Babun v. Stok Kon + Braverman

• Decision Date: 27 October 2021
• Docket Number: 3D21-234
• Parties: Sara Cristina BABUN, etc., Appellant, v. STOK KON + BRAVERMAN, etc., et al., Appellees.
• Court: Florida District Court of Appeals

335 So.3d 1236

Sara Cristina BABUN, etc., Appellant,

v.STOK KON + BRAVERMAN, etc., et al., Appellees.

No. 3D21-234

District Court of Appeal of Florida, Third District.

Opinion filed October 27, 2021

Luis E. Barreto & Associates, and Luis E. Barreto ; The Billbrough Firm, and G. Bart Billbrough, for appellant.

Stok Kon + Braverman, and Robert A. Stok, Joshua R. Kon and Natasha Shaikh (Fort Lauderdale); Lubell Rosen, LLC, and Liz C. Messianu and Patricia D. Blanco; Law Offices of Scott Margules, P.A., and Scott Margules, for appellees.

Before SCALES, HENDON, and MILLER, JJ.

HENDON, J.

The appellant, Sara Cristina Babun, ("Sara"), as Personal Representative of the Estate of Jose Babun Selman ("Estate"), and as Co-Trustee of the Jose Babun Selman Third Amended and Restated Trust ("Trust"), respondent below, appeals from a final order awarding attorney's fees to Stok Kon + Braverman, and Franco & Associates, P.A., (collectively, the "Appellees") on behalf of Cristina Larach Babun ("Cristina"). We reverse the award of interim fees and costs and remand for a hearing in order to make the required evidentiary findings sufficient to support the award pursuant to Florida Patient's Compensation Fund v. Rowe, 472 So. 2d 1145 (Fla. 1985).

Facts

Sara is the daughter of Cristina and Jose Babun Selman (the "deceased"). Cristina is the deceased's spouse. In 2019, Sara petitioned to be appointed as personal representative of the Estate of Jose Babun Selman, and co-trustee of the Jose Babun Selman Third Amended and Restated Trust. Over Cristina's objections, Sara was appointed to be personal representative. Cristina then hired the Appellees to represent her and filed an adversary proceeding against the Trust. The court appointed a neutral co-trustee (Phil Schechter).

With the adversary issues raised by Cristina still outstanding, the Appellees filed a petition for their fees for work as Cristina's counsel between January 1, 2019 and August 31, 2020, seeking a total of $624,751.41 ($473,094.25 for the Trust litigation, $10,753.14 in costs; $53,500.00 for the Estate proceeding, $87,404.02 in costs). In October 2020, Sara objected to the Appellees’ fees, citing the still-outstanding adversary claims against the Trust, which had not yet been adjudicated. Further, earlier that year, in April 2020, Sara had filed a petition to determine Cristina's capacity, as well as Cristina's competency to retain Appellees to represent Cristina in those proceedings.

The trial court conducted an evidentiary hearing on Appellees’ fee petition. The Appellees argued that they had conferred a substantial benefit on the Estate and Trust and were entitled to compensation for their submitted work times. Sara, on the other hand, argued that the Appellees’ fee application was premature, the statutory law required a prevailing party, there was no determination on the merits and thus no basis for entitlement to interim attorney's fees and costs at that time. Further, Sara argued, the Appellees had not conferred any benefit on the estate to warrant fees.

Appellees, via attorney Stok, testified that Appellees’ work to secure the appointment of an independent trustee, securing living expenses for Cristina, and discovering fraudulent transactions, among other things, benefitted the Estate. Beyond simply introducing the billing record, however, no testimony was presented by Appellees, expert or otherwise, as to any of the lodestar factors required by Florida Patient's Compensation Fund v. Rowe, 472 So. 2d 1145 (Fla. 1985). Attorney Stok conceded that in connection with the three cases in which he represented Cristina, there had been no judgments yet rendered in her favor. There was no testimony about customary fee rates, who did what, reasonable time expended, and on what tasks, etc. There was no testimony regarding costs incurred during the estate or trust litigation. Phil Shechter, as independent co-trustee, testified that he had reviewed Appellees’ timesheets and noted they did not break down the fees sought by each litigation or for the topics of discovery, disqualification of counsel, elective share, or any other issue.

The trial court ultimately entered an order in November 2020, determining Cristina lacked capacity to retain the Appellees in those proceedings, and later entered a final order in December 2020, determining that Cristina was incapacitated, lacked the ability to contract, among other things, and appointed a professional guardian to protect Cristina's rights found in need of protection. These proceedings triggered a number of appeals initiated by the interested parties to this Court, but they were all either dismissed or abandoned by voluntarily dismissals.¹

The Appellees agreed they did not organize their timesheets in any particular order or specificity. Appellees’ fee expert, Lawrence Franco, who also testified, concluded that the fees were often too high or duplicative, but overall achieved the goal for the client Cristina (not the Estate). He did not testify as to experience level of the lawyers who worked on the case, whether the rates charged by each lawyer were customary and reasonable, or whether the time increments expended were reasonable in relation to the tasks performed. There was no identification of the lodestar amounts, either by hourly rate or reasonable number of hours, and no testimony presented regarding why the costs claimed were taxable. As conceded even by attorney Stok's expert witness, the Appellees’ bill was presented in the form of "block billing," i.e., billing that often fails to identify what services are connected with what unit of time billed for.

The trial court noted that the Appellees had represented Cristina in these cases, that the litigation was ongoing, and the fee application was for interim legal fees, and rejected Sara's argument that there was a prohibition on consideration of interim fees. Despite Appellees’ representation of Cristina and not the Estate itself, the trial court held this was not an absolute bar to a claim for legal fees if it was demonstrated that the legal services worked a benefit to the Estate and the Trust.

The court concluded that 1) Appellees must identify with particularity those time and expense items associated with the disqualification (of Sara's counsel) issue and eliminate those items from Appellees’ bill; 2) because litigation was ongoing, Appellees’ request for compensation was premature and would be "held in abeyance" until it could be demonstrated how the work benefitted the Estate; and 3) benefits to Cristina were, to some degree, a consequence of Appellees’ representation. However, before the court could ascertain such compensable activity, Appellees would need to resubmit their fee petition "identifying with specificity those services provided to Cristina that also served the larger purpose of vivifying Jose Babun's intent as testator and settlor[.]" Finally, the court determined that because Appellees’ legal work led to the appointment of co-trustee Philip Shechter, whose work benefitted the Estate, Appellees’ time expended to secure the appointment of the co-trustee and assist him in discharging his duties should be compensated. The court required the Appellees to submit a new fee application specifically identifying the time associated with those efforts. The Appellees did submit a new fee petition, to which Sara objected, alleging the new fee application did not remedy the problems of the first fee application...