearly, the trial court lacked competent substantial evidence to support a finding that Dr. Santini and her counsel litigated in bad faith as the trial court never held any evidentiary hearings on bad faith. See Ferdie, 8 So.3d at 1250 (“A trial court’s decision under section 57.105(1) must be supported by competent substantial evidence; therefore, it follows that a full evidentiary hearing on the good faith issue is necessary.”).

 

The trial court also erred in finding that Dr. Santini and McCoy advanced baseless arguments. In its order granting Miller’s motion for attorney’s fees and costs, the trial court wrote (or at least approved Miller’s counsel’s written order stating): “[Dr. Santini] had no legitimate defenses, no legitimate legal theories on which to support any defense, and no legitimate material facts, disputed or otherwise, on which to base any defense.” This is plainly contradicted by the trial court’s own final ruling on costs and fees where Miller’s initial claims were reduced by $62,000. Furthermore, as we have previously explained, most of Dr. Santini’s defenses were substantially meritorious.

 

 

AWARD OF APPELLATE ATTORNEY’S FEES TO APPELLANTS

[22] Despite being given multiple opportunities to ethically concede error including a spirited oral argument session scheduled by this court on its own motion, Miller has callously proceeded in blatant bad faith.

 

As such, we have determined that this is one of those “rare circumstances” in which we should impose sanctions against an appellee and sua sponte award appellate attorney’s fees to the appellants in this case. See Boca Burger, Inc. v. Forum, 912 So.2d 561, 570 (Fla.2005).

 

In Boca Burger, the Florida Supreme Court held that “an appellate court may, in appropriate circumstances, impose sanctions on an appellee or its lawyer for its frivolous defense of a patently erroneous trial court order.” Id. at 563. The supreme court warned that although an appellee may be defending an order of a trial court, “an appellee cannot hide behind the ‘presumption of correctness’ of an order that the appellee itself procured by misrepresenting the law or the facts. The presumption of correctness is necessarily based on another presumption: that the appellee correctly informed the trial court of the facts and applicable law.” Id. at 571. In explaining that appellate counsel must sometimes concede error on appeal, the supreme court wrote:

[A]ppellate counsel … has an independent ethical obligation to present both the facts and the applicable law accurately and forthrightly. This will sometimes require appellate counsel to concede error where, although trial counsel obtained a favorable result, either the facts were not as represented to the trial court or the law is clearly contrary to the appellee’s position and no good-faith basis exists to argue that it should be changed.

Id. at 571 (emphasis added).

 

Appellants have correctly raised at least fifteen reversible errors that are strewn over the trial court’s three orders. Yet, Miller and his counsel have not conceded *41 even a single one. To add flagrant insult to injury, not only has Miller not conceded a single error, but, in almost surreal fashion, has actually filed a motion for sanctions in this court against Dr. Santini and McCoy alleging that all of their “arguments on appeal are completely unsupported by the material facts necessary to establish the defenses asserted and have no support in the law.”

 

To the contrary, there are a good number of “patently erroneous” errors contained in the lower court’s final orders, at least some of which Miller and his attorney had an ethical duty to concede both below and now before us.

 

Although the appellants have not specifically requested this relief, we have sua sponte imposed appellate attorney’s fee awards in the past, and we have specially warned that “there is no reluctance whatsoever by this court in approving, or even sua sponte imposing attorney’s fee awards under section 57.105 in appropriate cases.” Brockway v. Town of Golfview, 675 So.2d 699, 700 (Fla. 4th DCA 1996) (emphasis added). Accordingly, we remand this issue to the trial court to properly assess Dr. Santini’s and McCoy’s reasonable attorney’s fees for this appeal and thereafter impose such an award upon Miller. While we are extraordinarily tempted to extend this sanction to Miller’s lawyer, we choose to exercise restraint in that regard and therefore decline to do so.

 

[23] While this court cannot sanction Miller or his counsel for any actions that occurred in the trial court, on remand the trial court is directed to consider sanctions against Miller and his attorney. See Boca Burger, 912 So.2d at 569. Also, on remand, Dr. Santini and McCoy would be free, after serving Miller with twenty-one-day notice, to file a section 57.105 motion in the trial court. If the trial court were to deny such a motion, this court would be able to review that decision for abuse of discretion.

 

 

CONCLUSION

For the reasons stated above, Miller forfeited all of his rights to receive compensation from Dr. Santini. As such, we reverse the final order on Miller’s motion to enforce his charging lien and remand for the trial court to vacate the charging lien altogether. We also reverse the trial court’s awards of sanctions against both McCoy, individually, and Dr. Santini and McCoy jointly. Finally, we sua sponte award appellate attorney’s fees to Dr. Santini and McCoy. On remand, the trial court shall determine the reasonable amount of these fees.

 

Reversed and remanded for further proceedings consistent with this opinion.

 

POLEN, HAZOURI and CIKLIN, JJ., concur.

All Citations

65 So.3d 22, 36 Fla. L. Weekly D1011

 

 

Footnotes

 

1

 

The federal court found that Miller’s time records reflected his receipt and review of the undated first notice on February 2, 1998, as did a memorandum in which Miller directed an associate to draft the complaint in Dr. Santini’s case. The federal court found that Miller “breached his duty of candor to this tribunal. He deliberately structured his memorandum, affidavits, and witness testimony to create a false impression with the Court.”

 

2

 

Dr. Santini’s case was dismissed by the state (circuit) court in 2001 and an appeal was subsequently taken to this court. We reversed the dismissal and remanded the case to the trial court on May 7, 2003. See Santini v. Cleveland Clinic Fla., 843 So.2d 1029 (Fla. 4th DCA 2003). We also awarded Dr. Santini her appellate attorney’s fees for that appeal.

 

3

 

The fee sharing agreement entered into between Miller and Senior was never signed or in any way acknowledged by Dr. Santini.

 

4

 

Prior to the hearings in the charging lien matter, Dr. Santini had already reached an agreement with Senior to pay him $92,350 including costs for his work on the case.

 

5

 

In announcing its decision to impose sanctions, the trial court stated, “I’m not sure about the other case law on inherent authority. But if that’s true, on both grounds.”

 

6

 

Most of the one-hour hearing was actually spent on Miller’s proposed order for an award under the court’s ore tenus ruling sanctioning McCoy at the September 26, 2007 hearing.

 

7

 

The trial court’s full response was:

All right. I’m going to be succinct. I think for the Fourth District, the terminology that would be the best going forward is res ipsa loquitur.

All I would ask the Fourth District to do on the appeal of this case is to read all the transcripts. Read them. I think it will answer any question that might arise with respect to how this Court came to its rulings.

 

8

 

Rule 4–1.5(f)(2) of the Rules Regulating The Florida Bar reads in pertinent part:

Every lawyer who … enters into an agreement … for compensation for services … whereby the lawyer’s compensation is to be dependent or contingent … upon the successful prosecution or settlement thereof shall do so only where such fee arrangement is reduced to a written contract, signed by the client, and by a lawyer for the lawyer or for the law firm representing the client. No lawyer or firm may participate in the fee without the consent of the client in writing.

 

9

 

Miller conceded at trial (and concedes in his answer brief) that he had always represented to Dr. Santini that he was representing her on a contingency fee basis.

 

10

 

In Chandris, the Florida Supreme Court was asked to answer two certified questions of law from the United States Court of Appeals for the Eleventh Circuit. 668 So.2d at 181. One question was whether a contingency fee agreement entered into in Florida by an out-of-state attorney who resides in Florida but was not licensed to practice law in Florida was void. Id. The second question was if the court determined the first agreement void, whether a subsequent agreement entered into by a Florida law firm based on the void agreement was also void. Id. Thus, to answer the certified questions, it was unnecessary for the Florida Supreme Court to reach a decision regarding whether unrelated violations of the Rules Regulating The Florida Bar would make contingency fee agreements void. As such, the statement could be read as dicta.

 

11

 

In Lackey v. Bridgestone/Firestone, Inc., 855 So.2d 1186, 1188 (Fla. 3d DCA 2003), the Third District allowed an attorney to recover under a contingency fee contract which contained some provisions that the court found violated the Rules Regulating The Florida Bar. The Third District wrote, “We will not hold that the inclusion of the unenforceable terms voids the entire contract.” Id. Although this is in conflict with a literal reading of the Florida Supreme Court’s statement that any contingency fee agreement which does not comply with the Rules Regulating The Florida Bar is void, the Florida Supreme Court denied review of this decision. Lackey v. Bridgestone/Firestone, Inc., 870 So.2d 822 (Fla.2004); see also Corvette Shop & Supplies, Inc. v. Coggins, 779 So.2d 529, 531 (Fla. 2d DCA 2000) (“While we recognize that strict compliance with the rule is always prudent, we nevertheless conclude that the rule is intended to protect the client ….”) (emphasis added).

 

12

 

Even if we were to find that a forfeiture of fees was not warranted in this scenario, at best, an attorney who withdraws due to a professional association suspension should be treated no better than an attorney who is discharged for cause. See Scheller, 629 So.2d at 954. In such a case, Miller’s maximum recovery would be $113,150. This is based on a contingency fee of 45% of $457,000 (settlement amount minus costs) less the amount ($92,500) that Dr. Santini had to pay Senior to represent her after Miller’s suspension. Since the original contract was unclear as to whether costs are subtracted first before computing the contingency, the fee should be based on a percentage of net recovery only.

 

13

 

Although this is by no means a complete list of additional trial court errors, these are some of the most obtrusive.

 

14

 

Admittedly, in this case Miller was not “discharged without cause.” At the very least, however, the Poletz holding sets the maximum fee that Miller could possibly recover.

 

15

 

Of course, if the trial court recognized the existence of the contingency fee agreement, the trial court should also have limited Miller’s recovery, even in quantum meruit, to the maximum contract amount. See Rosenberg, 409 So.2d at 1021. We also note that if the trial court were basing the prejudgment interest on the “agreement” of the parties, then interest would not accrue until Dr. Santini actually received the proceeds (sometime after September 26, 2007). See McCarthy, 16 So.3d at 195 (holding that where an agreement between a client and an attorney makes payment contingent on the proceeds of recovery, prejudgment interest is calculated from date the client actually receives the proceeds).

 

16

 

We note that this was the appropriate forum to file such a motion. See Daniel Mones, P.A. v. Smith, 486 So.2d 559, 561 (Fla.1986) (“A summary proceeding in the original action represents the preferred method of enforcing an attorney’s charging lien in Florida.”).

 

17

 

Fortunately, we do not have to review whether there is substantial competent evidence to support the trial court’s finding here. We do note, however, that the trial court’s contention of buyer’s remorse seems to conflict with the “twenty-one-day” clause in the written agreement.

 

18

 

In his motion, McCoy attached an affidavit from Kevin Tynan, an attorney who had worked for twelve years for The Florida Bar on disciplinary issues. Tynan stated, “It is my expert opinion that based upon all of the foregoing that McCoy’s assertion that the settlement was not final was made in good faith, in reliance to known facts that do not appear to be controverted, and with the belief that precedent supported this claim.”

 

19

 

During a hearing on January 29, 2009, McCoy unequivocally asked the trial court for an evidentiary hearing:

But all I can suggest is, that if fundamental fairness comes into play here and due process, is if Your Honor feels that some sanctions, additional to what you’ve given me already, are warranted and the reasons are apparent to you from Miller’s motion—I don’t think they are—I would just ask for the due process of a Show Cause Order or something of that nature so that we can have an evidentiary hearing and I can actually defend myself and my client.

The trial court’s eventual answer to McCoy’s request was:

All right. I’m going to be succinct. I think for the Fourth District, the terminology that would be the best going forward is res ipsa loquitur.

All I would ask the Fourth District to do on the appeal of this case is to read all the transcripts. Read them. I think it will answer any question that might arise with respect to how this Court came to its rulings.

 

 

 

 

 

 

End of Document

 

© 2016 Thomson Reuters. No claim to original U.S. Government Works.

 

 

 

 

 

 

 

783 So.2d 1160

District Court of Appeal of Florida,

Third District.

FRANK J. PEPPER, INC., a Florida corporation, and Frank J. Pepper, Jr., Appellants,

v.

Edward C. VINING, Jr., Appellee.

No. 3D00-1628.

|

April 18, 2001.

|

Rehearing Denied May 16, 2001.

Attorney who withdrew from representation when he was suspended from practicing law while defending client in civil action, sued to collect attorney fees. Following trial before General Master, the Circuit Court for Dade County, Jon I. Gordon, J., entered judgment against client in the amount of $17,000. Client appealed and attorney cross-appealed. The District Court of Appeal held that: (1) attorney’s fee expert was properly struck; (2) award of attorney fees was supported by testimony of client’s fee expert; and (3) undisputed evidence supported award of no more than $11,000.

 

Affirmed in part, reversed in part, and remanded with instructions.

 

 

 

West Headnotes (3)

 

 

[1]

 

Attorney and Client

Premature Termination of Relation

 

 Totality of the circumstances test for determining quantum meruit recovery, rather than lodestar approach, should have been used to calculate attorney fees, where the attorney withdrew from representation prior to resolution of client’s case when he was suspended from the practice of law.

3 Cases that cite this headnote

 

 

 

[2]

 

Costs

Evidence as to Items

 

 Award of attorney fees must be supported with expert testimony.

Cases that cite this headnote

 

 

 

[3]

 

Attorney and Client

Evidence

 

 Though attorney’s own expert witness was struck, fee award was supported by testimony of client’s witness.

Cases that cite this headnote

 

 

 

Attorneys and Law Firms

*1161 Sacher, Zelman, Van Sant, Paul, Beiley, Hartman & Waldman and Glen H. Waldman, Miami, for appellants.

Edward C. Vining, Jr., in proper person.

Before LEVY, GREEN, and RAMIREZ, JJ.

Opinion

PER CURIAM.

 

This is an appeal and cross-appeal from a Final Judgment, and several related Orders, awarding attorney fees to Edward Vining, Jr. (“Vining”) for legal services rendered to Frank J Pepper, Inc. and Frank J. Pepper, Jr. (collectively, “Pepper”). Pepper contends that the fee award to Vining was error, or alternatively, that the fee award was excessive. On cross-appeal, Vining contends that the fee award was insufficient and that the trial court erred in striking Vining’s fees expert witness. We reverse in part and affirm in part.

 

Vining, an attorney, and Pepper, a real estate businessman, were office neighbors for a number of years. In 1996, Pepper was sued for unpaid real estate commissions (the Campbell suit) and after an informal conversation, Vining began responding to and defending the claims against Pepper. No written contract was executed between the parties for Pepper’s representation. In 1998, Vining was suspended from the practice of law and withdrew from the representation of Pepper’s case. As a result, Pepper hired another attorney, Burt Redlus, to represent him in the Campbell suit and paid him a $5,000 retainer fee. Vining subsequently presented Pepper with a $25,000 summary bill for his services. After not receiving payment from Pepper, Vining instituted the instant suit against Pepper seeking $42,402.50 in attorney’s fees plus costs, claiming Breach of Contract, Quantum Meruit, and/or Unjust Enrichment. The case was referred to a General Master for trial.

