Lawyers Win Contingency Fee Fight Against Estate of Blues Icon's Son

In 2000, the Mississippi Supreme Court upheld a Leflore County Chancery Court ruling that Claud indeed was Robert's biological heir. In 2008, Kitchens & Ellis assigned its contingency agreement rights to the Kitchens Law Firm.

After Claud died in 2015, his estate (the probate court in Copiah County, MS, appointed Claude's son Michael the executor), blocked Kitchens from receiving the 40% contingency fee. The law firm in turn filed a motion with the court for an accounting and for the contingency fee payments.

Both sides filed summary judgment motions. Claud's estate argued that Kitchens hadn't properly followed the procedural requirements of Mississippi's probate law, including a 90-day filing deadline. Kitchens countered it "was not required to probate a claim because the funds due it, now and in the future, are not now, nor have they ever been, part of [Claud]'s estate."

The Copiah County Court sided with Kitchens. Affirming, the Court of Appeals of Mississippi noted: "When Claud entered the contract in 1991, he agreed to [s]et over and assign unto said firm of Kitchens & Ellis, causes of action or rights in the amount of forty percent (40%) of any and all sums of money or other benefits which they may recover or obtain for me by virtue of, or arising from, my biological relationship to the late Robert Johnson."

As a result, the appeals court decided: "Kitchens is the rightful owner to the funds that it claims. In other words, the funds are not, and never were, part of Claud's estate — they are merely being wrongfully withheld, contrary to the assignment, by the estate. Because the funds are not a part of Claud's estate, Kitchens was not required to probate its claim."

But Claude's estate also argued Kitchens had neither privity of contract with the estate nor a vested interest in the contingency fee agreement — which the estate claimed should in any case be voided as excessive, on the ground that the $2 million Kitchens already retained under the agreement should be "more than enough compensation for the legal services actually rendered" to Claud.

The Mississippi appeals court knocked these arguments down, too. "Indeed, no one raised privity or any other issue with the contract assignment before Claud died on June 30, 2015," the appeals court noted, "even though Kitchens stepped into the shoes of Kitchens & Ellis and retained 40% of all monies received 'by virtue of … [Claud's] biological relationship to the late Robert Johnson,' while sending checks to Claud for his 60% portion."

On the vested interest issue, the estate argued there was "nothing preventing the Estate or heirs from canceling or voiding any royalty contracts with any record companies or other third-party entities. Under such a scenario, Kitchens would have no royalty payments from which to claim a fee from." But the appeals court reasoned: "Based on the plain language of the [contingency fee] contract, we find that Kitchens's right to payment under the contract vested when Claud was finally determined to be Robert's heir."

Finally, on whether the contingency fee agreement was excessive, the Mississippi appeals court admonished that "'more than enough' — as defined by Claud's estate — is not the standard for determining unconscionability of a contract or the reasonableness of attorney's fees." Instead, "[t]he estate's bare assertion of unreasonableness falls short of showing any unconscionability," the appeals court decided. "To the contrary, Claud knowingly signed the contract. Claud also received great benefit from the contract, recouping millions of dollars after being determined Robert's heir. And contrary to the estate's contentions, the record reflects that the determination of Claud's heirship was heavily litigated for over a decade under challenging circumstances. Kitchens & Ellis undertook representing Claud in the heirship matter despite the high risk of no return at all."

Thus, the mystery of whether the law firm could continue its contingency fee position was solved, at least for purposes of Robert Johnson's estate. For a dispute involving the blues icon's estate, it can certainly be said that the devil was in the details.

*****

Stan Soocher is Editor-in-Chief of Entertainment Law & Finance and Professor of Music & Entertainment Studies at the University of Colorado's Denver Campus. For more information: http://www.stansoocher.com.