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Campbell v. Bozeman Investors of Duluth8/24/1998
organ are entitled to attorney fees totaling $8800.
21 The District Court concluded that a client's right to discharge an attorney employed under a contingency fee contract is an implicit term of the contract and the client's discharge of the attorney, with or without cause, does not constitute a breach of that contract. The court further concluded that a client who discharges an attorney employed under a contingency fee contract for cause has no obligation to pay a fee to that attorney unless the attorney has substantially performed the services for which he was retained.
22 On that basis, the court determined that Campbell had not breached the contract by discharging Hartelius and Morgan. Moreover, the court determined that although Hartelius and Morgan were discharged for cause, they substantially performed the services for which they were retained prior to their discharge. Therefore, they were entitled to a fee limited to the reasonable value of their services. Thus, the court awarded $6600 to Hartelius and $2200 to Morgan.
23 The standard of review of a district court's conclusions of law is whether the court's interpretation of the law is correct. Carbon County v. Union Reserve Coal Co. Inc. (1995), 271 Mont. 459, 469, 898 P.2d 680, 686. See also Kreger v. Francis (1995), 271 Mont. 444, 447, 898 P.2d 672, 674; Steer, Inc. v. Department of Revenue (1990), 245 Mont. 470, 474-75, 803 P.2d 601, 603-04.
24 First, we must determine whether, as Hartelius and Morgan contend, a client's discharge of his or her attorney is a breach of contract thus entitling the attorney to contract damages. We hold that it is not and does not.
25 In 1916, the New York Court of Appeals held that a contract under which an attorney is employed by a client has peculiar and distinctive features which differentiate it from ordinary contracts of employment, thus a client may, at any time for any reason or without any reason, discharge his or her attorney. Martin v. Camp (N.Y. 1916), 114 N.E. 46, 47-48, modified 115 N.E. 1044. Thus, the court reasoned that if the client has the right to terminate the relationship of attorney and client at any time without cause, the client cannot be compelled to pay damages for exercising a right which is an implied condition of the contract. Martin, 114 N.E. at 48. The court held that although the attorney may not recover damages for breach of contract, the attorney may recover the reasonable value of the services rendered. Martin, 114 N.E. at 48.
26 A majority of jurisdictions have since adopted the "client discharge rule" as set forth in Martin. (For a list of these jurisdictions, see Lester Brickman, Setting the Fee when the Client Discharges a Contingent Fee Attorney (Spring 1992), 41 Emory L.J. 367 n.37.) One such jurisdiction noted:
The attorney-client relationship is one of special trust and confidence. The client must rely entirely on the good faith efforts of the attorney in representing his interests. This reliance requires that the client have complete confidence in the integrity and ability of the attorney and that absolute fairness and candor characterize all dealings between them. These considerations dictate that clients be given greater freedom to change legal representatives than might be tolerated in other employment relationships.
Rosenberg v. Levin (Fla. 1982), 409 So.2d 1016, 1021. Another jurisdiction stated the following regarding the payment of damages for exercising the right to discharge an attorney:
To allow an attorney to recover damages for services not actually rendered prior to termination of the attorney-client relationship would p
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