Brannon v. Persons ( 2018 )

[Cite as Brannon v. Persons, 2018-Ohio-114.]
IN THE COURT OF APPEALS OF OHIO
SECOND APPELLATE DISTRICT
MONTGOMERY COUNTY
DWIGHT D. BRANNON, et al. :
:
Plaintiffs-Appellees : Appellate Case No. 27444
:
v. : Trial Court Case Nos. 2015-CV-1473
: and 2015-CV-3889
DONNA K. PERSONS, et al. :
: (Civil Appeal from
Defendants-Appellants : Common Pleas Court)
:
...........
OPINION
Rendered on the 12th day of January, 2018.
...........
DWIGHT D. BRANNON, Atty. Reg. No. 0021657, MATTHEW C. SCHULTZ, Atty. Reg.
No. 0080142, 130 West Second Street, Suite 900, Dayton, Ohio 45402
Attorneys for Plaintiffs-Appellees
DONNA K. PERSONS, 2939 Tubman Avenue, Dayton, Ohio 45417
Defendant-Appellant-Pro Se
.............
WELBAUM, J.
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{¶ 1} In this case, Defendant-Appellant, Donna Persons, appeals pro se from a
summary judgment rendered on behalf of Plaintiffs-Appellees, Dwight Brannon and
Matthew Schultz (collectively, “Appellees”). Persons contends that the trial court erred
in finding that she breached a contingent fee contract with Appellees, and in awarding
Appellees an amount equal to their contingency fee.
{¶ 2} We conclude that the trial court did not err in rendering summary judgment
in favor of Appellees on their claim for attorney fees, as Appellant failed to submit any
evidence that created a genuine issue of material fact regarding the reasonableness of
the fees. Further, assuming for the sake of argument that the action was more properly
based on quantum meruit than breach of contract, no prejudice occurred. Appellees also
asked the court for equitable relief, and Appellant failed to provide the court with any
evidence to challenge the fees that were requested. Appellant was entitled under the
law to discharge her attorneys, but she was not entitled to breach the settlement
agreement in an attempt to recover more money than the sum to which she had agreed
during mediation. Finally, Appellant failed to submit any evidence indicating that
Appellees committed legal malpractice. Accordingly, the judgment of the trial court will
be affirmed.
I. Facts and Course of Proceedings
{¶ 3} This action involves two trial court cases that were consolidated. Appellees
are attorneys who handled a medical malpractice action for Persons. In March 2015,
Appellees filed a complaint against Persons, alleging that she had breached a
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contingency fee contract by refusing to sign a release, by attempting to renegotiate a
settlement, and by discharging Appellees as counsel after they had completed their
representation. Appellees also included the following defendants in the lawsuit – Leslie
Cowden, fiduciary of the estate of John Cowden, D.P.M., Central Foot and Ankle Center,
and Foot and Ankle Specialists (collectively, “Cowden”) – and asked for an injunction
ordering these parties to place the settlement funds in escrow. In addition, Appellees
requested a declaratory judgment that they were entitled to enforce the settlement
agreement as third-party beneficiaries. Finally, Appellees asserted a bad faith claim
against Persons, contending that she had acted in bad faith.
{¶ 4} According to the complaint, Persons had signed a contingency fee
agreement with Appellees on December 29, 2010. Pursuant to the agreement,
Appellees filed a medical malpractice action on Persons’ behalf in February 2012. The
case was filed against Cowden, and was docketed as Montgomery County Common
Pleas Court Case No. 2012-CV-1126.
{¶ 5} A copy of the fee agreement was attached to the complaint as Ex. 1. The
complaint alleged that Cowden and Persons had reached agreement during a mediation
in September 2014, and that Persons had signed the settlement agreement. A copy of
the settlement agreement, with the amount redacted, was attached as Ex. 2. According
to Appellees, Persons failed to perform as required by the settlement agreement, and
subsequently discharged Appellees as counsel.
{¶ 6} In April 2015, Cowden filed an answer and cross-claim against Persons. In
the cross-claim, Cowden admitted that a settlement had been reached, and asked the
court to order Persons to perform under the settlement contract. Persons filed a pro se
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answer in April 2015, asking the court to strike the complaint on various grounds.
Persons also asked for “relief from judgment” pursuant to Civ.R. 60(B), although no
judgment was pending against her.
{¶ 7} On April 30, 2015, Appellees filed a motion for partial summary judgment on
their claims for breach of contract and injunctive relief. The motion was supported by the
affidavit of Schultz, who identified the contingency fee contract and the written settlement
agreement that Persons had signed on September 11, 2014. Schultz also outlined what
had occurred concerning settlement of the medical malpractice case.
{¶ 8} The contingency fee agreement provided that Appellees would receive a
percentage of the gross recovery before suit costs, other appropriate expenses, setoffs,
and subrogation. The fee percentage was based on the state at which recovery was
received. For example, prior to suit being filed, Appellees’ fee would be 40% of the gross
recovery; after suit was filed, the percentage would be 45%. Schultz Affidavit, Ex. 1, p.
1. Persons also agreed to pay costs, including Appellees’ personal and travel expenses,
as well as expenses like expert fees.
{¶ 9} A mediation had occurred in the medical malpractice case on September 11,
2014, and resulted in an agreement to settle the case. The settlement agreement was
dated the same day, and was signed by Persons, who agreed to settle her pending case
against Cowden for a specific amount (redacted) within thirty days. Persons also agreed
to satisfy any liens related to her claims, and to pay one-half the mediation costs.
{¶ 10} On April 30, 2015, Cowden filed a motion for judgment on the pleadings in
connection with the cross-claim against Persons. This was based on the fact that
Persons’ response to the cross-claim was unintelligible, and the fact that Persons did not
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dispute having signed the settlement agreement.
{¶ 11} Persons responded to Appellees’ summary judgment motion on May 20,
2015, but did not attach any affidavits. She did file some type of transcript of
conversations with her attorneys that allegedly took place in October 2014, after the
settlement agreement was signed.
{¶ 12} Further responses from both Persons and Appellees regarding the
summary judgment motion were filed in June 2015. In addition, Persons filed an affidavit
on June 16, 2015, which basically stated that she was not satisfied with the amount of the
settlement to which she had agreed.
