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Ostretsov v. R. Faley & R. Mortensen

December 28, 2009

VIKTOR OSTRETSOV, PLAINTIFF-RESPONDENT,
v.
R. FALEY & R. MORTENSEN, INC., T/A PARWOOD SUNOCO, DEFENDANT/THIRD-PARTY PLAINTIFF,
v.
CORPORATE BUILDING EXTERIORS, INC. AND SUNOCO, INC., THIRD-PARTY DEFENDANTS.
IN THE MATTER OF ALEXANDER FISHBEYN, ESQ., APPELLANT.



On appeal from Superior Court of New Jersey, Law Division, Bergen County, Docket No. L-1102-06.

Per curiam.

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION

Argued September 30, 2009

Before Judges Fuentes, Gilroy, and Simonelli.

This appeal concerns a fee dispute between two attorneys who represented plaintiff Viktor Ostretsov at various times in the course of prosecuting his personal injury cause of action. Appellant Alexander Fishbeyn was plaintiff's first attorney. In the original retainer agreement, plaintiff agreed to pay Fishbeyn a contingency fee of one-third of any monetary recovery he obtained from the tortfeasor. Plaintiff discharged Fishbeyn and retained respondent Rosemarie Arnold after the case was submitted to court-ordered, non-binding arbitration. The arbitrator issued a decision awarding plaintiff $140,250*fn1. Fishbeyn rejected the award and demanded that the case proceed to trial based on his professional assessment that the arbitration award undervalued the extent of plaintiff's injuries. After Arnold took over as plaintiff's counsel of record, the case settled for the gross amount of $217,500.

Fishbeyn now appeals from the order of the Law Division awarding him $13,000 in counsel fees as compensation for his representation of the plaintiff up to and including the date the case was submitted to non-binding arbitration. Although Fishbeyn concedes that he is not entitled to receive one-third of the settlement proceeds, he argues that, under the equitable doctrine of quantum meruit, he is entitled to receive at least one-third of the non-binding arbitration award. He further argues that the trial court failed to give due weight to the evidence he presented that showed the professional time and effort he invested to prepare the case for arbitration.

After reviewing the record before us, we are compelled to remand this matter to the trial court to make the specific findings and analysis required pursuant to Rule 1:7-4. In conducting this task, the trial court must articulate, with specific reference to the evidence presented, the basis for any award. We will limit our factual recitation to the issues raised in this appeal.

I.

According to his certification, plaintiff's decision to discharge Fishbeyn and retain Arnold was prompted by his dissatisfaction with the lack of progress in the case and Fishbeyn's failure to keep him informed about the status of the litigation. Specifically, the arbitration hearing took place on July 25, 2007. Although Fishbeyn appeared, plaintiff did not; in fact, plaintiff claims he was unaware that the case had even been sent to arbitration. It also seems that Fishbeyn decided to reject the arbitration award of $140,250 without first consulting with his client.

Plaintiff retained Arnold on August 17, 2007. By letter dated that same day, plaintiff notified Fishbeyn that he had retained Arnold to prosecute the case and formally requested that Fishbeyn turn over his files; Fishbeyn did not reply to this letter or comply with its request. Arnold sent a second letter dated August 20, 2007, requesting transfer of the file; Fishbeyn again did not respond.

Arnold then filed a motion in the Law Division to compel Fishbeyn to turn over plaintiff's file and seeking the imposition of sanctions for his failure to cooperate with the two previous requests for transfer.*fn2 On October 19, 2009, the court granted the relief unopposed. In his motion for reconsideration, dated November 9, 2007, Fishbeyn claimed that Arnold's notice of motion and supporting documentation was sent to a previous location where he no longer conducted business. By order filed December 12, 2007, the trial court directed Arnold to hold in escrow any monetary recovery obtained on plaintiff's behalf pending the resolution of the dispute over counsel fees.

Now in possession of Fishbeyn's file, Arnold proceeded to prepare the case for trial. She successfully moved for an extension of the discovery end date and retained Dr. Jen Lee to prepare a report documenting the extent of plaintiff's injuries. The case thereafter settled for $217,500.

Unable to agree on the amount of counsel fees each was entitled to receive, both lawyers petitioned the trial court to resolve the dispute. At a hearing scheduled for this purpose, Fishbeyn was unable to quantify the professional time he spent prosecuting plaintiff's case through arbitration. At the court's direction, Fishbeyn submitted a certification that purported to outline the nature of the services he provided and estimate the time he spent performing them.

After considering the parties' submissions and additional arguments, the court awarded Fishbeyn $14,060 and Arnold $31,630. According to the trial court, the fees awarded to Fishbeyn were based upon the amount of the proposed settlement at the time of arbitration, i.e. $140,250.00. The amount awarded to Mr. Fishbeyn is $14,060.00 [inclusive of cost] for a portion of fees based upon the $140,250.00. As no work was done by Mr. ...


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