Alan Kaye, Md Versus Ronald A. Karp and Law Office of Karp, Wigodsky, Norwind & Gold, P.A. ( 2019 )

ALAN KAYE, MD NO. 19-CA-194
VERSUS FIFTH CIRCUIT
RONALD A. KARP AND LAW OFFICE COURT OF APPEAL
OF KARP, WIGODSKY, NORWIND &
GOLD, P.A. STATE OF LOUISIANA
ON APPEAL FROM THE FIRST PARISH COURT
PARISH OF JEFFERSON, STATE OF LOUISIANA
NO. 158-893, DIVISION "B"
HONORABLE THOMAS F. GARDNER, JUDGE AD HOC PRESIDING
December 30, 2019
STEPHEN J. WINDHORST
JUDGE
Panel composed of Judges Fredericka Homberg Wicker,
Stephen J. Windhorst, and John J. Molaison, Jr.
DECEMBER 18, 2018 JUDGMENT AFFIRMED; FEBRUARY 21, 2019
JUDGMENT REVERSED IN PART, JUDGMENT AMENDED AND
AFFIRMED AS AMENDED
SJW
FHW
JJM
COUNSEL FOR PLAINTIFF/APPELLEE,
ALAN M. KAYE, MD
Paul A. Lea, Jr.
COUNSEL FOR DEFENDANT/APPELLANT,
LAW OFFICE OF KARP, WIGODSKY, NORWIND & GOLD, P.A.
Shayna Beevers Morvant
Steven M. Mauterer
WINDHORST, J.
Appellant, the Law Office of Karp, Wigodsky, Norwind & Gold, P.A. (“the
Firm”), seeks review of (1) the trial court’s February 21, 2019 judgment in favor of
appellee/plaintiff, Alan Kaye, M.D., and against the Firm in the amount of Twenty
Thousand ($20,000) dollars, 15% attorney fees on the principal amount, legal
interest from the date of judicial demand until paid and all court costs; and (2) the
trial court’s December 18, 2018 interlocutory judgment denying the Firm’s motion
for partial summary judgment. For the reasons stated herein, we affirm the trial
court’s December 18, 2018 judgment denying the Firm’s motion for partial summary
judgment. We further reverse the award of attorney fees in the February 21, 2019
judgment, amend the judgment to delete the award of attorney fees and as amended,
affirm the February 21, 2019 judgment.
PROCEDURAL HISTORY
On March 28, 2016, Dr. Kaye, a board certified anesthesiologist practicing
and living in Jefferson Parish, filed a petition on open account in First Parish Court
against defendants, Ronald Karp (“Karp”), individually, and the Firm, a Maryland
law firm. In the petition, Dr. Kaye contended he was contacted and retained by the
Firm to testify as an expert witness in a medical malpractice case involving the
Firm’s client, Delores Moore, in Virginia, as per his fee schedule that he emailed to
the Firm. He asserted the Firm agreed to pay for his services and directed him to
examine Ms. Moore out of state, review numerous and voluminous medical records,
and provide deposition and trial testimony as an expert. The petition alleged that the
Firm refused to pay the balance of his bill for services rendered in the amount of
$27,437.47, despite demand.
In response, defendants filed exceptions of lack of subject matter jurisdiction,
personal jurisdiction, and no cause of action. Before the hearing on defendants’
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exceptions, Dr. Kaye filed a motion to amend his petition lowering the amount
claimed to $20,000.00 to meet the jurisdictional requirements of parish court.1
On June 22, 2016, the trial court granted Karp’s exception of no cause of
action and Karp was dismissed with prejudice. The trial court found the exception
of lack of subject matter jurisdiction “moot considering the filing of the Motion to
Amend Petition reducing the principal demand to $20,000.00.” The trial court
overruled the Firm’s exception of personal jurisdiction and further found that the
exception of lack of personal jurisdiction as to Karp was “moot and/or pretermitted.”
The Firm sought supervisory review of the judgment overruling its exception
of lack of subject matter jurisdiction with this Court. The majority of a five-judge
panel of this Court granted the writ application, granted the Firm’s exception of lack
of personal jurisdiction, and remanded the matter to the trial court for further
proceedings.