{¶ 13} On June 18, 2015, the trial judge asked to be disqualified based on his
professional acquaintance with Appellees. The Supreme Court of Ohio then assigned a
visiting judge to the case in September 2015.
{¶ 14} In July 2015, Persons filed a separate action against Appellees, alleging
breach of contract, legal malpractice, breach of fiduciary duty, fraudulent
misrepresentation, and fraud. This case was docketed as Montgomery County Common
Pleas Court Case No. 2015-CV-03889, and was assigned to the same judge who was
hearing the fee dispute case. In April 2016, Appellees filed a motion for partial summary
judgment on these claims, which Appellees contended were claims for legal malpractice.
The summary judgment motion was supported by the affidavits of several attorneys, who
stated that Appellees had complied with pertinent standards of care.
{¶ 15} In the meantime, on October 29, 2015, Appellees renewed their motion for
partial summary judgment in the fee dispute case, and attached the affidavits of Matthew
Schultz and Arthur Phelps (counsel for Cowden). Among other things, the affidavits and
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documents indicated that Persons had signed a full and final release of her claims against
Cowden. According to Phelps, Persons had signed the release on October 2, 2015.
{¶ 16} In February 2016, Cowden also filed a motion for summary judgment,
arguing that no genuine issues of material fact existed concerning whether an enforceable
settlement existed. Cowden further asked the court to allow Cowden to deposit the
settlement proceeds in escrow and to dismiss Cowden from the action. Cowden’s
motion was supported by the affidavit of Arthur Phelps, who attached Persons’ October
2, 2015 release of all claims against Cowden.
{¶ 17} The trial court granted Cowden’s summary judgment motion in April 2016,
and ordered Cowden to deposit the settlement proceeds in an escrow account with the
Montgomery County Clerk of Courts. In addition, the court dismissed Cowden from the
action. Subsequently, on May 2, 2016, the trial court concluded that summary judgment
should be rendered in Appellees’ favor on their fee claim as well as on Persons’
malpractice claim. The court then set a hearing for July 26, 2016, to consider disposition
of the funds deposited with the clerk.
{¶ 18} On June 21, 2016, Persons filed a notice of appeal from the May 2, 2016
summary judgment decision. However, we dismissed the appeal for lack of a final
appealable order on November 1, 2016. See Brannon v. Persons, 2d Dist. Montgomery
No. 27151 (Nov. 1, 2016).
{¶ 19} While the case was on appeal, the trial court filed a judgment entry awarding
Appellees the sum of $87,750, which was 45% of the total settlement amount, consistent
with the fee agreement between Appellees and Persons. The court also awarded
judgment to Appellees on all claims asserted by Persons in Case No. 2015-CV-3889. In
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addition, the court awarded Appellees $2,588.61 in costs and $4,399.52 in prejudgment
interest from November 24, 2014, up to the time of the hearing held on July 26, 2016.
{¶ 20} At that time, the court overruled Appellees’ motion for attorney fees incurred
in both pending cases, because their claim for bad faith remained pending. The
judgment, which was filed on August 25, 2016, was accompanied by a Civ.R. 54(B)
certification. Persons filed a notice of appeal from this judgment on September 14, 2016.
We dismissed the appeal, however, finding that the trial court lacked jurisdiction to enter
an order while the appeal was pending. See Brannon v. Persons, 2d Dist. Montgomery
No. 27266 (Dec. 20, 2016).
{¶ 21} Subsequently, on January 17, 2017, the trial court entered another
judgment, which awarded Appellees the same amounts for attorney fees, costs, and
prejudgment interest. The court, thus, ordered a total of $95,044.13 to be distributed to
Appellees, and $76,539.20 to be distributed to Persons. However, the court also ordered
that $23,416.67 of Person’s award would be retained in escrow, pending the court’s
resolution of Appellees’ claims for bad faith and attorney fees.
{¶ 22} The January 2017 decision incorporated the May 2, 2016 summary
judgment order, and the court also included a Civ.R. 54(B) certification with the judgment.
Persons then filed a notice of appeal on February 7, 2017, and her appeal was docketed
as Appeal No. 27444 (the current case).
{¶ 23} On March 15, 2017, Appellees filed a motion to dismiss the current appeal,
based on the fact that the Clerk of Courts paid Appellees the judgment of $95,044.13 on
January 19, 2017. Appellees contended that the appeal, therefore, was moot.
{¶ 24} We filed a decision and entry on July 5, 2017, overruling the motion to
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dismiss. We noted that while we were overruling the motion at that time, Appellees could
make arguments about mootness in their brief, and the issue would be decided when the
case was submitted to a merit panel. See Brannon v. Persons, 2d Dist. Montgomery No.
27444 (July 5, 2017). Both sides have filed their briefs, and the matter is ready for
disposition. Appellees have reasserted their claim of mootness in their brief, and we will
consider that matter first, as it could dispose of the appeal.
II. Whether the Appeal is Moot
{¶ 25} According to Appellees, the appeal is moot because Persons failed to obtain
a stay of execution, and the judgment against her was satisfied by the payment to
Appellees on January 19, 2017. Persons did not file a reply brief, and has not responded
to this argument.
{¶ 26} Requirements for a stay of execution are contained in R.C. 2505.09, which
provides that “an appeal does not operate as a stay of execution until a stay of execution
has been obtained pursuant to the Rules of Appellate Procedure or in another applicable
manner, and a supersedeas bond is executed by the appellant to the appellee, with
sufficient sureties and in a sum that is not less than, if applicable, the cumulative total for
all claims covered by the final order, judgment, or decree and interest involved * * *.”
{¶ 27} App.R. 7(A) provides that, ordinarily, applications for a stay of execution
must first be made in the trial court. This rule further states that “[a] motion for such relief
* * * may be made to the court of appeals or to a judge thereof, but, except in cases of
injunction pending appeal, the motion shall show that application to the trial court for the
relief sought is not practicable, or that the trial court has, by journal entry, denied an
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application or failed to afford the relief which the applicant requested.” Persons did not
apparently take any of these actions to stay the trial court’s judgment; at a minimum, our
docket does not reveal an application for a stay.
