George E. Antrim, Iii, PLLC v. Sabri
| Decision Date | 29 September 2014 |
| Docket Number | A13-2174 |
| Court | Minnesota Court of Appeals |
| Parties | George E. Antrim, III, PLLC, Appellant, v. Samar Sabri a/k/a Samar M. Tomala a/k/a Samar Meri Tomala a/k/a Samar Meri Toumalah, et al., Respondents. |
This opinion will be unpublished and may not be cited except as provided by Minn. Stat. § 480A.08, subd. 3 (2012).
Affirmed in part, reversed in part, and remanded
Hennepin County District Court
George E. Antrim, III, George E. Antrim, III, PLLC, Minneapolis, Minnesota; and
John H. Daniels, Jr., Willeke & Daniels, Minneapolis, Minnesota (for appellant)
Jordan S. Kushner, Law Office of Jordan S. Kushner, Minneapolis, Minnesota (for respondents)
Considered and decided by Worke, Presiding Judge; Schellhas, Judge; and Harten, Judge.*
UNPUBLISHED OPINION
In this dispute about nonpayment of attorney fees and disbursements, appellant argues that the district court erred by denying its breach-of-contract claim, statutory attorney lien, and fraudulent-transfer claim. We affirm the district court's award of appellant's unreimbursed disbursements in the amount of $40,390.38. We reverse the court's denial of appellant's breach-of-contract claim, statutory attorney lien, and fraudulent-transfer claim and remand for proceedings consistent with this opinion.
Excelsior Development, LLC, owned a Minneapolis retail center, and its members were respondent Samar Sabri (38%), respondent Azzmi Sabri (31%), and John Bergin (31%). This case arose as a result of unpaid attorney fees of more than $350,000 and unreimbursed disbursements of more than $41,000 billed by appellant George E. Antrim, III, PLLC, in the course of its representation of Azzam Sabri and Samar Sabri (Sabris), husband and wife, in a lawsuit regarding Samar Sabri's interest in Excelsior (the Excelsior lawsuit). Samar Sabri acquired her membership units in Excelsior by transfer from Azzam Sabri, who is now deceased.1 Azzmi Sabri is the brother of Azzam Sabri.
Azzam Sabri sought Antrim's legal representation because he believed that Azzmi Sabri and Bergin had been freezing him out of Excelsior. Although Azzam Sabri no longer owned any membership units in Excelsior, he made all of the business decisionsregarding Samar Sabri's interest in Excelsior. Samar Sabri never played an active role in the management of Excelsior and trusted her husband to make all the decisions about the Excelsior lawsuit. Azzam Sabri agreed to pay Antrim and gave Antrim a $40,000 retainer, but Sabris did not sign Antrim's proposed retainer agreement. Despite not having a signed retainer agreement, Antrim commenced the Excelsior lawsuit on Sabris' behalf in June 2008 because Sabris' claims were nearing expiration under the applicable statutes of limitations. Sabris were plaintiffs, and the defendants included Excelsior, Azzmi Sabri, and Bergin. Sabris' claims included derivative claims, breach of contract, breach of fiduciary duty, unjust enrichment/restitution, intentional misrepresentation, negligent misrepresentation, and aiding and abetting conspiracy.
During the pendency of the Excelsior lawsuit, Antrim provided Azzam Sabri with bills for attorney fees and costs, reflecting its hourly attorney rate of $275, which increased to $300 in January 2009. From time to time, Antrim attempted to secure Sabris' signatures on an attorney-fee agreement, even offering to convert the representation to a contingency-fee arrangement, but Sabris never signed an agreement.
In August 2009, intending to pursue settlement of the Excelsior lawsuit, Antrim and Azzam Sabri obtained an appraisal of Excelsior's retail center. It appraised at $5,400,000, and Sabris offered to settle their lawsuit by selling Samar Sabri's membership units in Excelsior to the Excelsior defendants for $1,500,000. The Excelsior defendants counter-offered for $1,000,000, but the parties did not reach an agreement. In August 2010, the district court dismissed some of Sabris' claims on summary judgment.
In November 2010, Antrim again unsuccessfully pursued settlement through a buyout of Samar Sabri's membership units. In May 2011, the district court orally dismissed Sabris' remaining claims. Azzam Sabri had been ill for some time and, in June, his condition became more serious. In July, the court formally dismissed Sabris' remaining claims. On August 3, Azzam Sabri, who was gravely ill, instructed Antrim to appeal, but Samar Sabri indicated that Antrim should call Basim Sabri, Azzam's brother. Antrim repeatedly attempted to contact both Basim Sabri and Samar Sabri without success. On August 11, with the assistance of other legal counsel and without notice to Antrim, Samar Sabri signed an agreement for the sale of her Excelsior membership units to Azzmi Sabri for $1,300,000 in cash plus unrelated real estate, mutual release of claims, and dismissal with prejudice of the Excelsior lawsuit. On August 21, Azzam Sabri died.
