Category Archives: Attorney-Client

Hess v. Loyd – Rule 137 Sanctions Appropriate Against Attorney’s Attempt To Assert Lien On Case From His Former Firm

Hess v. Loyd, 5-09-0059 (Spomer)

Facts:  An attorney was assigned to work on a medical malpractice file from his firm and after being terminated by the firm attempted to assert a lien on the medical malpractice file.  The contract with the medical malpractice client was with the law firm and the attorneys employment contract with the firm specifically stated that clients were those of the firm and not the attorney.  The medical malpractice client moved to strike the lien asserted by the former associate which ultimately was appealed and led to 137 sanctions entered against the former associate.

Holding:  Rule 137 sanctions were appropriate because the former associates pleading against the client was made for improper purpose (apparently as leverage against his former law firm in a compensation dispute) and was not warranted under the law.  Also, a hearing was not required under these circumstances because the unreasonable nature of the pleading was determined on an objective standard and the un-rebutted affidavits of the attorney seeking sanctions was sufficient to determine the award.

Filed in Trial Book Under: SCR 137; Contingency Fee Contract

Commentary:  It’s not clear to me what the attorney was trying to accomplish by involving his former client, albeit through his employment with the former firm, in the case.  It seems like we are not getting the whole story in the factual recitation.  This guy probably feels that he originated the business and was upset with his old firm for not sharing in the fee.  This isn’t reflected in the opinion, so it’s only speculation on my part.  The former associate really gets beaten up by the appellate court for his actions.

The take away for me is the basic principle that a contingency fee contract must be in writing and can’t be implied, so the fact that the contract is with the law firm, and not the associate, will prevail.  Attorneys that work at forms need to either include themselves on the contract or get a written agreement with their employer on how the fee is going to be shared.  Also, if you are opposing a fee petition it’s necessary to get some conflicting evidence regarding the amount being sought.  Hopefully, this won’t ever come up, but it’s good to keep it in mind.

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Filed under Attorney-Client, Civil Procedure, Liens