{¶ 28} In Blodgett v. Blodgett, 49 Ohio St. 3d 243, 551 N.E.2d 1249 (1990), the
Supreme Court of Ohio held that:
It is a well-established principle of law that a satisfaction of judgment
renders an appeal from that judgment moot. “ ‘Where the court rendering
judgment has jurisdiction of the subject-matter of the action and of the
parties, and fraud has not intervened, and the judgment is voluntarily paid
and satisfied, such payment puts an end to the controversy, and takes away
from the defendant the right to appeal or prosecute error or even to move
for vacation of judgment.’ ”
Id. at 245, quoting Rauch v. Noble, 169 Ohio St. 314, 316, 159 N.E.2d 451 (1959).
(Other citation omitted.)
{¶ 29} In Blodgett, the appellant argued that her appeal should not be terminated
because she had signed a satisfaction of the lower court judgment and had taken its
benefits due to economic duress. Id. The Supreme Court of Ohio was not persuaded,
declining “to accept the proposition that if an appellant executes a satisfaction of judgment
merely because she cannot afford to wait for the outcome of an appeal, that satisfaction
of judgment may be subsequently avoided.” Id. at 246.
{¶ 30} We subsequently distinguished Blodgett because our case (a foreclosure
case where the property had been sold) did not “involve a contract or agreement that a
judgment has been satisfied or settled.” Chase Manhattan Mtg. Corp. v. Locker, 2d Dist.
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Montgomery No. 19904, 2003-Ohio-6665, ¶ 41. See also Janis v. Janis, 2d Dist.
Montgomery No. 23898, 2011-Ohio-3731, ¶ 28 (noting that “Blodgett does not stand for
the proposition that any payment toward the satisfaction of a judgment while an appeal is
pending renders moot the appeal or any specific issue therein. [Appellee] has cited no
authority for her suggestion that certain aspects of an appeal can be rendered moot by
the actions of the parties without an agreement to that effect and without payment in full.”)
{¶ 31} In KeyBank Natl. Assn. v. Mazer Corp., 188 Ohio App. 3d 278, 2010-Ohio-
1508, 935 N.E.2d 428 (2d Dist.), we also refused to find an appeal moot because
ownership of or interest in property being disputed (several hundred thousand pounds of
paper) had been sold and the proceeds had been placed in escrow pending appeal. Id.
at ¶ 53. Notably, we said that “[t]he statements of the parties indicate that these matters
occurred after the judgment that is on appeal, and they are not properly before us.” Id.
{¶ 32} We further observed in KeyBank that “[t]he right to appeal is not conditioned
upon obtaining a stay of the judgment from which the appeal is taken. A party who
cannot afford the requisite supersedeas bond, or who is otherwise unable to obtain a stay
of the offending judgment – perhaps * * * because the party loses the race between the
appellant's attempt to obtain a stay and the appellee's attempt to reduce its judgment to
money, does not thereby lose the right to appeal. A voluntary satisfaction of a judgment
waives any appeal from that judgment.” (Emphasis sic.; citations omitted.) Id. at ¶ 54.
{¶ 33} In the case before us, the payment in question apparently occurred after
judgment was rendered, and is not properly before us. Furthermore, even if this were
otherwise, there is no indication that Persons signed any type of agreement that the
judgment had been satisfied. The money had also been placed in escrow. Based on
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the above authority, we conclude that the appeal is not moot.
III. Right to Terminate Fee Agreement
{¶ 34} Because the First and Second Assignments of Error are interrelated, we will
consider them together. Persons’ First Assignment of Error states that:
The Trail [sic] Court Erred in Finding that Appellant Donna Persons
Breach [sic] the Contingency Fee Contract Agreement and Finding that
Appellant Persons Was Held Binding to the Contingency Fee Contract
Based on Hear Say [sic] With Regard to Appellant Had Received Advice
that the Settlement Was a “Bad Deal” from “Insurance Expert” Robert
McComb, as Lower Court Ruled on May 2, 2016.
{¶ 35} The Second Assignment of Error states that:
The Trail [sic] Court Erred in Granting Summary Judgment in the Full
45% Amount of the Contingency Fee Agreement to Dwight D. Brannon &
Associates for Breach of Contract against Appellant Donna Persons under
the Contingency Fee Agree [sic] in Case’s [sic] 2015 CV 01473.
{¶ 36} As was noted, Persons’ pro se brief is basically unintelligible. Under these
assignments of error, Persons appears to contend that the trial court based its grant of
summary judgment on an improper assumption that Persons received bad advice from a
third party, and that she had a right to terminate the fee contract when Appellees refused
to pursue all damages to which she was entitled, including future surgeries.
{¶ 37} “A trial court may grant a moving party summary judgment pursuant to Civ.
R. 56 if there are no genuine issues of material fact remaining to be litigated, the moving
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party is entitled to judgment as a matter of law, and reasonable minds can come to only
one conclusion, and that conclusion is adverse to the nonmoving party, who is entitled to
have the evidence construed most strongly in his favor.” Smith v. Five Rivers
MetroParks, 134 Ohio App. 3d 754, 760, 732 N.E.2d 422 (2d Dist. 1999), citing Harless v.
Willis Day Warehousing Co., 54 Ohio St. 2d 64, 375 N.E.2d 46 (1978). “We review
decisions granting summary judgment de novo, which means that we apply the same
standards as the trial court.” (Citations omitted.) GNFH, Inc. v. W. Am. Ins. Co., 172
Ohio App. 3d 127, 2007-Ohio-2722, 873 N.E.2d 345, ¶ 16 (2d Dist.).
{¶ 38} In its order on the pending motions for summary judgment, the trial court
noted the factual background of the action. During its discussion, the court commented
on items that had been attached to Appellees’ motion for summary judgment on the fee
issue, and on items attached to Persons’ reply to the motion. The court stated that of
the various materials Persons had attached, only two had been properly submitted under
Civ.R. 56(E). These were requests for admissions and an affidavit of Mr. McCombs.
The court concluded that McCombs’ affidavit was inadmissible as hearsay, and was
additionally irrelevant to any issues in the contract case.
