Opinion ID: 1899541
Heading Depth: 1
Heading Rank: 3

Heading: Count I The Hebert Matter

Text: David Hebert retained an attorney to represent him in a maritime personal injury case. When the case settled in the fall of 1998, Mr. Hebert paid attorney's fees of more than $36,000. Believing this sum to be excessive, Mr. Hebert retained respondent in late September 2000 to assist him in recovering a portion of the fee. Respondent informed Mr. Hebert that his fee in such matters customarily ranged from 40%-50% of the amount recovered, and he presented Mr. Hebert with a contingent fee agreement to that effect. However, Mr. Hebert refused to sign the agreement, as he understood from prior discussions with respondent that the fee would be based upon an hourly rate. On October 2, 2000, respondent faxed Mr. Hebert's former attorney a one-page letter demanding the return of the excessive legal fee: Pursuant to 33 USC § 928, your legal fee in the LHWCA claim . . . is limited to $6,066.27. Any withholding in excess of that amount is a violation of 33 USC § 928(e) and LSBA Rules of Professional Conduct Rule 1.5. You withheld $36,666.67 including expenses that I intend to audit. Please refund $30,000 to this office within five (5) days or I will undertake the appropriate action for recovery, etc. On October 4, 2000, two days after receiving respondent's letter, the attorney refunded $30,000 to respondent on Mr. Hebert's behalf. Respondent paid $17,500 to Mr. Hebert by check drawn on his client trust account dated October 5, 2000, and retained $12,500 as his attorney's fee. Though Mr. Hebert had specifically refused to sign a contingent fee agreement in connection with respondent's representation, the legal fee that respondent collected was approximately 40% of the amount he recovered. Mr. Hebert subsequently retained new counsel and filed both a disciplinary complaint and a civil suit against respondent with respect to the $12,500 fee. Throughout the disciplinary proceeding and the civil litigation, respondent has offered different explanations of his fee arrangement with Mr. Hebert. For example, in a response to the disciplinary complaint dated January 4, 2001, respondent asserted that his fee was not based upon a contingency percentage, but rather was a negotiated fee agreed to by Mr. Hebert and myself. Respondent stated that the $12,500 fee was in his view reasonable and fully earned, considering the unusual nature of the case and his unique experience in the area, the degree of risk involved in the representation, the unexpectedly high and beneficial results to Mr. Hebert, and the fact that he had declined other representation to take and investigate the case. Respondent admitted that he kept no time sheets in connection with the representation. On the other hand, in the civil suit filed by Mr. Hebert, respondent contended that the parties had a contingent fee agreement based upon an oral contract. Respondent also specifically denied Mr. Hebert's allegation that an hourly fee arrangement existed. Nevertheless, when the civil case proceeded to trial in May 2002, respondent introduced a reconstruction of his hourly involvement in Mr. Hebert's legal matter, claiming that he devoted 81 hours to recovering the excessive legal fee. [2] Based on the evidence presented in the civil case, the trial court concluded there was no contingent fee agreement between respondent and Mr. Hebert. The court also found that respondent's $12,500 fee was excessive. The court rejected the reconstructed time sheet prepared by respondent and found that respondent performed services for Mr. Hebert in the range of four to five hours, for which an appropriate fee would be $1,000. Accordingly, the court awarded that sum to respondent, and awarded Mr. Hebert the sum of $11,500, plus legal interest and costs. [3] In August 2002, while the judgment in the civil case was on appeal, a formal hearing was conducted in respondent's disciplinary proceeding. In his opening statement, respondent told the hearing committee that although he has always believed he had a contingent fee arrangement with Mr. Hebert, the Court has ruled that it is not, and my contention right now, it is not. It was based on the number of hours. Respondent further asserted that the number of hours I don't think are much in contention. In its formal charges, the ODC alleged that respondent's conduct violated Rules 1.5 (fee arrangements) and 8.4(a) (violation of the Rules of Professional Conduct) of the Rules of Professional Conduct. The ODC further alleged that respondent failed to report the misconduct of Mr. Hebert's former attorney (charging an excessive fee in the maritime personal injury case), in violation of Rule 8.3(a). Respondent answered the formal charges and denied any misconduct in handling the Hebert matter. Pointing out that the civil case was then still in litigation, respondent stated that the basis of the fee was always clear to Mr. Hebert; that a contingent fee contract was in writing but simply not signed, which contract became a negotiated fee based on hours expended and results obtained; and that he was unaware of any misconduct by counsel that he might have reported to the ODC. At the hearing on the formal charges, Mr. Hebert testified that respondent initially told him that he would charge $100 to $150 per hour to write a demand letter to his first attorney. Respondent later requested that Mr. Hebert sign a contingent fee agreement in connection with this endeavor, but Mr. Hebert declined to do so, emphatically telling respondent that he would not pay him 40% simply to write a letter. Respondent then told Mr. Hebert that they would negotiate a price later. A few days later, after the settlement was received, respondent gave Mr. Hebert a check for $17,500, telling him it was his take. The conversation between Mr. Hebert and respondent continued: I says, We didn't even negotiate a price. I said, What's yours? He says, Forty percent, twelve-five. I says, No. No. I did not agree on that at all. I'm very unhappy, you know, with that. No. And wehe had just calmly told me, Look, David, if you have a problem with that, you know, you just got to do what you got to do, . . . Within two weeks of receiving the $17,500 check, Mr. Hebert filed a complaint against respondent with the ODC. In response to the questions of a hearing committee member, Mr. Hebert denied that respondent ever explained the basis of the $12,500 fee he charged. Mr. Hebert testified that all respondent ever said was that it's just like drilling an oil well or something like that, you know. You're going toone's got to pay for the other, you know. [4]