Amstead v. McFarland

• Citation: 632 S.E.2d 707,279 Ga. App. 765
• Decision Date: 13 June 2006
• Docket Number: No. A06A0001.,A06A0001.
• Parties: AMSTEAD v. McFARLAND.
• Court: United States Court of Appeals (Georgia)

279 Ga. App. 765

Page 707

632 S.E.2d 707

AMSTEAD v. McFARLAND.

No. A06A0001.

Court of Appeals of Georgia.

June 13, 2006.

Broughton & Fernandez, Allen L. Broughton, Roswell, for appellant.

McFarland & McFarland, Robert P. McFarland, Randall A. Meincke, for appellee.

ANDREWS, Presiding Judge.

Laura Lee Amstead appeals from the trial court's order denying her motion for recoupment of attorney fees from Robert P. McFarland Sr. (McFarland, Sr.), who originally represented her and her ex-husband, Robert Amstead, in their wrongful death claim arising from the death of their son, Alan, in a motor vehicle accident.

Following the signing of a contingent fee contract by Laura and Robert Amstead with McFarland, Sr. in March 2003, McFarland, Sr. filed a wrongful death action in June 2003, on behalf of Laura Amstead and Robert Amstead against several defendants.¹

A series of e-mails exchanged between Amstead and McFarland, Sr. in October and early November 2003, reflect that Laura Amstead had become concerned about her personal information being requested by the defendants during discovery, her fear of one of the defendants, and her increasing discomfort in having to deal with her ex-husband, and wanted out of the case. In response to her request to get out of the case, McFarland, Sr. advised her, via e-mail, that if she got out of the case, it would damage the chance of recovering for the life of her son. He told her he would need a "letter from you, not an e-mail, demanding that I move the court to have your [sic] removed as plaintiff in the case and stating that you will have no further involvement with the matter including distribution of funds which will go entirely to your ex-husband." (Emphasis supplied.) Laura Amstead's letter dated October 20, 2003, stated that "I am demanding that you move the court to have me removed as plaintiff in the case. I will have no further involvement with the matter including the distribution of funds which will go entirely to my ex-husband[,]" and it was received by McFarland, Sr. (Emphasis supplied.) McFarland, Sr. acknowledged during his testimony at the apportionment hearing in February 2005, that he never told Laura Amstead that she had the right to withdraw from the litigation but could still pursue a portion of the settlement pursuant to OCGA § 19-7-1.

On November 5, 2003, a withdrawal of Laura Amstead was filed by McFarland, Sr. in the wrongful death case, stating that Amstead "hereby withdraws as plaintiff of record. Any and all interest that she has in this case is transferred to ... Robert Alan Amstead."

In November 2004, a year after Laura Amstead's withdrawal from the case, McFarland, Sr. negotiated a settlement on behalf of Robert Amstead for $325,000 with the defendants and requested that Laura Amstead sign the settlement agreement, which she refused to do. That agreement stated that the full $325,000 was to be paid to Robert Amstead and his attorney, McFarland, Sr., and that Laura Amstead understood that, by executing the release, she was waiving any claims against the defendants. On November 29, 2004, McFarland, Sr. filed, on behalf of Robert Amstead, a motion to enforce settlement, arguing that Laura Amstead had transferred her interest to Robert Amstead and her signature on the settlement agreement was not necessary to settlement.

Laura Amstead received her service copy of this motion on November 30. She read it on December 1 and realized that she had the right to pursue part of the proceeds of the settlement because the motion quoted portions of OCGA § 19-7-1. She then demanded her portion.

Laura Amstead consulted with another attorney who began representing her on December 23, 2004. That same day, this attorney faxed a letter to McFarland, Sr. notifying him of the representation and asking him to hold all funds in trust, pending a hearing on the equitable apportionment issue. On December 29, 2004, the trial court's order enforcing the settlement was entered, reflecting that Laura Amstead had withdrawn as a party plaintiff and that Robert Amstead, through his counsel, McFarland, Sr., had negotiated a settlement for the limits of defendants' respective insurance polices and had executed a release and settlement agreement. Further, the order stated that Laura Amstead had refused to execute the agreement and was claiming an interest in the proceeds. The court directed that, upon receipt of the settlement proceeds, McFarland, Sr. deposit them in his escrow account and that he was "authorized to immediately receive his contracted fees and any authorized expenses of litigation." Notice was to be given to Laura Amstead to assert her interest in the proceeds within 30 days. On January 4, 2005, McFarland, Sr., on behalf of Robert Amstead, filed his notice of compliance with the court's order of December 29, and stated that his contracted fees totaled $108,333.34, one third of the total settlement proceeds. That same day, McFarland, Sr. filed a dismissal of all defendants in the case.

