Present: Carrico, C.J., Compton, Stephenson, Whiting, 1 Lacy, and
Keenan, JJ., and Poff, Senior Justice

STEPHEN WAINGER
                         OPINION BY JUSTICE ROSCOE B. STEPHENSON, JR.
                                        September 15, 1995

v.   Record No. 941615

GLASSER & GLASSER

             FROM THE CIRCUIT COURT OF THE CITY OF NORFOLK
                        John E. Clarkson, Judge


      In this litigation between a law firm and one of its former

partners, we determine when contingent legal fees have been

"fully earned" within the meaning of the firm's partnership

agreement.
      On June 24, 1992, Stephen Wainger filed a declaratory

judgment proceeding against Glasser & Glasser, a law firm in the

City of Norfolk, seeking an accounting to establish the balances

of his capital account and undivided profits account and a

judgment for any amounts due him as a result of his withdrawal

from the firm.    Wainger also sought a construction of the

partnership agreement declaring that he is entitled to a 6/91

share of the undivided profits from final, nonappealable consent

judgments and final settlements obtained against The Manville

Corporation Asbestos Disease Compensation Fund (the Manville

Trust) prior to his withdrawal (the Manville Trust fees).     In

addition, Wainger claims a right to a 10% bonus for those cases

against the Manville Trust that he handled personally.

      1
      Justice Whiting participated in the hearing and decision of
this case prior to the effective date of his retirement on August
12, 1995.
        On the same date, Glasser & Glasser filed a declaratory

judgment proceeding against Wainger, asking the trial court to

determine that Wainger was not entitled to the Manville Trust

fees or to any other fees not fully earned prior to his

withdrawal from the firm.    Glasser & Glasser also sought a

judgment against Wainger in the amount of $188,580.10, claiming

that Wainger had been paid in excess of his agreed annual maximum

draw.
        The trial court consolidated the two actions, and, because

no material facts were genuinely in dispute, each party moved for

partial summary judgment.    The trial court entered summary

judgment in favor of Glasser & Glasser, holding that Wainger was

not entitled to share in the Manville Trust fees because the fees

had not been "fully earned" at the time of his withdrawal.

Additionally, the trial court ruled, in the alternative, that

Wainger was barred from collecting any such fees, even if fully

earned, by the provision in the partnership agreement that

limited his share of the firm's profits.     Wainger appeals.

        The relevant facts are undisputed.   In May 1987, Wainger was

employed by Glasser & Glasser as an associate attorney, and, on

January 1, 1990, he became a partner in the firm, subject to the

written partnership agreement.

        Wainger voluntarily withdrew from the firm, effective

January 21, 1992.    Pursuant to Article IX of the partnership

agreement, a withdrawing partner was to be paid for his interest




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in the partnership on the following basis:
          Item A. Any unpaid monthly draw, and additional
     compensation (as described in Paragraph 3 of Section B,
     Article IV).
          Item B. His Capital Account.
          Item C. His Undivided Profits Account, plus his
     share, if any, of any undivided profits of the firm
     with respect to uncollected fees which were fully
     earned by the firm prior to the . . . effective date of
     his . . . withdrawal . . . , but which fees are
     received by the firm subsequent to such date.

(Emphasis in original.)


     Since 1976, Glasser & Glasser has represented clients with

claims against various asbestos manufacturers, including The

Manville Corporation.   All these clients employed Glasser &

Glasser on a contingent fee basis, evidenced by written

agreements.   Generally, these agreements provided that Glasser &

Glasser would receive a fee of one-third of the gross amount

recovered for the client.   The agreements further provided the

following:
          It is understood and agreed that this employment
     is upon a contingent fee basis, and, if no recovery is
     made, [the client] will not be indebted to [Glasser &
     Glasser] for any sums whatsoever as attorney fees,
     although [the client] will be indebted to [Glasser &
     Glasser] for all unpaid costs incurred.


     In 1982, The Manville Corporation filed a voluntary petition

for reorganization pursuant to the United States Bankruptcy Code.

This filing led, in 1988, to the creation of the Manville Trust,

which was funded to pay all uncompensated asbestos claimants on

behalf of The Manville Corporation.

