Johnson v. Guardianship of Ratcliff

OHN E. JENNINGS, Judge. This is an appeal from an order awarding a fee to an attorney hired by a guardian to represent the interests of the guardian’s ward, a minor child. For reversal of that order, appellant argues that the guardian did not have the authority to enter into a binding contract for legal services; that the probate court erred in awarding the attorney’s fee from the proceeds of a wrongful-death action; and that the fee was excessive. We affirm. On July 5, 1998, Gwenda Johnson died in a car accident. Her daughter, Rachael Renea Ratcliff, then age two, was also injured, as were other passengers in Ms. Johnson’s vehicle. Willie Ray Rat-cliff Rachael’s putative father, took custody of her and obtained a temporary order of guardianship from the Garland County Probate Court on July 21, 1998. On July 23, 1998, Mr. Ratcliff as the guardian for the child, entered into a contingency-fee contract with attorney Burt Newell for representation in connection with the child’s claims arising from the car accident. Gwenda Johnson was also survived by her parents and numerous siblings. Appellant Levern Johnson, her sister, was appointed the administratrix of her estate by the Pulaski County Probate Court. With the court’s permission, the estate intervened in a lawsuit in Pulaski County Circuit Court brought by the estates of the deceased and the injured passengers who were riding in Gwenda Johnson’s vehicle. Mr. Ratcliff, as guardian, also intervened to present a claim on behalf of the child because of her injuries. With $115,000.00 in insurance monies, the plaintiffs setded the tort case. The estate of Gwenda Johnson received $38,000.00 for her wrongful death. Rachael was allotted $2,000.00 for her personal injuries. The parents and siblings of Gwenda Johnson disclaimed any interest in the setdement proceeds. Out of the fund, the attorney for the estate received a fee of $1,500.00 and costs of $62.45. Appellant, as administratrix, was paid $200.00 for her out-of-pocket expenses. As sanctioned by court order, the balance of the money, $36,237.55, was placed into the registry of the Garland County Probate Court for Rachael’s benefit. Burt Newell then petitioned the Garland County Probate Court for the payment of his attorney’s fee based on the contract entered into with Mr. Ratcliff, the guardian. Appellant filed an objection to this fee request. After a hearing, the probate judge upheld the contingent-fee contract and awarded Mr. Newell the sum of $12,258.22 out of the ward’s estate. The crux of this appeal is appellant’s argument that the proceeds from a wrongful-death action are exempt from the claims of attorneys who represent individual beneficiaries of the decedent’s estate, and she argues that the probate court erred by awarding the fee out of the ward’s estate. She relies on the decision in Brewer v. Lacefield, 301 Ark. 358, 784 S.W.2d 156 (1990), as support for her argument. We do not agree that Brewer holds that a ward’s attorney may never be compensated out of funds held by a guardian that are attributable to a wrongful-death settlement. In Brewer, the deceased was survived by three heirs: his widow, and two children from a former marriage. The widow was appointed administratrix of the deceased’s estate, and she hired two attorneys to pursue a wrongful-death action. The children’s mother also hired two attorneys to represent their interests in the lawsuit. The attorneys on each side had contingent-fee contracts to receive one-third of the proceeds from the action. From the proceeds available for distribution, the administratrix proposed that the attorneys for the estate receive one-third of the total as their fee, with the remainder, after deducting other expenses, to be divided equally between her and the two children. The children’s mother objected to this plan because it made no provision for the payment of fees to the children’s attorneys. She contended that the children’s attorneys should be paid out of the funds to be distributed to them and that the attorneys for the estate should receive their contingent fee only out of the sum recovered by the administratrix. The trial court rejected this plan and entered an order in accordance with the proposal made by the administratrix. In affirming, the supreme court held that a probate court has no jurisdiction to award attorneys’ fees for services rendered to individual beneficiaries of a wrongful-death action. The court based its decision on the provisions of the wrongful-death code and the case law interpreting it that it is the duty of the personal representative, not the beneficiaries, to choose counsel to pursue a wrongful-death claim. Contrary to appellant’s assertion here, the court did not hold that the proceeds from a wrongful-death action were of a special class exempt from the claims of attorneys who represent the individual beneficiaries. The court merely held that the attorneys for individual beneficiaries were not entitled to consideration when the proceeds from a wrongful-death action are being distributed. As the court said, “the beneficiaries are free to select counsel to see that their interests are protected, however, they must hear this expense.” Id. at 363 (emphasis supplied). Here, an attorney was employed to represent the interests of the ward. The trial court’s decision to approve a fee payable from the ward’s estate is not inconsistent with the supreme court’s decision in Brewer. Appellant also argues that the fee contract was invalid because Ark. Code Ann. § 28-65-301 (a) (3) (1987) provides that a guardian of the person does not have the power to bind the ward or his property, and the guardian in this instance was only the guardian of the minor’s person when the contract was negotiated. Appellant also points out that the order appointing Mr. Ratcliff as guardian of the person authorized him to engage the services of an attorney but did not expressly approve the fee contract. Under Ark. Code Ann. § 28-65-319(a)(1) (1987), a guardian is specifically authorized to employ legal counsel in connection with the discharge of his duties. Moreover, the hiring of an attorney is not listed among those decisions made by a guardian that always requires prior court approval as provided in Ark. Code Ann. § 28-65-302 (Supp. 1999). Even if the guardian acted precipitously, he was subsequendy made the guardian of the child’s estate, and he has taken no action to disavow the fee contract but has since reaffirmed it in every respect. Arkansas Code Annotated section 28-65-319(a)(l) further provides that the court shall fix the fee of the attorney hired by a guardian and that the fee shall be allowed as an item of the expense of administration. The probate court, after a hearing, did review the actions of the guardian and approved them, and in the exercise of its superintending control, the court set the fee. We are therefore not persuaded that the decision must be reversed on this basis. Appellant’s final argument is that the fee awarded to Mr. Newell was excessive. She argues that Mr. Newell did little work on the case and that his claim of one-third of the monies is unconscionable. Mr. Newell testified that he appeared on behalf of the child in four different courts. In addition, he opened the guardianship and also prepared pleadings connected with the intervention in the tort case. He said that he had monitored the criminal prosecution against the tortfeasor by sitting in court both when she was arraigned and when she entered a guilty plea to a charge of negligent homicide. He also said that he researched the possibility of bringing the tortfeasor’s business into the wrongful-death suit. Mr. Newell testified that he coordinated all of the insurance benefits from the accident and that he played an active role in negotiating the terms of the settlement, which he considered favorable. He said that, had the tort case gone to trial, he was prepared to put on proof as to how the child had suffered because of the loss of her mother. In determining what is a reasonable fee, it is proper to consider the amount and character of the services rendered, the labor, time, and trouble involved, the nature and importance of the litigation or business in which the services are rendered, the amount or value of the property involved in the employment, the skill or experience called for in the performance of the services, and the professional character and standing of the attorneys. Jones v. Barnett, 236 Ark. 117, 365 S.W.2d 241 (1963). The probate court was in a position to assess the value of counsel’s service to the estate and to properly determine the amount of fees to which counsel should be entitled. See Winters v. Winters, 24 Ark. App. 29, 747 S.W.2d 583 (1988). We find no error. Affirmed. Robbins, C.J., Hart and Meads, JJ., agree. Griffen and Crabtree, JJ., dissent.