O'BRIEN v. Plumides

339 S.E.2d 54 (1986)

Cathy Surls O'BRIEN v. Michael G. PLUMIDES.

No. 8526SC580.

Court of Appeals of North Carolina.

February 4, 1986.

Jean B. Lawson, Charlotte, for plaintiff-appellant.

*55 Michael G. Plumides, Charlotte, pro se.

MARTIN, Judge.

Although plaintiff assigns error to the entry of summary judgment against her, she does not earnestly argue the issue as it relates to her claim for breach of contract. She contends, however, that she is entitled to recover a portion of the fee which she paid to defendant to the extent that it exceeds the reasonable value of the services which he rendered up to the time of his discharge from employment. We agree.

In Higgins v. Beaty, 242 N.C. 479, 88 S.E.2d 80 (1955), our Supreme Court held that if an attorney employed under a fixed fee contract is discharged by his client, without cause, prior to the disposition of the case, the attorney is entitled to the full contract fee and not merely the value of the services which he provided. The decision in Higgins was based on the theory that the general law of contracts, and damages upon breach, applies to a contract for legal services. However, in Covington v. Rhodes, 38 N.C.App. 61, 247 S.E.2d 305, (1978), disc. rev. denied, 296 N.C. 410, 251 S.E.2d 468 (1979), this Court cited decisions following a modern trend and holding a client's discharge of his attorney is not a breach of contract.

`Such a discharge does not constitute a breach of contract for the reason that it is a basic term of the contract, implied by law into it by reason of the special relationship between the contracting parties, that the client may terminate the contract at will.' (citation omitted).

Id. at 65, 247 S.E.2d at 308. Accordingly, this Court held that "[t]he client has the right to discharge his attorney at any time, and ... upon such discharge the attorney is entitled to recover the reasonable value of the services he has already provided." Id. at 66, 247 S.E.2d at 309.

`The rule secures to the attorney the right to recover the reasonable value of the services which he has rendered, and is well calculated to promote public confidence in the members of an honorable profession whose relation to their client is personal and confidential.' (citation omitted).

Id. Although Covington dealt with a contingent fee contract, we believe that the same rules are applicable to a fixed fee contract such as is involved in this case.

Moreover, since the decision in Higgins, our Supreme Court has implicitly adopted the modern rule. By order dated 30 April 1973, the Supreme Court approved the adoption of the North Carolina State Bar Code of Professional Responsibility (The Code). 283 N.C. 783 (1973). The Code, as amended in N.C.G.S. Rules (1984), applicable at all times relevant to this case, provides: "A lawyer who withdraws from employment shall refund promptly any part of a fee paid in advance that has not been earned." DR 2-109(A)(3). According to the Code, a lawyer withdraws from employment if "[h]e is discharged by his client." DR 2-109(B)(4). These provisions have been carried forward by the Rules of Professional Conduct of the North Carolina State Bar, which were approved by the Supreme Court on 7 October 1985. ___ N.C. ___ (1985). See Rules of Professional Conduct of the North Carolina State Bar, Rule 2.8(A)(3) and (B)(4). Neither the Code, nor its successor Rules of Professional Conduct, limit the applicability of these rules to contingent fee contracts. Although Higgins has not been expressly overruled, we do not believe that its holding reflects current North Carolina law.

Accordingly, we hold that where an attorney, employed under a fixed fee contract to render specific legal services, is discharged by his client prior to completion of the services for which he was employed, he is entitled to compensation for the reasonable value of the services rendered up to the time of his discharge. The reasonable value of the services rendered is a question of fact to be determined in the light of the circumstances of each case.

For the reasons stated, summary judgment for the defendant is reversed and this case is remanded to the Superior Court of Mecklenburg County for trial on the issue of the reasonable value of the services rendered *56 by defendant up to the time of his discharge.

Reversed and Remanded.

HEDRICK, C.J., and EAGLES, J., concur.