{¶ 39} Concerning the fee claim, the court concluded that Persons signed a final
settlement and release of claims against Cowden on October 2, 2015, and that this
seemingly mooted her claims regarding the settlement agreement. The court then stated
that even if any fraud or misrepresentation claims survived, there was no evidence of
such. The court further commented that Mr. McCombs convinced Persons after the
mediation that she had made a “bad deal” and should get out of it. After making this
observation, the court stated that there were no genuine issues of material fact, and that
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the settlement agreement and contingent fee agreement were binding on Persons.
{¶ 40} The Supreme Court of Ohio has held that “[w]hen an attorney is discharged
by a client with or without just cause, and whether the contract between the attorney and
client is express or implied, the attorney is entitled to recover the reasonable value of
services rendered the client prior to discharge on the basis of quantum meruit.” Fox &
Assoc. Co., L.P.A. v. Purdon, 44 Ohio St. 3d 69, 541 N.E.2d 448 (1989), syllabus. The
court further held that the maximum reach of a law firm’s right to fees “is the reasonable
value of the legal services actually rendered to the date of discharge.” Id. at 72.
{¶ 41} “One of the central tenets of the Fox approach is that a client has an
absolute right to discharge an attorney or law firm at any time, with or without cause,
subject to the obligation to compensate the attorney or firm for services rendered prior to
the discharge. * * * Once discharged, the attorney must withdraw from the case, and can
no longer recover on the contingent-fee-representation agreement. The discharged
attorney may then pursue a recovery on the basis of quantum meruit for the reasonable
value of services rendered up to the time of discharge.” (Citations omitted.) Reid,
Johnson, Downes, Andrachik & Webster v. Lansberry, 68 Ohio St. 3d 570, 574, 629
N.E.2d 431 (1994).
{¶ 42} Furthermore, “when an attorney representing a client pursuant to a
contingent-fee agreement is discharged, the attorney's cause of action for a fee recovery
on the basis of quantum meruit arises upon the successful occurrence of the
contingency.” Reid at 575. In addition, “the quantum meruit recovery of a discharged
attorney should be limited to the amount provided for in the disavowed contingent fee
agreement.” (Citation omitted.). Id. at 576. The totality of circumstances is to be
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considered in determining the fee, including the number of hours an attorney worked
before discharge, “the skill demanded, the results obtained, and the attorney-client
relationship itself.” (Citation omitted.) Id. For aid in analysis, the court also suggested
former DR 2-106(B) of the Code of Professional Responsibility, which provided guidelines
concerning reasonableness of attorney fees. Id. at 576 and fn.3.
{¶ 43} The factors listed in this section of the Code included:
“(1) The time and labor required, the novelty and difficulty of the
questions involved, and the skill requisite to perform the legal service
properly.
(2) The likelihood, if apparent to the client, that the acceptance of the
particular employment will preclude other employment by the lawyer.
(3) The fee customarily charged in the locality for similar legal
services.
(4) The amount involved and the results obtained.
(5) The time limitations imposed by the client or by the
circumstances.
(6) The nature and length of the professional relationship with the
client.
(7) The experience, reputation, and ability of the lawyer or lawyers
performing the services.
(8) Whether the fee is fixed or contingent.”
Reid, 68 Ohio St. 3d at 576, fn.3, 629 N.E.2d 431, quoting DR 2-106(B).1
1 Guidelines pertaining to fees and expenses are now found in Prof.Cond.R. 1.5, and
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{¶ 44} The trial court did not consider the above factors specifically, but concluded
that Persons failed to submit any evidence to support her claims. The issue, therefore,
is whether the court’s failure to specifically discuss the factors was prejudicial error. We
conclude that the error, if any, was not prejudicial. See Civ.R. 61 (“The court at every
stage of the proceeding must disregard any error or defect in the proceeding which does
not affect the substantial rights of the parties.”). See also Fada v. Information Sys. &
Networks Corp., 98 Ohio App. 3d 785, 792, 649 N.E.2d 904 (2d Dist.1994) (“errors ‘will
not be deemed prejudicial where their avoidance would not have changed the result of
the proceedings.’ ”) (Citations omitted.) The critical point here is that Persons submitted
absolutely no evidence indicating that the requested fees were unreasonable.
{¶ 45} In affidavits filed with the trial court, Appellees did not specifically state the
number of hours they had worked prior to discharge, but they did note that they had filed
the case in February 2012, and had conducted discovery and readied the case for trial.
The affidavits indicate that a mediation occurred in September 2014, eleven days before
the case was scheduled to go to trial. At that point, more than two years had elapsed
since the case was filed, and nearly four years had elapsed since Persons initially retained
Appellees. The affidavits further indicate that Brannon, who had decades of experience
in medical malpractice litigation, supervised Schultz's work, and the two spoke about the
case regularly, discussing its progress and issues that arose, including difficulties taking
the deposition of the defendant doctor, who eventually died in August 2014, during the
pendency of the case. Appellees further indicated that they had worked hard preparing
the factors are unchanged from those quoted in Reid.
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the case for trial and had negotiated a very advantageous settlement for Persons.
Furthermore, after the mediation hearing, Appellees negotiated with Persons' subrogated
insurance carrier and were able to reduce the carrier's claims to approximately 45% of its
original lien on the settlement proceeds.
{¶ 46} Appellees obtained a successful occurrence of the contingency, as a
settlement agreement was signed by Cowden and Persons at the mediation hearing in
September 2014. Appellees also submitted the affidavit of Sam Caras, who had
practiced law since 1980, and whose practice consisted, in significant part, of
representing plaintiffs in medical malpractice cases. Caras indicated he had reviewed
several documents from the medical malpractice case and had found no instance where
Appellees deviated from the standard of care in connection with their representation of
Persons.
{¶ 47} According to Caras, it was not unreasonable or below the standard of care
for Appellees to charge a 45% contingency fee. Caras stated that: “Medical malpractice
cases are extremely difficult to pursue successfully, and require specific, specialized
skills. Podiatric malpractice cases are especially difficult to pursue, largely due to the
difficulty of obtaining an expert witness to testify as to the violation of the standard of
care.” March 24, 2016 Affidavit of Sam Caras, p. 2. Additionally, Caras stated that:
Given the total medical bills of approximately $130,000.00, and
actual medical bills paid in the amount of approximately $46,000.00, and
given the nature of the claim, the difficulty of pursuing a medical malpractice
claim in general, and a podiatric medical malpractice claim in particular, the
settlement reached at mediation, for $195,000.00, is reasonable. Advising
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Ms. Persons to accept such a settlement is not below the standard of care.
