Court Opinion

ID: 8212577
Source: CourtListenerOpinion
Date Created: 2022-10-07 14:04:51.725981+00
Date Added: 2024-06-11T16:42:12.167355
License: Public Domain

RENDERED: SEPTEMBER 30, 2022; 10:00 A.M.
                 NOT TO BE PUBLISHED

       Commonwealth of Kentucky
                Court of Appeals

                    NO. 2020-CA-1131-MR

BINGHAM GREENEBAUM DOLL
LLP                                                  APPELLANT

          APPEAL FROM GALLATIN CIRCUIT COURT
v.        HONORABLE JAMES R. SCHRAND, JUDGE
                  ACTION NO. 14-CI-00055

CUT-N-SHOOT LLC AND
MEREDITH L. LAWRENCE                                 APPELLEES

AND

                    NO. 2020-CA-1217-MR

MEREDITH L. LAWRENCE AND
CUT-N-SHOOT, L.L.C.             APPELLEES/CROSS-APPELLANTS

       CROSS-APPEAL FROM GALLATIN CIRCUIT COURT
v.        HONORABLE JAMES R. SCHRAND, JUDGE
                 ACTION NO. 14-CI-00055
BINGHAM, GREENEBAUM, DOLL
L.L.P, D/B/A DENTONS BINGHAM
GREENEBAUM, L.L.P                               APPELLANT/CROSS-APPELLEE

AND

                              NO. 2021-CA-0320-MR

CUT AND SHOOT, L.L.C. AND
MEREDITH L. LAWRENCE                                                 APPELLANTS

                 APPEAL FROM GALLATIN CIRCUIT COURT
v.               HONORABLE JAMES R. SCHRAND, JUDGE
                         ACTION NO. 14-CI-00055

BINGHAM, GREENEBAUM, DOLL,
L.L.P.                                                                  APPELLEE

                             OPINION
     AFFIRMING IN PART AND REVERSING AND REMANDING IN PART

                                   ** ** ** ** **

BEFORE: CLAYTON, CHIEF JUDGE; CALDWELL AND K. THOMPSON,
JUDGES.

CLAYTON, CHIEF JUDGE: Bingham Greenebaum Doll, LLP (“Bingham”)

appeals from the Gallatin Circuit Court’s orders, entered on April 24, 2020, and

August 21, 2020, arguing that the court erred in finding that an attorneys’ fee

                                         -2-
agreement between Bingham and Meredith L. Lawrence (“Lawrence”) for a flat

fee secured by a mortgage on real property failed to comply with Supreme Court

Rule (“SCR”) 3.130(1.8)(a) (“Rule 1.8(a)”).

             Because we conclude that Lawrence was given a reasonable

opportunity to seek the advice of independent legal counsel on the transaction and

that Bingham did not take an interest in Lawrence’s property for more than the

agreed-upon legal fees, we reverse the circuit court’s judgment and remand to

enforce the mortgage held by Bingham. We affirm on cross-appeal.

             Lawrence also filed a direct appeal from various Gallatin Circuit

Court orders entered on December 15 and 16, 2020, and March 2, 10, and 15,

2021, alleging various claims of error. This Court has consolidated Bingham’s and

Lawrence’s appeals. Finding no error as to Lawrence’s direct appeal, we affirm.

              FACTUAL AND PROCEDURAL BACKGROUND

             Litigation between Bingham and Lawrence has reached the Kentucky

Supreme Court multiple times. We turn to the most recent Supreme Court opinion

for a summary of the facts applicable in this matter:

             In 2008, Lawrence retained Bingham attorney J. Richard
             Kiefer to defend him against federal tax-evasion charges.
             At some point in the representation, the parties agreed to
             revise their original fee agreement because Lawrence had
             fallen behind in his payments. The new agreement stated
             that Lawrence would pay a flat fee of no less than
             $450,000 the principal not to exceed $650,000.
             Lawrence agreed to secure his payment with a mortgage

                                         -3-
on real estate he owned, and he signed a promissory note
evidencing his debt.

