Court Opinion

ID: 8263762
Source: CourtListenerOpinion
Date Created: 2022-10-16 15:58:17.353113+00
Date Added: 2024-06-11T16:43:16.115108
License: Public Domain

GOODE, J.
(after stating the facts). — The learned circuit judge found against the plaintiff’s case on the ground, that, so far as appeared, Mrs. Hagan was solvent and could compensate him for whatever services he had rendered.. The statute we have quoted makes no exception to the right of an attorney to enjoy and enforce a lien in a case like this, on the ground of the solvency of his client. The action instituted by Yonge in Mrs. Hagan’s name and pursuant to his contract with her, was one ex delicto for damages for the death of her husband. The statute says that in such an action, as well as one ex contractu, it is lawful for an attorney, either before the action is brought, or afterwards, to contract with his client for a certain portion of any settlement of the client’s cause of action, as compensation for the services the attorney may render. It says further that the contract may be for a portion of the proceeds of a settlement made either before the institution of an action or at any time after it is instituted. Yonge’s contract with Mrs. Hagan was taken before the institution of her action and was - within the words of the statute. It is further provided that if notice is served on the defendant or defendants in the. action by an attorney stating that he has such an agreement with his client, and stating his interest in the claim'or cause of action, the agreement shall operate as a lien, from_the date of service of notice, on the claim or cause of action and on the proceeds of any settlement thereof, for such attorney’s portion or percentage, and that this shall be so against an actual de*244fendant or a proposed defendant. It is further provided that any settlement between the adversary parties, whether the settlement is made before the action is brought or before or after a judgment, shall not affect the attorney’s lien. Further, that a defendant or proposed defendant, who in any manner shall settle any claim or cause of action with a client after service of notice by an attorney of a contract entitling him (th'e attorney) to a lien, shall be liable to the attorney for his lien on the proceeds of the settlement according to the contract between the attorney and the client, if the settlement is made without the written consent of the attorney. Those provisions are qiiite comprehensive. They indicate a purpose on the part of the Legislature to prevent a defendant, actual or potential, in an action sounding either in contract or tort, from settling with the claimant so as to cut out the claimant’s attorney from a contingent compensation to which the attorney is entitled under a contract. We see no reason why Yonge was not within the protection of this statute. He had a contract with Mrs. Hagan which stated definitely what percentage of any sum collected under it, with or without suit, should be his. The defendants had notice of that contract and settled with Mrs. Hagan in disregard of it. According to the plain language of the statute, they could only make a settlement with her which would be binding on Yonge and exonerate them from liability to him, by first obtaining his written consent. The statute says, in effect, that if a settlement was made without his written consent, as it was, the companies are liable to Mm for his portion of the proceeds.
Two or three propositions are advanced on this appeal by way of defense to the action. The first one is that the attorney’s lien provided for by the statute, does not attach to the claim or subject-matter in dispute until there is a verdict or judgment in favor of the attorney’s client. That argument might be good if this *245action were founded on the first section of the statute, but it is not. It is founded on the second section, wherein the attorney’s lien and his right to its enforcement, is made to depend on a contract with his client and timely notice of the contract to his client’s adversaries. The two sections of the statute are different in their scope and intention. This suit was well brought on the second section, as the facts fit that one and bring plaintiff’s cause of action within its remedial efficacy. To say that Yonge had no lien which fastened on the claim Mrs. Hagan had employed him to prosecute, until there was “a verdict, report, decision or judgment” in her favor, would be to abrogate the second section of the statute and wipe out all those terms in it providing that an attorney’s lien shall be good on the proceeds of any settlement made, not only before judgment, but before suit is brought. If the lien is not good until there is a judgment, what becomes of the clause which declares it good and binding from the. date of notice to the defendant on any proceeds thereafter realized by settling the claim? The lien to be enforced in this case is no general retaining lien of an attorney or special common law lien on a judgment recovered for a client. It is a statutory lien of new creation and derives its features from the language of the creating statute.
The second proposition which the defendants invoke is that Yonge should have sought to proceed with the case of Mrs. Hagan against the Transit and United Eailways Companies notwithstanding the settlement; should have interposed against the dismissal of that suit and carried it forward to a judgment for the amount of his demand. The statute in hand says in plain words that a defendant who settles with an attorney under the circumstances given, shall be liable to the attorney for that percentage of the proceeds which his contract with his client entitled him to receive. An express statutory liability of a legal char*246acter was thereby created, and as no particular or exclusive remedy was provided for its enforcement, it is enforceable by the usual common law remedy; that is, by an action at law corresponding to trespass on the case. [Sedgwick, Stat. & Const. Law (2 Ed.), p. 74 et seq. and the cases cited in the footnotes.] The construction contended for by the defendants is clearly inadmissible in view of the provision that if a settlement occurs before an action is begun on the claim, the defendant is nevertheless liable. Of course, in such an instance, the attorney can not go on with tbe prosecution of a suit in the name of bis client, because there will be no suit pending for him to carry forward- In tbat contingency, unquestionably, an independent action can be instituted in bis own name; and we discern nothing in the language of the statute which discriminates tbat contingency from one like tbe present, for the purpose of compelling the adoption of different procedures in tbe two cases. So far'as tbe enforcement of this lien is concerned, it strikes ns as resembling tbe statutory lien on crops, which a landlord may make effective by suing one who purchases tbe crops on demised premises from tbe tenant with knowledge of tbe landlord’s lien. [R. S. 1899, sec. 4123.]
