Michael R. Caryl P.S.

Attorney’s Fees Issues – Our Sole Focus (206) 378-4125

Proven Results

Meadow Valley Owners’ Association v. Levin and Stein, King Co. #03-2-33931-8KNT; on appeal, 2010 Wash App Lexis 1537; pet. Den. 170 Wn.2d 1011 (2010). After more than a month-long trial over attorney’s fees claimed by law firm of $2.123 million, Michael and his co-counsel Lee Raaen of Seattle obtained a judgment reducing the law firm’s claimed fees from $2.123 million (as asserted in claim of attorney’s lien) to $596,350, after the trial court had forfeited $400,000 of those fees for serious breaches of fiduciary duty. The trial court then awarded MVOA fee shifting attorney’s fees of $492,074.75. The end result was that the law firm recovered only about $120,000 out of its $2.123 million attorney’s lien. MVOA avoided over $2 million in potential fees. All aspects of the judgment with the exception of the award of fee shifting fees was affirmed by the Court of Appeals. The fee shifting award was remanded to the trial court for a determination whether either party was the prevailing party for fee shifting fees. 157 Wn. App. 1003 (2010). The trial court on remand found MVOA to be the prevailing party and its award of attorney’s fees was affirmed. The case thereafter settled, and MVOA was fully paid.

VSL v. DDI (Name withheld per client request) (Superior Court of Washington) Michael sued his lawyer-client’s former lay client and ultimately recovered over $1.2 million. Michael’s lawyer-client had previously litigated a number of separate matters for his client and obtained cash and property whose value was in excess of $5 million, including cash awards of attorney’s fees. After having paid very little in fees, once he had recovered title to several parcels of real property and substantial sums in cash, VSL’s former client sought to substantially negotiate down VSL’s hourly lawyer’s fees due, even though much of these fees had already been awarded (and determined reasonable) by several courts on a fee shifting basis, and those fees had actually been paid to the client.

In the ensuing lawsuit he brought against the former client, Michael obtained a summary judgment based on the principle of judicial estoppel (i.e. the client was legally prevented from challenging the reasonableness of attorney’s fees that had been presented to the court earlier in fee shifting motions and actually awarded by the court) that his lawyer client was entitled to those fees awarded by other courts earlier. This resulted in a series of voluntary payments to Michael’s client. As the case was approaching trial, the case settled in a judicial settlement conference. The total sums paid to VSL were over $1.2 million.

Breda v. B.P.O. Elks-Lake City, King Co. Superior Ct. Lawyer MT had represented the Bredas who were plaintiffs in a tort action involving serious brain injury to Mr. Breda. The jury awarded $3.4 million to the plaintiffs but found the Bredas substantially at fault, reducing their recovery by about $1 million. After the case was affirmed on appeal, the Bredas raised serious questions about MT’s conduct of the case, challenged the reasonableness of the $1 million fee claimed by MT as his fee and questioned the nearly $300,000 in costs claimed to be reimbursable by the attorney. The attorney asserted an attorney’s lien against the Breda’s recovery and filed a motion to foreclose the attorney’s lien. On behalf of the Bredas, Michael responded by filing a petition for a determination of reasonableness under RCW 4.24.005 in regard to the fees and costs sought by MT in King County. The Bredas’s reasonableness determination was consolidated with the lien foreclosure action. In discovery, Michael determined that much of the costs claimed were either not lawfully chargeable, were exaggerated in amount, or were never even incurred; Michael further learned of grounds for bringing a separate legal malpractice claim. About six weeks before the trial date, MT settled with the Bredas for $650,000, a reduction of some $650,000 in fees and costs claimed, and the Bredas preserved their rights to pursue the lawyer for legal malpractice. See next result.

