Krampe v. Krampe

510 So. 2d 1289
Louisiana Court of Appeal·Decided June 26, 1987·No. 86-981·Published·Cited by 4 cases

Opinion

510 So.2d 1289 (1987)

Catherine R. KRAMPE, Plaintiff-Appellee,
v.
Edward J. KRAMPE, Defendant,
Perrin, Landry, deLaunay, Durand & J. Minos Simon, Intervenors-Appellants.

No. 86-981.

Court of Appeal of Louisiana, Third Circuit.

June 26, 1987.
Writ Denied October 16, 1987.

Roy and Carmouche, H. Purvis Carmouche, Jr. and Harmon F. Roy, Lafayette, for defendant.

Voorhies and Labbe, John W. Hutchinson, Perrin, Landry, etc., Gerald C. deLaunay, Lafayette, Leslie J. Schiff of Sandoz, Sandoz and Schiff, Opelousas, for plaintiff-appellee.

*1290 Before FORET, KNOLL and CULPEPPER[*], JJ.

FORET, Judge.

This is a suit involving a disputed amount of attorney's fees pursuant to a contingency fee contract.

FACTS

The history of this case is somewhat lengthy. Plaintiff, Catherine R. Krampe, and defendant, Edward J. Krampe, were judicially separated on October 3, 1980. A community property partition was effected on October 6, 1980. The net value of the community property partition to Mrs. Krampe was $323,668.

On August 18, 1981, Mrs. Krampe employed J. Minos Simon, intervenor (hereinafter called Simon), to represent her and to take such legal action as he deemed necessary to revoke the community property settlement and partition agreement between Mrs. Krampe and her former husband. Mrs. Krampe and Simon signed a written Contract of Employment providing that Krampe would pay Simon attorney's fees in return for the legal services to be rendered by him. The fee agreed upon was "40% of recovery." The agreement was signed by both parties. During the summer of 1982, with Mrs. Krampe's approval, Simon associated the law firm of Perrin, Landry, deLaunay, and Durand (hereinafter referred to as PLDD) to handle the actual litigation. Pursuant to that agreement, Simon, by written assignment, assigned a 50% interest in the employment contract which he had with Mrs. Krampe. The employment contract and assignment of an interest to PLDD were later recorded in the Clerk of Court's office of Lafayette Parish, Louisiana.

After lengthy litigation, judgment was rendered on June 24, 1984, declaring the October 6, 1980 partition agreement between the Krampes null and void on the ground of lesion beyond moiety. The trial court rendered judgment in favor of Mrs. Krampe in the amount of $625,638.14. The trial court judgment further provided that should defendant fail to make a cash payment in that amount within a designated time period, the plaintiff, Mrs. Krampe, would be granted a one-half interest in all property comprising the community. Mr. Krampe failed to make the cash payment, and the judgment became executory. Thereafter, Mr. Krampe appealed to this Court. During the pendency of that appeal bearing docket # 84-831, Mrs. Krampe filed suit on October 4, 1984, seeking partition of the former community property under the provisions of La. R.S. 9:2801. Mrs. Krampe asserted that the net value of the community was $4,576,037.30. While the case was on appeal, Mr. Krampe made a settlement offer, ratifying the previous settlement of 1980 and additionally offering a $350,000 cash payment to Mrs. Krampe, which settlement offer Mrs. Krampe was willing to accept. However, after discussing the settlement offer with Simon and Gerald deLaunay of PLDD, she was strongly advised against accepting the offer, and the attorneys informed her that they would not consent to such a settlement.

On May 1, 1985, Mrs. Krampe terminated the legal services of Simon and PLDD by written letter and employed Leslie Schiff to represent her in concluding the settlement agreement. Mrs. Krampe and Mr. Krampe then entered into a written ratification and settlement agreement providing that each party ratify the October 6, 1980 settlement and partition agreement which they had previously signed according to the terms and conditions therein. Additionally, in order to conclude the entire matter, including the dismissal of the appeal by Mr. Krampe in this Court as well as the satisfaction of the judgment rendered by this Court, Mr. Krampe agreed to pay Mrs. Krampe $350,000 in cash.

Mr. and Mrs. Krampe filed a joint motion and order seeking approval of the proposed settlement agreement between the two parties. *1291 The ratification executed by Mr. and Mrs. Krampe contains a resolutory condition nullifying the entire agreement in the event that either court holds that the attorney's fees exceed $140,000 or 40% of $350,000.

The law firm of J. Minos Simon, Ltd. and PLDD intervened in the lawsuit to have their interests in the community formerly existing between Mr. and Mrs. Krampe recognized. A rule to show cause why the proposed compromise and settlement agreement between the Krampes should not be approved was filed on behalf of the Krampes jointly against the intervenors, J. Minos Simon, Ltd. and PLDD. Additionally, a motion for summary judgment was filed on behalf of the Krampes jointly against intervenors, and a motion for summary judgment was filed on behalf of the intervenors against the Krampes jointly. At the hearing on the petition of intervention and motion for summary judgment filed by Simon and PLDD, Mrs. Krampe endorsed the check of Mr. Krampe in the amount of $140,000 made payable to the Clerk of Court to be deposited in its registry as a tender to intervenors, representing attorney's fees due them as a result of their representation of her in the matters filed against Mr. Krampe. However, Simon and PLDD refused to accept the tender as payment in full.

The trial court denied the Krampes' joint motion seeking approval of the proposed settlement agreement because it found no authority in the Civil Code or in the jurisprudence to indicate that judicial approval was either necessary or permitted to effectuate a valid compromise. It furthermore denied all motions for summary judgment relative to the intervention. Consequently, the issues presented by intervenors were referred to the merits.

The trial court took the intervention proceedings under advisement on January 3, 1986. Reasons for judgment were rendered on January 9, 1986, concluding that the phrase "40% of recovery" as used in the employment contract between Mrs. Krampe and Simon meant 40% of what was recovered for Mrs. Krampe over and above what she already had; that $140,000 was a reasonable fee in this case and that anything in addition to that would be excessive and unreasonable; and that intervenors were not entitled to a privilege amounting to a 40% interest in the property acquired by Mrs. Krampe. Thereafter, intervenors took this appeal.

ISSUES
(1) While litigation is pending, and Mrs. Krampe's attorneys have been discharged, may the former attorneys prevent Mrs. Krampe from executing a settlement agreement with her former husband without their consent?
(2) What fees are due intervenors as a result of their professional services performed pursuant to an employment contract executed by Simon and Mrs. Krampe?

Initially, we recognize that compromise is favored in the law. Meinerz v. Treybig, 245 So.2d 557 (La.App. 3 Cir.1971), writ denied, 258 La. 580, 247 So.2d 395 (1971). The intervenors may not prevent the Krampes in the principal cause of action from settling their differences by means of a settlement agreement. La.R.S. 37:218 permits an attorney to contractually prohibit his client from settling, compromising, releasing, discontinuing, or otherwise disposing of a suit or claim without the written consent of the attorney. However, in Scott v. Kemper Insurance Co., 377 So.2d 66 (La.1979), our Supreme Court held that an attorney "...

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