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Gulf Coast Bank & Trust Co., Inc. v. Casse

Court of Appeals of Louisiana, Fourth Circuit

November 22, 2017

GULF COAST BANK & TRUST COMPANY, INC.
v.
GILLES J. CASSE, GMD INTERNATIONAL, INC. AND DAMON BALDONE

         APPEAL FROM CIVIL DISTRICT COURT, ORLEANS PARISH NOS. 2010-01908, 2014-11068, DIVISION "L-6" Honorable Kern A. Reese, Judge

          Jack A. Ricci Michael S. Ricci Jonathan L. Schultis Brian G. LeBon RICCI PARTNERS, LLC COUNSEL FOR PLAINTIFF/APPELLEE

          Damon J. Baldone Thomas E. Dunn COUNSEL FOR DEFENDANT/APPELLANT

          Court composed of Chief Judge James F. McKay, III, Judge Edwin A. Lombard, Judge Roland L. Belsome

          EDWIN A. LOMBARD JUDGE.

         The instant appeal involves a dispute over attorneys' fees pursuant to a contingency fee agreement between Gulf Coast Bank and Trust ("GCBT") and the Appellee, Ricci Partners, LLC ("the Appellee"). The Appellant, Damon Baldone, seeks review of the district court's January 10, 2017 judgment wherein it reduced its prior award of attorneys' fees to the Appellee to $800, 000. Finding the district court did not abuse its discretion, we affirm.

         Facts

         The Appellee represented GCBT in a contract suit filed by GCBT in 2010 against Mr. Baldone in his capacity as a personal guarantor for obligations that were defaulted upon. In January 2014, GCBT and the Appellee entered into a contingency fee agreement.

         Following the trial and while the matter was under advisement in Civil District Court ("district court"), in May 2014, Mr. Baldone filed a complaint with the Federal Deposit Insurance Corporation ("FDIC")- and a similar complaint with the Louisiana Office of Financial Institutions ("OFI")- seeking damages and penalties for himself against GCBT as well as the revocation of GCBT's charter. According to the Appellee, Mr. Baldone's filings referenced this litigation and asserted that GCBT purposefully hid or destroyed documents. The FDIC claim against GCBT was closed in May 2014, after the Appellee intervened on behalf of GCBT.

         The following month, Mr. Baldone filed a bar complaint against Jack A. Ricci ("Mr. Ricci"), who is an attorney with the Appellee's firm and was representing GCBT, with the Office of Disciplinary Counsel ("ODC"). The bar complaint was later dismissed by the ODC.[1]

         Mr. Baldone then filed a petition for damages on July 23, 2014, in the 32ndJudicial District Court for the Parish of Terrebonne, raising spoliation claims against GCBT. Such claims had previously been raised by Mr. Baldone in a motion for spoliation of evidence in the district court, but had been dismissed. As such, on August 4, 2014, GCBT filed a declinatory exception, which was granted by the 32nd Judicial District Court. The matter was dismissed and transferred to the district court.[2]

         In January 2015, Mr. Baldone filed an amended petition in the lawsuit that had been transferred from Terrebonne Parish to the district court and consolidated with the underlying litigation. GCBT, in response, filed an exception of res judicata/collateral estoppel to dismiss the new claims raised in the amended petition.

         On February 11, 2015, the district court rendered judgment in favor of GCBT, and granted its declinatory exceptions dismissing the claims raised in Mr. Baldone's amended petition. The district court awarded GCBT $2, 109, 221.69, plus unpaid fees in the amount of $127, 030.85, plus interest until paid. Lastly, the district court awarded attorneys' fees to GCBT, pursuant to the contingency fee agreement, in the amount of 40% of the final judgment, or approximately $894, 501.00.

         Mr. Baldone appealed the February 11, 2015 judgment, which was affirmed in all respects by this Court, except as to the attorneys' fee award.[3] The attorneys' fee award was vacated and the matter was remanded to the district court to conduct a reasonableness hearing. The Supreme Court denied Mr. Baldone's application for a writ of certiorari on September 16, 2016.

         The district court held a reasonableness hearing on August 22, 2016, and later rendered a judgment reducing its award to $800, 000. Mr. Baldone timely filed the instant appeal. He raises three assignments of error:

1. The district court erred in awarding attorneys' fees to the Appellee based on a contingency fee agreement;
2. The district court erred in awarding attorneys' fees based on an affidavit of counsel for GCBT that it had stopped billing GCBT after the execution of a contingency fee agreement; and,
3. The district court erred in accepting the Appellee's misleading representations of the number of hours spent in prosecuting GCBT's case.

         Standard of Review and Applicable Law

         The trial court has much discretion in fixing an award of attorneys' fees, and its award will not be modified on appeal absent a showing of an abuse of discretion. Whitney Bank v. NOGG, L.L.C., 15-1399, pp. 6-7 (La.App. 1 Cir. 6/3/16), 194 So.3d 819, 824 (citing Regions Bank v. Automax USA, L.L.C., 02-1755, p. 4 (La.App. 1 Cir. 6/27/03), 858 So.2d 593, 595. The trial court's determination of whether a fee is clearly excessive is a factual question which will not be disturbed absent manifest error. Teche Bank and Trust Co. v. Willis, 93-732 (La.App. 3d Cir. 02/02/94), 631 So.2d 644, 647.

         The First Circuit recently set forth the role of Louisiana courts in reviewing contracts executed between attorneys and their clients involving the amount of attorneys' fees charged:

Further, "[c]ourts are vested with the responsibility of both monitoring and analyzing the attorney-client relationship, even when it is based on a written contract between the parties." In re Interdiction of DeMarco, 2009-1791 (La.App. 1 Cir. 4/7/10), 38 So.3d 417, 427. However, that responsibility must be carried out with restraint, especially when the parties have signed a contract that sets the terms of the attorney-client relationship. DeMarco, 38 So.3d at 427. Part of any attorney-client relationship is the fee the attorney may charge the client for professional services. Any court-ordered reduction in an attorney's fee must rest upon a factual finding that the excessive fee amount was never earned.DeMarco, 38 So.3d at 427. Absent ...

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