Castle v. David Dorris Logging, Inc.
| Decision Date | 11 February 2013 |
| Docket Number | No. W2012-00917-COA-R3-CV,W2012-00917-COA-R3-CV |
| Parties | HOLLY CASTLE, INDIVIDUALLY, AND AS NEXT FRIEND OF EMILY CASTLE, A MINOR CHILD; AND JANA CLARK v. DAVID DORRIS LOGGING, INC., ET AL. |
| Court | Tennessee Court of Appeals |
Direct Appeal from the Circuit Court for Shelby County
No. CT-001806-07, Div. IV
This case involves a post-trial dispute between one party to a personal injury case and their former counsel. After a jury verdict was entered in favor of Appellants, their former law firm filed an attorney lien and a motion to recover its attorney fees in the trial court. Appellants asserted that the trial court lacked jurisdiction to consider the former firm's motion. The trial court disagreed and awarded the former firm its full requested fee. Appellants appeal both the award of attorney fees to its former law firm, and also the trial court's denial of Appellants' request to release funds held by the clerk. We conclude that the trial court lacked jurisdiction to consider the post-trial dispute and reverse the award of attorneys fees in this case. However, we affirm the trial court's denial of the motion to release funds. Reversed in part, affirmed in part, and remanded.
Tenn. R. App. P. 3. Appeal as of Right; Judgment of the Circuit Court Reversed in
Part, Affirmed in Part and Remanded
R. Sadler Bailey, Memphis, Tennessee, for the appellants, Holly Castle and Jana Clark.
Martin Zummach, Southhaven, Mississippi, for the appellee, Horne & Wells, PLLC.
Plaintiffs/Appellants Holly Castle, Emily Castle, and Jana Clark (collectively, "Appellants") were involved in a car accident with Defendants David Dorris Logging, Inc., and David Dorris, (collectively, "Defendants") on May 9, 2006. The Defendants stipulated to liability and a jury returned a verdict for the Appellants in the total amount of $350,000.00. Shortly after the jury verdict, Appellants fired their law firm, Appellee Horne and Wells, PLLC ("Horne and Wells"). The jury verdict was reduced to judgment on October 25, 2011. On October, 26, 2011, Appellants' new attorney entered a notice of appearance in the case. On the same day, Horne and Wells filed a notice of attorney lien on the jury verdict. Before hiring Horne and Wells, Appellants had previously fired attorney Ronald Krelstein in 2008. Mr. Krelstein also filed a notice of attorney lien in this case. Mr. Krelstein later filed a separate action to recover his attorney fees with regard to this litigation.1
On November 18, 2011, new counsel for the Appellants filed a Motion for New Trial, or, in the alternative, for Additur, arguing that the jury's verdict was against the weight of the evidence introduced at trial. On November 22, 2011, Defendants entered into a consent order, awarding Appellants their discretionary costs. On December 12, 2011, Defendants filed a response to Appellants' Motion for New Trial, denying that the jury's verdict was against the weight of the evidence. On December 30, 2011, counsel for Horne and Wells notified the Appellants' newly retained counsel that it intended to file a motion to recover attorney fees and costs. According to the briefs, the matter was set for hearing, but was later removed from the docket when Appellants' counsel informed Horne and Wells that he believed seeking attorney fees in such a manner was improper pursuant to Starks v. Browning, 20 S.W.3d 645 (Tenn. Ct. App. 1999), discussed in detail below.
On January 3, 2012, the trial court denied Appellants' Motion for New Trial, or, in the alternative, for Additur. On the same day, the trial court entered a Consent Order, under which the full amount of damages awarded to the Appellants would be paid to the Shelby County Circuit Court Clerk pending resolution of all claims for damages, whether claimed by the Appellants' former counsel or others. The order notes that both Horne and Wells and Mr. Krelstein had filed attorney liens regarding the funds paid into the Court Clerk. The order also refers to other claims on the funds, concerning loans entered into by Appellants, which are not the subject of this appeal.2 The order states:
IT IS, THEREFORE, ORDERED, ADJUDGED, AND DECREED that all funds necessary for the Defendants to satisfy the Judgments ($200,000.00 for Holly Castle and $150,000.00 for Jana Clark plus post-judgement interest) will be paid into an interest-bearing account, until the disputes between and among the various parties making claim to the Judgment proceeds are resolved and further Orders of this Court are entered directing distribution of the funds.
