Weiss v. Marcus

• Citation: 51 Cal.App.3d 590,124 Cal.Rptr. 297
• Court: California Court of Appeals
• Decision Date: 23 September 1975
• Parties: Marvin H. WEISS, Plaintiff and Appellant, v. Bradley D. MARCUS et al., Defendants and Respondents. Civ. 45777.

Page 297

124 Cal.Rptr. 297

51 Cal.App.3d 590

Marvin H. WEISS, Plaintiff and Appellant, v. Bradley D. MARCUS et al., Defendants and Respondents.

Civ. 45777.

Court of Appeal, Second District, Division 4, California.

Sept. 23, 1975.

Marcus, Wechsler & Weiss and Alvin Wechsler, Beverly Hills, for plaintiff and appellant

Levinson, Marcus & Bratter, Beverly Hills, Jonathan A. Brod and Parker S. Kennedy, Beverly Hills, for defendants and respondents.

DUNN, Associate Justice.

In this action to recover the reasonable value of legal services, plaintiff appeals from an order (judgment, Code Civ.Proc. § 581d) dismissing the action as to defendants Levinson, Marcus & Bratter and Bradley D. Marcus after the trial court sustained defendants' demurrer to plaintiff's first amended complaint without leave to amend. ¹

In addition to the dismissed defendants, ² the first amended complaint named as defendants: Edward Oran, Firemans Fund American Insurance Co. (hereinafter 'Firemans') and Continental Insurance Co. (hereinafter 'Continental'). The first amended complaint contained eight counts, each of which incorporated the allegations of all preceding counts.

The first count of the amended complaint alleged against defendant Oran: on February 1, 1970, Oran, by oral agreement, employed plaintiff to act as his attorney in prosecuting Oran's claim against one Robert Novick on account of 'injuries and/or damages'; by the terms of the oral agreement, Oran agreed to pay plaintiff, as fees for legal services to be rendered, '30 percent of all amounts recovered before the cause of action was given a pretrial date, and 37 1/2 percent of all amounts recovered thereafter, by compromise or judgment'; by written agreement dated February 1, 1970, Oran granted plaintiff a lien on all amounts recovered, ³ as security for payment of the fees due plaintiff under the oral agreement; in pursuance of his employment by Oran, plaintiff commenced an action in the Los Angeles County superior court on behalf of Oran against Novick; plaintiff diligently prosecuted such action until July 16, 1972, when he was discharged The second count entitled (money had and received), against Oran and Bradley D. Marcus, alleged: on December 13, 1972, Levinson, Marcus & Bratter and Bradley D. Marcus became Oran's attorneys of record in his action against Novick; on November 26, 1973, a settlement was negotiated in said action by which the sum of $35,000 was to be paid to Oran; on the same date, plaintiff filed a 'Notice of Motion to Establish Priority of Lien' in Oran v. Novick, setting forth plaintiff's claim in the sum of $6,750 for legal services rendered to Oran; plaintiff served copies of the notice on Marcus and on the agents for defendants Firemans and Continental; on November 28, 1973, Firemans and Continental disbursed the settlement of $35,000, in the form of drafts, to Oran and Marcus; ⁴ the drafts were paid on December 4, 1973, and the sum of $35,000 thereafter was paid to Oran and Marcus, among others; no part of said sum was paid to plaintiff; Oran, Marcus and Levinson, Marcus & Bratter became indebted to plaintiff in the sum of $6,750 for money had and received by said defendants, and each of them, for the use and benefit of plaintiff; no part of said sum has been paid.

by Oran without cause; during the course of his employment by Oran, and at his special instance and request, plaintiff performed work, labor and services of the reasonable value of $6,750; on November 28, 1973, Oran recovered $35,000 by way of settlement of his action against Novick; plaintiff thereupon became entitled to his reasonable attorney's fee of $6,750, but Oran has refused to pay such sum, or any part thereof.

The third count (conversion), against Oran and Levinson, Marcus & Bratter and Bradley D. Marcus, alleged: upon receipt of the sum of $35,000 these defendants, and each of them, were aware that $6,750 of said sum belonged to and was the property of plaintiff by virtue of his lien for attorney's fees which attached to the proceeds of the settlement in Oran v. Novick; despite such knowledge, on December 4, 1973, defendants converted the sum of $6,750 to their own use, to plaintiff's damage in the amount of $6,750; in converting said sum, defendants acted willfully and maliciously, entitling plaintiff to punitive damages of $15,000.

The fourth count (unjust enrichment), against Levinson, Marcus & Bratter and Bradley D. Marcus, alleged: from the date of their substitution as Oran's attorneys in Oran v. Novick, these defendants were fully aware of the work and effort expended by plaintiff on said lawsuit while he was Oran's attorney; in effecting a settlement of the lawsuit and in collecting the fees which they were paid as Oran's attorneys, said defendants 'exploited the work product of' plaintiff, and thereby were unjustly enriched in the sum of $6,750.

