239 So. 3d 1057
La. Ct. App.2018Background
- Sileo (attorney) represented Deborah and Mark Kruse in a Mesh MDL federal case; a contingency-fee contract (Sept. 23, 2012) with Deborah provided for 40–50% contingent fees and stated attorney retains fees if discharged.
- The Kruses discharged Sileo by written notice on Feb. 9, 2015; successor counsel Berger substituted on Feb. 24, 2015.
- After discharge, Sileo did not timely record the contingency contract under La. R.S. 37:218, did not successfully file a timely petition of intervention in the MDL before settlement, and failed to notify Berger of its claimed interest prior to settlement.
- The MDL case was settled and dismissed with prejudice on May 31, 2016; Sileo later recorded the contract (Sept. 9, 2015) and ultimately sued (Oct. 24, 2016) the Kruses and Berger for fees and conversion.
- Defendants raised exceptions of lack of subject-matter jurisdiction, no right of action, prescription, and res judicata; the trial court granted all exceptions and dismissed Sileo with prejudice.
- On appeal the court affirmed dismissal on the ground Sileo had no right of action because he failed to protect his interest (no timely La. R.S. 37:218 filing or effective intervention/notice), rendering other exceptions moot.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| No right of action against former clients (Kruses) | Sileo argues he is entitled to fees under the contingency contract despite not recording it before settlement. | Kruses argue Sileo forfeited rights by failing to record under La. R.S. 37:218 and took no timely action to preserve his interest. | Court: No right of action — Sileo forfeited recovery against clients for failing to timely record or otherwise protect interest. |
| No right of action against successor counsel (Berger) | Sileo contends successor counsel wrongfully obtained settlement funds and Berger should account for fees. | Berger argues Sileo failed to give pre-settlement notice (intervention or other) and thus cannot recover. | Court: No right of action — Sileo did not timely notify or intervene; forfeited claim against successor counsel. |
| Subject-matter jurisdiction (declinatory) | Sileo asserted federal matters/MDL-related rights justify jurisdiction. | Defendants argued lack of jurisdiction for Sileo’s state-law suit or procedural defects. | Court: Not reached — dismissed on no-right-of-action ground (other exceptions moot). |
| Prescription / Res judicata | Sileo argued claims timely and not barred. | Defendants argued claims prescribed and/or precluded by final MDL dismissal. | Court: Not reached — disposition on no-right-of-action; other exceptions moot. |
Key Cases Cited
- Ferguson v. W. Jefferson Levee Dist. Bd. of Comm'rs, 685 So.2d 273 (La. App. 5th Cir. 1996) (discharged attorney who fails to record contract or timely intervene forfeits claim against client; possible claim against successor only if timely notice given)
- Ferguson v. W. Jefferson Levee Dist. Bd. of Comm'rs, 688 So.2d 486 (La. 1997) (Supreme Court granted review in part and remanded on successor-attorney issues for reconsideration)
- O'Rourke v. Cairns, 683 So.2d 697 (La. 1996) (allocation of contingency fees when attorney discharged for cause; apply Saucier/Saucier factors and reduce award for cause)
- Rush, Rush & Calogero v. Barrios, 716 So.2d 23 (La. App. 3d Cir. 1998) (Third Circuit held non-recorded contingency agreement enforceable against client; distinguished by notice/intervention facts)
- Murray, Murray, Ellis, Braden & Landry v. Minge, 516 So.2d 213 (La. App. 4th Cir. 1987) (successor counsel acknowledged prior attorney's fee claim; sufficient notice upheld recovery against successor)
- Reis v. Fenasci & Smith, 635 So.2d 1319 (La. App. 4th Cir. 1994) (attorney who failed to record contract and failed to give requisite notice to successor attorney failed to state cause of action against successor)