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Schultz v. Hughes

Supreme Court of New York, Second Department

September 18, 2013

Paula Schultz, plaintiff,
v.
Terrance Hughes, et al., defendants. (Matter No. 1) In the Matter of Edelman, Krasin & Jaye, PLLC, appellant,
v.
Arthur G. Trakas, etc., respondent. (Matter No. 2) Index No. 17249/09

Edelman, Krasin & Jaye, PLLC, Carle Place, N.Y. (Jarad Lewis Siegel of counsel), appellant pro se.

Arthur G. Trakas, Astoria, N.Y. (Andrew B. Schultz of counsel), respondent pro se.

REINALDO E. RIVERA, J.P., PETER B. SKELOS, CHERYL E. CHAMBERS, LEONARD B. AUSTIN, JJ.

DECISION & ORDER

In an action to recover damages for personal injuries and a proceeding, inter alia, pursuant to Judiciary Law § 475 to apportion attorney's fees, Edelman, Krasin & Jaye, PLLC, appeals, as limited by its brief, from so much of an order of the Supreme Court, Queens County (Schulman, J.), entered February 27, 2012, as denied, without a hearing, those branches of its cross motion and petition which were for a determination that the plaintiff's former attorney, Arthur G. Trakas, was discharged for cause.

ORDERED that the order is reversed insofar as appealed from, on the law, with costs, and the matter is remitted to the Supreme Court, Queens County, for a hearing to determine whether Arthur G. Trakas was discharged with or without cause, and the amount of compensation, if any, due to him.

In June 2009, the plaintiff retained Arthur G. Trakas to commence the instant action to recover damages for personal injuries allegedly sustained by her as a result of an automobile accident (hereinafter the personal injury action). In January 2010, she discharged Trakas and retained the appellant, Edelman, Krasin & Jaye, PLLC (hereinafter the Edelman firm), as counsel to represent her in the personal injury action. Thereafter, Trakas and the Edelman firm entered into a stipulation dated January 28, 2010, wherein they agreed, inter alia, that the attorney's fees to which Trakas would be entitled "shall be based on a contingency fee basis." In June 2011, the Edelman firm negotiated a substantial settlement on the plaintiff's behalf.

In November 2011, the Edelman firm commenced a proceeding, inter alia, pursuant to Judiciary Law § 475 to apportion the attorney's fees between it and Trakas. The Edelman firm further sought a determination that Trakas had been discharged for cause, alleging that he violated several disciplinary rules and, thus, was not entitled to any attorney's fees for services rendered. Upon a motion by Trakas, wherein he disputed the claim that he had been discharged for cause, and a cross motion by the Edelman firm, the Supreme Court summarily determined on the papers submitted that Trakas had not been discharged for cause.

A client has "an absolute right, at any time, with or without cause, to terminate the attorney-client relationship by discharging the attorney" (Campagnola v Mulholland, Minion & Roe, 76 N.Y.2d 38, 43; see Doviak v Finkelstein & Partners, LLP, 90 A.D.3d 696, 698; Coccia v Liotti, 70 A.D.3d 747, 757). Where the discharge is without cause, the attorney may recover the reasonable value of his or her services in quantum meruit (see Campagnola v Mulholland, Minion & Roe, 76 N.Y.2d at 44; Teichner v W & J Holsteins, 64 N.Y.2d 977, 979; Callaghan v Callaghan, 48 A.D.3d 500, 500-501; Lopresti v Ingenito, 229 A.D.2d 567). In contrast, "[a]n attorney who is discharged for cause... is not entitled to compensation or a lien" (Callaghan v Callaghan, 48 A.D.3d at 501; see Campagnola v Mulholland, Minion & Roe, 76 N.Y.2d at 44; Coccia v Liotti, 70 A.D.3d at 757). An attorney who violates a disciplinary rule may be discharged for cause and is not entitled to fees for any services rendered (see Doviak v Finkelstein & Partners, LLP, 90 A.D.3d at 699; Quinn v Walsh, 18 A.D.3d 638; Matter of Satin, 265 A.D.2d 330).

"Where there are conflicting claims as to... whether an outgoing attorney was discharged with or without cause, a hearing is necessary to resolve such dispute" (Byrne v Leblond, 25 A.D.3d 640, 642; see Teichner v W & J Holsteins, 64 N.Y.2d at 979). Here, Trakas and the Edelman firm presented conflicting claims as to whether Trakas was discharged with or without cause. Thus, the Supreme Court should have conducted a hearing to resolve that issue. Accordingly, we remit the matter to the Supreme Court, Queens County, for a hearing to determine whether Trakas was discharged with or without cause, and the amount of compensation, if any, due to him.

RIVERA, J.P., SKELOS, CHAMBERS and AUSTIN, JJ., concur.


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