How much is too much?
Is an hourly attorney fee of $48,000.00 reasonable? Former Chief of the Texas Supreme Court thinks so (or is at least being paid to say so) and has already convinced the Dallas Court of Appeals to accept the proposition that reasonableness in compensation knows no limits when it comes to attorney’s fees. See Shamoun & Norman, LLP v. Hill, 483 S.W.3d 767 (Tex. App.-Dallas 2016, pet. pending).
To be sure, the intermediate appellate court didn’t put it quite that way. But it reinstated a jury's verdict for in $7,250,000 in attorney’s fees for “settlement services” involving high-stakes litigation over inherited wealth involving dozens of lawyers and various venues. The hitch: There was no contract for the lawyer to take such a large cut of the bounty.
Now the same argument is being pitched to the Texas Supreme Court. The current team of lawyers for Hill, the client being tapped for the multi-million dollar amount in attorney’s fees by his former counsel is crying foul, and three amicus briefs, including one by AG Paxton filed on behalf of the State of Texas, have joined the chorus.
The crux of the matter is that a contingent fee agreement must be in writing and signed by both parties, and there was no such agreement between Hill and his former attorney.
Albert G. Hill Jr. did sign legal services agreements with attorney Gregory Shamoun and SHAMOUN & NORMAN, LLP (a solo lawfirm all but in name) and paid ca $1 million in fees for work he was billed for, but got sued by Shamoun after settlement for a multiple of the billed fee amount as a “bonus” for what Shamoun calls “global settlement services."
According to Shamoun’s own evidence, he spent somewhere between 100 and 150 hours on the matter, but claimed that the value of his services was no less than $7,250,000. Shamoun persuaded a Dallas County jury that he was entitled to that amount on an alternative theory (quantum meruit) in the absence of a contingency fee contract compliant with the statute of frauds.
To his credit, the trial judge threw out the fee award verdict after the jury delivered it, but the Dallas Court of Appeals reinstated it, at the urging of former Texas Supreme Court Justice Wallace B. Jefferson.
Now, Shamoun is getting an opportunity to sway the Texas Supreme Court to gut the statute of frauds applicable to contingent fee contracts by permitting attorneys to recover success-based claims for windfall fees calculated as a percentage of the amount recovered for the client (or saved) which would be barred by the statute in the absence of a written contract signed by the client.
The Texas highest court for civil cases is being urged to bless such claims under a revamped common-law theory known as quantum meruit (literally meaning “as much as is deserved”).
And the former chief is pitching it to them: The proposition that 100-150 hours of work justifies an award of $7,250,000, which comes out to a whopping $48,000 per hour.
The parties briefs can be viewed by following the hotlinks on the Texas Supreme Court’s docket for Hill v Shamoun.