Pierson v.
Burlison
Filed 1/22/14
Pierson v. Burlison CA2/4
NOT TO BE PUBLISHED IN THE
OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a),
prohibits courts and parties from citing or relying on opinions not certified
for publication or ordered published, except as specified by rule
8.1115(b). This opinion has not been
certified for publication or ordered published for purposes of rule 8.1115.
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
SECOND APPELLATE DISTRICT
DIVISION FOUR
CHARLES PIERSON et al.,
Plaintiffs, Cross-defendants and
Respondents,
v.
ROBERT C.
BURLISON, JR., et al.,
Defendants, Cross-complainants
and Appellants.
B244908
(Los
Angeles County
Super. Ct. No. BC428459)
APPEAL
from a judgment of the Superior Court of
Los Angeles, Ernest M. Hiroshige, Judge.
Affirmed in part, reversed in part and remanded.
Burlison
Law Group and Robert C. Burlison, Jr. for Defendants, Cross-complainants and
Appellants.
Leist
Law Group and Jeffrey J. Leist for Plaintiffs, Cross-defendants and
Respondents.
Appellants
Robert C. Burlison, Jr. and his firm, Burlison & Luostari (B&L), appeal
a judgment rendered in favor of former clients respondents Charles Pierson and
Donald and Ani Hovanesian. The
committed legal malpractice resulting in damage to Pierson in the amount of
$168,000, representing a judgment for attorney fees awarded to the defendants
in a prior breach of contract lawsuit to which Pierson had been improperly added
as a plaintiff. The court further found
that the Hovanesians were owed $40,000 in settlement funds recovered in the
prior litigation. Although appellants
presented evidence that the Hovanesians had not fully paid for all
litigation under a retainer agreement with B&L, the court concluded that
appellants were entitled to no offset because the retainer agreement included a
provision permitting B&L to assert an improper lien over funds recovered in
the prior litigation. We conclude that despite the invalidity of
the lien provision, B&L was not barred from recovering for
under the retainer agreement. We
therefore remand for determination of the amount owed B&L, if any, under
the evidence presented at trial. We
otherwise affirm.
A. Prior
Litigation
In
2006, respondent Pierson entered into an agreement to purchase a home in Sun Valley from Christopher and Lynn
Couveau for $750,000. While escrow was
pending, Pierson’s agent (his brother, Gary Nicholson) wrote to the Couveaus’
broker indicating that the sale price should be reduced because the property
had been appraised for $720,000. The Couveaus
treated Pierson’s letter as a repudiation, and thereafter sold the house to another
party for substantially more than $750,000.
Pierson
assigned all of his rights in the purchase contract to respondents Ani and
Donald Hovanesian. In July 2006, the
Hovanesians, represented by attorney Thomas Kostos, initiated legal action
against the Couveaus.
On October 12, 2006, the Hovanesians replaced attorney Kostos
with appellants, and entered into a written retainer agreement with B&L. The agreement provided that attorney fees for
legal services rendered by appellants would be billed at an hourly rate. The agreement stated that the Hovanesians
granted to B&L “a lien against any recovery on this claim to satisfy or
discharge any fees or costs due and owing to [B&L],†and further granted
“the right to retain, in full, out of the amounts finally received by
settlement, compromises, judgments, awards, or otherwise, their share of any
fees or costs due and owing to [B&L].â€
The agreement further stated: “If legal action is required to enforce this
Agreement or to collect any fees or costs earned or advanced pursuant thereto,
the prevailing party shall be entitled to recover any and all costs of such
action, including, but not limited to, the expenses and court costs of the
action, [and] a reasonable attorney’s fee, notwithstanding that [B&L] may
represent [itself] . . . .â€
After substituting
in as attorney of record, appellants drafted and filed two amended complaints. The first added as defendants Pierson’s real
estate brokers, Ellis Realty and Gary Nicholson, and asserted a new claim for
broker negligence. The second added Pierson
as a plaintiff. In March 2008, the
brokers settled for $40,000 which was deposited in B&L’s client trust
account.
