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

8.59


THE AMERICAN COMMISSIONER

MIXED CLAIMS COMMISSION

UNITED STATES AND GERMANY


DECISION NO. 29
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. 241

Dorothy Conner Dugger, Claimant
Hunt, Hill & Betts, Attorneys

CHANDLER P. ANDERSON,
American Commissioner.


U. B. GOVERNMENT PRINTING OfITCB: 1m-.


UNIV. OF. FL LII.
DOCUMENTOI DEPT



U.S. DEPOSITORY






























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
America Oonmfamoner
(m)












THE AMERICAN COMMISSIONER
MIXED CLAIMS COMMISSION
UNITED STATES AND GERMANY


DECISION NO. 29
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. 241


Dorothy Conner Dugger, Claimant
Hunt, Hill & Betts, A ttorneys


The above named claimant has duly filed with the American
Commissioner a written request that he fix a reasonable fee to be
paid by her to her attorneys, Hunt, Hill & Betts, of New York City,
N. Y., as compensation for whatever services have been rendered by
them on behalf of and with the authority of the said claimant, such
services being of the character described in the provisions 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
attorneys on the ground. that it is excessive, and the attorneys have
been duly notified of the filing by the claimant of her request that
a reasonable fee be fixed. The attorneys have filed with the Ameri-
can Commissioner an affidavit sworn to on their behalf by Mr. Betts
and also an affidavit of Mr. Lincoln McCormack, an attorney, for-
merly of Medford, Jackson County, Oregon, but now of New York
City, giving the information which they desire to have considered by
40156--29 (201)






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the Commissioner as showing the reasonableness of the fee asked,
which information has been brought to the attention of the claimant.
The claimant, in acknowledging the receipt of this information, ,
stated that she did not care to make a reply, and the Commissioner
must, therefore, assume that the claimant admits that the informa- 1
ion furnished by the attorneys is correct.
The award in this case was rendered by this Commission on Feb-
ruary 21, 1924, on behalf of the claimant, for $2,160, with interest
thereon at the rate of five per cent per annum from May 7, 1915,
to the date of payment, which amount represents the value of per-
sonal property belonging to the claimant lost through the sinking -!
of the Lusitania on May 7, 1915, by a German submarine, and
for the further sum of $10,000, with interest thereon at the rate of
five per cent per annum from November 1, 1923, which amount repre-
sents damages for personal injuries suffered by the claimant in
consequence of the submarine attack.
The amount of compensation asked by the attorneys for services
rendered is $4,500, not including disbursements which they estimate
at $328.32, on account of which the claimant has already paid the sum i
of $85.00 according to the terms of the services agreement herein-
after referred to and the balance of which, amounting to $243.32, the
attorneys allege is still due. The attorneys further ask that they be
allowed the sum of $250 for time and expenses in connection with the
escrow agreement, hereinafter referred to, and for proving the
amount of their fees before the American Commissioner.
It appears from the affidavits filed by the attorneys that on Jan- 1
uary 9, 1916, the claimant, then Miss Dorothy Conner, through her *
brother, Mr. Boudinot Conner, employed Mr. Lincoln McCormaclk
then practicing law in Jackson County, Oregon, where the claim- W
ant had resided at various times from 1912 to 1917, to protect her ::
interests and to enforce her rights in this claim. This attorney then ..
took the claim up with the State Department, but, on May 5, 1916, .
after he had learned of the formation in New York City of a corn- l
mittee known as the Lusitania survivors' Committee to represent .!
persons having claims arising out of the Lusitania" disaster ik"
against the German Government and the Cunard Steamship Comeio|
pany, Ltd., he directed Hunt, Hill & Betts, the attorneys for said
Committee, to file a summons on behalf of the claimant against theiiJ





