Utah Supreme Court
Can contingency fee agreements include court-awarded attorney fees? Redd v. Hill Explained
Summary
Attorney Don Redd represented Virginia Hill under a contingency fee agreement entitling him to one-third of ‘all monies’ paid to Hill. After Hill obtained a judgment and court-awarded attorney fees, she paid Redd one-third of the primary judgment but disputed his entitlement to one-third of the attorney fees award. The district court ruled the agreement was unambiguous and entitled Redd to one-third of the attorney fees.
Analysis
The Utah Supreme Court’s decision in Redd v. Hill provides important guidance for practitioners drafting contingency fee agreements, particularly regarding whether such agreements extend to court-awarded attorney fees.
Background and Facts
Attorney Don Redd represented Virginia Hill under a contingency fee agreement stating that “Attorney is entitled to ONETHIRD (33 1/3%) of all monies paid to or in client[‘]s behalf for what ever [sic] cause related to this cause of action.” Hill’s underlying litigation resulted in a judgment of over $6 million, plus a supplemental attorney fees award of $593,034.40. Hill paid Redd one-third of the primary judgment but refused to pay any portion of the attorney fees award, arguing the agreement did not cover such fees.
Key Legal Issues
The central issue was whether the contingency fee agreement was ambiguous regarding attorney fees, and if so, whether any ambiguity should be construed against the drafting attorney. Hill also argued that allowing the attorney to take a percentage of attorney fees violated the purpose of such awards.
Court’s Analysis and Holding
The court applied principles of contract interpretation, finding the agreement unambiguous. The phrase “all monies paid to or in client’s behalf” encompassed the attorney fees award because it was undoubtedly part of the money awarded to Hill based on Redd’s representation. The court emphasized that “all” means “the whole extent or quantity of” and “every one of,” which included the attorney fees component. The agreement also complied with Utah Rule of Professional Conduct 1.5(c) requirements for contingency fee agreements.
Practice Implications
This decision underscores the importance of precise drafting in contingency fee agreements. Attorneys should explicitly address whether court-awarded attorney fees are included or excluded from the contingency percentage. The court noted that while ambiguous fee agreements are construed against the attorney, clear language will be enforced as written. Practitioners should also ensure compliance with Rule 1.5(c)’s notice requirements while using plain, accessible language that clients can understand.
Case Details
Case Name
Redd v. Hill
Citation
2013 UT 35
Court
Utah Supreme Court
Case Number
No. 20120552
Date Decided
June 18, 2013
Outcome
Affirmed
Holding
A contingency fee agreement stating that attorney is entitled to one-third of ‘all monies paid to or in client’s behalf for what ever cause related to this cause of action’ unambiguously includes court-awarded attorney fees.
Standard of Review
Correctness for questions of contract interpretation not requiring extrinsic evidence and questions of law regarding attorney fee recovery; abuse of discretion for determination of reasonable attorney fees
Practice Tip
Draft contingency fee agreements with precise language specifying whether attorney fee awards are included or excluded from the contingency percentage to avoid disputes.
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