Riley v. MT, King County Superior Court. –This case is a companion to the preceding Breda v. B.P.O. Elks Lake City. Following the settlement of the fee/costs dispute with lawyer MT, Michael and his co-counsel Donovan Flora of Johnson-Flora of Seattle (as lead counsel) developed theories of legal malpractice against lawyer MT. Suit was filed, and Mr. Flora and Michael achieved an order on summary judgment for legal malpractice against attorney MT in the amount of $1,508,810, including prejudgment interest. The Bredas had lost 30% of their $3.4 million judgment when Mrs. Breda was found to be at fault by the jury. However, in an earlier proceeding, Mrs. Breda had been determined to be without fault on summary judgment. Mr. Flora and Michael contended that where attorney MT had failed to assert the collateral estoppel effect of a prior court ruling that would have eliminated any fault by Mrs. Breda, and allowed her fault to go to the jury, such failure was below the standard of care. The case later settled for well in excess of $1 million shortly before oral argument in the Court of Appeals.

EOSTC v. King County Law Firm (Name withheld due to confidentiality). Law firm attorneys settled a medical malpractice claim against hospital for 7 figures. Attorneys claimed a 7 figure attorney’s fee and about $400,000 in costs, tendering less than 26% of the recovery to client as client’s supposed share of the proceeds. Client challenged the fees and the costs, and hired Michael and his co-counsel, David C. Burkett, of Burkett and Burdette, to pursue the challenge. After several hard-fought discovery battles, Michael and David obtained irrefutable proof that the attorneys, among other things: (1) charged the client for out-of-pocket “costs” for in-house copying, scanning, and printing – the scanning had no cost at all; while copies and printing were charged at rates far in excess of actual cost; (2) charged the client for tens of thousands of copies, scans, and prints which were never actually made; (3) charged the client for about $80,000 as “costs” which were actually ordinary legal services provided by subcontract attorneys that should have been included in the contingency fee; and (4) pocketed about $46,000 in court-awarded sanctions that the defendant in the underlying case had been ordered to pay and were actually paid; and (5) withheld a 6 figure portion of the gross recovery belonging to the client to cover potential claims of medical subrogation, where the amount withheld substantially exceeded any potential claims of subrogation. The attorneys fired their first defense lawyers. The second defense lawyer promptly suggested and arranged mediation. The result of the mediation was a large 6 figure recovery for the client, which essentially gave the client everything that had been challenged. The attorneys for the law firm insisted on strict confidentiality, for obvious reasons.

Taylor v. Shigaki, 84 Wn. App. 723, 930 P.2d 340 (1997). This case is Michael’s first fee dispute. Begun in 1994, Michael represented Seattle lawyer Fred Zeder and his law firm, Peterson Young Putra, in a fee dispute with a former client, John William Taylor. A couple of weeks before the underlying personal injury trial, attorney Zeder obtained a $225,000 offer of settlement from the liability insurer. Within days, client Taylor fired Zeder and his law firm and then settled his own injury claim with the insurer for about $260,000, less than the $300,000 policy limit. Zeder retained Michael and they filed an attorney’s lien for one third of the $225,000 offer, based on the contention that Zeder had substantially performed his contingency. Client Taylor challenged Zeder’s right to the contingency fee, contending that Zeder should only be paid hourly on a quantum meruit basis. Michael developed expert testimony on substantial performance and the value of Zeder’s legal services. After a 5 day trial in which Michael offered evidence from the insurer that had Zeder not been terminated, it would have paid the full $300,000 policy limit, the trial court ruled that Zeder had substantially performed his contingency and awarded him $75,000 plus his attorney’s fees of nearly $30,000 plus prejudgment interest on the $75,000. Zeder prevailed in the Court of Appeals and defeated a petition for review in the Supreme Court. Zeder was awarded his attorney’s fees in both the Court of Appeals and in the Supreme Court. This case is the first published decision in Washington where an attorney prevailed against a client based on the doctrine of substantial performance.