203


Cunard Line, which was done the following day. Subsequently, the
claimant, on June 16, 1916, signed a general form of agreement pre-
pared for execution between Lusitania claimants and the Committee
under the terms of which the claimant authorized the Committee to
retain attorneys to represent it and also to prosecute her claim as her
attorneys against the German Government (either through the State
Department of the United States or otherwise) or against the
Cunard Steamship Company, Ltd., or both, and to pay as compen-
sation for counsel so retained a portion of the ultimate recovery on
her claim not to exceed in any case twenty per cent of such recovery
as may be had from the German Government, and not to exceed
thirty-three and one-third per cent of such recovery as may be had
against the Cunard Steamship Company, Ltd., said compensation to
include the compensation of any individual counsel already retained,
and the division of such compensation between the counsel for the
committee and such individual counsel to be arranged for by a sep-
arate agreement. This agreement further provided that every
claimant upon signing it should pay the Committee $25.00 for nec-
essary expenses in prosecuting the claims, and any claimant elect-
ing to bring suit against the Cunard Steamship Company should
pay $10.00 additional (which was required as a deposit in the Fed-
eral Court). An additional provision of this agreement provided
that where, in the opinion of the Committee the provable value of
the claim was more than $10,000 and did not exceed $50,000, as in
this case, the claimant was to pay a further assessment of not to
exceed $50.00, without the further specific consent of the claimant.
It was in accordance with these provisions of this agreement regard-
ing expenses that the claimant has, as above indicated, paid the sum
of $85.00 for disbursements.
Messrs. Hunt, Hill & Betts were the counsel retained by the Com-
mittee above mentioned, and in accordance with the provisions of
the aforesaid agreement regarding compensation of individual coun-
sel previously employed by the claimant, Messrs. Hunt, Hill & Betts
agreed to pay Mr.'Lincoln McCormack as compensation for his serv-
ices one-third of the amount received by them as a fee for their
services. No other fees and no disbursements are claimed to be due
to Mr. McCormack.





204 "1

It therefore appears from the situation thus disclosed that in fixing:. !
the fee to be paid to these attorneys it is necessary to take into con-
sideration not only the services rendered by Messrs. Hunt, HilJ & A.
Betts, but also the services rendered by their predecessor and asso- *:
ciate.
In fixing the fee for these attorneys the American Commissioner N
cannot take into consideration the work done by these attorneys in '
connection with the suit brought in the District Court for the South-
ern District of New York against the Cunard Steamship Company,
Ltd., because in the first place the provisions of Section 9 of the
"Settlement of War Claims Act of 1928 limit the authority of the ,
American Commissioner to the fixing of fees for services rendered
only in proceedings before this Commission and, in the second place
because, so far as their services in the Cunard Steamship Company
case were concerned, the payment of any fee to these attorneys was,
according to the terms of the services agreement, contingent upon
a recovery from the Steamship Company which was not obtained.
The American Commissioner also holds that the services which
these attorneys allege they rendered after the award by this Com-
mission was made, in the preparation of the escrow agreement by
which the amount of the fee in dispute is held pending the fixing
of their fee in this proceeding, and their services in attempting to I
bring about legislation for the payment of the award and in present-
ing their contentions in this proceeding, cannot be considered in fix-
ing the fee because such services were performed as much in the in- V
terest of the attorneys as of the claimant and are not therefore
properly chargeable to the claimant.
The checks issued by the Treasury Department in payment of the
award in this case totalled $15,801.71; the maximum fee of twenty '
per cent allowed under the above mentioned services agreement, .
therefore, amounts to $3,160.34. These attorneys now ask that their IR
fee be fixed at $4,500 because they allege "that Mrs. Dugger has A
repudiated the contract between herself and deponent's firm," pre- i
sumably by her request to the American Commissioner under the
authority of the "Settlement of War Claims Act of 1928," to fix her
attorneys' fee, and because that "is the amount which would have (
been charged on a time basis ".





