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DIVISION OF ST THOMAS AND ST JOHN ******‘k******* GO FAST CHARTERS LLC, ) )CASE NO ST 2010 CV 00672 Plaintiff, ) )ACTION FOR BREACH OF vs )CONTRACT NEGLIGENCE )TRESSPASS NUISANCE TEXACO CARIBBEAN INC ) )JURY TRIAL DEMANDED Defendant ) Cite as 2024 VI Super 26U MEMORANDUM OPINION 111 THIS MATTER is before the Court on 1 Plaintiff Go Fast Charters, LLC 8 Motion to Strike Kellerhals Ferguson Kroblin PLLC s Assetted Attomey’s Lien, filed December 4, 2018; 2 Kellerhals Ferguson Kroblin PLLC 3 Reply to Opposition to Motion for Summary Judgment on Attorney 8 Lien & Opposition to Motion to Strike Attomey’s Lien, filed December 28 2018 3 Plaintiff Go Fast Charters, LLC’s Supplement Submission in Support of Plaintiff’s Motion to Strike Kellerhals Ferguson Kroblin PLLC’s Asserted Attomey’s Lien, accepted by Order issued January 29, 2024, 4 Plaintiff Go Fast Charters, LLC’S Post Hearing Proposed Findings Of Fact And Conclusions Of Law filed June 17, 2024; 5 Plaintiff Go Fast Charters LLC s Post Hearing Brief In Support Of Plaintiff’s Motion To Strike Kellerhals Ferguson Kroblin PLLC’S Asserted Attorney 5 Lien, filed June 17 2024 6 Kellerhals Ferguson Kroblin PLLC’s Findings Of Fact & Conclusions Of Law, filed June 20 2024' and 7 Kellerhals Ferguson Kroblin PLLC’s Post Hearing Closing Argument And Brief, filed June 20 2024 1|2 The Court finds that the contingency fee agreed to between the parties in this matter was dependent on damages being awarded at a jury trial As there was no damages award, the charging lien is no longer valid and Plaintiff Go Fast Charters, LLC’s Motion to Strike Kellerhals Ferguson Kroblin PLLC s Asserted Attomey’s Lien, filed December 4, 2018, will be granted I INTRODUCTION fi|3 On November 29, 2010, Plaintiff Go Fast Charters LLC (‘ Go Fast ) filed suit against Defendant Texaco Caribbean, Inc (‘ Texaco”) on account of oil gasoline leakages from storage distribution, and pumping equipment operated by Texaco at a marina run by Go Fast Go Fast and Texaco eventually reached a settlement, and on July 10, 2017, the parties filed a Joint Stipulation and Motion To Dismiss, which was granted by this Court 3 Order on July 1 l, 2017 On April 19, 2018, Go Fast filed a motion to reopen the case for the limited purpose ofadjudicating an attorney 3 lien, which was asserted on the settlement proceeds by Go Fast’s former counsel, Kellerhals Ferguson Kroblin PLLC( KFK )on July 16 2014 1|4 On May 16, 2018, the case was reopened for the purpose of clarifying the attorney’s lien placed by KPK On September 19, 2022, the Court ordered the parties to provide briefs analyzing the common law right of an attomey’s lien under the Banks analysis framework ' On October 24, 2022, both KFK and Go Fast filed briefs analyzing the common law right to an attorney 3 lien On October I 1, 2023 this Court issued a Memorandum Opinion, 2023 VI Super 58, establishing the common law right to an attomey’s lien in the U S Virgin Islands An evidentiary hearing was scheduled for, and subsequently held on, January 18, 2024, to resolve whether KFK was entitled to an attomey’s lien The parties then submitted their post hearing briefings on June 17, 2024 II F[NDINGS OF FACT {[5 The Court makes the following Findings of Fact following the evidentiary hearing and upon review of the post hearing briefing 1 Go Fast hired KFK in November 2012 to represent it in litigation pending at the Superior Court (the “Go Fast case ’) The Go Fast case concerned leaking and spillage 0f oil/gasoline at a site which had been operated by Texaco 2 KFK sent Go Fast an engagement letter on November 29, 2012, which outlined the scope of their attorney client relationship and billing agreement (‘ 2012 Agreement”) In the 2012 Agreement, Go Fast agreed to pay KFK on an hourly basis, as well as a 59 0 contingency fee The 2012 Agreement stated ‘ ifyou are awarded damages in the case ’ then the firm is entitled to collect five percent (5%) “of any recovery ’ 3 At the time ofKFK s engagement, KFK had an attorney who was a partner at the firm, Leigh Fletcher (“Attorney Fletcher”), who had expertise in environmental law Attorney Fletcher prepared the engagement letter Paul Sabers was the representative ' The Virgin Islands Supreme Court has stated that before conducting a Banks“ analysis parties should be given a chance to brief the issue Malloy 1 Reyes 61 V 163 176 (V l 2014) ( Here, the Superior Court erred in failing to give the parties an opportunity to brief the issue of abandonment of an easement under the Banks framework, and for Go Fast who signed the 2012 Agreement and communicated with KFK on behalf ofGo Fast 4 Sometime between 2013 and January 1, 2014, Attorney Fletcher left KFI\ 5 KFK worked on the case from November 2012 to June 2014 Both Attorney Kellerhals and Attorney Christopher Allen Kroblin averted that the firm