A six-lawyer Brooklyn firm that assigned a law student and junior associate to a client’s case has been barred from collecting its legal fee by a Brooklyn judge who said the firm’s bills were “overly broad, padded, excessive and unreasonable.”
In ordering the firm to return nearly $2,000 to its client, Brooklyn Civil Court Judge Harriet Thompson said, “It is totally inappropriate for a lawyer to learn his or her craft at the total expense of his or her client.”
The fact that Law Office of Thaniel J. Beinert billed at an hourly rate $250 for a third year law student was “even more troubling and frankly, outrageous and disingenuous,” Thompson said.
The Beinert firm represented Inna Litinskaya in an attempt to remove tenants, who were her ex-husband’s parents, from a Brooklyn apartment. Litinskaya obtained interest in the apartment under a divorce judgment.
Litinskaya agreed to retain Beinert’s firm in April 2004 for a flat fee of $3,000. After the firm spoke with the couple’s attorney, who said they were not subject to eviction under a prior lease agreement, Litinskaya and Beinert entered into a second retainer agreement.
That retainer included the firm’s hourly rate, including $300 for Beinert and provided that if the client didn’t pay within 15 days of a bill, the firm would apply interest.
Beinert’s firm made repeated attempts to void the lease in New Jersey Superior Court, where the divorce action took place, but that court denied the motions based on lack of jurisdiction.
By September 2004, Litinskaya allegedly owed more than $15,000 to Beinert. The firm agreed to reduce the bill to $7,500 after Litinskaya complained of overbilling.
Litinskaya fired the Beinert firm in November 2004. In a reply letter, the firm told her it viewed her termination letter “as a mere attempt to avoid paying the outstanding legal fees,” including interest and collection costs. The firm also said that upon receipt of the recorded lease from her former in-laws, “we specifically advised you that this case was complex and extensive legal fees would be incurred.”
In May 2005, Beinert’s firm sued Litinskaya to collect $18,175 in fees, and Litinskaya answered with counterclaims alleging malpractice, and fraud.
Seven years later when the fee dispute came to trial, Beinert’s firm claimed she owed more than $90,000, including interest charges and underlying claims.
Thompson in her decision questioned whether Litinskaya understood the retainer terms, since her primary language is Russian.
The judge said Beinert’s course of action in New Jersey was unreasonable, and attempts to modify or declare the alleged lease agreement null and void were improper.
The proper course would have been to start a summary proceeding to recover possession of the apartment in the Brooklyn Housing Part in Civil Court, not New Jersey Superior Court, Thompson said in Law Office of Thaniel J. Beinert v. Litinskaya, 53078/05. Under New York law, both parties would have had the opportunity to participate in a evidentiary hearing to determine the lease validity.
She said there was no indication that Beinert consulted an attorney knowledgable in this area of law.
Litinskaya’s second attorney, Steven Garfinkle, pursued an action in Supreme Court and the parties amicably resolved the matter within two to three months.
“This action did not involve any novelty or difficulty,” Thompson said. “An experienced and skillful landlord and tenant attorney could have accomplished the primary objective in this case in a very short period of time.”
The judge also took issue with the use of a law student and an inexperienced associate.
“If this was such a complex legal case, would a managing partner and owner of the law firm with presumably 8 years of legal experience have delegated the responsibility of handing this case to a three year law student … and to an associate with 3 years or less of legal experience and training,” the judge said.
The hours spent by the law student and the associate “were clearly excessive,” and attorneys are “not entitled to compensation that creates a windfall,” Thompson said.
She also questioned whether the associate or student actually expended the time billed since no records were produced at trial. “It is inexcusable that the legal research time was not documented at all and more offensive to this court, nothing at all was produced at trial,” the judge said.
The law student should have billed at $85 or less, the judge said, not $250. Although the work could have been performed more efficiently by an experienced attorney, the judge said, Beinert himself spent only 2.5 hours on the case.
Thompson also criticized Beinert’s decision to have a junior associate act as trial counsel in the collection lawsuit. “The trial transcript in this case speaks volumes of imprudence, inexperience and developing trial skills. It is apparent that no one, not even the managing partner, consulted with outside counsel to discern the requisite elements to prove a legal fee dispute case,” the judge said.
“This court was remorseful that a young associate was obligated to act as trial counsel for his employer in this legal fee case,” she said.
Thompson denied the firm’s claim for $90,057 in legal fees as without merit. “No one could credibly argue that a reasonable paying client would be willing to pay in excess of $90,000.00 for a result valued at $3,000.00 or less,” the judge said.
Even though the second retainer agreement had the late payment penalty provision, no bill contained a late payment fee and “accordingly, the failure of the plaintiff to enforce its own contract constitutes a knowing and voluntary waiver of those claims.”
Thompson said the total allowable fee, after the judge’s adjustments to correct hourly rates and billing time, was about $12,081.
She found Litinskaya had already paid $10,500. Factoring in her $3,500 payment to Garfinkle, the judge found Beinert’s firm was not entitled to fees and is required to refund Litinskaya about $1,918.
The judge found no evidence to support Litinskaya’s counterclaims for fraud or malicious or criminal wrongdoing, and no evidence for legal malpractice per se.
Beinert did not respond to messages seeking comment.
Steven Podolsky, Cherny & Podolsky, counsel for Litinskaya, said his client was pleased. Beinert’s firm “tried to take advantage of my client and the judge saw that,” he said.