205


The services rendered by these attorneys which can be taken into
consideration in fixing a reasonable fee in this case include the
following:
According to the affidavit filed in this proceeding by Mr. Mc-
Cormack, shortly after he was employed by the claimant in January,
1916, he asked the Department of State for information about filing a
claim for the personal property lost by the claimant through the
'sinking of the "Lusitania ", and on January 19, 1916, he received a
reply from the Department of State, and drafted a memorial, which,
however, apparently was never filed with the Department, unless it
was the same memorial which Messrs. Hunt, Hill & Betts filed with
the Department on August 31, 1916. Thereafter, apparently, nothing
was done about the prosecution of this claim until the Department of
State wrote to Messrs. Hunt, Hill & Betts on July 24, 1920, advis-
ing them that the memorial as filed was not in proper form, and was
not supported by satisfactory evidence. The Department accordingly
returned the memorial, and sent a set of the forms which had been
prepared by the Department. for applications in support of claims
against foreign governments, containing complete instructions for
the preparation of a formal diplomatic claim.
These forms were filled out by these attorneys in accordance with
the Department's instructions, and were verified by the claimant on
December 13, 1920, but through some oversight they were not filed
with the Department of State at that time.
When this Commission was organized two years later these attor-
neys again wrote to the Department about this claim, and, finding
that no petition was then on file, the application which had been
prepared in 1920 was looked up, and on October 17, 1922, that peti-
tion, together with a power of attorney verified by the claimant on
October 14, 1922, which was attached to the aforesaid application as
Exhibit A, was forwarded to the Department of State together with
the claimant's birth certificate and an affidavit by the claimant's
mother showing the property lost and its value. This application
and the accompanying documents were duly forwarded by the
Department of State for presentation before this Commission.
Up to that time the only claim made by this claimant was for the
value of the property lost, but on October 15, 1922, the claimant





206


wrote to these attorneys, calling attention to this fact, and expressing::
the desire to have a claim filed on her behalf for personal injuries us
well, if it was not then too late to file such claim. The attorneyS
replied that it was not too late to file a claim for her personal injuries, ':
and they at once proceeded to secure affidavits from competent wit;
nesses showing the character and extent of the injuries suffered by .
the claimant. The attorneys pressed this inquiry with vigor, and .Z
their efforts were so successful that within two months thereafter .
they had secured sufficient evidence from the doctors who had at&-
tended the claimant at the time of the disaster and from other compe- :
tent, witnesses to satisfactorily establish the character and extent of .:
the injuries suffered by her. Accordingly, they prepared a petition
asking for $25,000 damages for the claimant on account of her per-
sonal injuries, which petition was sworn to by the claimant oi
December 18, 1922, and was filed by these attorneys with the Depart-"
ment of State on December 27, 1922, accompanied by the supporting ;4
affidavits and documents, which petition was duly forwarded by the 'A
Department of State to this Commission. .....
According to the records of this Commission no further action
was taken by this Commission on either item of this claim until |
July 31, 1923, when the American Agent wrote to these attorneys
asking for additional information as to the earning capacity of the
claimant, both before and after the injuries were suffered, and also
what, if any, accident insurance had been collected by her on account
of such injuries. The attorneys at once took these questions up with ,
the claimant, and on September 26, 1923, filed with the American 61.
Agency an affidavit by the claimant's mother as to the earning
capacity of the claimant and an affidavit by the claimant showing that
she carried no accident insurance. .
Meanwhile, on June 4, 1923, the claimant had married a Lieutenant.
in the United States Navy, Greene Williams Dugger.
The Act of Congress of September 22, 1922, relative to thA
naturalization and citizenship of married women, provided that a
woman citizen of the United States shall not cease to be a citizens
of the United States by reason of hlr marriage to an alien after the,
passage of that Act unless she makes a formal renunciation of her
citizenship before a court having jurisdiction over naturalization of `"t:
aliens. The American Agency, accordingly, required proof from ]A






207


the claimant, either that her husband was not an alien, or, if he was,.
that she had not made a formal renunciation of her citizenship.
These attorneys were able to produce satisfactory proof, by the
affidavits of competent witnesses, that the claimant's husband was an
American citizen, which proof was filed in part by them, with the
American Agency on September 26, 1923, and the balance of such
proof was filed on October 15, 1923.
Shortly thereafter this claim was taken up for consideration
between the German Agent and the American Agent. In accordance
with the policy which had been adopted by the German Agent in
dealing with Lusitania claims, he raised no question as to the claim
for property lost and its value, and he also stated that. he would not
oppose an award for a suitable sum as compensation for personal
injuries sustained by the claimant, but he contended that the injuries
shown were not permanent in their nature, and that for that reason
he could not agree to an award for that item of the claim. The case
was thereupon submitted to the Commission, and upon a disagree-
ment between the American Commissioner and the German Com-
missioner as to the amount to be awarded for personal injuries, it was
certified to the Umpire for decision. On February 21, 1924, the
Umpire rendered the decision of the Commission, pursuant to which
an award was entered on behalf of the claimant for the amounts
hereinbefore stated.
The records of this Commission and the information presented by
the attorneys and the claimant in this proceeding show that nothing
of importance was done in the presentation and prosecution of this
claim prior to October, 1922, when the claim for personal property
lost was filed.
As shown above, the petition originally filed in 1916 had been
returned by the Department of State. as insufficient under its prac-
tice and regulations, and the application prepared and sworn to in
1920 was not filed with the Department until 1922, when this Com-
mission was organized.
During the years 1916, 1917 and 1918 an active and extensive
correspondence was carried on between these attorneys and Mr.
McCormack, the claimant's original attorney, who acted as inter-
mediary between them and the claimant., because the claimant her-
self during the greater part of that period was residing abroad or