 

After trial, the General Master found that there was no oral agreement between the parties and accordingly entered judgment for Pepper on the Breach of Contract claim. However, the General Master found that Vining was entitled to fees based on either his Quantum Meruit or Unjust Enrichment claims. Subsequently, the fee amount aspect was tried before the same General Master. Vining introduced his time records into evidence, as well as an attorney’s fee expert, Keith Merrill. At the end of Vining’s case, Pepper moved to *1162 strike Vining’s expert and for a Directed Verdict as to the remaining claims. Pepper’s Motion to Strike was predicated on the argument that Vining’s expert improperly based his fee opinion on the lodestar method set out in Florida Patient’s Compensation Fund v. Rowe, 472 So.2d 1145 (Fla.1985)1, as opposed to the totality of the circumstances method required in Searcy, Denney, Scarola, Barnhart & Shipley, P.A. v. Poletz, 652 So.2d 366 (Fla.1995). The Directed Verdict was based on the contention that if the expert’s testimony was struck, Vining could not meet his evidentiary burden. The trial court reserved ruling on both motions. Consequently, Pepper moved forward with his case and introduced the testimony of his own fee expert who testified that a reasonable fee for Vining’s services was $11,000. Pepper’s expert also testified that the $5,000 retainer Pepper paid new counsel should be setoff. Accordingly, the expert opined, Vining should be awarded a $6,000 fee.

 

At the close of Pepper’s case, Pepper renewed the Motion to Strike and the Motion for Directed Verdict. The General Master struck Vining’s expert testimony finding that it was based on an improper predicate; that is to say, that Vining’s expert based his fee opinion on the Rowe lodestar approach. Additionally, the General Master entered a Directed Verdict as to the Quantum Meruit claim, thereby leaving only the Unjust Enrichment claim.

 

After viewing all the evidence, including Pepper’s fees expert witness testimony, the General Master recommended that Final Judgment be entered for Vining in an amount of $17,000. Accordingly, the trial court entered Final Judgment against Pepper for $17,000. Pepper appeals the Final Judgment. Vining cross-appeals the Final Judgment and the Order striking his fees expert witness. For the following reasons, we reverse the Final Judgment to the extent that it grants Vining $17,000 in fees, but affirm an actual award of fees and the denial of Pepper’s request for a set-off. Additionally, we affirm the Order striking Vining’s fee expert.

 

In Searcy, Denney, Scarola, Barnhart & Shipley, P.A. v. Poletz, 652 So.2d 366 (Fla.1995), the Supreme Court of Florida set out the proper criteria for determining the Quantum Meruit recovery of an attorney discharged without cause prior to resolution of the client’s case.2 Cf., Florida Patient’s Compensation Fund v. Rowe, 472 So.2d 1145 (Fla.1985); see also Rosenberg *1163 v. Levin, 409 So.2d 1016 (Fla.1982). Poletz recognized that the Rowe /lodestar method is “ill-suited” for assessing attorney’s fees as a result of a breach of an agreement for fees because “it does not allow for consideration of ‘the totality of the circumstances surrounding the professional relationship.’ ” Poletz, 652 So.2d at 368-69. Under the Poletz standard, the court must consider several factors in determining a quantum meruit award, taking into account the value of the services to the client. The Poletz Court recognized that the time reasonably devoted to the representation and a reasonable hourly rate, are factors to consider when determining a proper award. Additionally, the Court recognized that several other factors provide guidance in determining a reasonable fee, including the time and labor required, the novelty, complexity and difficulty of the issues involved, the likelihood that acceptance of the case will preclude other employment, the customary rate charged in the locality, the significance of or amount involved in the representation and result obtained, special demands or time limitations, the nature and length of the professional relationship with the client, the reputation and experience of the attorney, and whether the fee is fixed or contingent. See Poletz, 652 So.2d at 369 n. 4. In addition to these factors, which are akin to the Rowe factors, the court must “consider any other factors surrounding the professional relationship” including, the fee agreement, the reason the attorney withdrew or was discharged, actions taken by either party before or after the discharge, and the benefit conferred on the client. See Poletz, 652 So.2d at 369.

 

[1] In the instant case, the trial court struck Vining’s fees expert’s testimony on the basis that the criteria upon which he based his opinion was improper in light of Searcy, Denney, Scarola, Barnhart & Shipley, P.A. v. Poletz, 652 So.2d 366 (Fla.1995). As part of his case in chief, Vining advanced the testimony of Keith Merrill as his fees expert witness. During cross-examination, Merrill acknowledged that he used the Rowe /lodestar approach as a basis for his fee opinion. Having reviewed the Record on appeal, we find that Merrill’s opinion was properly stricken as he failed to consider the factors enunciated in Poletz .

 

[2] [3] Pepper’s next argument is based on the well-settled point that a fee award must be supported with expert testimony. See Brake v. Murphy, 736 So.2d 745 (Fla. 3d DCA 1999); Yakubik v. Board of County Commissioners of Lee County, 656 So.2d 591 (Fla. 2d DCA 1995). Pepper argues that without the expert’s testimony Vining cannot meet his evidentiary burden and accordingly, any fee award to Vining is improper. We recognize that expert testimony is necessary for a fee award. However, in the instant case, although Vining’s expert witness was properly struck, the trial court could still consider the testimony of Pepper’s expert in assessing a fee award in favor of Vining. See 6551 Collins Avenue Corp. v. Millen, 104 So.2d 337, 342 (Fla.1958) (holding that when a defendant proceeds with the presentation of his evidence after a trial judge reserves ruling on a defense Motion for Directed Verdict at the close of the plaintiff’s case, the court’s ruling on the renewed motion must be based on a consideration of all the evidence presented.); see also Gulf Heating & Refrigeration Co. v. Iowa Mutual Ins. Co., 193 So.2d 4 (Fla.1966). Upon returning to the reserved Motion for Directed Verdict and Motion to Strike, because Pepper presented a defense, the trial court was able to consider all the evidence presented in the case by both parties, including Pepper’s own fees expert. See Millen, 104 So.2d at 342. In the instant case, *1164 Pepper’s expert testified that a reasonable fee would be $11,000, less the $5,000 setoff, which said setoff the trial court ultimately found was not supported by the evidence presented by either party. Because the undisputed evidence in the record, specifically Pepper’s expert testimony, supports an award of fees to Vining of not more than $11,000, we reverse the amount awarded and find that $11,000 is a proper award.

 

Accordingly, we vacate the Final Judgment awarding $17,000 to Vining and remand this cause to the trial court with directions to enter Final Judgment in favor of Vining in the amount of $11,000. In view of the foregoing, we deem Vining’s cross-appeal, relating to the insufficiency of the fees and the striking of the expert opinion, moot.

 

Affirmed in part; reversed in part; and remanded with instructions.

 

All Citations

783 So.2d 1160, 26 Fla. L. Weekly D1028

 

 

Footnotes

 

1

 

Rowe ‘s lodestar approach requires that the court: (1) determine the number of hours reasonably expended on the litigation; and (2) determine a reasonable hourly rate for the services of the prevailing party’s attorney. In analyzing this step, the court is required to consider: (a) the time and labor required, the novelty and difficulty of the issue, the results obtained, the market rate and whether the fee is fixed or contingent. By taking the number of hours expended determined in the first part and multiplying it by the reasonable hourly rate determined in the second step, the lodestar is produced. Thereafter, the court may increase or reduce the fee based upon a “contingency risk factor” and the result that is obtained. See Rowe, 472 So.2d at 1150-52. Rowe further requires that the court set forth specific findings and state the grounds which justify any enhancement or reduction to the lodestar. Id.

 

2

 

The Poletz criteria has been extended to apply where a firm or attorney is: discharged prior to completion of the representation Law Offices of Theodore Goldberg v. Fazio, Dawson, DiSalvo, Cannon, Abers & Podrecca, 659 So.2d 1200 (Fla. 3d DCA 1995); discharged for cause Kushner v. Engelberg, Cantor & Leone, P.A., 750 So.2d 33 (Fla. 4th DCA 1999); and where the attorney withdraws without any fault of the client before completion of the case Faro v. Romani, 629 So.2d 872 (Fla. 4th DCA 1993)quashed on other grounds, 641 So.2d 69 (Fla.1994)(approved in Poletz ).

 

 

 

 

 

 

End of Document

 

© 2016 Thomson Reuters. No claim to original U.S. Government Works.

 

 

 

 

 

 

 

 

KeyCite Yellow Flag – Negative Treatment

519 Fed.Appx. 657

This case was not selected for publication in West’s Federal Reporter.

See Fed. Rule of Appellate Procedure 32.1 generally governing citation of judicial decisions issued on or after Jan. 1, 2007. See also U.S. Ct. of App. 11th Cir. Rule 36-2.

United States Court of Appeals,

Eleventh Circuit.

BUCKLEY TOWERS CONDOMINIUM, INC., Plaintiff–Appellee,

Rosenbaum Mollengarden Janssen & Siracusa PLLC, Interested Party–Appellee,

v.

KATZMAN GARFINKEL ROSENBAUM, LLP, Interested Party–Appellant.

No. 12–12039.

|

May 20, 2013.

Synopsis

Background: After insured condominium owner recovered from insurer in suit on hurricane insurance policy, law firms that had represented insured at different times during litigation on contingency fee basis moved to enforce their charging liens. The United States District Court for the Southern District of Florida, No. 1:07–cv–22988–RWG, affirmed and adopted recommendation of magistrate, 2012 WL 573784, and awarded firm that had represented insured at appellate argument contingency fee less quantum meruit award for firm that had represented insured when litigation was initiated and quantum meruit award for firm that had represented insured during trial and appellate briefing and awarded quantum meruit fees to the other two firms. Firms awarded quantum meruit fees appealed, and firm that had initiated litigation settled its fee dispute and dismissed its appeal.

 

Holdings: On remaining appeal, the Court of Appeals held that:

 

[1] under Florida law, law firm corporation’s right to contingency fees earned after attorney-client contract was terminated and counsel replaced was to entire contingency fee less former shareholder’s share if shareholder exited initial firm and client followed shareholder to new firm;

 

[2] under Florida law, law firm corporation’s agreement purporting to address distribution of fees when shareholder withdrew from firm that was embedded in covenant not to compete was inconsistent with professional responsibility rule barring covenants that restricted attorneys’ right to practice and did not control distribution of total fee award to client represented by the shareholder before and after he moved to other firms;

 

[3] under Florida law, shareholder who had exited law firm corporation during litigation and took client with him to second firm had duty to wind up initial firm’s business, but other attorneys at second firm had no fiduciary duties to wind up corporation’s affairs, and so second firm was entitled to quantum meruit award of fees for work done; and

 

[4] under Florida law, awarding second firm quantum meruit award based on fees insurer was ordered to pay client-insured was abuse of discretion.

 

Reversed and remanded.

 

 

 

West Headnotes (6)

 

 

[1]

 

Attorney and Client

Attorneys;  associates

Attorney and Client

Under contract for contingent fee

 

 Under Florida law, law firm partnership’s right to contingency fees earned after attorney-client contract was terminated and counsel replaced was to quantum meruit award limited by maximum fee award if the two firms were not connected or if associate attorney at first firm exited firm and client followed associate to new firm, but if partner exited initial firm and client followed partner to new firm, initial firm was entitled to entire contingency fee less former partner’s partnership share.

2 Cases that cite this headnote

 

 

 

[2]

 

Attorney and Client

Corporations

Attorney and Client

Under contract for contingent fee

 

 Under Florida law, law firm corporation’s right to contingency fees earned after attorney-client contract was terminated and counsel replaced was to quantum meruit award limited by maximum fee award if the two firms were not connected or if associate attorney at first firm exited firm and client followed associate to new firm, but if shareholder exited initial firm and client followed shareholder to new firm, initial firm was entitled to entire contingency fee less former shareholder’s share.

1 Cases that cite this headnote

 

 

 

[3]

 

Attorney and Client

Corporations

 

 Under Florida law, law firm corporation’s agreement purporting to address distribution of fees when shareholder withdrew from firm that was embedded in covenant not to compete and required shareholder who breached that covenant and continued ongoing matter to compensate firm the greater of 50% of fee received or firm’s quantum meruit was inconsistent with professional responsibility rule barring covenants that restricted attorneys’ right to practice and did not control distribution of total fee award to client represented by the shareholder before and after he moved to other firms in determining validity and value of charging liens asserted by multiple firms; three firms had contingency fee agreements with client who owned condominiums and recovered from insurer in suit on hurricane insurance policy. West’s F.S.A. Bar Rules 4–5.6, 4–5.6 comment.

Cases that cite this headnote

 

 

 

[4]

 

Attorney and Client

Corporations

Attorney and Client

Contracts for division, and apportionment

 

 Under Florida law, shareholder who had exited law firm corporation during litigation and took client with him to new firm had duty to wind up initial firm’s business, but other attorneys at new firm had no fiduciary duties to wind up corporation’s affairs, and so when client entered into contingency fee agreements with initial corporation, second partnership and third firm to which attorney moved, taking client with him again, and contingency completed during attorney’s work at third firm, second firm was entitled to quantum meruit award of fees for work done, not merely to share in attorney’s share of fees to which he was entitled when he wound up first firm’s business by resolving litigation of client who owned condominiums and recovered from insurer in suit on hurricane insurance policy.

Cases that cite this headnote

 

 

 

[5]

 

Attorney and Client

Premature Termination of Relation

Attorney and Client

Contracts for division, and apportionment

 

 Under Florida law, awarding law firm that represented client who owned condominiums and recovered from insurer in suit on hurricane insurance policy quantum meruit award based on fees insurer was ordered to pay client-insured for firm’s work on matter was abuse of discretion in litigation in which multiple firms that had represented client-insured asserted charging liens; that fee award did not account for benefit conferred on client-insured or other factors applicable in determining quantum meruit fee due attorney from client and also did not account for benefit conferred from firm’s work on post-trial matters and appellate briefing.

Cases that cite this headnote

 

 

 

[6]

 

Attorney and Client

Under contract for contingent fee

Attorney and Client

Contracts for division, and apportionment

 

 Under Florida law, any monies remaining in court registry that were deposited to cover charging liens asserted by three law firms should be returned to client, after charging liens in amount of quantum meruit due second firm and shareholder attorney’s equity share due under his agreement with first firm were compensated; firms successively represented client under contingency fee agreements as client followed shareholder attorney to second firm and then to third firm, shareholder attorney was obligated to wind up business that was ongoing from first firm, so third firm was not entitled to benefit of contingency fee agreement, and first firm had settled its claim for fees due from client-insured’s recovery in suit against insurer on hurricane insurance policy.

Cases that cite this headnote

 

 

 

Attorneys and Law Firms

*659 Keith Jeffrey Lambdin, Katzman Garfinkel & Berger, Margate, FL, for Plaintiff–Appellee.

Daniel S. Rosenbaum, John M. Siracusa, Laurel R. Wiley, Rosenbaum Mollengarden, PLLC, West Palm Beach, FL, for Interested Party–Appellee.