       Lawrence was convicted of three counts of filing
false tax returns. He then sued Kiefer and Bingham,
among others, in Kenton Circuit Court for legal
malpractice. Because Lawrence had not paid for a
portion of the legal services provided to him, Bingham
filed a counterclaim to recover its fee; specifically,
Bingham sued for enforcement of the promissory note.
The Kenton Circuit Court dismissed Lawrence’s
malpractice claim and granted default judgment to
Bingham on its counterclaim. [The Kentucky Supreme
Court] upheld the judgment. [See Bingham Greenebaum
Doll, LLP v. Lawrence, 567 S.W.3d 127, 131 (Ky. 2018)
(“Lawrence I”)].

       Simultaneously occurring with the Kenton Circuit
Court case, Bingham sued Lawrence in Gallatin Circuit
Court to foreclose on the property Lawrence agreed to
mortgage as security on his debt for Bingham’s services
[(the “Marathon Property”)]. Gallatin County was the
chosen venue for this action because the [Marathon
Property] was situated in that county. Lawrence
counterclaimed for legal malpractice.

       Also occurring simultaneously with the above two
cases was a collateral attack on his conviction that
Lawrence filed in federal court based, in part, on a claim
of ineffective assistance of counsel. The federal court
ruled against Lawrence on his ineffective-assistance-of-
counsel claim and issued its final order before the
resolution of the Kenton and Gallatin cases.

       In the Gallatin Circuit Court foreclosure action,
Bingham moved for summary judgment, which the trial
court granted. Then, upon Bingham’s motion, the trial
court entered an order of sale. After several further
procedural steps, the [Marathon Property] was sold, and

                            -4-
             the sale was confirmed by the trial court on May 30,
             2018.

Lawrence v. Bingham Greenebaum Doll, L.L.P., 599 S.W.3d 813, 819-20 (Ky.

2019) (“Lawrence III”) (footnotes omitted).

             Lawrence appealed the Gallatin Circuit Court’s order confirming the

sale, which was eventually transferred to the Kentucky Supreme Court. Following

briefing, the Supreme Court vacated the summary judgment and remanded the case

to the Gallatin Circuit Court to hear evidence regarding Bingham’s compliance

with Rule 1.8(a). Lawrence III, 599 S.W.3d at 829.

             In its opinion, the Supreme Court said the following: “The only

specific argument Lawrence makes . . . that has possible merit and that is not

barred by claim or issue preclusion is whether Kiefer violated [Rule 1.8(a)] by

taking a possessory interest in Lawrence’s property and by taking a property

interest, the value of which exceeded the fees owed.” Id. at 827. The Court further

stated:

             We find no evidence in the record to resolve the issue of
             whether the “transaction and terms on which the lawyer
             acquires the interest are fair and reasonable to the
             client[.]” Nor is there anything in the record resolving
             the issue of whether Lawrence was “advised in writing of
             the desirability of seeking and [was] given a reasonable
             opportunity to seek the advice of independent legal
             counsel on the transaction.” . . . These are issues that
             must be resolved by the trial court before summary
             judgment can be granted.

                                        -5-
Id. at 828-29.

             On remand, the circuit court held an evidentiary hearing regarding the

Rule 1.8(a) issues raised by the Supreme Court. Kiefer, Lawrence, and their

respective experts testified. In its April 24, 2020, order, the circuit court

acknowledged the Supreme Court’s recent opinion and the prior findings made by

the Supreme Court. As for the remaining Rule 1.8(a) questions, the circuit court

found that (1) the transaction and terms were fair and reasonable to Lawrence per

Rule 1.8(a)(1); (2) Kiefer had advised Lawrence in writing of the desirability of

seeking the advice of independent legal counsel on the transaction per Rule

1.8(a)(2); and (3) it could not make a summary judgment decision as to whether

Lawrence was given a reasonable opportunity to seek the advice of independent

legal counsel per Rule 1.8(a)(2). For this last question, the circuit court reasoned

that “negotiations” were ongoing immediately prior to the pending June 2012 trial.

             The circuit court also found that Bingham took a security interest in

an amount greater than the legal fees and expenses owed. The court based its

holding on language in the promissory note that accounted for the possibility that

Lawrence could owe up to $650,000 in fees if the trial was continued for four

months or more and language in the mortgage referencing that the highest

aggregate amount which the mortgage could secure was $1 million.

                                          -6-
            With these holdings, the circuit court denied Bingham summary

judgment, vacated the prior orders regarding the sale and confirmation of sale of

the Marathon Property, and ordered the Special Master Commissioner to deed the

Marathon Property back to Lawrence. The circuit court also made its order final

and appealable.

