Frank v. Bloom
| Decision Date | 05 November 1980 |
| Docket Number | 79-1062,Nos. 79-1061,s. 79-1061 |
| Citation | 634 F.2d 1245 |
| Parties | 7 Fed. R. Evid. Serv. 1059 John C. FRANK, Plaintiff-Cross Appellant, v. Victoria BLOOM, Defendant-Appellant. |
| Court | U.S. Court of Appeals — Tenth Circuit |
Ronald K. Badger, Wichita, Kan., for defendant-appellant.
D. Lee McMaster of McMaster & Smith, Wichita, Kan., for plaintiff-cross appellant.
Before DOYLE, McKAY and LOGAN, Circuit Judges.
John C. Frank, the plaintiff-appellee and cross-appellant, originally brought an action against Victoria Murdock Bloom, the defendant-appellant, to recover his attorney's fees for services rendered to Mrs. Bloom during a period starting June 4, 1971 and continuing to April 10, 1973. Frank's claim was for $107,000. The cause was tried before a jury which rendered a verdict in the amount of $85,000. Mrs. Bloom has appealed the final judgment based upon this award. Frank has filed a cross appeal from the trial court's order disallowing pre-judgment interest on the award.
Frank was originally hired by Mrs. Bloom to represent her interest in the Murdock litigation which is also pending in this court. Mrs. Bloom was a member of the Murdock family which owned a newspaper in Wichita, Kansas. The paper had been in the Murdock family since the newspaper was originally founded by Mrs. Bloom's grandfather, Colonel Marshall Murdock, in 1872. When he died in 1914 the newspaper was inherited by his three children, Marcellus, Victor and Pearl. Each received one-third. Victor's one-third passed to his daughter, Katherine Henderson, and his grandson, Victor Delano. Pearl's one-third share passed to her grandson, Harry B. Brown. Victoria's father, Marcellus Murdock, following his death on March 10, 1970, left his share in a trust which he had created during his lifetime. He placed one-half of his interest in the paper, or one-sixth of the stock, in that trust. The trust created five shares, one for his widow and one for each of his four children. In 1966 Marcellus Murdock created a testamentary trust. In this he provided five shares, one for his widow and one for each of his children. The remaining one-sixth share of stock of the newspaper was willed to the testamentary trust.
There were six surviving heirs of Marcellus - his widow Paula, his three children, Marshall Murdock, Janet Jennings and Victoria Bloom, and two grandchildren of Jane, his deceased daughter, Vici McComb and David Colwell.
Frank was employed by Victoria Bloom on June 4, 1971 in connection with litigation concerning the interest which the widow of Marcellus, Paula, was entitled to receive from the estate. This dispute was litigated in state court in Wichita. It centered on the interpretation and validity of an Anti-Nuptial Agreement executed in 1940, a Will executed in 1966 and a Codicil to the Will executed in 1967. The widow, Paula, took the position that she was entitled to one-half of the estate. The son, Marshall, here contended that Paula was entitled to one-fifth of the estate in accordance with the Anti-Nuptial Agreement. Victoria Bloom disputed the claim of Paula that she was entitled to one-half and contended that she should receive nothing at all.
A provision in the Will of Marcellus stated that Paula should receive nothing if she and Marcellus were not living as husband and wife at the time of his death. The facts were that Marcellus, after having lived with Paula for 24 years, moved out of the family residence. She, however, continued to live there until Marcellus' death. The trial court determined that Paula was entitled to a one-fifth share in accordance with the Anti-Nuptial Agreement.
This decision was affirmed by the Supreme Court of Kansas which held that the clause in question encouraged separation and was on that account contrary to public policy and unenforceable.
The trial judge in the will or widow's case awarded plaintiff-appellee Frank the sum of $48,000 for his services in the estate proceedings. Later the state supreme court ruled this sum to be not payable out of the estate. It did not comment on the reasonableness of the award.
There was also litigation concerning the voting rights of the trustee. The beneficiaries of the trust sought to have the bank vote the stock in accordance with their wishes. The bank refused, however, to do so. Mrs. Bloom's position was the same as that of the bank: that the trustees should vote according to their own discretion, and not necessarily in accordance with the wishes of the beneficiaries.