The reasonableness of this settlement amount is not dependent on
whether Ms. Persons needed a further corrective surgery. Even if Ms.
Persons needed further surgery, an allegation that is not at all clear from
her deposition taken less than two months before the mediation, it was not
below the standard of care of Mr. Brannon and Mr. Schultz to advise Ms.
Persons to accept the $195,000 settlement offer.
Caras Affidavit at pp. 2-3.
{¶ 48} Appellees also submitted the affidavit of another attorney, Julius Carter,
who made similar observations about the reasonableness of the contingency fee and the
difficulty of pursuing medical malpractice cases. See April 7, 2016 Affidavit of Julius
Carter.
{¶ 49} Persons failed to present any admissible evidence challenging the above
statements, nor did she present any evidence indicating that Appellees’ requested fees
were unreasonable under the circumstances. What the evidence indicated is that
Persons agreed to settle her case for $195,000 during mediation, and signed a written
agreement to that effect. She also filed an affidavit in the current action, stating that she
had informed Appellees before the mediation that she would need two more corrective
surgeries on her foot. See April 19, 2016 Second Affidavit of Donna Persons, p. 2. In
addition, Persons stated in the affidavit that she was told during the mediation
proceedings that “all damages” were included in the $195,000 figure, and agreed with the
settlement at that point. Id. Both the contingency fee agreement and the settlement
agreement informed Persons that she would be required to pay any subrogation
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expenses or liens related to her claims.
{¶ 50} After signing the settlement agreement, Persons apparently became
dissatisfied with the amount she was going to receive. A few days after the mediation,
Persons appeared at Appellees’ office with a self-described “insurance expert,” Robert
McComb. McComb was not an attorney. Persons then appeared again at Appellees’
office in October 2014, this time with McComb and her sons. At the latter meeting,
Persons expressed unhappiness with the subrogation amount (which had been reduced
considerably), and asserted (incorrectly) that the settlement amount did not cover future
surgeries that she would need. Persons, therefore, wanted to re-negotiate both the
settlement amount and the fee agreement.
{¶ 51} Appellees refused, and submitted the fee dispute to the Dayton Bar
Association’s Attorney Fee Dispute Arbitration Program on October 21, 2014. However,
Persons refused to participate in that process. Consequently, Appellees filed a motion
to reactivate Person’s medical malpractice case, and Cowden filed a motion in that action
on November 17, 2014, asking the court to enforce the settlement. Subsequently, on
November 20, 2014, Persons informed Appellees that she no longer wished them to
represent her. Appellees then filed a motion to withdraw as counsel on December 1,
2014, and their motion to withdraw was granted on December 26, 2014.
{¶ 52} Appellees filed a motion to intervene in the pending medical malpractice
action, but before the court could rule on their motion to intervene or on Cowden’s motion
to enforce the settlement, Persons filed a Civ.R. 41(A) dismissal of her medical
malpractice action. Appellees then filed the current action in March 2015, asking for
enforcement of the fee agreement, for equitable relief in the form of an injunction, and for
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a declaratory judgment.
{¶ 53} As was noted, at no point has Persons submitted any Civ.R. 56 evidence
that challenges the reasonableness of the fee awarded. “While a nonmoving party has
no burden of proof in opposing a motion for summary judgment, when presented with a
motion for summary judgment properly supported showing no issue of fact exists and that
the moving party is entitled to judgment as a matter of law, the nonmoving party does
have a burden to supply evidentiary materials to support his position that a genuine issue
of fact exists.” Beard v. Mayfield, 73 Ohio App. 3d 173, 176-77, 596 N.E.2d 1056 (10th
Dist.1991), citing Mathis v. Cleveland Pub. Library, 9 Ohio St. 3d 199, 459 N.E.2d 877
(1984). Accord Dresher v. Burt, 75 Ohio St. 3d 280, 293, 662 N.E.2d 264 (1996);
Deutsche Bank Natl. Tr. Co. v. Holden, 147 Ohio St. 3d 85, 2016-Ohio-4603, 60 N.E.3d
1243, ¶ 34.
{¶ 54} Accordingly, because Persons failed to meet her burden under Civ.R. 56(E),
any error in the trial court’s analysis was harmless. Appellees presented evidence that
the contingency in the fee contract successfully occurred. Specifically, Appellees
obtained a settlement, and Persons signed a release of her claims against Cowden on
October 2, 2015, in exchange for the amount of the settlement that Appellees had
negotiated. The fee awarded was also not more than the amount established in the
contingency fee contract. Reid, 68 Ohio St. 3d at 576, 629 N.E.2d 431. Furthermore,
the undisputed evidence that Appellees submitted revealed that the fee was reasonable
under the totality of the circumstances.
{¶ 55} “The factors a court considers to determine the reasonableness of a
discharged attorney's fees under a quantum meruit claim, in addition to the ultimate
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amount of quantum meruit recovery by the discharged attorney, are matters to be
resolved by the trial court within the exercise of its discretion.” (Citations omitted.)
Doellman v. MidFirst Credit Union, Inc., 12th Dist. Warren No. CA2006-06-074, 2007-
Ohio-5902, ¶ 17. An abuse of discretion “means we will affirm unless we find the trial
court's attitude ‘unreasonable, arbitrary or unconscionable.’ ” Schafer v. RMS Realty,
138 Ohio App. 3d 244, 300, 741 N.E.2d 155 (2d Dist.2000), quoting AAAA Enterprises,
Inc. v. River Place Community Urban Redevelopment Corp., 50 Ohio St. 3d 157, 161, 553
N.E.2d 597 (1990). “Decisions are unreasonable if they are not supported by a sound
reasoning process.” Id. We see no evidence that the trial court’s decision was
unsupported by sound reasoning.
{¶ 56} As a final matter, we note that the trial court held a hearing on July 26, 2016,
regarding the disposition of funds held by the Clerk of Courts. No transcript of the
hearing was filed, and we have no idea what occurred at the hearing. “Without a
transcript, we must presume the validity of the trial court's proceedings, and [Appellant’s]
evidentiary arguments necessarily fail.” (Citations omitted.) Jenkins v. Pullins, 2d Dist.