Couveaus, who prevailed in a judgment entered May
20, 2008 and were awarded attorneys’ fees and costs in the amount of $166,217.25 under
a provision in the sales agreement.
Appellants
filed a notice of appeal, which listed the Hovanesians as appellants, but not
Pierson.
Pierson to collect their judgment for attorney fees. In January 2011, Pierson paid the Couveaus $168,000
to satisfy their judgment.
B. Underlying
Action
1.
Complaint and Cross-Complaint
Pierson
and the Hovanesians filed an action against appellants asserting a single claim
for professional negligence/legal malpractice. The complaint alleged that appellants were
negligent in adding Pierson as a plaintiff to the claim for breach of contract
against the Couveaus in the prior action.
Specifically, it contended that Pierson had been added solely to trigger
the insurance coverage for broker negligence provided by the brokers’
malpractice insurer and had no rights under the contract after assigning it to
the Hovanesians. By adding Pierson as a
plaintiff to the breach of contract claim, appellants rendered him potentially
(and ultimately) liable for attorney fees awarded the Couveaus when they
prevailed in their defense of that claim.
The complaint also asserted that appellants were negligent in failing to
include Pierson in the notice of appeal filed in the prior action. With respect to the Hovanesians, the
complaint alleged that appellants wrongfully withheld the $40,000 paid by the
broker defendants in the prior action, and that appellants held no valid lien
on the funds.
Appellants
answered, asserting as an affirmative defense that respondents were obligated
to them for unpaid fees and costs incurred in the prior action, and that
appellants were entitled to a set-off against any award. In addition, B&L filed a cross-complaint
asserting claims for breach of contract (the retainer agreement), open account,
quantum meruit, and declaratory relief against the Hovanesians. In the cause of action for breach of contract,
B&L contended that in October 2006, the Hovanesians had entered into an
agreement with B&L for the provision of legal services in the Couveau
lawsuit. During this representation, the
Hovanesians allegedly agreed to add Pierson as a plaintiff in the prior action in
order to obtain a recovery from the brokers’ insurer, and they also allegedly
agreed to pay B&L for the legal services rendered in asserting such claims.
B&L alleged that the Hovanesians
failed to pay invoices submitted to them. B&L further alleged that the Hovanesians
authorized application of the settlement funds to outstanding sums owed B&L
for the prior litigation, and that if those funds were not applied, the
Hovanesians would owe B&L $45,000 for legal services rendered. The cause of action for open account alleged
that an account was stated in writing between B&L and the Hovanesians. The cause of action for quantum meruit
alleged that between October 2006 and December 2009, B&L provided legal
services for the Hovanesians in the prior action, but the Hovanesians failed to
pay B&L fair and reasonable compensation. The cause of action for declaratory relief alleged
that the Hovanesians authorized the inclusion of Pierson in the prior action
and the use of the settlement funds to pay attorney fees, and that a
declaration of the parties’ rights and duties was needed. B&L sought recovery of attorney fees
expended in pursuing the cross-complaint.
2. Trial
and Statement of Decision
The
parties agreed to a court trial. At
trial, Pierson contended, and the court found true, that appellants were
negligent (1) in failing to include him in the notice of appeal of the Couveaus’
judgment; and (2) in amending the underlying complaint against the Couveaus to add
Pierson as a plaintiff in the claim for breach of contract, when he had
assigned his rights under the contract to the Hovanesians. The court found that this negligence caused Pierson
to suffer damages in the initial amount of $166,217.25 -- the attorney fees
awarded the Couveaus in their successful defense of the breach of contract
claim -- and that Pierson mitigated damages by paying $168,000 to the Couveaus
in January 2011, preventing the accumulation of additional interest and attorney
fees.