John F. Mariani, Shutts & Bowen, LLP, West Palm Beach, FL, for Interested Party–Appellant.

Appeals from the United States District Court for the Southern District of Florida. D.C. Docket No. 1:07–cv–22988–RWG.

Before DUBINA, Chief Judge, BARKETT and FAY, Circuit Judges.

Opinion

PER CURIAM:

 

**1 This case involves the distribution of a contingency fee among law firms when an equity-holding attorney changes law firms multiple times during the course of litigating a single matter and the client follows the exiting attorney to each new firm. Appellant Katzman Garfinkel Rosenbaum, LLP (“KGR”), appeals the district court’s adoption of the magistrate’s Report and Recommendation granting in part and denying in part KGR’s motion to enforce a charging lien for professional services rendered, limiting the value of KGR’s lien to $894,897.1 KGR presents several arguments on appeal for how the court erred in undervaluing its lien, including that the district court failed to properly apply Florida case law—specifically Frates v. Nichols, 167 So.2d 77 (Fla. 3d DCA 1964). After reviewing the briefs and with the benefit of oral argument, we agree that Frates governs this matter, but disagree with KGR’s suggested application of Frates.

 

 

  1. Background

The underlying claim began when Buckley Towers Condominium, Inc. (“Buckley”), suffered significant damage during Hurricane Wilma in October 2005. Buckley’s insurer, QBE Insurance Corp. (“QBE”), refused payments on the claim and, for assistance, Buckley turned to its longtime counsel, Becker & Poliakoff, P.A. (“B & P”). In October 2007, Buckley retained B & P on an hourly fee basis, and B & P filed the underlying complaint in November 2007. On April 17, 2008, B & P and Buckley changed their fee arrangement and B & P agreed to represent Buckley on a contingency fee basis. Attorney Daniel Rosenbaum—an equity shareholder at B & P—led the litigation team that handled the Buckley litigation.

 

On August 4, 2008, Rosenbaum left B & P to form the new firm Katzman, Garfinkel & Rosenbaum, LLP (“KGR”). Buckley followed Rosenbaum, signing a contingency fee agreement with KGR on August 26, 2008, and B & P then filed a notice of a charging lien with the district court. KGR completed the remaining pre-trial proceedings and represented Buckley through a 10–day jury trial. On May 14, 2009, the district court entered a final judgment of over $24 million in Buckley’s favor. QBE *660 appealed the final judgment and KGR remained counsel through briefing on the appeal.

 

In March 2010, Rosenbaum again switched firms, leaving KGR to form Rosenbaum, Mollengarden, Janssen & Siracusa, PLLC (“RMJS”). Again, Buckley followed Rosenbaum to the new firm, signing a contingency fee agreement with RMJS on April 12, 2010. RMJS represented Buckley at oral argument. On December 12, 2010, this Court affirmed in part and vacated in part the final judgment, affirming the actual cost value damages of over $11 million.

 

On Buckley’s motion, the district court entered a partial amended final judgment2 in the amount of $12,035,449 on March 28, 2011. Thereafter, KGR filed its notice of a charging lien, and the court ordered the disputed funds be deposited in the court’s registry. QBE issued two checks, one to Buckley and the other to the court’s registry to cover the amount contested by the attorneys’ charging liens. Prior to Buckley endorsing QBE’s check, Buckley terminated its relationship with RMJS and RMJS filed its notice of a charging lien.

 

**2 More relevant to the issues before this Court, B & P, KGR, and RMJS all moved to enforce their charging liens. After reviewing the law firms’ motions, responses, replies, supplemental filings, and exhibits on the record, as well as holding a hearing on the matter, the magistrate issued a Report and Recommendation (“R & R”). The magistrate recommended that the court exercise its ancillary jurisdiction and found that RMJS should receive its 38.5% contingency fee from the partial final judgment, less the quantum meruit of B & P and KGR.3 In determining the quantum meruit award for B & P and KGR, the magistrate first looked to the fees awarded in Buckley’s previously granted motion for attorneys’ fees. The magistrate found those fees adequately compensated the law firms for the actual value of their services and recommended KGR receive $894,897.00 and B & P receive $681,063.00 in fees. The magistrate valued the total fee award at $4,633,646.86; thus, RMJS was awarded $3,057,687.88. The district court affirmed and adopted the R & R in its entirety.

 

Both KGR and B & P appealed the fee award; however, B & P dismissed its appeal after settling its dispute for $1.3 million.4 On appeal, KGR argues the district court failed to properly apply Florida law and erred in its distribution of the fees.

 

 

  1. Standard of Review

“The charging lien is an equitable right to have costs and fees due an attorney for services in the suit secured to him in the judgment or recovery in that particular suit.” Sinclair, Louis, Siegel, Heath, Nussbaum & Zavertnik, P.A. v. Baucom, 428 So.2d 1383, 1384 (Fla.1983). However, a charging lien is contractual in nature and in order for a charging lien to be imposed, there must be a contract between the attorney and client. See, e.g., id. at 1385. This Court “reviews a trial court’s award of attorneys’ fees for abuse of discretion. *661 However, a trial court’s interpretation of a contract is a matter of law subject to a de novo standard of review.” US Acquisition, LLC v. Tabas, Freedman, Soloff, Miller & Brown, P.A., 87 So.3d 1229, 1234 (Fla. 4th DCA 2012) (internal quotation and citations omitted).

 

 

III. Analysis

When a party substitutes counsel of record in the midst of litigation, the initial counsel of record is generally entitled to the fees earned during its period of representation. When the initial counsel of record agrees to take the case on a contingency fee basis, the determination of the fees earned becomes more complicated. Calculating the fees earned becomes even more complex when the new counsel of record has broken away from the initial counsel of record and the client chooses to follow the exiting attorney to the new firm. In the instant matter, we are presented with the unique situation of the client choosing to follow an attorney that twice exited the firm representing the client in the midst of litigation. To still further complicate the matter, the exiting attorney held an equity share in both of the firms that he exited.

 

 

A.

**3 [1] The law in Florida relating to a firm’s right to contingency fees earned after the attorney-client contract is terminated varies depending on the relationship between the initial firm and the subsequent firm representing the client. When there is no connection between the two firms, the initial firm is entitled to a quantum meruit award, limited by any agreement to a maximum fee award. See, e.g., Rosenberg v. Levin, 409 So.2d 1016, 1021 (Fla.1982) (holding “an attorney employed under a valid contract who is discharged without cause before the contingency has occurred … can recover only the reasonable value of his services rendered prior to discharge, limited by the maximum contract fee.”). When an associate attorney at the initial firm exits the firm and the client follows the associate to a new firm, the initial firm is also entitled to this limited quantum meruit award. See, e.g., Searcy, Denney, Scarola, Barnhart & Shipley, P.A. v. Poletz, 652 So.2d 366, 368–69 (Fla.1995) (relying on Rosenberg to determine that a simple lodestar calculation is insufficient in determining the initial firm’s quantum meruit award). However, when a partner exits the initial firm and the client follows, the initial firm is entitled to the entire contingency fee, less the former partner’s partnership share. Frates, 167 So.2d at 82 (holding fees were assets of the initial firm and the former partner is only “entitled to receive his partnership share … of the net fee in each such case.”).

 

RMJS questions the present applicability of Frates, referring to the case as an outdated ruling. Yet, RMJS fails to cite to any case law in support of this proposition, relying instead on the Revised Uniform Partnership Act (“RUPA”) and Florida Rules of Professional Responsibility. This Court finds no case law overturning the Frates decision, and does not find that Florida’s adoption of RUPA significantly affects the precedent set forth in Frates.

 

In Frates, the court was faced with a situation where a partner in a law firm exited the firm and took with him ten ongoing negligence cases of clients of the former firm, eight of which resulted in fees. Id. at 79. Finding that the partnership agreement failed to provide for the situation of a withdrawing partner completing some of the pending cases, the court looked to common law and partnership law principles to determine the matter. Id. at 81–82. One of the tenets of partnership law relied on by the court is that “a law partner in dissolution owes a *662 duty to his old firm to wind up the old firm’s pending business, and that he is not entitled to any extra compensation therefor.” Id. at 80 (footnote omitted). The court held that the “cases were assets of the old firm being wound up by [the withdrawing partner] for them….” Id. at 82 (footnote omitted). Thus, the withdrawing partner was entitled to his partnership share of the fees and the remaining fees were owed to the firm. Id.

 

**4 Effective in 1996, Florida’s legislature amended the state’s partnership law to adopt a substantial portion of RUPA. See Fla. Stat. § 620.81001, et seq.; Larmoyeux v. Montgomery, 963 So.2d 813, 819 (Fla. 4th DCA 2007). A key change introduced by RUPA is that partnerships are not automatically dissolved when a partner withdraws. See Fla. Stat. § 620.8601(1); Unif. P’Ship Act § 601, cmt. 1 (1997);5 Larmoyeux, 963 So.2d at 819. Further, under RUPA, partners are “not entitled to remuneration for services performed for the partnership, except for reasonable compensation for services rendered in winding up the business of the partnership.” Fla. Stat. § 620.8401(8) (emphasis added). Importantly, the uniform comments state “[t]he exception is not intended to apply in the hypothetical winding up that takes place if there is a buyout under Article 7.” Unif. P’Ship Act § 401, cmt. 9 (1997). Finally, under RUPA, upon a partner’s dissociation, the partner’s duties of loyalty and care “continue only with regard to matters arising and events occurring before the partner’s dissociation….” Fla. Stat. § 620.8603(2)(c).6

 

While the adoption of RUPA made significant changes to the partnership law of Florida, we do not see that these changes detract from the premises of Frates. The commentary to RUPA makes clear that its enactment did not change the existing law as it relates to the fiduciary duties of a withdrawing partner. Moreover, RUPA still supports the premise that partners are not entitled to additional remuneration during a partner’s dissociation. In fact, the example provided in the uniform commentary clearly supports the continuation of the Frates rule by stating that dissociated partners must account to the partnership for any fees from ongoing client transactions that are received after dissociation. While it is clear that nothing in RUPA overturns the ruling in Frates, we must still determine if Frates is applicable or controlling in the present matter.

 

 

B.

[2] To resolve whether Frates applies to the present matter, we must determine if Frates applies equally to law firms that choose a professional corporation, as opposed to a partnership, as their business entity. This is because the initial law firm representing Buckley was B & P, a professional corporation. We do not believe Florida courts would allow attorneys to *663 shirk fiduciary duties simply by choosing an alternate business entity for their law firm.

 

When determining a lawyer’s fiduciary duties, Florida law generally does not distinguish between lawyers in partnerships and those in professional corporations. The Florida Rules of Professional Conduct do not distinguish between these business entities as to the applicability of responsibilities of partners as supervisory lawyers, Fla. R. Prof. Conduct 4–5.1, cmt., or the applicability of duties owed to clients and procedures for lawyers to exit law firms. Fla. R. Prof. Conduct 4–5.8. Moreover, the Florida Supreme Court has stated

**5 we approved the practice of law in a corporate form subject to the express recognition that under the common law, a lawyer who renders professional services owes a duty of care regardless of the fact that the lawyer is an associate or partner in a business entity that contracts to provide professional services to the injured party.

Moransais v. Heathman, 744 So.2d 973, 978 (Fla.1999), receded from on other grounds, Tiara Condo. Ass’n, Inc. v. Marsh & McLennan Cos., Inc., 110 So.3d 399 (Fla.Mar.7, 2013).

 

Further, the Second Circuit, applying a New York law similar to Frates, found the fiduciary duties owed by a partner withdrawing from a partnership applied equally to a shareholder withdrawing from a professional corporation. Santalucia v. Sebright Transp. Inc., 232 F.3d 293, 299 (2d Cir.2000). The Second Circuit determined that “the majority of states to confront this issue have extended the familiar fiduciary duty principles of partnerships to professional corporations.” Id. (collecting cases). As Florida courts do not differentiate between business entities as to fiduciary duties owed to clients and subordinates, we believe Florida courts would follow the majority of states and require the same fiduciary duties be owed to other attorneys and former law firms, whether the firm was a partnership or professional corporation. Thus, we will apply Frates equally to law firms formed as partnerships and those formed as professional corporations.

 

 

C.

[3] The Frates court applied the common law, but clearly indicated that law firms can change the fee award a withdrawing attorney is entitled to by agreement. 167 So.2d at 82. B & P’s stockholder agreement, which was signed by Rosenbaum, contains a section that purports to address the distribution of fees when a shareholder withdraws from the firm. This section is embedded in the agreement’s covenant not to compete. The agreement states that in the event that a shareholder breaches the covenant not to compete and continues an ongoing matter, the shareholder would compensate B & P the greater of 50% of the fee received or the firm’s quantum meruit.

 

The Florida Supreme Court disapproves of lawyers entering covenants not to compete and other agreements that restrict lawyers’ right to practice. “A lawyer shall not participate in offering or making: (a) a … shareholders … agreement that restricts the rights of a lawyer to practice after termination of the relationship, except an agreement concerning benefits upon retirement….” Fla. R. Prof. Conduct 4–5.6. Moreover, the comments make clear the public policy behind this rule, as “[a]n agreement restricting the right of lawyers to practice after leaving a firm not only limits their professional autonomy, but also limits the freedom of clients to choose a lawyer.” Fla. R. Prof. Conduct 4–5.6, cmt. However, “[a] contract is not void, as against public policy, unless it is *664 injurious to the interests of the public, or contravenes some established interest of society.” Neiman v. Galloway, 704 So.2d 1131, 1132 (Fla. 4th DCA 1998) (citations omitted).

 

**6 Florida courts have not used Rule 4–5.6 to invalidate contracts between private parties as a matter of law. See Lee v. Fla. Dep’t of Ins. & Treasurer, 586 So.2d 1185, 1188 (Fla. 1st DCA 1991). Yet, Lee involved a settlement agreement between non-attorneys wherein the counsel for the plaintiff agreed not to represent a government agency in future proceedings against Mr. Lee. Id. at 1187. The court specifically found that Rule 4–5.6

is intended to prevent lawyers from entering into agreements that operate to restrict a lawyer’s right to practice generally … that Rule does not reach agreements with or by the client to preclude the lawyer’s representation of other persons with respect to cases that involve the same facts, transactions, and events as does the case settled for the client. Failure to give effect to this distinction would defeat the protections of confidential information provided in rules 4–1.6 and 4–1.9.

Id. at 1190. Thus, Lee is clearly distinct from the instant case, as the agreement between B & P and Rosenberg was between attorneys and operated as a general restriction against Rosenberg’s right to practice. Moreover, Florida courts have previously relied solely on professional responsibility rules to invalidate agreements between attorneys relating to fees. See, e.g., Robert A. Shupack, P.A. v. Marcus, 606 So.2d 466, 467 (Fla. 3d DCA 1992) (invalidating a fee sharing agreement because it violated a disciplinary rule found in the predecessor to the Florida Rules of Professional Conduct).

