Harrill & Sutter, P.L.L.C. v. Kosin

2012 Ark. 385, 424 S.W.3d 272, 2012 WL 4829815, 2012 Ark. LEXIS 407
CourtSupreme Court of Arkansas
DecidedOctober 11, 2012
DocketNo. 12-51
StatusPublished
Cited by17 cases

This text of 2012 Ark. 385 (Harrill & Sutter, P.L.L.C. v. Kosin) is published on Counsel Stack Legal Research, covering Supreme Court of Arkansas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Harrill & Sutter, P.L.L.C. v. Kosin, 2012 Ark. 385, 424 S.W.3d 272, 2012 WL 4829815, 2012 Ark. LEXIS 407 (Ark. 2012).

Opinions

DONALD L. CORBIN, Justice.

11Appellant Harrill & Sutter, P.L.L.C. (Harrill) appeals the orders of the Garland County Circuit Court (1) denying its motion to set aside a judgment pursuant to Ark. R. Civ. P. 60(c)(4) (2012), and (2) awarding attorneys’ fees to Appellee Cynthia Kosin on the basis that she was the prevailing party and that such fees were reasonable. As this is a second appeal, our jurisdiction is pursuant to Ark. Sup.Ct. R. l-2(a)(7) (2012). We affirm in part and reverse and remand in part.

The underlying facts of this case were set forth in Harrill & Sutter, PLLC v. Kosin, 2011 Ark. 51, 378 S.W.3d 135 (Harrill I). Suffice it to say, that at issue in Harrill I was the discharge by Kosin of the law firm Harrill & Sutter and what attorneys’ fees were owed following that discharge. Kosin had originally retained Harrill in connection with matters related to her late husband’s estate. As time progressed, however, Kosin became dissatisfied with Harrill’s services and fired the firm. Thereafter, Kosin retained Allison Cornwell and Byron Eiseman of Friday, Eldredge & Clark to represent her. After Kosin discharged the firm, Harrill filed |2suit against Kosin for breach of contract and sought an attorney’s lien against all sums recovered from the estate on Kosin’s behalf.

Cornwell was able to effectuate a settlement with the estate that resulted in an award for Kosin of approximately $550,000. A bench trial was held on Har-rill’s complaint. The circuit court ruled that Kosin discharged Harrill for cause and that, as a result, Harrill was entitled to a fee based only on quantum-meruit recovery. Kosin then sought an award of attorneys’ fees as the prevailing party. Ultimately, this court affirmed the circuit court’s ruling that Kosin had discharged Harrill for cause and any fee owed by her to Harrill was based on quantum-meruit recovery, and not the parties’ fee agreement. This court therefore affirmed the circuit court’s award of $55,775.44 in quantum-meruit recovery. But, this court reversed the circuit court’s ruling denying Kosin’s request for attorneys’ fees pursuant to Ark.Code Ann. § 16-22-308 (Repl. 1999), on the basis that the circuit court had provided no findings in support of its denial of such fees. We remanded the matter for a factual determination by the circuit court regarding the propriety of a fee award.

Upon remand, Kosin filed an amended motion pursuant to section 16-22-308 for payment of attorneys’ fees, as the prevailing party. Harrill responded that Kosin was not,entitled to attorneys’ fees, as she was not the prevailing party and such motion was untimely pursuant to Ark. R. Civ. P. 54(e). A hearing was held on June 14, 2011, regarding Kosin’s motion for attorneys’ fees. The court heard testimony from Kosin and attorneys Allison Cornwell and Philip Clay.

| ¡¡Cornwell testified that the Friday firm continued to represent Kosin after the estate case settled and initially prepared the pleadings after Harrill sued Kosin on the breach-of-contract claim. Cornwell stated that she initially believed she could settle the Harrill suit for her client before having to involve another attorney. Cornwell explained that once Clay had been brought in on the breach-of-contract action, it was still necessary for the Friday firm to bill Kosin because the attorneys had to meet with Clay to review the voluminous files in the case and to explain tax issues related to the case. Specifically, she stated, “It was very important once ... it was obvious we had to transfer the file, to educate and to provide all the knowledge that we had about the ‘for cause’ issue and the estate case[,] which was directly relevant to this case[,] to Mr. Clay as soon as possible.” Cornwell asserted that she considered the attorneys’ fees paid after Clay had been substituted to be related to Ko-sin’s defense and necessary.