Appellants
theorized that the funds to pay the attorney fee judgment to the Couveaus came
from the Hovanesians, and that they were acting through Pierson to recover the
funds paid. Pierson testified, and the
trial court found true, that he had borrowed the money from his brother.
the settlement was somehow collusive or conspiratorial, and noted
that an attorney who is the subject of a legal
malpractice claim cannot reduce the damages recoverable by the plaintiff by
asserting contributory negligence or comparative fault.
With
respect to the Hovanesians’ claim, they contended, and the court found true,
that by failing to inform the Hovanesians of their right to seek the advice of
independent counsel before signing a retainer agreement containing an attorney
lien provision, and by taking funds from the trust account under such lien provision
in violation of clear legal authority, appellants committed malpractice. The court concluded that due to the failure
to comply with rule 3-300, B&L had no right to assert a lien against the
$40,000 settlement from the brokers or to apply it to fees and costs.
With
respect to B&L’s cross-claims, the court found that the Hovanesians did not
owe appellants for Pierson’s legal fees and costs, as there was no written fee
agreement requiring them to pay these amounts.
The court found that the claim for breach of contract for failure to pay
fees for services rendered by B&L to the Hovanesians under the October 2006
retainer agreement was “barred because of the violation of . . . rule 3-300 . .
. per Fletcher [v. Davis, supra, 33 Cal.4th
61].â€
With
respect to the open account/account stated claim, the Hovanesians testified to
their understanding that the majority of the fees for which they had been
billed by appellants had been paid at the time the settlement was received,
shortly before the trial against the Couveaus commenced. The court found no evidence that the
Hovanesians had been billed by B&L after the trial.
The court concluded recovery was
precluded on the account stated claim because a creditor cannot collect on such
claim unless “‘the account be sent to the debtor and he does not object to it
within a reasonable time.’†(Quoting
639.)
With
respect to the quantum meruit claim, the court found no evidence of the amount
of time expended, the difficulty involved, or appellants’ skill level. To the contrary, the court found that
“[g]iven the testimony concerning [Burlison’s] lack of skill in both client
agreements, mishandling of client funds, improper inclusion of Pierson in a
cause of action where he lacked standing, (resulting in the imposition of a
judgment against Pierson), and the failure to timely file a notice of appeal as
to Pierson, thereby precluding him from challenging the judgment, the facts
demonstrate a shocking lack of skill.â€
Appellants
requested a statement of decision explaining the basis for the court’s
determination. Appellants specifically
requested that the court resolve: whether Nicholson was Pierson’s agent; whether
the $10,000 Pierson deposited into escrow belonged to Nicholson; whether
Pierson was being used as a “straw man†in the litigation; whether Pierson
demanded that the Hovanesians pay part of the Couveaus’ judgment; whether
Pierson was advised of the conflict between his interests and the Hovanesians;
whether legal malpractice claims are assignable; whether the Hovanesians and
Nicholson acted in collusion in “assign[ing] the malpractice claim to Piersonâ€;
whether the Hovanesians authorized the payment of outstanding invoices from
settlement proceeds; whether monthly statements were sent to the Hovanesians;
whether the Hovanesians were “joint tortfeasorsâ€; whether Pierson failed to
mitigate damages; “how the court calculated, including on what factual basis
and what legal basis, any damages it awarded on the complaint and
cross-complaintâ€; and whether “the court weighed, when calculating damages, the
responsibility of [the Hovanesians] for payment of the judgment and reduced
damages by 2/3 that were owed by them.â€
Per the
court’s order, respondents prepared a proposed statement of decision, which
essentially tracked the court’s original findings as outlined above.
The court adopted the statement of
decision drafted by respondents. The
only objection raised by appellants to the proposed statement of decision
pertained to the court’s decision to award pre-judgment interest on the $40,000
payable to the Hovanesians. The court overruled
the objection and awarded judgment to Pierson in the amount of $168,000, plus
prejudgment interest, and to the Hovanesians in the amount of $40,000, plus
prejudgment interest. The judgment
stated that respondents were awarded “costs,†leaving the amount blank. On November
1, 2012, appellants noticed an appeal of the “[j]udgment after court trial.â€
3.