 

The public policy behind prohibiting covenants not to compete is clearly stated in the Rules and has been affirmed in disciplinary actions. See, e.g., The Fla. Bar v. St. Louis, 967 So.2d 108, 121 (Fla.2007) (finding Rule 4–5.6 promotes public welfare and is constitutionally valid). In an independent matter, Rosenbaum, himself, alleged that the covenant not to compete in B & P’s stockholder agreement is void as against public policy. Rosenbaum v. Becker & Poliakoff, P.A., 08–81004–civ, 2010 WL 376309, at *7 (S.D.Fla. Jan. 26, 2010). At least for the purpose of the charging liens at issue, we find that the covenant not to compete and embedded fee distribution are not controlling and will apply the common law in distributing the total fee award.7 Therefore, the proper distribution of the contingency fees in this case is determined by Frates.

 

 

D.

[4] While Frates applies to both partnerships and professional corporations, we are currently presented a situation where a partner exits the initial firm, but thereafter exits from the second firm during the same ongoing matter. Applying a “Frates within Frates ” analysis, the common law solution seems to indicate that the second and third firms would share the exiting partner’s share, with the third firm’s fee being determined by the second firm’s partnership agreement. However, it is the exiting attorney and not the subsequent firm that owes the fiduciary duties to wind up the initial partnership’s business, and it is these fiduciary duties that are at the heart of Frates. When a firm with no fiduciary duties to wind up another firm’s affairs works on a matter for a contingency *665 fee, and the contingency occurs during another firm’s representation, the amount of the firm’s fee in the matter is determined by quantum meruit. See Rosenberg, 409 So.2d at 1021; Poletz, 652 So.2d at 368.

 

**7 In the present matter, Rosenberg, not the other attorneys at KGR, had the pre-existing duty to represent Buckley. The remaining attorneys at KGR did not owe fiduciary duties to wind up B & P’s affairs, but worked on Buckley’s case on a contingency fee basis. Since that contingency occurred while RMJS was counsel of record for Buckley, KGR is entitled to a quantum meruit award of fees.

 

 

E.

[5] While the district court did not apply a proper Frates analysis, the court did determine a quantum meruit award for KGR. We find that the district court abused its discretion by awarding KGR a quantum meruit award of $894,897. “An abuse of discretion occurs if the judge fails to apply the proper legal standard or to follow proper procedures in making the determination, or bases an award upon findings of fact that are clearly erroneous.” Johnson v. Breeden, 280 F.3d 1308, 1326 (11th Cir.2002) (quotation omitted).

 

In determining the reasonable value of an attorney’s services, the court should consider the totality of the circumstances surrounding the professional relationship, including time spent on the matter, the recovery sought, the skill demanded, the results obtained and the attorney-client contract. Rosenberg, 409 So.2d at 1022. While the trial court may consider a lodestar calculation in determining a firm’s quantum meruit, the court errs as a matter of law if it fails to consider “other factors surrounding the professional relationship that would assist the court in fashioning an award that is fair to both the attorney and client,” such as the reason the firm was discharged, actions taken by the firm or client before or after discharge, and the benefit actually conferred on the client. Poletz, 652 So.2d at 369. Moreover, “[u]nlike an award of attorney’s fees to a prevailing party, a quantum meruit award must take into account the actual value of the services to the client.”8 Id.

 

The magistrate based the amount of KGR’s fee award on Buckley’s successful motion seeking attorney’s fees from QBE. While a lodestar calculation is not an improper starting point, the magistrate failed to properly consider the totality of the circumstances, particularly the benefit conferred on the client. On March 26, 2009—after the jury trial but prior to the first appeal to this Court—Buckley filed its initial motion for entitlement to attorney’s fees, arguing it was entitled to recover attorney’s fees from QBE based on a Florida Statute permitting fee shifting in claims enforcing an insured’s rights under an insurance contract. For KGR’s portion of the fees, Buckley sought an award of $2,695,436.87.9 After the court ordered the parties to meet and confer, Buckley filed an amended motion for attorney’s fees (again prior to the first appeal to this Court), stating that the parties had reached an agreement as to a lodestar amount for KGR’s work at $894,897, but disagreed as to the application of a risk multiplier in the case. Thereafter, the *666 magistrate denied the application of a risk multiplier and the court ordered QBE to pay Buckley $894,897 for KGR’s work on the matter.

 

**8 In calculating KGR’s quantum meruit, the magistrate used the previously determined lodestar amount as a starting point. The magistrate concluded that this award sufficiently accounted for the length of the attorney-client relationship, the risk of non-recovery, and the skills required in the case. However, the magistrate failed to properly account for the totality of the circumstances and apply the remaining Poletz factors, including the benefit actually conferred on the client. Specifically, in addition to Buckley’s motion for fees against QBE, this Court granted Buckley’s application for appellate attorney’s fees and remanded to the district court for its consideration as to a reasonable amount of fees. Buckley sought fees in the amount of $75,232.50 for the appellate work of KGR.10 The district court abused its discretion by not accounting for the benefit conferred on the client by KGR while it worked on post-trial matters and briefed the first appeal before this Court.

 

While we appreciate the magistrate’s focus on judicial efficiency and ruling in equity, it was improper to value KGR’s charging lien without considering the significant work KGR did on the appeal. Thus, we must remand the matter back to the district court to properly consider the Rosenberg and Poletz factors, including the benefit conferred on Buckley by KGR’s representation throughout the trial and the preliminary appellate work.

 

 

F.

[6] In the end, while the magistrate applied an incorrect legal standard and did not fashion an award that fairly compensated KGR, there is only one issue to be decided on remand—KGR’s proper quantum meruit award.11 Under a proper application of Frates and Poletz, the value of KGR’s charging lien should be the firm’s quantum meruit. Once the amount of KGR’s charging lien is determined, the value of RMJS’s charging lien can be determined based on Rosenbaum’s equity share as set forth in B & P’s controlling stockholder agreement, which provides that Rosenberg owned 20 of the 855 outstanding shares. Therefore, RMJS is entitled to 20/855—or approximately 2.34%—of the fee award remaining after KGR is compensated.12

 

 

  1. Conclusion

Accordingly, we reverse the district court’s order on KGR’s and RMJS’s motions to enforce their charging liens, and *667 remand for further proceedings consistent with this opinion.

 

REVERSED and REMANDED.

 

All Citations

519 Fed.Appx. 657, 2013 WL 2150901

 

 

Footnotes

 

1

 

We note that Becker & Poliakoff, P.A. (“B & P”), also appealed its recovery of $681,063 under the charging lien it filed in the present matter, but B & P settled its claim and withdrew its appeal.

 

2

 

A portion of the appeal remained pending until the Florida Supreme Court resolved two certified questions.

 

3

 

The parties do not contest the application of Florida law or the total fee award, only the allocation of that total fee among the law firms.

 

4

 

B & P and RMJS’s settlement agreement was approved by the district court and comprised of the $681,063 awarded in the R & R, and an additional $618,937 of the fees awarded to RMJS. Buckley Towers Condo., Inc. v. QBE Ins. Corp., No. 07–22988–civ (S.D.Fla. Aug. 16, 2012) (order to partially release funds held in court registry).

 

5

 

Sections in Florida’s RUPA are consistently numbered with RUPA, so that Florida Statutes section 620.8601 corresponds with the Uniform Partnership Act section 601. However, subsections under Florida’s RUPA begin with numerals while RUPA begins subsections with letters, so that Florida Statutes section 620.8401(8) corresponds with Uniform Partnership Act section 401(h).

 

6

 

The uniform comments clarify a partner’s fiduciary duties upon dissociation and that “[n]o change from the current law is intended.” Unif. P’Ship Act § 603, cmt. 2 (1997). The commentary goes on to provide an example of a partner leaving a brokerage firm, confirming that the withdrawing partner “may immediately compete with the firm for new clients, but must exercise care in completing on-going client transactions and must account to the firm for any fees received from the old clients on account of those transactions.Id. (emphasis added).

 

7

 

As the issue before the Court is the validity and value of the charging liens of KGR and RMJS, nothing in this opinion prevents the attorneys from seeking alternative contractual remedies in state court, as between themselves.

 

8

 

The Poletz court also found that the lodestar calculation was intended to apply to fees imposed ancillary to the primary action against a non-client and is ill-suited for the task of assessing attorney’s fees due by a client under a quantum meruit analysis. 652 So.2d at 368–69.

 

9

 

Buckley argued that KGR was entitled to a lodestar calculation of $1,026,717 and a contingency multiplier of 2.25.

 

10

 

For reasons not obvious from the record, Buckley withdrew its motion for appellate attorney’s fees, despite the fact that QBE did not challenge Buckley’s entitlement to the appellate attorney’s fees. However, Buckley’s withdrawal of the motion is irrelevant for our analysis because an attorney’s quantum meruit award does not hinge on whether an opposing party is liable for fees. See Poletz, 652 So.2d at 368 (“fair value attorney fee recoverable in quantum meruit is not measured by the standards applied when fees are awarded opposing party under fee-shifting statute or doctrine”) (citing Restatement (Third) of The Law Governing Lawyers, Tentative Draft No. 4 § 51 (Apr. 10, 1991)).

 

11

 

We do not intend to significantly burden the district court with this decision, and think it within the district court’s discretion to simply reconsider the amount of KGR’s quantum meruit award based on the arguments and evidence previously submitted to the court, or, if the district court deems it more appropriate, to allow the parties to re-argue the issue.

 

12

 

We note that because B & P settled its claim for $1.3 million, it is entitled to no greater award than that amount to which it agreed. See Rosenberg, 409 So.2d at 1022 (limiting an attorney’s fee recovery to the contract fee agreed to by the attorney). Consequently, any award that B & P would be entitled to above the $1.3 million agreed-upon amount should be returned to Buckley. For example, if the magistrate determines KGR’s quantum meruit award to equal the $894,897 awarded plus the $75,232.50 sought in appellate fees, for a total of $970,129.50, then (a) RMJS would be entitled to $85,696.31 (approximately 2.34% of the remaining $3,663,517.36); (b) B & P would be entitled to its $1.3 million; and (c) the remaining $2,277,821.05 set aside in the court registry for the charging liens would be returned to Buckley. This example is used entirely for demonstrative purposes and is not intended to dissuade the district court from using its sound discretion to determine a proper value for KGR’s charging lien.

 

 

 

 

 

 

End of Document

 

© 2016 Thomson Reuters. No claim to original U.S. Government Works.

 

 

 

 

 

 

 

60 So.3d 575

District Court of Appeal of Florida,

Second District.

MORGAN & MORGAN, P.A., Appellant,

v.

GUARDIANSHIP OF Larry McKEAN, Appellee.

No. 2D09–5098.

|

May 13, 2011.

Synopsis

Background: Client’s guardian filed a sworn petition in the trial court seeking a determination of the amount of attorney fees due to law firm for legal services rendered on behalf of client. The Circuit Court, Lee County, Lynn Gerald, Jr., J., found that a valid contingency fee contract did not exist and, thereafter, entered an order denying any fees, and law firm appealed.

 

[Holding:] The District Court of Appeal, Kelly, J., held that quantum meruit case would be remanded for the trial court to reconsider whether to award attorney fees to discharged law firm under a totality of the circumstances standard.

 

Affirmed in part, reversed in part, and remanded.

 

 

 

West Headnotes (5)

 

 

[1]

 

Attorney and Client

Premature Termination of Relation

 

 Although time spent on legal case is one factor to be considered when computing reasonable value of discharged attorney’s services with respect to cause of action for quantum meruit, the trial court must consider the totality of the circumstances surrounding the professional relationship in computing the reasonable value of the services rendered.

1 Cases that cite this headnote

 

 

 

[2]

 

Attorney and Client

Premature Termination of Relation

 

 Unlike an award of attorney fees to a prevailing party, a quantum meruit award for reasonable value of discharged attorney’s services must take into account the actual value of the services to the client.

Cases that cite this headnote

 

 

 

[3]

 

Attorney and Client

Premature Termination of Relation

 

 While the time reasonably devoted to the representation and a reasonable hourly rate are factors to be considered in determining a proper quantum meruit award for value of discharged attorney’s services, the court must consider all relevant factors surrounding the professional relationship to ensure that the award is fair to both the attorney and client.

1 Cases that cite this headnote

 

 

 

[4]

 

Attorney and Client

Premature Termination of Relation

 

 The basis for a quantum meruit award for reasonable value of discharged attorney’s services is essentially an equitable one: one person should not benefit from the work efforts of another under circumstances where the person doing the work has the reasonable expectation of being paid by the person benefited, and the person benefited has a reasonable expectation of paying for the work.

Cases that cite this headnote

 

 

 

[5]

 

Appeal and Error

Insufficiency of verdict or findings

 

 Because trial court failed to recognize that it had the discretion to consider factors other than time spent on the case, quantum meruit case would be remanded for the trial court to reconsider whether to award attorney fees to discharged law firm under a totality of the circumstances standard.

1 Cases that cite this headnote

 

 

 

Attorneys and Law Firms

*576 Celene H. Humphries of Brannock & Humphries, Tampa, and Joseph Linnehan of Morgan & Morgan, P.A., Fort Myers, for Appellant.

Stacy L. Sherman, Fort Myers, for Appellee.

Opinion

KELLY, Judge.

 

Morgan & Morgan, P.A., appeals from the order which denies it an award of attorney’s fees for services rendered on behalf of Larry McKean. Because the trial court failed to apply the appropriate legal standard to determine an award of fees under a quantum meruit theory, we reverse and remand for further proceedings.

 

This suit arose when Beth Brockmann filed a sworn petition in the trial court seeking a determination of the amount of attorney’s fees due to Morgan & Morgan for legal services rendered on behalf of her brother, Larry McKean. According to the petition, Mr. McKean was severely injured in a motorcycle accident. Ms. Brockmann contacted Morgan & Morgan seeking representation in the case. She signed a contingency fee agreement the law firm had sent her by way of a “runner.” Within four weeks, Morgan & Morgan obtained a settlement with the insurance company for the policy limits. Ms. Brockmann was appointed her brother’s guardian a week after the settlement was reached. Thereafter, Ms. Brockmann “became dissatisfied with the services of Morgan & Morgan” and refused to sign any further agreements in her capacity as guardian. She claimed that the contingency fee agreement she previously signed was invalid and asked the court to “determine the fees due to Morgan & Morgan on a quantum meruit basis.”

 

The trial court found that a valid contingency fee contract did not exist and held a *577 hearing to determine reasonable fees under a quantum meruit theory. Thereafter, the court entered an order denying any fees. In its order, the court recognized that law firms normally operating under contingency fee agreements are not accustomed to keeping accurate time records because of the nature of the practice; nonetheless, the court found that the lack of evidence of the time spent on the case was fatal to an award of fees. Specifically, the trial court found:

[T]here has not been enough evidence that this Court can set a fee based on evidence when there were no time records; there was [no] attempt to re-create the amount of time; the testimony and case manager who handled the file could say “well we had [ ] 80 hours or we had 20 hours” but they could not be more specific than that or at least didn’t in their testimony. Mr. Gaeta’s1 testimony was that of how a normal personal injury lawyer would handle the fee but again had no idea of the actual time involved. Without some specificity of time in much more detail than what was given to this Court at this hearing, it is hereby

 

ORDERED AND ADJUDGED that there is no basis for making the award and the Motion for Attorney Fees on the basis of quantum [meruit] is hereby denied.