208


in Oregon, where. Mr. McCormack had his law office. It is to bd
noted, however, that all of the correspondence so carried on during
those years related exclusively to the proceedings brought in the
United States District Court in New York against the Cunard Steam-
ship Company. These services, accordingly, can not be considered
in fixing the fee of these attorneys for services rendered in the pre-
sentation and prosecution of the claim before this Commission.
The award for personal property lost was based upon a printed
form of application furnished by the Department of State and filled
out by these attorneys in accordance with detailed instructions con-
tained therein, and supported by a single short affidavit prepared
by these attorneys and sworn to by the claimant's mother. The
German Agent, as above stated, accepted this proof as satisfactory,
and agreed to recommend an award for the amount claimed without.
question and pursuant to a policy adopted by him in all Lusitania
claims. No brief or argument on the part of the attorneys was
called for in securing the award for this item of the claim. In these
circumstances the American Commissioner is of the opinion that
the services of these attorneys with respect to the collection of dam-
ages for personal property lost should be valued on the basis of a
contingent collection fee for recovering a judgment on an undisputed
indebtedness where the judgment is voluntarily paid without further
proceedings by the attorney.
On the other hand, the services rendered by these attorneys in se-
curing an award for personal injuries suffered by the claimant stand
on a distinctly different basis. The objection raised by the German
Agent to this item of the claim indicates the difficulty encountered
in securing an award. This difficulty was overcome solely through
the evidence procured and presented by these attorneys, who, as the
record shows, devoted a very substantial amount of time, and demon-
strated much energy and legal ability, in obtaining that evidence.
The legal services agreement under which their services were ren-
dered provided that the attorneys' fee was to be contingent upon a
recovery, but did not fix the fee ,at a definite percentage of the
amount recovered. It merely fixed twenty per cent of the amount
recovered as the maximum, which the fee was not to exceed. In
other words, the agreement contemplated that a fee not to exceed
that maximum of twenty per cent was to be fixed after the services





209


were rendered and was to be based on their actual value, taking into
consideration the contingent character of the arrangement.
Considering the character and value and extent of the services
rendered by these attorneys, the American Commissioner is of the
opinion that the maximum fee of twenty per cent of the amount
recovered for personal injuries would be a reasonable fee and justi-
fied in the circumstances, but that the maximum fee of twenty per
cent of the recovery for the value of lost personal property would be
excessive and not justified in the circumstances.
Now, therefore, in view of the considerations above set forth,
and that the payment of any compensation to these attorneys was
contingent upon securing and collecting an award, and in view of
the considerations stated in the general Jurisdictional and Adminis-
trative Decision rendered by the American Commissioner under date
of September 28, 1928, and after careful examination and full con-
sideration of the information furnished in this proceeding by the
attorneys and the claimant and by the records of this Commission
pertinent to the questions involved, and after due deliberation
thereon.
The American Commissioner decides and fixes as the reasonable
fee to be paid by the claimant, Dorothy Conner Dugger, to her said
attorneys, Hunt, Hill & Betts, the sum of Two thousand eight hun-
dred dollars ($2,800), the said fee to be paid by the claimant and
received by the attorneys as full compensation for all services ren-
dered 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 26th day of February, 1929.
CHANDLER P. ANDERSON,
American Commissioner,
Mixed Claim Comonissio-,
United States and Germany.




UNIVERSITY OF FLORIDA



3 1262 08484 2144









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