T. Horn, for nonparty-appellant.
J. Shoot, for nonparty-respondent Golomb.
T. Breakstone, for nonparty-respondent Manheimer.
DiFIORE, CHIEF JUDGE
Jose and Ada Marin obtained an $8 million settlement for
serious injuries Jose Marin sustained when he fell
approximately 40 feet while working on a building in
Manhattan. This appeal concerns a fee dispute between
plaintiffs' attorney-of-record in that action, Sheryl
Menkes, and two attorneys she engaged to assist her: Jeffrey
A. Manheimer and David B. Golomb. Based on the plain language
of their respective fee-sharing agreements, we conclude that
Manheimer is entitled to 20% of net attorneys' fees and
Golomb is entitled to 12% of net attorneys' fees. We
therefore modify the Appellate Division order accordingly.
February 2009, Menkes engaged Manheimer to act as co-counsel
and provide advice in the action . Their written agreement
provided that Manheimer would receive 20% of net
attorneys' fees if the case settled before trial and 25%
once jury selection commenced. Neither attorney informed the
clients of Manheimer's involvement, although Manheimer
believed Menkes had done so. The failure to inform the
clients violated the former Code of Professional
Responsibility DR 2-107 (a) (22 NYCRR 1200.12 [a]) and the
current Rules of Professional Conduct (22 NYCRR 1200.0) rule
1.5 (g) . In June 2009, the agreement was
amended to specify that Manheimer would act solely in an
advisory capacity and would "not contact the client[s],
defendants['] experts or the [c]ourt" without
Menkes's permission. The fee arrangement was unchanged.
In August 2009, Menkes wrote to Manheimer unilaterally
discharging him and advising him that his portion of the fees
would be determined on a quantum meruit basis. Manheimer did
not respond to Menkes; he did no further work on the case.
August 2012, Menkes obtained partial summary judgment on
liability under Labor Law § 240 (1) on plaintiffs'
behalf. She later sought assistance from Golomb for an
upcoming mediation - scheduled for May 20, 2013 - and a
potential trial on damages. In March 2013, Menkes and Golomb
entered into a written agreement, which stated, in relevant
"I [Golomb] have agreed to review the file, provide
whatever services are needed, with your and your office's
assistance, to prepare it for the mediation and to handle the
mediation. For those services, I will be [sic] receive twelve
(12%) percent of all attorneys' fees whenever the case is
resolved, whether by settlement, verdict after trial or
appeal, calculated after the attorneys have been reimbursed
for all expenses laid out. This percentage due shall become
fixed and owed upon execution of this agreement.
"If the case does not resolve at the mediation,
presently scheduled for May 20, 2013, then I will be
responsible, with your and your office's assistance as
requested, for preparing for trial and trying the case. After
such mediation, I will be entitled to forty (40%) percent of
all attorneys' fees whenever the case is resolved,
whether by settlement, verdict after trial or appeal,
calculated after the attorneys have been reimbursed for all
expenses laid out. In the event this matter has to be tried,
the total of all attorneys' fees to which I am entitled
for all of the services set forth, including mediation, shall
be forty (40%) percent of all attorneys' fees whenever
the case is resolved, whether by settlement, verdict after
trial or appeal, calculated after the attorneys have been
reimbursed for all expenses laid out."
mediation began on May 20, 2013 at 2:00 p.m. Although the
parties' original settlement positions were approximately
$17 million apart, by the time the session concluded at
approximately 7:00 p.m., the gap was about $1.5 million.
Since the excess insurance carriers lacked authority to
increase their offer at that time, the mediation session
ended without a settlement agreement. On May 22, 2013, and
during the following week, the mediator maintained contact
with both Golomb and the carriers. On May 31, 2013, the
mediator telephoned Golomb to convey a settlement offer ...