Moore v. Fellner

• Decision Date: 20 May 1958
• Citation: 50 Cal.2d 330,325 P.2d 857
• Court: California Supreme Court
• Parties: Prentiss MOORE, Plaintiff, Cross-Defendant, Respondent and Cross-Appellant, v. Leopold FELLNER and Clara M. Fellner, Defendants, Cross-Complainants, Appellants and Cross-Respondents. L. A. 24895.

Page 857

325 P.2d 857

50 Cal.2d 330

Prentiss MOORE, Plaintiff, Cross-Defendant, Respondent and Cross-Appellant, v. Leopold FELLNER and Clara M. Fellner, Defendants, Cross-Complainants, Appellants and Cross-Respondents.

L. A. 24895.

Supreme Court of California, In Bank.

May 20, 1958.

Rehearing Denied June 17, 1958.

George Bouchard, Los Angeles, for plaintiff and appellant.

Sidney Dorfman, Beverly Hills, for defendants and appellants.

SCHAUER, Justice.

From a judgment for $12,825 in plaintiff's favor in his action to recover the reasonable value of services rendered by him as an attorney, both plaintiff and defendants appeal. Plaintiff contends that the award is inadequate, and defendants, claiming breach of contract by plaintiff, ¹ urge that judgment should have been in their favor. We have concluded that plaintiff has established a prevailing right, and that the judgment should be reversed and the value of the services redetermined.

The contract between the parties is evidenced by writings in the form of letters. These, and other writings between the parties, appear in the margin. The first is dated May 29, 1951, and constitutes the contract by which defendants (hereinafter sometimes referred to as Fellner) employed plaintiff to represent them as attorney in certain litigation. ² By this contract Moore was employed on a contingent fee basis to prosecute an action by Fellner against one Steinbaum for damages arising from breach of contract, and for the same contingent fee to also defend Fellner in an action brought against him by one Berzon for a broker's commission arising out of the same transaction. Moore's compensation for the dual services was to be 20 per cent of any amount recovered from Steinbaum in a settlement before trial and 25 per cent in case of trial. He was paid $500 on account of costs and an additional $500 'as an advance payment which will be a retainer.' The two actions were consolidated for trial and resulted in (1) a judgment of $104,500 in favor of Fellner and against Steinbaum, and (2) a judgment of $20,000 against Fellner and in favor of Berzon, which was settled for $17,500.

Steinbaum filed notice of appeal. Moore testified that thereafter his office 'went right on handling the case on appeal' as various matters arose needing attention, including arranging for a clerk's and a reporter's transcript, 'authorization for all exhibits to be sent up to the District Court of Appeal and any and all other preparations which were incidental to and short of the writing of the brief and the details going to that point,' as well as entering into a stipulation under which $110,000 in U. S. Treasury Certificates were deposited by Steinbaum in lieu of an undertaking on appeal.

On March 2, 1954, before appellant Steinbaum's brief had been received, and when the services called for by the conract, insofar as they had then accrued, had been faithfully performed, Moore wrote to Mr. and Mrs. Fellner stating that if they wished him to handle the appeal his fee would be $2,000 plus the necessary costs. ³ On March 3, 1954, Mr. Fellner replied, ⁴ referring to the provision of the employment contract2 reading as follows: 'It is understood that this agreement covers our understanding to the conclusion of these two cases in the Superior Court and, at our option, in any of the higher courts.' Moore replied on March 10, ⁵ and on March 13 Fellner wrote Moore ⁶ again calling attention to the above-quoted contract provision and declaring, among other things, that 'We must consider that you have deliberately breached our agreement of May 29th, 1951. For that reason 1) we consider your relationship as our attorney terminated * * * and will seek other counsel to represent us in this litigation.' Moore replied on March 19. ⁷ Moore declined to sign a substitution of attorneys and Fellner obtained an order in the District Court of Appeal substituting other counsel on the appeal. Thereafter on June 30, 1954, Moore again wrote to Fellner. ⁸ The judgment against Steinbaum was affirmed on appeal (Fellner v. Steinbaum (1955), 132 Cal.App.2d 509, 282 P.2d 584), and Fellner was paid some $117,000 (which included interest) thereunder. The substituted counsel charged Fellner $1,000 for handling the appeal.

