Decision no. ... in the matter of fixing reasonable fees for attorneys or agents under the authority of Section 9 of the...

UNIV. OF FL Lll.
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U.S. DEPOOWTORY




THE AMERICAN COMMISSIONER

MIXED CLAIMS COMMISSION

UNITED STATES AND GERMANY


DECISION NO. 1
IN THE MATTER OF
FIXING REASONABLE FEES FOR ATTORNEYS OR
AGENTS UNDER THE AUTHORITY OF SECTION 9 OF
THE SETTLEMENT OF WAR CLAIMS ACT OF 1928"

DOCKET NO. 2004

Michael C. Regan, Claimant
Charles J. Katzenstein, Attorney


CHANDLER P. ANDERSON,
American. Con missioner.


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MIXED CLAIMS COMMISSION, UNITED STATES AND GERMANY

Established in pursuance of the Agreement between the
United States and Germany of August 10, 1922


CHANDLER P. ANDERSON
Amerikn Comi#sionter

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THE AMERICAN COMMISSIONER

MIXED CLAIMS COMMISSION

UNITED STATES AND GERMANY


DECISION NO. 1
IN THE MATTER OF
FIXING REASONABLE FEES FOR ATTORNEYS OR
AGENTS UNDER THE AUTHORITY OF SECTION 9 OF
THE SETTLEMENT OF WAR CLAIMS ACT OF 1928"


DOCKET NO. 2004


Michael C. Regan, Claimant

Charles J. Katzen.Ntein, Attorney


The above named claimant has duly filed with the American Com-
missioner a written request that he fix a reasonable fee to be paid by
him to his attorney, Charles J. Katzenstein, of New York City,
N. Y., as compensation for whatever services have been rendered by
the said attorney on behalf of and with the authority of the said
claimant, such services being of the character described in the provi-
sions of Section 9 of the "Settlement of War Claims Act of 1928".
The claimant. has objected to the amount of the fee asked by the
attorney on the ground that it is excessive, and the attorney has been
notified of the filing by the. claimant of this request that a reasonable
fee be fixed, and the attorney, in response to a request by the Ameri-
can Commissioner, has filed with him several affidavits, giving the
information which the attorney desires to have considered by the
Commissioner as showing the reasonableness of the fee asked, which
information has been brought to the attention of the claimant, who
18600-28 (19)








has filed an affidavit in reply, a copy of which has been transmitted
to the attorney.
The amount of the fee asked by the attorney as compensation for
his services in this matter is three thousand dollars ($3,000).
The award rendered by this Commission on behalf of the claimant
is made up of two items, one for the sum of $1,500 with interest
thereon at the rate of five per cent per annum from November 11,
1918, to the date of payment, and the other for the sum of $5,000
with interest thereon at the rate of five per cent per annum from
November 1, 1923, to the date of payment.
The item of $1,500 represents the value of personal property be-
longing to the claimant which was lost through the destruction of
two vessels on which the claimant had shipped as Chief Steward,
and which were sunk by German submarines, and the item of $5,000
represents damages for personal injuries suffered by the claimant
in consequence of the German submarine attack on one of the above
mentioned vessels.
On April 9, 1924, the claimant, after several conferences with the
attorney, signed a letter to him retaining him to prosecute the above
mentioned claim for personal injury and loss of property, and agree-
ing to pay him $25.00 retainer, which was paid, and one-fourth of
the amount recovered by way of suit or compromise. These terms of
employment were accepted by the attorney.
The chronological sequence of events in this case, as shown by the
record, is as follows:
It appears that before the claimant employed this attorney to
prosecute his claim there had been some delay or neglect on the part
of the claimant in filing his claim with this Commission, and some
question had arisen on technical grounds as to whether or not it
could be treated as filed in time for this Commission to take juris-
diction. This difficulty was overcome with the cooperation of the
Agent of the United States before this Commission and through the
courtesy of the Agent of Germany, and on April 4, 1928, Mr. Regan
was notified at a conference which he had with two members of the
legal staff of the United States Agency that arrangements had been
made for listing his claim. On the same date a letter was addressed
to him by the American Agent instructing him as to the evidence
necessary to sustain his claim. He was requested to submit in
duplicate sworn statements showing his American citizenship and








