Adams v. Howard

Cite as 2014 Ark. App. 328
ARKANSAS COURT OF APPEALS
DIVISION I
No. CV-13-935
LAUREN ADAMS and ADAMS, Opinion Delivered May 28, 2014
BRADY & JACKSON, PLLC
APPELLANTS APPEAL FROM THE BENTON
COUNTY CIRCUIT COURT
V. [NO. P-03-461]
GARY HOWARD, Individually and as the HONORABLE XOLLIE DUNCAN,
Administrator of the Estate of Odis JUDGE
Howard, Deceased
APPELLEE AFFIRMED
ROBERT J. GLADWIN, Chief Judge
Appellant Lauren Adams and her law firm, Adams, Brady & Jackson, PLLC, appeal
from an order that established the manner in which they could recover their fee for
representing appellee Gary Howard.1 We affirm the court’s order.
I. Background
The events leading to this case began over fifteen years ago and have generated two
prior appeals: Howard v. Adams, 2009 Ark. App. 621, 332 S.W.3d 24 (Howard I), and Howard
v. Adams, 2012 Ark. App. 562, 424 S.W.3d 337 (Howard II). The case history can be found
in those opinions, but we will reiterate the relevant facts for ease of understanding.
In 2002, Adams represented Gary Howard in a suit against his stepmother, Mabel
Howard. The purpose of the suit was to recover approximately forty-six acres of land from
a trust that held the assets of Gary’s late father, Odis. Gary had been a beneficiary and co-
1
For convenience, we will refer to Lauren Adams as the sole appellant.
Cite as 2014 Ark. App. 328
trustee with Mabel, but, with the assistance of attorney Bill Watkins, Mabel amended the trust
to reduce Gary’s beneficial interest and eliminate his role as trustee.
Adams successfully recovered the realty in February 2005 and placed the property into
Odis’s estate, of which Gary was the sole heir. Mabel’s dower and homestead interests as
Odis’s widow were later settled for $110,500.
Once the property was recovered, a dispute arose over Adams’s fee. Gary insisted that
Adams had promised to collect her fees via a legal-malpractice claim against Watkins. Adams
denied making that arrangement and said that the terms of her representation were governed
by the following contingency-fee contract:
[Adams] will be entitled to the following percentages of any damages award collected
on behalf of [Gary]:
33% of all amounts recovered after filing suit.
According to Adams, the terms of this agreement meant that her fee would be one-
third of the property’s $1.8 million value as of the date it was recovered in February 2005. She
filed a claim against Odis’s estate for “33% of the real property recovered or the sum of
$613,333,” and an attorney-fee lien for “33% of the proceeds derived from the [46 acres]
including but not limited to sale proceeds . . . .”
In August 2005, Gary sued Adams for breach of contract, deceit, and negligence,
claiming that she had wrongfully sought her attorney’s fees from the estate rather than from
Watkins’s malpractice insurer. In a pretrial order dated February 16, 2007, the court ruled that
Adams’s attorney-fee lien was “properly in place against the real estate.” However, the court
found that questions remained over whether Adams had agreed to collect part of her fees from
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Watkins’s malpractice carrier. The court declared that Gary must try his case to a jury if he
wished to offset Adams’s fee claim.
The trial was held in January 2011, and the jury awarded no damages to Gary or the
estate. While the case was on appeal, Gary continued his long-standing efforts to sell the forty-
six acres. The property’s worth had purportedly dropped after being appraised at $2 million
in 2006, and, as of 2011, it still had not sold. Adams’s attorney-fee lien therefore remained
unsatisfied.
In March 2011, Adams asked the court to establish her fee as $613,333, given that
Gary’s lawsuit yielded no offsets. Gary responded that, if the property were sold, Adams
should recover a third of any sales price, less the $110,500 paid to Mabel. He also claimed that
Adams should receive “one-third of the real estate itself” as her fee.
