Opinion ID: 1928027
Heading Depth: 1
Heading Rank: 3

Heading: Lodestar fee calculation

Text: Ginberg contends that the reasonable value of his services is 40 percent of the result obtained. He maintains the trial court erred in applying the lodestar method to determine reasonableness, arguing that an application of the factors in Rule 1.5 of the DISTRICT OF COLUMBIA RULES OF PROFESSIONAL CONDUCT would more accurately determine the true value of his services. We disagree for two reasons. First, the Rule 1.5 factors [10] are almost identical to the factors that are used in the lodestar method of fee calculation, [11] see Johnson, supra, 488 F.2d at 717-19, and the trial court properly applied those factors. See Frazier v. Franklin Inv. Co., 468 A.2d 1338, 1341 n. 2 (D.C.1983) (the Johnson factors are applicable to the assessment of attorneys' fees in general). Thus, Ginberg's contention that the court erred as a matter of law in applying the lodestar method is without merit. Second, we find it ironic that Ginberg relies on Rule 1.5 in light of his own failure to abide by other provisions of the same rule that require an attorney to communicate to the client, in writing, the basis or rate of the fee, before or within a reasonable time after commencing the representation. DISTRICT OF COLUMBIA RULES OF PROFESSIONAL CONDUCT Rule 1.5(b) (1985). Because Ginberg kept very few records, the trial court had virtually no guidance in its effort in determining a reasonable fee. For example, as we summarized above, Ginberg had no fee agreement with the client, kept no record of the work performed for the client for over ten years, and sent no interim bills to the client. Even Ginberg's course of dealing with his client provided no guidance in determining a reasonable fee for the Tauber litigation. The trial court had two choices in determining Ginberg's fee: apply an hourly rate based on lodestar, or award Ginberg a fee based on the result of the litigation. A trial court, however, should be wary of awarding a result-based fee unless the attorney seeking such a fee has obtained the client's agreement to that arrangement at the beginning of the representation. See Spilker v. Hankin, 88 U.S.App.D.C. 206, 210, 188 F.2d 35, 39 (1951) (fee contracts entered into long after the attorney-client relationship commenced are always subject to the close scrutiny of the court, ... [and often are] attended by a presumption of invalidity and overreaching); see also Pete v. United Mine Workers of Am. Welfare & Retirement Fund of 1950, 171 U.S.App.D.C. 1, 17, 517 F.2d 1275, 1291 (1975) (en banc) (citing Spilker and invalidating one-third contingency fee agreements with class members solicited after judgment for liability). Thus, because clients are wards of the court in regard to their relationship with their attorneys, Spilker, supra, 88 U.S.App. D.C. at 208-09, 188 F.2d at 37-38, the trial judge properly determined the attorney fee using the lodestar method. [12] Frazier, supra, 468 A.2d at 1341 (lodestar generally used to calculate reasonable attorneys' fees); see also Pennsylvania v. Delaware Valley Citizens' Council for Clean Air, 478 U.S. 546, 565, 106 S.Ct. 3088, 3098, 92 L.Ed.2d 439 (1986) (there is a strong presumption that the lodestar figure represents a reasonable fee); Blum v. Stenson, 465 U.S. 886, 888, 104 S.Ct. 1541, 1544, 79 L.Ed.2d 891 (1984) (same). Therefore, we will not disturb the trial court's selection of the lodestar method, because in the absence of anything more concrete, the benefit has to be given to the client. Frazier, supra, 468 A.2d at 1341 (trial court's fee determination will stand absent abuse of discretion). Based on the expert testimony presented and an independent determination by the trial court of the service provided by Ginberg, the trial court found that Ginberg expended a total of 1411 hours on the case at a rate of $325 an hour. After making the adjustment discussed above, the court awarded Ginberg $389,788.75 in fees. [13] Because that fee award is adequately supported by the trial court's reasoning, and the factual record, see id. (we will not disturb judgment where trial court articulates reasons for fee award), the judgment of the trial