Barrett v. Freise, 119 Wn. App. 823, 82 P.3d 1179 (2003) – This case is in many respects very similar to Taylor v. Shigaki. Michael’s lawyer-client Eric Freise had negotiated tort settlements totaling $600,000, which represented all of the auto liability and underinsured motorist’s insurance coverage available. At this time, Freise was pursuing a liquor liability claim against a tavern that had allegedly over-served a patron before he went out on the road and severely injured Freise’s client while driving while intoxicated. Another lawyer got involved with Freise’s client, and as a result, Freise was terminated by his client Barrett’s guardian, and when Freise refused to go away quietly, Barrett’s guardian and his new lawyer sued Freise for legal malpractice, breach of fiduciary duty, and conflict of interest. Barrett challenged the enforceability of Freise’s contingency fee agreement and his attorney’s fees were challenged in an RCW 4.24.005 petition for determination of reasonableness. Michael and his co-counsel on the malpractice/ethics claims, Teena Killian, moved for summary judgment of dismissal of the malpractice/ethics claims and for a determination that Freise has substantially performed his contingency and had earned $200,000 in fees. The trial court granted Freise’s motion to dismiss all the malpractice/ethics claims brought against him and granted Freise’s claim as a matter of law that he had substantially performed his contingency and earned the $200,000 contingency fees. Nonetheless, the trial court reserved ruling on the reasonableness of the $200,000 in fees for trial while the case against the tavern was pending. When the case ultimately came on for trial several years later, the trial court ruled that the $200,000 in fees was reasonable. The Barretts appealed the judgment in favor of Freise to the Court of Appeals, which affirmed in a published opinion.

C&H, P.S. v. Metropolitan Creditors Trust (MCT), American Arbitration Association #75-107-00414-08. MCT was a creditor’s trust that succeeded to the assets and debts of a Spokane mortgage company. The mortgage company had invested a large sum in the Foreign Leveraged Investment Program tax shelter (FLIP). The IRS determined the FLIP tax shelter to be abusive and disallowed all of the tax benefits. Michael’s client, the law firm C&H, then represented MCT on a contingency fee basis in litigation against the promoters and accounting firm which had given a positive tax opinion letter to the promoters of what later was determined by the IRS to be an abusive tax shelter. After C&H had made substantial progress towards settlement of the FLIP claim, MCT terminated C&H and thereafter settled the case, refusing to pay C&H its fees. C&H retained Michael who asserted two attorney’s liens and commenced the AAA arbitration of the case. After a six-day trial in arbitration, Michael obtained for his clients an arbitration award for C&H’s hourly attorney’s fees based on quantum meruit, a substantial six figure award of prejudgment interest and an award of prevailing party attorney’s fees, costs, and arbitration fees. The total amount of the arbitration award in favor of Michael’s client was $622,571. The award was paid.

Blakelore, LLC v. Fegert and Tim’s Tractor, San Juan Co. No. 0877-205070-2. Plaintiff Blakelore hired a Los Angeles law firm to pursue timber trespass claims against neighboring residents of Blakelore’s principal on Blakely Island in San Juan County. The case ended poorly with a $30,000 jury verdict. The law firm sought to enforce hourly billings against its client Blakelore, in the amount of approximately $400,000, including the over $233,000 already paid by its client Blakelore. Michael brought an RCW 4.24.005 “reasonableness of the fee” petition in the trial court in San Juan County. Shortly before the trial date, the case settled where no more money changed hands and the parties executed mutual releases. Blakelore avoided paying the $233,000 balance to the Los Angeles law firm.

RK, client, v. attorney CH, King Co. Superior Ct. (Name withheld at client’s request) Attorney CH represented client in dissolution of marriage, where the end result was very mediocre. RK had paid her attorney CH approximately $296,000. When attorney insisted on the unpaid balance being paid or undergo arbitration, Michael commenced suit for client RK to strike the arbitration clause in the fee agreement and for a substantial reduction in the fees charged. The trial court struck the arbitration clause and the case proceeded towards trial. At mediation, attorney CH initially claimed a balance due of $165,000. After substantial discovery and retention of expert witnesses with solid expert testimony, Michael was able to settle the attorney’s claims at the settlement mediation for no money payment to the attorney and mutual releases. The client paid nothing more.

