Court Opinion

ID: 4124646
Source: CourtListenerOpinion
Date Created: 2017-02-09 14:15:45.158664+00
Date Added: 2024-06-11T14:36:51.848170
License: Public Domain

This opinion is uncorrected and subject to revision before
publication in the New York Reports.
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No. 2
Jose Marin, et al.,
        Plaintiffs,
        v.
Constitution Realty, LLC, et al.,
        Defendants.
Sheryl Menkes, Esq.,
        Non-Party Appellant,
        v.
David B. Golomb, Esq., et al.,
        Non-Party Respondents.

          Scott T. Horn, for nonparty-appellant.
          Brian J. Shoot, for nonparty-respondent Golomb.
          Jay L. T. Breakstone, for nonparty-respondent
Manheimer.

DiFIORE, Chief Judge:
          Plaintiffs Jose and Ada Marin obtained an $8 million
settlement for serious injuries Jose Marin sustained when he fell
approximately 40 feet while working on a building in Manhattan.
This appeal concerns a fee dispute between plaintiffs' attorney-

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of-record in that action, Sheryl Menkes, and two attorneys she
engaged to assist her:    Jeffrey A. Manheimer and David B. Golomb.
Based on the plain language of their respective fee-sharing
agreements, we conclude that Manheimer is entitled to 20% of net
attorneys' fees and Golomb is entitled to 12% of net attorneys'
fees.    We therefore modify the Appellate Division order
accordingly.
                                 I.
                                 A.
            In February 2009, Menkes engaged Manheimer to act as
co-counsel and provide advice in the action.1   Their written
agreement provided that Manheimer would receive 20% of net
attorneys' fees if the case settled before trial and 25% once
jury selection commenced.    Neither attorney informed the clients
of Manheimer's involvement, although Manheimer believed Menkes
had done so.    The failure to inform the clients violated the
former Code of Professional Responsibility DR 2-107 (a) (22 NYCRR
1200.12 [a]) and the current Rules of Professional Conduct (22
NYCRR 1200.0) rule 1.5 (g).2   In June 2009, the agreement was
amended to specify that Manheimer would act solely in an advisory
capacity and would "not contact the client[s], defendants[']

     1
       Barbara Manheimer appears in this action as Executrix of
the Estate of Jeffrey Manheimer.
     2
       The Rules of Professional Conduct replaced the Code of
Responsibility as the governing rules for attorney conduct in New
York effective April 1, 2009.

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experts or the [c]ourt" without Menkes's permission.     The fee
arrangement was unchanged.    In August 2009, Menkes wrote to
Manheimer unilaterally discharging him and advising him that his
portion of the fees would be determined on a quantum meruit
basis.    Manheimer did not respond to Menkes; he did no further
work on the case.
                                 B.
            In August 2012, Menkes obtained partial summary
judgment on liability under Labor Law § 240 (1) on plaintiffs'
behalf.    She later sought assistance from Golomb for an upcoming
mediation -- scheduled for May 20, 2013 -- and a potential trial
on damages.    In March 2013, Menkes and Golomb entered into a
written agreement, which stated, in relevant part:3
                      "I [Golomb] have agreed to review
            the file, provide whatever services are
            needed, with your and your office's
            assistance, to prepare it for the mediation
            and to handle the mediation. For those
            services, I will be [sic] receive twelve
            (12%) percent of all attorneys' fees whenever
            the case is resolved, whether by settlement,
            verdict after trial or appeal, calculated
            after the attorneys have been reimbursed for
            all expenses laid out. This percentage due
            shall become fixed and owed upon execution of
            this agreement.
                      "If the case does not resolve at
            the mediation, presently scheduled for May
            20, 2013, then I will be responsible, with
            your and your office's assistance as

     3
       Plaintiffs were notified of, and consented to, the
arrangement between Menkes and Golomb. At this time, Menkes also
represented in the agreement that no other attorneys were
participating in the fee.

