Dukes v. Matheny

878 So. 2d 517, 2004 La. App. LEXIS 337, 2004 WL 324706
CourtLouisiana Court of Appeal
DecidedFebruary 23, 2004
DocketNo. 2002 CA 0652
StatusPublished
Cited by4 cases

This text of 878 So. 2d 517 (Dukes v. Matheny) is published on Counsel Stack Legal Research, covering Louisiana Court of Appeal primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Dukes v. Matheny, 878 So. 2d 517, 2004 La. App. LEXIS 337, 2004 WL 324706 (La. Ct. App. 2004).

Opinion

|2PARRO, j.

In this case concerning a fee dispute between two attorneys, one attorney appeals from the trial court judgment on the principal demand that divided equally a contingent fee between him and the other attorney based on an oral fee-sharing agreement. For the following reasons, the judgment of the trial court on the principal demand is reversed.

Facts and Procedural History

Attorneys James A. Dukes (Dukes) and Gordon W. Matheny (Matheny) enjoyed a close personal and professional relationship for fifteen or more years. For many years, Dukes shared Matheny’s office space, a secretary, office supplies, and equipment, with the agreement that Dukes would not handle any personal injury cases. During that time, the two men often referred cases to one another, sharing the collected fees on a 50/50 basis [519]*519pursuant to an oral understanding. One of the personal injury cases Dukes referred to Matheny concerned an automobile accident in which Paul M. Maklary’s wife was involved. Dukes had a longtime friendship with Maklary and had previously formed an attorney-client relationship with him.

In September 1996, Maklary was injured in an industrial accident while employed as an electrician at a plant operated by Payne & Webber. The accident involved the release of a poisonous gas at the job site. Someone approached Mak-lary about being represented by the law office of Don Carmouche in connection with the accident. Maklary indicated he was not interested. After going to see Dukes at his new office,2 Maklary signed a retainer agreement with Matheny on August 25, 1997. Although Dukes’ name was placed in the “referred by” portion of the retainer agreement, he was not a party to the agreement. Subsequently, Matheny partnered with Don Carmouche (Car-mouche) because of his familiarity with the litigation involving this industrial accident. Maklary was later contacted by Car-mouche, who advised Maklary that he would now be representing Maklary in the suit involving the industrial accident, pursuant to an agreement that Matheny had with Carmouche.

1¡¡Maklary eventually settled his suit for $700,000, generating a total legal fee of $272,125.74. Pursuant to the agreement between Carmouche and Matheny, the legal fee was divided on a 50/50 basis between Carmouche and Matheny. When Dukes inquired about his portion of the fee, Matheny took the position that he was not entitled to share in the fee. Subsequently, Dukes’ attorney sent a letter to Matheny demanding payment of 50 percent of the total fee in accordance with their handshake, fee-sharing agreement, which allegedly was in the nature of a joint venture. Initially, Dukes maintained that Matheny did not have authority to dilute the fee by bringing Carmouche into the arrangement.

Dukes filed a petition for declaratory judgment against Matheny based on the handshake agreement between these attorneys to split fees on matters referred to each by the other. Matheny maintained that no referral and/or fee-sharing agreement existed at the time Maklary retained him to pursue his chemical exposure claim. After a trial in this matter, the trial court found that Dukes was entitled to a referral fee equal to one half of the fee collected by Matheny in the Maklary matter. Subsequently, a judgment was entered in Dukes’ favor for a net sum of $49,262.02 against Matheny.3 This appeal followed. On appeal, Matheny contends that the trial court manifestly erred in finding that he owed compensation and/or a referral fee to Dukes in the Maklary matter. He further argues that the trial court legally erred in not applying Rule 1.5(e) of the Rules of Professional Conduct.

Applicable Law

Louisiana courts have generally refrained from examining professional contracts between attorneys who agree to share legal fees to determine whether one attorney performed more work than the other. Rice, Steinberg, & Stutin, P.A. v. Cummings, Cummings & Dudenhefer, 97-1651 (La.App. 4th Cir.3/18/98), 716 So.2d 8, 12, writ denied, 98-1328 (La.6/26/98), 719 So.2d 1288. A joint venture theory was [520]*520used by the court in McCann v. Todd, 203 La. 631, 14 So.2d 469 (1943), to resolve an attorney [4fee division dispute where the attorneys had jointly undertaken to represent their client in a lawsuit. The court in McCann recognized that absent an agreement to the contrary, the attorneys are entitled to share equally in the compensation. In such a case, the amount of time and labor furnished by the two attorneys is immaterial to the division of fees. McCann, 14 So.2d at 472. The courts have continued to apply the joint venture theory to uphold an agreement to share fees where two attorneys have executed a single contingency fee contract with the client. In such cases, the finding of a joint venture has been based on the fact that neither attorney has been discharged and both were actively involved in the case and remained responsible to their client. See DeFrancesch v. Hardin, 510 So.2d 42, 45 (La.App. 1st Cir.), writ denied, 513 So.2d 819 (La.1987); see also Krebs v. Mull, 97-2643 (La.App. 1st Cir.12/28/98), 727 So.2d 564, 569, unit denied, 99-0262 (La.3/19/99), 740 So.2d 119; Rice, Steinberg, & Stutin, P.A., 716 So.2d at 11; Fontenot & Mitchell v. Rozas, Manuel, Fontenot & McGee, 425 So.2d 259 (La.App. 3rd Cir.1982), unit denied, 432 So.2d 268 (La.1983).

Furthermore, in Scurto v. Siegrist, 598 So.2d 507 (La.App. 1st Cir.), unit denied, 600 So.2d 683 (La.1992), the retained attorney had entered into an agreement with another attorney to divide the legal fee. The retained attorney who sought to recover his share of the contingency fee, Scurto, was obligated by the agreement to manage the client, as well as to advance costs. Furthermore, Scurto was actively and continually involved with the case by frequently communicating with the client, advancing all expenses he was requested to pay, researching jurisprudence and statutory law, and attending depositions on behalf of his client. Scurto, 598 So.2d at 510. In light of the evidence presented, this court found that the attorneys were in a Duer situation, that is, two attorneys not of the same firm jointly representing a client. See Duer & Taylor v. Blanchard, Walker, O’Quin & Roberts, 354 So.2d 192, 194-195 (La.1978). This court held in Scurto that, because the retained attorney had associated, employed, or procured the employment of the other attorney to assist him in handling a case involving a contingency fee, the agreement regarding the division of the contingency fee was a joint venture. Scurto, 598 So.2d at 510. The court further | Indicated that the Rules of Professional Conduct do not prohibit the enforcement of such an agreement and would not require the apportioning of the fee on a quantum meruit basis when the attorneys are in a Duer situation. Scurto, 598 So.2d at 510. Accordingly, the agreement between the attorneys to divide the fee was held to be valid and enforceable. Scurto, 598 So.2d at 510.

However, the courts have declined to apply the joint venture theory to support an equal division of the fee when the attorneys have not been jointly involved in the representation of the client. See Brown v. Seimers, 98-694 (La.App. 5th Cir.1/13/99), 726 So.2d 1018, 1022, writ denied, 99-0430 (La.4/1/99), 742 So.2d 556; see also Matter of P & E Boat Rentals, Inc.,

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Cite This Page — Counsel Stack

Bluebook (online)
878 So. 2d 517, 2004 La. App. LEXIS 337, 2004 WL 324706, Counsel Stack Legal Research, https://law.counselstack.com/opinion/dukes-v-matheny-lactapp-2004.