Wednesday, April 25, 2018
Page 1
Retainer Agreement Applicable to Particular Matter Can Be Orally Modified to Apply to All Cases—C.A.
Arbitration Clause in a 2005 Agreement Held Applicable to Legal Representation In All Cases That Followed; Client’s Failure to Pay Causes Liability to Burgeon
By a MetNews Staff Writer
An attorney-client agreement, applicable to a particular dispute, can be orally modified to pertain to all future representation, the Court of Appeal for this district held yesterday, affirming the granting of a motion to compel arbitration pursuant to a provision of the agreement.
Justice Anne H. Egerton of Div. Three wrote the opinion, affirming the decisions by Los Angeles Superior Court Judge Terry Green to send the case to arbitration and, following the arbitration, awarding attorney fees to the plaintiff.
The plaintiff in the case is Los Angeles attorney Ronald S. Caswell, a founding partner of Caswell & Cannon. He sued thoroughbred owner Jerry Jamgotchian for $76,346.54 in unpaid fees based on representation in 11 matters.
Arbitration Provision
In moving to compel arbitration, Caswell relied upon a retainer agreement Jamgotchian signed on Dec. 14, 2005, providing:
“[S]hould any fee dispute arise between us, we mutually agree that such dispute will be subjected to binding arbitration in Los Angeles, California, pursuant to the JAMS/Endispute arbitration program, and that the arbitrator may award reasonable attorneys’ fees to the prevailing party in such proceedings. YOU ACKNOWLEDGE THAT YOU ARE AWARE OF THE FACT THAT BY AGREEING TO ARBITRATION, YOU WAIVE ANY RIGHT YOU HAVE TO A COURT OR JURY TRIAL.”
Green found that when a second matter came up, Jamgotchian “refused to sign...the second retainer agreement” and said: “Let’s make the first one be our retainer.” The judge concluded that “all parties then wanted the initial agreement to cover all future litigation that Mr. Jamgotchian brought, as the client, to Mr. Caswell.”
Arbitrator’s Award
The arbitrator awarded Caswell $78,154.49 in damages, $28,154.15 in prejudgment interest, $126,406.25 in attorney fees he expended in retaining outside counsel, and $36,681.57 in arbitration costs, totaling $269,396.46.
Green confirmed the arbitrator’s award, adding $11,217.60 in prejudgment interest, bringing the total; to $280,614.60. He also awarded $133,362.50 in fees Caswell paid to attorney Kyle P. Kelley in the trial court, plus $3,417.28 in costs.
Egerton wrote:
“On appeal, Jamgotchian does not dispute outright the trial court’s conclusion that he and Caswell orally agreed to modify the original retainer agreement so that its terms, including the arbitration clause, would apply to all subsequent representation by Caswell. Instead, he argues that written agreements to arbitrate may not be orally modified, and recharacterizes the court’s finding as concluding that the arbitration clause, rather than the retainer agreement, was orally modified.”
Rejecting the contention, she said:
“When Jamgotchian and Caswell orally modified the original retainer agreement so that it would apply to all subsequent representation by Caswell, they did not modify the arbitration clause. That clause remained identical in the second retainer agreement that Jamgotchian refused to sign in favor of applying the original retainer agreement to subsequent cases. Caswell and Jamgotchian orally agreed to modify not the arbitration clause, but ‘the overall contract in which that agreement to arbitrate is contained.’…That clause remained identical in the second retainer agreement that Jamgotchian refused to sign in favor of applying the original retainer agreement to subsequent cases. The unmodified written arbitration clause, as part of the retainer agreement, thus applied to ‘any fee dispute’ in subsequent cases.”
There was a remand to Green for a determination of attorney fees in connection with the appeal.
The case is Caswell v. Jamgotchian, B271389.
Copyright 2018, Metropolitan News Company