Van Bergh v. Simons

• Citation: 286 F.2d 325
• Decision Date: 07 February 1961
• Docket Number: No. 149,Docket 26380.,149
• Parties: Maurice H. VAN BERGH, Plaintiff-Appellant, v. Gustave SIMONS, Defendant-Appellee.
• Court: United States Courts of Appeals. United States Court of Appeals (2nd Circuit)

286 F.2d 325 (1961)

Maurice H. VAN BERGH, Plaintiff-Appellant, v. Gustave SIMONS, Defendant-Appellee.

No. 149, Docket 26380.

United States Court of Appeals Second Circuit.

Argued January 3, 1961.

Decided February 7, 1961.

David Alter, New York City (Hubert Thurschwell, Squadron, Alter & Weinrib, New York City, on the brief), for plaintiff-appellant.

W. Philip Van Kirk, New York City, for defendant-appellee.

Before LUMBARD, Chief Judge, and SWAN and WATERMAN, Circuit Judges.

LUMBARD, Chief Judge.

This appeal turns on whether, under New York law, a layman can enforce an alleged agreement with a lawyer, whereby the lawyer promised to turn over 25% of all fees received from a client for the prosecution of an excess profits tax refund claim in return for the layman's efforts in procuring the client and his promise to be available if called upon to help in preparing the claim. The question was presented to the District Court for the Southern District of New York on the complaint, the answer, and the depositions of both parties, by the defendant's motion for summary judgment on the ground that the contract was illegal under governing New York law. Judge Murphy, agreeing that it was illegal and therefore unenforceable, granted summary judgment for the defendant, whereupon the plaintiff appealed.

Viewed in the light most favorable to the plaintiff, the complaint and the depositions tend to establish an oral agreement in April 1946 between Maurice H. Van Bergh, a layman, and Gustave Simons, a lawyer specializing in tax matters. The terms of the agreement were that if Van Bergh procured Textileather Corporation as a client for Simons, Van Bergh would receive from Simons 25% of all fees received by Simons from Textileather for procuring a refund of excess profit taxes.¹ Van Bergh testified:

"The first service that I was to render was the introduction of Mr. Simons as a competent attorney for the handling of tax matters. And that in itself, namely, the introduction, was all that I was specifically required to do."

In addition, it was agreed that Van Bergh, a consultant in industrial and economic matters, would be available for such services as he might render "as a consultant and as an economist." This portion of the agreement was reflected in an office memorandum prepared by Simons on November 14, 1946, which said that "Maurice Van Bergh is collaborating with us in this case, and therefore have him participate to the extent of his convenience and availability in the economic aspects of this study."

In fact, Van Bergh's work on the case was limited to his introduction of Simons to the client as he did nothing whatever thereafter although he testified that he was always "available."

In December 1946, Van Bergh billed Simons for $531.25 for "Service Rendered in Connection with Textileather Corporation to date," which sum was paid. The record before us contains no explanation of how this amount was arrived at or what the "service" consisted of. In our view of the case, the fact that Simons may have paid Van Bergh some part of a fee in 1946 has no bearing upon the merits of Simons' defense of illegality as to any moneys that are now claimed.

Simons defends on the ground that the contract, if made as Van Bergh claims, violated New York Penal Law, McKinney's Consol.Laws, c. 40, § 276 and that the agreement is therefore unenforceable.² Section 276, in its pertinent words, makes it a misdemeanor for "any person * * * to divide with * * * any attorney at law * * * any portion of any fee or compensation * * * in consideration of...