A.L.G. &R. H. v. B.R., King County Superior Court. (Names withheld due to confidentiality) Attorney BR represented client in serious death case for over 18 months. As trial approached, he associated A.L.G. and R.H. to assist in negotiations and mediation. The two attorneys discussed but never reached agreement on how A.L.G. and R.H. would be compensated. As the trial approached, the case was settled for a substantial 7-figure sum to the estate of the client. After settlement, A.L.G. and R.H. sought to be paid half the contingency fee received by B.R. Suit was filed by A.L.G. and R.H. against B.R., the end goal of which was a division of the B.R. contingency fee where A.L.G. and R.H. would receive half the 7-figure contingency fee. Michael and his co-counsel, David C. Burkett, of Burkett and Burdette, moved for summary judgment for a determination by the court that A.L.G. and R.H. were not entitled to any part of the contingency fee because they had not complied with RPC 1.5(e) which required that any such division of the fee be approved in writing. The court granted B.R.’s motion, ruling that the compensation of A.L.G. and R.H. under principles of quantum meruit would be handled on a lodestar (effectively hourly) basis, taking into account the reasonableness factors under RPC 1.5(a). The case settled almost immediately thereafter where A.L.G. and R.H. received only a small portion of the 7-figure sum originally sought.

In re the Estate of Wm. Ross Taylor v. Patricia Caiarelli, King Co. Super. Ct. Cairelli’s counsel Kimbrough and Gauthier sued the Estate of Taylor in essence for conversion of assets belonging to Caiarelli’s minor ward (and son of Taylor) and ultimately obtained a judgment in excess of $1,422,000. Caiarelli sought an award of fee shifting attorney’s fees and costs. Kimbrough and Gauthier retained Michael to develop and present a motion for award of fee shifting fees. Michael obtained expert witnesses to support the claim for fees, drafted his motion and the evidence supporting it and argued the case to the court. The court ultimately awarded Michael’s client nearly $424,000 in discretionary attorney’s fees, expert witness costs and other costs.

Kimbrough v. Foulon, King Co. No. 04-2-06009-5SEA, aff’d 2008 Wash. App. LEXIS 1451 (Wash. Ct. App., June 16, 2008) pet den. Kimbrough V., 2009 Wash. LEXIS 461 (Wash., Apr. 29, 2009) – Lawyer Kimbrough was retained by clients Foulon in an acrimonious boundary dispute with a next door neighbor in a wealthy enclave along Lake Washington. Kimbrough was required not only to handle the boundary litigation but negotiate at length with the homeowners association of this enclave. Following the intake at which Kimbrough discussed fee arrangements and sent the client Foulons home with a written fee agreement, Kimbrough began substantial work, taking over discovery from a prior lawyer. He engaged in substantial motions practice and prepared the case for trial. All the while, the clients failed to return the signed fee agreement and paid little of Kimbrough’s hourly invoices. Kimbrough settled the case for the clients shortly before trial, but then was unsuccessful to get them to pay the fees incurred. Michael sued the clients Foulon to collect unpaid lawyer’s fees and costs. The Foulons asserted legal malpractice and breach of fiduciary duty counterclaims, seeking to avoid paying any fees to Kimbrough while claiming substantial damages. After a two week bench trial, Michael’s insurance defense co-counsel Sam Franklin defeated all the counterclaims of the former clients while Michael obtained about 95% of Kimbrough’s fees sought. Appellate counsel Phil Talmadge obtained prejudgment interest and defeated all of the defendant’s claims on appeal. Kimbrough ultimately recovered about $125,000 in fees and interest.

Aguilar v. Schmitt, King County Superior Court. Bellevue trial lawyer Bob Schmitt and his co-counsel settled personal injury claims of their clients for $400,000. Settlement funds were disbursed, the clients were paid, Schmitt and his co-counsel were paid their contingency fees and the files closed. Several years later, Schmitt’s clients sued Schmitt and his co-counsel for failing to disclose and remedy alleged conflicts of interest, for charging excessive fees and contending that Schmitt and his co-counsel had forged the client’s signature on a fee agreement. Schmitt’s clients sought disgorgement of all of the contingency fees on the $400,000 received, that the clients originally approved for payment. Schmitt hired Michael as his counsel. Michael retained an expert questioned document examiner who determined that the client’s signature on the fee agreement was genuine. After some brief discovery, Michael moved the court for summary judgment of dismissal. The trial court granted Schmitt’s motion and dismissed all claims with prejudice. Schmitt and his co-counsel avoided the possibility of having to pay back the entire contingency fee on the $400,000 recovery.