On July 24, 2013, the circuit court entered an order that allowed Adams to foreclose
on her attorney-fee lien. The court ruled, however, that Adams’s fee would be based on the
price of the land in an upcoming sale:
It is the decision of the Court that, because of the wording of the contract, [Adams is]
entitled to foreclose [her] lien against the real estate, but that at a sale of the real estate,
whether by forced sale on the courthouse steps or on the open market, [Adams] is
entitled to receive 33% of the net sales price of the real estate.
Further, the amount previously paid to Mabel Howard for her interest is to be
deducted from the full sales price of the real estate, after which time the 33% will be
set aside to Adams . . . . In other words, the entire $110,500 will not come from the
33% set aside to Adams . . . but will be deducted from the total sales price prior to the
computation of the 33% that will represent [Adams’s] lien . . . .
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Adams appeals from that order.2
II. Interest in Land
Adams argues first that Gary is barred from claiming that her fee should consist of an
ownership interest in the forty-six acres. We need not address this point. The circuit court did
not grant Adams an ownership interest in the property but permitted a monetary recovery in
the form of a percentage of the property’s sales price. Any discussion of this issue would
therefore be academic. Our court does not decide academic questions. See Kuelbs v. Hill, 2010
Ark. App. 427, 379 S.W.3d 47.
III. Method of Calculating the Fee
Adams argues next that the court erred in calculating her fee as a percentage of the
property’s future sales proceeds. She contends that her fee should be established as
$613,333—one-third of the property’s $1.8 million value at the time it was recovered in
February 2005. We disagree.
Adams’s contract with Gary did not establish a method of calculating her fee; it simply
stated that the fee would be one-third of the “amount recovered.” Given that she was hired
to recover real property and—as she herself argues—her fee was to be paid in dollars, Adams
should have realized that the property must be sold at some point to satisfy her lien. She
therefore took the risk that the amount of her fee would depend on the proceeds generated
by the property’s sale. Consistent with this, Adams filed her lien for thirty-three percent of
2
Because this is a probate matter, all orders are immediately appealable, with exceptions
not applicable here. Howard I, 2009 Ark. App. 621, 332 S.W.3d 24.
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the “proceeds” from the property. Thus, the circuit court could reasonably have concluded
that Adams’s fee would not be fixed until a sale of the property occurred.
Adams relies on Simler v. Conner, 352 F.2d 138 (10th Cir. 1965), Rector v. Compton, 62
Ark. 279, 36 S.W. 898 (1896), and other authorities for the proposition that her fee should
be determined as of the date she recovered the property. While those cases bear similarities
to the situation before us, the facts here are unique with regard to the parties’ representation
contract. Given the circumstances, we cannot say that the circuit court clearly erred in the
method it employed to establish the amount of Adams’s lien. See May Constr. Co., Inc. v.
Town Creek Constr. & Dev., LLC, 2011 Ark. 281, 383 S.W.3d 389 (applying the clearly
erroneous standard in reviewing the calculation of a lien amount).
IV. Legal Bar and Estoppel
Adams asserts that Gary is barred by law of the case, laches, and judicial estoppel from
claiming that her contingency fee should be calculated on the future sales price of the
property. We see no bar to Gary’s claims.
Law of the case prohibits a court from reconsidering issues of law and fact that have
already been decided on appeal, as well as those that might have been presented, but were not,
in a prior appeal. Carter v. Cline, 2013 Ark. 398, ___ S.W.3d ___. According to Adams, law
of the case prevents Gary from challenging the February 2007 order that validated her fee
because he failed to challenge the fee in his prior appeals. However, the February 2007 order,
by its own terms, was limited to the issue of whether Adams’s lien was properly in place. It
did not set Adams’s fee amount or establish a method of calculating her fee. Consequently,
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the amount of Adams’s fee could not have been challenged by Gary in the earlier appeals.
With regard to laches, it is an equitable doctrine that requires a detrimental change in
position by one party and an unreasonable delay by the other party. See Gable v. Anthony,
2010 Ark. App. 757. The application of laches is based on the particular circumstances of each
case and is a question of fact for the trial court. See id.