On November 5, 2012, the Hovanesians filed a
motion for recovery of contractual attorney fees under the October 2006
retainer agreement and Civil Code section 1717, seeking an award of $35,720
jointly and severally against Burlison and B&L. Appellants opposed, contending the retainer
agreement was incapable of supporting an attorney fee award because the court
had essentially found it void.
Appellants also pointed out that B&L was the only party to the
retainer agreement and the sole named plaintiff in the cross-complaint. The court awarded $21,432 in fees to the
Hovanesians, payable by B&L only.
The court concluded that although “the lien provision in the retainer
agreement . . . was unenforceable because [B&L] violated . . . Rule 3-300 . . . [t]his
d[id] not mean . . . that the entire retainer agreement was void for
illegality.†No appeal was taken from
the post-judgment attorney fee order.
A. Statement
of Decision
Under
Code of Civil Procedure section 632, upon the request of any party, the court
“shall issue a statement of decision explaining the factual and legal basis for
its decision as to each of the principal controverted issues at trial.†“The trial court has a mandatory duty to
provide a statement of decision when properly requested.†(Espinoza
v. Calva (2008) 169 Cal.App.4th 1393, 1397; see Cal. Rules of Court, rule
3.1590(f).) Here, appellants requested a
statement of decision, and the court provided one. The issue raised on appeal is whether the statement
of decision was adequate. We conclude
that any objection to its content was waived and that, in any event, the
statement of decision was not deficient.
“[I]t
is settled that the trial court need not, in a statement to decision, ‘address
all the legal and factual issues raised by the parties.’†[Citation.] It ‘is required only to set out ultimate
findings rather than evidentiary ones.’†(Yield
Dynamics, Inc. v. TEA Systems Corp. (2007) 154 Cal.App.4th 547, 559,
quoting Muzquiz v. City of Emeryville
(2000) 79 Cal.App.4th 1106, 1124-1125.) “‘“[U]ltimate
fact[]â€â€™. . . in general . . . refers to a core fact, such as an
element of a claim or defense, without which the claim or defense must fail. [Citation.] It is distinguished conceptually from ‘evidentiary
facts’ and ‘conclusions of law.’
[Citation.]†(
supra, at p. 559.) The court is not required to “make a list of
findings on evidentiary facts on issues not controverted by the pleadings†or
to provide specific answers to every question “so long as the findings in the
statement of decision fairly disclose the court’s determination of all material
issues.†(People v. Casa Blanca Convalescent Homes, Inc. (1984) 159 Cal.App.3d
509, 525, overruled in part on other grounds in Cel-Tech Communications, Inc. v. Los Angeles Cellular Telephone Co., (1999)
20 Cal.4th 163; accord, Golden Eagle Ins.
Co. v. Foremost Ins. Co. (1993) 20 Cal.App.4th 1372, 1379-1380 [statement
of decision sufficient if it “fairly discloses the court’s determination as to
the ultimate facts and material issues in the caseâ€].) Furthermore, a party waives any defect in the
statement of decision by failing to file timely objections to a proposed
statement of decision or otherwise bring deficiencies to the trial court’s
attention. (Golden Eagle Ins. Co. v. Foremost Ins. Co., supra, at p. 1380.)
Appellants
asked the court to address 29 issues and contend on appeal that 13 of the
issues were not addressed. Appellants
waived any defect in the court’s statement of decision by failing to file
timely objections based on the issues they now claim were unaddressed. (Golden
Eagle Ins. Co. v. Foremost Ins. Co., supra,
20 Cal.App.4th at p. 1380; see California Rules of Court, rule 3.1590(g) [“Any
party may, within 15 days after the proposed statement of decision and judgment
have been served, serve and file objections to the proposed statement of
decision or judgment.â€].) “By filing
specific objections to the court’s statement of decision a party pinpoints
alleged deficiencies in the statement and allows the court to focus on the
facts or issues the party contends were not resolved or whose resolution is
ambiguous.†(Golden Eagle Ins. Co. v. Foremost Ins. Co., supra, at p. 1380.) The sole
objection to the proposed statement raised by appellants was the court’s
decision to award prejudgment interest to the Hovanesians. Accordingly, they have waived any right to
complain regarding the adequacy of the statement of decision in addressing the
issues specified in their brief on appeal.