On August 26, 2011, unaware that Samar Sabri had agreed to dismiss the Excelsior lawsuit, Antrim appealed the district court's dismissal and executed a notarized attorney-lien notice regarding Samar Sabri's Excelsior membership units. On October 11, Antrim received a copy of Samar Sabri's affidavit, which she filed with this court, and in which she stated that Antrim appealed without her consent or direction and that Azzam Sabri told her shortly before his death that he did not want the litigation to continue. On October 27, Antrim noticed dismissal of the appeal, explaining that Samar Sabri failed to respond to his calls, letters, and other efforts to contact her. This court dismissed the appeal on November 1. Sabri v. Bergin, et al., Sabri, et al., No. A11-1535 (Minn. App. Nov. 1, 2011) (order).
Sabris paid only $45,000 on Antrim's bills for attorney fees and disbursements—the $40,000 retainer and a $5,000 payment for disbursements. Antrim sued Samar Sabri for breach of contract, account stated, and unjust enrichment, sued Samar Sabri and Azzmi Sabri for fraudulent transfer, and sought to foreclosure its attorney lien. After a bench trial, the court awarded Antrim $40,390.38 for unreimbursed disbursements and otherwise denied Antrim's claims and requests. The court denied Antrim's new-trial motion and, except for minor corrections, denied its amended-findings motion.
This appeal follows.
After a bench trial, appellate courts review factual findings for clear error and equitable determinations for abuse of discretion, see City of N. Oaks v. Sarpal, 797 N.W.2d 18, 23-24 (Minn. 2011), giving "'due regard . . . to the opportunity of the trial court to judge the credibility of the witnesses,'" Runia v. Marguth Agency, Inc., 437 N.W.2d 45, 48 (Minn. 1989) (quoting Minn. R. Civ. P. 52.01). Factual findings are not clearly erroneous unless, when the evidence is "view[ed] . . . in the light most favorable to the verdict," they are unsupported by "reasonable evidence" and "le[ave an appellate court] with the definite and firm conviction that a mistake has been made." Rasmussen v. Two Harbors Fish Co., 832 N.W.2d 790, 797 (Minn. 2013) (quotations omitted).
Noting that "Antrim laid painstaking foundation for the bills and for the amount billed," the district court found that Antrim's total attorney fees and disbursements were $359,360.88 in excess of the $40,000 paid as a retainer and the $5,000 later paid towarddisbursements.2 And, significantly, the court also found that "[t]he expenses and fees incurred and paid were reasonable given the nature and scope of the case" and that "[t]he evidence presented at . . . trial explained the necessity of the expenses incurred and disbursements made." But the court awarded Antrim no attorney fees and only $40,390.38 in claimed disbursements, basing that award on Antrim's "implied contract of representation" with Samar Sabri. The court's award left Antrim uncompensated for $312,895.50 in attorney fees and disbursements billed in connection with the three-year Excelsior lawsuit.
Antrim argues that the district court erred by rejecting its breach-of-contract, account-stated, and unjust-enrichment claims. We agree.
"[W]hen a fee agreement is fairly entered into with the client and involves no fraud by the attorney, it is as valid and binding as other contracts not involving a fiduciary." Kittler & Hedelson v. Sheehan Props., Inc., 295 Minn. 232, 235, 203 N.W.2d 835, 838 (1973). "The essentials of such contracts, whether oral or written, express or implied, are the same as any other contracts." Id. "The elements of a breach of contract claim are (1) formation of a contract, (2) performance by plaintiff of any conditions precedent to his right to demand performance by the defendant, and (3) breach of thecontract by defendant." Lyon Fin. Servs., Inc. v. Ill. Paper & Copier Co., 848 N.W.2d 539, 543 (Minn. 2014) (quotation omitted).
The district court found that no provision of Samar Sabri's implied contract with Antrim made her liable to pay Antrim's legal fees. Antrim argues that the evidence clearly shows the existence of an effective agreement with Samar Sabri from the beginning of Antrim's representation of Sabris that required the payment of Antrim's hourly rate in return for Antrim's legal representation in the Excelsior lawsuit. Antrim's argument is persuasive.
"A contract implied in fact is in all respects a true contract" and "requires a meeting of the minds the same as an express contract." Roberge v. Cambridge Coop. Creamery, 248 Minn. 184, 188, 79 N.W.2d 142, 145-46 (1956); see also McIntosh Cnty. Bank v. Dorsey & Whitney, LLP, 745 N.W.2d 538, 549 (Minn. 2008) . "[T]he law may imply a contract from the circumstances or acts of the parties" when the parties "manifest[] . . . mutual assent." Bergstedt,...
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