describing in detail the nature of the damages suffered, and setting
forth the articles of property lost and their value, and, as to his
personal injuries, showing his physical condition prior to the date
when they were sustained, and, as to his American citizenship,
duplicate certified copies of his birth certificate or an affidavit in
duplicate from someone who was in a position to swear to the
facts. Corroborative documentary evidence in duplicate was also
called for in the form of affidavits as to the lost personal property
belonging to him and its value, and also affidavits from physicians
establishing his personal injuries and his physical condition prior
thereto.
This letter was brought by the claimant, to the attention of his
attorney, and it is evident, accordingly, that on April 9, when the
claimant employed Mr. Katzenstein to act as his attorney, both he
and the attorney were fully informed as to exactly what was re-
quired to be done by them in order to establish his claim before this
Commission.
The record shows that Mr. Katzenstein immediately thereafter pro-
ceeded with great energy and despatch to secure the evidence called
for in the prosecution of this claim. The attorney states in his
affidavit that he felt this case should be given first preference in
his office and that the claim should be filed as promptly as possible.
He further states that with this end in view he spent considerable
time in preparing necessary papers to the neglect of other mat-
ters in his office. He hired an assistant who was a notary public
in order that he might interview the prospective witnesses, obtain
their statements, and have them sworn to after they had been pre-
pared in affidavit form by the attorney. The amount of time and
work involved in carrying out this program is stated in detail in
the attorney's affidavit and also in an affidavit made by the special
assistant, which has been submitted in this proceeding. It is evi-
dent from the record of what was done in securing these affidavits
that the services rendered were of great value in the prosecution of
the claim, and represent the expenditure of a very considerable
amount of time and effort by the attorney and his office force.
As a result of these efforts on the part of the attorney, he was able
to write to the American Agent on April 21, 1924, inclosing in dupli-
cate, as to both of the items of this claim, the claimant's petitions
verified on April 11, schedules of the personal property lost and its








value, certificates of the claimant's seaman's service, and seventeen
affidavits verified between April 11 and April 17 establishing the
claim both as to personal property and personal injuries. It is also
to be noted that, as appears from the later proceedings, the docu-
ments thus filed were found to be sufficient to establish the claim and
no further evidence of any kind was called for by either the American
or the German Agent.
On April 26 the American Agent wrote to the attorney informing
him that the German Agent was prepared to agree to an award in the
sum of $1,500 with interest at the rate of five per cent per annum
from November 11, 1918, to the date of payment for the loss of per-
sonal property, and the further sum of $2,000 with interest at the
rate of five per cent per annum from November 1, 1923, to the date of
payment for physical injuries, in settlement of this claim.
Upon receipt of this letter the attorney conferred with the claim-
ant, and on the advice of the attorney the claimant. authorized him
to reply that the sum of $2.000 for personal injuries was inadequate,
and suggested that this amount be increased to $5,000, which the
claimant would be prepared to accept, and also requesting that the
offer of $1.500 for personal property should be increased to $1,664.
On May 1 the American Agent informed the attorney that the
German Agent accepted his proposal so far as the item for physical
injury was concerned, but would not increase the item for personal
property.
On May 5 the attorney, after conferring with the claimant, replied
to the American Agent, informing him that the proposed settlement
for $1,500 for property and $5,000 for personal injury, with interest
as previously stated, was acceptable to the claimant.
On June 10 an award was rendered by this Commission on behalf
of the claimant for the amounts thus agreed upon, with interest as
above stated.
It thus appears that within a period of almost exactly two months
from the date upon which this attorney was employed the entire
claim was prepared and presented through his efforts, and an award
secured for an amount which was entirely satisfactory to the claim-
ant. This constitutes an exceptionally expeditious record in the pros-
ecution of claims before this Commission.
As to the amount awarded for the value of personal property lost,
it should be noted that the claimant's total valuation was approxi-








