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Message
Contingent-fee attorney legal question
Posted on 11/9/22 at 9:26 am
Posted on 11/9/22 at 9:26 am
I was reviewing some files of an older civil settlement. The Family LLC Chairman of the Board stated that "at this point the ownership group did not want to further disrupt destructions of the proceeds to the owners." The terms of the settlement had been agreed. The plaintiff attorney had a conflict with the clients(including me) due to a math error.
Would this attorney been able to legally or ethically delay the settlement because of the fee arrangement calculation conflict?
Would this attorney been able to legally or ethically delay the settlement because of the fee arrangement calculation conflict?
4
Posted on 11/9/22 at 12:22 pm to CharleyLake
I would think it depends on the language in the contract signed
Posted on 11/9/22 at 1:39 pm to HailToTheChiz
Thank you for the response. I think that was the issue. I will research what I have and attempt to be more specific.
Posted on 11/9/22 at 2:02 pm to CharleyLake
If I understand the problem correctly, what should happen is the largest potential contingency fee amount should be placed in trust until issue is resolved and the undisputed portion should go to the clients/ beneficiaries of the recovery.
Posted on 11/9/22 at 3:09 pm to CharleyLake
If the client has agreed it wants to settle, then the attorney cannot in any way fail to communicate that to the other side or fail to proceed with consummating the settlement due to a dispute between the attorney and the client. To do so would 100% be malpractice and should cause the attorney to be disbarred.
The attorney can dispute as between himself and the client how the proceeds from that settlement are to be disbursed, in which case there is a procedure for the attorney and client to resolve that through the state bar association and/or through litigation. I believe (although I'm not 100% certain) that the attorney must distribute to the client the undisputed amount of the settlement.
The attorney can dispute as between himself and the client how the proceeds from that settlement are to be disbursed, in which case there is a procedure for the attorney and client to resolve that through the state bar association and/or through litigation. I believe (although I'm not 100% certain) that the attorney must distribute to the client the undisputed amount of the settlement.
Posted on 11/10/22 at 6:20 am to HailToTheChiz
Indeed, it was the attorney's math error and the ownership group agreed to one less payment (reduced by one annual rental payment.) The value of this payment was reduced by the 60/40 contingency based fee.
The defendant insisted on an updated value based on a survey which was surprisingly in favor of the ownership group. An impasse resulted because our counsel said that the ownership group had agreed a 'hard number' and should not be penalized because of the additional value determined by survey.
The Board of Directors of the Family group voted to accept the settlement calling the additional amount of the lawyers fee "immaterial" (@ $1500.00) but stated that they would not use that attorney again.
The question remains "Did the attorney coerce the ownership to accept his fee increase by suggesting that the proceeds might be delayed." I may never know that answer.
The defendant insisted on an updated value based on a survey which was surprisingly in favor of the ownership group. An impasse resulted because our counsel said that the ownership group had agreed a 'hard number' and should not be penalized because of the additional value determined by survey.
The Board of Directors of the Family group voted to accept the settlement calling the additional amount of the lawyers fee "immaterial" (@ $1500.00) but stated that they would not use that attorney again.
The question remains "Did the attorney coerce the ownership to accept his fee increase by suggesting that the proceeds might be delayed." I may never know that answer.
This post was edited on 11/10/22 at 6:57 am
Posted on 11/10/22 at 9:02 am to CharleyLake
quote:
The Board of Directors of the Family group voted to accept the settlement calling the additional amount of the lawyers fee "immaterial" (@ $1500.00)
Sounds like the disputed amount was relatively small.
quote:
Did the attorney coerce the ownership to accept his fee increase by suggesting that the proceeds might be delayed."
Possibly but it appears that the trust was sufficiently informed.
Posted on 11/10/22 at 10:20 am to CharleyLake
I don't mean this as offensively as it reads, but you're not doing a very good job of explaining what happened.
