Estate of Linnick

171 Cal. App. 3d 752, 217 Cal. Rptr. 552
CourtCalifornia Court of Appeal
DecidedAugust 27, 1985
DocketB006555
StatusPublished
Cited by6 cases

This text of 171 Cal. App. 3d 752 (Estate of Linnick) is published on Counsel Stack Legal Research, covering California Court of Appeal primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Estate of Linnick, 171 Cal. App. 3d 752, 217 Cal. Rptr. 552 (Cal. Ct. App. 1985).

Opinion

171 Cal.App.3d 752 (1985)
217 Cal. Rptr. 552

Estate of ALBERT ROYAL LINNICK, Deceased.
BERG, SPIRE, MILLER & FRAADE, Petitioner and Appellant,
v.
DAVID E. AGNEW, as Successor Administrator With the Will Annexed, etc., Objector and Respondent.

Docket No. B006555.

Court of Appeals of California, Second District, Division Seven.

August 27, 1985.

*755 COUNSEL

Jones & Wilson, William F. Flahavan, William John Rea, Jr., and Thomas T. Lui for Petitioner and Appellant.

Paul, Hastings, Janofsky & Walker, George E. Stephens, Jr., Peter K. Rosen and Jeffrey B. Valle for Objector and Respondent.

OPINION

JOHNSON, J.

The appellant appeals from an order of the probate court denying its petition for extraordinary attorney's fees. The central issues on *756 appeal are whether the respondent's petition in the underlying action to determine title to contested property was properly filed pursuant to Probate Code section 615 and whether the petition could have been brought pursuant to Probate Code section 851.5 even though the decedent had no claim to the property at the time of his death. Because we conclude the petition was improperly filed pursuant to Probate Code section 615 and could not have been brought pursuant to Probate Code section 851.5, we reverse the court's decision and order the court to refrain from taking any further action in this matter.

I. STATEMENT OF FACTS AND PROCEEDINGS BELOW

In 1977, the decedent, Albert Linnick, an attorney, entered into a contingent fee contract with Bankers Life Insurance Company (Bankers Life) to represent its interest in the sale of land owned by the company. Under this contract, Linnick's fee was to be based on the sale price received for the property.[1] It was agreed this fee would compensate Linnick for all the work he had performed in connection with this property both prior to and subsequent to the execution of the agreement. However, when Linnick died in 1978, the sale of the land had not yet occurred.[2]

After Linnick's death, the appellant, Berg & Spire, was retained by the executrix of the Linnick Estate (the Estate), Alice Holguin, to act as her attorney in the administration of the Estate. Ms. Holguin also authorized Berg & Spire to complete the work under decedent's contract with Bankers Life.[3] She turned over the case file on the matter.

Berg & Spire agreed to represent Bankers Life and entered into the same contingent fee arrangement with Bankers Life as had previously existed between Bankers Life and Linnick. The law firm was aware of this prior contractual arrangement. The only alteration was an agreement by Berg & Spire to pay Martin Bernstein, a representative of Bankers Life, $60,000 *757 allegedly for legal services rendered by him in relation to the property transaction.

In March 1979, the property was sold. Bankers Life agreed Berg & Spire was entitled to $209,000 in legal fees for services rendered by the law firm with regard to this transaction. Of this amount, $161,975 was paid outright in cash and $47,025 was to be paid at a later time when a note relative to the transaction was paid off. Of the sum received, Berg & Spire paid Bernstein the $60,000 fee agreed upon. The Estate did not receive any of this payment and did not know the law firm had received such payment until approximately February 1980.

On or about August 12, 1980, the Estate filed a civil action against Berg & Spire alleging breach of contract, money had and received, constructive fraud, and accounting. The Estate contended all the funds received by the law firm were assets of the Estate. Berg & Spire denied the Estate had any right to the fees received from Bankers Life and raised several affirmative defenses. Berg & Spire also filed a cross-complaint for indemnity and declaratory relief against Bernstein.

On January 7, 1982, the Estate filed a complaint under Probate Code section 615 requesting a citation be issued to Berg & Spire demanding it render an accounting of the legal fees paid by Bankers Life to the law firm and an order be issued that these fees be paid over to the Estate if the court subsequently found the funds received belonged to the Estate. The Estate also requested Berg & Spire not be permitted to deduct or withhold any amount of the fees on account of alleged attorney's fees owed by the Estate to the law firm for services rendered the Estate. Instead, Berg & Spire should be required to file a petition for extraordinary fees pursuant to Probate Code section 911.

On February 10, 1982, Berg & Spire responded to the petition. The firm's contentions included: (1) the probate court lacked jurisdiction to hear the matter, (2) the contract between Linnick and Bankers Life terminated upon his death, (3) the executrix had no authority to retain another attorney, Berg & Spire, to represent Bankers Life upon Linnick's death, (4) the fees paid Berg & Spire represented payment for services performed solely by Berg & Spire, and (5) even if some of the fees paid represented services performed by Linnick, the Estate was only entitled to the reasonable value of his services, not the entire amount.

On March 12, 1982, an evidentiary hearing was conducted. The probate court heard testimony from Jeffrey Berg, the central attorney for Berg & Spire, and Alice Holguin, the executrix during the events in dispute. After *758 this testimony, the court ruled in favor of the Estate. The court held it had jurisdiction in this matter and was obligated to make certain all proceeds properly belonging to the Estate were recovered. The court also stated Berg & Spire violated its fiduciary duty to the Estate when it represented Bankers Life at the same time it represented the Estate. Such representation created a conflict between the firm's own interest and the interest of the Estate. The court further stated the law firm thus erred by placing itself in this adversarial position with the Estate without a complete and total disclosure to the Estate and without bringing this arrangement to the attention of the court.

On May 27, 1982, the court ordered Berg & Spire to turn over the file that had been maintained by Linnick, pay over to the Estate the sum of $101,000, the amount received from Bankers Life, or post a bond in that amount, and file a petition for extraordinary fees. With respect to the latter two requirements, the court fashioned this order in this manner so the fees received by Berg & Spire would be under the jurisdiction of the court and the court could then determine what amount of the fees, if any, properly belonged to Berg & Spire based on its work for Bankers Life and what amount, if any, properly belonged to the Estate based on the work performed by Linnick before he died.

On January 13, 1983, Berg & Spire filed its petition for extraordinary fees raising the same contentions it had previously raised in briefs and arguments before the court.

The matter was heard on September 30, 1983. At the outset, Berg & Spire informed the court the petition for extraordinary fees although one in form was not one in fact since if this were an actual extraordinary fee petition, they would be seeking compensation for extraordinary work done on behalf of the Estate. However, in this case, the petition was ordered by the probate court as a means to determine the proper allocation of the fees received from Bankers Life.

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Bluebook (online)
171 Cal. App. 3d 752, 217 Cal. Rptr. 552, Counsel Stack Legal Research, https://law.counselstack.com/opinion/estate-of-linnick-calctapp-1985.