After Nearly a Decade and Two Appeals, Client Obtains $334,000 Fee Award From Lawyer Who Sought to Collect $3,720 of Unpaid Legal Fees

Soni v. Cartograph, Inc., 90 Cal.App.5th 1, 306 Cal.Rptr.3d 446 (2023).

By Patrick M. Maloney and Brittany Genthert

Lawyers are well advised to think twice before suing a client for legal fees.  Suits for unpaid fees routinely attract legal malpractice claims from disgruntled clients.  In addition, they may expose lawyers to further liability under California’s Mandatory Fee Arbitration Act (“MFAA”), Cal. Bus. & Prof. Code § 6200 et seq.  The California legislature enacted the MFAA to level the playing field between attorneys and clients in fee disputes.   As one lawyer recently learned after nine years and two appeals, the MFAA does so in part by penalizing parties who take “unreasonable” positions in legal fee disputes.   

Timothy Tierney and Cartograph (formerly SimpleLayers, Inc.) retained attorney Surjit Soni.  Eventually, Tierney told Soni not to do any further work and moved the case from Soni’s firm.  Tierney agreed to pay Soni’s outstanding balance, which Soni claimed was $7,211.  Tierney paid $3,531 but declined to pay the remaining $3,720 because he had not authorized the work. 

Tierney then initiated a Mandatory Fee Arbitration with the Los Angeles County Bar Association.  The arbitrator awarded Soni a total of $2.50.  Soni filed for a new trial 33 days after service of the award.  Following a bench trial, the court entered judgment in favor of Soni in the amount of $2,890 and ordered Tierney to pay Soni’s attorneys’ fees in the amount of $79,898.

Tierney appealed.  In a published opinion, Soni v. SimpleLayers, Inc., 42 Cal.App.5th 1071 (2019), the Court of Appeal reversed the judgment.  The Court of Appeal held that the 30-day period within which to seek a trial de novo is not extended by five days when the fee award is served by mail.  Thus, Soni’s request for a new trial was three days too late.  The Court of Appeal sent the matter back to the trial court with directions to confirm the arbitration award, as Tierney had requested.

After remand, Soni filed a motion claiming $546,365 in attorneys’ fees for 1,400 hours of work in the fee case.  Having obtained a total recovery of $2.50, Soni claimed he was entitled to a fee award pursuant to a prevailing parties’ attorney fee provision in his fee agreement with Tierney. 

Tierney also filed a motion for attorney’s fees seeking $339,603 for 731.8 hours of work.  Tierney presented his request for legal fees under California Business & Professions Code § 6203(c), which provides for an award of attorney’s fees to a party who is successful in confirming an award issued in a Mandatory Fee Arbitration. 

The trial court awarded attorneys’ fees to Tierney under both Section 6203(c) and Section 6204(d).  Subdivision (d) of Section 6204 provides courts with discretion to award attorneys’ fees to the prevailing party where one of the parties seeks a trial de novo.  The party who sought a new trial is the prevailing party if they obtain “a judgment more favorable than that provided by the arbitration award.”  Otherwise, the other party is the prevailing party.  Because Tierney was successful in obtaining confirmation of the MFAA fee award and because Soni did not achieve a better result, the trial court found Tierney to be the prevailing party, awarding attorney’s fees and costs totaling $334,458.41.

Soni appealed.  The Court of Appeal affirmed, finding that under both Sections 6203 and 6204, Tierney was the prevailing party.  The Court of Appeal found that because the trial court had confirmed the arbitration award, Soni was not the prevailing party, notwithstanding that he won $2.50 in the arbitration.  Soni had not obtained a more favorable result in the trial de novo, and Tierney was successful in having the arbitration award confirmed.

The Court of Appeal also held that fee provisions contained in the MFAA, namely, Sections 6203(c) and 6204(d), preclude contractual attorneys’ fees provisions.  The Court of Appeal explained that the fee-shifting provisions in the MFAA encourage parties to avoid further frivolous litigation.  Only parties who file meritorious positions to confirm, correct, or vacate an MFAA arbitration award may recover legal fees.  This is intended to discourage unmeritorious petitions.

Similarly, a party unhappy with an MFAA fee award may insist upon a new trial.  However, the party who does so must consider the risk of paying their adversary’s legal fees if they do not achieve a more favorable outcome. 

Lawyers should be careful in the positions they take in legal fee disputes.  Just because an attorney can sue for unpaid fees, does not mean that they should.  In addition to the risk of a malpractice suit, there is also the risk of paying the former client’s legal fees.

About the authors

Patrick Maloney regularly represents lawyers and their clients in disputes with one another, including claims for legal malpractice, breach of fiduciary duty, and legal fee disputes.  Mr. Maloney previously sat on the California State Bar Committee on Mandatory Fee Arbitration and presently serves as a Vice Chair of the Los Angeles County Bar Association’s Attorney-Client Mediation and Arbitration Service.  Mr. Maloney also represents clients in business litigation matters.

Brittany Genthert is an Associate Attorney at The Maloney Firm.  Ms. Genthert represents clients in legal fee disputes and related matters in addition to business disputes.

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