On October 4, 2016, in response to this Court’s disposition, Dr. Kaye filed a
motion to file a second amended petition, which was granted. The second amended
petition, filed November 18, 2016, alleged that the Firm contacted him to retain his
services as an expert and described in detail the services he provided at the request
of and under the direction of the Firm. Dr. Kaye alleged that he performed the
services in accordance with the agreement in Louisiana and out of state. He asserted
that his deposition for the medical malpractice case was taken in Jefferson Parish
and that a member of the Firm traveled to Louisiana to prepare for, attend, and
defend Dr. Kaye in the deposition. The second amended petition alleged that the
Firm was indebted to him in the amount of $20,000.00.
On December 8, 2016, the Firm filed an exception of lack personal jurisdiction
and dismissal with prejudice as to the second amended petition. On April 19, 2017,
1 The record does not contain an amended petition attached to or filed with this motion.
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the trial court granted the exception, dismissing Dr. Kaye’s claims against the Firm
with prejudice. Dr. Kaye appealed. On December 27, 2017, this Court found that
the second amended petition, on its face, established sufficient minimum contacts
over the Firm such that jurisdiction in Louisiana was proper. This Court reversed
the trial court’s judgment and remanded for further proceedings.
On March 21, 2018, the Firm filed an answer and affirmative defenses to the
second amended petition. On September 7, 2018, the Firm filed a motion for partial
summary judgment arguing that Dr. Kaye was not entitled to attorney fees pursuant
to La. R.S. 9:2781. The Firm claimed that the evidence showed that Dr. Kaye failed
to submit a written demand correctly setting forth the amount owed pursuant to La.
R.S. 9:2781. On December 18, 2018, the trial court denied the Firm’s motion.
The matter proceeded to a trial on the merits on February 6, 2019. At the
conclusion of the trial, the trial court rendered judgment in favor of Dr. Kaye and
against the Firm in the amount of Twenty Thousand ($20,000.00) dollars, 15%
attorney fees on the principal amount, legal interest from the date of judicial demand
until paid and all court costs. The judgment was signed on February 21, 2019.2 On
February 21, 2019, the trial court issued a separate document captioned “Findings
of Fact, Reasons for Judgment, and Order for Entry of Judgment.” This appeal
followed.
FACTS
At the trial, the following uncontroverted facts were established through the
evidence and testimony. In 2014, Karp, a managing partner at the Firm, contacted
Dr. Kaye and requested he serve as an expert witness in the Moore case pending in
Virginia. Dr. Kaye, as part of his usual business practice, sent Karp his fee schedule
for rendering professional services. The fee schedule provided the following rates
2 For purposes of this appeal, this opinion is rendered as to this judgment.
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for Dr. Kaye’s services: (1) general rate of $500.00 per hour; (2) trial testimony
$5,000.00 a day; (3) travel expenses $100.00 per hour; (4) deposition testimony
$800.00 per hour; and (5) initial retainer fee of $5,000.00. In October 2014, after
reviewing Dr. Kaye’s fee schedule, the Firm mailed Dr. Kaye the initial retainer fee
of $5,000.00 and the medical records for their client in the Moore case. Over a
period of approximately 17 months, Dr. Kaye provided on-going professional
services to the Firm, including the following: (1) frequently discussing the Moore
case with several attorneys at the Firm; (2) reviewed and re-reviewed after updates,
the deposition transcripts of experts and fact witnesses, medical literature, 3 expert
reports, and records; (3) examined Ms. Moore on three separate occasions (two times
in Virginia and once in Louisiana); (4) appeared for a deposition in Louisiana that
lasted at least four hours; (5) assisted with creating an animation for the Moore case;
(6) spent two days in Virginia for the Moore trial, working with the Firm attorneys
the entire day before the Moore trial until approximately 1:00 A.M. and the day of
the trial testifying.
