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Consolver v. Hotze

Supreme Court of Kansas

June 9, 2017

Mahnaz Consolver, Appellant,
v.
Chris Hotze, Defendant, and Bradley A. Pistotnik and the Affiliated Attorneys of Pistotnik Law Offices, P.A., Appellees.

         SYLLABUS BY THE COURT

         1. An attorney employed under a contingency fee contract who is discharged without cause is limited to a quantum meruit recovery for the reasonable value of the services rendered.

         2. All the factors identified in K.S.A. 2016 Supp. 7-121b(a) and Kansas Rule of Professional Conduct 1.5(a) (2017 Kan. S.Ct. R. 292)-including whether the fee agreement is fixed or contingent-are relevant to the equitable determination of the reasonable value of legal services rendered.

         Review of the judgment of the Court of Appeals in 51 Kan.App.2d 286, 346 P.3d 1094 (2015).

Appeal from Sedgwick District Court; J. Patrick Walters, judge. Judgment of the Court of Appeals reversing the district court is reversed. Judgment of the district court is affirmed.

          Stephen L. Brave, of Brave Law Firm, LLC, of Wichita, argued the cause and was on the briefs for appellant.

          Jonathan Sternberg, of Jonathan Sternberg, Attorney, P.C., of Kansas City, Missouri, argued the cause, and Jennifer M. Hill, of McDonald, Tinker, Skaer, Quinn & Herrington, P.A., of Wichita, was with him on the briefs for appellees.

          OPINION

          STEGALL, J.

         This case concerns a fee dispute between two attorneys-Bradley A. Pistotnik and Stephen L. Brave-each of whom represented Mahnaz Consolver at different stages of her personal injury lawsuit. Pistotnik filed the case after Consolver engaged him through a contingency fee agreement. Although Consolver and Pistotnik's relationship was strained throughout the representation, it endured through discovery to the mediation stage of the case, during which Pistotnik and defense counsel agreed that defendant would offer $300, 000 to settle the case if Consolver could show that she needed an additional surgery to repair her knee. Before defense counsel could make a formal offer, however, Consolver terminated Pistotnik without cause.

         Immediately thereafter, Consolver hired Brave, who later settled the case for $360, 000. Pistotnik filed an attorney lien on the judgment, and following an evidentiary hearing, the district court found that Pistotnik was entitled to a fee in the amount of $86, 944.27 and expenses in the amount of $10, 156.81. Consolver appealed, and the Court of Appeals reversed the district court. We granted review.

         Factual and Procedural Background

         In April 2011, Consolver hired Bradley A. Pistotnik of Affiliated Attorneys of Pistotnik Law Offices, P.A., to represent her in a personal injury action against Chris Hotze for injuries arising out of a car accident. Prior to filing the case, Consolver signed a standard contingency fee agreement with Pistotnik providing that Pistotnik would advance all expenses and labor in the pursuit of Consolver's claims and that Consolver would owe nothing in the event no recovery was obtained. If there was a recovery, the fee agreement required Pistotnik to be paid one-third of the amount after reimbursing expenses or, if the recovery occurred after the pretrial conference, then 40 percent of the amount after expenses. The contract was silent regarding what would occur if the lawyer-client relationship terminated before Consolver's claim was resolved.

         Through Pistotnik, Consolver filed a petition in Sedgwick County District Court against Hotze, alleging that in February 2011, a vehicle being driven by Hotze collided with another vehicle, which resulted in injuries to Consolver. Hotze denied many of the allegations and requested a jury trial. Consolver originally claimed damages in the amount of $1, 130, 000 but later increased her claim to $1, 405, 961.40. A trial date was eventually set for August 7, 2012.

         Shortly after the representation began, Consolver and Pistotnik's relationship began to deteriorate. The record before us details numerous disputes between the two, but we need not recount them here. Highly summarized, the record indicates that Consolver believed Pistotnik was too busy to focus on her case and did not pursue it with sufficient zeal, while Pistotnik believed that he pursued Consolver's claims with prudence and skill and gave her case exactly the level of attention it required.

         In May 2012, the parties to the lawsuit spent a day in mediation attempting to settle the case. Pistotnik claimed that mediation "[d]iscussions concluded with the understanding that an offer for the sum of three hundred thousand dollars ($300, 000.00) would be made, contingent upon proof that [Consolver] would require additional surgery[, ] and [Hotze] was requiring additional records and bills from health care providers for recent treatment." In support of this claim, Pistotnik provided an affidavit from Hotze's attorney Craig Kennedy detailing the events surrounding mediation. Kennedy averred that on the day of mediation, he and Pistotnik had agreed that a $300, 000 settlement offer would be made to Consolver if she provided proof that she was to undergo a second knee surgery. Kennedy and Pistotnik spoke on several occasions after mediation about getting the necessary medical records.

         The affidavit further stated that Kennedy received an email from Pistotnik on June 20, 2012, stating that Consolver had been scheduled for surgery. One week later on June 27, 2012, Kennedy told Pistotnik in person that he was obtaining authorization for the $300, 000 settlement and would be sending out a formal offer letter in the next several days. Kennedy called Pistotnik the next day-June 28, 2012-to inform him that he expected to receive authority to offer a $300, 000 settlement. On the same day he called Pistotnik, Kennedy received an email from Pistotnik informing him that Consolver would no longer accept the $300, 000 settlement offer. An email from Pistotnik to Kennedy indicates that Consolver rejected the $300, 000 because her doctor had told her that she would need surgery next month and a knee replacement in the future. Pistotnik said in the email that he thought they would "need to get into the 400k range to get settled."

         The day after receiving the email, Kennedy received official authority to submit the $300, 000 offer. Because Kennedy was unable to contact Pistotnik that day, he sent Pistotnik an email on June 30, 2012, offering $300, 000 to settle the case. On July 2, 2012, Kennedy confirmed the offer through a letter sent to Pistotnik. Finally, the affidavit stated that Hotze and his insurance carrier had made no offers in excess of $300, 000 and that all settlement ...


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