From the writings above listed and other evidence the trial court found, so far as here material, as follows: plaintiff Moore demanded from Fellner $2,000 as additional compensation for handling the appeal and refused, after demand by Fellner, to handle the appeal unless he was paid the $2,000; he was discharged by Fellner, and 'it is not true that the defendants discharged plaintiff without cause or justification'; on June 30, 1954, 'plaintiff in writing rescinded' his contract with defendants; 'at the time of his discharge plaintiff had substantially performed his part of the agreement with defendants, and the services rendered by him were of value to the defendants'; the 'reasonable value of the professional services rendered * * * by plaintiff * * * to the time he was discharged is the sum of $13,325.00' of which he had been paid on account the sum of $500. As conclusions of law the court declared that plaintiff, under the terms of his contract with Fellner, was 'required to represent' the latter on the appeal from the judgment against Steinbaum without further charge; that plaintiff's demand for an additional fee was wrongful and a breach of his contract; but that plaintiff is entitled to recover from Fellner the reasonable value of his services, less the $500 paid on account. Judgment was thereupon entered in plaintiff's favor for $12,825, and these appeals by both parties followed.

As ground for reversal, defendants contend that plaintiff was required to represent them on the Steinbaum appeal without further compensation, that he wrongfully demanded payment of an additional fee of $2,000 and refused to render further services on the appeal unless paid that sum, and that he thereby breached the employment contract and is therefore entitled to no compensation.

Plaintiff does not dispute that he was obligated to handle the appeal if Fellner so requested, and seems not now to contend that he was entitled to demand an additional fee for so doing. Plaintiff does, however, urge that he was to 'do so (only) when the client exercised his option and notified him,' and that the option was never exercised. This contention, on the record before us, is without substantial merit. Previous to his letter of March 2, 1954, to Fellner, plaintiff had already, with Fellner's consent, handled all steps proper to be performed up to that time relative to the appeal, had notified Fellner of the charges for appeal transcripts, and had been advised by Fellner that these and additional costs would be paid. He had not written the respondent's brief, but appellant's opening brief had not yet been received. It further appears from plaintiff's testimony that he had originally drafted the employment contract between the parties but that the words 'and, at our option, in any of the higher courts,' as well as the provision that Fellner was not to pay as costs the 'fees to any other attorneys you (plaintiff) may employ in these matters,' were inserted by Fellner in the contract; and, further, that 'one of the reasons for * * * (Fellner's insertions was) to make sure that if the case were lost, he would have no obligation of any kind to me or anyone employed by me for any services rendered in this matter * * * and * * * would have the right to * * * have somebody else prosecute the appeal or take whatever action they cared to after the case might be lost in the Superior Court.' It is thus inferrible that Moore did not understand the option provision to apply if, as actually occurred, the case was won in the trial court. Moreover, although Fellner testified that following the trial he did not talk to Moore 'specifically' about 'these appeal problems,' he did testify to 'two or three' personal conversations and a 'few' telephone conversations concerning their progress with Moore's office associate, Mr. Lindelof, with whom Moore had previously directed that Fellner 'always should talk.' Moore himself testified freely that 'whatever was done by my office I take the full responsibility for it and it is not that of either Mr. Lindelof or anyone else in the office other than my own and done under my authority and by my delegation.' Thus the trial court could infer that Moore was fully aware, prior to his letter of March 2, that Fellner expected and intended that Moore would handle the appeal, and that no formal notice of exercise by Fellner or his option was required.

Moore, although not contending that he was entitled to an additional fee of $2,000, urges that after all he did not demand an additional fee for the appeal or make 'the fee itself a condition precedent to the attorney going ahead with the appeal.' The language he used in the letter of March 2, was: 'We should like to have you advise as soon as possible as to whether you desire this office to handle the appeal and if so, our fee will be $2,000.00, plus the necessary costs above outlined.' In his letter of March 10 to Fellner, Moore referred again to his statement that 'should you care to have this office represent you in the appeal, * * * our fee would be $2,000.00 in addition to any costs on appeal.' It is apparent that the trial court was warranted in interpreting this language as a demand by More for payment of an additional fee and a refusal to handle the appeal unless it was paid, and in concluding that plaintiff's demand was 'wrongful and a breach of his contract.' It follows that Fellner was not bound to make further demands for performance by Moore but was justified in accepting his conduct as a termination of 'your relationship as our attorney'6 and in employing other counsel to handle the appeal.

However, it does not follow that Moore's right to compensation for...