On January 7, 2005, new counsel filed his notice of appearance on Laura Amstead's behalf. On January 12, 2005, counsel filed Laura Amstead's motion under OCGA § 19-7-1(c)(6) for equitable apportionment of the settlement proceeds. On February 18, 2005, McFarland, Sr. filed his motion to stay distribution of funds to Laura Amstead only "until any issue of attorney fees is fully resolved." By order of March 30, 2005, the trial court entered its order staying distribution of any funds to Robert or Laura Amstead pending resolution of the dispute regarding attorney fees.

The pertinent parts of OCGA § 19-7-1 state:

(c)(1) In every case of the homicide of a child, minor or sui juris, there shall be some party entitled to recover the full value of the life of the child, either as provided in this Code section or as provided in Chapter 4 of Title 51.

(2) If the deceased child does not leave a spouse or child, the right of recovery shall be in the parent or parents, if any, given such a right by this paragraph as follows:

...

(C) If both parents are living but are divorced, separated, or living apart, the right shall be in both parents. However, if the parents are divorced, separated, or living apart and one parent refuses to proceed or cannot be located to proceed to recover for the wrongful death of a child, the other parent shall have the right to contract for representation on behalf of both parents, thereby binding both parents, and the right to proceed on behalf of both parents to recover for the homicide of the child with any ultimate recovery to be shared by the parents as provided in this subsection. Unless a motion is filed as provided in paragraph (6) of this subsection, such a judgment shall be divided equally between the parents by the judgment; and the share of an absent parent shall be held for such time, on such terms, and with such direction for payment if the absent parent is not found as the judgment directs. Payment of a judgment awarded to the parent or parents having the cause of action under this subparagraph or the execution of a release by a parent or parents having a cause of action under this subparagraph shall constitute a full and complete discharge of the judgment debtor or releasee....

(6) For cases in which the parents of a deceased child are divorced, separated, or living apart, a motion may be filed by either parent prior to trial requesting the judge to apportion fairly any judgment amounts awarded in the case. Where such a motion is filed, a judgment shall not be automatically divided. A post-judgment hearing shall be conducted by the judge at which each parent shall have the opportunity to be heard and to produce evidence regarding that parent's relationship with the deceased child. The judge shall fairly determine the percentage of the judgment to be awarded to each parent. In making such a determination, the judge shall consider each parent's relationship with the deceased child including permanent custody, control, and support, as well as any other factors found to be pertinent. The judge's decision shall not be disturbed absent an abuse of discretion.

(Emphasis supplied.)

Following the post-judgment hearing provided for in subsection 6, the trial court entered its order of March 30, 2005, finding that Laura Amstead did not waive her right to share in the wrongful death proceeds recovered by withdrawing as a plaintiff in the litigation, despite the language McFarland, Sr. included in the withdrawal, and that she was to be awarded 75 percent of the proceeds with Robert Amstead receiving the remaining 25 percent.²

On May 18, 2005, Laura Amstead's motion for recoupment of attorney fees was filed. By order of June 23, 2005, after consideration of "oral arguments, all matters of record[,] and the applicable and controlling law," the trial court denied the motion for recoupment of attorney fees, concluding that Laura Amstead was bound by the fee agreement which she and Robert Amstead had signed with McFarland, Sr.

That agreement, signed on March 26, 2003, between "Client" (Laura Amstead and Robert Amstead) and "Attorney" (McFarland, Sr.) provided in pertinent part, that

[t]he Attorney will receive one-third (33.33%) of the net amount paid in satisfaction of any ultimate judgment or compromise settlement proceeds .... Any settlement would require the proceeds to be placed in the Escrow Account of McFarland & Associates, P.C. Then the Attorney will prepare a final distribution in accordance with this agreement. Both parties will execute the distribution agreement and then the Attorney will distribute in accordance with the list.

(Emphasis supplied.)

1. McFarland, Sr. urges the "any evidence" standard of review, while Amstead argues that the "plain legal error" standard of review is applicable. Because the trial court's order does not reflect that any evidence was taken at the hearing on the fee issue,³ but is premised solely upon the...