Goodrich v. . McDonald, 112 N.Y. 157

Goodrich v. . McDonald

112 N.Y. 157 | NY | 1889

[EDITORS' NOTE: THIS PAGE CONTAINS HEADNOTES. HEADNOTES ARE NOT AN OFFICIAL PRODUCT OF THE COURT, THEREFORE THEY ARE NOT DISPLAYED.] *159 [EDITORS' NOTE: THIS PAGE CONTAINS HEADNOTES. HEADNOTES ARE NOT AN OFFICIAL PRODUCT OF THE COURT, THEREFORE THEY ARE NOT DISPLAYED.] *161 The judgment in the action brought by Mrs. Graves against Porter and others, was perfected on the 26th day of June, 1877, about two years before the amendment of section 66 of the Code of Civil Procedure enlarging the scope of that section, so that now an attorney who appears for a party has a lien upon his client's cause of action, which attaches "to a verdict, report, decision or judgment in his client's favor and the proceeds thereof, in whosoever hands they may come." The section as amended was prospective only in its operation and can have no effect upon a judgment previously recovered; and so it was held by the trial judge. Therefore, in the examination of the case, it is not necessary to take further notice of the section. Nor is it necessary to give any attention to the adjudication in the former action by the plaintiff against Mrs. Graves, as that action was commenced after the assignment of the bond and mortgage to Mrs. McDonald, and she was not a party thereto, and, therefore, not bound by the adjudication therein.

Attorneys have two kinds of liens peculiar to them in their relations with their clients. One is a lien which an attorney has upon all the papers of his client in his possession, by virtue of which he may retain all such papers until his claim for *163 services has been discharged. That in the books is called a retaining lien. An attorney also has a lien upon the fund, or judgment which he has recovered for his compensation as attorney in recovering the fund or judgment, and that is denominated a charging lien. (Stokes on Liens of Attorneys, 5, 85; In reWilson, 2 McCarthy Civ. Pro. 151.) It is the latter kind of lien with which we are concerned in this case.

The practice of enforcing such liens is not very ancient. Baron PARKE in Parker v. St. Quinton (12 Mees. Wels. 451), stated that the doctrine of an attorney's lien on a judgment was first established in the case of Welsh v. Hale (1 Doug. 238), where Lord MANSFIELD said; "An attorney has a lien on the money recovered by his client for his bill of costs. If the money come to his hands he may retain to the amount of his bill. He may stop it in transitu if he can lay hold of it. If he apply to the court they will prevent its being paid over till his demand is satisfied. I am inclined to go still further, and to hold that, if the attorney gave notice to the defendant not to pay till his bill should be discharged, a payment by the defendant after such notice would be in his own wrong, and like paying a debt which has been assigned after notice. But I think we cannot go beyond these limits." That great jurist in Wilkens v. Carmichael (1 Doug. 104), speaking of an attorney's lien also said: "It was established on general principles of justice, and that courts, both of law and equity, have now carried it so far that an attorney or solicter may obtain an order to stop his client from receiving money recovered in a suit in which he has been employed for him until his bill is paid."

The lien, as thus established, is not strictly like any other lien known to the law, because it may exist although the attorney has not and cannot, in any proper sense, have possession of the judgment recovered. It is a peculiar lien, to be enforced by peculiar methods. It was a device invented by the courts for the protection of attorneys against the knavery of their clients, by disabling clients from receiving the fruits of recoveries without paying for the valuable services by which the recoveries were obtained. The lien was never enforced *164 like other liens. If the fund recovered was in possession or under the control of the court, it would not allow the client to obtain it until he had paid his attorney, and in administering the fund it would see that the attorney was protected. If the thing recovered was in a judgment, and notice of the attorney's claim had been given, the court would not allow the judgment to be paid to the prejudice of the attorney. If paid after such notice in disregard of his rights, the court would, upon motion, set aside a discharge of the judgment and allow the attorney to enforce the judgment by its process so far as was needful for his protection. But after a very careful search we have been unable to find any case where an attorney has been permitted to enforce his lien upon a judgment for his services by an equitable action, or where he has been permitted to follow the proceeds of a judgment after payment of them to his client. His lien is upon the judgment, and the courts will enforce that through the control it has of the judgment and its own records, and by means of its own process which may be employed to enforce the judgment. But after the money recovered has been paid to his client he has no lien upon that, and much less a lien upon property purchased with that money and transferred to another. After such payment, unless he has protected his lien by notice to the judgment-debtor, his lien is forever gone, and he must look to his client alone for his compensation. As said by Lord ELLENBOROUGH, in Wilson v. Kymer (1 Maule Sel. 157), and repeated by Senator VER PLANCK, in McFarland v. Wheeler (26 Wend. 467), "in a case of a lien we should be anxious to tread cautiously and on sure grounds before we extend it beyond the limits of decided cases." There are not only no decided cases which sanction the maintenance of this action, but the drift of all the authorities is against the plaintiff's contention.

