New York Law Review

Tag: ethical violations

  • Marin v. Constitution Realty, LLC, 28 N.Y.3d 668 (2016): Enforceability of Attorney Fee-Sharing Agreements

    Marin v. Constitution Realty, LLC, 28 N.Y.3d 668 (2016)

    Attorney fee-sharing agreements are interpreted according to their plain language, and ethical violations by one attorney do not necessarily render a fee-sharing agreement unenforceable as between the attorneys.

    Summary

    This case involved a dispute between an attorney and two other attorneys she engaged to assist with a personal injury case. The primary attorney, Menkes, had agreements with Manheimer and Golomb. Menkes argued against the fee arrangements. The court found Manheimer was entitled to 20% and Golomb to 12% of the net attorney’s fees based on the plain language of their agreements, notwithstanding Menkes’s ethical violations. The court emphasized that written contracts are to be enforced according to their unambiguous terms, and the ethical violation of failing to inform the clients of Manheimer’s role did not void the agreement between the attorneys. The decision underscores the importance of clear contract language and distinguishes between ethical breaches that impact client relations and those that affect agreements between attorneys.

    Facts

    Sheryl Menkes represented clients in a personal injury case and engaged Jeffrey Manheimer as co-counsel. Their written agreement provided Manheimer with 20% of attorney’s fees if the case settled before trial. Manheimer’s role was advisory, and he was not to contact the clients, experts, or the court without Menkes’ permission. Menkes unilaterally discharged Manheimer. Later, Menkes sought assistance from David Golomb for mediation, and they agreed Golomb would receive 12% of fees if the case resolved through mediation, or 40% if the case proceeded to trial. The mediation session did not result in a settlement that day, but a settlement was reached through subsequent communications, ten days after the mediation date. A dispute arose over the fees, with Menkes claiming Golomb was due 12% and Manheimer none, while Manheimer claimed 20% and Golomb 40%.

    Procedural History

    The Supreme Court granted motions to set Manheimer’s fee at 20% and Golomb’s fee at 40%. The Appellate Division affirmed. The New York Court of Appeals reviewed the decision, and addressed the fee-sharing agreements with Manheimer and Golomb.

    Issue(s)

    1. Whether the agreement between Menkes and Manheimer was enforceable, given that the clients were not informed of Manheimer’s involvement?

    2. Whether Golomb was entitled to 12% or 40% of the fees, based on the agreement’s language concerning mediation?

    Holding

    1. Yes, because Menkes’ failure to inform the clients did not void the agreement as between the attorneys.

    2. No, the plain language of the agreement entitled Golomb to 12% of the net attorneys’ fees because the case resolved through mediation.

    Court’s Reasoning

    The Court of Appeals emphasized that the plain language of the agreements controlled. The agreement with Manheimer was enforceable, and the ethical violation of not informing the clients of Manheimer’s involvement did not allow Menkes to avoid the agreement. The court cited prior case law holding that a party bound by the Code of Professional Responsibility cannot use an ethical violation as a way to get out of obligations of an agreement. The court also emphasized that both attorneys had failed to inform the clients of the arrangement. The court found that the agreement with Golomb clearly provided for a 12% fee if the case settled through mediation. The Court emphasized that the mediation date, “presently scheduled for May 20, 2013,” was descriptive, not limiting, and that mediation often involved more than one session. The Court determined that since a settlement was reached after the mediation, Golomb was entitled to the 12% fee as per the agreement. The Court referenced the principle of contract interpretation, which mandates that contracts must be interpreted as a whole to give effect to their general purpose.

    Practical Implications

    This case reinforces the importance of drafting clear and unambiguous attorney fee-sharing agreements. It also signals that ethical violations that impact client relations do not necessarily make an agreement between attorneys unenforceable. Attorneys should ensure their agreements are carefully worded to avoid ambiguity, particularly regarding the scope of services covered and the conditions triggering different fee percentages. The decision highlights that the court will enforce the plain language of an agreement and is likely to follow a reasonable interpretation of the agreement, emphasizing the whole agreement to construe the intent of the parties. This case stresses that attorneys must comply with ethical rules but cannot use their own ethical breaches to avoid their contractual obligations to each other.

  • Matter of Mazzei, 81 N.Y.2d 26 (1993): Judicial Conduct and Sanctions for Ethical Violations

    Matter of Mazzei, 81 N.Y.2d 26 (1993)

    Judges must be held to a higher standard of conduct than the public at large, and removal from office is an appropriate sanction for egregious ethical violations, particularly when they involve willful disregard of ethical responsibilities and undermine the integrity of the judiciary.

    Summary

    This case concerns a Town Justice, Mazzei, who faced multiple charges of misconduct, including allowing an attorney with whom he shared office space to appear before him without disclosure, neglecting his judicial duties, making inappropriate remarks about a fellow judge, permitting a private individual to make ex parte sentencing recommendations, and representing his former court clerk in a suit against the Town. The New York Court of Appeals upheld the State Commission on Judicial Conduct’s determination that Mazzei should be removed from office, finding that his conduct was egregious and demonstrated a willful disregard for his ethical obligations.

    Facts

    The Justice shared office space with an attorney who appeared before him in court without disclosing their relationship. He neglected over 100 cases for eight months. The Justice made obscene and sexist remarks about a fellow Town Justice. He allowed a private individual to sit at the bench and make ex parte sentencing recommendations, even after being cautioned against this practice. Finally, he represented his former court clerk in an action against the Town where he served as a Justice.

    Procedural History

    The State Commission on Judicial Conduct investigated the Justice’s conduct, held an evidentiary hearing, and sustained five charges of misconduct. The Commission determined that the Justice should be removed from judicial office. The New York Court of Appeals reviewed the Commission’s determination, finding it supported by a preponderance of the evidence, and accepted the determined sanction of removal.

    Issue(s)

    1. Whether the Commission’s determinations of judicial misconduct were supported by a preponderance of the evidence.
    2. Whether the sanction of removal from judicial office was appropriate given the Justice’s conduct.

    Holding

    1. Yes, because the Commission’s determinations were supported by a preponderance of the evidence presented at the hearing.
    2. Yes, because the Justice’s conduct was “truly egregious,” demonstrating a willful disregard for his ethical responsibilities and undermining the integrity of the judiciary.

    Court’s Reasoning

    The Court of Appeals emphasized that judges must be held to a higher standard of conduct than the public at large. The court noted that the Justice’s repeated disparagement of his judicial colleague undermined the dignity of the court and the judicial system. His neglect of cases, continued use of a private individual for sentencing recommendations after being cautioned against it, and representation of his former clerk in a suit against the Town, all demonstrated a deliberate evasion and violation of his ethical responsibilities. The court stated that the “ ‘truly egregious’ standard is measured with due regard to the fact that Judges must be held to a higher standard of conduct than the public at large.” Because of the multiple instances of misconduct, the Court found removal from office to be the appropriate sanction. The court found the Justice’s actions were “not merely the result of negligent oversight or lack of awareness of appropriate norms of judicial behavior. Rather, he deliberately evaded and violated his ethical responsibilities as a Judge.”