We are cited to decisions from outside jurisdictions; Georgia, Wisconsin and New York. Tbe statutes construed in those cases are unlike ours and tbe decisions are not in point as to tbe remedy to be pursued in enforcing our statute; though tbe tone of opinion running through most of them is favorable to tbe plaintiff’s right under bis contract. [Frigg v. Chambers, 56 Ga. 274; Coleman v. Ryan, 58 Id. 182; Rodgers v. Furse, 83 Id. 115; Swift v. Register, 97 Id. 446; O’Brien v. Railway, 50 N. Y. Supp. 150; Herman v. Railway, 121 Fed. 185; Smelker v. Railway, 106 Wis. 135.] Tbe Wisconsin statute gives a lien on tbe cause of action and provides tbat the settlement of tbe action after notice of tbe lien, shall not be valid as against *247the lien. This was construed by the Supreme Court of Wisconsin to prevent a settlement of an action and to permit the attorney for the plaintiff to continue the • same cause of action despite the settlement. That statute contained no expressions making the settling defendant distinctly liable to the attorney. The Georgia statute gives an attorney a lien on suits, judgments and decrees of money, and says no person shall satisfy a suit until the lien of the plaintiff’s attorney for fees is satisfied. [Georgia Code, sec. 1989.] That language obviously makes the security of an attorney’s lien dependent on the judgment and attaches it to the judgment. The New York statute gives an attorney a lien only from the commencement of an action, and his lien is upon the cause of action, attaching to a verdict, report, decision or final order in his client’s favor. That statute is substantially like the first section of ours, but lacks the provisions of the second section. It was held in O’Brien v. Eailroad, supra, in construing the New York statute, that a defendant might plead a release by the plaintiff, but the release would not affect the attorney’s rights, and he could continue the prosecution of the action in his own name if he wished. Whether he could bring an independent action was not decided, but the New York Code seems to give that right. [Tracy’s Code of Civil Procedure, see. 66.]’ The plain language of our statute making a party who settles a claim against him in contravention of the right of an attorney to a percentage of the proceeds of the claim, liable to the attorney, whether the settlement occurs before or after suit, leaves no question in our minds that the liability is one which the attorney may enforce by an action. The statute says “shall be liable to such attorney.” As said above, when a distinct liability is created in favor of a party by a statute, such party has a remedy by action in his own name to enforce the liability if there is no special remedy provided by the statute.
*248. It is contended that the plaintiff was' bound to prove in this case that Mrs. Hagan’s canse of action in the case against the Transit Company and the United Railways Company was meritorious and entitled her to a verdict; that unless this could be and was shown, he had no right to recover, as his lien depended on the validity of her case. Looking again to the text of our statute, we find language which is incompatible with this interpretation. The attorney’s lien attaches to a “claim or cause of action,” not to the latter alone; and remains good against a defendant who settles a “claim, cause of action, or action at law, ’ ’ either before or after litigation, without the attorney’s written consent. In Wisconsin the statute, as we have pointed out above, attaches the attorney’s lien to and makes it depend on the existence of his client’s cause of action. It is, therefore, held that an adjustment of the. cause of action, by accord and satisfaction, operates in extinguishment of the lien, which can not thereafter be the foundation of a separate suit by the attorney. To prevent the lien from being defeated in this manner, attorneys are allowed to proceed with their client’s case, despite the adjustment; which, as to them, is a nullity. In Smelker v. Railroad, supra, it was said the statute, by a specific provision, preserved the lien in favor of an attorney in the action he had commenced; and for that reason he might prosecute such action to a final judgment for his fees, despite a settlement. Our statute contemplates a different procedure, or, at least, an additional one; for it says that if a settlement occurs without an attorney’s consent, when, by virtue of a contract he has a lien on the matter in dispute, the settling defendant shall be liable to him. This appears to allow the right of settlement, so far as the pending claim or action goes, with or without the attorney’s consent; but if it is exercised without his consent, a liability to him for his percentage of the proceeds arises and may be enforced against the defendant.
*249We think the solvency of Mrs. Hagan and her willingness to pay Yonge, of which latter fact there was no proof, is no defense to this action.
Plaintiff may have been guilty of unprofessional conduct in drumming up business and accepting employment in a cause from a concern like Neustadt’s. Behavior of that character has been frowned on always by the legal profession; hut, in the present instance, it does not enter as a factor into the determination of the plaintiff’s right, as nothing was proven against him of a champertous nature.
The judgment is reversed and the cause remanded.
All concur.