Moreover,
were we to reach the merits, we would find no basis for remand. Many of the issues set forth in the opening
brief -- whether the Hovanesians authorized the payment of outstanding invoices
from settlement proceeds, whether they received monthly statements, whether
Pierson and the Hovenesians were acting in collusion, whether Pierson was being
used as a “straw man†for the Hovanesians, and whether Pierson mitigated
damages -- were specifically addressed in the statement of decision. The answer to others -- how the court
calculated damages and whether the court reduced the judgment to Pierson by an
amount representing the Hovanesians share of the prior judgment -- was
self-evident. The remaining issues
appellants claim were inadequately addressed in the statement of decision --
whether Nicholson was Pierson’s agent, whether the $10,000 Pierson deposited into
escrow belonged to Nicholson, whether Pierson demanded that the Hovanesians pay
part of the Couveau judgment, whether Pierson was advised of the conflict
between his interest and the Hovanesians, whether the Hovanesians were joint
tortfeasors, and whether legal malpractice claims are assignable -- were
irrelevant to the matters at issue in the underlying litigation. In short, there is no basis for appellant’s
assertion that the statement of decision was inadequate or deficient.
B. Mitigation
Appellants
assert that whether Pierson demanded that the Hovanesians pay the Couveaus’ judgment
or any portion thereof was relevant to whether he “mitigate[d] . . . damage[s].â€
Appellants contend that the Hovanesians
were primarily responsible for paying the Couveaus’ attorney fees judgment because
they were assignees of all Pierson’s rights under the 2006 sales contract
and were parties to a retainer agreement with B&L under which they purportedly
agreed to pay Pierson’s litigation fees and costs.
In appellants’ view, by taking full
responsibility for paying the attorney fee judgment and seeking recovery of 100
percent of his $168,000 payment to the Couveaus from appellants, Pierson effectively
assigned the benefit of his legal malpractice claim to the Hovanesians in
violation of public policy. (See
389, 397 [assignment of chose in action for legal malpractice contrary to
public policy].) Neither mitigation nor
assignment of a legal malpractice claim are at issue here. Properly stated, the issue is whether Pierson
was obligated to pursue in the underlying litigation all of the parties
potentially liable for reimbursing him for his payment to the Couveaus. We conclude he was not.
There
is no dispute that Pierson suffered a judgment rendering him jointly and
severally liable, along with the Hovanesians, to pay the attorney fees incurred
by the Couveaus in the prior litigation.
The Couveaus were within their rights in pursuing Pierson to recover the
entire judgment. Where multiple parties
are legally responsible for a plaintiff’s losses, he or she may chose where to
impose liability, subject to a claim by the chosen defendant for contribution
or indemnity from the other potentially liable parties. (Atchison,
T. & S. F. Ry. Co. v. Lan Franco (1968) 267 Cal.App.2d 881, 884-885; cf.
Fireman’s Fund Ins. Co. v. Maryland
Casualty Co. (1998) 65 Cal.App.4th 1279, 1295, fn. 5 [party covered by
multiple insurance policies may obtain recovery from any one for entire
loss].) It is true that Pierson might
have sought at least partial reimbursement from the Hovanesians. (See Code Civ. Proc., § 882 [judgment debtor
who has satisfied more than his or her “due proportion†of judgment may compel
contribution from other judgment debtors]; Young
v. Rosenthal (1989) 212 Cal.App.3d 96, 130 [when there is no apportionment
made by judgment or dictated by terms of agreement or instrument, “‘due
proportion’†calculated on pro rata basis].)
