Case Name: WOLFE v. MACK
Court: New York Supreme Court, Appellate Term
Jurisdiction: New York
Decision Date: 1913-06-18
Citations: 142 N.Y.S. 433
Docket Number: 
Parties: WOLFE v. MACK.
Judges: 
Reporter: West's New York Supplement
Volume: 142
Pages: 433–440

Head Matter:
(81 Misc. Rep. 185.)
WOLFE v. MACK.
(Supreme Court, Appellate Term, First Department.-
June 18, 1913.)
1. Attorney and Client (§ 144 )—Contract for Fees—Construction—“Recovery.”
Where an attorney in a contract for fees specified for 20 per cent, of any recovery in the case, the word “recovery” should be construed in the sense of restoration or vindication of the client’s rights by a formal judgment or decree of a competent court at his instance and suit, or the obtaining by such judgment of some right- or property which had been taken or withheld from him; and hence the attorney would not be permitted to claim that the contract only provided for fees in case of settlement without suit.
[Ed. Note.—For other cases, see Attorney and Client, Cent. Dig. §§ 332, 333; Dec. Dig. § 144.
For other definitions, see Words and Phrases, vol. 7, pp. 6019, 6020.]
2. Attorney and Client (§ 117*)—Money Collected—Relation of Parties.
The relation between an attorney and his client with reference to money collected by the attorney is not that of debtor and creditor, but the fiduciary one of principal and agent, since the money belongs absolutely to the client, and he can compel the attorney to pay it over by summary proceedings.
[Ed. Note.—For other cases, see Attorney and Client, Cent. Dig. §§' 232, 234, 235; Dec. Dig. § 117.*]
3. Attorney and Client (§ 190*)—Attorney’s Lien—Adjustment—Summary
Proceedings—Payment of Money.
Where an attorney asserts a lien for fees in summary proceedings to compel him to pay over money collected for his client, the lien will be adjusted in that proceeding, and judgment rendered requiring him to pay over the balance.
[Ed. Note.—For other cases, see Attorney and Client, Cent. Dig. §§ 412-417; Dec. Dig. § 190.*]
4. Attorney and Client (§ 186*)—Contract for Services — Attorney’s
Lien.
Where an attorney pays over the balance over and above the amount which he claims for services, his lien on the amount so paid is terminated, and only attaches to the amount held by him, which is still subject to adjustment by the court, either in summary proceedings or in an action.
[Ed. Note.—For other cases, see Attorney and Client, Cent. Dig. § 393; Dec. Dig. § 186.*]
5. Accord and Satisfaction (§ 11*)—Attorney and Client.
Where an attorney, having made a settlement of a claim for his client, sent him a check for the proceeds, less 33% per cent, which he retained as fees, he could not, by notifying the client that he accepted and cashed the check in full settlement of his claim, establish an accord and satisfaction; such doctrine not applying to a payment by an attorney to his client.
[Ed. Note.—For other cases, see Accord and Satisfaction, Cent. Dig. §§ 75-82; Dec. Dig. § 11.*]
Guy, J., dissenting.
Appeal from Municipal Court, Borough of Manhattan,. Fifth District. ■
Action by Moses Wolfe against James F. Mack. Judgment for defendant, and.plaintiff appeals. Reversed, and new trial ordered.
Argued April term, 1913, before GUY, GERARD, and PAGE, JJ.
Williams & Thomas, of New York City, for appellant. •
James F.'Mack, of New York City, pro se.
For other cases see same topic & § number in Dec. & Am.-Digs. 1907 to date, & Rep’r Indexes
For other cases see same topic & § number in Dec. & Am. Digs. 1907 to date, & Rep’r .Indexes

Opinion:
PAGE, J.
This action is brought by a client against his attorney to recover a balance of money had and received. -The plaintiff had a claim against the Jewelers' Safety Fund Society under a policy of insurance that he had unsuccessfully attempted to adjust. He retained the defendant, an action was brought, and a recovery had in plaintiff's favor. A dispute then arose as to the amount.of defendant's compensation; the plaintiff claiming that defendant had agreed to accept 20 per cent, of the recovery for his services, and.the defendant claiming to be entitled to 33% per cent, thereof. The defendant sent plaintiff a check for $1,025.35, upon which was written, "Wolfe v. Jewelers' S. F. S., in full settlement." The letter accompanying the check stated:
"In accordance with our agreement of last evening, I inclose my certified check for $1,025.35 in full settlement. Kindly sign the inclosed receipt in full as agreed.''
