Syllabus by the Court
The petition for attorney's fees, alleging the plaintiffs' performance of all the contracted services for which the defendant had given them two promissory notes, namely: services in connection with a divorce action against the defendant, which notes she refused to pay upon demand, where the case was in default, demanded a judgment for liquidated damages in the total amount of the notes less the amount awarded as attorney's fees in the divorce action.
Grady L. Dickey and Joseph B. Bergen brought an action against Mary Louise Budreau Mingledorff to recover $10,000 damages on two notes given them for their professional services as attorneys. The petition as amended alleged substantially as follows: That on March 14, 1963, the plaintiffs entered into a written contract with the defendant whereby they agreed to represent her in a pending divorce action in consideration of two promissory notes in favor of the plaintiffs, in the amounts of $8,000 and $2,000, copies of which are attached as exhibits to the petition; that these notes are payable on demand under the terms of the contract, a copy of which is attached as an exhibit to the petition, providing as follows: '1. That for and in consideration of the sum of $2,000, cash in hand, to be paid by the client as soon as possible after the sealing and delivering of these presents, the sufficiency whereof is hereby acknowledged by the attorney as an advance payment on a fee for legal services performed or to be performed with or without court or administrative action or litigation, but said sum is to be paid not later than the final termination of the client's divorce action now pending in the event of a lump sum alimony award, and if a lump sum is not awarded, to be paid in monthly installments of 50% of any monthly alimony payments awarded; and, 2. That for and in consideration of the client agreeing to pay the attorney an additional cash fee for legal services in the sum of $8,000, the sufficiency whereof is hereby acknowledged by the attorney, plus any balance due on the above $2,000, to be paid on the same basis, unless other assets are received from any source, including any interest available in property known as Dutch Island and Sylvon Island in said county, whereupon the full balance on said amounts shall become due and payable in full; but in such event, insofar as said islands are concerned, only upon conclusion of any litigation involving Dutch Island; and, 3. [Stricken]. 4. [Stricken]. 5. That for and in consideration of mutual covenants and promises from one to the other and the mutuality of the premises, and for other good and valuable consideration the client and the attorney do hereby agree, covenant, and contract as follows: (A) The client retains the attorney to represent the client as attorney-at-law of the client to perform all necessary and appropriate legal services (and to institute appropriate or necessary action or actions or other legal proceedings to completion) in the name of the client (to enforce the claim of the client against the proper defendant or respondent) (to recover damages sustained by the client) (or) (to defend the client) as a result of a divorce action now pending against the client and in
connection with Dutch Island and Sylvon Island, but under the condition set forth hereinafter insofar as said islands are concerned, and empowers the attorney to effect a compromise in said matter, or to institute such proceedings or legal action as may be advisable in his judgment; and, (B) The client hereby agrees to pay the attorney for services in connection with said islands a fee to be negotiated with other out-of-town counsel previously engaged, and agreeable with the within attorneys, if settled at any time prior to instituting such proceeding or action and without such proceeding or action, or a fee also to be so negotiated and agreeable with the within attorneys after any settlement, verdict, or recovery amount in said action or proceeding after being instituted, or a fee likewise so negotiated and so agreeable after any settlement or recovery with or without such proceedings or action, or verdict, in the event of counter or cross claims made by any party or parties, should the said out-of-town counsel also appear as an attorney in said claims on behalf of the client; if not, then the within attorneys are to represent the client in said claims on a straight 33 1/3% contingency fee basis; and, in addition, the client hereby agrees to pay all court costs, fees, expenses and disbursements, as they occur, which are not or are not found to be the obligation of others, in the performance of said services and in said proceedings or action from the date of this agreement, and to pay through the attorney all obligations which have occurred in connection with said occurrences before this agreement. (C) It is agreed that the attorney may retain his fee in full out of the amount finally collected by any proceeding or action, or settlement before or after such proceeding or action or judgment for his services, disbursements and obligations incurred, and which the client has not paid in full, before any division of said proceeds; and the attorney is hereby given a lien on the aforesaid claim, or action, any sum recovered by way of settlement and on any judgment decree, execution, garnishments, or by any other proceedings whatsoever that may be recovered thereon to insure the sums and shares hereinbefore mentioned due to the attorney or through the attorney, and the client expressly assigns to attorney, pro tanto, that is to say, for so much as may be necessary to pay said costs, fees, expenses, disbursement and obligations which are not the obligation of others, the aforesaid claim of the client and any sum realized by way of settlement, judgment, decree, execution, garnishments, or any proceedings whatsoever. (D) The client agrees that no settlement will be made except in the presence of the attorney and with the approval of the attorney and without the attorney receiving his share of said settlement for services rendered in accordance with this agreement; and should said matter be settled in violation of this agreement, the client agrees to pay the attorney the aforesaid sums and shares in full for services rendered to the date of said settlement, and should the claim or the defense of the client, as the case may be, be discontinued by the client for any reason whatsoever without settlement in accordance with this agreement, the aforesaid cash advances paid by client shall be kept by the attorney in full for such services to the date of the discontinuance. 6. The Aforesaid Paragraphs 1, 2 and 5, and Subparagraphs A-D as not deleted, are expressly included in the within agreement, and Paragraphs 3 and 4 and subparagraphs none as deleted, are expressly excluded from this agreement. 7. The attorney accepts and will accept the aforesaid payments on the conditions hereinbefore enumerated. 8. The client hereby binds the executors, legal representatives, assigns, and successors of the client to this agreement, and hereby states: All of the above contract has been read and all of its terms are fully understood.'
The petition further alleged that the plaintiffs had performed all their obligations under the contract; that on April 11, 1963, the defendant advised the plaintiffs that
she was not going to pay the plaintiffs the $10,000 and that she has breached the contract by a continued refusal to comply with the plaintiffs' demands for payment of the notes which are past due; that the plaintiffs claim a lien, for their professional services in connection with the aforesaid divorce action, upon the sum of $8,000 which the defendant received on deposit in the registry of the court following the verdict and judgment rendered in her favor in that action. The petition prayed for judgment against the defendant in the amount of $10,000 plus 5%* interest and for the award to them of the $8,000 on deposit in the registry of the court by the foreclosure of their attorneys' lien thereinbefore filed and separately recorded.
On May 8, 1964, the court entered the following order: 'On March 26, 1964, the court entered a default in this cause, fixing April 3, 1964, as the date for determining the amount of attorneys' fees that should be awarded to plaintiffs and against the defendant. The court feels that its position is sustained by Annotated Code Sections 9-611,...
