Florida’s 2nd District Court of Appeals (“2nd DCA”) recently issued an opinion impacting fee splitting contingency agreements between law firms. Harmon Parker, P.A. vs. Santek Management, LLC a/a/o The Gerber Law Group, P.A., Case No. 2D18-4632. (September 25, 2020), dealt with a dispute between two law firms over the division of $3.16 million in contingency attorneys’ fees, which was derived from an $8 million personal injury settlement. In Harmon, the Plaintiff in the underlying case was rendered a quadriplegic from a car accident. He then executed a Contract for Representation with Gerber Law Group (“Gerber”), and the Contract provided for contingency attorneys' fees consistent with the schedule established in rule 4.15(f)(4)(B)(1) a.-d. of the Rules Regulating the Florida Bar. Plaintiff also entered a Personal Injury Contingency Fee Contract with Swope, Rodante, P.A. (“Swope”). Thereafter, the parties (Plaintiff, Gerber and Swope) filed a verified petition for approval of the attorneys’ fee contract, which was approved. Then, trial was set. At that time, Gerber had little to prepare for trial and recognized its lack of resources and experience to properly try the case. As such, Gerber contracted with Harmon Parker (“Parker”). The Plaintiff subsequently terminated their contract with Swope and contracted with Gerber and Parker. Following settlement, Gerber sought additional attorney’s fees from Parker. The trial court found that Harmon breached the agreement and granted directed verdict for Gerber. Harmon appealed.
On appeal, the 2nd DCA reasoned that Gerber and Harmon failed to comply with Rule 4-1.5 (f) (4) (D). The Rule applies to those situations where a contingency fee is to be split between lawyers not in the same firm. Because of the nature of the fee-splitting arrangement set forth in the parties’ agreement, Gerber and Harmon were required to seek court approval for that arrangement. Rule 4-1.5(f)(4)(D)(iii) required, amongst other requirements, that the petition filed with the court to be sworn, signed by all counsel, and to disclose in detail the service to be performed by each counsel. Here, Harmon, on behalf of Plaintiff, filed an unsworn petition for approval. Gerber did not sign the petition, and no Gerber attorney attended the hearing on the petition. Likewise, rule 4-1.5(f)(4)(D)(iii) required Gerber and Harmon to accept substantially equal active participation in the legal services. The 2nd DCA found the noncompliance by both Gerber and Harmon to be substantial and significant. Accordingly, the 2nd DCA concluded that the fee-splitting agreement between Gerber and Harmon was void as against public policy and, thus, unenforceable.