In Wortman v. Cheng,  which we started to write about last week Justice Gische lays out a primer of the various attorney fee claims, and how they interrelate with legal malpractice.

"The elements of a claim for quantum r meruit am:( It)he performance of services in good faith; (2) the acceptance of services by the person to whom they are rendered; (3) an expectation of compensation; and (4) the reasonable value of the services (Georgia Malone & Go.. Inc, v, Ralph Rjeder (86 A.D.3d 406,410 [1st Dept,  2011])   The existence of a valid and enforceable written contract governing the disputed subject matter precludes plaintiffs from recovering in quantum meruit (Shelffer v. Shenkman Capital Management. Inc,, 291 A.D.2d 295 [1st Dept,  2002).

In connection with this particular cause of action, Wortman makes no claim that the March 22, 2001 flat fee retainer is invalid or should be invalidated. It is unrefuted that the contract obligates Chang "to pay for our services on the basis of a flat fee of $15,000" payable in 3 installments. It is unrefuted that she did, in fact, pay that fee, It is also unrefuted that Kenneth Cahill, the person who intended to open a restaurant at the building, paid a part of the fee, although not a signatory to that retainer. The flat fee retainer states that it is "in connection with your transactions for the establishment of a restaurant at [207 Second Avenue] …" referencing an agreement between Chang and Cahill. The retainer also states that the firm has "agreed to represent Janet Chang and
Kevin Cahill in connection with the following . . ." The $15,000 is not identified as a "retainer or
specify that Chang would thereafter be billed on an hourly basis. There is no provision
for the law firm to charge for its disbursements.

There are different types of billing arrangements that an attorney and client agree to, depending on the type of legal services being rendered and the nature of the case. Chang and Wortman had a contingency arrangement for the malpractice action, but agreed that a "flat fee" would be charged for the foreclosure actions and to bring the Chang/Cahill restaurant agreement to fruition. In a flat fee arrangement, as the words suggest, all work is done for a set, agreed to amount. In setting the flat fee, it is expected that an attorney has evaluated the complexity of the work required and set his or her fee accordingly. If it turns out the work needed is less than anticipated, than the attorney may benefit from the arrangement in the sense that he or she recoups more than his or her customary hourly rate. On the other hand, If the work turns out to be more complex than anticipated, the attorney has no basis to collect more than the agreed to amount, unless the retainer so provides (compare: Manufacturers & Traders Trust Co v. Dougherty, 11 A.D.3d 1019 [4th Dept 2004]  although retainer indicated work would be done for a flat fee of $1,250, the mortgage allowed plaintiff to recover “all reasonable legal fees from defaulting defendant; Webbe v. Webbe,267 AD2d 784 [3rd Dept 1099] in divorce action, defendant’s attorney had a flat fee retainer of $2,500,. but was able to seek legal fees from plaintiff).

The flat fee retainer at bar contains no Imitations, conditions, caveats or an expiration date. The $15,000 is not identified as a retainer to be replenished. The only additional monies that the law firm could recover under the flat free retainer were for “any appeals.” Therefore, any argument by Wortman that the retainer agreement regarding the foreclosure matters really means anything other than what it expressly provides is without any factual or legal basis. There is no indication within the four corners of this retainer agreement that it was intended to expire or the parties anticipated to receive or make additional payment. Since there is no ambiguity in the retainer agreement, Wortman’s effort to create an ambiguity where none exists is unavailing (In re Koppel, 95 AD3d 453 (1st Dept, 2012) The issue of whether Wortman complied with the requirements of Part 1215 of Title 22 of the Official Compilations of Codes, Rules and Regulations of the State of New Yo& (22 NYCRR 1215”) has been addressed by the parties in connection with the parties’ arguments about whether the retainer expired. Since the flat fee retainer was signed before this rule became effective (March 4, 2002), 22 NYCRR 1215.2 does not apply to the flat fee retainer. Even if it did, noncompliance with the requirements of 22 NYCRR 1215.1 would not bar the law firm from recovering in quantum meruit under certain circumstances (Nabi v. Sells, 70 A.D.3d 252 [1st Dept 2009]

Chang has proved the flat fee retainer is valid, enforceable and unambiguous,thereby meeting her burden and shifting it to the plaintiff law firm to demonstrate the existence of a triable issue of fact (Alvaraz w, Prospect Hosp., 68 N.Y.2d 320, 324 [ 1986];  Zuckerman v, City of New York ,49 N.Y.2d 557 [1980]). The law firm has not met its burden of showing, as it claims, that the flat fee retainer agreement expired or that it is ambiguous, Therefore, Chang is entitled to summary judgment dismissing the quantum meruit cause of action in the complaint to the extent that the law firm’s claims fall within the ambit of the work subject to the flat fee agreement and such work was performed before the firm was permitted to withdraw as counsel by Justice Heitler.

We’ll finish this case on Tuesday