Kelly on Malpractice

In Wright v. Wright, 2007 WL 4340871 (Tenn.Ct.App.), the appeal concerned the amount of attorney’s fees awarded to counsel for a minor in a suit arising out of an accident which resulted in substantial injuries to the minor child. The only issue on appeal was the amount of attorney’s fees set by the trial court. Before the Court was a guardian ad litem’s challenge, on behalf of his minor client, to the amount of attorney’s fees awarded ($141,666 .66) after the minor’s lawsuit was settled for $425,000.00. Kaitlyn Lee Wright (“Kaitlyn”), a nine-year-old girl, was seriously injured in an automobile accident. Kaitlyn’s parents were divorced. Her father filed a complaint as her next friend in Circuit Court. Kaitlyn’s mother filed an identical action also in the Circuit Court. The trial court appointed a guardian ad litem because there were “competing parents” who fought over many issues in the case involving the child.

At a settlement conference, the defendant agreed to pay $425,000.00 to settle Kaitlyn’s claims. Since the case involved a minor, the settlement required approval by the trial court. The trial court must ensure that the settlement itself is in the best interests of the minor. See Busby v. Massey, 686 S.W.2d 60 (Tenn.1984); T.C.A. §§ 29-34-105, 34-1-121(b). Notice was sent to the parties in this case that counsel for the plaintiff would appear to obtain judicial approval of the minor’s proposed settlement, which included an attorney’s fee of $141,666.66. After notice of the requested fee, the guardian ad litem objected to the amount of the requested fee and asked for a hearing. The guardian ad litem pointed out that the attorney’s fees to be awarded could not be controlled by a contingency agreement between the father and the lawyer but rather should be governed by a “reasonableness standard.” The guardian ad litem cited the trial court to Shoughrue v. St. Mary’s Medical Center, Inc., 152 S.W.3d 577 (Tenn.Ct.App.2004), and the factors contained in Rule 1.5(a) of the Rules of Professional Conduct. It has long been the law in Tennessee that a parent cannot make a contract with counsel which would bind the minor with respect to the amount of attorney’s fees. This rule was recently reiterated in a medical malpractice action. See Shoughrue v. St. Mary’s Med. Ctr., 152 S.W.3d 577, 585 (Tenn.Ct.App.2004). The factors to be considered in setting attorney’s fees are those contained in Rule of Professional Conduct 1.5(a):

(1) The time and labor required, the novelty and difficulty of the questions involved, and the skill requisite to perform the legal service properly;
(2) The likelihood, if apparent to the client, that the acceptance of the particular employment will preclude other employment by the lawyer;
(3) The fee customarily charged in the locality for similar services;
(4) The amount involved and the results obtained;
(5) The time limitations imposed by the client or by the circumstances;
(6) The nature and length of the professional relationship with the client;
(7) The experience, reputation, and ability of the lawyer or lawyers performing the services; and
(8) Whether the fee is fixed or contingent. The contingent nature of the fee may be considered, but only as one of the eight factors listed above.

There are lessons from Wright to avoid a fee dispute. The contingency fee contract is not controlling, so keep a detailed cost summary and perhaps even time sheets when you have a minor claim. Hire an experienced guardian ad litem at the genesis of the case who you know. There are experienced personal injury lawyers who will serve as guardian ad litem on a contingency basis. They can testify at trial how the money will be distributed exclusively for the benefit of the child. This assuages concerns of doubtful jurors who worry that parents will fritter away money from the child. The imprimatur of court control of the funds essential. Finally, the guardian ad litem can testify that your hard work and care in the case justifies the fee requested. Judges always listen to guardians.

In Wright v. Wright, 2007 WL 4340871 (Tenn.Ct.App.), the appeal concerned the amount of attorney’s fees awarded to counsel for a minor in a suit arising out of an accident which resulted in substantial injuries to the minor child. The only issue on appeal was the amount of attorney’s fees set by the trial court. Before the Court was a guardian ad litem’s challenge, on behalf of his minor client, to the amount of attorney’s fees awarded ($141,666 .66) after the minor’s lawsuit was settled for $425,000.00. Kaitlyn Lee Wright (“Kaitlyn”), a nine-year-old girl, was seriously injured in an automobile accident. Kaitlyn’s parents were divorced. Her father filed a complaint as her next friend in Circuit Court. Kaitlyn’s mother filed an identical action also in the Circuit Court. During these proceedings the trial court appointed a guardian ad litem because of concern that there were “competing parents.”

The parties attended a judicial settlement conference, and the defendant agreed to pay $425,000.00 to settle Kaitlyn’s claims. Since the case involved a minor, its settlement required approval by the trial court. By caselaw and by statute the settlement of a case brought by a minor for personal injuries must be approved by the court, and the court must ensure that the settlement itself is in the best interests of the minor. See Busby v. Massey, 686 S.W.2d 60 (Tenn.1984); T.C.A. §§ 29-34-105, 34-1-121(b). Notice was sent to the parties in this case that counsel for the plaintiff would appear to obtain judicial approval of the minor’s proposed settlement, which included an attorney’s fee of $141,666.66. The guardian ad litem objected to the amount of the requested fee.

The trial court held a hearing. There was no affidavit from counsel for the plaintiff as to his time, and, even though there was much discussion of a contingent fee agreement between him and the plaintiff’s father, no written agreement was ever entered into evidence. The guardian ad litem pointed out that the attorney’s fees to be awarded could not be controlled by a contingency agreement between the father and the lawyer but rather should be governed by a “reasonableness standard.” He cited the trial court to Shoughrue v. St. Mary’s Medical Center, Inc., 152 S.W.3d 577 (Tenn.Ct.App.2004), and the factors contained in Rule 1.5(a) of the Rules of Professional Conduct. It has long been the law in Tennessee that a parent cannot make a contract with counsel which would bind the minor with respect to the amount of attorney’s fees. This rule was recently reiterated in a malpractice action. See Shoughrue v. St. Mary’s Med. Ctr., 152 S.W.3d 577, 585 (Tenn.Ct.App.2004). The factors to be considered in setting attorney’s fees are those contained in Rule of Professional Conduct 1.5(a):

(1) The time and labor required, the novelty and difficulty of the questions involved, and the skill requisite to perform the legal service properly;
(2) The likelihood, if apparent to the client, that the acceptance of the particular employment will preclude other employment by the lawyer;
(3) The fee customarily charged in the locality for similar services;
(4) The amount involved and the results obtained;
(5) The time limitations imposed by the client or by the circumstances;
(6) The nature and length of the professional relationship with the client;
(7) The experience, reputation, and ability of the lawyer or lawyers performing the services; and
(8) Whether the fee is fixed or contingent. The contingent nature of the fee may be considered, but only as one of the eight factors listed above.

The attorney seeking fees has the burden of proving what constitutes a reasonable fee. Ordinarily, the party requesting attorney’s fees carries this burden by presenting the affidavit of the lawyer who performed the work. Counsel for the plaintiff believed that the contingent fee agreement trumped all the other relevant factors set out in RPC 1.5(a). The Court of Appeals disagreed. This case means that you must keep your time sheets when a minor claim is involved.