Ravich v. Gourvitz

Annotate this Case

SYLLABUS

(This syllabus is not part of the opinion of the Court. It has been prepared by the Office of the Clerk for the convenience of the reader. It has been neither reviewed nor approved by the Supreme Court. Please note that, in the interests of brevity, portions of any opinion may not have been summarized).

Ravich, Koster, Tobin, Oleckna, Reitman & Greenstein, P.C. v. Elliot Gourvitz (A-45-96)

Argued November 4, 1996 -- Decided December 16, 1996

PER CURIAM

The issue addressed in this appeal is whether a certified civil trial attorney is required to pay the referring attorney the agreed upon referral fee if the matter handled by the certified attorney was matrimonial in nature.

In October 1988, Ninette Hoff consulted Michael Tobin, Esq., of the law firm of Ravich, Koster, Tobin, Oleckna & Greenstein, P.C. (Ravich), formerly Shevick, Ravich, Koster, Tobin, Oleckna and Reitman. Hoff was seeking representation in a matrimonial action. Ravich chose not to represent Hoff but, instead, referred her to Elliot Gourvitz, a certified civil trial attorney. When contacted by Tobin, Gourvitz, a member of the law firm of Gourvitz & Braun, represented that a 25" referral fee would be paid to Ravich as the money was received from the client.

On October 17, 1988, Gourvitz personally signed a letter acknowledging the referral and memorializing the agreement between he and Ravich. The division of fees was to be governed by Rule 1:39-6(d), which provides that a certified civil or criminal trial attorney can forward a fee to a referring attorney without regard to the services rendered to the client by the referring attorney.

As determined by the District Fee Arbitration Committee, Gourvitz earned a total fee in the Hoff litigation of $29,271. Pursuant to the terms of the agreement, the referral fee to be paid Ravich was $7,317.75. Gourvitz paid Ravich a total of $2,110.25, leaving a balance due of $5,207.50.

Ravich filed this lawsuit against Gourvitz to recover the $5,207.50 fee plus interest. Gourvitz filed an answer; he did not allege an affirmative defense that the agreement was unenforceable. During a pretrial conference, the parties stipulated to certain facts. Specifically, the parties agreed that the figures set forth in Ravich's statement of facts were accurate and acceptable; at the time of the offer and acceptance of the agreement, Gourvitz was a member of Gourvitz & Braun; and Gourvitz acknowledged his obligation up to the amount that had been paid to him while a member of the Gourvitz & Braun partnership. At issue was whether Gourvitz was personally liable for the balance due Ravich on the entire obligation or whether his liability terminated after Gourvitz became a member of a professional association, a successor firm to Gourvitz & Braun, which took over the representation of the client but has since dissolved and has no assets.
On May 17, 1995, the trial judge concluded that Rule 1:39-6(d) does not extend to Family Part matters and that there was no authority in the rules to allow the payment of referral fees in matrimonial matters. Based on its holding, the court dismissed Ravich's complaint with prejudice.

Ravich appealed to the Appellate Division, arguing that Rule 1:39-6(d) applies to the referral of a matrimonial matter to a certified civil trial attorney and that Gourvitz is personally liable for the fees based on the agreement he signed personally.

A majority of the Appellate Division reversed and remanded to the trial court to have a judgment entered in favor of Ravich in the amount of $5,207.50 plus interest. The majority concluded that the trial judge had interpreted Rule 1:39-6(d) too restrictively. The majority found that R. 1:39-6(d) does not prohibit

payment by a certified civil trial attorney, although solely a matrimonial practitioner, of a referral fee to the referring attorney. According to the panel, Ravich justifiably believed that the agreement was enforceable and would be honored by Gourvitz. Furthermore, the majority concluded that the fact that the Supreme Court recently approved certification for matrimonial attorneys and prohibited referral fees in matrimonial action in the future does not mean that the referral fee was prohibited when the Hoff case was litigated, nor does it mean that Rule 1:39-6(d) should not be enforced according to its plain meaning. Further, the majority held that Gourvitz is personally liable for the fee pursuant to the clear and unambiguous language of the agreement that he signed.

