SUN YOUNG KIM VS. WAL-MART STORES, INC. (L-2203-15, HUDSON COUNTY AND STATEWIDE)

NOT FOR PUBLICATION WITHOUT THE
APPROVAL OF THE APPELLATE DIVISION
This opinion shall not "constitute precedent or be binding upon any court." Although it is posted on the
internet, this opinion is binding only on the parties in the case and its use in other cases is limited. R. 1:36-3.
SUPERIOR COURT OF NEW JERSEY
APPELLATE DIVISION
DOCKET NO. A-3668-17T1
SUN YOUNG KIM,
Plaintiff,
v.
WAL-MART STORES, INC.,
Defendant.
___________________________
IN THE MATTER OF ANDREW
PARK, PC,
Appellant.
___________________________
Argued February 28, 2019 – Decided March 28, 2019
Before Judges Simonelli and Firko.
On appeal from Superior Court of New Jersey, Law
Division, Hudson County, Docket No. L-2203-15.
David M. Wasserman argued the cause for pro se
appellant.
Pasha Razi argued the cause for pro se respondent Jae
Lee Law, PC.
PER CURIAM
Appellant Andrew Park, PC (Park) substituted as counsel for plaintiff Sun
Yong Kim during a personal injury matter. Park appeals from the March 16,
2018 Law Division order, which denied its motion for reconsideration of the
January 18, 2018 order awarding plaintiff's prior counsel, respondent Jae Lee
Law, PC (Lee), two-thirds of the one-third legal fee on a $125,000 settlement,
plus interest and costs. We reverse and remand for further proceedings.
Plaintiff retained Lee on a contingency basis to represent her with regard
to injuries she allegedly sustained from a slip-and-fall at the premises of
defendant Wal-Mart Stores, Inc. (Wal-Mart). Lee filed a complaint against Wal-
Mart on May 21, 2015, and claimed it represented plaintiff for over a year and
seven months, during which it conducted an investigation and engaged in
discovery. Lee eventually procured a $125,000 settlement offer.
On October 17, 2016, plaintiff notified Lee that she was discharging the
firm and had retained Park to represent her in this matter. In an October 25,
2016 letter to Park, Lee stated as follows:
This letter will serve to confirm that your firm
acknowledged our lien for services rendered to
[plaintiff] and you agree that all attorney's fees shall be
held in escrow pending an apportionment hearing
before a Superior Court [j]udge or unless your firm and
my firm reach an amicable apportionment agreement.
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In a January 5, 2017 letter to the court, Lee stated it had procured a $125,000
settlement and "asserts a lien for the legal fees commensurate with the entire
settlement offer of $125,000 since [Park's] office contributed no legal services
in the obtaining of that offer." In a March 23, 2017 letter to Park and Wal-Mart's
counsel, Lee stated it was "entitled to the entire attorney's fee attributable to [the
$125,000] offer of settlement, and this letter shall confirm that [Lee] asserts a
lien for the full attorney fee up to that amount." Lee did not send any of these
letters to plaintiff and did not attach its retainer agreement with her.
The record does not reveal whether plaintiff rejected the settlement offer;
however, it shows that on November 17, 2016, Wal-Mart filed a motion for
summary judgment. Lee prepared opposition, as Park had not been substituted
as counsel for plaintiff. The circumstances of Park's delayed substitution are the
subject of much dispute. Park claims that Lee refused to sign a necessary
certification and sent letters to plaintiff and the court, blaming Park for the delay.
Nevertheless, on January 20, 2017, after a hearing, the court substituted Park as
counsel for plaintiff.
In a February 2, 2017 order, the trial court granted summary judgment to
Wal-Mart and dismissed the complaint with prejudice. Park and Lee dispute
who was responsible for this result. Park argues on appeal that it was forced to
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present a weak theory of liability in opposition to summary judgment, i.e.,
inferred negligence and constructive knowledge by way of only circumstantial
evidence, because Lee failed to conduct meaningful discovery, such as deposing
defendant's employees, to establish actual knowledge of the liquid that allegedly
caused plaintiff's fall. Conversely, Lee argues that Park disavowed its theory of
liability espoused in its opposition to summary judgment, and it was that theory
under which Lee had obtained the settlement offer.
In any event, Wal-Mart withdrew its settlement offer after its victory.
Park subsequently filed an appeal of the February 3, 2017 order. Thereafter,
Park re-entered settlement negotiations with Wal-Mart. On June 6, 2017, the
matter settled for $125,000.
