Olsen v. Harbison: Litigation Privilege Bars Fee Claim by One Co-counsel Against the Other

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The California Court of Appeal has published another decision pertaining to the division of fees between attorneys who jointly represent a client. On this occasion, the Court of Appeal held that one of the attorneys was not required to share the fee with the other attorney who had been fired by the client.

A client retained an attorney to represent her in a personal injury action. After filing the action, the attorney engaged another lawyer to help him prosecute the case. The client signed a fee agreement acknowledging the agreement between the attorneys as to how they would split the fees. Shortly thereafter, the client fired her initial lawyer. The second lawyer prosecuted the case to a settlement of $775,000, whereupon the initial lawyer sued his former co-counsel for his share of the fees.

The trial court rejected each theory alleged by the aggrieved attorney, which included quantum meruit, breach of contract, fraud and deceit, intentional interference with contractual relationship and imposition of constructive trust. In an opinion ordered published on December 28, 2010, the California Court of Appeal (Third Appellate District) affirmed in all respects. Olsen v. Harbison, 10 C.D.O.S. 16041.

As to the quantum meruit claim, the Court of Appeal held that any such claim should have been brought against the client, as the services at issue were rendered to the client, not the co-counsel. Although there have been cases approving a quantum meruit action between co-counsel, that was in situations in which the client had not approved the fee agreement. When the client had in effect a direct relationship with both lawyers and had approved their fee agreement, a claim for quantum meruit must be directed against the client.

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