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           requested, for preparing for trial and trying
           the case. After such mediation, I will be
           entitled to forty (40%) percent of all
           attorneys' fees whenever the case is
           resolved, whether by settlement, verdict
           after trial or appeal, calculated after the
           attorneys have been reimbursed for all
           expenses laid out. In the event this matter
           has to be tried, the total of all attorneys'
           fees to which I am entitled for all of the
           services set forth, including mediation,
           shall be forty (40%) percent of all
           attorneys' fees whenever the case is
           resolved, whether by settlement, verdict
           after trial or appeal, calculated after the
           attorneys have been reimbursed for all
           expenses laid out."
           The mediation began on May 20, 2013 at 2:00 p.m.
Although the parties' original settlement positions were
approximately $17 million apart, by the time the session
concluded at approximately 7:00 p.m., the gap was about $1.5
million.   Since the excess insurance carriers lacked authority to
increase their offer at that time, the mediation session ended
without a settlement agreement.    On May 22, 2013, and during the
following week, the mediator maintained contact with both Golomb
and the carriers.   On May 31, 2013, the mediator telephoned
Golomb to convey a settlement offer of $8 million, which Golomb
accepted on plaintiffs' behalf.    The final terms of the
settlement agreement were memorialized in a June 5, 2013 letter.
                                  C.
           Menkes moved for an order establishing Golomb's
attorneys' fees at 12% of net attorneys' fees and, after
Manheimer intervened, Menkes also moved for an order setting his

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fees on a quantum meruit basis.    Manheimer and Golomb each cross-
moved:   Manheimer to fix his fee at 20% of net attorneys' fees
and Golomb, as relevant here, to fix his fee at 40% of net
attorneys' fees.4
            Supreme Court denied Menkes's motion and granted both
cross motions.    As to Manheimer, Supreme Court held that both the
February and June 2009 agreements unequivocally and unambiguously
entitled Manheimer to 20% of net attorneys' fees.    Supreme Court
rejected Menkes's argument that because plaintiffs were never
notified of and never consented to Manheimer's role as co-
counsel, the agreements were unenforceable.    As to Golomb,
Supreme Court concluded that the plain language of the agreement
provided that Golomb was entitled to 40% of net attorneys' fees
because the case did not settle at the mediation session on May
20, 2013.
            On appeal, the Appellate Division affirmed, with two
Justices dissenting (128 AD3d 505 [1st Dept 2015]).    That Court
unanimously agreed that Manheimer was entitled to 20% of net
attorneys' fees (see id. at 512, 513).   With respect to Golomb,
the Court concluded that the plain language of the agreement
between Golomb and Menkes provided that Golomb was entitled to
40% of net attorneys' fees because: (1) the agreement referenced
"'the mediation,' not the 'process' of mediation," (2) "the

     4
       The balance of Golomb's cross motion is not before us on
this appeal.

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mediation" was defined as the one "'presently scheduled for May
20, 2013,'" and (3) nothing in the agreement "condition[ed]
Golomb's entitlement to the higher fee upon his commencing or
taking any steps to prepare for trial" (id. at 509).
          Two dissenting Justices would have held that the plain
language entitled Golomb to only 12% of the attorneys' fees,
noting that "the mediation," as used in the first substantive
paragraph of the agreement, was not limited to a single date or
session and that the words "presently scheduled for May 20,
2013," were descriptive, not limiting, because they were placed
between commas (id. at 515-516).    According to the dissent, the
Court's analysis failed to give weight to the language requiring
Golomb to "'prepar[e] for trial and try[] the case'" in order to
be entitled to the 40% fee (id. at 515).
          Menkes appealed as of right pursuant to CPLR 5601 (a),
which brings up for our review Menkes's agreements with both
Manheimer and Golomb.
                              II.
          We conclude that Menkes's agreements with Manheimer are
enforceable and entitle Manheimer to 20% of net attorneys' fees.
           Menkes's attempt to use the ethical rules as a sword
to render unenforceable, as between the two attorneys, the
agreements with Manheimer that she herself drafted is unavailing.
Her failure to inform her clients of Manheimer's retention, while
a serious ethical violation, does not allow her to avoid

