The Meaning Of Award

The word “award” is not ambiguous, according to a recent opinion of the New York Appellate Division for the Second Judicial Department in affirming a decision not to award a portion of settlement proceeds to a law firm.

The respondents, previously represented by the plaintiff, had commenced a lawsuit against the Town of Riverhead and Suffolk County, and thereafter settled the action. The plaintiff commenced this action to enforce the contingency provision of the parties’ retainer agreement. The retainer agreement provided for a contingency fee to be paid to the plaintiff “not to exceed twenty percent . . . of any award . . . granted.” The respondents contended that the contingency fee provision was not applicable because no award had been granted; rather, the action had been discontinued pursuant to the terms of the settlement.

The Supreme Court correctly found that, pursuant to the plain language of the parties’ retainer agreement, no contingency fee was owed to the plaintiff, as no “award” had been given to the respondents (citation omitted) The term “award” is clear and unambiguous and, in common parlance, does not include proceeds paid to purchase real property, whether to settle a lawsuit or otherwise (see Black’s Law Dictionary 164 [10th ed 2014]). Moreover, the plain meaning of “award” is consistent with another provision of the parties’ retainer agreement which provided that, upon any settlement of the matter, the plaintiff was to be compensated on an hourly basis.

The attorneys may still prove up entitlement to fees on a hourly basis. (Mike Frisch)