Law Offices of Russell A. Kelm v. Selby

2017 Ohio 8239, 100 N.E.3d 108
CourtOhio Court of Appeals
DecidedOctober 19, 2017
Docket15AP-1135
StatusPublished
Cited by8 cases

This text of 2017 Ohio 8239 (Law Offices of Russell A. Kelm v. Selby) is published on Counsel Stack Legal Research, covering Ohio Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Law Offices of Russell A. Kelm v. Selby, 2017 Ohio 8239, 100 N.E.3d 108 (Ohio Ct. App. 2017).

Opinion

BRUNNER, J.

{¶ 1} Defendant-appellant/cross-appellee, Kenneth W. Selby, and plaintiff-appellee/cross-appellant, Law Offices of Russell A. Kelm ("the Kelm firm" or "the firm"), appeal from a judgment of the Franklin County Court of Common Pleas issued on November 30, 2015. Selby appeals the trial court's finding in favor of the Kelm firm on its claim for attorney fees. The Kelm firm appeals the trial court's award of attorney fees based on quantum meruit rather than a contingent fee. Because we find that the trial court did not abuse its discretion, we affirm its decision as to both parties.

I. FACTS AND PROCEDURAL BACKGROUND

{¶ 2} The parties in the underlying matter, the Kelm firm and a former client, Selby, challenge the trial court's resolution of their dispute over the payment and calculation of legal fees.

{¶ 3} Selby retained the Kelm firm to represent him in an age discrimination claim against his former employer, Abbott Laboratories ("Abbott"), which had terminated Selby's employment as part of a reduction in force action on January 28, 2014. At the time Selby contacted the Kelm firm, Abbott had tendered an offer of 28 weeks of severance payable on regular pay days, which would be suspended if Selby were re-employed, in which event Selby would receive one-half of the remaining balance as a lump sum. The severance offer was dated January 28, 2014 and expired by its own terms on March 28, 2014.

{¶ 4} On February 25, 2014, Selby signed a written contingency fee agreement with the Kelm firm, which provided in part for the firm to be compensated for one-third of any recovery from Abbott in excess of Abbott's January 28, 2014 severance offer, plus expenses.

{¶ 5} The Kelm firm entered into negotiations with Abbott on Selby's behalf beginning in March 2014. The firm negotiated the extension of Abbott's initial severance offer to April 11, 2014. The parties failed to reach a settlement by April 11, and Abbott's initial severance offer expired on that date. The firm continued to negotiate with Abbott on Selby's behalf beyond the April 11 expiration date, but it also moved forward with drafting a complaint and sent it to Selby on May 1, 2014. Selby did not authorize filing the lawsuit, and negotiations with Abbott reached an impasse.

{¶ 6} By mid-May 2014, Selby had found a new job, which effectively reduced his damages for lost wages to a claim for nine weeks pay, making a lawsuit financially unviable. The Kelm firm suggested negotiating for the $52,304.40 from the expired initial severance offer as a lump sum, regardless of Selby's employment status. Selby agreed, and the firm re-opened negotiations with Abbott. On July 11, 2014, Abbott sent a revised agreement offering a lump sum payment of the $52,304.40, without reference to Selby's employment status.

{¶ 7} The Kelm firm initially sent Abbott's revised severance offer to an incorrect email address for Selby. On July 23, 2014, the firm emailed the July 11, 2014 offer to Selby at his correct email address, advising that the statute of limitations on his age claim expired in a few days, and asking if he accepted the revised severance offer or wanted to proceed with a lawsuit. Selby responded by email on July 24, 2014, stating "[n]o not yet." (Aug. 6, 2015 Resp. to Req. for Produc. at LORAK-238.) In fact, Selby signed the new agreement on July 24, and returned it directly to Abbott's legal counsel, without advising the Kelm firm that he had signed it or providing the firm with a copy of the signed document. Selby moved out of Ohio in August 2014 to take up his new job.

{¶ 8} The Kelm firm followed up with another email to Selby on July 24, 2014. However, the record before the trial court indicates Selby did not respond to that email and did not communicate with the Kelm firm until November 2014.

{¶ 9} On August 11, 2014, the Kelm firm billed Selby for a contingent fee and expenses of $11,246.82. On November 3, 2014, the firm sent Selby a ten-day demand letter via email for payment of the amount invoiced on August 11.

{¶ 10} The firm claims that Selby failed to notify it of his new address, refused to communicate with it, and refused to pay any portion of the bill for services. The firm threatened to file suit to recover attorney fees and expenses and re-billed Selby for the full amount due for his services of $18,208.36.

{¶ 11} On November 18, 2014, the Kelm firm filed a complaint against Selby, alleging he did not pay for legal services pursuant to the contingency agreement dated February 25, 2014. The Kelm firm alleged breach of contract and a right to recovery in quantum meruit and requested judgment against Selby for the sum of $18,208.36, plus interests and costs. On December 23, 2014, Selby filed a motion to dismiss the complaint pursuant to Civ.R. 12(B)(6).

{¶ 12} By journal entry dated May 5, 2015, the trial court granted Selby's motion to dismiss in part and deny in part. The trial court dismissed the first count of the complaint for breach of contract, having determined that Selby had effectively discharged the firm when he proceeded to complete settlement with Abbott without notice to the firm. The trial court relied on the holding of Reid, Johnson, Downes, Andrachik & Webster v. Lansberry , 68 Ohio St.3d 570 , 629 N.E.2d 431 (1994), to conclude that the Kelm firm, as a discharged attorney, was limited to a quantum meruit recovery. The trial court denied Selby's motion as to the second count of the complaint seeking recovery under quantum meruit. Additionally, the trial court struck the jury demand because quantum meruit is an equitable action, and there is not a right to jury trial on an equitable action.

{¶ 13} On August 6, 2015, Selby filed a motion for summary judgment, arguing he was entitled to summary judgment because the Kelm firm's quantum meruit claim failed as a matter of law. He asserted the Kelm firm was not entitled to attorney fees under the theory of quantum meruit because he had never discharged the firm, which represented him through the date he accepted Abbott's final severance offer, and therefore was bound by the contingency fee representation agreement. Selby contends the Kelm firm and he fulfilled the terms of the contingency fee agreement. He argues that the firm failed to recover more than the amount of Abbott's initial severance offer; consequently, the underlying contingency failed to occur, and the firm could not, as a matter of law, recover under quantum meruit.

{¶ 14} On October 6, 2015, the trial court denied Selby's motion for summary judgment, finding that genuine questions of material fact existed as to whether the Kelm firm had been discharged.

{¶ 15} The remaining claim of quantum meruit was tried to the bench on November 24, 2015. The trial court's decision issued on November 30, 2015 included comprehensive findings of facts and conclusions of law. Having reviewed all the evidence and considered the credibility of the witnesses and the factors appropriate under Ohio law, the trial court found in favor of the Kelm firm.

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Cite This Page — Counsel Stack

Bluebook (online)
2017 Ohio 8239, 100 N.E.3d 108, Counsel Stack Legal Research, https://law.counselstack.com/opinion/law-offices-of-russell-a-kelm-v-selby-ohioctapp-2017.