Dover Holdings v. City of Lacey, Thurston Co. # 05-2-01000-0. After prior counsel prevailed in condemnation action against the City of Lacey and obtained a substantial award of damages representing the value of the property condemned, client Dover retained Michael to obtain an award of fee shifting fees and costs provided for in Washington’s condemnation statute. Lacey contended the fee sward should not exceed $127,702.91. In a hotly contested motion hearing on the award of attorney’s fees to Dover as prevailing party, Michael obtained an award of fees in excess of $208,000, most of the fees sought by his client Dover.

Kelly v. P.U.D., U.S. Dist. Ct, E. D. of Wa. Law firm represented the public utility district in litigation with private parties. After the case had been pending for quite a while, the private parties sought to disqualify the law firm for failure to disclose and remedy a conflict of interest. A partner in the law firm had advised and counseled the private parties before the litigation started. Thereafter another partner in the law firm represented the P.U.D. The Federal district court found that the law firm had not properly disclosed and remedied the conflict of interest and ordered the law firm disqualified. The law firm withdrew and another law firm substituted. The P.U.D. through Michael demanded disgorgement of all of the lawyer’s fees paid of nearly $300,000 incurred as a consequence of the conflict of interest and disqualification. The P.U.D. retained Michael to represent it in the effort to obtain disgorgement. Without any litigation, Michael negotiated a refund of $250,000 in attorney’s fees, the great majority of the fees previously paid, and a waiver of any fees that had been incurred but not yet billed and paid.

Johnson v. Avalon Bay, King Co. Sup Ct. Attorney H.F. represented plaintiff Johnson in this serious workplace personal injury claim. HF associated Seattle attorney PW to assist with the case. After working on the case for a number of months, attorney PW withdrew from the case and asserted an attorney’s lien against the recovery of Plaintiff Johnson. HF ultimately settled the Johnson case for a substantial amount, which is covered by a confidentiality agreement. PW sought to be paid on his lien and demanded half of the substantial six figure lawyer’s fee. HF hired Michael to represent him. Michael successfully moved to quash PW’s attorney’s lien and the lien was dismissed. Sometime thereafter, Michael settled the claim of PW for about 23% of the original demand, largely based on PW’s firm’s hours.

Smith Alling Lane Law Firm v. Yoakum, Kitsap Co. Law firm sued client for $98,000 in unpaid fees arising from representation in dissolution of marriage. After informally asserting affirmative defenses and a counterclaim for damages for legal malpractice for negligent advice on federal tax issues, and challenging the reasonableness of fees, Michael negotiated a settlement whereby the parties dropped all claims against each other and entered into mutual releases. Michael’s client avoided payment of $98,000 in fees claimed.

In re Marriage of Green, King Co. 02-3-02471-1SEA. In this dispute over lawyer’s fees, Michael’s attorney-client asserted a claim of attorney’s lien for legal services performed for respondent wife Green, after the attorney had settled the dissolution’s property settlement with his client’s consent. When the client refused to pay anything of attorney’s fees, Michael moved to foreclose his client’s attorney’s lien and after a day-long trial, the attorney was awarded a judgment for fees, costs and discovery sanctions in the amount of $80,119. The judgment was paid in full.

PYP v. Fargo - private mediation. Michael’s law firm client, after obtaining a large, 6-figure settlement on behalf of its tort client, had its contingent fee challenged by the client as excessive, based on the client’s interpretation of the contingency fee agreement. The amount of the fee challenged by the client was approximately $107,000. Michael negotiated with the former client to enter into a mediation/arbitration process. At the mediation, the mediator convinced the former client that his interpretation of the fee agreement would never be accepted by him if the case had to be arbitrated. The $107,000 claim for fee reduction thereafter settled at mediation for $23,000.

