Lazenby v. Codman

Decision Date18 July 1940
Docket NumberNo. 379.,379.
Citation116 F.2d 607
PartiesLAZENBY v. CODMAN et al.
CourtU.S. Court of Appeals — Second Circuit

Davies, Auerbach, Cornell & Hardy, of New York City (Martin A. Schenck and William J. Carr, both of New York City, of counsel), for appellant.

Wing, Lakin & Whedon, of New York City (Burt D. Whedon, of New York City, of counsel), for appellees.

Before SWAN, AUGUSTUS N. HAND, and PATTERSON, Circuit Judges.

SWAN, Circuit Judge.

This action was commenced on September 1, 1939, in the Supreme Court of New York County by service of a summons and complaint upon Leonard E. Bergman and Julius Klein, administrators of the estate of Abraham L. Erlanger, deceased. The complaint alleges that the plaintiff is a New York attorney; that at the request of the defendants Codman and Meyer, trustees of a trust established by the will of Maria P. Codman, admitted to probate in Massachusetts, he performed legal services resulting in the entry of a decree in the Surrogate's Court of New York County that the sum of $616,150.12 was owed by the estate of Erlanger to said testamentary trust; that his services were reasonably worth $96,224.20, of which sum a balance of $32,078.20 remains unpaid; that he has an attorney's lien on the debt established by the decree of the Surrogate's Court and the amount of this lien should be determined and "it should be enforced pursuant to section 475 of the New York Judiciary Law Consol. Laws, c. 30." It is also alleged that said testamentary trustees are non-residents and in their individual capacity have no property within the state of New York out of which the plaintiff's lien can be realized; and that he has no adequate remedy at law. The complaint concludes with a prayer that the amount of the plaintiff's lien be ascertained and the Erlanger administrators be directed to pay him, and for general equitable relief. Martha C. Karolik and Catherine A. Codman, who are non-residents and the beneficiaries of the testamentary trust, were also made defendants. Summons and complaint were served upon the four non-resident defendants outside the state. After removal of the action to the District Court, the non-resident defendants answered and filed a counterclaim, and then moved to dismiss the action as against them for lack of jurisdiction. This motion was granted.

The District Judge appears to have been of the opinion that the plaintiff's complaint relies solely upon the statutory lien created by section 475 of the New York Judiciary Law and that an attorney employed by testamentary trustees is not given such a lien upon a judgment rendered in favor of the trust estate. Section 475 provides that "From the commencement of an action * * * the attorney who appears for a party has a lien upon his client's cause of action * * * which attaches to a * * * judgment or final order in his client's favor * * *." In Matter of Meighan, 106 App.Div. 599, 94 N.Y.S. 1153, affirmed 182 N.Y. 558, 75 N.E. 1131, stockholders of a corporation brought a derivative action against a director to recover for the corporation dividends alleged to have been wrongfully paid out of capital. A settlement was effected by the parties and the plaintiffs' attorneys petitioned the court to establish their lien against the sum so paid. The trial court held that they had no statutory lien and this was affirmed without opinion by the appellate courts, although in each there was a dissent.1 From the dissenting memoranda it would appear that the majority went on the view that the cause of action was the corporation's, while the attorneys acted not for it but for the plaintiff stockholders. This decision was referred to in Schoenherr v. Van Meter, 215 N.Y. 548, 551, 109 N.E. 625 with the statement: "We assume, in accordance with our decision in Matter of Meighan, 106 App.Div. 599, 94 N.Y.S. 1153, and Id., 182 N.Y. 558, 75 N.E. 1131, that the statutory lien created by section 475 of the Judiciary Law * * * for the benefit of an attorney is not enforceable under such conditions."

On the strength of these cases the appellees argue that an attorney who brings an action for a person suing in a representative capacity has no statutory lien on the judgment or proceeds resulting from his services. The contention is that an attorney's contract with a trustee binds the trustee personally; the trustee as an individual is the attorney's client and as an individual he has no cause of action in litigation; hence no judgment is rendered "in his client's favor" to which the attorney's statutory lien can attach. But there is an obvious difference between a stockholder's derivative suit and a suit by a testamentary trustee. In the former, the defendant's liability is one which the corporation itself can enforce and only because of the corporation's failure to do so is a stockholder permitted to sue in its behalf. In...

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7 cases
  • In re Markos Gurnee Partnership
    • United States
    • U.S. Bankruptcy Court — Northern District of Illinois
    • April 27, 1995
    ...law, the estate created by a trust agreement or a will is not a legal person, and so has no capacity to sue or be sued. Lazenby v. Codman, 116 F.2d 607, 609 (2d Cir.1940) (A testamentary trust "is not a juristic person and the trustee is the only party entitled to bring suit."); Hanson v. B......
  • Larson v. United Healthcare Ins. Co.
    • United States
    • U.S. Court of Appeals — Seventh Circuit
    • July 26, 2013
    ...from the common law of trusts. At common law a trust cannot sue or be sued because it “is not a juristic person.” See Lazenby v. Codman, 116 F.2d 607, 609 (2d Cir.1940). ERISA departs from this rule by expressly providing in § 1132(d)(1) that “[a]n employee benefit plan may sue and be sued ......
  • Ingalls Iron Works Company v. Fehlhaber Corporation
    • United States
    • U.S. District Court — Southern District of New York
    • January 13, 1972
    ...Appeals for the Second Circuit has held that § 475 creates a lien for the attorney on the trustee's cause of action. Lazenby v. Codman, 116 F.2d 607, 609 (2d Cir. 1940). 9 "If there was any other remedy in the power of the trustee to pursue and protect the interest of those who were the ben......
  • Hoffpuir v. Hoxsey, 3269.
    • United States
    • U.S. District Court — Northern District of Texas
    • February 8, 1949
    ...poses that an attorney's retaining lien cannot be actively enforced, Rose v. Whiteman, 52 Misc. 210, 101 N.Y.S. 1024; Lazenby v. Codman, 2 Cir., 116 F.2d 607; and a charging lien, if nothing is recovered, or, if there is no cause of action, there is nothing to which the lien can attach. Kip......
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