            Bingham timely filed a Kentucky Rule of Civil Procedure (“CR”)

59.05 motion to alter, amend, or vacate. In its motion, Bingham argued that,

because the Supreme Court remanded the case to the circuit court for it to resolve

genuine issues of material fact, the circuit court should have weighed the evidence

and testimony presented at the hearing in accordance with the preponderance of the

evidence standard and should not have continued to employ the summary judgment

standard, as no such motion was pending. Bingham further argued that it did not

take a possessory interest in the Marathon Property for more than the agreed-upon

fee and that Lawrence had been given reasonable time to consult an attorney in

compliance with Rule 1.8(a).

            Lawrence did not file a CR 59.05 motion concerning the April 2020

order or otherwise contest the Marathon Property being deeded back to him at that

time.

            The circuit court denied the motion to alter, amend, or vacate in part,

but also added the following language in its order: “[B]ased on the testimony and

                                        -7-
evidence presented at the Hearing, as well as argument from counsel, the Court

finds Bingham took a possessory interest in the Marathon Property for more than

the agreed-upon fee, and that Lawrence was not given a reasonable time to consult

with independent counsel.” Thereafter, Bingham filed this appeal.

             We will discuss more facts as they become relevant herein.

                                      ANALYSIS

             a. Bingham’s Appeal

                    1. Appealable Order

             We first note Lawrence argues that Bingham’s appeal is improper

because it is from an interlocutory denial of a summary judgment. Bingham

contends that the circuit court’s order is final and appealable because it contained

the recitations necessary under CR 54.02 regarding a judgment upon multiple

claims or involving multiple parties.

             As stated by a panel of this Court, “[i]t is well settled in this

Commonwealth that the denial of a motion for summary judgment is interlocutory

and is not appealable.” Roman Catholic Bishop Of Louisville v. Burden, 168

S.W.3d 414, 419 (Ky. App. 2004) (citations omitted). Generally, the denial of

summary judgment is not “a final adjudication upon one or more of the claims in

litigation . . . [nor does it] conclusively determine the rights of the parties in regard

to that particular phase of the proceeding.” Hale v. Deaton, 528 S.W.2d 719, 722

                                           -8-
(Ky. 1975). Instead, “[a]n order denying a motion for summary judgment

ordinarily does not finally adjudicate anything, as the party whose motion was

denied may still prevail at trial.” Medcom Contracting Services, Inc. v.

Shepherdsville Christian Church Disciples of Christ, Inc., 290 S.W.3d 681, 684

(Ky. App. 2009) (citation omitted).

             However, the order in this case not only denied Bingham summary

judgment but also vacated two prior orders of sale and ordered that the Special

Master Commissioner prepare a deed for the Marathon Property back to Lawrence.

Thus, because Kentucky Rules of Civil Procedure 54.01 defines a “final or

appealable judgment” as “a final order adjudicating all the rights of all the

parties[,]” and the circuit court’s order disposed of and adjudicated all the rights of

all the parties regarding that particular phase of the proceeding, “the result of the

. . . order left nothing to adjudicate regarding the rights and priorities of the

parties.” Security Federal Sav. & Loan Ass’n of Mayfield v. Nesler, 697 S.W.2d

136, 138-39 (Ky. 1985). Therefore, we will proceed with a review of Bingham’s

arguments on appeal.

                    2. Standard of Review

             Before discussing the appropriate standard of review in this case, we

note that, while the circuit court stated that it was denying Bingham’s motion for

summary judgment, the circuit court also held an evidentiary hearing and made

                                           -9-
findings of fact in its orders. Our standard of review concerning a court’s findings

of fact made during an action tried upon the facts without a jury is outlined in CR

52.01, which provides that “[f]indings of fact, shall not be set aside unless clearly

erroneous, and due regard shall be given to the opportunity of the trial court to

judge the credibility of the witnesses.” Under Kentucky law, a factual finding is

clearly erroneous if it is not supported by substantial evidence. Moore v. Asente,

110 S.W.3d 336, 354 (Ky. 2003). Substantial evidence has been defined as

“evidence of substance and relevant consequence, having the fitness to induce

conviction in the minds of reasonable men.” Kentucky State Racing Commission v.

