Friday, October 31, 2014
The top appeals court in New York has granted a $44 million bill for legal work that lasted less than five months, rejecting an argument that lawyers for a real estate entrepreneur’s wealthy widow had a “Svengali-like influence” on her.
The New York Court of Appeals also ruled that Graubarb Miller lawyers do not have to return $5 million in gifts they received from Alice Lawrence, saying this claim was made too late.
Taken up by Alice Lawrence’s estate after her death in 2008, the battle over the $44 million legal bill concerns a contingency-fee arrangement that she entered into with the Manhattan law firm. The battle centered around the executor of her husband’s estate and control of his real estate holdings.
In hopes of saving money, Lawrence agreed to pay the firm 40 percent of any future recovery. Within five months, the litigation settled for $111 million. Flabbergasted at paying Graubard the $44 million fee, new litigation ensued.
Yet, in reversing the Appellate Division ruling, the Court of Appeals said Lawrence was bound by the agreement, “She was a competent and shrewd woman who made a business judgment that was reasonable at the time, but which turned out in retrospect to be disadvantageous.”
See Martha Neil, Top NY Court Says Widow’s Estate Must Pay Lawyers $44M for Less Than Five Months’ Work, ABA Journal, Oct. 29, 2014.