Kramer v. Fallert

Citation628 S.W.2d 671
Decision Date15 December 1981
Docket NumberNo. 42898,42898
CourtCourt of Appeal of Missouri (US)
PartiesHarry A. KRAMER, Jr., et al., Plaintiffs-Respondents, v. Charles B. FALLERT, Catherine E. Fallert and Fallert Tool & Engineering Company, Inc., Defendants-Appellants.

Page 671

628 S.W.2d 671
Harry A. KRAMER, Jr., et al., Plaintiffs-Respondents,
v.
Charles B. FALLERT, Catherine E. Fallert and Fallert Tool &
Engineering Company, Inc., Defendants-Appellants.
No. 42898.
Missouri Court of Appeals, Eastern District, Division Two.
Dec. 15, 1981.

Page 672

Michael J. McAvoy, Fenton, Love, Lacks, McMahon & Schwartz, Clayton, for defendants-appellants.

John Quinn, Frank Gundlach, St. Louis, for plaintiffs-respondents.

PUDLOWSKI, Presiding Judge.

Suit for attorney's fees. Appellants Charles and Catherine Fallert (Fallerts) and Fallert Tool and Engineering Co., Inc. (hereinafter Fallert Tool) appeal from the granting of a motion for summary judgment. We reverse.

Respondents represented appellants, the Fallerts, in the purchase of McClain Tool Co., a small machine tool business owned by Eugene F. McClain and his wife. Fallert Tool, a Missouri corporation, was formed and acquired title to the business. Fallert Tool executed a promissory note in the amount of $41,000 to the McClains and the Fallerts personally guaranteed it. Fallert Tool defaulted on the note. In April, 1975, the Fallerts, as guarantors, received a demand for payment from the McClain's attorney. On April 28, 1975, Fallert Tool filed suit against the McClains alleging fraud and misrepresentation in connection with the sale of the tool company's assets. On June 17, the McClains filed a counterclaim against Fallert Tool and the Fallerts, as guarantors, for the balance of the purchase price. The next day, respondents wrote a letter to Charles Fallert in his capacity as president of Fallert Tool setting out the terms of employment. When the letter was drafted respondents knew full well that the Fallerts individually were joined as third-party defendants in the McClain's counterclaim. The letter stated in part:

Our fee for representing you in this matter will be as follows: A retainer fee of $1,000.00 is to be paid at this time.

In the event we are successful in obtaining a money judgment against the McClains or a reduction in the obligation to the McClains for the balance of the purchase price, we are to be paid a fee of one-third of the net amount recovered or credited either by way of trial or settlement.

Page 673

In the event the matter presently pending in the St. Louis County Circuit Court is appealed, our fee will be forty percent of the net amount recovered or credited following the appeal.

The $1,000.00 retainer fee is to be credited against any recovery. If no recovery is made, your only fee obligation will be the $1,000.00.

Respondents requested that Charles Fallert sign the letter in his capacity as president of Fallert Tool and mail it back to respondents so that the letter would constitute the contract of employment. Charles Fallert signed on behalf of Fallert Tool, indicating acceptance of those terms, and remitted a company check in the sum of $1,000.00. Neither Fallerts signed the contract in an individual capacity. On December 6, 1975, the McClains filed a second counterclaim in replevin for the return of certain equipment and property pursuant to a security agreement. There was no subsequent fee contract executed.

The matter went to trial and on January 13, 1977, the jury returned its verdict. The jury found for Fallert Tool on its claim of fraudulent misrepresentation in the amount of $63,195; and for the McClains against Fallert Tool and the Fallerts on their counterclaim in the amount of $57,195, representing principal, interest and attorney's fees. The jury also found against Fallert Tool and the Fallerts individually on the second counterclaim. This court affirmed the judgment in part, reversed the judgment against the Fallerts and Fallert Tool on the second counterclaim and reduced the $57,195 award on the McClains first counterclaim to $44,195. Fallert Tool and Engineering Co. v. McClain, 579 S.W.2d 751 (Mo.App.1979).

To satisfy the judgment the McClains paid $20,750 into the registry of the court. That sum represented the net award, interest and court costs. Fallert Tool, subsequently endorsed the court check and reluctantly released it to the respondents. Thereafter, respondents sent a fee bill to the appellants for services rendered in the amount of $8,525.50. 1 The appellants refused to remit any further sums for legal services rendered.

Respondents instituted suit against appellants individually and severally for the balance due. Subsequently, respondents filed an amended petition, alleging in Count I that the appellants, Fallert Tool and the Fallerts, agreed to pay the respondents pursuant to the terms of the contract entered into between respondents and Fallert Tool. In Count II, the respondents alleged a claim in quantum meruit against both appellants in that they rendered legal services to the defendants at their requests. As previously stated, the appellants filed their answer and admitted that Fallert Tool entered into a contract with respondents but denied all other allegations. No other responsive pleadings were filed by the appellants. The trial court rendered summary judgment on Count I in favor of respondents in the amount of $8,790.80. The court in its Findings of Fact and Conclusions of Law held that the computations made on the May 18, 1979 bill were correct and:

... (A)s a matter of law ... Charles B. Fallert and Catherine E. Fallert intended to compensate plaintiffs for the defense of the claims against them in the same manner that Fallert Tool & Engineering Co., Inc. agreed to compensate plaintiffs for the original suit; i.e., the fee contract set forth in the June 18, 1975 letter, and the Court finds that plaintiffs intended to be compensated by the Fallerts in...

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