The fifth count (breach of trust), against Oran and Levinson, Marcus & Bratter and Bradley D. Marcus, alleged: upon receipt of the proceeds of the settlement in Oran v. Novick, defendants held such proceeds as trustees for the benefit of those persons entitled thereto; among said beneficiaries was plaintiff, to the extent of the legal fee of $6,750 to which he was entitled; in breach of their duties as trustees, defendants on December 4, 1973, disbursed the sum of $6,750 (which they held as trustees for the benefit of plaintiff) to others, including themselves, all to plaintiff's damage in the sum of $6,750, together with punitive damages of $15,000 for acting maliciously, etc.

The sixth count (interference with contractual relationship), against Levinson, Marcus & Bratter and Bradley D. Marcus, alleged: the lien contract between plaintiff and Oran was a valid and existing contract The seventh count (disregard of known lien rights), against Levinson, Marcus & Bratter, Bradley D. Marcus and Firemans and Continental, alleged: from December 13, 1972, to December 4, 1973, each of said defendants had knowledge of plaintiff's lien rights against any sums recovered in Oran v. Novick by way of judgment or settlement; in total disregard of plaintiff's lien rights, defendants disbursed to Oran the proceeds of the settlement in said lawsuit, to plaintiff's damage in the sum of $6,750; in doing the things alleged, defendants acted willfully and maliciously, entitling plaintiff to punitive damages of $15,000.

on November 26, November 28 and December 4, 1973; said defendants had knowledge of the lien contract; defendants, intending to induce breach of that contract, advised Oran that neither he nor they were obliged to withhold, from the proceeds of the settlement in Oran v. Novick, any sums which were due plaintiff; in breach of his lien contract with plaintiff, Oran refused to pay plaintiff the sum due him for legal services rendered; such breach of contract was caused by defendants' unjustified and wrongful conduct, and by reason thereof, plaintiff was damaged in the sum of $6,750.

The eighth count (breach of duty to give plaintiff reasonable time to protect his lien), against Levinson, Marcus & Bratter, Bradley D. Marcus and Firemans and Continental, alleged: at all times, said defendants had the duty to give plaintiff a reasonable opportunity to protect his lien; in breach of said duty, defendants willfully and wrongfully disbursed the proceeds of the settlement in Oran v. Novick without giving plaintiff such an opportunity, to plaintiff's damage in the sum of $6,750; in doing the things alleged, defendants acted willfully and maliciously, entitling plaintiff to punitive damages of $15,000.

Defendants Levinson, Marcus & Bratter and Bradley D. Marcus demurred generally to counts two through eight of the first amended complaint. The trial court sustained the demurrer to each count without leave to amend 'per defendants' points and authorities.' (Code Civ.Proc. § 472d.) Accordingly, an order was entered dismissing plaintiff's action as to defendants Levinson, Marcus & Bratter and Bradley D. Marcus. ⁵ (Code Civ.Proc. § 581, subd. 3.)

Plaintiff concedes that, as to counts two, three, five, seven and eight, no cause of action is stated unless a lien exists for recovery of the reasonable value of plaintiff's legal services. Thus, it is necessary initially to determine (1) whether a lien was created when plaintiff was employed as Oran's attorney, and, if so, (2) whether the lien survived plaintiff's discharge by Oran.

An attorney's lien against the prospective recovery of a client upon his claim, to secure the payment of a contingent fee for services to be rendered in connection therewith, may be created by contract. (Isrin v. Superior Court, 63 Cal.2d 153, 157, 45 Cal.Rptr. 320, 403 P.2d 728 (1965); Haupt v. Charlie's Kosher Market, 17 Cal.2d 843, 845, 112 P.2d 627 (1941); Gostin v. State Farm Ins. Co., 224 Cal.App.2d 319, 323, 36 Cal.Rptr. 596 (1964); Wagner v. Sariotti, 56 Cal.App.2d 693, 697, 133 P.2d 430 (1943); Tracy v. Ringole, 87 Cal.App. 549, 551, 262 P. 73 (1927).) The first amended complaint alleged execution of a written agreement granting plaintiff a lien on all sums recovered by Oran in his action against Novick, ⁶ 'as security for the payment of the fees due plaintiff.' It was further alleged that, in employing plaintiff as his attorney, Oran orally agreed to pay plaintiff a fee of 37 1/2 percent of all amounts recovered by judgment or compromise In Fracasse v. Brent, 6 Cal.3d 784, 786, 792, 100 Cal.Rptr. 385, 494 P.2d 9 (1972), the Supreme Court held that where an attorney has been discharged (with or without cause) by a client with whom the attorney had a contingent fee agreement, upon occurrence of the contingency specified in the agreement, the attorney is limited to a Quantum meruit recovery for the reasonable value of his services rendered to the time of discharge. Defendants contend that, under this rule, the contract of employment between attorney and client (including a lien agreement) is...