On appeal, Morgan & Morgan argues that the trial court erred in finding that the contingency fee agreement Ms. Brockmann signed was invalid. Alternatively, Morgan & Morgan argues that even if the agreement was invalid and unenforceable, the trial court erred in denying the firm any fees under a quantum meruit theory.

 

[1] We affirm without comment the trial court’s finding that a valid contingency fee contract did not exist and that the determination of fees was therefore proper under a quantum meruit theory. See Chandris, S.A. v. Yanakakis, 668 So.2d 180, 186 n. 4 (Fla.1995) (noting that, even though an attorney cannot claim fees based upon a noncomplying contingency fee agreement, the attorney would still be entitled to the reasonable value of his or her services on the basis of quantum meruit). However, we disagree with the trial court’s conclusion that fees could not be awarded solely because Morgan & Morgan did not keep, or attempt to recreate, accurate time records. Although time spent on a case is one factor to be considered under a quantum meruit theory, the trial court must consider “the totality of the circumstances surrounding the professional relationship” in computing the reasonable value of the services rendered. Rosenberg v. Levin, 409 So.2d 1016, 1022 (Fla.1982).

 

[2] [3] “Unlike an award of attorney’s fees to a prevailing party, a quantum meruit award must take into account the actual value of the services to the client.” Searcy, Denney, Scarola, Barnhart & Shipley, P.A. v. Poletz, 652 So.2d 366, 369 (Fla.1995). “Thus, while the time reasonably devoted to the representation and a reasonable hourly rate are factors to be considered in determining a proper quantum meruit award, the court must consider all relevant factors surrounding the professional relationship to ensure that the award is fair to both the attorney and client.” Id. In Searcy, the court noted that factors which might be considered are actions taken by the attorney or client before or after discharge, and the benefit actually conferred on the client. Id. The weight to be given various factors and the ultimate determination as to the amount to *578 be awarded are matters left up to the sound discretion of the court. Id.

 

[4] “The basis for a quantum meruit award is essentially an equitable one. One person should not benefit from the work efforts of another under circumstances where the person doing the work has the reasonable expectation of being paid by the person benefitted, and the person benefitted has a reasonable expectation of paying for the work.” Hallowes v. Bedard, 877 So.2d 953, 957 (Fla. 5th DCA 2004). In this case, the appellee’s reasonable expectation of paying for the work was demonstrated by the filing of the petition asking the court to determine the amount of attorney’s fees due to Morgan & Morgan.

 

[5] Because the court in this case failed to recognize that it had the discretion to consider factors other than time spent on the case, we reverse and remand for the trial court to reconsider whether to award fees under a “totality of the circumstances” standard. See Searcy, 652 So.2d at 369.

 

Affirmed in part, reversed in part, and remanded for further proceedings.

 

WHATLEY, J., and BAUMANN, HERBERT J., Associate Judge, Concur.

All Citations

60 So.3d 575, 36 Fla. L. Weekly D1028

 

 

Footnotes

 

1

 

Joseph Gaeta, a personal injury attorney, was the expert witness Morgan & Morgan called to testify about a reasonable fee for the services rendered.

 

 

 

 

 

 

End of Document

 

© 2016 Thomson Reuters. No claim to original U.S. Government Works.

 

 

 

 

 

 

 

877 So.2d 953

District Court of Appeal of Florida,

Fifth District.

Borden R. HALLOWES, Appellant,

v.

Ronald BEDARD and Barbara Bedard, his wife, Appellee.

No. 5D03-3184.

|

July 30, 2004.

Synopsis

Background: Attorney brought quantum meruit action against clients, seeking to recover allegedly unpaid attorney fees. Following a non-jury trial, the Circuit Court, St. Johns County, J. Michael Traynor, J., entered judgment for clients. Attorney appealed.

 

Holdings: The District Court of Appeal, Sharp, W., J., held that:

 

[1] relevant factors in determining reasonable fee included attorney’s failure to periodically bill clients, attorney’s failure to communicate hourly rate, attorney’s lack of experience in handling such matters, and attorney’s failure to apply to circuit court for award of attorney fees against dealer, and

 

[2] attorney was not entitled to recover against clients.

 

Affirmed.

 

 

 

West Headnotes (6)

 

 

[1]

 

Attorney and Client

Right to Compensation in General

 

 In determining attorney’s reasonable fees based on quantum meruit regarding representation in arbitration proceeding against securities dealer, relevant factors included attorney’s failure to periodically bill clients during more than one year that it took to pursue claim, attorney’s failure to communicate hourly rate to clients at any time prior to submitting final bill, attorney’s lack of experience in handling such matters, and attorney’s failure to apply to circuit court for award of attorney fees against dealer following arbitration. West’s F.S.A. Bar Rule 4-1.5(b).

Cases that cite this headnote

 

 

 

[2]

 

Attorney and Client

Value of Services

 

 When determining reasonable fee for an attorney in a quantum meruit situation, reasonable time spent on matter and attorney’s hourly rate are factors, and bar rule setting forth factors to be considered in determining reasonable fee is a starting point. West’s F.S.A. Bar Rule 4-1.5(b).

Cases that cite this headnote

 

 

 

[3]

 

Attorney and Client

Right to Compensation in General

 

 Criteria used to determine reasonable fee for an attorney in a quantum meruit situation should encompass all relevant factors surrounding the professional relationship, including the actions taken by the attorney, whether and to what extent they benefited the client, the skill demanded and demonstrated, and the results obtained. West’s F.S.A. Bar Rule 4-1.5(b).

Cases that cite this headnote

 

 

 

[4]

 

Attorney and Client

Right to Compensation in General

 

 Attorney was not entitled to recover in quantum meruit action against clients regarding fees allegedly earned for services performed in arbitration proceeding against securities dealer; evidence indicated that attorney agreed to look only to arbitrator’s fee award for recovery of fees, and attorney failed to effectively pursue possibility of obtaining fee award from dealer before seeking fees from clients.

1 Cases that cite this headnote

 

 

 

[5]

 

Implied and Constructive Contracts

Work and Labor in General;  Quantum Meruit

 

 Basis for a quantum meruit award is essentially an equitable one: one person should not benefit from the work efforts of another under circumstances where the person doing the work has the reasonable expectation of being paid by the person benefited, and the person benefited has a reasonable expectation of paying for the work.

3 Cases that cite this headnote

 

 

 

[6]

 

Attorney and Client

Construction and Operation

 

 If a lawyer agrees to only accept fees that will be awarded against an opposing party, that agreement can be binding on the lawyer with respect to any attempt to recover fees from client.

Cases that cite this headnote

 

 

 

Attorneys and Law Firms

*954 Borden R. Hallowes, Fernandina Beach, pro se.

*955 R.J. Larizza of R.J. Larizza, P.A., St. Augustine, for Appellees.

Opinion

SHARP, W., J.

 

Hallowes appeals from a final judgment rendered after a non-jury trial, which denied his request for an award of attorney fees against Ronald and Barbara Bedard, based on quantum meruit. Hallowes represented the Bedards in prosecuting their claim against First Union Securities and others for investment losses, beginning with reviewing their letter claim form and handling the arbitration of their claim under NASD (National Association of Securities Dealers) Code of Arbitration Procedure through arbitration, a process that lasted a little over one year. The trial judge ruled that Hallowes was not entitled to recover attorney fees from the Bedards for two reasons: first, that Hallowes’ expert witness to establish the reasonableness of fees to be awarded, based on quantum meruit, did not take into consideration all of the criteria required pursuant to Searcy, Denney, Scarola, Barnhart & Shipley, P.A. v. Poletz, 652 So.2d 366 (Fla.1995); and second, that the Bedards had good reason to believe Hallowes undertook their representation with the understanding and expectation that he would be paid for his services solely by an award imposed against First Union, et al., as a result of the arbitration. Because both findings are supported by competent, substantial evidence, even though in dispute, we affirm.

 

The circumstances and facts in this case are highly unusual. Hallowes admitted that he had never, in his lengthy legal career of forty years, handled a client representation in such a manner. He testified he has never had a case like this one, where he did not have a written contract, never discussed his hourly rate, and never provided a bill to his client until the legal matter had been concluded.

 

He first met Ronald Bedard after being assigned to play golf with him at the Oakridge Country Club. When Hallowes told Bedard he was an attorney, Bedard told him he and his wife were in the process of filing a claim with NASD to seek a recovery against First Union for investment losses. Hallowes offered to assist.

 

Bedard pointed out that on the letter form he intended to file there was a box to check to request the arbitration panel to award attorney fees. Bedard told Hallowes that if he wanted to assist him, he would check the box and claim attorney’s fees. Bedard testified he told Hallowes that his fees would be paid on that basis. Hallowes said: “Well, yeah, that would be fine.”

 

This conversation took place either in the parking lot at the Country Club, or in the Bedards’ home, when Hallowes and his wife happened to stop by while riding their bicycles, one weekend shortly after Bedard and Hallowes first met. Bedard signed a document, which he sent to NASD, indicating Hallowes was representing him in this matter and Hallowes began work on the case.

 

Hallowes testified that a lot of his review of records and work was done at the Bedards’ home, sitting at their dining room table and at a Burger King restaurant, and discussions about the claim took place while they were playing golf. Hallowes never told the Bedards what his hourly rate (fee) charge would be ($250.00), or the fee he would charge them per day for conducting the case for them at arbitration ($3,500.00). He never sent them an interim billing or statement until the arbitration had been concluded. They never signed a written agreement for Hallowes’ services.

 

*956 As time progressed, Hallowes became uncomfortable with the fact that he had no written contract to cover his representation and fees. He presented the Bedards with two or three contingency fee contracts, one very shortly before the arbitration proceeding was scheduled. Each time Bedard refused to sign a contingency fee contract. He testified he reminded Hallowes that he had agreed to seek his fees from First Union and that he (Bedard) would not pay him out of his pocket: “I made it very clear.”

 

Hallowes testified he was upset by the failure of the Bedards to sign a written contingency fee contract. He tried to get them “to come up with something,” but “we never did.” He did not want to press them, because they were friends, nor did he want to withdraw immediately before the arbitration. He was “resigned.” At the end, he felt “what the heck … just go ahead and … get it over with.” In turn, Bedard testified that after he rejected the last contingency fee contract, he feared that Hallowes might not appear for the arbitration hearing. Bedard was prepared to proceed on his own.

 

The arbitration decision awarded the Bedards $86,546.83, as compensatory damages, plus interest, bringing the total award to $106,834.01. The Bedards had sought compensation for $264,000 in investment losses, punitive damages of $235,000, attorney’s fees and costs. The costs were $10,000.00.1 The arbitration panel denied punitive damages, attorney’s fees and costs.

 

Hallowes admitted he had not researched how to obtain an attorney’s fee award in an arbitration proceeding and as a result, the arbitration panel could not have awarded attorney fees, against First Union. Bedard was also unaware he could have sought fees against First Union by filing suit in circuit court, after the arbitration award was final.2 Accordingly, Hallowes failed to apply to the circuit court to have the award certified and to pursue his claim for attorney’s fees in that venue.

 

 

  1. Expert Testimony to Establish Attorney’s Fees Based on Quantum Meruit.

[1] The Searcy case is the Florida Supreme Court’s most current direction to the Florida Bar and courts concerning the criteria to be used in determining a reasonable fee for an attorney in a quantum meruit situation. That is to say, when there is no controlling contract between the client represented and the attorney, and the attorney is seeking fees against the client. In Searcy, there had been a contingency fee contract, but the attorney was discharged without cause prior to the resolution of the case. But the Searcy case has been applied to other situations where there was no written contract. See Frank J. Pepper, Inc. v. Vining, 783 So.2d 1160 (Fla. 3d DCA 2001).

 

[2] [3] The Searcy court said that the lodestar method of calculating fees,3 should not be applied if the fee is to be paid by the client or other contracting party. Reasonable time and rate are factors, and Florida Bar Rule 4-1.5(b) is a starting point. But the criteria should encompass all relevant factors surrounding the professional relationship, including the actions *957 taken by the attorney, whether and to what extent they benefitted the client, the skill demanded and demonstrated, and the results obtained. It concluded that the determination as to which factors are relevant in a given case, the weight to be given each factor and the ultimate determination as to the amount to be awarded, are matters within the sound discretion of the court. In Searcy, the court overturned the trial court’s attorney’s fee award because it failed to “consider the totality of the circumstances present in this case, considering only the time reasonably expended and the reasonable hourly rate for the services, as determined under the principles set forth in Rowe.” 652 So.2d at 369.

 

In this case, Hallowes’ expert witness testified as to the reasonableness of Hallowes’ hourly rate charged ($250.00 per hour), the daily rate for handling the arbitration proceedings, and the time spent on the case, resulting in the total of $39,046.10.4 He based his opinion primarily on the lodestar method, but did not add any multipliers. He also added he had considered the case law as well as the Code of Professional Responsibility.

 

However, the expert admitted he did not consider that Hallowes had not periodically billed the Bedards during the more than year it took to pursue the claim through arbitration, and that Hallowes had not communicated to them his billing rate at any time prior to presenting them with his final bill after the arbitration had concluded. He also did not consider that Hallowes had not previously handled a NASD arbitration proceeding. Nor did he opine about the benefit and quality of the legal services rendered in this case. Was this a good result or not for the Bedards? The expert did not address this. Nor did he consider the fact that Hallowes failed to apply to the circuit court for an award of attorney’s fees following the arbitration proceedings. See D.H. Blair & Co., Inc. v. Johnson, 697 So.2d 912 (Fla. 4th DCA 1997).

 

In addition, the expert witness did not take note of the fact that Hallowes had not represented the Bedards prior to this claim and that his professional relationship began and was continuously intermingled with their golfing, social-friend relationship. Hallowes testified he knew he should have obtained a contract with the Bedards for his representation of them in connection with their arbitration claim. He was understandably uncomfortable with this situation, but he continued because they were friends.

 

 

  1. Quantum Meruit on the “Merits.”

[4] [5] The basis for a quantum meruit award is essentially an equitable one. One person should not benefit from the work efforts of another under circumstances where the person doing the work has the reasonable expectation of being paid by the person benefitted, and the person benefitted has a reasonable expectation of paying for the work. Osteen v. Morris, 481 So.2d 1287, 1289-90 (Fla. 5th DCA 1986). The trial court found that the Bedards accepted Hallowes’ services and work under the reasonable belief that he would be paid for his services through a fee awarded by the arbitration panel against First Union, and not by them.5 It also found that Hallowes could voice no *958 explanation as to the foundation of his belief that the Bedards would pay him a reasonable fee for his services rather than looking to the arbitration award.6 These findings, although disputed by Hallowes, are supported by the testimony of the Bedards at trial and Hallowes’ admissions.