A third trial arose in connection with the sale of the newspaper to Ridder Publications, Inc. This action was brought by Victor Delano seeking an injunction against the sale of the newspaper and requesting damages from all other shareholders. The court did not enjoin the sale of the newspaper. It was during this injunction trial that Frank withdrew as the attorney for Mrs. Bloom. He testified that Mrs. Bloom insisted that he call her as a witness and ask her questions which she had previously prepared but had refused to allow Frank to review. He advised her that she was not needed as a witness since the hearing was limited. After denial of the injunction the newspaper was sold to Ridder Publications for $42,000,000.
At the outset of the Bloom-Frank relationship the understanding was that Frank was to be paid fees based upon the hourly rate of $50.00 per hour. Frank's contention is that this contract was modified early in the relationship. Mrs. Bloom testified that she was approached by Frank with the suggestion that he seek his fees from the estate with the understanding that if the estate was not held liable he would seek to be paid by Bloom. Bloom maintained that Frank informed her that all of the attorneys were seeking to be paid by the estate and asked her if she wished for him to do the same. Frank's version was similar, with the exception that he claimed that it was Bloom who approached him with the idea of his seeking his fees from the estate. Frank said that he did not give Bloom an answer until he had thought about and researched the issue. He said that at some later date he advised her that he would seek payment from the estate and have the court allow the fee; that he would no longer bill her on a regular basis. Frank also testified that he and Bloom agreed that if the court refused to grant the fees from the estate he would continue to look to Bloom for payment and that his fees would be what he considered to be reasonable and could be more or less than the $50.00 per hour.
The testimony on behalf of Mrs. Bloom as to the fee arrangement generally was that her contract with Frank was for $50.00 per hour, and that this contract never changed. She maintained that nothing was said about changing the $50.00 hourly rate to be charged nor was there anything said about the court setting the fee. She understood that Frank would try to get his fee from the estate at the $50.00 per hour rate. She understood that if the estate did not pay that she would have to pay as originally agreed, i. e. $50.00 per hour.
In his counterclaim Frank alleged that the reason for the change in the fee arrangement was Mrs. Bloom's excessive demands on his time. In his answer he claimed that in an itemized statement he told Mrs. Bloom that the excessive demands on his employment by her were placing a severe burden on his law practice and that he would prefer to withdraw. The answer further stated that Mrs. Bloom encouraged him to continue to represent her and indicated her willingness to forego the hourly fee contract and replace it with a reasonable compensation arrangement. Frank also testified at the trial that he told Mrs. Bloom that he did not know whether the fee based on reasonable rates would be higher or lower than under the original contract, but in his deposition he testified that his feeling was that the fee would probably be lower.
Frank testified at the estate hearing on fees that his office had spent 450 hours on the case and that his fee should be from $38,000 to $48,000. According to Bloom's brief, this would have amounted to $85.00 to $106.00 per hour based on 450 hours. The worksheet showed that approximately 280 hours had been spent on the case.
The additional amount demanded by Frank derived from representing Mrs. Bloom in the two state court cases, one having to do with the widow's case and the other the voting case. Both of these pertained to control of the newspaper.
Somewhat later, on March 2, 1973, Mrs. Bloom said that she learned the newspaper had been sold and that this sale had been arranged by Mr. Kitch and Mr. Brown. Mrs. Bloom finally did sell her stock, notwithstanding that Kitch was going to receive a finder's fee from the buyer of the paper based upon the number of shares that he was able to sell. Mr. Delano filed a lawsuit seeking to enjoin the sale of the newspaper and Frank represented Mrs. Bloom in that case and filed a cross claim against Kitch to recover Mrs. Bloom's portion of the finder's fee.
After the Supreme Court of Kansas ruled that the estate was not responsible for the fee here in question, Frank billed Mrs. Bloom for the sum of $107,500 for the representation in the several cases. However that was not itemized or broken down according to the various cases in which he had participated. This present suit was filed September 26, 1974. Originally Frank employed the Kitch firm to bring the fee action against Mrs. Bloom. Mrs. Bloom took exception to Frank hiring the Kitch law firm to bring the action against her because she had been adversary to Kitch in the other litigation. She sought to have the Kitch firm disqualified from trying the present case, i. e. for the attorney's fees. Later the Kitch firm voluntarily withdrew.
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