     In the summer of 1990, while Wainger was a partner in the



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firm, Glasser & Glasser obtained in favor of its asbestos clients

final, nonappealable consent judgments against the Manville

Trust.   The Manville Trust, however, did not agree to pay the

judgments; to the contrary, it was understood that the Manville

Trust would resist payment of any judgment or any attempt by the

judgment creditors to execute on the Manville Trust's assets.

Consequently, protracted litigation and negotiations ensued in an

effort to collect on the consent judgments, and Glasser & Glasser

did not recover for its asbestos clients any money from the

Manville Trust until January 1994, approximately two years after

Wainger's withdrawal from the firm. 2

     Wainger contends that the Manville Trust fees were fully

earned when the firm obtained the final, nonappealable consent

judgments.   Wainger, relying upon DR 2-105(C) of the Virginia

Code of Professional Responsibility, 3 asserts that the claims
     2
      In July 1990, Glasser & Glasser was enjoined by a federal
district court in New York from executing on the consent
judgments. Then, in November 1990, the Manville Trust filed a
class action, together with a proposed settlement, in federal
district court in New York, seeking to restructure its assets and
claim resolution procedures, and, in the summer of 1991, the
proposed settlement was approved. In December 1992, however, the
federal appellate court held that the settlement must be set
aside, and the federal district court again restrained execution
on the judgments.
     In June 1993, Glasser & Glasser, counsel for the Manville
Trust, and others negotiated a lump sum payment of the consent
judgments, discounted for present value. In July 1993, the
federal district court ordered payment by the Manville Trust of
the discounted judgments, and, on January 11, 1994, the federal
appellate court upheld the order to pay such sums. Later in
January 1994, the Manville Trust paid the discounted judgments.
     3
      Disciplinary Rule 2-105(C) provides, in pertinent part, as
follows:



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upon which the contingent fees were based were liquidated by

entry of the consent judgments and, therefore, that there accrued

to Glasser & Glasser, at that time, the right to its full

contingent fee.

     Glasser & Glasser contends, on the other hand, that a

contingent fee is not "fully earned" until the firm has effected

a recovery, i.e., payment in the event of settlement, trial, or

appeal.   We agree with Glasser & Glasser.
     We reject Wainger's contention that DR 2-105(C) determines

when a contingent fee is "fully earned."     The purpose of the Rule

is to ensure that a contingent fee agreement states clearly how

the amount of the attorney's fee is to be calculated.    The Rule

does not deal with the conditions precedent to which an attorney

and a client may agree regarding when a fee is earned.

     We also reject Wainger's contention that the Manville Trust

fees accrued upon the entry of the consent judgments.

Traditionally, in personal injury cases, a client employs an

attorney on a contingent fee basis.    Under such an arrangement, a

percentage of the amount of money actually recovered is paid to

the attorney as compensation for services rendered.    If nothing

(..continued)

     A contingent fee agreement shall state the method by
     which the fee is to be determined, including the
     percentage or percentages that shall accrue to the
     lawyer in the event of settlement, trial, or appeal,
     expenses to be deducted from the recovery, and whether
     expenses are to be deducted before or after the
     contingent fee is calculated.



                               - 5 -
is recovered, however, the attorney receives no fee.   This is

precisely the arrangement to which Glasser & Glasser and its

asbestos clients agreed in the present case.   As previously

noted, the employment contracts provided that, "if no recovery is

made, [the client] will not be indebted to [Glasser & Glasser]

for any sums whatsoever as attorney fees."   Thus, the fee is

contingent upon a recovery of money, and is not, as Wainger

contends, contingent merely upon a settlement or judgment.
     In the present case, Glasser & Glasser had not recovered any

money for its asbestos clients from the Manville Trust prior to

Wainger's withdrawal from the firm.    The record shows that

Glasser & Glasser expended considerable time and effort during

the two years subsequent to Wainger's withdrawal before effecting

a recovery.   Consequently, we conclude that the trial court

properly ruled that the Manville Trust fees and the bonus had not

been "fully earned" prior to the time of Wainger's withdrawal. 4

     Accordingly, we will affirm the trial court's judgment.
                                                          Affirmed.




     4
      Given our decision that the Manville Trust fees were not
"fully earned," we need not consider the provision in the
partnership agreement that limited Wainger's share of the firm's
profits.



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