Enochs v. Brown, 3-93-279-CV

• Decision Date: 16 March 1994
• Docket Number: No. 3-93-279-CV,3-93-279-CV
• Citation: 872 S.W.2d 312
• Parties: Leland R. ENOCHS, Guardian Ad Litem for Justin Casey Vaught; and Frank Vaught, Appellants, v. Kimetha Chiesa BROWN, Individually, and as Next Friend of Justin Casey Vaught, Appellee.
• Court: Texas Court of Appeals

Page 312

872 S.W.2d 312

Leland R. ENOCHS, Guardian Ad Litem for Justin Casey Vaught and Frank Vaught, Appellants, v. Kimetha Chiesa BROWN, Individually, and as Next Friend of Justin Casey Vaught, Appellee.

No. 3-93-279-CV.

Court of Appeals of Texas Austin.

March 16, 1994.

Leland R. Enochs, Barkley Enochs & Pick, P.C., Taylor, for Justin Casey Vaught, appellant.

Paul T. Morin, Timothy Chambers, Austin, for Frank Vaught, appellant.

Jerry Galow, Whitehurst, Harkness, Watson, London, Ozmun & Galow, Austin, for appellee.

Before ABOUSSIE, JONES and B.A. SMITH, JJ.

BEA ANN SMITH, Justice.

Appellee Kimetha Chiesa Brown, individually and as next friend, filed a negligence suit against Jennie Davies for injuries suffered by her minor son, Justin Vaught, in an automobile-bicycle accident. Brown employed Jerry Galow of Whitehurst, Harkness & Watson (Whitehurst) to bring these claims. Frank Vaught, Justin's father, intervened in the action, and the court appointed a guardian ad litem, Leland Enochs, for Justin. The parties entered into a settlement agreement with Davies and her insurance carriers, but asked the trial court to apportion the settlement proceeds. Enochs and Vaught appeal the trial court's apportionment of the settlement proceeds and the award of attorney's fees to Whitehurst. We will affirm.

BACKGROUND

Justin's parents, Kimetha Brown and Frank Vaught, were divorced in 1983. Justin lived with Brown, who had been appointed his sole managing conservator. In July 1991, while riding his bicycle in Georgetown, Justin Vaught was hit by a car and suffered serious injuries, including permanent brain damage.

Brown and her husband, Chris Brown, signed a contingent fee agreement and employed Whitehurst to bring suit against Jennie Davies, the driver of the car. In January 1992, Whitehurst filed suit against Davies, representing Brown individually and as Justin's next friend.

Whitehurst rendered legal services resulting in the tender of $2,325,000 by various insurance companies. ¹ Davies' primary insurance carrier, Prudential Property and Casualty The following November, Justin's natural father, Frank Vaught, filed an intervenor's original petition both individually and as Justin's next friend, seeking damages for Justin's harm and his own. Both Vaught and the defendant asked the court to appoint a guardian ad litem for Justin. The court appointed Leland Enochs as guardian ad litem on November 19, 1992.

Insurance Company, tendered its policy limits of $300,000 after suit was filed in January 1992. In May 1992, after initially refusing to tender and characterizing this as a defensible case, Davies' excess carrier agreed to tender the limits of its umbrella policy in the amount of $2,000,000 in exchange for a release agreement. ²

In December, Davies filed a motion to enter into a confidential release and settlement agreement. In January 1993, the trial court signed an interlocutory take-nothing judgment against Brown, Enochs, and Vaught for any claims against Davies. On Brown's motion for judgment, the trial court heard evidence and apportioned the settlement proceeds. In its final judgment, the trial court awarded Brown $100,000 for past medical expenses, $50,000 for loss of companionship with Justin, and $211,577.72 for repayment of a contractual lien retained by Prudential for medical bills. The trial court awarded Vaught $15,000 for his loss of companionship with Justin, and awarded Enochs $15,000 for his services as guardian ad litem. It then awarded Justin the remainder of the proceeds, approximately $1.9 million, plus accrued interest, and ordered attorney's fees to Whitehurst of "a one-third fee on all money received on behalf of Justin Casey Vaught for its representation of Justin Casey Vaught."

Upon request, the trial court filed findings of facts and conclusions of law. Justin's guardian ad litem and his father appeal the trial court's judgment, challenging the division of the settlement funds and the award of attorney's fees to Whitehurst out of Justin's recovery. We will group Enochs' and Vaught's points of error into three categories: (1) the trial court's award of attorney's fees to Whitehurst based on the contingent fee contract; (2) the trial court's award of attorney's fees to Whitehurst based on the alternate ground of quantum meruit; and (3) the trial court's apportionment of settlement proceeds to Vaught and Brown for loss of companionship.