In Cooper v. Jenkins (33 Beavan, 431) the master of the rolls said: "I have always understood the law to be that a solictor had an inherent equity to have his costs paid out of any fund recovered by his exertions; and that the court would not part with it until these costs had been paid, except by *165 consent of the solictor." In Mercer v. Graves (7 Q.B., L.R. 499), Lord Chief Justice COCKBURN said: "Although we talk of an attorney having a lien upon a judgment, it is in fact only a claim or right to ask for the intervention of the court for his protection, when, having obtained judgment for his client, he finds there is a probability of the client depriving him of his costs." In Barker v. St. Quinton (supra), Baron PARKE said: "The lien which an attorney is said to have on a judgment (which is perhaps an incorrect expression), is merely a claim to the equitable interference of the court to have that judgment held as a security for his debt." In Barden v. Ward (42 N.J.L. 518), it was held that the right of lien for an attorney's costs exists only where he has received money upon the judgment in the cause, or has arrested it in transitu, or where the defendant has paid the judgment after receiving notice of the attorney's claim. REED, J., writing the opinion in that case said: "There is no instance in the practice of the English courts where the right of lien for costs has been enforced, except where the attorney has possession of the money received upon the judgment, or has arrested it in in transitu, or else the defendant has received notice of the claim of the plaintiff's attorney before settling the judgment." In Cowen v. Boone (48 Iowa 350), it was held that an attorney's lien upon a judgment is waived by his procuring a transfer to his client of land attached in the suit in satisfaction of the judgment. There the client having received the transfer of the land conveyed it to a third person and took back a mortgage for the purchase-money. She then assigned the mortgage and the attorneys, being defendants in a suit to foreclose it, asserted their lien; and it was held that their lien was upon the judgment and did not follow the land when the title was perfected in the client. In Whittle v. Newman (44 Ga. 377), it was held that after the litigation was ended and the client had possessed himself of the entire fund recovered by the litigation, the court had no power to give relief to the attorney. In Horton v. Champlain (12 R.I. 550), it was held that an attorney's lien originates in the control *166 which the attorney has in his retainer over the judgment, and the process for its enforcement, thus enabling him to collect the judgment and reimburse himself out of the proceeds. These authorities are all in harmony with the cases which have been decided in this state (St. John v. Diefendorf, 12 Wend. 261;Marshall v. Meech, 51 N.Y. 140; In the Matter of Knapp, 85 id. 284); and from them it appears to be clear that when by acquiescence of the attorney the money recovered has been paid to his client, or his client has received property in satisfaction of the judgment, he cannot enforce his lien against such money or property, but must look to his client alone for his compensation. Therefore, when this money, with the plaintiff's consent, was paid to Mrs. Graves, without any agreement that his lien should be transferred to the fund thus paid, or should follow it any further, the lien was lost, and his only remedy then was against her. Before the judgment was paid, the court, upon his application, would have protected his lien by compelling payment to him, or authorizing him to enforce the judgment for his own benefit, so far as it was necessary, to secure his compensation. If the defendants had paid the judgment without notice of the attorney's lien, they would have been protected and the attorney could not have enforced his lien upon the moneys paid. If, however, they had paid after receiving notice of the lien, or in fraud of the rights of the plaintiff, the court would have canceled any satisfaction of the judgment and allowed him to enforce it for his own benefit. Therefore, in no aspect of this case was the plaintiff in a position to enforce any lien upon this mortgage for the amount of compensation due for the legal services of his intestate.

But we need not stop here. If the plaintiff could otherwise have had an enforceable lien against the funds in Mrs. Graves' hands, or against the mortgage in the possession of Mrs. McDonald, the lien was lost by his consent that the money should be paid to Mrs. Graves. He not only consented that the money should be paid to her, but that he would look *167 to her alone for the amount coming to him. This certainly was a distinct and emphatic waiver of any lien he had. He did not reserve any lien upon the fund, or any right to proceed against it. We do not think that it is a reasonable construction of the letters written by him to Mr. Kernan and Mrs. Graves that he intended the fund should be paid to her subject to his lien, or that he intended in any way to preserve his lien. After payment with his consent, his lien was effectually destroyed as the lien of a mechanic is who delivers to the general owner an article upon which he has performed labor without any agreement that his lien shall be preserved.

The confidence of the plaintiff in the client appears to have been misplaced and abused. His claim is a very meritorious one, and we have been anxious to find some way to circumvent the efforts, apparently without justification, to defeat it. But we have been unable to find any, and reluctantly reach the conclusion that the judgment should be reversed and a new trial granted.

All concur.

Judgment reversed.