The plaintiff retained the check, but immediately wrote to the defendant that he would not accept it in full settlement, and demanded the balance. Defendant thereupon wrote to the plaintiff:
"You cannot keep that check, in view of the statement that it was in full settlement in both letter and check, and claim a balance due you, because this is contrary to our agreement, contrary to the terms under which the check was sent, and will be in accord and satisfaction."
Some three weeks later a letter was written to defendant on behalf of plaintiff, stating that he still had the check, and declining to accept upon the terms stated in the letter. Defendant did not answer this letter, and refused to pay the balance on demand. The plaintiff deposited the check and brought this action. Judgment has been given in favor of the defendant.
At the.time plaintiff retained defendant he paid him $25 and received the following:
"June 24, 1911.
"Received of Mr. Wolfe $25 in the case of Wolfe v. Jewelers' Safety Fund Society; it being understood that I am to have, in addition to said $25, 20 per cent, of any recovery in said case. James F. Mack."
The defendant claims that it was the understanding of the parties that this 20 per cent, was to be for any adjustment of the claim or collection thereof without action. If this were the fact, he used very inept language to express the idea. The word "recovery," in law, means:
"The restoration or vindication of a right existing in a person, by the formal judgment or decree of a competent court, at his instance and suit, or the obtaining by such judgment of some right or property which has been taken and withheld from him." Black's Law Dictionary.
Therefore an attorney should not be allowed to urge that, when he used the words "recovery • in said case," he did not intend thereby that he should prosecute, or even bring, an action, but that he intended to only agree to collect by amicable negotiation, without suit. The attorney claims.that at about the time the complaint was verified he told the plaintiff that he should claim a reasonable fee, and again he testified that after he had collected the judgment he informed the client that he • demanded one-third of the' recovery as a fair and reasonable fee, and that after some discussion the plaintiff agreed to his making such deduction from the recovery. Both of these statements were flatly denied by the plaintiff; and-if the learned trial justice had resolved these contested questions of fact in defendant's favor, and given judgment on that ground, I would not be inclined to interfere with his decision. ' He has, however, expressly given judgment for the defendant upon the ground that: '.
"The acceptance' of the check, after notice to plaintiff by defendant in writing, operated as an accord and satisfaction."
With this conclusion I cannot agree. The relation between attorney and client, with regard to money collected, is not that of debt- or and creditor, but the fiduciary one of principal and agent. The money belongs absolutely to the client, and he can compel the attorney to pay it over by summary proceedings. If in such proceeding the attorney asserts a lien, .his lien will be adjusted, and he will be required to pay over the balance. But if he pays over the balance, over and above the amount which he claims for services, his lien on.the amount paid over is gone, and only attaches to the amount held by him, which . is still subject to adjustment by the court, either in a summary proceeding or in an action.
This identical question has been recently passed upon by the Appellate Division, Fourth Department, in General Fireproof Construction Co. v. Butterfield, 143 App. Div. 708, 128 N. Y. Supp. 407.
The court said:
"The money collected by the defendant belonged to the plaintiff. The defendant at most had a lien upon it for his services, and could retain what he was legally entitled to for such services. When the defendant sent the check for a part of the money, he limited his right to compensation to the amount retained by him, and conceded that the amount sent belonged to the plaintiff. Under these circumstances the plaintiff was not bound to return its own money to defendant, under penalty of acknowledging defend- • ant's right to the balance retained. Plaintiff had a right to retain the money paid to it, and to sue for and recover any portion of the balance to which it was entitled. It is not a case for the application of the rule of accord and satisfaction. It would not be quite fair for the defendant to say: T send you an amount which I concede is yours; but, if you take it, you must acknowledge you are not entitled to any part of the moneys I have retained.' Eames Vacuum Brake Co. v. Prosser, 157 N. Y. 289, 291 [51 N. E. 986]."
The case of Dunn v. Whalen, 120 App. Div. 729, 105 N. Y. Supp. 588, relied upon by the respondent, is not an authority in support of the case at bar. In that case the attorney accepted a check in full settlement of his bill for services rendered. The liability of the client to the attorney for services rendered is that of debtor and creditor, and, of course, if there is a dispute as to the value of the services, and the client sends a check for a less amount than the attorney claims in full settlement thereof, and he accepts and retains it, an accord and satisfaction arises.
The judgment should be reversed, and a new trial ordered, with costs to appellant to abide the event.
GERARD, J., concurs.