DISCUSSION

The Contingent Fee Contract

The trial court found that a valid contingent fee agreement existed between Brown, Justin's next friend and managing conservator, and Whitehurst for the firm to represent Justin in exchange for a fee of one-third of Justin's recovery. Both Enochs and Vaught challenge this finding and argue that the contingent fee contract was void under section 82.065 of the Government Code. Tex.Gov't Code Ann. § 82.065(a) (West Supp.1994) ("Government Code").

Vaught additionally argues that the contract is voidable, contending that adverse interests existed between Brown and Justin when the contract was executed and that a guardian ad litem should have been appointed at that time. The trial court found that Vaught had no standing to challenge the contract and therefore did not address Vaught's grounds for invalidating the contract. Vaught challenges this conclusion as well.

While Vaught may challenge the trial court's discretion in its apportionment of the settlement proceeds, he has no standing to challenge the validity or interpretation of the fee contract between Justin and Whitehurst. Brown was, and is, the sole managing conservator. The Family Code delegates to the sole managing conservator the exclusive right to represent a child in a legal action and to make substantial legal decisions. See Act of June 20, 1987, 70th Leg., R.S., ch. 744, § 5, 1987 Tex.Gen.Laws 2666, 2667 (Tex.Fam.Code § 14.02(a), since amended); Tex.Fam.Code Ann. § 12.04(7) (West Supp.1994) ; ³ Urbish v. 127th Judicial Dist. Court, 708 S.W.2d 429, 431 (Tex.1986). ⁴

Vaught did have the right to request that a guardian ad litem be appointed. See TEX.R.CIV.P. 173. He exercised that right ten months after suit had been filed and after Whitehurst had secured $2,325,000 in insurance proceeds for Justin. The court granted Vaught's motion to appoint a guardian ad litem. Enochs, as the guardian ad litem, rather than Vaught, had standing to challenge the validity of the fee contract on Justin's behalf. We therefore overrule Vaught's first, second, and third points of error.

In a related point, Enochs challenges the trial court's conclusion of law that by accepting the services of Whitehurst, Justin Vaught, by and through his guardian ad litem, is estopped from claiming that Whitehurst is not entitled to a fee. The trial court made findings of fact that Whitehurst provided valuable legal services to Justin by successfully handling his personal injury claim, and that Justin accepted, used, and enjoyed these services and the product of these services. These findings support the theory of quasi-estoppel. The principle of quasi-estoppel precludes a party from asserting, to another's disadvantage, a right inconsistent with a position he has previously taken. Steubner Realty 19, Ltd. v. Cravens Rd. 88, Ltd., 817 S.W.2d 160, 164 (Tex.App.--Houston [14th Dist.] 1991, no writ) (citation omitted). The doctrine applies when it would be unconscionable to allow a person to maintain a position inconsistent with one in which he accepted a benefit. Id. Misrepresentation by one party, and reliance by the other, are not necessary elements of quasi-estoppel. Vessels v. Anschutz, 823 S.W.2d 762, 765 (Tex.App.--Texarkana 1992, writ denied). In this case, it is unconscionable for Enochs, on Justin's behalf, to challenge the validity of the contingent fee contract when Justin has accepted the benefits of Whitehurst's services. See Estate of Grimes v. Dorchester Gas Producing Co., 707 S.W.2d 196, 205 (Tex.App.--Amarillo 1986, writ ref'd n.r.e.) (having accepted royalties under instrument, appellants are estopped from denying the validity of the "consolidation area" in that instrument); Baron v. Mullinax, Wells, Mauzy & Baab, Inc., 623 S.W.2d 457, 462 (Tex.App.--Texarkana 1981, writ ref'd n.r.e.) (appellant cannot claim contingent fee contract invalid for pending case while treating it as valid and receiving substantial benefits under it for other purposes). We overrule Enochs' fifth point of error.

Even if Enochs were not estopped from challenging the validity of the contingent fee contract, we would not hold the contract void under Government Code section 82.065(a). Section 82.065(a) requires that a contingent fee contract be in writing and signed by the attorney and client. Government Code § 82.065(a). While Brown, the client, signed the written fee contract, Galow, the attorney responsible for the case, failed to sign the agreement. However, the trial court concluded as a matter of law that the failure of the attorney to sign the contract "did not render it void or voidable, in light of the circumstances surrounding its execution." Were he not estopped, Enochs would challenge this conclusion of law.

We must construe section 82.065 and determine whether the legislature intended to make void or voidable a written attorney-fee contract signed by the client and fully performed by the attorney, but lacking the attorney's signature. To determine the legislative intent, we look to the language used and the purpose behind regulation of contingent fee contracts. Wilburn v. State, 824 S.W.2d 755, 760 (Tex.App.--Austin 1992, no writ) (citation omitted). Section 82.065 provides (a) A contingent fee contract for legal services must be in writing and signed by the attorney and client.

(b) A contingent fee contract for legal services is voidable by the client if it is procured as a result of conduct violating the laws of this state or the Disciplinary Rules of the State Bar of Texas...