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Mills v. Marquard & Associates6/10/2003
In its dispute with a former associate attorney over the distribution of a contingency fee, appellant law firm Marquard & Associates appeals from summary judgment, arguing that the district court erred when it ruled that (1) pursuant to an employment agreement appellant was entitled to 50 percent of the contingency fee and (2) the employment agreement between the firm and the associate is enforceable. We affirm.
FACTS
When appellant Marquard & Associates (Marquard) hired respondent Michael Mills as an attorney on January 15, 1999, Mills signed an employment agreement. The agreement was modified on February 1, 2000, but the changes did not affect the portions of the agreement that pertain to this case. In relevant part, the employment agreement provides:
Employee understands and agrees that all clients shall be and shall remain clients of the firm (Employer) even subsequent to Employee's departure, should Employee leave Employer's employment. At such time as Employee's employment terminates with Employer, Employee shall provide Employer with a list of all clients serviced by Employee. Regardless of the reason for Employee's departure, all files shall remain with the Employer and Employee agrees to make no contact with any client at any time regarding the performance of any legal services for such client subsequent to Employee's departure. In recognition of the fact that it is the client's right to choose what person or firm performs client's legal services the parties hereto agree that a written notice shall be sent to clients whose files were being primarily handled by Employee stating that Employee has left the employment of Employer and that the client's file has been assigned to a different attorney who will handle client's file unless written instructions to the contrary are received from the client. The form and contents of such notice shall be left to the sole discretion of Employer.
To streamline and expedite the transitional process Employee agrees in the event Employee departs [from] Employer's employment to provide a detailed written memorandum setting out the status of each matter then receiving Employee's attention, outlining as well anticipated future activity required on each of said files along with such other information as is reasonably necessary and appropriate to enable Employer to promptly and expeditiously undertake any further action which may be necessary and in a client's interest.
As to clients who direct their matters be turned over to Employee for his continued attention after Employee's departure, fees generated for work performed prior to Employee's departure shall be the sole property of Employer. If the matter is a contingency fee case and any client directs that their matters be turned over to the Employee for his continued attention after Employee's departure then Employee shall be obligated to pay Employer the following:
A sum calculated by multiplying the contingent fee received by such Employee by fifty per cent (50%) as to each part or facet of the contingent fee case in which such employee is involved in representing such client and receives a fee as a contingent fee case from such representation.
Unless waived by Employer in writing, Employee or client shall be obligated to reimburse Employer for all out-of-pocket disbursements made by Employer on behalf of the client prior to or at the time the client's file is turned over to Employee[.]
(Emphasis added).
Harold and Carol Preble were involved in an accident in August 1999. They retained Marquard to represent them in their personal-injury matter. Harold Preble signed a retainer agreement wi
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