Galanis v. Lyons & Truitt

715 N.E.2d 858 (1999)

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Nature of the Case

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Facts

Brown was injured in an automobile accident. Her first lawyer withdrew because of a conflict of interest and she discharged a second for failure to return phone calls. Brown then retained P to represent her. P took several depositions and prepared for trial over the next two and one-half years. Truitt was appointed to the Superior Court in July of 1993, and Brown discharged P and retained D. Brown signed a written contingent fee agreement providing that D would receive 40% of the gross amount recovered if the case settled or went to trial plus an additional 10% if the case was appealed. The Brown-D agreement made no reference to compensating P for its apparently significant role in the case. D met with P to obtain Brown's file, and P explained that his firm had taken the case under the 1/3 contingency fee arrangement provided in the written agreement between Brown and her first lawyer. Four months after D assumed the case, Brown was successful at trial and a jury awarded her $250,000. The case was then settled for $200,000. P sent D an itemized list of its hours worked and expenses incurred on Brown's case but requested no specific fee. Brown (through D) offered Lyons $4,000 to settle the fee dispute and P requested 1/3 of 1/3 of the recovery or $22,200. The parties could not reach an agreement. P filed a complaint for declaratory judgment against Brown requesting that the trial court determine Brown's obligations under the two contingent fee agreements. Brown filed a cross-claim against D asserting that D, not Brown, was responsible for any fee owing to P. D filed a motion for summary judgment. The court held that P was entitled to a reasonable fee, which was determined to be 'commensurate with the hourly rate charged by an attorney in a similar case,' and that D was responsible for paying that fee. D appealed. The Court of Appeals affirmed. It held that under quantum meruit P is entitled to the reasonable value of its services rendered and (2) D is responsible for paying because holding Brown responsible for both would chill her right to discharge her lawyer. D appealed.