Opinion
No. 30600.
June 12, 1933. Suggestion of Error Overruled July 7, 1933.
1. ATTORNEY AND CLIENT.
Two thousand dollar fee where client agreed to pay attorneys one-third of amount to be recovered from suit in accounting of alleged partnership between client and his brother and when he became beneficiary under brother's will client dismissed appeal from dismissal of accounting suit without attorney's consent, attorneys held inadequate and increased to five thousand dollars.
2. ATTORNEY AND CLIENT.
Amount in controversy is important in considering attorney's fee.
Appeal from the Chancery Court of Adams County.
Brandon Brandon and L.T. Kennedy, all of Natchez, for appellants.
Since ordinarily an agreement for a contingent fee does not give the attorney any interest in the subject-matter of the litigation, any disposition of the case the client chooses to make is binding on the attorney, and if the party dismisses a suit without receiving any consideration the attorney is entitled to nothing under the contract, his remedy being an action for damages or an action upon quantum meruit for the value of services rendered. Where the agreement is for a percentage of the recovery and the client compromises for less than the face of the claim, the attorney is in some jurisdictions entitled only to his proportion of the sum compromised for. The stipulated method of computing the compensation to be paid the attorney for his services must control even though the suit is settled without his consent. In some jurisdictions, however, the entire compensation stipulated for may be recovered in such a case, the client's act amounting to a waiver of complete performance on the part of the attorney.
6 C.J. 745.
It is clear that Seaman Zerkowsky could not take under the will and proceed to prosecute his adverse claim to an one-half interest in all the property or estate which stood in the name of Charles Zerkowsky. He was, therefore, put to an election of his rights and remedies.
West v. West, 131 Miss. 880, 95 So. 739; Waggoner v. Waggoner, 30 L.R.A. (N.S.) 644.
The courts of Texas, Iowa, Kentucky and several other states have adopted the rule that, if the client compromises and settles his case without the consent of his attorneys, then the client has waived complete performance of the contract on the part of the attorney, has prevented the attorney from proceeding with the litigation, and that the attorney is entitled to the entire compensation stipulated for.
3 A.L.R. 472-575; Western States Oil Land Co. v. Helms, 143 Okla. 206, 228 P. 964, 72 A.L.R. 357.
If the true consideration for a settlement is not stated in the release executed by the client, the attorneys are entitled to the agreed percentage of the true consideration and are not bound by that recited in the release.
Whitwell v. Aurora, 139 Mo. App. 597, 123 S.W. 1045; Mytton v. N YC. St. L.R. Co. (Mo. App.), 198 S.W. 189; Note 3 A.L.R., 472-575.
The fact that the offer of one-fourth of the property was made to Seaman Zerkowsky in the will does not change the principles involved from those if such offer had been made by Charles Zerkowsky while living. It was an offer, even though made by will, and was nothing but an offer. It is undisputed that Seaman Zerkowsky accepted the offer by electing to take under the will, without the consent of his attorneys. That by so doing he prevented his attorneys from further proceeding with his adverse claim. He prevented them from fully performing their contract. He waived complete performance on their part, and under one line of decisions, attorneys would be entitled to the fee to be computed upon his claim to an one-half of the estate. On the other hand, if this court adopts the rule that the attorneys would be entitled to have their fee computed upon the amount actually received in settlement, then it would be computed upon an one-fourth of the estate. We are not unmindful that opposing counsel claim that the release sets forth that Seaman Zerkowsky settled his claim for five thousand dollars, yet it is perfectly apparent from the record that Seaman Zerkowsky's adverse claim was not settled for five thousand dollars but was settled for one-fourth of the estate. In other words, the other legatees under the will paid Seaman Zerkowsky five thousand dollars to accept under the will.
Where an attorney is discharged by his client or is otherwise wrongfully prevented from performing the professional duties for which he was employed without fault on the part of the attorney, the latter is entitled to compensation.
Attorneys at Law, 2 R.C.L. 1048; Hall v. Gutter Gutter, 155 Ala. 375, 47 So. 155; Lantrip v. Ivy, 22 Ala. App. 190, 114 So. 12.
A client cannot impair or destroy his attorney's right to a contingent fee.
Ex parte Wilkinson, 220 Ala. 529, 126 So. 102; Attorneys at Law, 2 R.C.L. 1059, 1060.
The court should look to the record in the case wherein the services were rendered for assistance and guidance in estimating the value of the services of the attorney by the amount of labor performed as indicated by the record.
It is submitted that the allowance made by the chancellor was wholly inadequate and insufficient to compensate the attorneys for the vast amount of work done and the value of their services.
L.A. Whittington and Engle Laub, all of Natchez, for appellee.