court is, Affirmed. WAGNER, Chief Judge, dissenting: In my view, the trial court erred in denying appellant the jury trial guaranteed him by the Seventh Amendment of the Constitution. [1] The pleadings and the record show that appellant's claim involved, not merely equitable rights and remedies, but claims legal in character. Specifically, appellant claimed that appellee had agreed to a result-based fee which depended upon the result obtained rather than being related solely to the hours expended in rendering the services. He contended that his claim that there was such an agreement was supported by a long-term prior course of dealing with appellee, which considered the quality of the result obtained, related correspondence, and appellee's assent to the arrangement in this case. [2] At trial, appellant offered expert testimony to establish a reasonable result-based fee for his services. Having denied appellant a jury trial, the trial court sitting without a jury, resolved the factual dispute as to whether the parties had a value-based agreement against appellant. Such issues as whether there was an agreement, and the terms of the agreement are legal in character, and can, and should be submitted to a jury. Simler v. Conner, 372 U.S. 221, 223, 83 S.Ct. 609, 611, 9 L.Ed.2d 691 (1963) (suit to determine amount of fees owed to lawyer by client under a contingent fee agreement is legal action subject to jury trial); [3] see also Maddox v. Jinkens, 66 App. D.C. 362, 363-64, 88 F.2d 744, 745-46 (attorney is entitled to sue at law upon claimed agreement for fee), cert. denied, 301 U.S. 699, 57 S.Ct. 929, 81 L.Ed. 1354 (1937). The Seventh Amendment question depends on the nature of the issue to be tried rather than the character of the overall action. Ross v. Bernhard, 396 U.S. 531, 538, 90 S.Ct. 733, 738, 24 L.Ed.2d 729 (1970). Thus, where the issue in dispute is legal in nature, a constitutional right to trial by jury attaches. E.R.B., supra note 1, 496 A.2d at 611. The majority, apparently agreeing with these principles, acknowledges that an attorney has the right to have a jury determine (1) whether the client has agreed to pay attorney fees and (2) the manner in which such fees are calculated. [4] These are the very issues which appellant sought to have a jury determine in this case. Under the principles set forth in Simler and Maddox, appellant was entitled to the jury trial for which he made a timely demand. This court's opinion in Kudon v. f.m.e. Corp., 547 A.2d 976 (D.C.1988), upon which the trial court and the majority rely here, does not dictate otherwise. Kudon involved a suit for breach of contract in which the prevailing party sought an award of reasonable attorney's fees pursuant to a provision in the contract sued upon which provided for same. 547 A.2d at 977. Under such circumstances, the award of attorney's fees is incident to the main claim, and viewed as more restitutional in nature, and thus as an equitable claim. Id. at 979 (citing A.G. Becker-Kipnis & Co. v. Letterman Commodities, 553 F.Supp. 118, 124 (N.D.Ill.1982)); see also Cheek v. McGowan Elec. Supply Co., 511 So.2d 977, 979 (Fla.1987) (contractual provision authorizing attorney's fees is not part of the substantive claim because only intended to make the successful party whole). Relying on these and other cases, this court in Kudon determined that the request for attorney's fees in this contractual fee-shifting case was more in the nature of an equitable, rather than a legal, remedy. Kudon, 547 A.2d at 979. Therefore, consistent with the rule that no constitutional right to a jury trial attaches when the issue is equitable in nature, see E.R.B., supra note 1, 496 A.2d at 611, this court rejected the assertion of the right to a jury trial upon the issue. It does not appear that this court had either the intention, or the occasion in Kudon, to reject the jury trial right for an attorney's contractual claim for fees against his client which was upheld by the Supreme Court in Simler, supra, 372 U.S. at 223, 83 S.Ct. at 611, and upheld in this jurisdiction in Maddox, supra, 66 App. D.C. 362, 363-64, 88 F.2d at 745-46. For these reasons, I respectfully dissent from the opinion of the court.