Fuller, 481 S.W.2d 298, 308 (Ky. 1972) (internal quotation marks and citation

omitted).

              However, while deferential to the lower court’s factual findings,

appellate review of legal determinations and conclusions from a bench trial is de

novo. Sawyers v. Beller, 384 S.W.3d 107, 110 (Ky. 2012).

                     3. Whether Lawrence Had a “Reasonable Opportunity” to
                        Seek the Advice of Independent Legal Counsel

              In its April 24, 2020, order, the circuit court found that Lawrence was

not provided with a reasonable time to consult with independent counsel. Rule

1.8(a) states, in pertinent part, that “[a] lawyer shall not enter into a business

transaction with a client or knowingly acquire an ownership, possessory, security

or other pecuniary interest adverse to a client unless . . . (2) the client . . . is given a

                                           -10-
reasonable opportunity to seek the advice of independent legal counsel on the

transaction[.]”

             In this case, we disagree with the circuit court’s conclusion that

Lawrence was not given a reasonable opportunity to seek the advice of

independent legal counsel on the transaction. “The opportunity to seek

independent advice must be real and meaningful. It is not enough that at some

moment in time an opportunity existed no matter how brief or fleeting that

opportunity might have been.” Valley/50th Ave., L.L.C. v. Stewart, 153 P.3d 186,

190 (Wash. 2007) (en banc) (citation omitted). Moreover, “[t]he definition of a

‘reasonable opportunity’ may depend on the circumstances of any given case, but it

will always mean more than the mere physical ability to contact an attorney.” Id.

at 191.

             On this point, Lawrence’s testimony during the evidentiary hearing is

the best evidence. For example, Lawrence testified that in December 2011 and

February 2012, he consulted with other attorneys in his office regarding the

proposed arrangement when Kiefer recommended him in writing to do so.

Lawrence undeniably had a “reasonable opportunity” to consult with other

attorneys when he did consult with other non-Bingham attorneys on at least two

separate occasions about moving to a flat fee arrangement secured by collateral.

                                        -11-
             Additionally, the parties’ discussions and negotiations concerning fee

issues continued throughout the months of December, January, February, and

March. The negotiations culminated with Lawrence confirming his agreement to

all of the terms in a letter memorializing the parties’ written agreement dated April

2, 2012, and signed by Lawrence on April 3, 2012. That period of four months

certainly gave Lawrence a “reasonable opportunity” to consult with independent

counsel concerning the arrangement. Moreover, Lawrence, an attorney and

businessman, participated actively in the discussions concerning the changes to the

fee agreement and securing payment with a mortgage for at least four months with

Bingham. Lawrence also had the opportunity to review the written letter

agreement, promissory note, and mortgage documents, commenting on and

revising them on at least two different occasions in March and April 2012 before

signing them months later in June and July 2012.

             The circuit court erred when it focused on the time between when

Lawrence signed the mortgage and promissory note in June and July 2012 and the

trial date in June 2012. In doing so, the circuit court overlooked that there were no

additional negotiations concerning – or revisions to – either document after April

2012 other than a change to the property description of the Marathon Property.

The circuit court correctly recognized that no additional correspondence between

the parties was admitted into evidence for the time between April and June 2012

                                        -12-
about negotiations concerning the change in fee arrangement. However, the record

reflects that the absence of evidence was because there were no further

negotiations during that period. Moreover, Lawrence has provided no evidence

that Bingham attempted to change the agreement’s terms materially or

substantively after the parties reached an agreement in April 2012. Therefore, the

record and Lawrence’s conduct indicate that during the period of substantive

discussions and negotiations of the fee agreement, Lawrence was provided with

“real and meaningful” opportunities to consult with an independent attorney.

Stewart, 153 P.3d at 191.

             Moreover, the fact that Lawrence sought and obtained independent

legal advice during the negotiation period is evidence that he knew he could obtain

independent advice at all stages of the negotiations, including up until he signed

the mortgage. Rule 1.8(a) requires that the client be “given a reasonable

opportunity to seek the advice of independent legal counsel on the transaction[.]”

(Emphasis added.) Lawrence’s conduct demonstrated that he both knew he had the

opportunity to seek the advice of independent counsel and took advantage of that

opportunity. Thus, we reverse the circuit court and find that Lawrence was given a

reasonable opportunity to consult with independent legal counsel.