Dr. Kaye testified he does not have a business enterprise. He is a “one-man
operation” and that as part of his usual billing practice he sent invoices for services
rendered to the Firm. Dr. Kaye sent the Firm invoices for work performed for a total
amount due of $52,651.73, of which the Firm only paid Dr. Kaye $21,614.23,
leaving a remaining balance due of $31,037.50. The first invoice4 issued to the Firm
was for a total amount due of $9,750.00. In the first invoice, the Firm was given
credit for its $5,000.00 retainer fee leaving a remaining balance of $4,750.00, which
was subsequently paid by the Firm.5 The second invoice issued to the Firm was for
3 Dr. Kaye testified he reviewed over a 100 articles during the period of time he was retained by the Firm.
The Firm did not submit any testimony or evidence to refute Dr. Kaye’s credible testimony.
4 It appears there were more than four invoices; however, the invoices are numbered one through four in
this opinion based on the invoices admitted into evidence and considered by this Court.
5 Although the check for $4,750.00 was admitted into evidence as “P5,” it is not contained in the record.
We note the first invoice was admitted into evidence as P5. Nevertheless, as this fact was not disputed by
the parties, we accept it for purposes of determining what the Firm paid Dr. Kaye.
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a total amount due of $6,864.23. The Firm subsequently submitted two payments in
the amount of $2,000.00 each. Dr. Kaye testified that he stopped receiving payments
thereafter and spoke with Karp. He informed Karp that if he did not start receiving
payment, he would not attend his deposition or testify at the trial in Virginia. Dr.
Kaye testified Karp reassured him that he would be paid in full after the trial. Dr.
Kaye sent a third invoice that contained the remaining balance due from the second
invoice and the new amounts of $2,275.00 and $15,130.00 for a total amount due of
$22,169.23.6 The Firm remitted another $5,000.00 payment. Dr. Kaye sent a fourth
invoice, which included the remaining balance due of $12,304.97 and a new amount
due of $18,632.50 for “Feb.-March, 2016,” for a total amount due of $30,937.47.7
Dr. Kaye testified the new amount included his fees for two (2) days of trial (day
before trial and day of trial) plus expenses and food. When further questioned about
alleged double billing for trial testimony, Dr. Kaye testified that he did not double
bill for trial testimony. He testified that he charged $5,000.00 for his testimony on
the day of trial and a second $5,000.00 was charged for the day before trial (plus
expenses i.e., food, travel). He stated he would normally charge his hourly rate
($500.00 per hour) for his time spent the day before trial; however, in this case, it
was cheaper to charge the Firm the flat fee charged for trial dates ($5,000.00) then
the amount charged hourly because he was with the Firm attorneys until about 1:00
A.M. He testified he was giving the Firm a discount. Thereafter, Dr. Kaye testified
the Firm only remitted an additional payment $2,864.23. Dr. Kaye testified that no
one at the Firm ever questioned his invoices or requested he provide a more in depth
or detailed invoice to justify the amount billed for services rendered prior to him
6 We note there is an error in the mathematical calculation on the third invoice resulting in a $100.00
difference. Using the amounts provided on the invoice, the correct total amount due would be $22,269.23
instead of $22,169.23.
7 We also note there is an error in the mathematical calculation on the fourth invoice resulting in a $100.03
difference. Using the amounts provided on the invoice, the correct total amount due would be $31,037.50
instead of $30,937.47.
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filing this petition on open account. He further testified that after his trial testimony,
he relinquished all of his documents to the Firm as he no longer had any need for
them.
Dr. Kaye testified that when he realized he was not going to be paid the
remaining amount due, he sent a demand letter in the amount of $30,937.47 to the
Firm on March 8, 2016. When he did not receive payment, he filed a petition on
open account, wherein he asserted that $27,437.47 was due and owing on the
account. He subsequently amended his petition to contend the Firm owed him
$20,000.00 to meet the jurisdictional requirements of parish court. He issued
another demand letter dated September 14, 2016 to the Firm, asserting the amount
due and owing on the open account was $20,000.00.
DISCUSSION
On appeal, the Firm seeks review of the trial court’s February 21, 2019
judgment awarding Dr. Kaye $20,000 plus attorney fees on open account, and the
trial court’s December 18, 2018 interlocutory judgment denying the Firm’s motion
for partial summary judgment on the issue of attorney fees.
