Case Title: Northern Pueblos Enterprises v. Montgomery

Citation: 644 P.2d 1036

Docket Number: 

State: new-mexico

Court: New Mexico Supreme Court

Date: 1982-05-07T00:00:00Z

Document:
644 P.2d 1036 (1982) NORTHERN PUEBLOS ENTERPRISES, Plaintiffs, J.H. Burttram, Interested Party-Appellant, v. Martin L. MONTGOMERY, Defendant. and NORTHERN PUEBLOS ENTERPRISES, Plaintiff, J.H. Burttram, Interested Party-Appellant, v. PUEBLO ELECTRIC & REFRIGERATION, Defendant-Appellee. No. 13944. Supreme Court of New Mexico. May 7, 1982. *1037 Joseph A. Roberts, Santa Fe, for interested party-appellant. Herrera, Sena & Vigil, R. Steve Herrera, Santa Fe, for defendant-appellee. PAYNE, Justice. This case requires us to decide whether a court may enforce a charging lien filed by an attorney for legal services rendered by awarding an amount smaller than that provided for by the contract with the client. Appellant Burttram represented Northern Pueblos Enterprises, Inc. (Northern Pueblos) in separate actions against Montgomery, a former employee of Northern Pueblos, and against Pueblo Electric and Refrigeration (Pueblo Electric). In the action against Montgomery, the parties entered into a stipulated judgment for $15,000. Burttram filed an attorney's lien for $19,856.87 for services performed. At the inception of the second action against Pueblo Electric, Burttram withdrew his representation of Northern Pueblos. Pueblo Electric filed a counterclaim against Northern Pueblos, on which it obtained a default judgment for $4,984.93 plus $1,000 attorney's fees ($5,984.93). Northern Pueblos is now insolvent and all of its assets are in the control of the Bureau of Indian Affairs. Montgomery deposited $16,427.01 ($15,000 plus interest) in the registry of the district court and his motion for satisfaction of judgment was granted. Burttram sought disbursement of these funds to satisfy his attorney's lien. Pueblo Electric moved to satisfy its judgment lien from these same funds. Burttram opposed the motion on grounds that his charging lien had priority. Pueblo Electric then sought an evidentiary hearing on the reasonableness of the amount of the attorney's lien. The court considered documentary evidence, including an affidavit by the former general manager of Northern Pueblos to the effect that the amount of Burttram's fees was reasonable under the contract, and the briefs of counsel. Subsequently the court wrote a letter to the parties indicating that Pueblo Electric should be paid out of the funds deposited by Montgomery the $5,984.93 plus costs of $67.36. The court then stated: Two days after this letter was written, the court issued an order granting Burttram's motion for enforcement of his lien and ordering the clerk to disburse $10,000 *1038 to Burttram simultaneously with the disbursement to Pueblo Electric. Burttram appeals, claiming the court had no authority to reduce the amount of his lien. Burttram's lien is an attorney's "charging lien," which is defined as an attorney's right Prichard v. Fulmer, 22 N.M. 134, 140, 159 P. 39, 41 (1916). Such a lien is not created by statute but has its origin in the common law, and is governed by equitable principles. Id. at 139, 159 P. at 40. The resolution of the issue presented here becomes clear when the historical basis for the "charging lien" is considered. Id. at 145, 159 P. at 42-43. Because a court exercises its equitable powers in enforcing an attorney's charging lien, it may inquire into the reasonableness of the asserted fee for purposes of enforcing the lien. This result is not contrary to our case law. In Re Will of Carson, 87 N.M. 43, 529 P.2d 269 (1974), involved construction of a contingent fee contract. The Court held that since courts may not alter or amend a contract, the terms of the contract must be enforced. The holding in Citizens Bank v. C & H Const., Etc., 93 N.M. 422, 600 P.2d 1212 (Ct.App.) cert. denied sub nom. Davis v. Citizens Bank, 93 N.M. 683, 604 P.2d 821 (1979), is to the same effect. In the present case, the court below did not alter Burttram's contract with Northern Pueblos. Northern Pueblos was not seeking to have the contract modified in this proceeding. The court simply gave Burttram equitable relief for a reasonable fee, leaving Burttram free to go against Northern Pueblos for the remaining fees due under the contract. As set forth above, the trial court concluded that for purposes of setting priorities of liens, Burttram was reasonably entitled to an attorney's fee of $10,000. This conclusion was made in the context of a proceeding to enforce a charging lien, and its applicability is limited to that context. It does not adjudicate the reasonableness of the fee as between Burttram and his client beyond the limits of the charging lien. We find no abuse in this exercise of its equitable powers. The assertion made that the attorney for Montgomery and Pueblo Electric had a conflict of interest which required dismissal of the latter's writ of garnishment is without merit. Accordingly, the judgment below is affirmed. IT IS SO ORDERED. EASLEY, C.J., and RIORDAN, J., concur.