Baker Marquart LLP v. Kantor

231 Cal. Rptr. 3d 796, 22 Cal. App. 5th 729
CourtCalifornia Court of Appeal, 5th District
DecidedApril 25, 2018
DocketB280861
StatusPublished
Cited by15 cases

This text of 231 Cal. Rptr. 3d 796 (Baker Marquart LLP v. Kantor) is published on Counsel Stack Legal Research, covering California Court of Appeal, 5th District primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Baker Marquart LLP v. Kantor, 231 Cal. Rptr. 3d 796, 22 Cal. App. 5th 729 (Cal. Ct. App. 2018).

Opinion

LUI, P.J.

*731Appellant Baker Marquart LLP represented respondent James R. Kantor on a contingency basis in litigation that resulted in a significant recovery for Kantor. Following the conclusion of Baker Marquart's representation, Kantor filed a demand for fee arbitration in accordance with the parties' contingency fee agreement. In his arbitration demand, Kantor argued Baker Marquart charged him an incorrect contingency fee because Baker Marquart failed to complete two specified tasks. In advance of the arbitration, *732however, Kantor submitted, and the three-person arbitration panel (panel) accepted, an ex parte "confidential arbitration brief" that Kantor did not provide or otherwise reveal to Baker Marquart. In the confidential brief, Kantor raised and argued additional claims not presented in his arbitration demand. A majority of the panel ruled in Kantor's favor and awarded him a refund of a portion of the fees he had paid to Baker Marquart. In its ruling, the panel majority addressed and relied on claims Kantor raised in the confidential brief.

Baker Marquart filed a motion in superior court to vacate the arbitration award; and Kantor filed a motion to confirm the award. Among other things, Baker Marquart argued unsuccessfully that, under Code of Civil Procedure section 1286.2 ( section 1286.2 ), the trial court was required to vacate the arbitration award because the award was procured by "corruption, fraud or other undue means." ( § 1286.2, subd. (a)(1).) In particular, Baker Marquart argued the confidential brief was an improper ex parte communication, relied on by the panel and to which Baker *798Marquart had no adequate opportunity to respond. The trial court denied Baker Marquart's motion to vacate and granted Kantor's motion to confirm. Baker Marquart appeals the resulting judgment.

As discussed below, we conclude the arbitration award was procured by "undue means" as that term is used in section 1286.2 and, as a result, must be vacated.

BACKGROUND

A. Contingency Fee Agreement for Legal Services

Kantor hired Baker Marquart and another law firm (collectively, Baker Marquart)1 to replace his former counsel who had been representing him in litigation against his stepmother and her accountant. In particular, Kantor sought to remove his stepmother and the accountant as trustees on certain family trusts of which Kantor was a beneficiary. Baker Marquart and Kantor executed a contingency fee agreement for legal services (fee agreement) that outlined their attorney-client relationship. According to the fee agreement, if 100 days had passed since execution of the fee agreement and Baker Marquart completed nine identified "minimum tasks," the contingency fee would increase from 30 to 35 percent of Kantor's "Recovery" as defined in the agreement.

The nine identified tasks (tasks) were: (1) "Decision made on whether to amend complaint in [the underlying lawsuit] to add claims such as accounting *733and/or other malpractice claims and, as necessary, a motion for leave to amend filed (not argued or heard)," (2) serve written special interrogatories within a specified timeframe, (3) serve requests for admissions within a specified timeframe, (4) serve form interrogatories within a specified timeframe, (5) serve requests for documents within a specified timeframe, (6) serve deposition notices within a specified timeframe, (7) request documents either informally or formally within a specified timeframe from transactional trust counsel, (8) serve deposition subpoenas and document requests within a specified timeframe, and (9) "Consultation with non-testifying, consulting art appraisal expert interviewed...."

The fee agreement also included an arbitration clause. According to the arbitration clause, the parties agreed to arbitrate "any dispute regarding [their] respective rights and obligations under [the] contingent fee agreement for legal services or regarding [the attorneys'] professional services or any other matter between" the parties. The arbitration clause specified two different types of disputes. On the one hand, the parties agreed that "disputes regarding the amount of the contingent fee and costs and expenses payable by [Kantor] under [the] contingent fee agreement for legal services will be resolved by arbitration conducted in accordance with the rules of the Beverly Hills Bar Association." On the other hand, the parties agreed that "disputes regarding all other matters, including matters related to [the attorneys'] professional services, conflicts of interest, and breach of fiduciary duty, will be resolved by binding arbitration conducted in Los Angeles, California either by ADR Services Inc. ('ADRS') or JAMS Inc. ('JAMS'), as selected by the party filing the claim, in accordance with the streamlined rules of JAMS."

The arbitration clause also stated the parties "agree to be bound by the decision of the arbitrator(s) and to waive the right to trial by judge or a jury and the right to *799appeal from the award of the arbitrator(s) or any judgment or order entered on the arbitration award." Further, the agreement provided "[a]ny arbitration award shall be final, binding and conclusive upon [Kantor], on the one hand, and [the attorneys], on the other hand, and shall be enforceable in all courts of competent jurisdiction."

B. Kantor's Recovery in Litigation and Baker Marquart's Fees

Following Baker Marquart's representation of Kantor, Kantor received over $1.6 million in settlement Recovery. Applying a 35 percent contingency rate, Baker Marquart received close to $600,000 in fees.

*734C. The Fee Arbitration

1. Kantor's Fee Arbitration Demand

Approximately one year after receiving his substantial recovery, Kantor filed a demand for fee arbitration against Baker Marquart (demand). In his demand, Kantor stated the contingency fee "was not to increase above 30% until 9 specified tasks were completed." Kantor alleged "Attorney[s] did not complete tasks 1 and 9." Accordingly, Kantor claimed the contingency fee of 35 percent was improper. He also claimed two additional billing errors, which are not relevant to this appeal. Other than tasks one and nine, Kantor's demand did not mention the remaining seven tasks listed in the fee agreement and did not claim any of the tasks, even if performed, were performed inadequately.2

2. Baker Marquart's Response to Kantor's Demand

Prior to the arbitration, Baker Marquart submitted a response to Kantor's demand. In its response, Baker Marquart addressed tasks one and nine. With respect to task number one-whether to amend the complaint to add accounting malpractice or other malpractice claims-Baker Marquart argued it had thoroughly considered the issue of adding malpractice claims against the accountant, had discussed it with Kantor, and had decided not to amend the complaint.

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Cite This Page — Counsel Stack

Bluebook (online)
231 Cal. Rptr. 3d 796, 22 Cal. App. 5th 729, Counsel Stack Legal Research, https://law.counselstack.com/opinion/baker-marquart-llp-v-kantor-calctapp5d-2018.