Doroshow, Pasquale, Krawitz & Bhaya v. Nanticoke Memorial Hospital, Inc.
2012 Del. LEXIS 32
| Del. | 2012Background
- Nanticoke Memorial Hospital filed a $160,958 hospital lien for Acosta's medical treatment costs from a July 11, 2003 car accident.
- Doroshow, Pasquale, Krawitz & Bhaya represented Acosta on a contingent-fee basis (40% of recovery plus costs).
- Nationwide Assurance paid $19,671.49 to settle Acosta's claim; payments were to Doroshow and Acosta.
- Doroshow deducted $8,052.02 in attorney's fees and costs from the settlement and placed the balance in an IOLTA account.
- Doroshow filed an interpleader (March 26, 2009) to release $11,619.47; Superior Court ordered that the full recovery go to Nanticoke for the lien, prompting Doroshow's appeal.
- The Delaware Supreme Court reversed the Superior Court, recognizing an attorney’s charging lien and that the charging lien must be satisfied before the hospital lien attaches.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether there exists an attorney’s charging lien at common law. | Doroshow argues charging lien exists and applies. | Nanticoke contends the hospital lien attaches first or independently of the attorney's lien. | Yes; charging lien exists at common law. |
| How to interpret ‘full and true consideration’ under 25 Del. C. § 4301. | True consideration is the recovery after paying the attorney’s lien. | True consideration means the full amount recovered, prior to deductions. | True consideration is the recovery after the attorney’s charging lien is satisfied. |
| Priority between the attorney’s charging lien and the hospital lien. | Charging lien should attach before hospital lien. | Hospital lien priority should follow competing liens rules. | Charging lien has priority over hospital lien; not governed by first-in-time rule. |
| Whether the term ‘legal representative’ includes the attorney. | Legal representative could include the attorney who obtains the recovery. | Legal representative does not include the client’s attorney. | ‘Legal representative’ excludes the attorney; hospital lien attaches to Acosta’s remaining funds after the attorney’s lien. |
Key Cases Cited
- Royal Ins. Co. v. Simon, 174 A.3d 444 (Del. Ch. 1934) (establishes the common-law basis for an attorney’s charging lien over others’ claims)
- Polin v. Delmarva Poultry Corp., 188 A.2d 364 (Del. Super. Ct. 1963) (confirms common-law charging lien and its enforcement by courts of equity/ordinary courts)
- Di Loreto v. Tiber Holding Corp., 804 A.2d 1055 (Del. 2001) (court discussed charging liens and priority; later Di Loreto (Del. S. Ct. 2001))
- Keeler v. Harford Mut. Ins. Co., 672 A.2d 1012 (Del. 1996) (statutory interpretation aid in determining ‘full and true’)
- Rapposelli v. State Farm Mut. Auto. Ins. Co., 988 A.2d 425 (Del. 2010) (acknowledges statutory context in lien questions)