Clark No. 2007-CA-14, 2008-Ohio-6727, ¶ 18.
{¶ 57} Based on the preceding discussion, we find no error in the grant of summary
judgment or abuse of discretion in the trial court’s award of fees to Appellees. Persons’
First and Second Assignments of Error, therefore, are overruled.
IV. Breach of Contract
{¶ 58} Persons’ Third Assignment of Error states that:
The Trial Court Erred by Granting Summary Judgment to Dwight D.
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Brannon & Associates/Matthew Schultz in Case Number 2015 CV 01473,
for Breach of Contract Under the Contingency Fee Agreement Against
Appellant Donna Persons.
{¶ 59} Under this assignment of error, Persons contends that Appellees had no
cause of action for breach of contract under the fee agreement; instead, their only
recovery was under a theory of quantum meruit, which they failed to plead. Also
mentioned in the discussion of this assignment of error is that Appellees were terminated
for “just cause” because they were negligent and breached the fee agreement.
{¶ 60} Persons’ response to the complaint was a rambling 29-page document that
was docketed as an “Answer.” It was not titled as an answer; instead, Persons asked
the court to strike and dismiss the complaint on various grounds, including lack of standing
and lack of personal and subject matter jurisdiction. Persons did raise, at page 26, the
fact that Appellees’ remedy was under “quantum merits” [sic] and that the court should
dismiss the complaint for breach of contract and other remedies. Appellees filed a
response on April 30, 2015, asking the court to strike all or part of Persons’ response to
the complaint.
{¶ 61} On September 30, 2015, Persons filed another motion to dismiss, arguing
that the contract became “void” on her termination of the contract. Appellees responded
to this motion on October 14, 2015, noting that both of Persons’ motions to dismiss
referenced matters not in the complaint. In addition, Appellees noted that the Ohio cases
that Persons cited, which dealt with fee disputes, simply discussed the type of relief
afforded, not whether a claim had been stated. On May 2, 2016, the trial court granted
the motions for summary judgment that Appellees had filed with respect to the fees and
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malpractice claims. Two days later, the court overruled Persons’ motion to dismiss.
{¶ 62} As was noted, Persons filed a notice of appeal from these summary
judgment decisions, but we dismissed her appeal for lack of a final appealable order.
See Brannon v. Persons, 2d Dist. Montgomery No. 27151 (Nov. 1, 2016). After the case
was remanded to the trial court, Persons never actually filed an answer to the complaint.
She had also not previously filed an answer after the trial court denied her motion to
dismiss. Following remand, the trial court issued another order granting summary
judgment in Appellees’ favor on January 17, 2017, and included a Civ.R. 54(B)
certification.
{¶ 63} Civ.R. 12(A)(2) requires answers to be served within fourteen days after the
court denies a motion to dismiss. Failure to deny an averment in a pleading has been
held to be an admission of the averment. See, e.g., Am. Savs. Bank v. Wrage, 4th Dist.
Scioto No. 13CA3566, 2014-Ohio-2168, ¶ 19; U.S. Bank, N.A. v. Goldsmith, 10th Dist.
Franklin No. 14AP-783, 2015-Ohio-3008, ¶ 9. In Goldsmith, the court commented that
“[a]lthough Civ.R. 8(D) does not differentiate between allegations of fact and legal
conclusions, judicial admissions, by definition, can only admit the truth of allegations of
fact.” (Citations omitted.) Id. Under this theory, one could assume that Persons,
therefore, admitted the truth of the factual allegations in the complaint, but could
potentially assert a legal argument.
{¶ 64} Assuming that Persons’ “legal” argument is properly before us, we find no
reversible error. We noted earlier that the Supreme Court of Ohio held in Fox that
“[w]hen an attorney is discharged by a client with or without just cause, and whether the
contract between the attorney and client is express or implied, the attorney is entitled to
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recover the reasonable value of services rendered the client prior to discharge on the
basis of quantum meruit.” Fox, 44 Ohio St. 3d 69, 541 N.E.2d 448, at syllabus.
{¶ 65} In Fox, the defendant entered into a written contingency fee agreement with
Fox & Associates for the filing of a personal injury claim. Id. at 70. The attorney
(Michael Ellerbrock), who handled defendant’s case at Fox, left the firm before the case
was settled. As a result, the defendant discharged the law firm. The afternoon of the
discharge, Ellerbrock advised the defendant that the insurance company had increased
its offer, and she accepted. Id. When Ellerbrock received the settlement money, he
retained the agreed-upon one-third fee and costs, and gave defendant the rest of the
money. Id. At that point, the law firm sued the defendant, seeking the full one-third
contingency fee. Id. The trial court concluded that defendant had breached the contract
by discharging the law firm without just cause, and awarded the firm the approximate
amount of the one-third contingency fee. Id.
{¶ 66} Before Fox was decided, the rule had been that where an express
contingency fee contract existed and the client breaches without just cause, “ ‘the
measure of damages in such case is not limited to the reasonable value of the services
rendered by the lawyers employed prior to the cancellation of the contract,’ but rather
damages should be for the full contract price.” Id. at 71, quoting Roberts v. Montgomery,
115 Ohio St. 502, 154 N.E. 740 (1926), paragraph two of the syllabus. In this situation,
full payment would be required “even if the attorney has not yet rendered services.” Id.,
citing Scheinesohn v. Lemonek, 84 Ohio St. 424, 95 N.E. 913 (1911).
{¶ 67} The court stressed that “[t]his rule is based on the premise that quantum
meruit should not be used as the measure for damages since the client has not been
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benefited by some service, and yet, the value of the attorney's anticipated services has
been fixed by agreement of the parties.” (Emphasis added.) Fox, 44 Ohio St. 3d at 71,
541 N.E.2d 448. An additional factor was the assumption of courts “that placing value
on attorney services is difficult since such services are not easily apportionable to the
time or the labor performed or to be performed in the future.” (Citation omitted.) Id.
Ultimately, the Supreme Court of Ohio decided to abandon this reasoning, due to “the
contemporary and regulated status of today's attorney-client relationship relative to fees.”