                                        -13-
                    4. Whether the circuit court Mistakenly Interpreted the
                       Amount of Bingham’s Security Interest

             Bingham argues that the circuit court made two mistakes when

analyzing Bingham’s security interest in the Marathon Property. The first alleged

mistake was that the circuit court did not recognize that Bingham only had a

security interest – and not an ownership or possessory interest – in the Marathon

Property. The second alleged mistake was that the circuit court did not recognize

that the amount of Bingham’s security interest in the Marathon Property was no

greater than the flat fee agreed to by Lawrence.

             In this case, the arrangement is a “security . . . interest adverse to a

client” as contemplated under Rule 1.8(a). Indeed, “Kentucky law has long

subscribed to the ‘lien theory’ of mortgages and holds that a mortgage is a mere

security for debt, and that, . . . the mortgagor is the real owner of the property

mortgaged.” Grafton v. Shields Mini Markets, Inc., 346 S.W.3d 306, 310 (Ky.

App. 2011) (some internal quotation marks and citations omitted). Therefore,

“mortgages are treated no differently than any other lien and, generally,

mortgagors – not mortgagees – are considered the owners of mortgaged property.”

Id. (emphasis added) (footnote omitted).

             However, although the arrangement in this case was a “security

interest adverse to a client” as contemplated under Rule 1.8(a), the result was not

that the arrangement automatically violated Rule 1.8(a). Rather, the parties were

                                          -14-
required to comply with the requirements of Rule 1.8(a). This is illustrated by

another Kentucky Supreme Court rule, which states that while “[a] lawyer shall not

acquire a proprietary interest in the . . . subject matter of litigation the lawyer is

conducting for a client,” a “lawyer may . . . acquire a lien authorized by law to

secure the lawyer’s fee or expenses[.]” SCR 3.130(1.8)(i)(1). Thus, the Rules

contemplate that, under the correct circumstances, and when done in compliance

with the Rules, an attorney may take out a lien even on the subject matter of

litigation the lawyer is conducting for a client to secure the lawyer’s fees.

Therefore, Bingham did not automatically violate Rule 1.8(a) by using a mortgage

of the Marathon Property to secure the payment of its legal fees.

             Additionally, the record reflects that Bingham did not have a security

interest in Lawrence’s property for more than what Lawrence owed to Bingham.

The promissory note and mortgage only permitted Bingham to collect what

Lawrence owed under the parties’ letter agreement, as referenced in the promissory

note. Indeed, the promissory note was not for a flat fee of $650,000 but for “up to

(and not to exceed)” $650,000 as provided in the parties’ letter agreement, which

the note specifically referenced.

             Moreover, the circuit court found the “future advance clause” in the

mortgage problematic. Such clause stated that the mortgage would secure “up to

(and not exceed) the maximum aggregate amount of $1,000,000.00[.]” However,

                                           -15-
by its terms, the mortgage only secured the amount Lawrence owed and nothing

more. Instead, and only in the event of any additional indebtedness, the aggregate

maximum amount capped the potential total security interest at a maximum of

$1,000,000.00, giving Bingham priority over any subsequent lienholders up to that

amount. Moreover, Kentucky statute explicitly authorized such language. See

Kentucky Revised Statute (“KRS”) 382.520(2). As stated in First Commonwealth

Bank of Prestonsburg v. West, “future advance clauses . . . are valid in Kentucky.

. . . It is sufficient if the mortgage clearly shows it is to stand as security for both an

original loan and for such additional indebtedness as may arise from future

dealings between the parties.” 55 S.W.3d 829, 833 (Ky. App. 2000) (internal

quotation marks and citations omitted). In this case, the language did not state that

Lawrence owed the amount listed under the maximum aggregate amount, and

Bingham did not have any ability to collect more than Lawrence owed under the

parties’ agreement.

                      5. Conclusion

              Thus, because we conclude that the parties’ arrangement met the

requirements of Rule 1.8(a), we reverse the circuit court’s judgment and remand to

the circuit court for the enforcement of the mortgage on the Marathon Property.

