It is well-settled in Georgia that an attorney discharged by a client prior to the occurrence of the contingency specified in the contingency fee contract is not entitled to collect a contingency fee. But under such circumstances, an attorney discharged prior to earning a contingency fee is typically still entitled to recover from the client based on quantum meruit.
In light of this law, is an attorney liable for abusive litigation if he files an action to collect under a contingent fee agreement where he was discharged prior to the contingency, or demands a recovery under quantum meruit based solely on the amount of recovery under the contingent fee agreement?
In Kendrick v. Funderburk, 230 Ga. App. 860, 863 (1998), discharged attorneys sought to collect their contingent fee under an unrealized contingent fee agreement. The court granted the former client’s motion for summary judgment and refused to award the contingent fee.
The former client then filed a subsequent action, asserting a claim for abusive litigation against the discharged attorneys on the grounds that the claim for a contingent fee was without substantial justification.
The trial court granted the discharged attorneys’ motion for summary judgment and dismissed the abusive litigation claim. The former client appealed. The Court of Appeals reversed, holding that there was sufficient evidence in the record to create a question of fact on this issue.
The morale of the story – don’t overreach.