On October 6, 2017, Lee filed a motion for an award of attorney's fees of
one-third of the $125,000 settlement based on quantum meruit, plus interest and
costs. Lee did not serve plaintiff with the motion. Park opposed the motion,
arguing Lee was not entitled to a quantum meruit fee because of its conduct in
this case, and Lee failed to file a certification of services.
The court denied the motion on the papers and entered an order on
November 17, 2017, awarding Lee two-thirds of the one-third fee on the
$125,000 settlement, plus interest and costs. The court found as follows:
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Movant's response violates [Rule] 1:4-6. Movant is
entitled to [two-thirds] of the [one-third] of the legal fee
on the settlement amount of $125,000. The [c]ourt
finds [Lee] represented plaintiff and secured a
settlement amount. During the period of time in which
[Lee] represented the plaintiff, the case was dismissed.
[Lee is] entitled to "as much as they deserve."
LaMantia [v. Durst,] 234 N.J. Super. 534, 537 (App.
Div. 1989).[1]
The court did not award a specific amount for interest and costs and gave no
reason for this award.
On February 15, 2018, Park filed a motion for reconsideration, arguing
the court failed to conduct a quantum meruit analysis and Lee was not entitled
to interest and costs. The court denied the motion on the papers and entered an
order on March 16, 2018, finding as follows:
Movant's response violates [Rule] 1:4-9. Movant failed
to specify how th[e] [c]ourt based its decision on
[p]alpably incorrect or irrational basis or did not
consider or failed to appreciate the significance of
probative [or] [competent] evidence. Movant reargues
points made during the original motion.
This appeal followed.
1
On January 19, 2018, the court entered an order amending the November 17,
2017 order to correct the name of Park. The amended order contains the same
statement of reasons.
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As a threshold matter, we note that Park did not argue before the trial
court, as it does on appeal, that N.J.S.A. 2A:13-5 required a plenary hearing.
Generally, we will not consider issues that were not raised before the trial court
and are not jurisdictional in nature or substantially implicate the public interest.
Zaman v. Felton, 219 N.J. 199, 226-27 (2014). Nevertheless, we consider
whether N.J.S.A. 2A:13-5 governs.
N.J.S.A. 2A:13-5 provides as follows:
After the filing of a complaint or third-party complaint
or the service of a pleading containing a counterclaim
or cross-claim, the attorney or counsellor at law, who
shall appear in the cause for the party instituting the
action or maintaining the third-party claim or
counterclaim or cross-claim, shall have a lien for
compensation, upon his client's action, cause of action,
claim or counterclaim or cross-claim, which shall
contain and attach to a verdict, report, decision, award,
judgment or final order in his client's favor, and the
proceeds thereof in whosesoever hands they may come.
The lien shall not be affected by any settlement between
the parties before or after judgment or final order, nor
by the entry of satisfaction or cancellation of a
judgment on the record. The court in which the action
or other proceeding is pending, upon the petition of the
attorney or counsellor at law, may determine and
enforce the lien.
There must be a specific notice of intent to rely on N.J.S.A. 2A:13-5.
Martin v. Martin, 335 N.J. Super. 212, 224 (App. Div. 2000). As we have held:
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A letter to the client, court, and substituting counsel
would suffice as would properly worded language on or
attached to the written substitution of attorney. The
notice should be as specific as possible. It should set
out the intent to rely upon N.J.S.A. 2A:13–5, the
amount of fees being sought, the retainer agreement
with the client, and the basis of the fee calculation. It is
at this point that pre-action notice, pursuant to [Rule]
1:20A–6, should be given to the former client so that if
arbitration is requested it can be initiated expeditiously.
[Ibid.]
"Notice must also be given of the right to fee arbitration pursuant to [Rule]
1:20A-6 if it has not previously been given." Id. at 225.
In addition to notice, H. & H. Ranch Homes, Inc. v. Smith, 54 N.J. Super.
347, 353-54 (App. Div. 1959) sets forth the procedures to be followed to
effectuate a lien under N.J.S.A. 2A:13-5:
For the guidance of counsel in connection with future
applications, consistent with the spirit of our present
rules of practice, we suggest that, where the
determination or enforcement of an attorney's lien is
sought, the following procedure, patterned on Artale[v.
Columbia Ins. Co., 109 N.J.L. 463, 467-468 (E. & A.