                                           -16-
                b. Lawrence’s Cross-Appeal

             Lawrence frames his cross-appeal in the following terms: “Gallatin

circuit court first correctly enforced the mandate, then, departed and exceeded the

mandate and its jurisdiction/authority, unwinding a final-confirmed judicial sale

and approved judicial deed that had finally conveyed [the Marathon Property] to a

non-party as was requested by [Bingham].”

             As previously discussed, in denying Bingham summary judgment, the

circuit court vacated its previous order of sale of the Marathon Property and

fixtures and ordered the Special Master Commissioner to prepare a deed conveying

the Marathon Property back to Lawrence. Lawrence takes issue with the circuit

court’s actions in his cross-appeal. Lawrence also includes arguments concerning

conversion and the deed he received as part of his cross-appeal. However, the

circuit court did not rule on these claims until October and December 2020 at the

earliest, while Lawrence filed the notice of appeal for his cross-appeal on

September 29, 2020. Thus, we decline to address the issues raised by Lawrence on

cross-appeal.

             c. Lawrence’s Direct Appeal

             Lawrence’s direct appeal involves the circuit court’s decisions from

September 2020 to March 2021. In October 2020, the circuit court held that

Lawrence was not entitled to “damages” or “liquidated fair market value” but

                                        -17-
rather restitution of the net benefits Bingham “received during the time it owned

the Marathon Property.” The circuit court further held that Bingham had not

converted the Marathon Property and that Bingham was not required to repay the

attorneys’ fees Lawrence had already paid to Bingham.

             Thereafter, the circuit court denied Lawrence’s motion for

reconsideration of its October 2020 order in an order dated December 15, 2020.

The circuit court reiterated that restitution was the appropriate remedy in this case

and found no grounds to alter its previous decisions. Similarly, in another order

entered on December 15, 2020, the circuit court denied Lawrence’s CR 59.05

motion as to the circuit court’s August 2020 order. Specifically, the circuit court

denied Lawrence’s attempt to assert claims based on “deficient performance”

issues, stating “[t]he Court has addressed [Lawrence’s] arguments in previous

Orders and will not do so again. The Court finds no grounds for which to change

its previous decision.” Moreover, the circuit court found no basis for a claim

necessitating Bingham to repay attorneys’ fees previously paid by Lawrence to

Bingham.

             Additionally, on December 16, 2020, the circuit court entered a final

order instructing the Special Master Commissioner to sign the deed consideration

certificate and file and record the deed for the Marathon Property with the county

                                         -18-
clerk. This order was needed because Lawrence returned the deed to the Special

Master Commissioner unsigned rather than signing and filing the deed himself.

             Thereafter, the circuit court denied numerous other motions filed by

Lawrence. Lawrence filed his notice of appeal on March 18, 2021.

             Lawrence first argues that the circuit court erred in dismissing his

counterclaims based on the “Exoneration Rule.” However, the Kentucky Supreme

Court in Lawrence v. Bingham, Greenebaum, Doll, L.L.P., 567 S.W.3d 133, 141

(Ky. 2018) (“Lawrence II”) and Lawrence III barred any of Lawrence’s claims

based on Bingham’s alleged “deficient performance.” In Lawrence II, the

Supreme Court affirmed this Court’s application of the “Exoneration Rule,”

finding that the circuit court properly dismissed a 2015 complaint by Lawrence

founded on Bingham’s alleged professional negligence in its former representation

of Lawrence. See Lawrence II, 567 S.W.3d at 135. The Supreme Court concluded

that, “[b]ecause Lawrence failed to allege that he had been exonerated of his

convictions through post-conviction proceedings, the trial court correctly dismissed

his legal malpractice claim without prejudice.” Id. at 141.

             Moreover, in Lawrence III, the Supreme Court held that issue

preclusion barred any argument Lawrence subsequently made based on claimed

deficient performance by Bingham. 599 S.W.3d at 825-26. As noted by the

Supreme Court, “[w]hether [Bingham’s] performance in representing Lawrence

                                        -19-
was deficient is an issue that has already been litigated” in the criminal proceeding

when Lawrence filed a motion to set aside his conviction based on allegations of

ineffective assistance of counsel. Id. at 825. “Neither the federal magistrate judge

nor the federal district judge found any hint of deficient performance on

[Bingham’s] part.” Id. at 824-25. Therefore, Lawrence is barred from rearguing

the matter.