KM v. RLMA. Lay client KM retained law firm to assist with debt claims against her late husband from business relationships. KM’s husband had a negligible estate. The law firm advised commencing a probate and did so. The law firm then advised its client KM to deny a valid claim against the estate of the husband, which resulted in the estate being sued. The law firm defended that lawsuit until the client ultimately resolved it herself. In the course of the dual representations, the law firm incurred over $86,000 in hourly fees. KM retained Michael to challenge the lawyer’s fees and Michael obtained expert probate opinions on the judgments of the law firm and the value of the legal services. Michael negotiated with the law firm and obtained mutual releases, where the law firm gave up its claim to the unpaid balance of over $46,000.

C.S., attorney v. Miriam S., client, King County Dist. Ct (Details subject to confidentiality agreement) This is another case where Michael represented a lay client who challenged the reasonableness of fees charged by her lawyer in a dissolution of marriage. The lawyer had been paid $55,000 and was claiming a substantial additional sum of fees. After raising the defense of excessive fees and breach of fiduciary duty for failing to disclose material facts to her client, the lawyer CS agreed to a settlement of the case for mutual releases and no additional fees paid by the client.

WFN v. AO, King Co. Sup. Ct. Attorney AO represented a lay client in a serious medical negligence case. She associated a professional colleague, RFN, a lawyer with vast experience in medical malpractice cases, to co-counsel the case with her. They orally agreed that RFN would receive 40% of AO’s contingency fee. RFN performed the services requested of him by AO and ultimately AO settled the case. APO then ran the client’s settlement monies through her trust account, and the asked RFN what he thought was fair for his fees. When he reminded her of their agreement that RFN would receive 40% of the contingency fee, AO refused to discuss it any further. RFN retained Michael who sued AO. After AP’s motion to dismiss RFN’s lawsuit was denied, AO settled and paid RFN $50,000.

Neri v. Rotkis, King Co. # 09-2-43066-7SEA. Attorney RP represented Plaintiff in a medical negligence case for several years. When he was unable to obtain a satisfactory settlement, RP associated attorney DM, an experienced medical negligence plaintiff’s counsel. RP and DM agreed to divide the contingency fee 75% to DM, 25% to RP. When the case was near to settlement, DM approached RP and asked how much he expected to be paid. RP insisted on the full 25% of the fee previously agreed upon. When DM refused, RP retained Michael to represent him. Michael obtained a written agreement under RPC 1.5(e) with the Plaintiff approving the 75/25% contingency fee split and then asserted an attorney’s lien on the recovery for 25% of the fee. Michael was able to obtain agreement with DM for his client RP to receive the previously agreed-upon fee of 25% of the contingency fee, without any litigation.

DiMario v. Wheeler Seafood, King Co. # 04-2-38398-6SEA. Plaintiff DiMario retained attorney ST in her claim for personal injuries. After lengthy dissatisfaction with the attorney, Ms. DiMario terminated ST and hired another lawyer who ultimately settled her claim for a substantial result before trial, substantially greater than the last settlement offer obtained by ST. With little actual work to show for it, ST asserted an attorney’s lien for a substantial sum. Client DiMario retained Michael to challenge the reasonableness of the reasonableness of the fees claimed by her prior attorney ST. Upon Michael’s motion, the court reduced the fees claimed by the first attorney by about 60%.

THESE CASES ILLUSTRATE RESULTS OBTAINED BY MICHAEL AS COUNSEL FOR VARIOUS LAY AND LAWYER CLIENTS. THESE CASES ARE NOT OFFERED TO LEAD ANYONE TO FORM AN EXPECTATION THAT SIMILAR RESULTS COULD BE OBTAINED FOR OTHER CLIENTS IN SIMILAR MATTERS WITHOUT REFERENCE TO THE SPECIFIC FACTUAL AND LEGAL CIRCUMSTANCES OF EACH POTENTIAL CLIENT’S CASE.

“While the blush is still on the rose, I want to thank you again for an excellent job. I can’t think of a case that I have wanted to win more. You made that possible through an extraordinarily fine piece of lawyering.”

– Fred M. Zeder of Peterson Young Putra, successful litigant in Taylor v. Shigaki, 1997