1932)], be employed: The attorney should make
application to the court, as a step in the proceeding of
the main cause, by way of petition, which shall set forth
the facts upon which he relies for the determination and
enforcement of his alleged lien. The petition shall as
well request the court to establish a schedule for further
proceedings which shall include time limitations for the
filing of an answer by defendants, the completion of
pretrial discovery proceedings, the holding of a pretrial
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conference, and the trial. The court shall, by order, set
a short day upon which it will consider the application
for the establishment of a schedule. A copy of such
order, together with a copy of the petition, shall be
served upon defendants as directed by the court. The
matter should thereafter proceed as a plenary suit and
be tried either with or without a jury, in the Law
Division, depending upon whether demand therefor has
been made . . . or without a jury if the venue of the main
cause is laid in the Chancery Division. In no event
should the matter be tried as a summary proceeding.
Thus, an attorney seeking to enforce an attorney's lien under N.J.S.A.
2A:13-5 must file a separate petition in the underlying action. "[S]imply moving
for an attorney's lien pursuant to N.J.S.A. 2A:13-5, as distinguished from filing
a complaint demanding a fee, is not the proper way to establish an attorney's
lien." Martin, 335 N.J. Super. at 223. The attorney must "initiate an action for
fees on notice to the client and all other attorney claiming or potentially claiming
rights to fee awards." Id. at 225.
Here, Lee gave no notice to plaintiff of its intent to rely on N.J.S.A. 2A:13-
5, and plaintiff's right to fee arbitration. Id. at 224-25. Lee never even notified
plaintiff of its motion for an award of attorney's fees. In addition, Lee's letters
to Park and the court did not provide specific notice of Lee's intent to rely on
N.J.S.A. 2A:13-5, or provide the retainer agreement with the plaintiff and the
basis of the fee calculation. Id. at 224.
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Further, Lee did not comply with the procedural requirements to
effectuate the lien. Lee did not file a separate petition to enforce the statutory
lien. Id. at 233; H. & H. Ranch Homes, Inc., 54 N.J. Super. at 353-54.
Accordingly, N.J.S.A. 2A:13-5 does not govern because Lee did not establish a
lien under the statute. It is perhaps for this reason that Lee sought an attorney
fee award based on quantum meruit. Thus, we address whether the court erred
in failing to conduct a quantum meruit analysis and provide sufficient findi ngs
of fact and conclusions of law for its award.
We have provided guidelines as to the relevant factors for the trial court
to consider in determining quantum meruit awards as between predecessor and
successor law firms:
Trial courts should consider the length of time each of
the firms spent on the case relative to the total amount
of time expended to conclude the client's case. The
quality of that representation is also relevant.
Therefore, the result of each firm's efforts as well as the
reason the client changed attorneys are factors to be
considered. Viability of the claim at transfer also bears
upon the value of a former firm's contribution-if the
case was initially speculative but concrete by the time
the cause of action moved to the second firm, that factor
should bear upon the distribution. The amount of the
recovery realized in the underlying lawsuit also impacts
upon the quantum meruit valuation. It is also necessary
to examine any pre-existing partnership agreements
between the members of the firms who now compete
for a percentage of the contingency fee.
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[LaMantia, 234 N.J. Super. at 540-41 (citations
omitted).]
The court here did not engage in this analysis, but rather, gave a cursory
explanation for the award of attorney's fees to Lee and denial of reconsideration,
and no explanation for the award of costs and interest. Procedurally, the court's
minimal findings are an abrogation of its duty "to make findings of fact and to
state reasons in support of [its] conclusions." Giarusso v. Giarusso, 455 N.J.
Super. 42, 53 (App. Div. 2019) (quoting Heinl v. Heinl, 287 N.J. Super. 337,
347 (App. Div. 1996) (citing R. 1:7-4)). "Meaningful appellate review is
inhibited unless the judge sets forth the reasons for his or her opinion." Ibid.(quoting Strahan v. Strahan, 402 N.J. Super. 298, 310 (App. Div. 2008)).
"Naked conclusions do not satisfy the purpose of [Rule] 1:7-4." Id. at 54
(alteration in original) (quoting Curtis v. Finneran, 83 N.J. 563, 570 (1980)).
Substantively, there were many facts in dispute, which the court resolved
without a plenary hearing or certifications of services from each side. By merely
stating a "naked conclusion" awarding Lee two-thirds of the one-third legal fee
on the $125,000 settlement, the court did not meaningfully delve into the factors
set forth in LaMantia. The court's failure to explain its award of interest and
costs or reconsider the award compounds this error. Accordingly, we reverse
and remand for a plenary hearing to determine Lee's quantum meruit claim. On
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remand, the parties shall submit certifications of services along with supporting
documents.
Reversed and remanded for further proceedings consistent with opinion.
We do not retain jurisdiction.
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