              Lawrence next argues that the promissory note and mortgage between

the parties “encumbered, clouded and slandered” title on the Marathon Property.

However, claims founded on the promissory note were addressed by the Supreme

Court in Lawrence I and Lawrence III, with judgment in Bingham’s favor. Indeed,

the Supreme Court in Lawrence I found that Bingham was entitled to judgment on

the promissory note, and the Supreme Court reiterated such finding in Lawrence

III. See Lawrence I, 567 S.W.3d at 131; Lawrence III, 599 S.W.3d at 826

(“Because all the elements of claim preclusion are satisfied here, Lawrence’s

challenge on the amount of attorneys’ fees owed, i.e.[,] the enforceability of the

promissory note, is precluded. Any argument made by Lawrence seeking to

renege on his obligation owed per the promissory note is barred by claim

preclusion.”).

              Moreover, no court has ever determined that Bingham’s mortgage on

the Marathon Property was invalid. All that the Supreme Court in Lawrence III

                                        -20-
required the circuit court to address regarding the mortgage was to conduct further

proceedings regarding the Rule 1.8(a) analysis. 599 S.W.3d at 828-29. Moreover,

the circuit court’s determination that Bingham was not entitled to summary

judgment on its foreclosure claim did not equate to a final judgment regarding the

mortgage’s validity.

             Indeed, almost every argument Lawrence makes in his appeal is based

on the incorrect claim that the Supreme Court in Lawrence III “preserved”

affirmative claims for Lawrence. However, the only defense that Lawrence gained

from Lawrence III was that Bingham’s mortgage on the Marathon Property may

not be enforceable. See Lawrence III, 599 S.W.3d at 828. The Supreme Court

unambiguously stated that a violation of the ethical rules does not create a private

right of action. Id.

             Lawrence next argues that Bingham converted certain business

fixtures at the Marathon Property and therefore deserves damages. However, in

this case, the equitable principles of restitution apply, and parties like Bingham are

not subject to liability or damages when prior judgments in their favor are later

deemed erroneous or vacated. See Bridges v. McAlister, 106 Ky. 791, 798, 51

S.W. 603, 605 (1899) (“When a judgment is reversed, restitution must be made of

all that has been received under it, but no further liability should in any case be

imposed.”). In ordering both the Marathon Property and the fixtures to be deeded

                                         -21-
back to Lawrence, along with any of the net benefits Bingham received from the

Marathon Property during the time it collected the rents and paid the expenses, the

circuit court followed the proper principles of restitution. Id.

             Lawrence also makes arguments concerning the amount of damages

Bingham owes him and the fair market value of the Marathon Property. However,

because we have found that Lawrence has no valid claims to pursue, such

arguments are moot, and we decline to address them. Moreover, the amount of

monetary restitution is not before this Court. The circuit court determined such an

amount in a November 2021 order, and Lawrence filed his direct appeal’s notice of

appeal on March 18, 2021. Thus, such amount is not an issue in any of the appeals

before the Court in this matter.

             Finally, Lawrence argues that he should receive compensation or

damages for alleged maintenance issues relating to the Marathon Property.

However, Lawrence did not file a motion requesting such compensation until April

27, 2021, after the date that he filed his notice of appeal in this matter. Thus, such

issues are not properly before this Court.

             Thus, for the foregoing reasons, we affirm the circuit court as to all

claims raised in Lawrence’s direct appeal.

                                         -22-
                                 CONCLUSION

            We reverse the circuit court’s April 24, 2020, order and remand for

the enforcement of the mortgage on the Marathon Property. We affirm the circuit

court as to the issues Lawrence raised on cross-appeal and direct appeal.

            ALL CONCUR.

BRIEFS FOR APPELLANT/                     BRIEFS FOR APPELLEE/
CROSS-APPELLEE:                           CROSS-APPELLANT MEREDITH
                                          L. LAWRENCE:
Aaron A. VanderLaan
Frank K. Tremper                          Meredith L. Lawrence, pro se
Covington, Kentucky                       Katy Lawrence
                                          Warsaw, Kentucky

ORAL ARGUMENT FOR                         ORAL ARGUMENT FOR
APPELLANT:                                APPELLEE:

Frank K. Tremper                          Meredith L. Lawrence, pro se
Covington, Kentucky                       Warsaw, Kentucky

                                        -23-