Chuck Jones and MacLaren v. Williams

• Decision Date: 14 May 2003
• Docket Number: No. 24195.,24195.
• Citation: 71 P.3d 437,101 Haw. 486
• Parties: CHUCK JONES AND MacLAREN, a Hawai'i partnership, Plaintiff-Appellee, v. Deanna WILLIAMS, Individually and as Guardian of Shelley A. Williams, a minor; Shelley A. Williams, Defendants-Appellants.
• Court: Hawaii Court of Appeals

71 P.3d 437

101 Haw. 486

CHUCK JONES AND MacLAREN, a Hawai'i partnership, Plaintiff-Appellee, v. Deanna WILLIAMS, Individually and as Guardian of Shelley A. Williams, a minor; Shelley A. Williams, Defendants-Appellants.

No. 24195.

Intermediate Court of Appeals of Hawai'i.

May 14, 2003.

Certiorari Denied June 23, 2003.

Michael L. Freed, Leslie C. Maharaj, Honolulu, (Michael L. Freed & Associates), on the briefs, for defendants-appellants.

Ward D. Jones, (Ward D. Jones, AAL, ALC), Alexander T. MacLaren, Honolulu, (Alexander T. MacLaren, AAL, ALC), on the briefs, for plaintiff-appellee.

BURNS, C.J., LIM and FOLEY, JJ.

Opinion of the Court by LIM, J.

In this case of unpaid attorneys' fees, Defendants-Appellants Deanna Williams, individually and as guardian of Shelley A. Williams, a minor, and Shelley A. Williams (collectively, the Williams), appeal the March 5, 2001 first amended final judgment of the circuit court of the first circuit.¹ The judgment was based upon the court's September 11, 2000 order granting summary judgment in favor of Plaintiff-Appellee Chuck Jones and MacLaren, formerly a Hawai'i partnership of law corporations (CJM).

On appeal, the Williams complain that the court erred in granting summary judgment against them, because

(1) CJM failed to produce admissible summary judgment evidence showing the amount of attorneys' fees and costs it sought to recover or that the same were reasonable, (2) failed to establish the existence of an express contract with [the] Williams to provide them with legal services, and (3) a factual issue existed about CJM's standing to sue.

Opening Brief at 1.

We affirm the court's judgment on the issue of liability. We also affirm the court's award of some of the attorneys' fees and costs claimed by CJM. However, because a genuine issue of material fact existed as to the remainder of CJM's attorneys' fees and costs, we vacate that part of the court's judgment and remand.

I. Background.

On December 16, 1998, CJM filed a complaint against the Williams, seeking unpaid attorneys' fees. The pertinent allegations of the complaint follow:

COUNT I—BREACH OF CONTRACT

....

3. That on or about October 28, 1996, [CJM] and [the Williams] entered into an hourly fee agreement, which was also confirmed by way of a letter from [CJM]. Pursuant to that agreement, Defendant DEANNA WILLIAMS, individually and as legal guardian of SHELLEY A. WILLIAMS who was still a minor, contracted to hire [CJM] to represent her and her daughter in an action they had previously filed styled Deanna Williams, et al[.] v. Steve Silla et al[.], Civ. No. 96-3260-08 First Circuit Court, State of Hawai'i[] ("Silla action")[,] and a second action they had previously filed styled Deanna Williams et al[.] v. Na Pali Haweo Community Ass'n, Civ. No. 97-0916-03 First Circuit Court, State of Hawai'i[ ] ("NPH action"). The Silla action sought rescission of a contract to purchase an unimproved residential lot located in the Na Pali Haweo Subdivision in Hawai'i Kai, Honolulu, Hawai'i, and damages. The NPH action sought to compel a homeowners association to approve of home building plans which [the Williams] had submitted to it and damages.

4. The contract provided for hourly attorney's fees and repayment of any costs advanced which agreement also provided for a retainer of $3000.00 from which the first hourly fees would be deducted. [CJM] did substantial[ ] investigation, pretrial discovery including depositions on behalf of the clients as well as responding to pretrial discovery done by the opposition, pretrial motions, settlement negotiations, in both matters, an appeal in the NPH matter [ (sic) ], and preparation for and conduct of an arbitration hearing presentation in the Silla action. [CJM] billed [the Williams] on a monthly basis after the retainer was used up which [the Williams] did timely pay in both actions for about eighteen months up until approximately June 1998 and then began to fall behind. Nevertheless, [CJM] represented [the Williams] in both actions all the way through the Arbitration Hearing until the Silla matter was concluded and continued thereafter for a limited time on the NPH action which was still scheduled to go to trial.