The decision to settle is made by the client and the attorney must abide by it. The attorney's job is to get the best result possible for his/her client and sufficiently inform his/her client of anything necessary to help the client make an informed decision. It sounds to me that the trust was informed of what's going on and made a business decision not to pursue the matter further.
Contingency fee arrangements must be in writing, so it's likely there is a contract that sets forth the procedure in the event of a fee dispute. It's also possible that the contingency fee agreement contained an arbitration clause. Whatever the case, $1500.00 isn't really worth making a stink over unless you really just hate the attorney and want to file a bar complaint or something.
The decision to settle is made by the client and the attorney must abide by it. The attorney's job is to get the best result possible for his/her client and sufficiently inform his/her client of anything necessary to help the client make an informed decision. It sounds to me that the trust was informed of what's going on and made a business decision not to pursue the matter further.
Contingency fee arrangements must be in writing, so it's likely there is a contract that sets forth the procedure in the event of a fee dispute. It's also possible that the contingency fee agreement contained an arbitration clause. Whatever the case, $1500.00 isn't really worth making a stink over unless you really just hate the attorney and want to file a bar complaint or something.
Posted on 11/10/22 at 4:36 pm to Motorboat
Not a trust. It is a Family Group LLC. I do agree that the BOD was informed.
Posted on 11/10/22 at 5:07 pm to bluemoons
You will get no argument from about my poor explanation of explaining what happened. I am not a lawyer. The decision was made by a three person Board of Directors of the LLC.
My unanswered questions include:
1. Did this attorney make any agreement with defense counsel without the knowledge of his clients?
2. Did this attorney approve written settlement language which did not avoid ambiguities?
I know this to be true- This attorney make conflicting statements regarding the law and its application.
My unanswered questions include:
1. Did this attorney make any agreement with defense counsel without the knowledge of his clients?
2. Did this attorney approve written settlement language which did not avoid ambiguities?
I know this to be true- This attorney make conflicting statements regarding the law and its application.
Posted on 11/10/22 at 9:51 pm to jfw3535
I suspected something like that. Very grateful for you taking time to respond.
Posted on 11/10/22 at 10:22 pm to CharleyLake
quote:
1. Did this attorney make any agreement with defense counsel without the knowledge of his clients?
Hard for us to answer here without more information, but pretty unlikely unless the guy was pretty scummy. Attorneys have a way of talking with opposing counsel that conveys the wants/needs of their clients without actually agreeing to anything.
quote:
2. Did this attorney approve written settlement language which did not avoid ambiguities?
Also impossible to answer. The unfortunate reality of the practice of law is that everything is open to interpretation. Attorneys do the best they can to avoid ambiguities, but it’s impossible to plan for every contingency. That said, settlement/release agreements involving this value range are pretty cut and dry. Not super complicated and not many moving parts.
It really just comes down to what the client representative was informed of and whether the representative made a business decision. It sounds like that’s what happened. Again though, f it’s bothering you I’d try to find a copy of the contingency agreement and take a look at the fee dispute provision if it exists. It may be worth an email to the lawyer if you feel like (a) he/she wronged your entity in some way, and/or (b) you have some leg to stand on worthy of an actual dispute.
Posted on 11/11/22 at 6:00 am to bluemoons
I was simply naturally curious about the fee dispute. My share was small. My term on the Board of Directors had expired and I understand that prudent management is not perfect management. My concern is that the present BOD is weak and allowed this attorney to false and misleading statements at relevant times which encouraged accepting the defendant's terms of settlement throughout this litigation.
This attorney is no longer employed with the law practice and upon my understanding has been with three firms since leaving. As part of the separation agreement this attorney received a percentage of the 40% fee arrangement.
This attorney is no longer employed with the law practice and upon my understanding has been with three firms since leaving. As part of the separation agreement this attorney received a percentage of the 40% fee arrangement.
Posted on 11/11/22 at 7:23 pm to CharleyLake
quote:
"at this point the ownership group did not want to further disrupt destructions of the proceeds to the owners."
Gonna guess that should be distributions.
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