Top NY court says widow's estate must pay lawyers $44M for less than five months' work
Rejecting an argument that lawyers for a real estate mogul’s wealthy widow had a “Svengali-like influence” on her, the top appeals court in New York has OK’d a $44 million bill for legal work that lasted less than five months.
Reversing a lower court, the New York Court of Appeals also ruled that Graubard Miller lawyers do not have to return $5 million in gifts they received from Alice Lawrence, saying that this claim was made too late, Reuters reports.
The battle over the $44 million legal bill, which Alice Lawrence’s estate took up after her death in 2008, concerns a contingency-fee agreement that she entered into with the Manhattan law firm in 2005. At that point, she had paid Graubard Miller $18 million during litigation that had lasted more than two decades. It concerned a battle with the executor of her husband’s estate over control of his real estate holdings.
Hoping to save money, Lawrence agreed to pay the firm 40 percent of any future recovery. Within five months, the litigation settled for $111 million. Lawrence then balked at paying Graubard the $44 million fee, and new litigation ensued.
Reversing an Appellate Division ruling that the contingency fee agreement was unconscionable, the Court of Appeals said Lawrence was bound by it. “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,” Judge Susan Read wrote in the court’s majority opinion.
The New York Law Journal (sub.req.) also has a story.
ABAJournal.com: “Appeals court cuts ‘unconscionable’ estate legal bill from $44M to perhaps $3M”