Court Opinion

ID: 5166313
Source: CourtListenerOpinion
Date Created: 2022-01-02 03:38:17.296644+00
Date Added: 2024-06-11T08:25:51.986654
License: Public Domain

Judge NEY
dissenting.
I dissent because I believe that when, in one case, there are judgments in favor of each party and against the other, the trial court should generally enter a single judgment in the amount of the net difference between the two judgments.
The reason for this rule was articulated in Husband v. Colorado Mountain Cellars, Inc., 867 P.2d 57, 61 (Colo.App.1993) as follows:
[The] entering of two separate money judgments in a ease, such as this, in which one party is free to collect its full judgment, while the other party’s collection efforts may be handicapped or prevented by the insolvency or bankruptcy of the first party, would result in intrinsic inequity-
Relying on Dankwardt v. Kermode, 68 Colo. 225, 187 P. 519 (1920), the majority concludes that, notwithstanding the policy considerations discussed in Husband, an attorney lien on a judgment has priority over the judgment debtor’s right to obtain a setoff against that same judgment.
In explaining its holding, the Dankwardt court pointed to decisions of courts in other jurisdictions which recognized that an attorney lien cannot be defeated by a right of setoff of judgments thereafter received, growing out of prior independent transactions. The Dankwardt court further limited its ruling to the facts of that case.
Unlike Dankwardt, the judgments here for which setoff was requested were not judgments in separate, independent actions, but rather, judgments on the complaint and counterclaim in the same action. Had it not been for the somewhat fortuitous fact that the unlawful detainer claim was separately tried and reduced to judgment before the counterclaim, the court would have entered a single net judgment in the first instance, and Dean’s attorney lien on the judgment against Planned Management would not have attached.
In analyzing this situation, other courts have determined that the right to set off opposing judgments should prevail over an attorney lien when the judgments are entered in the same or a closely-related action. See John W. Muije, Ltd. v. North Las Vegas Cab Co., 106 Nev. 664, 799 P.2d 559 (1990); Galbreath v. Armstrong, 121 Mont. 387, 193 P.2d 630 (1948); Dalton State Bank v. Eckert, 135 Neb. 500, 282 N.W. 490 (1938); Wildung v. Security Mortgage Co. of America, 143 Minn. 251, 173 N.W. 429 (1919); Lindsay v. Pettigrew, 8 S.D. 244, 66 N.W. 321 (1896).
As the court recognized in Lindsay v. Pet-tigrew, supra, when each party has obtained a judgment in the same action, there are equities between the parties that the court is entitled to adjust without reference to the lien of the attorney of either party. The attorney must await determination of the net judgment and the adjustment of the equities which may result, as here, in the elimination of a judgment to which the attorney’s lien can attach.
This outcome is, in my view, consistent with the policy enunciated in Husband v. Colorado Mountain Cellars, Inc., supra, and a contrary result would be anomalous because Planned Management would have a potentially uncollectible judgment against the Stiners, yet would still be required to pay Dean the entire amount of the much smaller judgment entered in their favor.
Accordingly, I conclude that the attorney lien asserted by Dean did not preclude the trial court from entering a single net judgment in favor of Planned Management and that, under these circumstances, Planned Management’s right to setoff has priority over Dean’s attorney lien.
*190Therefore, I would reverse the trial court’s order and remand this cause with directions to enter a net judgment in favor of Planned Management.