Appeal from a judgment of the District Court of Nassau County, First District (Valerie Bullard, J.), entered October 31, 2005. The judgment, after a nonjury trial, awarded plaintiff the principal sum of $5,000.

Judgment reversed without costs and matter remanded to the court below for a new trial.

Plaintiff brought the instant small claims action against defendant attorney to recover a portion of the fees paid for the attorney's representation of plaintiff in a criminal case. Plaintiff had initially retained defendant to represent him in a matrimonial matter and had signed a retainer agreement with respect thereto. Several months later, plaintiff was charged with a felony regarding previously filed divorce papers which
allegedly contained the forged signature of his ex-wife. Pursuant to an oral agreement, plaintiff paid defendant $10,000 as a legal fee for the criminal case but no retainer agreement was ever signed regarding representation in the criminal matter. Plaintiff ultimately discharged defendant from representing him in the criminal case and engaged new counsel. Plaintiff testified that he had never received any billing statements from defendant and that, on several occasions, he had requested reimbursement and an itemization of his account. As of the date of trial, he had received neither an accounting of the legal fees nor a copy of his file.

Defendant testified that although he had been initially retained in the matrimonial matter, for which there was a written retainer agreement, the facts and issues in the criminal matter were interrelated with the matrimonial matter, and that he had spent a considerable amount of time on both. He proffered an itemized bill showing the time he had spent on both matters. It was his belief that the amounts received from plaintiff for the matrimonial and the criminal case "merged" and that plaintiff was being "charged off" on both actions.

The court below found that since the parties did not enter into a retainer agreement or letter of engagement with respect to the criminal case, defendant was precluded from retaining [*2]the amounts received from plaintiff for representation in the
criminal case. Accordingly, plaintiff was awarded the principal sum of $5,000, the jurisdictional limit of the Small Claims Part, as reimbursement.

The "Written Letter of Engagement" rule (22 NYCRR Part 1215) requires attorneys to provide clients with letters of engagement prior to representation, where the fee is expected to be more than $3,000. The rule does not apply to representation where the fee to be charged is expected to be less than $3,000 (22 NYCRR 1215.2 [a]); where the services of the attorney "are of the same general kind as previously rendered to and paid for by the client" (22 NYCRR 1215.2 [b]); and in domestic relations matters, which are subject to 22 NYCRR Part 1400 (22 NYCRR 1215.2 [c]). The language of the rule contains no express penalty for noncompliance, and the Appellate Division, Second Department, in Seth Rubenstein, P.C. v Ganea (___ AD3d ___, 2007 NY Slip Op 02923 [April 3, 2007]) declined to hold that an attorney's noncompliance with the rule precludes that attorney from recovering fees in quantum meruit. Indeed, while an attorney's failure to comply with the provision does not entitle a client to a return of legal fees where the services have already been rendered (see Lewin v Law Offs. of Godfrey G. Brown, 8 Misc 3d 622, 625 [Civ Ct, Kings County, 2005]), a client may seek to recover a fee already paid if it appears that the attorney did not properly earn said fee (see Beech v Gerald B. Lefcourt, P.C., 12 Misc 3d 1167[A], 2006 NY Slip Op 51092[U] [Civ Ct, NY County]). Even in the context of matrimonial cases, which are subject to more stringent rules (22 NYCRR Part 1400), an attorney's failure to execute a retainer agreement does not warrant "the return of a retainer fee already paid for properly-earned services" (id.; see also Mulcahy v Mulcahy, 285 AD2d 587, 588 [2001]; Markard v Markard, 263 AD2d 470 [1999]). We note that it has been held that an attorney using a nonrefundable retainer fee agreement with a client, which was later determined to be unenforceable, is still entitled to recover in quantum meruit for services actually rendered (see Matter of Cooperman, 83 NY2d 465, 475 [1994]).

As a matter of public policy, courts pay particular attention to fee arrangements between attorneys and their clients (see Jacobson v Sassower, 66 NY2d 991, 993 [1985]), and even where it is the client who commences an action to recover a portion of the attorney's fees paid, it is the attorney who must shoulder the burden of demonstrating the fair and reasonable value of the services rendered (id.; see also Seth Rubenstein, P.C. v Ganea, ___ AD3d ___, 2007 NY Slip Op 02923, supra). Although defendant herein sought to establish the reasonable value of the legal services rendered in the criminal matter (cf. Lasser v Schonbuch, 2 Misc 3d 139[A], 2004 NY Slip Op 50274[U] [App Term, 2d & 11th Jud Dists]), the court did not consider the evidence proffered in making its determination.

Accordingly, since the court below found only that defendant was barred from retaining any legal fees, and did not make a quantum meruit determination, a new trial is required to establish the value of the legal services rendered, in order to achieve "substantial justice . . . between the parties according to the rules and principles of substantive law" (UDCA 1807).

Rudolph, P.J., McCabe and Tanenbaum, JJ., concur.
Decision Date: July 12, 2007