Court Opinion

ID: 4692074
Source: CourtListenerOpinion
Date Created: 2021-06-02 07:04:36.925546+00
Date Added: 2024-06-11T08:05:13.654600
License: Public Domain

FIFTH DIVISION
                           MCFADDEN, C. J.,
               RICKMAN, P. J., and SENIOR JUDGE PHIPPS

                    NOTICE: Motions for reconsideration must be
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                                                                       May 21, 2021

In the Court of Appeals of Georgia
 A21A0341. MCWAY v. MCKENNEY’S, INC. et al.

      RICKMAN, Presiding Judge.

      In this appeal, Floyd McWay challenges the trial court’s order granting his

former attorney’s motion to foreclose an attorney’s lien. McWay contends that the

trial court erred in awarding attorney fees in the excess of the amount sought in his

former attorney’s notice of lien. For reasons that follow, we affirm.

      At the outset, we note that “[t]he validity and enforceability of an attorney’s

lien, and the amount of fees to award the attorney enforcing the lien, are matters for

the trial court to decide.” Tolson v. Sistrunk, 332 Ga. App. 324, 325 (772 SE2d 416)

(2015). “Where the trial court is the factfinder, we construe the evidence in the light

most favorable to support the court’s judgment and will uphold the court’s factual

findings on appeal if there is any evidence to support them.” Id. With respect to
questions of law, however, we employ a de novo standard of review. See Vasile v.

Addo, 341 Ga. App. 236, 240 (2) (800 SE2d 1) (2017).

      Construed in favor of the trial court’s judgment, the record reflects that in

January 2017, McWay entered into a contract for legal services with the law firm of

Morse and Edwards, LLC (“Edwards”) to represent him in connection with claims for

personal injuries resulting from a motor vehicle collision (the “Contract”). The terms

of the Contract provided that, after suit was filed, Edwards would be paid 40% of the

gross amount recovered for McWay. The Contract also addressed payment for

services rendered in the event that McWay terminated the Contract:

      [W]e shall be entitled to payment for services rendered before the date
      of termination. If termination occurs with an offer pending, or after
      settlement or verdict, we shall be entitled to our full percentage of the
      recovery as provided in the attorneys’ fees section above, with the
      understanding that those fees were earned. In the alternative, or in the
      event no offer is pending and there has been no settlement or verdict or
      award, we may elect to charge a reasonable percentage based upon the
      amount of work performed or may elect to receive payment based upon
      the time devoted to the case at an hourly rate of $250.00 for attorneys
      and $100.00 for support staff. In any event, you grant us a lien and
      security interest against any proceeds for all unpaid costs, expenses and
      fees.

                                          2
      During its representation of McWay, Edwards investigated the case, sent a

demand letter with an initial settlement demand of $750,000, consulted with McWay

about a $15,000 pre-suit settlement offer, filed suit on McWay’s behalf, and

conducted written discovery. Edwards also facilitated treatment for McWay’s

injuries, including cervical spine surgery, and subsequently made a pre-mediation

settlement demand of $3,500,000. In October 2018, McWay terminated Edwards’

services. In February 2019, Edwards filed a notice of attorney’s lien in the amount of

$8,263.54.1

      In August 2019, while represented by new counsel, McWay settled the lawsuit

for $800,000. In November 2019, McWay filed a motion for interpleader in which he

asserted that he would not disburse any funds to satisfy the attorney lien of Edwards

without a court order. Edwards subsequently filed a motion to foreclose attorney’s

lien and asserted a lien for fees based on the value of the services rendered to McWay

in an amount to be determined by the court.

      1
        In the notice of lien, Edwards stated that the highest offer of settlement
received during its representation of McWay was $15,000, and, pursuant to the terms
of the Contract, asserted a lien for fees of 40% of that amount or $6,000, plus
expenses of $2,263.54.

                                          3
      Following a hearing, the trial court determined that Edwards was entitled to

$43,200 in attorney fees, which constituted 5.4 % of the overall settlement of

$800,000 or 13.5% of the original contingency fee, plus incurred costs of $763.54.2

The trial court based its ruling on the language of the Contract and awarded what it

considered to be a reasonable percentage based upon the amount of work performed.3

McWay appeals and contends that the trial court erred in its award of attorney fees

because Edwards never made an election for anything more than the amount included

in the notice of attorney lien, which constituted an admission as to the amount of the

lien, and that there was a pending offer at the time of termination that triggered the

Contract provision relied upon in the notice of lien.4

      The attorney lien statute, OCGA § 15-19-14 (b),

      2
          There is no dispute as to the amount of expenses awarded.
      3
       In the alternative, the trial court determined that Edwards was entitled to the
recover the same amount under quantum meruit. Because the Contract contained
express provisions detailing how fees should be determined in the event Edwards was
terminated, Edwards was not entitled to recover under the alternative theory of
quantum meruit. See Gilbert v. Edmondson, 193 Ga. App. 593, 594 (1) (388 SE2d
713) (1989).
      4
        McWay also takes issue with the “value-added” theory for calculating
attorney fees that Edwards relied upon in its brief in support of its motion to foreclose
attorney’s lien, but the trial court did not base its ruling on that theory and we
therefore do not address it here.

