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Texas High Court to Hear $7.2M Fee Dispute

June 26, 2017 | Posted in : Contingency Fees / POF, Fee Agreements, Fee Dispute, Fee Dispute Litigation / ADR, Fee Issues on Appeal, Quantum Meruit, Unpaid Fees

A recent Texas Lawyer story by John Council, “Texas High Court Picks Up Oil Family’s $7.2M Attorney Fee Fight,” reports that one of Dallas' wealthiest families has frustrated federal courts with their bitter trust fund dispute for nearly a decade.  Now the Texas Supreme Court wants to jump in with a $7.2 million attorney fee dispute.

Hunt v. Hill involves a fight between the heirs of the Hunt family's oil fortune.  The case was settled in a U.S. District Court in Dallas in 2010 but continues to live on in numerous federal appeals over the distribution of trust funds and fee disputes among family members and their attorneys.  The Texas high court recently decided to hear one such fee dispute, Albert G. Hill Jr. v. Shamoun & Norman.

In this case, Dallas' Shamoun & Norman sued former client Albert G. Hill Jr. in state court alleging he owed them a multimillion-dollar "performance incentive bonus" for helping settle Hunt v. Hill.  But Hill countered he never signed a contract agreeing to pay that attorney fee.

A Dallas jury later awarded Shamoun & Norman $7.2 million in attorney fees under the theory of quantum meruit for the reasonable value of the services it rendered to settle those suits.  But the trial court set aside the jury's verdict and rendered a take-nothing judgment in Hill's favor — a decision the Fifth Court of Appeals reversed.

Hill appealed the verdict arguing he shouldn't have to pay for a bonus that was never put in writing.  The Texas Supreme Court agreed June 16 to hear the case to determine whether attorneys can recover fees under the theory of quantum meruit if their oral contract is unenforceable.

The opposing parties will bring two of the biggest guns in Texas appellate law with them to the high court's oral arguments.  Shamoun & Norman is represented by former Texas Supreme Court Justice Wallace Jefferson, who is now a partner in Austin's Alexander Dubose Jefferson & Townsend.

Hill is represented by James Ho, a former Texas solicitor general and partner in the Dallas office of Gibson Dunn & Crutcher, who's mentioned as a potential candidate for the U.S. Court of Appeals for the Fifth Circuit.

"This lawsuit exemplifies why so many Texans have such disdain for lawyers.  Texas law prevents attorney fraud and abuse by requiring lawyers to reduce contingency fee agreements to writing," said Ho, who has lined up considerable amici support for Hill's position.  "It is a simple requirement, and we agree with the district judge, the solicitor general, and the business community that it should be enforced, not nullified by lawsuits like this."