Clay testified that Harrill had filed a breach-of-contract claim against Kosin, seeking an award of $225,000, but that Harrill ultimately received only about twenty-five percent of the amount sought- and, thus, in his opinion, Kosin was the prevailing party. Clay further stated that one of the central issues at the trial level had been whether Harrill had been discharged for cause, which the circuit found in favor of Kosin. Clay stated that Corn-well provided attorney services prior to his hiring and then in connection with the transfer .of the case file to Clay’s office. According to Clay, Cornwell’s, assistance was beneficial to the defense in that it helped him to understand the complexities of the tax issues involved in the underlying estate case. Clay stated that he would not classify Cornwell as co-counsel because |4that would be ethically improper because they knew Cornwell would be a witness in the case. Finally, Clay stated that if he were to categorize Cornwell’s role it would be as that of a consultant to him.

The circuit court entered an order on August 11, 2011, finding that Kosin was the prevailing party under Arkansas law, as she came out on top on most of the issues before the circuit court and in recovering seventy-five percent of the money in dispute. Thus, the circuit court granted Clay’s $36,023.98 fee as a reasonable attorney’s fee. Further, the circuit court found Cornwell’s fees from August 14, 2008, through October 12, 2009, to be reasonable and related to the defense of the contract action, and thus, awarded Kosin an additional $10,111.25 fee for the hours billed by Cornwell. This appeal followed.

For its first point on appeal, Harrill asserts that the circuit court erred in denying its motion to set aside the January 4, 2010 judgment, pursuant to Rule 60(c)(4). Harrill asserts that it had no knowledge that Cornwell continued as counsel for Kosin once Clay had been substituted as counsel. Thus, according to Harrill, “Had Ms. Cornwell been disclosed to be continuing as counsel for Ms. Kosin, Appellant would have objected to her testimony as a witness at trial. Or if the court had permitted her to testify over objection, the cross examination would have been remarkably different.” Harrill appears to premise his fraud argument on a violation of Ark. R. Prof 1 Conduct 3.7 by Cornwell that resulted in a “constructive fraud upon the Court.”

Kosin counters that the circuit court properly denied Harrill’s Rule 60(c)(4) motion as Harrill failed to point to any fraud within Cornwell’s testimony. Moreover, Kosin points |fiout that Cornwell refused to give an opinion, of any kind, about whether Harrill was “terminated for cause.” Finally, Kosin submits that there was no violation of Rule 3.7 that would have resulted in “constructive fraud” because Cornwell never acted as Kosin’s advocate at trial.

A circuit court may set aside a judgment for “misrepresentation or fraud ... by an adverse party.” Ark. R. Civ. P. 60(c)(4) (2012). It is within the discretion of the circuit court to determine whether it has jurisdiction under Rule 60 to set aside a judgment, and the question on appeal becomes whether there has been an abuse of that discretion. Grand Valley Ridge, LLC v. Metropolitan Nat’l Bank, 2012 Ark. 121, 388 S.W.3d 24; New Holland Credit Co. v. Hill, 362 Ark. 329, 208 S.W.3d 191 (2005).

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Bluebook (online)
2012 Ark. 385, 424 S.W.3d 272, 2012 WL 4829815, 2012 Ark. LEXIS 407, Counsel Stack Legal Research, https://law.counselstack.com/opinion/harrill-sutter-pllc-v-kosin-ark-2012.