Id. As a result, the court overruled Scheinesohn and also overruled Roberts, “to the
extent that it distinguishes between recovery in cases where express contracts exist (full
price must be paid), and recovery on the basis of quantum meruit in the absence of an
express contract.” Id. at 72. The court, thus, decided that, in either situation, “the
attorney is entitled to recover the reasonable value of services rendered prior to the
discharge on the basis of quantum meruit.” Id.
{¶ 68} The court then reversed the case and remanded it to the trial court for a
decision on the reasonable value of the services rendered by the law firm. Id. The court
did not say that the action should be dismissed because it had been brought for breach
of contract, rather than under quantum meruit.
{¶ 69} Subsequently, the Supreme Court of Ohio stated that:
One of the central tenets of the Fox approach is that a client has an
absolute right to discharge an attorney or law firm at any time, with or
without cause, subject to the obligation to compensate the attorney or firm
for services rendered prior to the discharge. * * * Once discharged, the
attorney must withdraw from the case, and can no longer recover on the
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contingent-fee-representation agreement. The discharged attorney may
then pursue a recovery on the basis of quantum meruit for the reasonable
value of services rendered up to the time of discharge.
Reid, 68 Ohio St. 3d at 574, 629 N.E.2d 431.
{¶ 70} The case before us differs from many cases that we have reviewed, in that
it was completely resolved through settlement by one set of attorneys who are requesting
fees for their work. Many cases involve situations where an initial attorney or law firm
performed some work and the case was eventually resolved by another attorney or law
firm. See, e.g., Fox, 44 Ohio St. 3d at 70, 541 N.E.2d 448; In re J.F., 162 Ohio App. 3d
716, 2005-Ohio-4258, 834 N.E.2d 876, ¶ 3-5 (9th Dist.). Often, competing contingent
fee contracts are involved. See, e.g., Reid, 68 Ohio St. 3d at 571-572, 629 N.E.2d 431;
J.F. at ¶ 3-4.
{¶ 71} In September 2014, Persons signed a written settlement agreement, stating
that she would accept a sum certain for her claims. She discharged her counsel in
November 2014, and thereafter, did not retain further counsel. Persons then signed a
release of her claims in October 2015, after Appellees had filed their action. Thus, the
only real issue before the trial court was what compensation, if any, should be given to
Appellees for their work.
{¶ 72} In Randolph v. Howard, 1st Dist. Hamilton No. C-930274, 1994 WL 176908
(May 11, 1994), the appellant argued that the trial court had erred in awarding an attorney
fees based on a contract, when the reasonable value of his services should have been
determined based on quantum meruit. Id. at *2. The appellate court agreed, but
concluded that the “error was harmless because, in light of all the evidence, the award is
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consistent with reasonable value and substantial justice has been rendered.” (Citation
omitted.)
{¶ 73} In the case before us, Persons fails to indicate how she was prejudiced if
the action was incorrectly brought on a contract basis rather than in quantum meruit. As
was noted, Persons failed to present any admissible evidence challenging the
reasonableness of the attorney fees that Appellees claimed or establishing a genuine
issue of material fact as to the reasonableness of the fees under the totality of the
circumstances.
{¶ 74} We also note the decision in Harraman v. Howlett, 5th Dist. Morrow No.
03CA0023, 2004-Ohio-5566, in which the trial court imposed a constructive trust on
attorney fees received by a second group of attorneys who had settled a case. When
the second set of attorneys appealed, the court of appeals rejected their argument that
the trial court erred in imposing a constructive trust on their fees. The court of appeals
stressed that both quantum meruit and constructive trusts are equitable remedies, and
that a “constructive trust” could be imposed against “ ‘ “one * * * who in any way against
equity and good conscience either has obtained or holds the legal right to property which
he ought not, in equity and good conscience, hold and enjoy. It is raised by equity to
satisfy the demands of justice. * * * ” ’ ” (Emphasis sic.) Harraman at ¶ 38, quoting
Ferguson v. Owens, 9 Ohio St. 3d 223, 459 N.E.2d 1293 (1984), which in turn quotes 76
American Jurisprudence 2d, Trusts, Section 221 (1975).
{¶ 75} In Harraman, the court of appeals commented that when the successful
contingency occurred (the settlement), the original attorney’s cause of action for a
recovery based on quantum meruit arose; thus, the trial court correctly imposed a
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constructive trust because the second set of attorneys wrongfully held title to the fees,
even though no fraud had occurred. Id. at ¶ 31-43.
{¶ 76} Similarly, in the case before us, Appellees included Cowden, the current
holder of the settlement proceeds, as a defendant, and asserted a property right in the
proceeds that Cowden held. See Plaintiff’s Complaint, ¶s 36-41. Appellees also asked
the trial court for an injunction ordering the proceeds to be placed in escrow to protect
their right to a portion of the proceeds pending resolution of their claims. Id. at ¶ 41.
The trial court did order that the funds be placed in escrow pending a decision on
Appellees’ claim. Since this served the same equitable purpose as a claim for quantum
meruit, we fail to see how Persons was prejudiced.
{¶ 77} In Fox, the court stressed that the quantum meruit rule does not “create a
threat that the discharged attorney will not be compensated for services rendered before
discharge occurs. * * * An attorney who substantially performs under the contract may be
entitled to the full price of the contract in the event of discharge ‘on the courthouse steps,’
or just prior to settlement. * * * Similarly, it would be inequitable to force a client who has
received no service from the discharged attorney to pay the full price of the contract. Any
benefit received by the client through subsequently successful litigation or settlement may
have been the result of in propria persona representation or representation by new
counsel.” Fox, 44 Ohio St. 3d at 72, 541 N.E.2d 448.
{¶ 78} In the case before us, the discharge did not occur prior to settlement; it was
after settlement, and after the parties had entered into a written settlement agreement.
Persons also did not obtain new counsel who had a claim to any fees. Under the
circumstances, there is no basis for awarding something other than the full amount of the
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requested fees. Again, Persons failed to submit any evidence establishing a genuine
issue of material fact concerning the reasonableness of the fees. The fact that she
wanted to obtain more money than the amount to which she had agreed does not justify
a reduction of attorney fees. It is true that Persons had a right to discharge her attorneys,
but that does not mean she was entitled to more money as a result of her choices.