It is equally true, however, that appellants’ negligence in including
Pierson as a party to the contract action against the Couveaus was a proximate
cause of Pierson’s loss and rendered appellants liable to Pierson on a theory
of attorney malpractice. Appellants cite
no authority for the proposition that Pierson was required to seek contribution
from the Hovanesians prior to pursuing the lawyer who caused his loss.
Here, the
trial court reasonably found that appellants’ negligence and legal malpractice
caused Pierson to suffer a money judgment in the amount of $166,217.25 on which
interest was accruing, and that Pierson mitigated damages by paying the Couveaus
$168,000 in January 2011. Accordingly,
the court properly awarded judgment against appellants in favor of Pierson in
the amount of $168,000. That the
Hovanesians might have been liable to Pierson for all or part of the judgment
under a different theory is not a defense to Pierson’s legal malpractice action
against appellants or a basis for reducing the damages he incurred.
C. B&L’s
Breach of Contract Claim
As
noted, rule 3-300 forbids members of the bar from “enter[ing] into a business
transaction with a client; or knowingly acquir[ing] an ownership, possessory,
security, or other pecuniary interest adverse to a client, unless . . . [t]he
client is advised in writing that the client may seek the advice of an
independent lawyer of the client’s choice and is given a reasonable opportunity
to seek that advice.†In
to a contract creating an attorney’s lien on an award recovered by the
attorney’s efforts (referred to as a “charging lienâ€). (Id.
at pp. 66, 68-69.) The Court there held
that a charging lien obtained in violation of rule 3-300 could not be enforced.
(Fletcher
v. Davis, at p. 72.) It did not,
however, hold that noncompliance with the rule invalidates the underlying fee
agreement or precludes an attorney from recovering the specified contractual
fee. In fact, courts have repeatedly
determined that fee provisions in retainer agreements are enforceable despite
the invalidity of a lien provision. (See,
e.g., Shopoff & Cavallo LLP v. Hyon
(2008) 167 Cal.App.4th 1489, 1523 [upholding attorney’s recovery of contractual
contingency fee despite presence of arguably invalid charging lien];
2013, CV 12-7908-GW(SHx)) [2013 U.S. Dist. LEXIS 120497 *18-19, 30-31 [claim
for breach of retainer contract survived although contractual lien was
unenforceable]; see Fair v. Bakhtiari
(2011) 195 Cal.App.4th 1135, 1165-1166 [observing that “in Shopoff, as in Fletcher,
the underlying fee agreement was preserved†and “[o]nly the charging lien was
voided,†as the charging lien “was easily severed from the agreement as a
wholeâ€]; McIntosh v. Mills (2004) 121
Cal.App.4th 333, 347 [“[T]he need to void contracts in violation of the law
must be tempered by the countervailing public interest in preventing a
contracting party from using the doctrine to create an unfair windfall.â€].)
In
ruling on B&L’s breach of contract claim, the court did not state that it
found the October 2006 retainer agreement void.
However, it provided no reason for
rejecting B&L’s breach of contract claim other than the violation of rule
3-300. As the above authorities make
clear, a violation of this rule has no effect on the attorney’s right to his or
her contractual fee. (See also
1000, 1006 [for violation of ethical rule to lead to forfeiture of attorney’s
right to recover fees, violation must be “serious,†and involve “‘“ [f]raud or
unfairness[,] . . . acts in violation or excess of authority, . .
. acts of impropriety inconsistent with the character of the profession, and
incompatible with the faithful discharge of [his or her] duties,â€â€™â€ or
“irreconcilable conflictâ€].)
