By Captain Kirk Greiner, J.D.
I have read articles discussing the use of written contracts between experts and the attorneys for whom they work. Some experts say they don't use contracts and have never had a problem. They may furnish a written fee schedule and some furnish additional written expectations, but do not get a signature on the agreement.
Others, with written and signed agreements, don't get paid in spite of them.
But when it comes to collecting, who has the distinct advantage?
Let me tell you some of the sad scenarios of which I have personal knowledge. The most recent was a plaintiff attorney in Portland, Oregon, who retained an expert in a case against the U. S. Coast Guard for negligently carrying out a search and rescue case. The expert testified that the Coast Guard was in fact negligent and the court agreed, but held for the government stating that the Coast Guard was only held to the standard of a good Samaritan.
The expert had followed the attorney's instructions in all the work he had performed. There was no dispute. But as the attorney later stated in arbitration, the plaintiff was bankrupt and he, the attorney didn't have the money to pay. The arbitrator awarded the expert all of the fees he had claimed stating that in his opinion, the expert didn't charge enough for his services. The amount awarded was in excess of $10,000.
But the attorney fees and court costs which the expert incurred in his collection action were in excess of $6000 and he was unable to get the court to award him attorneys fees and costs. Why? Although he had a written and signed agreement, it did not state that the prevailing party was entitled to attorney's fees and costs. Result; after paying his attorney, the expert actually received less than half of his fee.
Another collection case is one currently under litigation. The underlying case was a product liability suit against a recreational boat manufacturer. It was alleged that a passenger on a luxury yacht fell overboard and died due to faulty design and construction of the boat.
At least three experts and one court reporter were not paid by the attorney for the plaintiff, even though the plaintiff received a small judgement. In this case, one of the experts has just started legal proceedings against the plaintiff's attorney for whom he was working and the plaintiff herself. For over a year, attempts to contact the plaintiff's attorney have failed. He's not available to come to the phone and doesn't answer calls. Complaints to the California Bar Association have met the strong wall of protectionism with the response, "that's your problem. We don't resolve these types of disputes."
Fortunately, the expert who is suing does have a good signed agreement with the attorney. The agreement says that the prevailing party will pay all attorney's fees including those for collection, and all costs. It also provides that the forum for any dispute is the cour6 in the state where the plaintiff resides. This means that he can obtain a judgement in a local court even if the attorney and suit were located in another state.
Sounds like the second expert might be in fairly good shape, doesn't it? Yes and no. When you have to resort to litigation to collect a just debt, the claimant still looses. He must spend uncompensated time preparing for and appearing in court. Some times the courts don't allow full recovery for the attorney's fees even though they are part of the written agreement. Once you get a judgement, you still have to collect on it and if the defendant resides in another state, this may mean filing the judgement in a court in that state and proceeding with collection there.
There are several observations which I would like to share with you.
1. Collection problems occur mostly with plaintiff attorneys.
2. Collections are much easier if you have a written and signed agreement. The agreement should include two essential paragraphs to facilitate collection. First, it must state that all attorneys fees and costs incurred in collection will be paid by the prevailing party. Second, it should state that the forum, the court in which the suit is heard, is the court nearest to the expert.
One may question the second choice since in order to collect, you may have to file your local judgement in a second court which has jurisdiction of the defendant's property. Usually, the local judgement will be a default judgement. The defendant attorney will not show up. Once you have a judgement, it is a great incentive for the defendant to pay since if he doesn't, the costs of collection will be added to the judgement against him. Thus, in many cases, the second court action will not be necessary.
If you are reading this article on our web page, you can click here to see a sample agreement. It is five pages in length. I have experienced only minor reluctance of attorneys to sign it. They handle contracts routinely and thus should understand the necessity for both parties to agree to the ground rules set forth in the contract. If they object, perhaps you should take their reluctance as a forewarning of possible future problems. Tell them that it is your routine contract and if they don't want to sign it, they can find another expert.
There is another section of the sample agreement which you may not understand (paragraph 9). It relates to the law which governs any disputes which arise. In my case, I specify the law of the state of Washington. The last issue of The Expert & The Law, published by the National Forensic Center has a lead article on Expert Immunity. That article states there are two states, Pennsylvania and Washington, which protect the expert from liability for their testimony. An article to that effect previously appeared in our newsletter. If a suit is filed against an expert, in order to have this shield of immunity, the laws of one of these two states must apply. Three states, California, Missouri and New Jersey have determined that experts can be held liable for their negligence and the remaining states have not ruled on this issue.
In summation, you should have a written agreement, and the agreement
should cover all of your expectations.
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