 

[6] Given these findings by the trial court, there is no basis upon which to premise a quantum meruit award, even if the expert witness had based his opinion on the required criteria. Indeed, the expert witness admitted that it is possible for an attorney to agree to represent a client for free, or to look solely for the payment of fees from an opposing party. If a lawyer agrees to only accept fees that (hopefully) will be awarded against an opposing party, that can be binding on the lawyer. The expert witness concluded that Hallowes should be paid a reasonable sum for the work he did for the Bedards, unless he agreed to do it for nothing. Or, as suggested by this record, if he agreed to look only to the arbitrator’s fee award. The trial court, based on this record, concluded that was what happened in this case. We cannot disagree.7

 

In addition, we are also troubled by the fact that Hallowes did not research how a party can obtain an attorney fee award in an arbitration proceeding, and how such an award can be sought in the circuit court following arbitration.8 Equity would require that Hallowes effectively and to the best of his ability, pursue the possibility of obtaining a fee award from First Union before seeking it from the Bedards.

 

AFFIRMED.

 

THOMPSON and MONACO, JJ., concur.

All Citations

877 So.2d 953, 29 Fla. L. Weekly D1736

 

 

Footnotes

 

1

 

It also appears from prior pleadings that the Bedards had paid $3,800.00 for the services of an expert witness, but because necessary documentation was not submitted prior to arbitration, the documents and the expert were excluded at the arbitration proceeding.

 

2

 

See D.H. Blair & Co., Inc. v. Johnson, 697 So.2d 912 (Fla. 4th DCA 1997).

 

3

 

Florida Patient’s Compensation Fund v. Rowe, 472 So.2d 1145 (Fla.1985).

 

4

 

The bill included 106 hours of work billed at $250.00 per hour, three and one-half days for the arbitration sessions at $3,500 per day, and 940 miles for travel.

 

5

 

The court ruled: “It is not difficult to understand why the Bedards believed [Hallowes] had agreed under these circumstances that he would accept such fee as might be awarded by the arbitration panel.”

 

6

 

The court ruled:

Mr. Hallowes indicated that he continued to help the Bedards believing that he would be paid a reasonable fee for his services. However, no explanation was offered by Mr. Hallowes as to the foundation for such a belief.

 

7

 

Porzio v. Porzio, 760 So.2d 1075 (Fla. 5th DCA 2000); Patrick v. Christian Radio, 745 So.2d 578 (Fla. 5th DCA 1999); Love PGI Partners, LP v. Schultz, 706 So.2d 887 (Fla. 5th DCA 1998), approved, 731 So.2d 1270 (Fla.1999).

 

8

 

The court found: “[Hallowes] offered no explanation as to why fees were not sought in a Circuit Court proceeding.”

 

 

 

 

 

 

End of Document

 

© 2016 Thomson Reuters. No claim to original U.S. Government Works.

 

 

 

 

 

 

 

 

KeyCite Yellow Flag – Negative Treatment

855 So.2d 1186

District Court of Appeal of Florida,

Third District.

Melissa LACKEY, Appellant,

v.

BRIDGESTONE/FIRESTONE, INC., d/b/a Dayton Tire Company, a Tennessee corporation; Ford Motor Company, Inc., a Michigan corporation; Bella Automotive Group, Ltd., a Florida limited partnership, d/b/a Headquarter Toyota; and Bella Automotive Group, Inc., a Florida corporation, individually and as general partner of Bella Automotive Group, Ltd., d/b/a Headquarter Toyota, Appellees.

No. 3D02-1009.

|

Oct. 8, 2003.

Client appealed from order of the Circuit Court, Miami-Dade County, Ronald C. Dresnick, J., which approved division of attorney’s fees by allocating fees among three attorneys pursuant to representation agreement between client and one attorney. The District Court of Appeal, Shevin, J., held that: (1) unenforceable provisions in representation agreement did not render entire agreement void or affect fee arrangement, but (2) evidence was insufficient to support award to other two attorneys, who were not parties to agreement and thus could only recover fees based on quantum meruit.

 

Affirmed in part, reversed in part, and remanded.

 

 

 

West Headnotes (3)

 

 

[1]

 

Attorney and Client

Requisites and Validity of Contract

 

 Attorney was entitled to recover fees under contingent fee agreement as included in representation agreement with client, although portions of representation agreement were unenforceable; infirm clauses were not at issue in fee dispute, and contingent fee clauses in agreement did not violate rules governing contingent fees.

6 Cases that cite this headnote

 

 

 

[2]

 

Attorney and Client

Evidence

Attorney and Client

Performance

 

 Evidence was insufficient to support amount of attorney’s fee award to attorneys who lacked contingent fee agreement with client, although they settled case for client and were entitled to fees on a quantum meruit basis; one attorney’s testimony at fee hearing did not specify time he expended on case or his hourly rate, and other attorney did not appear at hearing and was not represented.

3 Cases that cite this headnote

 

 

 

[3]

 

Attorney and Client

Right to Compensation in General

 

 An attorney who has no contingent fee agreement with a client is only entitled to recover fees on a quantum meruit basis.

4 Cases that cite this headnote

 

 

 

Attorneys and Law Firms

*1187 Michael M. Tobin, Coral Gables; Caruso, Burlington, Bohn & Compiani and Philip Burlington, West Palm Beach, for appellant.

Marc Cooper and Ervin Gonzalez, Coral Gables, for Colson Hicks Eidson and Turner & Associates.

Lauri Waldman Ross and Theresa L. Girten, Miami, for Friedman & Friedman, appellees.

Before GREEN and SHEVIN, JJ., and NESBITT, Senior Judge.

Opinion

SHEVIN, Judge.

 

Melissa Lackey appeals an order disbursing settlement funds and approving the division of attorneys’ fees. We affirm in part, reverse in part, and remand.

 

Melissa Lackey was a passenger in a Ford Explorer driven by her boyfriend, Kelvin Naranjo. She was injured when the Explorer rolled over after a rear tire blew out. Naranjo retained Marvin Friedman to represent him. Thereafter, Lackey also retained Friedman and entered into a contingent fee agreement with him. Friedman referred the case to Mike Eidson, of the Colson Hicks Eidson firm. Eidson testified that when he met Lackey, he told Lackey that Tab Turner, an Arkansas attorney, would be involved in the case.1 Lackey did not sign a retainer agreement with either Eidson or Turner. Eidson’s firm sued Firestone/Bridgestone, Ford Motor Company and Naranjo on Lackey’s behalf. The case against Ford was settled. However, Lackey was dissatisfied with the attorneys’ fees detailed in the closing statement. It allocated 40% of *1188 the first million dollars as fees, pursuant to the Friedman contingent fee agreement, to be split among the three attorneys. Thereafter, Lackey discharged the attorneys.

 

The attorneys petitioned the court to approve the fee division and to disburse settlement funds as fees. Lackey asserted that the attorneys were only entitled to 33 1/3% of the first million dollars recovered. She challenged the fee request alleging that Friedman should be disqualified from recovering a fee because a conflict of interest existed between Lackey and Naranjo, and because portions of the agreement violated the Rules Regulating the Florida Bar. Lackey also argued that Eidson and Turner were not entitled to participate in the fee as she had not entered into a written agreement with them. After a hearing, the court approved Friedman’s requested fee, and approved Eidson and Turner sharing in that fee. Lackey appeals.

 

[1] First, we address the issue of whether Friedman was entitled to recover fees under the contingent fee agreement. We are not persuaded that the inclusion of the infirm clauses renders the agreement void and forecloses Friedman from recovering his fee: the offending clauses are not at issue here. Hence, this is not a case where an attorney is seeking to recover fees under a void provision in a contingent fee agreement. Cf. King v. Young, Berkman, Berman & Karpf, P.A., 709 So.2d 572 (Fla. 3d DCA 1998)(attorney can’t recover under “bonus fee” clause as it violates Florida Bar Rules prohibition against contingent fees in divorce cases). See Chandris, S.A. v. Yanakakis, 668 So.2d 180 (Fla.1995)(attorney fee agreement void as non-Florida lawyer lacked capacity to contract to represent Florida litigant). In this case, Friedman seeks to recover under the contingent fee clauses of the agreement, which are not infirm. We will not hold that the inclusion of the unenforceable terms voids the entire contract. See King, 709 So.2d at 574 n. 2 (“illegal terms may be refused enforcement without wholly avoiding the contract.”).

 

We believe this result follows from the dictates of Chandris. The Chandris Court addressed the validity of a contingent fee agreement executed by a non-Florida lawyer. The Court declared that agreement void because a non-Florida lawyer lacks the capacity to represent clients in Florida. That is not the case here. The contingent fee clauses in Friedman’s agreement do not violate the rules governing contingent fees, as cautioned by Chandris, 668 So.2d at 185-86.2 Although the non-complying clauses on other matters are unenforceable, they do not render the agreement void. Therefore, the offending provisions may be severed allowing for enforcement of the agreement. See King, 709 So.2d at 574 n. 2. Thus, we affirm the award of Friedman’s fee under the agreement.

 

[2] [3] We next address the issue of whether Eidson and Turner may partake in the contingent fee. Under Florida law, an attorney who has no contingent fee agreement with a client is only entitled to recover on a quantum meruit basis. Chandris, 668 So.2d at 186 n. 4; Searcy, Denney, Scarola, Barnhart & Shipley, P.A. v. Poletz, 652 So.2d 366 (Fla.1995). Hence, in this case, where Lackey never signed any agreement with Eidson and Turner, quantum meruit is the only recourse available to them. However, the record demonstrates that there is insufficient evidence to support the amount awarded by the trial court as a quantum meruit award. Eidson’s testimony did not *1189 specify the time he expended on the case or his hourly rate. Turner did not appear at the hearing and was not represented. In Searcy, the Court held that a trial court must consider the amount of time the attorneys devoted to the representation and a reasonable hourly rate as factors in computing an award, as well as the totality of the circumstances surrounding the client/lawyer relationship in awarding fees. Searcy, at 369; Frank J. Pepper, Inc. v. Vining, 783 So.2d 1160 (Fla. 3d DCA 2001). Here, although the trial court considered the latter, there was no testimony as to the former factors. We therefore reverse the portion of the order awarding fees to Eidson and Turner.3 On remand, the court must hold an evidentiary hearing to take testimony on the Searcy factors sufficient to support an award.

 

Based on the foregoing, we affirm the award to Friedman, reverse the award to Eidson and Turner, and remand for further consistent proceedings.

 

All Citations

855 So.2d 1186, 28 Fla. L. Weekly D2306

 

 

Footnotes

 

1

 

Turner and Eidson were involved in the federal multi-district litigation against Ford Motor Company.

 

2

 

The Chandris requirements for contingent fee agreements are found at R. Regulating. Fla. Bar 4-1.5(f).

 

3

 

We are not persuaded that Turner is barred from partaking in the fee by virtue of the fact that he is a non-Florida attorney. Chandris states that “a non-Florida attorney can join with a Florida attorney in a joint representation of a client in Florida on the basis of a contingent fee agreement that complies with the rules.” Chandris, 668 So.2d at 186. That is the situation here, as Friedman’s contingent fee agreement is enforceable.

 

 

 

 

 

 

End of Document

 

© 2016 Thomson Reuters. No claim to original U.S. Government Works.

 

 

 

 

 

 

 

850 So.2d 600

District Court of Appeal of Florida,

Fourth District.

Nancy MURPHY as Natural Mother and Guardian of Carlee Murphy, a minor, Appellant,

v.

James CENTLIVRE and Brian R. Hersh, Appellees.

No. 4D01-2834.

|

July 9, 2003.

|

Rehearing Denied Aug. 14, 2003.

Mother of minor child injured in automobile accident appealed from order of the Seventeenth Judicial Circuit Court, Broward County, Patti Englander Henning, J., awarding $100,000 to discharged attorney. The District Court of Appeal, Shahood, J., held that trial court abused its discretion in awarding attorney fees.

 

Reversed and remanded.

 

Klein, J., concurred specially with opinion.

 

 

 

West Headnotes (1)

 

 

[1]

 

Attorney and Client

Effect of Premature Termination or Settlement of Action

Attorney and Client

Value of Services or Amount of Compensation

 

 Trial court abused its discretion in awarding $100,000 in attorney fees, based on one-third contingency fee agreement, to discharged attorney, who obtained $300,000 settlement offer for personal injury client, where there was no evidence to support attorney’s claim that he obtained waiver of $75,000 in subrogation liens from healthcare providers, and, furthermore, he expended only 14.20 hours on case during course of 10-month representation; attorney sent correspondence and gathered some of medical records, but failed to communicate settlement offer to his client.

Cases that cite this headnote

 

 

 

Attorneys and Law Firms

*600 Kenneth D. Cooper of Kenneth D. Cooper, P.A., Fort Lauderdale, for appellant.

Brian R. Hersh of Law Office of Brian R. Hersh, Miami, for appellee Brian R. Hersh.

Opinion

SHAHOOD, J.

 

Appellant, Nancy Murphy, as natural mother and guardian of Carlee Murphy, a minor, appeals from a Final Judgment awarding discharged attorney, Brian R. Hersh, $100,000 based on his claim for an attorney’s charging and retaining lien. Based on the evidence, we hold that the trial court abused its discretion and reverse and remand.

 

The underlying facts in this case involved a claim by Nancy Murphy, on behalf of her minor daughter against James Centlivre, for injuries sustained by the minor child when Centlivre lost control of his vehicle and collided with the child and two other juveniles. The child sustained a severe break in her leg, requiring two surgeries and the placement of two lifetime pins in her leg. The accident took place on April 21, 2000.

 

On or about April 27, 2000, Murphy entered into a contingency fee agreement with attorney Hersh to represent the child’s interests following the accident.

 

On December 20, 2000, Hersh served a notice of intent to claim damages pursuant *601 to section 768.76(6), Florida Statutes, upon health providers, Health Options, Inc. and CIGNA Health Care. Hersh asserted that the health care providers, as collateral source providers, would waive any right to subrogation or reimbursement unless they each provided him with a statement asserting payment of benefits and right of subrogation or reimbursement within thirty days of receipt of this notification.

 

On or about February 5, 2001, Hersh received an offer from Centlivre’s liability insurer in the amount of $300,000 to settle the matter, including the mother’s consortium claim. The offer was for $200,000 up front and $100,000 as a structured settlement annuity. In a letter dated February 19, 2001, the insurance adjuster reiterated the offer and noted that she awaited Hersh’s counter-demand. The offer was never conveyed to Murphy. On February 20, 2001, Hersh, by e-mail, was discharged as Murphy’s attorney.

 

On February 21, 2001, Murphy, through her new attorney, filed a lawsuit against Centlivre for negligence and punitive damages. On that same day, Hersh served a notice of intent to impose a retaining and charging lien upon Murphy and the insurer as “the result of the work, labor and efforts, as well as results achieved ($300,000.00 offer) in the above-referenced matter.”