                                           4
       confers upon an attorney at law the right to impose a lien upon actions,
       judgments, and decrees for money, and prevents the satisfaction of such
       an action, judgment, or decree until the claim of the attorney for his fees
       is fully satisfied. The lien arises upon the institution of the suit; it is
       fixed as soon as the suit is filed and may not be divested by any
       settlement or contract, it matters not by whom the settlement may have
       been made or attempted. After suit has been filed it can not be settled so
       as to defeat the lien of the attorney for his fees.

(Citations, punctuation, and footnote omitted.) Howe & Assoc. v. Daniels, 280 Ga.

803, 804 (631 SE2d 356) (2006). Where a contingency fee contract provides for an

attorney’s entitlement to fees if discharged by his client before the case ends, the

language of the contract provides the basis for determining the value of the attorney

fee lien. See Jones, Martin, Parris & Tessener Law Offices v. Westrex Corp., 310 Ga.

App. 192 (712 SE2d 603) (2011) (contingency fee contract providing that law firm

was entitled to a “reasonable fee for the work performed up to that time” if the client

dismissed it before the case ended provided basis for determining value of attorney

fee lien).

       1. McWay contends that the trial court erred by applying the Contract provision

that allowed Edwards to elect to charge a reasonable percentage based upon the

                                            5
amount of work performed if no offer was pending at the time of termination. McWay

argues that Edwards never made such an election, but the record belies that argument.

      Based on its review of Edwards’ “pleadings, testimony, evidence and argument

at the hearing,” the trial court found that Edwards had elected to receive payment for

work performed based upon a percentage of the eventual settlement. And that finding

is supported by the record, including Edwards’ motion to foreclose its attorney lien,

affidavits detailing work performed on McWay’s behalf, and hearing testimony and

argument. To the extent that McWay also contends that the evidence did not support

the trial court’s award, we find no merit in that contention. See Jones, Martin, Parris

& Tessener, 310 Ga. App. at 200 (4).

      2. McWay contends that the applicable Contract provision is the one Edwards

relied on in its notice of lien, which states that “[i]f termination occurs with an offer

pending, or after settlement or verdict, we shall be entitled to our full percentage of

the recovery as provided in the attorneys’ fees section above, with the understanding

that those fees were earned.” McWay argues that the evidence does not support the

trial court’s conclusion that no offer was pending at the time of termination. We

disagree.

                                           6
       The highest settlement offer made to McWay while he was represented by

Edwards was a pre-suit offer of $15,000. The trial court specifically found that there

was not an offer pending at the time Edwards was terminated. That finding is

supported by McWay’s testimony that he rejected that offer when it was presented to

him and the fact that Edwards, on McWay’s behalf, demanded $3,500,000 prior to

mediation, after suit had been filed. See Costello Indus. v. Eagle Grooving, 308 Ga.

App. 254, 257 (707 SE2d 168) (2011) (“A subsequent communication by one party

to the alleged contract that varies even one term of the original offer is a

counteroffer,” and a counteroffer acts to reject and nullify the original offer.) (citation

and punctuation omitted). Accordingly, the provision of the Contract addressing fees

payable when termination occurs with an offer pending is not applicable here and

Edwards would not be entitled to recover fees under that provision.

       3. Irrespective of the Contract language, McWay contends that the notice of

lien was an admission in judicio as to the amount of the lien. Again, we disagree.

       Admissions in pleadings are governed by OCGA § 24-8-821, which allows

either party to avail himself or herself of allegations or admissions made in the

pleadings of the other. But a notice of lien is not a pleading and therefore would not

constitute an admission under that statute. See OCGA § 9-11-7 (a) (listing allowed

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pleadings). Thus, Edwards is not bound by the amount included in his notice of lien

as an admission in judicio.5

      4. McWay also contends that Edwards’ claim for any attorney fees in excess

of those claimed in the notice of lien is barred by laches because Edwards did not

seek a greater amount until after a settlement had been reached and monies had been

disbursed. The question of laches was not raised in the lower court, however, and is

not now before us. See Cowart v. Georgia Hosp. Svc. Assn., 135 Ga. App. 45, 46 (2)

(217 SE2d 379) (1975).

      Judgment affirmed. McFadden, C. J., and Senior Appellate Judge Herbert E.

Phipps concur.

      5
        McWay also contends that the notice of lien was admissible as an admission
by a party opponent under OCGA § 24-8-801 (d) (2), but there is no dispute as to the
admissibility of the notice.

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