Respondents
suggest that there was no evidence to support the contractual attorney fee
claim, noting that the court excluded monthly bills purportedly sent to the
Hovanesians and contending that B&L “offered no specific evidence as to the
amount of time expended, the difficulty involved, or [Burlison’s] skill
level.†Certain billing statements were
excluded as a sanction for failure to produce them during discovery or during
pre-trial proceedings. However, the
court permitted appellants to introduce a document summarizing the total amount
of time expended on the Couveau litigation by Burlison and another attorney at B&L
and providing a description of the activities on which the attorney time was
expended. The summary also described the
costs incurred by the firm on the Hovanesians’ behalf during the representation. This evidence was sufficient, if credited, to
support B&L’s breach of contract claim.
attorney supply billing statements to support a claim for attorney fees.†(Mardirossian
& Associates, Inc. v. Ersoff (2007) 153 Cal.App.4th 257, 269; accord,
Supply Co. (2000) 79 Cal.App.4th 285, 293.)
concerning the attorneys’ skill level or the difficulty of the case is
irrelevant to B&L’s breach of contract claim. As the court explained in
(1962) 201 Cal.App.2d 625, 637: “Usually
the mode and measure of an attorney’s compensation for services rendered to a
client is a matter for contractual agreement between them.†(Tracy
v. Ringole (1927) 87 Cal.App. 549, 551; Code Civ. Proc., § 1021.) Where the attorney and the client each have
the capacity to contract, and the fee is fixed or determined by their contract,
such determination is generally binding on both parties. (Cole v.
Superior Court (1883) 63 Cal. 86.) The
client cannot escape full payment merely because the attorney’s services proved
to be less valuable than the parties had in mind when they entered into the
contract. (Reynolds v. Sorosis Fruit Co. (1901) 133 Cal. 625, 630.) “An attorney suing upon a contract for an
agreed fee is not required to prove the reasonable value of his services.†(Berk,
supra, 201 Cal.App.2d at p. 637; see MacInnis
v. Pope (1955) 134 Cal.App.2d 528, 530 [finding no reason to consider
“‘reasonable value’†where “[p]laintiff [attorney] sued on a written contract
fully performedâ€; “when an attorney fully performs the services required by the
contract he is entitled to the fee stipulated in the contractâ€].)
Our
review of the record below indicates that the Hovanesians presented no defense
to B&L’s breach of contract claim for legal services rendered under the October
2006 retainer agreement, other than the failure to comply with rule 3-300. Failure to comply with the rule voided any purported
lien but did not void the Hovanesians’ obligation to pay for legal services
rendered under the agreement. Remand is
required for the court to determine the amount due B&L under the agreement
and the evidence presented at trial.
The
judgment is reversed with respect to B&L’s claim for breach of
contract. The matter is remanded for
determination of the amount of compensation owed by the Hovanesians to B&L
under the October 2006 retainer agreement.
In all other respects, the judgment is affirmed. Each party is to bear his, her or its own
costs.
TO BE PUBLISHED IN THE OFFICIAL REPORTS
MANELLA,
J.
We concur:
EPSTEIN, P.J.
EDMON, J.*
*Judge of the Los
Angeles Superior Court, assigned by the Chief Justice pursuant to article VI,
section 6 of the California Constitution.
retained a $10,000 deposit paid by Pierson.
agreement did not advise the Hovanesians that they could seek the advice of
independent counsel. (See Cal. Rules of
Prof. Conduct, rule 3-300 (rule 3-300) [“A member shall not
. . . knowingly acquire an ownership, possessory, security, or
other pecuniary interest adverse to a client, unless each of the following
requirements has been satisfied:
. . . (B) The client is advised in writing that the
client may seek the advice of an independent lawyer of the client’s choice and
is given a reasonable opportunity to seek that adviceâ€]; Fletcher v. Davis (2004) 33 Cal.4th 61, 66, 69 [attorney’s lien on
fund or judgment which the attorney had a hand in recovering, known as a
“charging lien,†grants attorney “considerable authority to detain all or part
of the client’s recovery whenever a dispute arises over the lien’s existence or
its scope†and is, therefore, “an adverse interest within the meaning of rule
3-300 and thus requires the client’s informed written consentâ€].)