The order was signed by counsel for Appellants, Defendants, Horne and Wells, and Mr. Krelstein. The Defendants paid the owed amounts into the registry of the Circuit Court Clerk and a Satisfaction of Judgment was entered on January 11, 2012.3
On January 20, 2012, Horne and Wells filed its Motion to Recover Attorneys Fees and Costs. Horne and Wells attached its contract for legal services with the Appellants to the motion, which contract indicates that Horne and Wells was to receive forty percent of the total recovery if the case went to trial. Appellants filed a response in opposition on January 25, 2012, arguing that the motion was improper and that the trial court did not have jurisdiction to consider a dispute between one party to a lawsuit and its own attorney.
On January 27, 2012, the trial court orally ruled that it had jurisdiction to hear the dispute between Appellants and Horne and Wells regarding the attorney fee dispute. The trial court further directed Horne and Wells to provide documentation showing the amount of time spent working on the case in order to award Horne and Wells a reasonable attorney fee. On February 1, 2012, Horne and Wells filed several affidavits concerning its work on the case, as well as the affidavits of other attorneys concerning the reasonableness of the requested fee.
On February 7, 2012, counsel for the Appellants informed the trial court that he intended to file motions soon, but that a hearing on the motion for attorneys fees had not yet been set. The trial court informed counsel for the Appellants that it intended to file an order ruling on the attorney fee motion the following day. Accordingly, Appellants filed a Motion for Recusal, a Motion to Release Funds, and a Motion for Interlocutory Appeal on February 7, 2012. On February 8, 2012, the trial court entered an order granting Horne and Wells' anaward for attorney fees in the amount of $144,115.45. The trial court specifically relied on the consent order providing that funds would only be disbursed upon order of the trial court to conclude that it had jurisdiction over the dispute. The trial court then directed Horne and Wells to provide some documentation "that no other claims are made in objection to the attorney fees alleged by Horne and Wells [], to be due and owing in the amount of $144,115.45, other than those objections already presented by [Appellants] in response to the original motion." Horne and Wells complied by filing a "Statement of Interest" from both Mr. Krelstein and attorneys for the Defendants, in which they stated that they claimed no interest in and did not dispute Horne and Wells' $144,115.45 attorney fee award.
On February 16, 2012, Horne and Wells filed a response to the Appellants' pending motions. On February 24, 2012, a hearing was held on all pending motions. The trial court orally denied the motion to recuse and the motion to release funds. The trial court ordered additional briefing on the issue of whether a jury trial was required to award attorney fees. Ultimately, the trial court entered an order on March 20, 2012 denying Appellants' recusal motion, motion to release funds, and request for jury trial. The trial court entered another order on March 21, 2012 awarding Horne and Wells its full requested attorney fees. Appellants timely appealed.4
1. Whether the trial court erred in retaining jurisdiction over Horne and Wells' Motion to Recover and Receive Attorney Fees pursuant to Starks v. Browning, 20 S.W.3d 645 (Tenn. Ct. App. 1999) and then subsequently granting Horne and Wells' motion?
2. Whether the trial court erred in denying Appellants' motion for jury trial?
3. Whether the trial court erred in denying Appellants' motion for release of funds?
4. Whether the trial court erred in denying Appellants' motion for recusal?
Appellants' first argue that the trial court erred in retaining jurisdiction over the feedispute between Appellants and Horne and Wells based on Horne and Wells' attorney lien. Subject matter jurisdiction implicates a court's power to adjudicate a particular case or controversy. Osborn v. Marr, 127 S.W.3d 737, 739 (Tenn. 2004); Earls v. Mendoza, No. W2010-01878-COA-R3-CV, 2011 WL 3481007, at *5 (Tenn. Ct. App. Aug. 10, 2011). "In the absence of subject-matter jurisdiction, a court cannot enter a valid, enforceable order." Earls, 2011 WL 3481007, at *5 (citing Brown v. Brown, 281 S.W.2d 492, 497 (Tenn. 1955)). When subject matter jurisdiction is questioned, we must ascertain whether the Tennessee Constitution, the Tennessee General Assembly, or the common law have conferred upon the court the power to adjudicate the case before it. Id. (citing Staats v. McKinnon, 206 S.W.3d 532, 542 (Tenn. Ct. App. 2006)). "Since a determination of whether subject matter jurisdiction exists is a question of law, our standard of review is de novo, without a presumption of correctness." Northland Ins. Co. v. State, 33 S.W.3d 727, 729 (Tenn. 2000).
Attorney liens are governed by Tennessee Code Annotated Section 23-2-102, which provides that: "Attorneys and solicitors of record who begin a suit shall have a lien upon the plaintiff's or complainant's right of action from the...
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