Ginberg v. Tauber

• Decision Date: 25 April 1996
• Docket Number: No. 93-CV-1099.,93-CV-1099.
• Citation: 678 A.2d 543
• Parties: Louis GINBERG, Appellant, v. Laszlo N. TAUBER, Appellee.
• Court: D.C. Court of Appeals

678 A.2d 543

Louis GINBERG, Appellant, v. Laszlo N. TAUBER, Appellee.

No. 93-CV-1099.

District of Columbia Court of Appeals.

Argued January 5, 1995.

Decided April 25, 1996.

Jacob A. Stein, Washington, DC, with whom Barry Coburn was on the brief, for appellant.

William Daniel Sullivan, Washington, DC, with whom Michael R. Goodstein and Neal Goldfarb were on the brief, for appellee.

Before WAGNER, Chief Judge, and FARRELL and KING, Associate Judges.

KING, Associate Judge:

This action arises out of a dispute over attorneys' fees between Louis Ginberg, an attorney, and his former client, Laszlo N. Tauber. Ginberg filed an action against Tauber seeking, on a quantum meruit theory, the reasonable value of the services he provided in representing Tauber in a commercial landlord and tenant dispute against the District of Columbia. Although there was no fee agreement between the parties, Ginberg maintained he was entitled to recover the sum of $3,750,000 in attorneys' fees. The claimed fee amounted to one-third of the judgment, plus accruals, recovered from the District. Disclaiming the existence of a contingency fee arrangement or any other formal contract, Ginberg argued that, based on the parties' prior course of dealing, and an oral agreement allegedly entered into at the end of the representation, there was an "understanding" between himself and his client that his fee would be result-based. Ginberg moved for summary judgment on the issue of liability, which the court granted, and demanded a jury trial on the issue of the amount of the fee. The trial court, in a December 10, 1991 order, sua sponte, struck Ginberg's demand for a jury trial, stating:

unless a motion for reconsideration supported by authority to the contrary is filed by . . . Ginberg no later than January 10, 1992, . . . Ginberg's demand for a jury trial shall be struck from the record on the authority of Kudon v. f.m.e. Corp., 547 A.2d 976, 980 (D.C.1988). In Kudon, the Court of Appeals held that "where a claim for attorneys' fees arises from a private contract provision, such a claim does not embody a right to a trial by jury under the Seventh Amendment." Id.

Ginberg filed no motion for reconsideration, but on January 13, 1992, he petitioned this court for a writ of mandamus seeking an order to the trial judge to reinstate the jury demand. We summarily dismissed the petition on March 26, 1992. On June 8, 1993, after the case was routinely reassigned to another trial judge, Ginberg's counsel moved for reconsideration of the pretrial ruling regarding his demand for a jury trial. The new judge, concluding that this court's summary denial of Ginberg's petition for a writ of mandamus should be regarded as the law of the case, denied the motion for reconsideration.

The trial court then conducted an evidentiary hearing to determine the amount of the fee, at which both parties presented fact and expert witnesses. The trial court, using the lodestar¹ method, awarded Ginberg fees in the amount of $389,788.75, computed at a rate of $325 per hour. In this appeal from that judgment, Ginberg contends that: (1) he was entitled to a jury trial to determine the amount of the fee owed him; and (2) the trial court erred in selecting the lodestar method to determine a reasonable fee for his service.² We affirm.

I. Facts

Tauber owned the Presidential Building in downtown Washington D.C., which he leased to the District of Columbia (the "District") government. In October 1978, the District notified Tauber that it intended to terminate the lease and vacate the building on December 31, 1981. On December 3, 1979, however, the District attempted to rescind its termination notice. Ginberg began his representation of Tauber shortly thereafter, advising Tauber that the District was not entitled to withdraw the notice of intent to terminate the tenancy. On January 2, 1982, more than two years after the District's notice of intent to rescind the termination notice, Ginberg filed two actions on Tauber's behalf, one for possession of the Presidential Building, and one for a declaratory judgment that the District was obligated to pay a market rental, rather than the rent provided for in the lease, for as long as the District remained in possession of the property. During that two year period, Ginberg prepared the law suits, however, he never communicated with Tauber concerning the basis for the fee he intended to charge for the representation.

