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Eichen, Levinson & Crutchlow, LLP v. Weiner

January 15, 2008

EICHEN, LEVINSON & CRUTCHLOW, LLP, PLAINTIFFS-APPELLANTS,
v.
A. KENNETH WEINER, DEFENDANT, AND DARREN M. GELBER, ESQ. AS ATTORNEY-TRUSTEE FOR A. KENNETH WEINER, DEFENDANT/INTERVENOR-RESPONDENT.



On appeal from Superior Court of New Jersey, Law Division, Middlesex County, Docket No. L-6325-06.

The opinion of the court was delivered by: Baxter, J.A.D.

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION

APPROVED FOR PUBLICATION

Argued December 17, 2007

Before Judges S.L. Reisner, Gilroy and Baxter.

This appeal centers upon the interpretation of Rule 1:20-20(b)(13). Specifically, we are called upon to decide whether an attorney-trustee who has been appointed by the court to oversee a suspended or disbarred attorney's law practice is entitled to take possession of referral fees that would otherwise be due to the suspended or disbarred attorney pursuant to a referral agreement, or whether instead the law firm responsible for paying the referral fees is entitled to retain them. We conclude that the Law Division correctly determined that the referral fees should be paid to the attorney-trustee, to be held in trust pending further direction from the court on the ultimate distribution of those funds.

I.

A. Kenneth Weiner was a practitioner in East Brunswick whose practice included plaintiffs' personal injury, petitioners' workers compensation and criminal matters. On February 2, 2004, Weiner referred seventy-eight personal injury files to the law firm of Eichen, Levinson & Crutchlow, LLP ("Eichen firm" or "the firm"). The partners in the Eichen firm are certified civil trial attorneys, in accordance with Rule 1:39-5. By order dated July 27, 2004, Weiner was temporarily suspended from the practice of law. His suspension was effective immediately and until further order of the Court. On August 2, 2004, the Law Division entered an order appointing Darren M. Gelber, of Wilentz, Goldman & Spitzer, P.A., as attorney-trustee pursuant to Rule 1:20-19.*fn1 That rule allows the court to appoint an attorney-trustee to take possession of a suspended lawyer's practice for the benefit of the lawyer's clients and creditors. The court directed the attorney-trustee to "take all actions necessary to fulfill the requirements of R. 1:20-19." After two additional temporary orders of suspension were issued, Weiner was ultimately disbarred on October 12, 2006.

During the period of Weiner's suspension, the Eichen firm resolved the seventy-eight matters that Weiner had referred in February 2004. As of August 2006, the firm was holding $81,934 in escrow, which represented costs and fees that would have been due to Weiner pursuant to the referral agreement had he not been suspended.

On August 16, 2006, the Eichen firm filed a verified complaint alleging the following: (1) it was maintaining the $81,934 in its trust account; (2) Weiner was disqualified from earning legal fees after the date of his disbarrment;*fn2 and (3) any fees to which Weiner might be entitled prior to his suspension or disbarrment must be supported by a quantum meruit certification attesting to the services performed prior to suspension. The Eichen firm sought an order compelling Weiner to either file a quantum meruit certification, or be deemed to have forfeited all fees and costs to the Eichen firm.

After the complaint was filed, the Law Division entered an order permitting the attorney-trustee to intervene as a party defendant. The trustee alleged that he was entitled to take possession of the disputed referral fees pursuant to Rule 1:20-20(b)(13) and Rule 1:20-19.

At oral argument before the Law Division, the Eichen firm argued the following: (1) Weiner's failure to file a quantum meruit certification should result in forfeiture of his right to receive any referral fees; (2) Weiner's failure to file a certification attesting to his compliance with the procedures enumerated in Rule 1:20-20(b)(1) to (14) also disqualified him from receiving any referral fees; and (3) because the trustee stands in the shoes of the disqualified attorney, the trustee is not entitled to take possession of any referral fees due to Weiner's failure to submit the two required certifications.

In reply to the firm's arguments, the trustee contended that Weiner's law practice was entitled to payment of the referral fees regardless of whether Weiner submitted the quantum meruit certification or a certification of compliance with the requirements of Rule 1:20-20(b). The trustee further argued that if the contentions presented by the Eichen firm were accepted, the Eichen firm would obtain a windfall, and the trustee would be deprived of funds owed to Weiner's creditors and former clients.

In a written opinion of January 18, 2007, and a confirming order on February 14, 2007, Judge Longhi rejected the position advanced by the Eichen firm and directed the firm to transfer the $81,934 to the trustee "as if A. Kenneth Weiner continued to be engaged in the active practice of law and without regard to the fact that he has been suspended and disbarred." That ...


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