Ramsey County District Court File No. C9-99-5187.
Considered and decided by Klaphake, Presiding Judge; Stoneburner, Judge; and Huspeni, Judge.
Minn. Stat. § 481.13 (2002) confers jurisdiction on the district court to establish an attorney lien on an arbitration award.
The opinion of the court was delivered by: Huspeni, Judge
Respondent, an attorney, moved the district court to establish an attorney lien on funds to which the rights of appellant, his client, were then being litigated and on funds appellant received from an arbitration award in a federal action. The district court established a lien for 24% of the arbitration award plus interest and ordered that 24% of the funds still subject to litigation be held pending resolution of the litigation. Appellant challenges the award. Because we conclude that the district court had jurisdiction to establish the lien under Minn. Stat. § 481.13 (2002) and established the lien in an appropriate amount, we affirm.
In 1999, appellant Gas Services, Inc., through its owner and sole agent Manjit Bajwa (collectively, Bajwa), hired attorney Thomas A. Foster of Thomas A. Foster & Associates, Ltd. (collectively, Foster), to represent it in an action in the federal district court of Minnesota (the federal action) to recover about $2,000,000 from a Michigan corporation, Howard Avista Energy (Howard). While this action was pending, Northern States Power Company (NSP) brought an interpleader action in Ramsey County District Court (the state action) against Bajwa and Howard to determine which of them should receive $600,000 held by NSP. Foster also represented Bajwa in the state action, which was stayed pending resolution of the federal action.
Five documents are relevant to the fee dispute that resulted from Foster's representation of Bajwa. The first, headed "Employment Agreement," was signed and dated by Foster on March 3, 1999, and by Bajwa on June 30, 1999. It provided for a 16% contingency fee if the federal action was settled during discovery, 25% if it was settled prior to trial, and 33% if it went to trial.
The second, headed "Agreement," was signed by both Bajwa and Foster on February 26, 2001. It acknowledged that the federal action had been resolved through arbitration and provided that the contingency fee would be 24% of the gross award.
The third, headed "Agreement[:] Arbitration of Attorney Fees," was signed by both Bajwa and Foster on October 10, 2001. It provided that (1) their attorney fee dispute would be submitted to a particular district court judge, and if he declined to arbitrate, to another named district court judge; (2) the agreement pertained only to GSI's action against Howard, not to GSI's action against NSP, for which Foster was owed no fees; and (3) the arbitrator's decision would be binding and non-appealable.
The fourth, handwritten by Bajwa, dated March 13, 2002, and signed by Bajwa and Foster, recited that (1) the arbitrators in the underlying action had awarded GSI approximately $2.8 million; (2) the award had been vacated by the federal district court; (3) Bajwa and Foster agreed that a major law firm should handle the appeal to the Eighth Circuit; (4) Foster had an agreement whereby he would receive 24% of the gross recovery, excluding the $600,000 recovered as the result of an interpleader action brought by NSP; and (5) the parties had had a fee dispute in August 2001 that they agreed to resolve by arbitration, but this agreement resolved all past fee disputes. The agreement provided that (1) Foster's fee would be reduced from 24% to 12%; (2) Foster would be responsible, but receive no additional ...