Law Firm Ordered To Pay Opponent Additional Fees for Disputing Settlement Wording
Two Cleveland law firms could not agree on the wording of a settlement ordered by the Supreme Court of Ohio. That quarrel led to a hearing in Columbus and an additional $2,600 payment to a lawyer for preparing for and attending the meeting.
In a 5-2 per curiam opinion, the Supreme Court ordered three attorneys with Stafford Law to pay opposing attorney Jill Friedman Helfman $2,600 for participating in a sanctions hearing. The payment was in addition to the $10,751 in legal fees paid to Helfman to settle the dispute.
Chief Justice Sharon L. Kennedy and Justices Patrick F. Fischer, R. Patrick DeWine, Michael P. Donnelly, and Joseph T. Deters joined the per curiam opinion. The majority found the Stafford Law attorneys’ refusal to accept the wording of a stipulated agreement caused the hearing.
In a dissenting opinion, Justice Melody Stewart wrote that both sides could be blamed for the hearing. She wrote that the additional $2,600 payment was unwarranted. Justice Jennifer Brunner joined Justice Stewart’s dissent.
Attorneys in Bitter Divorce Case Clash
Helfman and Stafford lawyers Joseph Stafford, Nicole Cruz, and Kelly Tauring represent a former Cuyahoga County couple locked in a protracted divorce dispute. In November 2023, the Supreme Court ruled the Stafford attorneys filed a frivolous appeal in the case, and the Court declared the three lawyers to be vexatious litigators.
The Court ordered the Stafford attorneys to pay Helfman for her reasonable attorney fees. The amount to be paid would be determined after a hearing conducted by a Court master commissioner.
In H.R. v. P.J.E., the Court ruled the Stafford lawyers filed an appeal on behalf of their client, identified as “H.R.,” that was neither warranted nor supported by a good-faith argument. The Court noted the law firm made the same flawed argument in other cases and determined the attorneys were vexatious litigators.
A master commissioner scheduled a hearing for the purpose of recommending an amount of fees the Court should order the Stafford lawyers to pay to Helfman and others who worked on behalf of her client, “P.J.E.” Before the hearing took place, the parties agreed to a $10,751 settlement.
Settlement Statements Refused
After settling, the Stafford lawyers sought to end the dispute by asking the Court to dismiss the case. The Court rejected the request, noting the parties had not disclosed the settlement amount.
In March 2024, the Court issued an order that the lawyers could avoid a sanctions hearing in Columbus if they “submit an agreed stipulation setting forth the stipulated amount of reasonable fees incurred by appellee and to be paid by Joseph G. Stafford as a result of the Stafford Law Co. L.P.A.’s frivolous appeal to this court.”
Helfman provided the Stafford lawyers with a proposed stipulation that quoted the Court’s order and included the $10,751 settlement amount. The Stafford lawyers rejected the stipulation because it used the phrases “frivolous conduct” and “reasonable fees,” which appeared in the Court’s order. Helfman sent another proposal that only stated the fees were “reasonable.” That was also rejected.
When the parties could not agree, the Stafford lawyers asked the Court to dispose of the case by accepting a “motion to accept settlement agreement,” which did not include the amount paid to Helfman. The Court rejected the request, and the matter proceeded to a sanctions hearing.
Sanctions Hearing Ensued
At the sanctions hearing, Helfman submitted the settlement statement and then presented a second request for fees referred to as “fee statement No. 2.” The second statement asked for $2,600 to cover the costs of preparing for and attending the sanctions hearing.
The master commissioner recommended that the Court reject the additional fee request, and concluded that P.J.E.’s attorney relinquished her opportunity for a greater award when she reached the $10,751 settlement.
The Court noted that in its decision sanctioning the Stafford attorneys, the opinion specifically stated that P.J.E.’s attorneys could recoup reasonable fees related to the sanctions hearing.
The Court agreed that Helfman’s $650 per hour fee was reasonable. The sanctions hearing lasted about an hour, and the attorneys made a four-hour roundtrip from Cleveland to Columbus to attend the hearing.
“If anything, then fee statement No. 2 undercounts the time incurred by Helfman in this matter,” the opinion stated.
The Court stated that Stafford’s refusal to accept the terms of the stipulations proposed by Helfman was the reason for the hearing and the expenses should be paid because of the “hard line drawn by the Stafford counsel.”
Dissent Negated Fault of Just One Party
In her dissent, Justice Stewart argued that the November 2023 decision allowing Helfman to recoup fees for the sanctions hearing was negated when the Court, in March 2024, informed the parties they could avoid the hearing by filing an agreed stipulation setting forth the stipulated amount of attorney fees to be paid. She also disagreed that the Stafford lawyers were solely to blame for the sanctions hearing.
“While the Stafford counsel could have agreed to the language of the stipulations that P.J.E.’s lead counsel, Jill Friedman Helfman, proposed, it is equally true that Helfman could have worked with the Stafford counsel on different language rather than insisting that the Stafford counsel adopt the language she had proposed,” the dissent stated.
The dissent noted that had the parties just submitted a statement detailing the amount of money the Stafford lawyers had agreed to pay, the Court could have inferred it was a reasonable amount paid for the attorney fees that were incurred in responding to and defending against the Stafford firm’s frivolous appeal.
2023-0907. H.R. v. P.J.E., Slip Opinion No. 2024-Ohio-4549.
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