Judge Michels dissented, finding that the trial judge properly held that Ravich was not entitled to the referral fee in a matrimonial action. Judge Michels believed that Rule 1:39-6(d) should not be read or construed to permit referral fees in matrimonial actions because such fees will not only increase the costs to matrimonial litigants, but will undermine the dignity and erode public confidence in the legal profession.

HELD: Judgment of the Appellate Division is affirmed substantially for the reasons set forth in the written opinion below. According to its plain meaning and prior to its recent amendments, Rule 1:39-6(d) did not prohibit the forwarding of a referral fee by a certified civil trial attorney in a matrimonial action.

1. This holding has limited application because the recent amendments to Rule 1:39-6(d) expressly prohibit the payment of referral fees in matrimonial matters. (p. 1)

2. The Court's disposition is also influenced by representations made by the parties during oral argument. Gourvitz informed the Court that he wished to pay the referral fee provided its payment did not constitute the unauthorized splitting of fees. Ravich informed the Court that it pursued this litigation as a matter of principle and, if successful, would forward any payment to the client. Based on Ravich's representation, Judge Michel's concern over the potential of increased fees to the matrimonial client has been obviated in this case. (pp. 2-3)

Judgment of the Appellate Division is AFFIRMED.

CHIEF JUSTICE PORITZ and JUSTICES HANDLER, POLLOCK, O'HERN, GARIBALDI, STEIN and COLEMAN join in this per curiam opinion.


SUPREME COURT OF NEW JERSEY
A- 45 September Term 1996

RAVICH, KOSTER, TOBIN, OLECKNA,REITMAN &
GREENSTEIN, P.C.,

Plaintiff-Respondent,

v.

ELLIOT H. GOURVITZ,

Defendant-Appellant.

Argued November 4, 1996 -- Decided December 16, 1996

On appeal from the Superior Court, Appellate Division, whose opinion is reported at 287 N.J. Super. 533 (1996).

Elliot H. Gourvitz argued the cause pro se.

Michael N. Tobin argued the cause for respondent (Ravich, Koster, Tobin, Oleckna, Reitman & Greenstein, attorneys; Bruce W. Radowitz, on the brief).

PER CURIAM

We affirm the judgment in favor of respondent substantially for the reasons set forth in the Appellate Division opinion. 287 N.J. Super. 533 (1996). That court's holding has limited application because, as it noted, id. at 538, the recent amendment to Rule 1:39-6(d) expressly prohibits the payment of referral fees in matrimonial matters.

Our disposition is also influenced by representations made to the Court during oral argument. Appellant, appearing pro se, informed the Court that he wished to pay the referral fee provided that the payment did not constitute the unauthorized splitting of fees. Respondent's counsel informed the Court that his client was pursuing the litigation as a matter of principle and, if successful, would remit any payment to the client.
One of the detrimental effects of fee splitting that concerned the dissenting member of the Appellate Division was the potential that fees to clients would be increased to cover the cost of the referral fee. Id. at 543 (Michels, J., dissenting). Based on the representation of respondent's counsel, that concern has been substantially obviated in this case because the balance of the referral fee will be remitted to the client.
Judgment affirmed.
CHIEF JUSTICE PORITZ and JUSTICES HANDLER, POLLOCK, O'HERN, GARIBALDI, STEIN and COLEMAN join in this per curiam opinion.

SUPREME COURT OF NEW JERSEY

NO. A-45

SEPTEMBER TERM 1996
ON APPEAL FROM Appellate Division, Superior Court
ON CERTIFICATION TO

RAVICH, KOSTER, TOBIN, OLECKNA, REITMAN &
GREENSTEIN, P.C.,

Plaintiff-Respondent,

v.

ELLIOT H. GOURVITZ,

Defendant-Appellant.

DECIDED

December 16, 1996
Chief Justice Poritz PRESIDING
OPINION BY Per Curiam
CONCURRING OPINION BY DISSENTING OPINION BY
CHECKLIST
Affirm CHIEF JUSTICE PORITZ X JUSTICE HANDLER X JUSTICE POLLOCK X JUSTICE O'HERN X JUSTICE GARIBALDI X JUSTICE STEIN X JUSTICE COLEMAN X TOTALS
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