All of the appellants are well known to the chancellor and he has full information as to the nature, character and value of the services rendered and as to the fees that are usually paid in this community, and as chancellor it has been his duty during these many years to allow fees to all of the attorneys in his district. He is in a better position than anyone else to estimate the value of the services.
Griffith's Chancery, section 465.
We respectfully submit in this case that the appellants are not entitled to a recovery either under the contract or upon a quantum meruit. This court in the case of Zerkowsky v. Zerkowsky, 160 Miss. 278, 131 So. 647, which was litigation in which the parties here were interested, has held that the contract by which the appellant employed his attorney contained no assignment of any interest in the claim against his brother, Charles Zerkowsky, and that same was a mere agreement for the payment of attorneys' fees contingent on a recovery.
This court further held that the appellee here was under no obligation to appeal his case to the supreme court after having lost same in the chancery court and, therefore, following the decision of this court in Lamar County v. Talley Mason, 116 Miss. 588, 77 So. 299; Seaman Zerkowsky had the right to dismiss his appeal.
Since under the contract the appellants here were to receive in the way of fee one contingent upon their recovery, and since they lost the case in the lower court and since this court has held in Zerkowsky v. Zerkowsky, supra, that Seaman Zerkowsky was under no obligation to appeal his case, and, therefore, had the right to dismiss his appeal, and since the record shows, as pointed out in this brief, that this appeal was taken against the wishes of the appellee here and same was practically forced upon him by his attorneys, we, therefore, say that in line with the above decision and in line with what should be the public policy of the state, the circumstances considered, that no recovery of attorneys' fees can be had under the contract.
Lamar County v. Talley Mason, 116 Miss. 588, 77 So. 299; Cochran v. Henry, 107 Miss. 233, 65 So. 213.
To penalize the client by the condition that he must pay a fee in event of dismissal, if such appeal has been taken under such circumstances, would be in effect to nullify his rights and would effectually prevent him in nine out of ten instances from having the benefit of what should be the public policy of the state in such cases.
Under a quantum meruit, if allowed under the facts in this case, there would be no amount due the appellants here.
Where attorney in partition suit was employed on contingent basis, and was prevented from full performance, he was entitled to reasonable compensation only for services rendered before discharge.
Owens v. Bolt, 118 So. 590; 6 C.J. 724; 3 A.L.R. 472; Thole v. Martino (1914), 56 Pa. Super. 371.
The dismissal of a suit to set aside deeds, brought by an attorney under a contract giving him one-fourth of any land decreed to be owned by the client, does not give the attorney a right of action against the client for one-fourth of the value of the land, whatever other right of recovery it may give him.
McPhail v. Spore (1916), 62 Colo. 307, 162 P. 151.
The attorney cannot recover the agreed percentage of the amount which would have been recovered if the action had proceeded.
Andrewes v. Haas, 160 App. Div. 421, 144 N.Y. Supp. 1060; 40 A.L.R. 1538; 3 A.L.R. 489; Carter v. McPherson (1919), 104 Kan. 59, 177 P. 533; Spellman v. Bankers Trust Co., 6 F.2d 799.
A client may at any time for any reason satisfactory to him, however arbitrary, discharge his attorney, and his settlement of the case without consulting his attorney is not a breach of the contract; but the attorney is limited to recovery of the reasonable value of services rendered.
Marquam v. Vachon, 7 F.2d 607; U.S. v. McMurtry, 24 Fed. 2d 145.
An attorney's duty, where he is specially instructed, is to follow the instructions of his client, except as to matters of detail connected with the conduct of the suit, and he is liable for all losses resulting from his failure to follow such instructions with reasonable promptness and care.
6 C.J., Attorney and Client, page 704, section 234; 56 A.L.R. 962.
Argued orally by Gerard Brandon and L.T. Kennedy, for appellant, and by Chas. F. Engle, for appellee.
The appellants, who are attorneys at law, brought this action to recover a fee from the appellee, Seaman Zerkowsky. It appears that the appellee entered into a contract with the appellants, Brandon Brandon, to enforce an accounting in an alleged partnership between the appellee, Seaman Zerkowsky, and his brother Charles Zerkowsky. The theory of the bill for an accounting of the partnership was that there had been a partnership for a number of years between Seaman and Charles Zerkowsky, but that the business had been run in the name of Charles Zerkowsky. The alleged contract of employment of the attorneys, Brandon Brandon, was entered into on December 27, 1926, and provided for a contingent fee of one-third of all money, property, choses in action, and other things of value which said attorneys might recover in said suit for the benefit of Seaman Zerkowsky. It was also provided that Brandon Brandon might associate with them L.T. Kennedy, another attorney, and that the compensation due Mr. Kennedy was to be paid out of the fee allowed to Brandon Brandon. Thereupon, suit was instituted and proceeded to trial, during which it became necessary for Seaman Zerkowsky to amend, in material particulars, his bill; and, accordingly, the case was withdrawn from the court and the amendment allowed. Some two years after, the case again came to trial resulting in a dismissal of Seaman Zerkowsky's bill by the chancery court. An appeal was prosecuted to this court and argued before division B, which remanded it for argument before division A and for decision by the court in banc. Before the case was argued before division A, however, Charles Zerkowsky died, and Seaman Zerkowsky, thereupon, desired to dismiss the appeal, he having been made a beneficiary under the will of Charles Zerkowsky. The attorneys, Brandon Brandon, and L.T. Kennedy, conceiving that they were interested in the subject-matter of the litigation, objected to the dismissal of the appeal, and Seaman Zerkowsky then secured another attorney to secure a dismissal of the appeal in the supreme court.
