438 So. 2d 294 | Ala. | 1983
This is an appeal from the trial court decree which enforced an attorneys' lien on behalf of the attorney of record and another attorney employed by the client corporation against proceeds from the shareholders' unilateral transfer and sale of a corporate asset.
In 1977 Boykin Timber Farm Resources, Inc. (Boykin Timber), an Alabama real estate development corporation comprised of two shareholders, Richard A. Boykin, Sr. and Richard A. Boykin, Jr. (the Boykins), entered into an agreement with their accountant, Robert W. Turnbow. In the agreement Turnbow received all of the outstanding common shares of Boykin and Lagman, Inc. (Lagman), an Alabama corporation whose sole asset was the Florida condominium development known as Seaspray. In exchange for the stock, Turnbow promised to pay all of the indebtedness of Lagman and pledged the Lagman stock as security for his performance. Lagman also *295 granted Boykin Timber a security interest in certain second mortgages on Seaspray condominium units. When, after several years, the Lagman indebtedness totalled hundreds of thousands of dollars, Boykin Timber, in a 1981 proceeding, successfully recovered the Lagman stock and prevented Turnbow and Lagman from disposing of any Lagman assets pending transfer of the stock.
Attorney Joseph B. Nix, Jr. originally referred the Boykins to Mr. Robert G. Kendall, who became the attorney of record in the successful Boykin Timber litigation. The terms of the fee agreement were in dispute. The attorneys contend that the Boykins agreed to give them a 1/3 interest in the Seaspray condominium unit belonging to Lagman at the time of the stock foreclosure action, whereas the Boykins contend that they agreed to give only Kendall a 1/3 interest in the Lagman stock recovered from Turnbow. Following the recovery of the Lagman stock, the Boykins transferred the condominium unit in question to themselves and then resold the unit to a bona fide purchaser without the consent of either Nix or Kendall. Nix and Kendall then filed a motion to impress a lien pursuant to Code 1975, §
The trial court awarded Nix and Kendall $18,847.10, representing 1/3 of the sum received by the Boykins for the rental and sale of the condominium unit in question. To enforce the attorneys' lien in favor of both Nix and Kendall against the Boykins personally, the trial court made the following findings of fact: 1) the Boykins, as sole shareholders of Boykin Timber, were the corporation's alter ego and thus proper parties in the lien enforcement proceedings; 2) Nix, a practicing Alabama attorney, performed legal services in referring Boykin Timber to Kendall and was thus a proper party to enforce the attorneys' lien; 3) Boykin Timber's suit to recover the heavily indebted Lagman stock was in actuality a suit to recover the condominium unit in question, Lagman's sole asset; 4) Kendall and Nix agreed to receive 1/3 of the value of the condominium unit in question rather than 1/3 of the value of the heavily indebted Lagman stock as their fee; and 5) the Boykins' unilateral transfer of the condominium unit in question to themselves with actual notice of the attorneys' alleged outstanding interest constituted fraud on the court and the attorneys which was not vitiated by their subsequent sale of the unit to a bona fide purchaser. Boykin Timber and the Boykins then filed a joint notice of appeal.
The issues presented for review are 1) whether attorneys Nix and Kendall are proper parties to enforce an attorneys' lien pursuant to Code 1975, §
Only attorneys of record, the practicing attorneys who actually sign pleadings and actively participate in the crucial phases of their clients' litigation, are proper parties to enforce a lien under the authority of Code 1975, §
In the Boykin Timber litigation, Nix, whose only legal services consisted of his referring the Boykins to Kendall, could in no way be deemed an attorney of record. Kendall, therefore, as the only attorney of record, is the sole party capable of enforcing the statutory lien, and Nix's name should be stricken from the judgment below. Kendall will recover the full amount indicated by the employment agreement as interpreted by the trial court, 1/3 of the value of the condominium unit rentals and sale, subject to a duty to account to Nix pursuant to the employment contract, unless the trial court lacked the requisite subject matter jurisdiction.
The Boykins contend that the circuit court lacked subject matter jurisdiction to enter a personal judgment for monetary damages to enforce a §
Moreover, even if the condominium unit was deemed to be tantamount to the stock recovered in the original action, the trial court would be without power under §
Although Kendall argues that the proceeds from the sale of the condominium unit to the bona fide purchaser would be "property recovered" within the meaning of the statute, where the statute failed to include the word "proceeds" within its terms, we decline to expand its scope absent a clear legislative manifestation to the contrary. Grace v. Solomon,
Furthermore, just as the statute fails to allow liens upon "proceeds," it also fails to authorize the entry of personal judgments. If, therefore, an attorney wishes to seek a personal judgment against a former client, or the shareholders of a former corporate client, he must seek a legal remedy in the form of a new action based upon the employment contract orquantum meruit. Crittenden v. Parker,
Because the circuit court is without subject matter jurisdiction or power to enter a personal judgment for monetary damages in a §
REVERSED AND REMANDED.
TORBERT, C.J., and FAULKNER, EMBRY and ADAMS, JJ., concur. *297
