Solve & Win announces that a non-litigator attorney prevails in breach-of-contract case against litigator over referral fees

USA - English

• USA - English

LOS ANGELES, Aug. 4, 2021 /PRNewswire-PRWeb/ -- Business transactional attorney-entrepreneur Suzanne Natbony, president of Solve & Win PC, has won a judgment against Benjamin Reccius, an associate attorney at Kimball, Tirey, St. John LLP over a breach of contract regarding referral fees.

Heard by Judge Emma Castro of the Los Angeles Superior Court, Suzanne Natbony v. Benjamin Reccius et al. (2021) Cal. Sup. 21STSC00537 hinged on whether a referral fee Reccius promised Natbony was enforceable under the California Lawyer Professional Rule of Conduct 2-200 and case law. Natbony was awarded the $9,000 fee entitled to her plus costs.

"How can an officer of the court who is charged with creating and enforcing contracts for the people not be held to the contracts that he himself makes?" said Natbony. "I am not a litigator and the amount at stake wasn't that much, but it's the principle."

In Natbony, plaintiff Natbony referred a landlord/tenant matter to defendant Reccius, who agreed to take the case on a contingency basis, pay Natbony a referral fee of 25 percent of the fees earned on the matter, and include written disclosure of the fee division in his retainer agreement. The amount of the referral fee was confirmed in an email, and Reccius advised Natbony that he had included the required Rule 2-200 language in the client's retainer agreement and that he had signed it.

Under these facts, Natbony had no reason to doubt Reccius' representations as to compliance with Rule 2-200, which permits referrals fees paid between lawyers if two factors are met: The client must agree to the fee in writing and the legal fees may not be increased due to the referral.

California permits lawyers to pay and receive referral fees under the current Rule 1.5.1 and the "old rules," which were in effect when the Natbony referral was made. Accordingly, in Natbony, Rule 2-200 was the operative rule.

While most California lawyers understand that lawyers can make or pay referral fees if both factors are met, these lawyers are actually unaware of the case law providing for an exception. In Barnes, Crosby, Fitzgerald & Zeman, LLP v. Ringler (2012) 212 Cal.App.4th 172, the court of appeal held that when a referring attorney is prevented from complying with Rule 2-200 by the attorney to whom she referred the client, the defendant attorney is equitably estopped from asserting Rule 2-200 "as a 'sword' to escape a written referral fee agreement."

The Barnes Court held that the record demonstrated that the defendant had actively prevented plaintiff from complying with Rule 2-200 in obtaining written authorization from the client for the fee division. Id. at 175.

Like the defendant in Barnes, supra, the Natbony ruling equitably estopped Reccius from asserting non-compliance with Rule 2-200 as a defense to his fee-sharing agreement with Natbony.

Pleased with the judgment, Natbony explains that her focus is "preventive legal," i.e., advising clients about regulations, protecting intellectual property, and drafting and negotiating contracts, but she also has to put out fires.

"This was a fire that couldn't be contained," Natbony said. "No amount of reasoning, demands letters, offers to settle or mediate, or mutual-connection influences were able to induce even a $1 settlement.

"So in that case, you have to do what litigators do and file a lawsuit when you have the facts and law on your side."

Suzanne Natbony is a third-generation lawyer, with a focus on business transactional, regulatory/compliance and dispute resolution. She is licensed to practice in California, with her own law practice, Solve & Win, in West Los Angeles, in addition to being a Partner at the international law firm, Aliant LLP (AliantLaw.com) and Of Counsel to Merino Yebri LLP (MYlawLLP.com), in Century City, and she also serves as General Counsel for Beverly Hills Rejuvenation Center, a multi-state medical spa franchise (BHRCenter.com). Solve & Win is a solutions-oriented law firm comprised of practical, business-minded corporate lawyers, who are effective at closing deals, and creatively overcome legal obstacles through resolving disputes. Ms. Natbony is also founder and CEO of LawTake, the first online marketplace for lawyers to successfully commoditize legal information via videos and forms directly to consumers.

Media Contact

Suzanne Natbony, Solve & Win, PC, +1 3104786251, [email protected]

Suzanne Natbony, Solve & Win, PC, [email protected]

SOURCE Solve & Win