 

On May 31, 2001, Hersh filed a Motion for Granting, Imposing, Determining, and Enforcing his Charging Lien and Incorporated Memorandum of Law. In his motion, Hersh claimed that he expended 14.20 hours on behalf of Murphy and her daughter and incurred $2,528.12 in costs. Hersh claimed that he was entitled to attorney’s fees in the matter pursuant to contract or quantum meruit.

 

At the hearing on Hersh’s motion to impose a retaining and charging lien and Murphy’s motion to strike the lien, Hersh’s expert testified that in addition to the $300,000 offer Hersh was able to obtain from the insurer, Hersh was able to waive subrogation claims in the amount of $75,000 from the health care providers.

 

In finding in favor of Hersh, the trial court concluded that Hersh was able to waive the subrogation liens of the health providers with a benefit totaling $75,000. Further, the court held that Hersh obtained a $300,000 offer of settlement from the insurer with a note for a counter-offer. Before a counter-offer could be made, Murphy discharged Hersh. Because the contract between Murphy and Hersh called for a one-third contingency, Hersh was entitled to $100,000 as a quantum meruit award for his services.

 

Following Murphy’s appeal of this matter to this court, Murphy moved this court to relinquish jurisdiction in order to allow the trial court to hear her motion to vacate the final judgment based upon new evidence; said motion was granted April 15, 2001. On September 21, 2001, Murphy moved for rehearing based upon new evidence or mistake to vacate final judgment. Murphy claimed that the deposition taken of the Health Options representative after the hearing revealed that it had a lien of only $10,357.30 and that it never claimed a lien of over $75,000. The representative stated that there were no negotiations between Health Options and Hersh regarding the reduction of any lien. Moreover, Murphy argued that Health Options filed a memorandum in court stating that its policy was an ERISA plan, and that the notice sent to it pursuant to Florida statute had no effect upon its right to recover its lien. Thus, Hersh’s claim that he waived such claims was incorrect and untruthful.

 

Murphy also took the deposition of the CIGNA representative, who stated that *602 the lien amount it was claiming was $4,861.77.

 

Despite this new evidence, the trial court denied Murphy’s motion for rehearing on the amount of attorney’s fees. This was error.

 

In Searcy, Denney, Scarola, Barnhart & Shipley, P.A. v. Poletz, 652 So.2d 366 (Fla.1995), the Supreme Court of Florida set out the proper criteria for determining the quantum meruit recovery of an attorney discharged without cause prior to resolution of the client’s case. See also Rosenberg v. Levin, 409 So.2d 1016 (Fla.1982)(an attorney is entitled to the reasonable value of the services rendered on the basis of quantum meruit, but recovery is limited to the maximum fee set in the employment contract). Under the Searcy standard, the court must consider several factors in determining a quantum meruit award, taking into account the value of the services to the client. See Searcy, 652 So.2d at 369. The court recognized that the time reasonably devoted to the representation and a reasonable hourly rate, are factors to consider when determining a proper award. See id. Additionally, the court recognized that several other factors provide guidance in determining a reasonable fee, including the time and labor required, the novelty, complexity and difficulty of the issues involved, the likelihood that acceptance of the case will preclude other employment, the customary rate charged in the locality, the significance of or amount involved in the representation and result obtained, special demands or time limitations, the nature and length of the professional relationship with the client, the reputation and experience of the attorney, and whether the fee is fixed or contingent. See id. at 369 n. 4; see also Frank J. Pepper, Inc. v. Vining, 783 So.2d 1160, 1163 (Fla. 3d DCA 2001); R. Regulating Fla. Bar 4-1.5. The determination as to which factors are relevant in a given case, the weight to be given each factor and the ultimate determination as to the amount awarded are matters within the sound discretion of the court. See Searcy, 652 So.2d at 369.

 

In this case, it is apparent that the trial court gave great weight to the “results obtained” by Hersh, namely, Hersh’s claim that he obtained a waiver of $75,000 in subrogation liens from the healthcare providers and the $300,000 offer of settlement obtained from the insurance company. Other than this one factor, it does not appear from the order itself that the court considered any other Searcy factors in arriving at a determination as to the amount to be awarded Hersh.

 

As to the “results obtained” factor, the court’s findings are unsupported by the evidence. There is no evidence whatsoever to support Hersh’s claim that he saved Murphy $75,000 in subrogation liens from either Health Options or CIGNA. The record evidence shows that in February 2001, Hersh was notified by Health Options that it was seeking, by virtue of its subrogation clause under its ERISA plan, benefits in the amount of $10,357.30. Its representative testified that its lien amount was never more than the $10,357.30 and that there were never any negotiations with Hersh regarding the reduction of its lien.

 

Hersh also claims that in addition to the Health Options lien, he “wiped out” a CIGNA health insurance lien of “approximately $75,000.” This claim is also unsupported by any record evidence. The CIGNA representative, deposed after the hearing, testified that CIGNA was claiming a lien of only $4,861.77. Thus, assuming that Hersh is entitled to any credit for “wiping out” these liens, the maximum amount for which he would be entitled to credit is $15,219.07, not the $75,000 claimed by Hersh and found by the trial court.

 

*603 The record in this case shows that during the 10 months in which he had the case, Hersh expended only 14.20 hours. At most, Hersh sent some correspondence, gathered some, but not all medical records, and failed to communicate a settlement offer to his client. In the complete absence of record evidence to support the trial court’s findings, we reverse. We remand with directions to set as compensation for Hersh the 14.20 hours expended at a reasonable rate for like attorneys in the community.

 

REVERSED AND REMANDED.

 

GROSS, J., concurs.

KLEIN, J., concurs specially with opinion.

 

KLEIN, J., concurring specially.

 

I agree entirely with the majority opinion. I am writing separately to call the Florida Bar’s attention to the misrepresentation of fact made by attorney Brian Hersh in regard to his obtaining a benefit to the client of the waiver of subrogation liens totaling $75,000. When he first made this representation Mr. Hersh had no basis, so far as this record shows, for making it. He repeated it even after the alleged lienor testified that the lien would have been no more than $10,357.

 

Mr. Hersh has continued to misrepresent what he accomplished for the client to this court. On page two of appellee’s brief, under the statement of the facts, he states:

As a direct result of Appellee’s actions, the Plaintiffs’ recovery will not be subject to approximately $75,000 in subrogation claims.

This misrepresentation was repeated in the summary of argument and argument sections of appellee’s brief.

 

The Comment to Florida Rule of Professional Conduct 4-3.3, which provides that lawyers shall not knowingly make false statements of material facts or law to a tribunal, indicates that the primary goal of this rule is to limit counsel in presenting the client’s case. What Mr. Hersh did in this case is, in my opinion, even more egregious than the type of misrepresentation contemplated by the rule, because this misrepresentation was made solely for the purpose of enriching Mr. Hersh, at the expense of his former client.

 

All Citations

850 So.2d 600, 28 Fla. L. Weekly D1600

 

 

End of Document

 

© 2016 Thomson Reuters. No claim to original U.S. Government Works.

 

 

 

 

 

 

 

750 So.2d 33

District Court of Appeal of Florida,

Fourth District.

Les A. KUSHNER, as Co-Personal Representative of the Estate of Siegbert Daniel, Appellant,

v.

ENGELBERG, CANTOR & LEONE, P.A., Appellee.

No. 98-0403.

|

March 17, 1999.

|

Opinion Granting Motion for Clarification May 19, 1999.

Personal representative of estate appealed decision of Fifteenth Judicial Circuit Court, Palm Beach County, John D. Wessel, J., awarding fees to attorneys discharged for cause. The District Court of Appeal, 699 So.2d 850, reversed, and remanded for determination of quantum meruit amount due to discharged attorneys. Following remand, the Circuit Court, Wessel, J., calculated amount due, and personal representative appealed. The District Court of Appeal, Warner, J., held that trial court would be required, on remand: (1) to consider totality of circumstances, and (2) to determine amount of time personal representative spent, in his capacity as attorney for estate.

 

Affirmed in part; reversed in part; remanded.

 

 

 

West Headnotes (6)

 

 

[1]

 

Attorney and Client

Premature Termination of Relation

 

 In calculating attorney fees in quantum meruit for law firm discharged for cause from representation of estate, trial court would be required, on remand, to consider totality of circumstances, including statutory percentage fees, time actually spent by attorneys and paralegals providing services to estate, and fees contracted to by parties. West’s F.S.A. § 733.6171(4).

1 Cases that cite this headnote

 

 

 

[2]

 

Attorney and Client

Premature Termination of Relation

 

 Proper basis for compensating attorney discharged for cause is, quantum meruit value of services rendered less any damages which client incurred due to attorney’s conduct and discharge.

1 Cases that cite this headnote

 

 

 

[3]

 

Attorney and Client

Premature Termination of Relation

 

 Trial court must look to totality of circumstances in awarding appropriate quantum meruit fee to attorney discharged for cause. West’s F.S.A. § 733.6171(3).

Cases that cite this headnote

 

 

 

[4]

 

Executors and Administrators

Services of Attorneys

 

 Attorney who also acts as personal representative in estate may still be entitled to his attorney’s fees despite his waiver of compensation for acting as personal representative.

Cases that cite this headnote

 

 

 

[5]

 

Attorney and Client

Appeal or Error

 

 In calculating attorney fees in quantum meruit for law firm discharged for cause from representation of estate, trial court would be required, on remand, to determine amount of time personal representative spent, in his capacity as attorney for estate, to complete work which should have been done under contract with discharged firm, even though personal representative had waived right to compensation for acting as personal representative.

1 Cases that cite this headnote

 

 

 

[6]

 

Appeal and Error

Errors Existing, But Not Presented or Considered, on Former Review

 

 Issue of whether personal representative of estate was entitled to recover attorney fees incurred in charging lien proceeding was foreclosed, where representative did not raise issue in prior appeal.

Cases that cite this headnote

 

 

 

Attorneys and Law Firms

*34 Nancy W. Gregoire of Bunnell, Woulfe, Kirschbaum, Keller, Cohen & McIntyre, P.A., Fort Lauderdale, for appellant.

Jerald C. Cantor of Engelberg, Cantor & Leone, P.A., Hollywood, for appellee.

 

WARNER, J.

 

This is an appeal of an order awarding attorney’s fees for work performed in connection with the administration of an estate. Appellant claims that the court’s findings are not supported by the evidence and that the court erred in failing to reduce the fee award by the damages the firm caused the estate. We agree and reverse.

 

Appellee (the “Firm”) represented the estate of Daniel Siegbert, valued at over $8,000,000 and consisting of securities, interests in partnerships and brokerage accounts. Appellant, Kushner, a member of appellee’s firm at the time, was also appointed as a personal representative of the estate. The fee agreement provided that the personal representatives of the estate would pay appellees $150,000 and an additional $30,000 upon completion of an IRS audit of the estate’s tax return or upon receipt of a tax closing letter. It was undisputed that the Firm was paid the $150,000. During the pendency of the administration of the estate, Kushner’s affiliation with the Firm was terminated. Soon after, the estate fired the Firm for cause prior to receiving the tax closing letter. Since the majority of the work was complete, the Firm sought to ensure payment *35 by filing a charging lien, claiming it was owed $30,000 under the fee agreement.

 

A hearing was held on the matter at which evidence was taken as to the value of the Firm’s services. The court made findings and determined that the Firm was entitled to the remaining $30,000 due under the contract, with a deduction for fees expended to actually close the estate. In addition, the court found that the personal representatives were justified for terminating the Firm for cause. On appeal of that order, this court held that the trial court erred in its award of contractual fees because an attorney discharged for cause is only entitled to the quantum meruit value of the services rendered, less any damages caused. See Kushner v. Engelberg, Cantor & Leone, P.A., 699 So.2d 850, 851 (Fla. 4th DCA 1997) (“Kushner I ”). The case was then remanded back to the trial court for a determination of the quantum meruit amount due.

 

The court ultimately entered an order determining the quantum meruit value of the Firm’s services. The court found that the Firm had expended 1,671 hours, but that an additional 50 hours were necessary to close the estate at the time the Firm was terminated for cause. Based on the expert testimony, the court determined that the quantum meruit value of the fee would be $334,200, and the value of the incomplete work would be figured at the rate of $200 per hour. Therefore, because the amount due to the Firm exceeded the $180,000 contract fee, the Firm could only collect on the full contract, less the $10,000 in fees necessary to complete the estate, resulting in a fee of $170,000 (meaning that the estate still owed the Firm $20,000).

 

[1] Appellant contends that the record does not support the trial court’s finding that the Firm had expended 1,671 hours. The record reflects that attorney Engelberg estimated that he spent approximately 700 hours on the estate; Slaughter, a paralegal, expended around 200 hours; Kushner worked at most 200 hours on the estate while employed by the Firm; and that additional members of the Firm spent around 40 hours on the estate. However, it is also clear that the trial court did not believe Engelberg’s testimony, as the order states “[t]he Court is convinced that the majority of the work was done by Kushner, and other staff members of the Law Firm, including a legal assistant.” Given these findings, it is impossible to find support in the record for the court’s conclusion that the Firm expended 1,671 hours on the estate.

 

[2] As we stated in Kushner I, the proper basis for compensating an attorney discharged for cause is, “the quantum meruit value of the services rendered less any damages which the client incurred due to the attorney’s conduct and discharge.” 699 So.2d at 851. In Searcy, Denney, Scarola, Barnhart & Shipley, P.A. v. Poletz, 652 So.2d 366, 369 (Fla.1995), the supreme court explained that a quantum meruit award:

must take into account the actual value of the services to the client. Thus, while the time reasonably devoted to the representation and a reasonable hourly rate are factors to be considered in determining a proper quantum meruit award, the court must consider all relevant factors surrounding the professional relationship to ensure that the award is fair to both the attorney and client.

 

(citation omitted). The court also pointed to the factors set forth in rule 4-1.5(b) of the Rules Regulating The Florida Bar, as a “good starting point” for those considerations. Id. The court observed that in Searcy, the trial court erred as a matter of law in failing to consider the totality of the circumstances present in the case and relying only on hours and hourly rate to compute the fee. See id. Nevertheless, hours and hourly rate are the first factors to be considered. See R. Regulating Fla. Bar 4-1.5(1); Florida Patient’s Compensation Fund v. Rowe, 472 So.2d 1145, 1150 (Fla.1985). Indeed, “[d]etermining a reasonable hourly rate for an attorney for a *36 particular type of legal service and the number of hours that should be expended by the attorney in providing those services is an appropriate starting point for the computation of a reasonable fee in estate proceedings….” In Re Estate of Platt, 586 So.2d 328, 335 (Fla.1991). Here, the hours and hourly rate do not support the fee awarded.