December 18, 2018 interlocutory judgment
The Firm contends that the trial court erred in denying its motion for partial
summary judgment. In its motion, the Firm asserted that Dr. Kaye could not collect
attorney fees pursuant to La. R.S. 9:2781. The Firm argued that Dr. Kaye failed to
submit a written demand setting forth the correct amount due on the account, and
therefore, he was not entitled to attorney fees under the open account statute.
Specifically, in the motion and on appeal, the Firm states that Dr. Kaye submitted
three different amounts as due and owing: (1) the March 8, 2016 demand letter
asserting a balance due of $30,937.47; (2) the March 28, 2016 petition asserting a
balance due of $27,437.47; and (3) the amended petition asserting a balance due of
$20,000.00. In its motion and on appeal, the Firm contends that it established that
19-CA-194 6
there were inaccuracies in the account and that the correct amount was not
demanded; therefore, as a matter of law, attorney fees should have been denied.
Generally, attorney fees are not due and owing a successful party unless
specifically provided for by contract or by statute. Killebrew v. Abbot Laboratories,
359 So.2d 1275 (La. 1978). Statutes awarding attorney fees are strictly construed
because an award of attorney fees is penal in nature. A Better Place Inc. v. Giani
Investment Co., 445 So.2d 728 (1984). La. R.S. 9:2781 provides for reasonable
attorney fees for the collection of an amount due on an open account when a party
submits a written demand correctly setting forth the amount owed. See Frank L.
Beier Radio, Inc. v. Black Gold Marine, Inc., 449 So.2d 1014 (1984). La. R.S.
9:2781 provides, in pertinent part:
A. When any person fails to pay an open account within
thirty days after the claimant sends written demand
therefor correctly setting forth the amount owed that
person shall be liable to the claimant for reasonable
attorney fees for the prosecution and collection of such
claim when judgment on the claim is rendered in favor
of the claimant. . . . .
Thus, in order to establish a claim for attorney fees pursuant to La. R.S. 9:2781, a
party is required to submit a written demand correctly setting forth the amount due
and owing.
The trial court denied the motion for partial judgment finding genuine issues
of material fact existed as to the evidence submitted. Upon de novo review of the
motion for partial summary judgment and the exhibits attached thereto, we find the
trial court did not err in denying the Firm’s motion for partial summary judgment as
rendering a decision on the motion would have required the trial court to weigh
evidence and the credibility of Dr. Kaye, which are not proper in a motion for
summary judgment. Accordingly, this argument is without merit.
19-CA-194 7
Trial on the Merits – award of $20,000.00
Pursuant to La. R.S. 9:2781, an “open account” is any account for which a
part or all of the balance is past due, whether it reflects one or more transactions and
whether at the time of contracting the parties expected future transactions. The
statute expressly provides that an “open account” includes debts incurred for
professional services. La. R.S. 9:2781 D.
In order to sustain an action on open account, a creditor bears the burden of
proving the demand by a preponderance of the evidence. Ochsner Clinic Found. v.
Arguello, 11-326 (La. App. 5 Cir. 11/29/11), 80 So.3d 622, 625. In order to prove
an open account, the creditor must first prove the account by showing that it was
kept in the course of business and by introducing supporting testimony regarding its
accuracy. Id. Once the creditor has established a prima facie case, the burden shifts
to the debtor to prove the inaccuracy of the account or to prove that the debtor is
entitled to certain credits. Id. The amount of an open account is a question of fact
which may not be disturbed on appeal absent manifest error. Chrysler Fin. Co.,
L.L.C. v. Gene Ducote Auto., L.L.C., 04-1223 (La. App. 5 Cir. 03/01/05), 900 So.2d
119, 121.
Under this standard of review, a court of appeal may not set aside a finding of
fact in the absence of “manifest error” or unless it is “clearly wrong.” Rosell v.
