Legal Malpractice

2 Sides of the Coin in a Fee-Malpractice Case

By (Andrew Lavoott Bluestone)

What do the parties really think in an attorney - fee dispute which totals in the $6 million range.  Most attorney fee disputes are less than $50,000,  In NY that qualifies for the court monitored Attorney-Fee dispute program  Here, in a startling NYLJ article Nate Raymond writes about the Debevoise & Plimpton cases against Candlewood Timber Group LLC.
 

Here are some of the issues in the case, from the NYLJ:  "Debevoise, which grossed $760.8 million in 2008, in its complaint said it submitted invoices and requests for payment to Candlewood for a year after trial wrapped in May 2006. Debevoise also attempted earlier this year to take Candlewood to arbitration.

But in March, Candlewood filed a petition to stay the proceedings, arguing its engagement letter with the firm did not cover arbitration.

Debevoise withdrew its notice to arbitrate in June, according to an affirmation in the proceedings in Debevoise & Plimpton LLP v. Candlewood Timber Development, LLC, 103982-2009. It then sued Candlewood and its principal, Jeffrey Kossak, on Nov. 12 (Debevoise & Plimpton LLP v. Candlewood Timber Group, LLC, 603479-2009).

According to the state court complaint, the fee dispute stems from Debevoise's representation of Candlewood in litigation against Pan American Energy LLC, a joint venture of BP p.l.c. and Bridas Corporation, which had subsurface rights to extract oil and gas in Argentina on land owned by Candlewood.

In an interesting side note to the article, a "legal cost" expert tells the firm not to sue for $6 million in fees.  Aside from the astounding concept, we wonder about the advice:

"John Marquess, president of Legal Cost Control Inc. in Haddonfield, N.J., said he would counsel a firm not to sue for fees, even with a "significant" demand like the more than $6.37 million Debevoise is seeking.

"If I were advising any law firm, I would tell them suing a client over fees is a no-win situation," he said. "It's going to get you adverse publicity you may or may not recover from. And if it went before a jury, juries hate lawyers."

Mr. Marquess said law firms usually attempt to resolve the disputes quietly to avoid litigation, which Debevoise tried to do."

Full post as published by New York Attorney Malpractice Blog on December 09, 2009 (boomark / email).