 

Appellee points to section 733.6171(3), Florida Statutes (1993),1 as support for its award, noting that the percentage of the estate calculation which the statute allows as a reasonable fee would be in excess of $240,000 for an estate of this size. However, in this case the parties did not contract for the statutory fee. Their contract called for a fee substantially less. Thus, for purposes of determining a fair fee between the attorney and client in this case, we do not think the considerably larger statutory fee compels the court to determine that the lower contract fee is necessarily a fair fee to be paid under the totality of the circumstances where the parties negotiated without reference to the percentage fee. Cf. In re Estate of McQueen, 699 So.2d 747, 752 (Fla. 1st DCA 1997). Additionally, the statute sets forth only “presumed” reasonable compensation. See § 733.6171(3). It also authorizes a trial court to consider the totality of circumstances of the representation to determine reasonable compensation in any given estate. See § 733.6171(4).

 

[3] We think that the trial court must look to the totality of the circumstances in awarding an appropriate fee. The trial court made a finding that much of the work done on the estate was performed by a highly skilled paralegal and by the co-personal representative. The paralegal’s time amounted to 150-200 hours, with a like amount attributed to Kushner. At their hourly rates the hourly fee would be less than half of the contract fee. This factor must be weighed against the other factors to determine what is a fair fee. While the percentage fee is one other factor to be considered, where a firm is discharged for cause it may not necessarily be entitled to a substantial bonus over its time and effort simply because the statute allows for a significantly higher fee. These factors must all be balanced on remand.

 

[4] [5] Appellant also claims that the trial court erred in failing to reduce the fee award by the damages caused by the amount of work he had to perform after the Firm refused to complete the necessary work to close the estate. Although appellant agreed not to take a fee for his services as personal representative, an attorney who also acts as a personal representative in an estate may still be entitled to his attorney’s fees despite his waiver of compensation for acting as a personal representative. See In re Estate of Good v. Sitomer, 696 So.2d 876, 877 (Fla. 4th DCA), rev. denied, 705 So.2d 8 (Fla.1997). We therefore reverse and remand for the court to determine the amount of time reasonably spent by Kushner in his capacity as an attorney for the estate, to complete the work which should have been done under the contract with appellees.

 

We affirm as to the remaining issues raised by appellant.

 

Reversed in part; affirmed in part and remanded for further proceedings, including such further evidentiary hearings on the issue of damages as the court may deem necessary.

 

TAYLOR, J., and OWEN, WILLIAM C., Jr., Senior Judge, concur.

 

ON MOTIONS FOR CLARIFICATION

WARNER, J.

Appellant and appellee have both requested clarification on the issue of damages *37 which the estate may claim against the appellee on remand. In its order, the trial court deducted only $10,000 for work not yet competed. As an issue on appeal, appellant claimed that the estate had damages which also included: 1) fees paid for work performed by the personal representative; 2) fees paid for services to the beneficiaries’ attorney to fight any fee request by the co-personal representative; and 3) attorney’s fees incurred in the charging lien proceedings and the appellate fees incurred in the previous appeal. In our initial opinion, we addressed only the first claim and not the remaining two.

 

With respect to the fees paid for services to the beneficiaries’ attorney to contest the co-personal representative’s possible fee request, there is nothing in the record to suggest that the co-personal representative ever requested a higher fee. Moreover, appellant has cited no law to convince us that appellee somehow violated his duty to the personal representative by advising the co-personal representative, whom the appellee also represented, that he may be entitled to a higher fee.

 

[6] As to the fees paid with respect to the litigation over appellee’s charging lien, the original final judgment required each party to bear its own fees and costs. Since appellant did not raise this in the prior appeal, the issue is foreclosed. With respect to the estate’s appellate fees from the first appeal, those do not generally constitute recoverable damages. In Bidon v. Department of Professional Regulation, Florida Real Estate Commission, 596 So.2d 450, 452 (Fla.1992), the supreme court stated:

[a]ctual or compensatory damages are those amounts necessary to compensate adequately an injured party for losses sustained as the result of a defendant’s wrongful or negligent actions. However, the general rule is that attorney’s fees incurred while prosecuting or defending a claim are not recoverable in the absence of a statute or contractual agreement authorizing their recovery.

 

(Citations omitted). Appellant has not provided us with any authority showing that such fees are awardable as damages.

 

Appellant also claims that he should have received an evidentiary hearing on these issues. However, based upon our resolution, he is entitled to a hearing only on the claim for fees paid for work he performed as personal representative.

 

TAYLOR, J., and OWEN, WILLIAM C., Jr., Senior Judge, concur.

All Citations

750 So.2d 33, 24 Fla. L. Weekly D717

 

 

Footnotes

 

1

 

The appellees rely on the 1995 version of the statute. However, in this case, if the fee were calculated by statute, the 1993 statute would apply. See Bitterman v. Bitterman, 714 So.2d 356, 363-64 (Fla.1998), cert. denied, 525 U.S. 1187, 119 S.Ct. 1133, 143 L.Ed.2d 126 (1999).

 

 

 

 

 

 

End of Document

 

© 2016 Thomson Reuters. No claim to original U.S. Government Works.

 

 

 

 

 

 

 

302 Fed.Appx. 901

This case was not selected for publication in the Federal Reporter.

Not for Publication in West’s Federal Reporter See Fed. Rule of Appellate Procedure 32.1 generally governing citation of judicial decisions issued on or after Jan. 1, 2007. See also Eleventh Circuit Rules 36-2, 36-3. (Find CTA11 Rule 36-2 and Find CTA11 Rule 36-3)

United States Court of Appeals,

Eleventh Circuit.

Tamika BADILLO, individually, Paulina Campos, individually, Plaintiffs-Appellees-Cross Appellants,

Nicole Breitfeller, et al., Plaintiffs,

v.

PLAYBOY ENTERTAINMENT GROUP, INC., et al., Defendants,

Richard Stuart Shankman, Litigation Concepts, LC., Claimants-Appellants-Cross Appellees.

No 07-15858

|

Non-Argument Calendar.

|

Dec. 12, 2008.

Synopsis

Background: Discharged attorney appealed from a decision of the United States District Court for the Middle District of Florida granting him quantum meruit attorney fees for services rendered to former clients, who eventually settled their lawsuit. Clients cross-appealed, asserting that no attorney fees were due to be awarded.

 

Holdings: The Court of Appeals held that:

 

[1] evidence supported determination that attorney was discharged for cause, under Florida law, and

 

[2] quantum meruit fee of less than five percent of the settlement proceeds was supported by the totality of the circumstances, under Florida law.

 

Affirmed.

 

See also 2004 WL 1013372, 2006 WL 680649, 2006 WL 752840, and 2006 WL 785707.

 

 

 

West Headnotes (2)

 

 

[1]

 

Attorney and Client

Act of Parties

 

 Determination in fee dispute, that attorney was discharged for cause under Florida law, was supported by evidence that clients lost confidence in him and that this loss of confidence stemmed from his unprofessional behavior.

1 Cases that cite this headnote

 

 

 

[2]

 

Attorney and Client

Under Contract for Contingent Fee

 

 Quantum meruit fee of less than five percent of settlement proceeds was warranted for attorney who was employed under contingency fee contract and was discharged for cause under Florida law, even though he did not keep contemporaneous records to support his fee claims, since this was an adequate assessment of the value of his services considering the totality of the circumstances.

2 Cases that cite this headnote

 

 

 

Attorneys and Law Firms

*902 Arthur W. Tifford, Miami, FL, for Plaintiffs-Appellees-Cross Appellants.

Richard Candelora, Mechanik Nuccio Hearne & Wester, Lutz, FL, Michael J. Bradford, Hamilton Miller & Birthisel, LLP, Tampa, FL, for Claimants-Appellants-Cross Appellees.

Appeals from the United States District Court for the Middle District of Florida. D.C. Docket No. 04-00591-CV-T-30-TBM.

Before EDMONDSON, Chief Judge, CARNES and BARKETT, Circuit Judges.

Opinion

PER CURIAM:

 

**1 Lien-claimant Richard S. Shankman1 appeals the amount of attorneys’ fees awarded by the district court for services rendered to his former clients, Tamika Badillo and Paulina Campos. Badillo and Campos file a cross-appeal contending that no attorneys’ fees were due to be awarded. No reversible error has been shown; we affirm.

 

At the heart of this fee dispute are settlement funds attributable to a lawsuit based on the unauthorized commercial distribution of videos of Badillo and Campos participating in “wet t-shirt” contests during spring break in 2001. Shankman first filed suit against Playboy and others on behalf of Monica Pippin, another spring break participant. Shankman investigated other potential causes of action and claimants; upon discovering images of Badillo and Campos, Shankman met with the women. Badillo and Campos each signed a contingent fee agreement with Shankman on 31 July 2003 and 5 August 2003, respectively, pursuant to which Shankman was to receive 45% of the total recovery. Because Shankman was a relatively inexperienced attorney, he needed the assistance and resources of a seasoned litigator. On 20 August 2003, at Shankman’s behest, Badillo and Campos signed an addendum to the contingency fee agreement that provided that Arthur Tifford would serve as co-counsel and would split the attorneys’ fees equally with Shankman.

 

On 22 March 2004, a complaint and motion for preliminary injunction was filed by Tifford and Shankman on behalf of Badillo and Campos and others. Badillo and Campos terminated Shankman’s employment about one month later. After Shankman’s discharge, Badillo and Campos executed a separate contingent fee agreement with Tifford pursuant to which Tifford would receive 40% of the settlement proceeds. Badillo and Campos, represented by Tifford, entered into a settlement agreement with the Playboy defendants in November 2004.

 

Under Florida law,2 an attorney who performed services on behalf of a client on a contingency fee basis and who is discharged before the contingency is accomplished may recover for services only in quantum meruit. Sohn v. Brockington, 371 So.2d 1089, 1093 (Fla.App.1979). An attorney so discharged without cause is entitled to a fee based on the reasonable value of services rendered not to exceed the maximum fee provided in the fee agreement, *903 Rosenberg v. Levin, 409 So.2d 1016, 1021 (Fla.1982); if the discharge is for cause, forfeiture of some or all of the quantum meruit fee may be appropriate. See Searcy, Denney, Scarola, Barnhart & Shipley, P.A. v. Scheller, 629 So.2d 947, 955 (Fla.App.1993). The trial court must first determine the reasonable value of the services rendered by the discharged attorney, see Kushner v. Engelberg, Cantor & Leone, P.A., 699 So.2d 850, 851 (Fla.App.1997); Searcy, 629 So.2d at 954-55. If the discharge was for cause, the trial court should reduce the quantum meruit award by the amount of damages, if any, suffered by the client. Id. If the client’s damages do not exceed the quantum meruit fee, “the court is then free to consider whether forfeiture of some or all of the quantum meruit fee as already reduced by the client’s damages is appropriate.” Id. The court should look at the totality of circumstances to fashion an award that is fair to both the attorney and the client, Searcy, Denney, Scarola, Barnhart & Shipley, P.A. v. Poletz, 652 So.2d 366, 369 (1995); the balancing of relevant factors and the ultimate determination of the quantum meruit award are matters within the sound discretion of the trial court. Id.

 

**2 With the benefit of extensive briefing, testimony of the parties, consideration of expert testimony and other evidence, and after oral argument, the district court determined that Shankman was discharged for cause: Badillo and Campos lost confidence in Shankman when he fired previous co-counsel, failed to cooperate with Tifford, refused to honor Badillo’s and Campos’s directives about early settlement and media non-involvement, and otherwise behaved unprofessionally. Nonetheless the district court concluded that Shankman’s initial case development (some of which work pre-dated the contingent fee agreements with Badillo and Campos and was done in the earlier-filed Pippin case), his conceptualization of the primary legal theory, his efforts to discover potential defendants involved in the distribution of the videos, and his contribution to Tifford’s early court filings, conferred a compensable quantum meruit benefit.

 

The district court also concluded that Badillo and Campos suffered no offsetting compensable damages as a result of Shankman’s unprofessional conduct. But to the extent that Shankman sought an attorneys’ fee award that, together with the 40% Badillo and Campos were obligated to pay Tifford, exceeded 45% of the recovery, the district court concluded such excess would be unfair and might be considered damages. So, the district court limited Shankman’s fee award to 5% of the settlement proceeds (the difference between the 45% contingency agreement with Shankman and Tifford and the 40% contingency executed with Tifford after Shankman’s discharge). And the district court determined also that a full 5% of the settlement proceeds was unjustified and unsubstantiated in the light of (i) Shankman’s failure to document his hours with billing records; (ii) the reasonable value of Shankman’s services; and (iii) the actual benefit conferred as a result of his services. Upon consideration of the totality of the circumstances, an amount less than 5% was awarded.3

 

Shankman argues on appeal that the district court erred in concluding that he was discharged for cause and in greatly undervaluing the benefit his services conferred on the value of the case. For their part, Badillo and Campos argue that the district court’s award of a quantum meruit fee was arbitrary, failed to consider the totality of the circumstances, and failed to *904 offset damages suffered because of Shankman’s mishandling of the litigation.

 

Both sides agree that we review a district court’s attorneys’ fee award for abuse of discretion; an abuse of discretion occurs if the proper legal standard is not applied or the award is based on findings of fact that are clearly erroneous. See Atlanta Journal and Constitution v. City of Atlanta Dept. of Aviation, 442 F.3d 1283, 1287 (11th Cir.2006); Mutual Service Ins. Co. v. Frit Indus., Inc., 358 F.3d 1312, 1322 (11th Cir.2004). No abuse of discretion has been shown.

 

[1] We see no clear error in the district court’s determination that Shankman was discharged for cause. Review of the record amply supports the court’s finding that Badillo and Campos lost confidence in Shankman and that loss of confidence stemmed from unprofessional behavior on Shankman’s part.

 

**3 [2] And we see no clear error in the district court’s assessment of the value Shankman’s services conferred on the case. Shankman kept no contemporaneous records to support his fee claims; but Florida imposes no absolute requirement that contemporaneous records be maintained. See Brake v. Murphy, 736 So.2d 745, 746 (Fla.App.1999). And, in the context of a quantum meruit recovery-unlike an award of attorneys’ fees to a prevailing party-the conventional lodestar approach does not apply. Instead, the main focus is on the actual value of the services rendered; the time reasonably devoted is relevant but only as one factor in consideration of the totality of the circumstances surrounding the attorney-client relationship. See Searcy, 652 So.2d at 368; Rosenberg, 409 So.2d at 1022.

 

The district court looked to the totality of the circumstances to fashion an award that was fair to both the attorney and his former clients. See Searcy, 652 So.2d at 368. Neither party has advanced sufficient grounds for us to disturb the district court’s sound discretion-exercised after extensive evidentiary proceedings-in crafting the quantum meruit award.4

 

AFFIRMED.

 

All Citations

302 Fed.Appx. 901, 2008 WL 5205632

 

 

Footnotes

 

1

 

Shankman filed suit on behalf of himself and his firm, Litigation Concepts, L.C.

 

2

 

The parties each cite to Florida law as applicable to the fee award.

 

3

 

Confidentiality of the settlement amount was a part of the settlement agreement. We refrain from using dollar amounts to preserve that confidentiality.

 

4

 

Badillo’s and Campos’s claim that additional damages should have been assessed based on the delay in disbursement of settlement proceeds is without merit.

 

 

 

 

 

 

End of Document

 

© 2016 Thomson Reuters. No claim to original U.S. Government Works.