Sugarland Ind., Inc. v. Thomas
Supreme Court of Delaware
420 A.2d 142 (Del. 1980)
Sugarland Industries' (Sugarland) (defendant) board was selling a tract of land for $23.8 million when shareholders (plaintiffs), believing the price too low, hired an attorney whose efforts prompted a competing $27 million offer from another company, R-S-C. The board still preferred the original offer until the plaintiffs' derivative suit led the trial court to order competitive bidding, ultimately yielding a $37.2 million sale to Hines, plus a separate bidding process on another parcel where Hines outbid the next-highest bidder by $1.25 million. The trial court awarded the attorney a fee equal to 20 percent of the entire difference between the Hines sale price and the original offer, and Sugarland appealed.
Whether, for purposes of attorney compensation, 20 percent is an appropriate factor to apply to the monetary benefit a selling party receives from an attorney's representation, even where the attorney was not directly responsible for the increased sale price.