[134 NJSuper Page 222] This matter concerns the claim of a New Jersey attorney, who is also a deputy surrogate, for payment for legal services he rendered to the within estate
where a partial distribution is to be made. Petitioner was retained by the New York law firm of Wolf, Popper, Ross, Wolf & Jones, hereafter called Wolf, Popper, to represent them on a contingent fee basis. Wolf, Popper were and are attorneys-in-fact for a daughter of decedent herein, who is a beneficiary and resides in the U.S.S.R. The estate consists essentially of two parcels of real estate in Mercer County. One was taken by the State of New Jersey by condemnation which resulted in a price of $70,000 being paid for the taking. The estate was represented by another New Jersey law firm with respect to the condemnation, and certain fees were allowed by the court in this connection. The present petition is to set aside a portion of the balance remaining, to assure the payment of petitioner's claimed legal fee.
Defendant estate, now represented by still another New Jersey law firm which was substituted for petitioner, contends that petitioner was discharged for failure to properly pursue this matter and that no fee is due to him. Petitioner argues that a contingent fee agreement, whereby he was retained, entitles him to a percentage of the total estate and that the substitution of new counsel is an invasion and denial of his vested contractual rights.
The factual situation is somewhat complex respecting the dealings of petitioner and Wolf, Popper. Suffice it to say that petitioner had embarked on the work involved and had determined that decedent's widower was still alive and entitled to a life interest in the estate which will require waiting until that interest is extinguished before final settlement of the account. The life tenant is advanced in age but apparently still survives to this date. Petitioner claims that this was well understood by Wolf, Popper and that therefore he was not required to perform any additional services for the estate. Wolf, Popper had learned that because of his position as deputy Surrogate petitioner was unable to make any court appearances for them. Nevertheless, they made certain inquiries about the progress of petitioner
and, on failure to receive a response to their inquiries, discharged petitioner as attorney on a date which this court determines to be July 6, 1972.
The real question is, does an attorney in New Jersey have a vested right in the contractual relationship with a client arising out of a contingent fee agreement, and most particularly, where the services have not been completed?
No exact precedent is found in our New Jersey cases. In Stein v. Shaw, 6 N.J. 525 (1951), a disbarred attorney was involved and the holding of that case must be understood in that setting. In Niebuhr v. Sassadeck, 15 N.J. Misc. 285, 190 A. 783, aff'd 120 N.J.L. 183 (E. & A. 1938), the attorney's services were nearly complete on his discharge, and therefore quantum meruit was held not to be applicable in determining the amount of the fee.
The answer to this question may be partly learned from In re Kish, 52 N.J. 454 (1968). Not only is the subject matter of the cited case very similar, but the firm of Wolf, Popper was also involved as attorneys-in-fact for an estate where the beneficiaries were from Hungary. In an opinion by Justice Hall the court had occasion to pass on the question of the propriety of a contingent fee for the attorney for the estate, and stated:
In view of a court's inherent power to pass upon the reasonableness of fees charged in connection with any matter before it, any fee arrangement set forth in such a power of attorney is subject to judicial review. A court should make inquiry in these situations as to the existence of any such percentage arrangement, since the client is in a foreign country, is bound to be unfamiliar with appropriate fees and charges here, and cannot personally be heard. While the amount the specified percentage would produce in this case does not appear unreasonable in light of the extended litigation, the figure seems clearly excessive as far as future matters are concerned since, by reason of the criteria and procedure we have outlined adversary litigation will not ordinarily be required.
The proper practice is for the New Jersey attorney to apply to the court, pursuant to R.R. 4:107-3, for an allowance out of the distributee's share for his services and those of any out-of-state attorney, plus their expenses, based on the nature and extent of the ...