Facts

Defendant Nathan LaMoure represented plaintiff Mesa West in an insurance bad faith action against the plaintiff's insurance carrier on a contingency basis. During trial, a confidential settlement was reached. The defendant was paid a 50 percent contingency fee. The plaintiff and defendant placed $40,235 in trust regarding disputed fees pertaining to services performed for the plaintiff in other matters.

During fee arbitration, and a trial de novo, the plaintiff sought to void the contingency fee agreement and have the court determine a reasonable fee for the defendants' services pursuant to California Business & Profession Code Section 6147(b).

PLAINTIFF'S CONTENTIONS:
The plaintiff contended that the attorney-client fee agreement was voidable under California Business & Profession Code 6147(a)(4) because it did not contain a statement that the fee was not set by law.

The attorney-client fee agreement was voidable under California Business & Profession Code 6147(a)(2) because it did not adequately include a statement as to how disbursements and costs incurred would affect the contingency fee and the client's recovery. The attorney-client fee agreement was voidable under Cal. Bus. & Prof. Code 6147(a)(3) because it did not include a statement as to what extent the client could be required to pay compensation to the attorney for related matters not covered by the contingency contract. The disputed claims made for non-related matters were not subject to invalid lean provisions in the voided fee agreement, and were partially time-barred.

DEFENDANT'S CONTENTIONS:
The defendant contended that the plaintiff, a dissolved corporation, lacked standing to pursue the action. The plaintiff actually did negotiate the contingency percentage, despite the omission of a written statement that it was not set by law and was fully negotiable. The plaintiff was estopped to void the agreement, inter alia, by virtue of its being negotiated, by having agreed to distribution of the settlement proceeds after dispute, by limiting the dispute to $40,235.

Result

The court ruled that the fee agreement was void, assessed the reasonable value of defendants' services to be $364,110. After payments of costs, including payment to other attorneys who defendant associated with, the defendant was required to disgorge the balance of the fee to the plaintiff.

Other Information

The defendant has filed a notice of appeal.