5. Though [CJM] has repeatedly demanded payment, none have been received since June 8, 1998. As of the date of filing of this Complaint, [the Williams] are in arrears to [CJM] in the amount of $37,275.00 in fees owed in the Silla action and $4,020.00 [in] fees owed on the NPH action. [The Williams] are therefore in breach of the hourly fee agreement and jointly liable for damages to [CJM] in the amount of $37,275.00 and $4,020.00 for the Silla and NPH actions respectively for an aggregate sum of $41,295.00.

COUNT II—QUANTUM MERUIT/UNJUST ENRICHMENT

....

7. In the alternative, and based upon the above, [the Williams] have been unjustly enriched in the amount of the reasonable value of [CJM's] uncompensated legal services. [CJM] is therefore entitled to an award from [the Williams] in equity, under the doctrine of quantum meruit, in the amounts of $37,275.00 and $4,020.00 for the work done in the Silla and NPH actions respectively for an aggregate sum of $41,295.00.

WHEREFORE, [CJM] respectfully prays for judgment against [the Williams] jointly and severally as follows:

1. With respect to COUNT I, an award of damages in the amount of $41,295.00.

2. With respect to COUNT II, an award in equity in the amount of $41,295.00.

3. Attorney's fees and costs allowable by law along with prejudgment interest at the statutory rate.

4. Such other equitable relief as the Court deems just and meet in the premises.

(Italics and capitalization in the original).

In their October 25, 1999 answer, the Williams denied the material allegations of the complaint, asserted various defenses, and demanded a jury trial.

It appears that in early 2000, the parties submitted their attorneys' fees dispute to the Hawai'i State Bar Association Attorney-Client Committee for mediation. Mediation was apparently unsuccessful, because on July 28, 2000, CJM filed a motion for summary judgment. In its memorandum in support of the motion, CJM revealed further details regarding the underlying litigation:

The Silla case sought the rescission of a sales agreement between [the] Williams, as purchasers, and the seller/developer regarding the NPH Lot. The complaint alleged misrepresentation by the developer's sales person as to the quality of the lot's ocean view, allowable improvements, and the ease of obtaining the homeowners association's approval for home construction. The action, first filed in First Circuit Court, was eventually stayed and ordered to mandatory arbitration pursuant to a contractual provision in the real property sales agreement.

CJM was instructed to and did appeal the trial court's decision to enforce the mandatory arbitration clause. The appeal was unsuccessful. In the Silla case, CJM represented [the] Williams up through and including the arbitration hearing to judgment. The Defendants prevailed and the sale [was] upheld by the [arbitrator]. Throughout this time, [the] Williams [were] billed monthly on the agreed upon hourly rate of $175 an hour and the Williams paid these bills until about eight months prior to the arbitration. The Williams then started paying the bills more slowly and immediately following the unsuccessful arbitration stopped paying altogether, resulting in the current amount owing. The attorney's fees outstanding and owed to CJM amount to $37,275.35² for services performed in this action.

....

The NPH case was a corollary civil action to the Silla Case that sought injunctive relief, declaratory relief, and damages against the [NPH] Community Association ("NPHCA") for wrongfully withholding the approval of the Williams' house plans. The NPHCA's position was that the Williams' plans were not approved because the plans violated several recorded building covenants including those governing allowable maximum floor area ([the] Williams' house was allegedly too large) and prohibiting a flat roof design that was incorporated into the Williams' house plans. The Williams claimed that the NPHCA was not consistent nor fair in its enforcement of these building standards because other homeowners had been granted exceptions, and disputed the NPHCA's interpretations of these standards. CJM withdrew as attorneys for the Williams before the NPH Case went to trial due to the non-payment of attorney's fees; however, CJM participated in substantial discovery and preparation of the NPH Case while acting as counsel for the Williams under their hourly fee agreement. [The] Williams paid the bills associated with the attorney's time expended in the development of the NPH Case, except for a remnant of $4030.23. There is therefore an outstanding bill owed on the NPH case to CJM of $4030.23.

....

.... CJM, with the approval and encouragement of the Williams, deposed Owen Chock [ (Chock) ] for several days. [Chock] was an important witness since he was [NPHCA's] architectural expert and chairman of the NPHCA's architectural plan committee.... After [Chock] billed the Williams[ ] for his deposition witness fees as a professional (in the amount of $1979.04), [the] Williams reneged on their agreement to pay [Chock]. As a result, [Chock] has been seeking to collect this bill from CJM.

....

Just prior to the arbitration in the Silla Case, and after substantial negotiation, a final settlement offer of $50,000 was made by the developer and the NPHCA, without prejudice to [the] Williams' right to submit new house plans to the NPHCA. CJM believed the settlement offer was reasonable and CJM recommended that [the] Williams accept it. Instead, [the] Williams rejected the offer and prior to the commencement of the arbitration hearing, [the] Williams hired Mark Bernstein, Esq. [(Bernstein) ] to act as lead counsel in the Silla Case because [the] Williams [were] upset that CJM had recommended settlement and

...