On consideration of the motion to dismiss, the court, sitting in banc, held that the appellant, Seaman Zerkowsky, had a right to dismiss the appeal regardless of the contract for a contingent fee, which decision is reported in 160 Miss. 278, 131 So. 647. Thereupon, the present suit was filed, seeking to recover of Seaman Zerkowsky one-third of one-half of the estate of Charles Zerkowsky; or, if not entitled to that, then in the alternative, to recover one-third of whatever portion of the estate of Charles Zerkowsky received by Seaman Zerkowsky under the will and settlement; and, if mistaken in that regard, then for a reasonable attorneys' fee.
It appears that while the litigation was pending between Seaman Zerkowsky and his brother, Seaman became ill, and his brother Charles was so attentive and kind, paying all his hospital and medical bills, some two thousand dollars, that Seaman, upon reflection, made up his mind that he would dismiss the appeal and abide by the decision of the chancellor, and so told his brother Charles.
Subsequent to the illness of Seaman Zerkowsky, his brother Charles Zerkowsky made a will leaving to Seaman one-fourth of his property in Mississippi, which was extensive. He also had property in Louisiana which he willed to his niece and nephew, children of his brother, and to another brother, Isaac, willed a one-fourth interest in his Mississippi property. He charged the interest of Seaman Zerkowsky with the amount of hospital and medical bills, two thousand dollars and with three thousand dollars attorneys' fees paid in the litigation in the chancery court. After the death of Charles Zerkowsky, all the other heirs were desirous of adjusting their matters as to his estate, and to avoid litigation, and, to that end, the other heirs agreed with Seaman Zerkowsky that if he would dismiss the appeal in this court, they would release him from reimbursing the estate with the amount of five thousand dollars, attorneys' fees and medical bills.
From the testimony, it appears that the real estate in Mississippi was of the value of ninety thousand dollars, and the personal estate in Mississippi was appraised by the administrator at about eighty-seven thousand dollars; but that the depreciation in securities, such as bonds, mortgages, notes, etc., had reduced the personal estate to about forty-three thousand dollars.
On the hearing, it appeared that Charles Zerkowsky had paid his attorneys in the chancery court a fee of three thousand dollars, or had agreed upon that fee, and had paid one-third of it prior to his death, and that he also employed another attorney to assist his local attorney in the defense of the suit on appeal, and had paid this attorney a fee of one thousand dollars.
The testimony before the chancellor as to what was a reasonable fee on the quantum meruit took a wide range and varied greatly, and the chancellor allowed a fee of two thousand dollars and no more. Some testimony for the appellants placed the fee as high as twenty thousand dollars and some at ten thousand dollars; while a witness for the defendant testified that upon the basis merely of time employed in necessary work, and without taking into consideration the question of the value of the estate, one thousand five hundred dollars would be a reasonable fee.
Of course, in determining what is a reasonable fee, many elements enter into a consideration of the question, one of the chief elements being the amount involved in the controversy.
We have carefully considered all the evidence contained in the record, and have reached the conclusion that the fee allowed by the chancellor was unreasonably low. The testimony in the record as to an attorney regularly employed, not on a contingent basis, but for a fixed sum regardless of results, as bearing upon what is a reasonable fee, is quite convincing in determining what is a reasonable fee. While this is not controlling, it is highly persuasive. Taking this in connection with other facts and opinions, we conclude the fee allowed to be wholly inadequate.
Having all the facts before us, and reviewing the case as though we were the chancery court, and under the authority of the case of Joe Duck Kwong v. Board of Mississippi Levee Commissioners, 144 So. 693, we have decided that five thousand dollars would be a reasonable fee.
Therefore, we affirm the court below as to liability, and reverse and render judgment here as to the amount of attorneys' fees, fixing same at five thousand dollars, and costs.
Affirmed as to liability and judgment rendered as to amount.