ESCO, 549 So.2d 840, 844 (La. 1989). This manifest error-clearly wrong standard
of review is based upon a recognition that the trial court is in a better position to
evaluate live witnesses, as compared with the appellate court's access only to a cold
record, as well as the proper allocation of trial and appellate functions between the
respective courts. Prejeant v. Gray Ins. Co., 15-87 (La. App. 5 Cir. 09/23/15), 176
So.3d 704, 708–09. Therefore, where there is conflict in the testimony, reasonable
evaluations of credibility and reasonable inferences of fact should not be disturbed
upon review, even though the appellate court may feel that its own evaluations and
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inferences are as reasonable. Id. at 709. In order to reverse a finding of fact, the
appellate court must: (1) find from the record that a reasonable factual basis does not
exist for the finding, and (2) determine that the record establishes the finding is
clearly wrong or manifestly erroneous. Id.In several assignments of error, the Firm contends that the trial court was
manifestly erroneous in rendering judgment in favor of Dr. Kaye and against the
Firm in the amount of Twenty Thousand ($20,000.00) dollars.
The trial court found Dr. Kaye rendered professional services as shown on the
invoices and that the Firm was liable for the balance due (an amount over
$20,000.00), subject to the $20,000.00 jurisdictional limit of the court, and awarded
Dr. Kaye $20,000.00. In written reasons, the trial court made numerous findings of
fact to support his ruling in addition to reasons stated on the record at the time
judgment was rendered in open court. We find that the factual conclusions made by
the trial court are supported by substantial evidence and testimony adduced at trial.
While the Firm challenged Dr. Kaye’s credibility and the correctness of his invoices
and billing methods, it is undisputed that at no time did anyone at the Firm
contemporaneously object to or request that Dr. Kaye provide more frequent and
detailed invoices prior to Dr. Kaye’s testimony in the Moore case in Virginia.
Additionally, the Firm did not submit any evidence or testimony at trial to refute Dr.
Kaye’s credible testimony regarding (1) the invoices; (2) his billing methods; (3) the
alleged double-billing; (4) time and services rendered; (5) the alleged inconsistencies
in his prior affidavit, deposition and invoices; and (5) returning all documents and
his file to the Firm upon completion of his trial testimony.8 Under these
circumstances, we cannot say the trial court was manifestly erroneous or clearly
8 The only witness the Firm called to testify was Robert Leembruggen, “the Controller” at the Firm. Despite
notifying the Firm of what he believed to be incorrect formatting of the invoices and cost, Dr. Leembruggen
testified he was not aware of any communication sent to Dr. Kaye advising him that the Firm believed his
invoices were incorrect.
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wrong in finding that the Firm was liable to Dr. Kaye for the balance due on the
invoices, subject to the $20,000.00 jurisdictional limit of the parish court.
Trial on the Merits – award of attorney fees
The Firm contends the trial court erred in awarding attorney fees because Dr.
Kaye failed to assert the correct amount due upon demand. As to the trial court’s
February 21, 2019 judgment awarding Dr. Kaye attorney fees, upon review and for
the following reasons, we reverse.9
To recover attorney fees under the open account statute, a claimant must send
a written demand correctly setting forth the amount owed on the open account. La.
R.S. 9:2781. Because an award for attorney fees is exceptional and penal in nature,
the statute must be strictly construed. Jefferson Door Co., Inc. v. Lewis, 98-26 (La.
App. 5 Cir. 05/27/98), 713 So.2d 835, 837. The demand letter must correctly set
forth the amount due at the time the letter was written. Sears, Roebuck & Co. v.
Larose, 460 So.2d 8 (La. App. 1 Cir. 1984). The amount stated in the demand letter
and the amount recovered in the judgment do not have to be the same for a party to
recover attorney fees under La. R.S. 9:2781. Texas Industries, Inc. v. Roach, 426
So.2d 315 (La. App. 2 Cir. 1983).
On March 8, 2016, Dr. Kaye sent the Firm a demand letter stating the amount
due was $30,937.47. At trial, Dr. Kaye testified the initial amount remaining on the
invoices was $31,037.50. Based on the invoices, the amount due was $30,937.47.
However, a review of the invoices shows that there was a mathematical error in the
third and fourth invoices; therefore, the correct amount due based on the payments
made by the Firm was $31,037.50. Thus, there is a difference of $100.03 between
9 In his appellee brief, Dr. Kaye contended that the amount of attorney fees was incorrect and that the
judgment should be modified. He further sought damages for a frivolous appeal. However, Dr. Kaye did
not appeal the trial court’s February 21, 2019 judgment or file an answer to the appeal requesting this relief.