Adams argues that Gary delayed in challenging her fee and precluded her from
“pursuing a partition action to enforce her ownership interest in the subject property” when
real-estate prices were “at an all-time high,” apparently referring to the years 2005–06. We
first restate that Adams was not granted an ownership interest in the property, so her claim
of delay in seeking a partition is not well-taken. In any event, we do not believe the circuit
court was bound to find that Gary occasioned any unreasonable delays with regard to Adams’s
fee. It was not until 2011 that a trial was held to determine the crucial matter of whether there
were any offsets to the fee.
Finally, on the matter of judicial estoppel, a prima facie case consists of the following
elements: (1) a party must assume a position that is clearly inconsistent with a position taken
in an earlier case or in the same case; (2) a party must assume the inconsistent position with
the intent to manipulate the judicial process to gain an unfair advantage; (9)(3) a party must
have successfully maintained the position in an earlier proceeding such that the court relied
on the position taken; and (4) the integrity of the judicial process of at least one court must
be impaired or injured by the inconsistent positions taken. Purser v. Buchanan, 2013 Ark. App.
449. The doctrine of judicial estoppel is not to be applied in an unduly strict manner; it is
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intended to protect the integrity of the courts, not as a technical defense for litigants to derail
a potentially meritorious claim. See Mitchell v. Ramsey, 2011 Ark. App. 9, 381 S.W.3d 74.
Adams argues that Gary previously asserted that her fee amount was $613,333 and that
he should be judicially estopped from saying otherwise. She specifically points to Gary’s
response to her motion in limine filed before the 2011 trial on the issue of whether he and
the estate were damaged by the attorney-fee lien. Gary responded to the motion by arguing
that Adams’s lien of $613,333 was not uncertain or speculative and that the lien amount had
been established by the court.
Unquestionably, Gary’s current position with regard to the lien amount is inconsistent
with his above statements. However, inconsistency alone is not enough to establish a prima
facie case for judicial estoppel; all four of the above elements must be proved. Nothing in the
record indicates that the court, in deciding on the motion in limine, relied on Gary’s
representations as to the amount of the lien. Nor does Adams sufficiently explain how the
court so relied. We therefore are not persuaded that reversible error occurred.3
V. Deduction of Dowry Amount
The court ruled that the $110,500 paid for Mabel’s dower and homestead interests
would be deducted from the sales price of the property and that, following that deduction,
3
Adams’s argument heading also asserts the bars of res judicata and collateral estoppel.
However, the body of her argument does not discuss these doctrines on this particular point.
If an argument heading raises an issue but the body of the argument does not address the
issue, we will not reach it on appeal. See Jones v. McLemore, 2014 Ark. App. 147, ___ S.W.3d
___. In any event, the doctrines do not bar Gary’s claims for the same reasons stated earlier
in this opinion.
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Adams’s fee would be set as one-third of the remaining proceeds.
Adams argues that the court erred in deducting the dower amount before calculating
her fee. However, Adams had already agreed to the court’s action. In a pretrial hearing, she
stated that she would be entitled to a third of the value of the real estate “only after [Mabel’s]
dower interest is deducted.” She also stated in a trial brief that she “agreed that the value of
the recovery should be reduced by [the] amount [Gary] has paid to the decedent’s surviving
spouse, Mabel Howard, prior to the determination of her contingency fee.” An appellant
cannot complain on appeal that the trial court erred if the appellant induced, consented to,
or acquiesced in the court’s position. See Colquitt v. Colquitt, 2013 Ark. App. 733, ___ S.W.3d
___.
VI. Prejudgment Interest and Attorney’s Fees
Adams argues that she is entitled to prejudgment interest on the amount of her fee
from the date the property was recovered in February 2005, and that she is entitled to
attorney fees as the prevailing party in a contract action. See Ark. Code Ann. § 16-22-308
(Repl. 1999). Because we have affirmed the circuit court’s ruling that the fee will not be
determined until a future sale of the property, prejudgment interest is not available. Nor is
Adams the prevailing party for the purpose of an award of attorney’s fees under section 16-22-
308.
Affirmed.
VAUGHT and BROWN, JJ., agree.
Tamra Cochran, for appellants.
Harry McDermott, for appellees.
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