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Pires v. Frota Oceanica Brasileira1/14/2005
Published by New York State Law Reporting Bureau pursuant to Judiciary Law ยง 431.
This opinion is uncorrected and will not be published in the printed Official Reports.
Motion sequence 38 under Index No. 23829/76 and Motion sequence 01 under Index No.: 114298/04 are consolidated for disposition in this decision and order.
Motion sequence 38: Saul Rudes' motion, brought in the action S.M. Pires v Frota Oceanica Brasileira, Index No. 23829/76 ("underlying action"), seeks an order directing Kenneth Heller to deposit attorneys' fees in the amount of $4,176,539.54 into an interest bearing account at a New York City bank in the names Kenneth Heller and Saul Rudes which amount cannot be withdrawn without court order and for an order determining the amount of counsel fees to which Saul Rudes is entitled due to his status as co-counsel to Mr Heller in this maintenance and cure action.
Kenneth Heller cross-moves for an order dismissing the motion. Mr Heller argues that Mr Rudes waived his right to legal fees on the record before Referee Julius Birnbaum and has failed to produce evidence that he is entitled to attorneys' fees. Mr Heller has produced an affirmation from Julius Birnbaum stating that Mr Rudes waived his right to a charging lien with prejudice. Mr Heller also argues, inter alia, that the claim for attorney's fees is barred by laches, that the $4,176,539.54 was a voluntary advance from Mr Pires for unpaid legal fees, and that he had an agreement with Mr Pires which called for repayment of that amount upon the final determination of attorneys' fees. Mr Heller does not address the merits of the motion or the claims that he fraudulently induced Mr Rudes to waive the charging lien by claiming that the money he received was going directly to Mr Pires. This motion was originally returnable on September 8, 2004. On September 23, 2004, Justice Richard Lowe reassigned the action to a non-commercial part. The action and motion were assigned to Justice Edward Lehner who recused himself and then to Justice Shirley Kornreich who recused herself. Thereafter, the action motion were reassigned to this Court.
This action has a long procedural history. On June 27, 1997, The Appellate Division, First Department in Pires v Frota Oceanica Brasileira et al, 240 AD2d 323 [1st Dept 1997]), inter alia, remanded the action to the trial court for an award of attorney's fees. On November 27, 2001, the Appellate Division, First Department, reversed the trial court's award of attorney's fees in the amount of $5.4 million dollars, plus interest, to plaintiff's counsel and vacated the judgment and remanded the matter to determine the amount of counsel fees for which plaintiffs were obligated to counsel. The Court directed judgment in favor of plaintiffs, payable by defendant directly to plaintiffs "and not to counsel" the amount of counsel fees charged to plaintiffs and "presumably already paid."(288 AD2d 126,127 [1st Dept 2001]). On May 4, 2004, the issue of attorneys' fees in the underlying action was again addressed in a decision of the Appellate Division, First Department., 7 AD3d 270 [1st Dept 2004]). The Court denied plaintiff's appeal of Justice Herman Cahn's referral of the issue of attorney's fees to a referee stating that the amount of fees owed by plaintiff to his then counsel Kenneth Heller could not be determined without a fact finding process. (Id at 271). The Court noted that plaintiff failed to include a copy of the retainer agreement in the record on appeal. Thus, at present, the issue of the amount of attorneys' fees is awaiting an order referring the matter to a referee.
Prior to the action and motion being assigned to this Court, plaintiff S.M. Pire
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