The failure either to cross-appeal or to answer the appeal precludes this Court from considering Dr. Kaye’s
requested relief. See La. C.C.P. art. 2082; La. C.C.P. art. 2133; Petrie v. Michetti, 10-122 (La. App. 5 Cir.
01/11/11), 59 So.3d 430, 441; Vicknair v. St. James School Bd., 06-381 (La. App. 5 Cir. 10/31/06), 945
So.2d 116, 119; Franks v. Royal Oldsmobile Co., 605 So.2d 633, 635 (La. App. 5 Cir. 1992).
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the amount testified as due, the amount established by the invoices, and the demand
letter.
On March 28, 2016, Dr. Kaye filed a petition on open account asserting the
amount due was $27,437.47. Dr. Kaye credibly explained that after his demand
letter, but prior to the filing his petition, he received a payment in the amount
$3,500.00 from The Hancock Law Firm for his deposition testimony, with which he
credited the Firm’s account. However, considering the mathematical calculation
errors in the third and fourth invoices and the payments submitted by the Firm, the
evidence established the correct amount due after deducting the $3,500.00 was
$27,537.50 instead of $27,437.47, a difference of $100.03.
Dr. Kaye testified he amended his petition to contend that the Firm owed him
$20,000.00 to meet the jurisdictional requirements of parish court. He testified he
believed that he would receive the amount due faster in parish court than if the matter
had been filed in the district court.
A correct statement of the amount due in the demand letter is a condition
precedent to an award of attorney fees under the statute. Here, the creditor, Dr. Kaye,
had the burden of clearly showing the accuracy of the statement. Considering the
facts of this case, the different amounts demanded, including a demand for the
“jurisdictional limit,” and the mathematical errors in the invoices and demands
submitted to the Firm, we find Dr. Kaye did not correctly set forth the amount due
as such that would entitle him to attorney fees under the statute. We therefore
conclude that the trial court erred in awarding Dr. Kaye attorney fees under the
statute, and therefore reverse the trial court’s judgment awarding attorney fees.
DECREE
Accordingly, for the foregoing reasons, we affirm the trial court’s December
18, 2018 judgment denying the Firm’s motion for partial summary judgment. We
further reverse the award of attorney fees in the February 21, 2019 judgment, amend
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the judgment to delete the award of attorney fees and as amended, affirm the
February 21, 2019 judgment.
DECEMBER 18, 2018 JUDGMENT AFFIRMED;
FEBRUARY 21, 2019 JUDGMENT REVERSED IN
PART, JUDGMENT AMENDED AND AFFIRMED
AS AMENDED
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SUSAN M. CHEHARDY CURTIS B. PURSELL
CHIEF JUDGE CLERK OF COURT
MARY E. LEGNON
FREDERICKA H. WICKER
CHIEF DEPUTY CLERK
JUDE G. GRAVOIS
MARC E. JOHNSON
ROBERT A. CHAISSON SUSAN BUCHHOLZ
STEPHEN J. WINDHORST
FIRST DEPUTY CLERK
HANS J. LILJEBERG
JOHN J. MOLAISON, JR. FIFTH CIRCUIT
MELISSA C. LEDET
JUDGES 101 DERBIGNY STREET (70053)
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GRETNA, LOUISIANA 70054 (504) 376-1400
(504) 376-1498 FAX
www.fifthcircuit.org
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DECEMBER 30, 2019 TO THE TRIAL JUDGE, CLERK OF COURT, COUNSEL OF RECORD AND ALL PARTIES
NOT REPRESENTED BY COUNSEL, AS LISTED BELOW:
19-CA-194
E-NOTIFIED
FIRST PARISH COURT (CLERK)
PAUL A. LEA, JR. (APPELLEE) STEVEN M. MAUTERER (APPELLANT)
MAILED
HONORABLE THOMAS F. GARDNER SHAYNA BEEVERS MORVANT
(JUDGE AD HOC) (APPELLANT)
FIRST PARISH COURT ATTORNEY AT LAW
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