Liska

May a chent who loses a binding fee arbitration conducted pursuant to the mandatory fee arbitration statute (MFA), Business and Professions Code section 6200 et seq., file a subsequent action against the attorney predicated on the same allegations of misconduct or breach of contract that formed the basis of the fee dispute? We hold that the chent may do so, but that the chent may not seek to recover as damages any portion of the fee that the arbitrators awarded the attorney.

Plaintiff George Liska hired the defendant law firm to represent him in a personal injury products liability action. The matter was settled after a trial date had been set but before trial began, which under the retainer agreement entitled the firm to a higher percentage of the settlement than if the matter had been settled before there was a trial date. Liska disputed the fees and demanded arbitration. The arbitrators found in favor of the firm. After the arbitrators’ award became final, Liska filed suit against the law firm and several of its individual attorneys (collectively the firm), alleging causes of action for breach of contract and fraud. The firm demurred on the grounds that the suit was…