Tauber testified that he "very much" wanted to settle the case with the District, and he made several attempts to persuade Ginberg to seek a settlement. According to Tauber, however, Ginberg declined to initiate settlement discussions. In early 1983, the case went to trial and the District prevailed. Ginberg agreed to handle the appeal, and on April 26, 1984, wrote to Tauber about his fees for handling the appeal:

In my discussion with you in January 1984, I informed you that in connection with the handling of the appeal I want a $5,000 payment on a fee at this time, and a like amount on account of a fee in January 1985. Actually, any further fee arrangement or discussion should await the outcome of the appeal, or to see what may eventuate. I believe this would be the only fair way to have a fee determination.

Ginberg testified that he intended the "further fee arrangement" language to take care of fees other than the appeal, but that he never communicated that understanding to Tauber. Ginberg received the requested $10,000, wrote the brief, argued the appeal, and prevailed in part, in that this court remanded the case to the trial court for a new trial. Ginberg represented Tauber in the trial following remand, and a subsequent appeal by the District and cross-appeal by Tauber, from a $6.6 million verdict in Tauber's favor. By early 1991, the judgment and post-judgment accruals of rent, damages, and interest totaled $11,250,000. During this time, Ginberg refused to initiate settlement discussions with the District, despite Tauber's urging, and threatened to withdraw from representing Tauber if Tauber tried to initiate a settlement himself or through anyone else. Nonetheless, Tauber settled the case for $9 million in amortized payments over the balance of the lease, with eight and three-quarters percent interest per annum.

Ginberg also testified that the parties' first fee discussion for the entire representation occurred outside the Corporation Counsel office following the settlement conference. According to Ginberg, he informed Tauber that he believed he was entitled to a fee of thirty percent of the settlement amount, to which Tauber responded "fine." Tauber remembered the conversation differently. He testified:

Ginberg said to me that he discussed with certain colleagues of his and they suggested a 40 percent of the savings on the award, and I was in shock. I looked at him and just couldn't answer to him. And he repeat it again that I am asking only one-third. And he — I was still in shock, because nothing in the world that I expected this one. And I told him don't explain to me the contingency fee, I am a practicing physician and I know what malpractice cases is and the lawyers are charging one-third of the claim. But this wasn't a malpractice case, but Mr. Ginberg, I am not discussing fees in the lobby. sic

Following that conversation, Ginberg sent Tauber a bill for $3,750,000, exactly one-third of the amount of the judgment plus accruals. The requested fee was approximately forty percent of the settlement amount. This triggered a contentious correspondence between the parties, leading to the present action.

In the ten years that Ginberg represented Tauber in the District/Tauber rental dispute, Ginberg kept no record of the time he expended on Tauber's behalf, and did not communicate with Tauber about his fees, except the $10,000 for the appeal. Ginberg testified that he was unaware of his professional responsibility to make the terms of his fee clear to the client at the beginning of the representation. He further testified that his fee was based on the benefits to, or the amount Tauber realized from the litigation, the problems he encountered during the trial, and the ten-year duration of the representation.

Ginberg testified that he was entitled to charge Tauber a fee regardless of the outcome of the litigation, and represented that the post-settlement fee conversation between himself and Tauber was not an agreed basis for his recovery. Specifically, Ginberg made clear in the trial court that he was not contending that Tauber had agreed to pay a percentage of recovery as Ginberg's fee during that conversation. Ginberg maintains, instead, that he was entitled to a quantum meruit recovery for the "reasonable value" of his services, and the result-based bill submitted in support of this claim is consistent with the method used in his prior representations of Tauber from 1971 through 1979.

With respect to those prior representations, the evidence showed that Ginberg billed Tauber in five other real estate transactions involving the purchase of "multi-million dollar" real properties for which Ginberg billed between $1,000 to $23,000 in fees. Ginberg testified that during these transactions, he never disclosed to Tauber the basis of the fees he billed, and Tauber paid because Tauber trusted him to send an accurate bill. Ginberg represented Tauber in two other cases on a contingency fee basis: (1) an action against Traveler's Insurance Company, for which he billed Westwood Management Company, the corporation employed by Tauber to manage his real estate holdings; and (2) a claim against an architect. However, Ginberg could not recall the fee arrangement in the architect matter. Finally, after he began the representation of Tauber in this action, Ginberg submitted two bills to Tauber in connection with another case, the "Savoy litigation"; $15,000 in the middle of the litigation and $45,000 at the end. The Savoy...