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Only as to a party against whom a judgment is entered by default is recovery limited to that prayed for in the demand for judgment. Where defendant has appeared and the parties are at issue, the final judgment shall grant the relief to which the party in whose favor it is rendered is entitled, even if not demanded.
Plaintiff, a firm of lawyers practicing in New York City, brought the present action in the court’s diversity jurisdiction to recover the fair and reasonable value of legal services rendered to defendant by Trafford, a senior partner in the plaintiff firm. Liability had been conceded, and the jury returned a verdict that was substantially higher than plaintiff’s bill to defendant. Defendant alleged that the $56,000 verdict was excessive. According to the defendant, it was improper for the jury to award an amount in excess of that claimed in the amended ad damnum clause, relying on New York law as controlling in the instant diversity case and citing for authority Michalowski v. Ey, 7 N.Y.2d 71, 75, 195 N.Y.S.2d 633, 163 N.E.2d 863. Defendant also contended that the trial court erred in admitting a portion of testimony, and excluding an exhibit.
Was it improper for the jury to award an amount in excess of that claimed in the amended ad damnum clause?
The court rejected defendant’s contention that the $ 56,000 verdict was excessive. According to the court, even if it was to accept New York law as overriding the federal rules, it would still find difficulty, in the light of code history explaining N.Y.C.P.A. § 479, which had been interpreted as applying the limitation 'where there was no answer.' The court held that only as to a party against whom a judgment was entered by default was recovery limited to that prayed for in the demand for judgment. Where defendant has appeared and the parties were at issue, the final judgment shall grant the relief to which the party in whose favor it was rendered was entitled, even if not demanded. The court also held that the testimony admitted concerned a contingent fee arrangement between defendant and one of plaintiff’s attorneys as defendant’s legal adviser. Admission of this evidence was proper, since it was relevant to the determination of the reasonable value of plaintiff’s services. The excluded exhibit was a study by defendant's expert purporting to set out maximum and minimum charges for the services performed, as outlined in his affidavit. Based as it was upon an affidavit given more than a year earlier in a voluntary attempt to induce settlement, the exhibit took no account of the affiant's more complete testimony at trial, and the judge properly excluded it on that ground.