Accordingly, we find Persons’ argument without merit.
{¶ 79} The final issue is the summary judgment granted to Appellees on Persons’
claims for legal malpractice. As was noted, Persons’ brief is largely unintelligible, but
she does mention in passing that Appellees “breached” the contingency agreement when
they failed to pursue all the damages to which she was entitled, including the cost of future
surgeries.
{¶ 80} In rejecting Persons’ malpractice claim, the trial court noted that Appellees
had submitted several affidavits from legal experts indicating they did not fall below the
standard of care in representing Persons. The court further observed that Persons failed
to submit any evidence, by way of affidavit or otherwise, to indicate that Appellees fell
below the pertinent standards of care.
{¶ 81} “An action against one's attorney for damages resulting from the manner in
which the attorney represented the client constitutes an action for malpractice within the
meaning of R.C. 2305.11, regardless of whether predicated upon contract or tort or
whether for indemnification or for direct damages.” Muir v. Hadler Real Estate Mgt. Co.,
4 Ohio App. 3d 89, 89–90, 446 N.E.2d 820 (10th Dist.1982). “Malpractice by any other
name still constitutes malpractice.” Id. at 90. Accord Pierson v. Rion, 2d Dist.
Montgomery No. 23498, 2010-Ohio-1793, ¶ 13.
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{¶ 82} Consequently, despite how Persons may have phrased her complaint
against Appellees, her action is for legal malpractice. “To establish a cause of action for
legal malpractice based on negligent representation, a plaintiff must show (1) that the
attorney owed a duty or obligation to the plaintiff, (2) that there was a breach of that duty
or obligation and that the attorney failed to conform to the standard required by law, and
(3) that there is a causal connection between the conduct complained of and the resulting
damage or loss.” Vahila v. Hall, 77 Ohio St. 3d 421, 674 N.E.2d 1164 (1997), syllabus.
“The failure of a party asserting a legal malpractice claim to establish any one of the three
elements entitles the opposing party to summary judgment.” (Citation omitted.)
Lundeen v. Graff, 2015-Ohio-4462, 46 N.E.3d 236, ¶ 12 (10th Dist.)
{¶ 83} In Vahila, the court also stated that:
We are aware that the requirement of causation often dictates that the
merits of the malpractice action depend upon the merits of the underlying
case. Naturally, a plaintiff in a legal malpractice action may be required,
depending on the situation, to provide some evidence of the merits of the
underlying claim. * * * However, we cannot endorse a blanket proposition
that requires a plaintiff to prove, in every instance, that he or she would have
been successful in the underlying matter.
(Citations omitted.) Vahila at 427-428.
{¶ 84} Subsequently, the Supreme Court of Ohio clarified Vahila, commenting that
“[w]hen a plaintiff premises a legal-malpractice claim on the theory that he would have
received a better outcome if his attorney had tried the underlying matter to conclusion
rather than settled it, the plaintiff must establish that he would have prevailed in the
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underlying matter and that the outcome would have been better than the outcome
provided by the settlement.” Environmental Network Corp. v. Goodman Weiss Miller,
L.L.P., 119 Ohio St. 3d 209, 2008-Ohio-3833, 893 N.E.2d 173, syllabus.
{¶ 85} After reviewing this matter, we conclude that the trial court’s recitation of the
evidence and its conclusions about the lack of malpractice were correct. As a
preliminary matter, Persons’ claim was not precisely that she would have received more
money if she had gone to trial; her complaint, in essence, is that her settlement should
have included compensation for future surgeries. However, in an affidavit filed in the
current action, Persons stated that she had informed her counsel before the mediation
that she would need two more corrective surgeries on her foot. See April 19, 2016
Second Affidavit of Donna Persons, p. 2. Persons also stated in the affidavit that she
was told during the mediation proceedings that “all damages” were included in the
$195,000 figure, and agreed with the settlement at that point. Id.
{¶ 86} The trial court stated that:
Clearly the settlement dealt with all aspects of [Persons’] case and that all
damages were included as she alleges she was advised. The Court has
no idea what Plaintiff means by “to incorporate the constructive evidence
that two more future surgeries would be required.” If she means that Mr.
Schultz advised her that the settlement includes all future damages,
including future surgeries, it does.
May 2, 2016 Orders on Summary Judgment, p. 7.
{¶ 87} We agree with the trial court. Furthermore, even if we assumed that
Persons’ claim fits within the less stringent standard in Vahila, the fact is that Persons
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failed to present “some” or even any evidence of the merits of her underlying claim.
Vahila, 77 Ohio St. 3d at 428, 674 N.E.2d 1164.
{¶ 88} Moreover, Persons also failed to present any evidence that Appellees failed
to comply with appropriate standards of care in settling her case. “[I]n a legal malpractice
case, expert testimony is generally required in order to prove breach of the duty that the
attorney owed to the plaintiff, unless the claimed breach of professional duty is ‘well within
the common understanding of * * * laymen.’ ” Lundeen, 2015-Ohio-4462, 46 N.E.3d 236,
at ¶ 17, quoting McInnis v. Hyatt Legal Clinics, 10 Ohio St. 3d 112, 461 N.E.2d 1295
(1984).
{¶ 89} In the case before us, the issue of Appellees’ alleged negligence could not
be determined by laypersons without the assistance of expert witnesses. Whether the
settlement was appropriate in light of the alleged injury is not something within the
common knowledge of laypersons. Accordingly, because Persons failed to set forth any
evidence on the issue of the alleged malpractice, the trial court properly rendered
summary judgment in favor of Appellees. Persons’ Third Assignment of Error, therefore,
is overruled.
V. Conclusion
{¶ 90} All of Persons’ assignments of error having been overruled, the judgment
of the trial court is affirmed.
.............
HARSHA, J. and HOOVER, J., concur.
(Hon. William H. Harsha and Hon. Marie Hoover, Fourth District Court of Appeals, sitting
by assignment of the Chief Justice of the Supreme Court of Ohio.)
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Copies mailed to:
Dwight D. Brannon
Matthew C. Schultz
Donna K. Persons
Arthur Phelps
Laurence Lasky
Hon. Dale A. Crawford, Visiting Judge
c/o Montgomery County Common Pleas Court