Calvin Eaton v. State Farm Mutual Automobile Insurance Company

If this opinion indicates that it is “FOR PUBLICATION,” it is subject to
revision until final publication in the Michigan Appeals Reports.
STATE OF MICHIGAN
COURT OF APPEALS
CALVIN EATON, UNPUBLISHED
March 12, 2019
Plaintiff-Appellant,
v No. 341994
Bay Circuit Court
JAMIE HUMPERT, ESCKILSEN SONS AND LC No. 16-003628-NI
PAINTING, LAWRENCE ESCKILSEN, and
JEFFREY ESCKILSEN,
Defendants,
and
BAY JUSTICE ASSOCIATES, PLC,
Appellee.
CALVIN EATON,
Plaintiff-Appellant,
v No. 342004
Bay Circuit Court
STATE FARM MUTUAL AUTOMOBILE LC No. 16-003076-NF
INSURANCE COMPANY,
Defendant,
and
BAY JUSTICE ASSOCIATES, PLC,
Appellee.
Before: METER, P.J., and SERVITTO and REDFORD, JJ.
PER CURIAM.
In these consolidated cases, plaintiff—through his attorney, Jason Gower—appeals by
right the trial court’s order awarding $5,000 in attorney fees to attorney Edward Czuprynski of
appellee Bay Justice Associates, PLC. We reverse.
I. BACKGROUND
Plaintiff was involved in an automobile accident on September 26, 2013. He retained
Czuprynski’s services, and the two entered into a contingent-fee agreement in November 2013.
Czuprynski eventually initiated two lawsuits on plaintiff’s behalf: a third-party lawsuit and a
first-party lawsuit. Czuprynski, however, waited until February 2016 to file the first-party
lawsuit and until September 26, 2016—the day the statutory-limitations period was set to
expire—to file the third-party lawsuit. Based on the general lack of progress in the cases and
several other allegations of misconduct, plaintiff discharged Czuprynski and retained the services
of Gower.
Gower successfully negotiated a settlement of $65,000 in the third-party lawsuit and
$15,000 in the first-party lawsuit, after which Czuprynski mailed Gower notice of an attorney
lien through which he sought compensation for his out-of-pocket expenses and legal services
performed for plaintiff on these cases. Czuprynski claimed that he was entitled to $12,500 of the
$80,000 settlement, which was consistent with a provision in the contingent-fee agreement
entitling him to 1/6 of plaintiff’s settlement after his discharge. Gower filed a motion for
determination of attorney fees. Gower did not dispute that Czuprynski was entitled to out-of-
pocket costs; however, Gower argued that Czuprynski was not entitled to compensation for his
legal services. According to Gower, because Czuprynski had been discharged for his
misconduct, Czuprynski was precluded from recovering attorney fees—either under the
contingent-fee agreement or quantum meruit.
The trial court agreed that Czuprynski had engaged in professional misconduct.
Specifically, the trial court found that Czuprynski failed to timely file plaintiff’s claim for first-
party benefits (which prejudiced plaintiff under the one-year-back rule), failed to conduct timely
discovery, and failed to disclose his contemporaneous representation of the other driver involved
in plaintiff’s accident. The trial court concluded that this misconduct precluded Czuprynski from
recovering under the contingent-fee agreement or quantum meruit. Nevertheless, the trial court
found that it was “fair and just and juris to give [sic] Mr. Czuprynski some benefit for the work
he’s done” and awarded him $5,000 in attorney fees. This appeal followed.
II. ANALYSIS
We review for an abuse of discretion the trial court’s decision whether to impose an
attorney lien. Reynolds v Polen, 222 Mich. App. 20, 24; 564 NW2d 467 (1997). On appeal,
Gower does not challenge the factual findings of the trial court. Rather, Gower argues that the
trial court erred by awarding Czuprynski any attorney fees in light of Czuprynski’s misconduct.
We agree.
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When a client wrongfully terminates an attorney, the attorney is entitled to attorney fees
on a quantum meruit basis. Id. Recovery is based on quantum meruit rather than any
contingent-fee agreement “because a client has an absolute right to discharge an attorney and is
therefore not liable under the contract for exercising that right.” Id. at 24-25. Nonetheless,
“quantum meruit recovery of attorney fees is barred when an attorney engages in misconduct that
results in representation that falls below the standard required of an attorney (e.g., disciplinable
misconduct under the Michigan Rules of Professional Conduct) or when such recovery would
otherwise be contrary to public policy.” Id. at 26.
Here, the trial court found that plaintiff justifiably discharged Czuprynski because of
Czuprynski’s professional misconduct. That finding has not been challenged on appeal.
Therefore, because Czuprynski’s professional misconduct was the basis of his discharge,
Czuprynski was precluded from recovering attorney fees in quantum meruit. Accordingly, we
conclude that the trial court abused its discretion by awarding Czuprynski $5,000 in attorney fees
so that Czuprynski could recover “some benefit for the work he’s done.”
We reverse and remand to the trial court for further proceedings consistent with this
opinion. We do not retain jurisdiction.
/s/ Patrick M. Meter
/s/ Deborah A. Servitto
/s/ James Robert Redford
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