An attorney may not collect $136,000 in legal fees from a custody case, a bankruptcy judge has ruled, because he failed to follow the rules.
U.S. Bankruptcy Judge Robert D. Drain ruled in favor of Adam S. Thiessen and, indirectly, Doreen J. Kendall, both of Yorktown Heights, and against Manhattan attorney Andrew M. Molbert.
“Lawyers of course serve a critical role in resolving conflicts under the rule of law,” Drain wrote in a Jan. 3 decision, and “should be paid fairly for their work.
But in the highly charged matters of family courts, “New York has determined that actions such as Mr. Molbert’s … are so inimical to, or at least incompatible with, the rule of law as to require the forfeiture of then-unbilled fees and expenses as a check against such actions ever being taken.”
Molbert did not respond to an email request for comment.
Kendall hired Molbert in 2008 to represent her in a custody and child support case. She paid a $2,500 retainer and agreed to an hourly rate of $250.
Two days before the trial was to begin in Yonkers family court in 2009, Thiessen – who is not the father of the child and who Kendall calls her “significant other” – signed a guarantee to pay her legal fees.
Thiessen, a Yonkers school teacher, petitioned for Chapter 13 bankruptcy protection in 2018, declaring $24,078 in assets and $133,582 in liabilities.
Molbert then submitted a $136,215 claim for unpaid legal fees and expenses from the Kendall case.
Thiessen objected on several grounds. The fees were unreasonable, in light of the $95,470 already paid. Molbert’s time entries were insufficiently detailed. He had little experience in domestic relations matters. He had fraudulently induced Thiessen to guarantee the legal fees. He had failed to bill Kendall every 60 days, as required by the retainer. He had improperly obtained signatures on confessions of judgment that secured the legal fees.
Molbert disputed each allegation.
Kendall bolstered Thiessen’s position in a declaration filed last year. She stated, for instance, that Molbert had assured her that he was experienced in custody and child support matters, but later admitted that he had only handled a couple of cases. She said the 718.7 hours he claimed to have spent on the case were “unbelievable.”
Thiessen, she claimed, had called her from Molbert’s office two days before the trial and said Molbert was demanding a confession of judgment to secure his legal fees. Thiessen purportedly said Molbert had made veiled threats to withdraw as her attorney on the eve of the trial because he was concerned about being paid.
“I feared that if I failed to accede to Mr. Molbert’s demands that he would not zealously represent me and I would lose custody of my son. I felt that Mr. Molbert was extorting Mr. Thiessen and me.”
She authorized Thiessen to sign her name to a confession of judgment that left a blank space for the amount to be paid.
Without more evidence, Drain stated in his ruling, he could not rule on most of Thiessen’s objections to Molbert’s fees. But on the legality of the confessions of judgment, he said the facts are uncontested.
The rules of practice in domestic relations cases obligate lawyers to satisfy three requirements when they secure fees with a confession of judgment.
The retainer must specify that the lawyer may seek a security interest. The other spouse must be notified. The court must approve the deal.
In this instance, Drain found, Molbert complied with none of the requirements. Molbert had even acknowledged that the confessions of judgment are not enforceable, but “he would not have had them sign the judgments,” Drain noted, “unless intending to leave the opposite impression.”
Drain quoted an appellate court ruling that says the rules “were designed to address abuses in the practice of matrimonial law and to protect the public.”
In violating the rules, Drain said, Molbert was precluded from collecting his legal fees and expenses.
Thiessen was represented by Carlos J. Cuevas of Yonkers. Molbert represented himself.