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WARTHEN v. HIGH POINT — Were Arbitration Attorney Fees Misawarded?

Thursday, January, 26, 2012

In the recent Warthen v. High Point Insurance Company arbitration, attorney fees were sent to the wrong law firm, according to the apellant, Shanta Warthen (by Phoenix Physical Medicine). At issue in this statement was that the apellant's attorney, Harris Legome, began working on this case while employed at Wallace & Legome and changed firms to join Friedman, Spalletta & Legome while working in the arbitration. The attorney fees were sent to the previous law firm, rather than the new one.


The Arbitration Proceeding and Award


The plaintiff, Shanta Warthen, received medical treatment from Phoenix Physical Medicine for injuries she sustained in a car accident which happened on May 19, 2006. She had an insurance policy with High Point Insurance which included personal injury protection coverage. High Point Insurance rejected Phoenix Physical Medicine's claim for $516.06 in medical services. In the arbitration attorney's decision, Phoenix Physical Medicine was awarded $292.03 for medical services, $240 for the arbitration fee, and $1375 in attorney's fees. High Point Insurance paid the legal fees directly to Wallace & Legome, who had originally filed the arbitration demand. Wallace & Legome endorsed and deposited the check.


Plaintiff Files Action for Arbitration Award


After this, the plaintiffs sought recovery of the attorney's fees and costs from High Point Insurance. They claimed that High Point should have known that law firms were changed during the arbitration due to the new law firm's stationery being used during the arbitration. Neither High Point nor its attorneys were officially informed of this change. High Point Insurance filed for a dismissal of the complaint. The trial court dismissed Warthen and Phoenix Physical Medicine's complaint. This was on the grounds that the issue was not between Phoenix and High Point, but between the two law firms. Ultimately, if Mr. Legome was not paid through Wallace & Legome for his services in this case, it is up to him to seek reimbursement from his former employer, and this should not be the concern of the plaintiff.