Chodos v. Borman
227 Cal. App. 4th 76
| Cal. Ct. App. | 2014Background
- Attorney (Chodos) represented Borman in two divorce actions and a related Marvin claim without a written hourly or contingency fee agreement; he claimed an oral $1,000/hour agreement and later sought quantum meruit.
- Litigation ran from 2007–2009, included depositions and opposition to a summary judgment, and culminated in a settlement/stipulated judgment valuing client’s recovery at about $26 million.
- Attorney testified he worked ~1,800 hours (300 on first divorce, 1,500 on second divorce + Marvin) but did not keep contemporaneous daily time records.
- Jury found 1,800 reasonable hours at $1,000/hour but applied a 5x multiplier, awarding $7.8 million; trial court entered judgment after stipulated deductions.
- Client appealed, arguing the jury should not have been permitted to apply a lodestar multiplier in a quantum meruit action where the attorney did not assume contingent risk and had an initial hourly understanding.
- Court of Appeal held multipliers unjustified here, reversed, and directed entry of judgment for the $1.8 million lodestar (less agreed deductions).
Issues
| Issue | Plaintiff's Argument (Chodos) | Defendant's Argument (Borman) | Held |
|---|---|---|---|
| Whether jury could apply a lodestar multiplier in quantum meruit | Multiplier appropriate under lodestar adjustment to reflect risk, skill, and results | Multiplier improper because attorney did not assume contingent risk and had agreed hourly rate; enhancement would unjustly enrich | Multiplier improper; no legal/equitable justification where attorney did not voluntarily assume contingency risk and hourly rate already reflected skill |
| Role of contingent-risk rationale for enhancement | Enhancement compensates for contingent risk and attracts counsel | No voluntary contingency assumed; late/unexecuted contingency proposal cannot justify multiplier | Enhancement tied to contingent risk; absent voluntary contingency at outset, multiplier not warranted |
| Double‑counting extraordinary skill in multiplier | Extraordinary skill and exceptional result justify augmentation | Skill should be reflected in hourly rate; augmentation would double‑count | Extraordinary skill already encompassed in reasonable hourly rate; multiplier only for skill far exceeding comparable counsel (not present) |
| Effect of attorney’s failure to comply with written-fee statutes | Recovery should be based on reasonable value regardless of writing | Failure to comply with B&P §§ 6147/6148 means client was deprived of protections; awarding premium would reward the attorney’s statutory violations | Public‑policy and equity counsel against awarding a premium when attorney failed to comply with written fee requirements; disfavor windfall recovery |
Key Cases Cited
- Ketchum v. Moses, 24 Cal.4th 1122 (Cal. 2001) (explains lodestar as hours × rate and permits adjustments for contingent risk and other factors; warns against double counting)
- Serrano v. Priest, 20 Cal.3d 25 (Cal. 1977) (introduced lodestar adjustment method for attorney‑fee awards in public‑interest litigation)
- PLCM Group, Inc. v. Drexler, 22 Cal.4th 1084 (Cal. 2000) (endorses lodestar as starting point and permits case‑specific adjustments to reflect fair market value)
- Maglica v. Maglica, 66 Cal.App.4th 442 (Cal. Ct. App. 1998) (quantum meruit recovery measured by reasonable value of services; warns against imposing an equity‑for‑service windfall)
- Rader v. Thrasher, 57 Cal.2d 244 (Cal. 1962) (recognizes that contingent fee contracts may justify higher compensation because of gamble on result)