mately $1,800, but he had previously received an allowance of $200'
from his employers under his Articles of Employment, so that the-
award of $1,500 for this item was only about $100 less than the total
value claimed.
As to the award of $5,000 for personal injuries, it must be noted
that in accordance with the advice of his attorney the claimant re-
fused to agree to a settlement for $2,000, and the soundness of the
attorney's judgment in giving this advice is evidenced by the subs-
quent award for a larger amount.
Apparently the chief ground upon which the claimant bases his
contention that the agreed fee of twenty-five per cent of the amount
paid is excessive in this case is because he had to devote some of his
own time and attention to going about with the assistant employed
by the attorney in looking up and interviewing witnesses and obtain-
ing information for the affidavits afterwards sworn to by them. He
seems to feel that his contribution to the success of this work should
be to some extent credited to him in reduction of the amount of the
fee. On the other hand it must be recognized that the circumstances
of the case demanded his assistance in finding and interviewing his
witnesses. They were all known to him personally either as ship-
mates or tradesmen who sold him the property lost, or physicians
who had given him professional treatment, and in most of these cases
it is quite clear that the affidavits either would not have been so com-
plete as to details or would not have been furnished at all if the
claimant, had not put himself in personal contact with his witnesses.
Undoubtedly this was foreseen and taken into consideration by the
attorney at the time he accepted this employment and fixed the
amount of his fee for compensation, and he was justified by the re-
sults in calling upon the claimant for whatever assistance he was able
to render in the preparation of his case.
The skill with which this claim was prepared and presented by
the attorney, and the energy and success with which it. was prose-
cuted shows that he is-a practitioner of experience and sound judg-
ment, and has devoted his best. efforts to the interests of his client,.
who certainly had no reason to complain about the outcome of the
case.
Furthermore, the claimant was not merely a seafaring man with-
out business or world experience. He states in his own affidavit,.
submitted in this proceeding, that he is, and was at the time he made.








his agreement with this attorney, an inventor and business man .
engaged in the buckwheat coal grates business in New York, and
also that in the past he had done work for the Republican National
Committee Headquarters at New York, and that during the last
campaign this Committee sent him through twelve Atlantic seaboard
states, and also on an important mission of inquiry in Tennessee and
North Carolina, and that he had been offered a position with the
Department of Justice which he declined. Furthermore, during the
War he worked for the Naval Intelligence Bureau at the Barge
Office in New York, and was commissioned a First Lieutenant in the
United States Army. Obviously the claimant was entirely compe-
tent to look after his own interests in making a fee agreement with
this attorney, and falls within the group referred to in the following
extract from the Report of the Senate Committee on Finance recom-
mending this fee fixing legislation to the Senate:
It is expected, however, that it will not be necessary to alter amounts
fixed by contract with large corporations and others fully capable of protecting
their own interests. In such cases the American Commissioner
* would undoubtedly be justified in fixing the amount specified in the
contracts."
The American Commissioner concurs in this view, and holds that
the word reasonable" as used in the fee fixing provisions of the
Act can properly be given this interpretation. The American Com-
missioner also holds that the fee fixed by the agreement between the
claimant and this attorney was reasonable, not merely because it
seemed reasonable to the claimant and attorney at the time they
entered into it with full knowledge of exactly what services were
required, but also because the basis of payment was contingent upon
securing and collecting an award, so that the attorney's services were
rendered with the certainty of considerable delay in receiving his
fee, and with the possibility that no fee might ever be paid, and,
finally, the reasonableness of the fee fixed by this contingent agree-
ment is also justified when tested by the value of the services actually
rendered in this case, coupled with the fact that such fee covers all
expenses incurred, for which no extra charge was to be made under
the agreement, and which were greatly in excess of the $25.00 cash
payment made when the fee agreement was entered into.
Now, therefore, in the circumstances above set forth, and in view
of the considerations stated in the general Jurisdictional and Admin-








istrative Decision rendered by the American Commissioner under
date of September 28, 1928, and after careful examination and full
consideration of the information furnished in this proceeding by
the attorney and the claimant, and of the information pertinent to the
questions involved in this case on file in the records of this Commis-
sion, and after due deliberation thereon,
The American Commissioner decides and fixes as the reasonable
fee to be paid by the claimant, Michael C. Regan, to his said attorney,
Charles J. Katzenstein, in this case, the fee agreed upon and fixed in
the written agreement made by the claimant with his attorney,
namely, twenty-five per cent. of the amount received by the claimant
from the Treasury Department in payment of his award, in addition
to the $25.00 cash paid by the claimant to his attorney as a retainer,
said fee to .be paid by the claimant, and received by the attorney as
full compensation for all services rendered in the prosecution and
collection of this claim, as defined in Section 9 of the "Settlement of
War Claims Act. of 1928 ".
Done at Washington, D. C., this 10th day of October, 1928.
CHANDLER P. ANDERSON,
A merwcan Commissioner,
Mi.eed Claims Commission,
United States and Germany.
















































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