viewed the case as a business dispute and was ready to litigate it as such 6 Go Fast fell behind on payments to KFK Go Fast terminated its relationship with KFK in 2014 and retained new counsel Attorney Jack Dema ( Attorney Dema ’) KFK and Paul Sabers agreed to a one time lump sum payment of thirty five thousand dollars ($35,000) in return for a discount on the remaining balance of thirteen thousand two hundred ninety seven dollars and seventy two cents ($13,297 72) (the “2014 Agreement ’) The email also stated which bank account to wire the funds to and by what date the fimds were to be sent 7 1n the email establishing the 2014 Agreement, KFK additionally stated that “[a]s discussed previously, this discount is without prejudice to our previously agreed upon 5% lien on any recovery in the case, which we will still retain 8 Afier the 2014 Agreement was made KFK filed a Notice of Attomey’s Lien on July 16 2014 9 Upon receiving the lien notice, Paul Sabers sent an email on July 16, 2014, stating ‘ Chris, I don’t know why you felt this was necessary Your firm has been paid in full for all legal expenses I agreed that your firm was entitled to 5% in our original agreement with Leigh Fletcher Your lien states your encumbering the entire award I acknowledge your untitled [sic] to the 5% but that is the extent of your participation in any award or settlement I receive 1 want this spelled out more clearly in your lien please ’0 10 Attorney Dema approached the case from an environmental law perspective and re opened discovery, retained new experts, briefed issues involving the statute of limitations causation, the economic loss rule, implied in fact contract theory, the new business rule, and speculative damages 1 1 Go Fast settled the case in 2017 before trial 3 12 Paul Sabers testified at the hearing He stated that he negotiated the retainer agreement with Attorney Fletcher and that the reason he had retained KFK was because of her expertise in environmental law When asked about the agreement he stated this about ’ Plaintiff‘s Ex G the 5% lien “That if I were awarded damages, I guess to a jury trial afler the fact, that that would relate to the 590 based on awarded damages And that was the agreement It was never modified That was our agreement It was binding 13 Paul Sabers also testified that the meaning of “without prejudice was not explained to him and that he did not agree to any modification of the original agreement 3 contingent fee which he said was “based on damages awarded in a jury trial He further testified that it was not his understanding that the emails would obligate him to pay five percent (5%) of any settlement amount He further testified that as a businessman he would not trade a $13 297 72 discount for a $500 000 fee [[1 CONCLUSIONS OF LAW fi|6 Accordingly, the Court reaches the following Conclusions of Law following the evidentiary hearing and post hearing briefings l (1) Absent any statute or rule to the contrary of one or more elements of this right, which shall then control, (2) an attorney and client may arrange by express or implied written agreement that (3) the attorney shall have a lien for payment of costs and fees on the judgment, settlement, or other recovery of a client (4) in an amount not to exceed what is asserted in good faith and reasonable for work actually performed (5) and this lien takes effect at the commencement of the action Further, the attorney must (6) file and provide notice to any third party for the lien to be enforceable against that third party and (7) may not unreasonably impede any dispute regarding those fees or the lien Lastly, (8) the court or other tribunal in which judgment was received or, if settled, the case was commenced, may adjudicate any fee or lien dispute 4 2 Thus, to bring an action to recover fees via an attomey’s charging lien the attorney must have (1) a written agreement with a client, (2) there must have been a settlement or judgment; (3) there must be nonpayment of the attomey’s reasonable fees and costs; and (4) there must have been notice given to any relevant third parties 5 3 A fee may be contingent on the outcome of the matter for which the service is rendered, except in a matter in which a contingent fee is prohibited by Virgin Islands Supreme Court Rule 21 1 l S(d)", or other law A contingent fee agreement shall be in a writing signed by the client and shall state the method by which the fee is to be determined, including the 4 2023 VI Super 28 at 1] 46 5 Id at 1] 47 6 V I Supreme Court Rule 21 I l 5(d) of the Virgin Islands Rules of Professional Conduct states A lawyer shall not enter into an arrangement for, charge, or collect (1) any fee in a domestic relations matter the payment or amount of which is contingent upon the securing of a di\ orce or upon the amount of alimony or support, or property settlement in lieu thereof, or for 07 20 2024