This is an application under R. 1:21-7(f) for approval of attorneys' fees in excess of the contingent fees allowable under R. 1:21-7(c)(7).
The issues involved are: first, whether the contingent-fee schedule promulgated by the Supreme Court applies to a lawsuit against an insurance carrier to obtain excess coverage; second, if so, is an attorney representing an injured claimant entitled to attorneys fees in excess of the contingent-fee schedule for "defending" a subsequent action where the primary relief sought is by the injured claimant against the insurance carrier by means of a cross-claim; and third, whether a fee in excess of the contingent-fee schedule is warranted.
The court holds that the contingent-fee schedule applies, that the attorneys are not entitled to additional legal fees for defending an action to stay execution of their judgment, but are entitled to additional legal fees.
Procedural History of Underlying Case
A personal injury action entitled, Nicholas Marone, III, by and through his guardian ad litem, Florence Marone and Florence Marone, individually v. Nicholas Marone, Jr., Shirley Dillon and Peter J. Dillon, was tried before a jury, which resulted in a judgment of $180,000 ($160,000 to Nicholas Marone, III, then a minor, and $20,000 to his mother) against Shirley Dillon and Peter J. Dillon. The case of Nicholas Marone, III against his father, Nicholas Marone, Jr., was settled for $15,000 just before this trial began. This judgment ($150,000 in excess of the Dillons' available bodily-injury liability-insurance limits under policies issued by Allstate Insurance Company) was affirmed by the Appellate Division. There was a stay of execution granted which continued until a petition for certification
was denied January 25, 1983. However, the $30,000-policy limit was not paid until long thereafter.
Causes of Action Pleaded in This Action
Plaintiffs, Shirley Dillon and Peter J. Dillon filed a complaint against Allstate, Nicholas Marone, III, and Florence G. Marone which contained four counts against Allstate for reckless, careless and negligent conduct, breach of contract and bad faith, seeking compensatory and punitive damages and to compel Allstate to satisfy the judgment against the Dillons entered in favor of the Marones. One count of the complaint against the Marones sought to restrain them from executing on their judgment.
Defendants Marone filed a cross-claim against defendant, Allstate, alleging "bad faith, reckless, careless and negligent conduct and breach of contract," demanding judgment against defendant, Allstate, in an amount equal to the excess unsatisfied portion of the judgment including postjudgment interest, punitive damages and attorneys' fees. The cross-claim was basically for relief pursuant to Rova Farms Resort v. Investors Ins. Co., 124 N.J. Super. 248 (App.Div.1973), mod. 65 N.J. 474 (1974).
The attorneys for the Marones made a motion for summary judgment for postjudgment interest against Allstate, which motion was granted resulting in a partial summary judgment of $49,088.80, which Allstate appealed. However, the appeal was withdrawn when the matter was settled.
This lawsuit was settled by Allstate by paying $100,000 to the Marones, at which time Nicholas Marone, III was 19 years old. This settlement obviously included some postjudgment interest, which may be considered in determining legal fees. Iskander v. Columbia Cement Co., 192 N.J. Super. 114 (Law Div.1983).