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otherwise enforceable contracts under the circumstances of this
case (see Samuel v Druckman & Sinel, LLP, 12 NY3d 205, 210
[2009]).   As we have previously stated, "it ill becomes
defendants, who are also bound by the Code of Professional
Responsibility, to seek to avoid on 'ethical' grounds the
obligations of an agreement to which they freely assented and
from which they reaped the benefits" (Benjamin v Koeppel, 85 NY2d
549, 556 [1995] [citation omitted]).   This is particularly true
here, where Menkes and Manheimer both failed to inform the
clients about Manheimer's retention, Menkes led Manheimer to
believe that the clients were so informed, and the clients
themselves were not adversely affected by the ethical breach.
           Menkes's remaining arguments with respect to Manheimer
are either without merit or are not preserved for our review.
                               III.
           As to the agreement between Golomb and Menkes, general
principles of contract interpretation control.   "[A]greements are
construed in accord with the parties' intent" (Greenfield v
Philles Records, 98 NY2d 562, 569 [2002] [citation omitted]).
The best evidence of that intent is the parties' writing (see
id.).   "[A] contract should be 'read as a whole, . . . and if
possible it will be so interpreted as to give effect to its
general purpose'" (Beal Sav. Bank v Sommer, 8 NY3d 318, 324-325
[2007] [citation omitted]).   "[A] written agreement that is
complete, clear and unambiguous on its face must be enforced

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according to the plain meaning of its terms" (Greenfield, 98 NY2d
at 569).   Whether an agreement is ambiguous or unambiguous "is an
issue of law for the courts to decide" (id.).    Here, both parties
maintain that the agreement is unambiguous.
           The plain language of Menkes's agreement with Golomb
entitles Golomb to 12% of net attorneys' fees if the matter
resolved through the mediation that was scheduled to begin, but
did not need to conclude, on May 20, 2013.    That is what occurred
here.
           Two paragraphs of the agreement spell out the fee
arrangement.   The first states that Golomb will "provide whatever
services are needed . . . to prepare [the matter] for the
mediation and to handle the mediation."    "For those services,"
i.e., preparing for and handling the mediation, Golomb will
"receive twelve (12%) percent of all attorneys' fees whenever the
case is resolved."   No specific date or dates are mentioned for
the mediation.
           The subsequent paragraph states that "[i]f the case
does not resolve at the mediation, presently scheduled for May
20, 2013, then [Golomb] will be responsible . . . for preparing
for trial and trying the case.    After such mediation, [Golomb]
will be entitled to forty (40%) percent of all attorneys' fees
whenever the case is resolved."    Although the agreement
references the date of May 20, 2013, the agreement does not
require that the mediation be concluded during a single-day

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session.    Nor was the mediation limited to the specific date
identified in the agreement; rather, the use of commas indicates
that the date was merely descriptive of the mediation, and not
intended to restrict the mediation to that date (see William
Strunk Jr. & E.B. White, The Elements of Style 3-5 [4th ed
2000]).5    The agreement plainly contemplated the fact that many
mediation efforts require multiple sessions or follow-up
conversations before settlement can be achieved.
            Moreover, the next sentence of the Golomb agreement
reads "[i]n the event this matter has to be tried, the total of
all attorneys' fees to which [Golomb will be] entitled for all of
the services set forth, including mediation, shall be forty (40%)
percent of all attorneys' fees whenever the case is resolved."
Thus, the clear intent of the agreement is that the 40% fee will
be triggered only if the matter moves past mediation.
            Here, the mediator and Golomb communicated in the days
following the May 20 mediation session, with the mediator
continuing to act as go-between.    Ten days after the session, the
mediator communicated the final $8 million offer, which Golomb
accepted.    Reading the agreement as a whole, the plain language
of the agreement entitles Golomb to 12% of net attorneys' fees.

     5
       The conflicting opinions below disagreed as to whether
Menkes preserved her argument that the phrase "presently
scheduled for May 20, 2013," offset by commas, was a descriptive
term, rather than a limiting term (see 128 AD3d at 510, 516-517).
We conclude that the argument is properly before us.

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            Accordingly, the order of the Appellate Division should
be modified, without costs, in accordance with the opinion herein
and, as so modified, affirmed.
*   *   *    *   *   *   *   *     *      *   *   *   *   *   *   *   *
Order modified, without costs, in accordance with the opinion
herein and, as so modified, affirmed. Opinion by Chief Judge
DiFiore. Judges Rivera, Abdus-Salaam, Stein, Fahey and Garcia
concur. Judge Wilson took no part.

Decided February 9, 2017

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