Gelfand, Greer, Popko & Miller v. Shivener

• Decision Date: 31 January 1973
• Citation: 30 Cal.App.3d 364,105 Cal.Rptr. 445
• Court: California Court of Appeals
• Parties: GELFAND, GREER, POPKO & MILLER, Plaintiff, v. Doris E. SHIVENER, Defendant and Appellant, Gerald R. Schmelzer, Defendant and Respondent. Civ. 11358.

Page 445

105 Cal.Rptr. 445

30 Cal.App.3d 364

GELFAND, GREER, POPKO & MILLER, Plaintiff, v.Doris E. SHIVENER, Defendant and AppellantGerald R. Schmelzer, Defendant and Respondent.

Civ. 11358.

Court of Appeal, Fourth District, Division 1, California.

Jan. 31, 1973.

[30 Cal.App.3d 367] Patricia H. Mason, San Diego, for defendant and appellant.

Gerald R. Schmelzer, in pro. per., and Douglas R. Reynolds, San Diego, for defendant and respondent.

No appearance for plaintiff.

OPINION

WHELAN, Associate Justice.

Doris E. Shivener(Mrs. Shivener) has appealed from a summary judgment in an interpleader action which awarded to Gerald R. Schmelzer one-half of a fund upon the holder of which she had served a writ of execution.

Prior to August 27, 1971, an action for wrongful death of Jeffrey Ellsworth Shivener was settled for $100,000, to be apportioned among his heirs who were his widow Jo Anne, his mother Mrs. Shivener, and his fatherCarlos Shivener(Shivener).

The widow and Mrs. Shivener had been plaintiffs in the action; Shivener, having refused to join as a plaintiff, was made a defendant.

The amount of the settlement was paid to a firm of attorneys, Gelfand, Greer, Popko & Miller (the Popko firm), which represented the widow, which continued to hold it pending a court apportionment among the heirs.

Shivener, in Oklahoma, on August 27, 1971, retained by written agreement two attorneys, Allan H. Stocker, an Oklahoma lawyer, and Gerald H. Schmelzer of San Diego, to represent him in connection with the wrongful death action, which was described by name.The agreement stated in part:

'As compensation for your services you will receive 50% Of all sums awarded me as an heir of my deceased son, Jeffery Ellsworth Shivener, after first deducting any out-of-pocket expenses including my air-transportation to and from San Diego should I appear at the hearing.

'You agree to inform me of any offers of settlement and I agree not to make any settlement directly with the other parties or the insurance company without advising you.'

A hearing for apportionment of the settlement amount was held November 9, 1971, attended by the heirs including Shivener with Schmelzer, and at which testimony was taken.As a result the court determined the widow should receive 60% And Shivener and Mrs. Shivener 20% Each of the settlement amount, as embodied in a formal order made November 15.

The mother and father had been divorced in 1958 and since 1960 Shivener had become delinquent in support payments in an amount which by December 8, 1971, including interest, totalled $26,300.Mrs. Shivener obtained a judgment for that amount upon which execution issued on December 8, which was served by a notice of garnishment upon the Popko firm on December 9.

Also on December 9 Schmelzer delivered to the Popko firm a copy of the retainer and contingent fee agreement with Shivener dated August 27, 1971 and a letter directing the Popko firm not to release on Mrs. Shivener's claim more than one-half of the $20,000.

Other counter-demands were served upon the Popko firm which on December 17 filed the present action interpleading Shivener, Mrs. Shivener and Schmelzer.

In that action Schmelzer noticed a motion for summary judgment supported by his declaration and that of Stocker.They show the making of the retainer and contingent fee contract and its date; that prior thereto Stocker, on behalf of Shivener, had sought to retain other counsel in San Diego County without success because it was thought by Ralph W. Graves, the attorney consulted, the chances Shivener would get anything were negligible, after Stocker had received requests from Maurice V. Boudreau, the wife's attorney in the wrongful death action, for written appearance by Shivener and waiver of his rights therein, Mrs. Shivener's attorney stating Shivener's claim had very little value; that attempted negotiation by Stocker with Boudreau proved ineffective; thereafter Stocker made contact with Schmelzer, whose name he found in a legal directory, and who agreed to take the matter on a contingent fee basis after being informed of the opinions of Graves and Boudreau.

Stocker's affidavit also stated:

'Based upon my experience, it is my opinion that the contingent fee agreement entered into was reasonable because of the nature of the controversy.Carlos E. Shivener is completely satisfied with the fee arrangement.50% Contingent fee contracts are common in Oklahoma where the prospects for recovery are uncertain.'

Schmelzer's declaration stated he could testify the contingent fee contract was entered into because of the extreme difficulty of the litigation and the high risks involved therein; that Mrs. Shivener's attorney in the divorce action, Patricia Mason, had been extremely upset with the fee agreement, but that Shivener had been and continued to be totally satisfied with it; that before the writ of execution was served or the judgment obtained upon which the writ issued he had given written notice to Patricia Mason of his claim and had given her a copy of the contingent fee contract.

In opposition to the motion for summary judgment there were filed declarations by Patricia Mason and Boudreau.

Boudreau's declaration showed Shivener's attorney did not participate in the wrongful death action prior to settlement; Boudreau learned on August 17 from Schmelzer that the latter would represent Shivener in the apportionment hearing; that hearing took two hours.

Patricia Mason's declaration showed that on November 16, before she obtained the judgment against Shivener, she told Schmelzer she felt the fee was unconscionable both as to his client and the client's legitimate creditors; that the copy of the agreement then given her bore no date.

The motion for summary judgment was granted; the judgment, after allowing attorney's fees and costs to the interpleading plaintiff, awarded the remainder equally between Schmelzer and Mrs. Shivener.

The questions presented here are these:

Is the appeal moot?

Was there an issue of fact for determination by the trial court which made a summary judgment improper?

Necessarily included in the previous question are these:

Does the contingent fee agreement as a matter of law give Schmelzer an ownership interest in the fund, or an equitable lien thereon to secure his fees?

If so, is that interest or lien superiro to that of the execution creditor?

A joint answer of Schmelzer and Shivener in the interpleader action alleged Schmelzer and Shivener each was an owner of one-half of the $20,000 apportioned to Shivener pursuant to the August 27 contract; that Mrs. Shivener had no interest or claim on the funds owned by Schmelzer, and that she and her attorney had been put on notice of Schmelzer's ownership prior to the levy of execution.

The affidavits in support of the motion for summary judgment did not allege any assignment, the existence of a lien, or the intention of the parties to create a lien or to give security.

The memorandum of points and authorities did mention the theory of lien and the authorities in support of such theory.

Thus we are confronted squarely with the question whether an attorney's contingent fee contract containing no words as to a lien, security or assignment does as a matter of law and without more create a lien to secure his fees on the judgment or property obtained as a result of his services.

We are not prepared to go so far.As we discuss later, a lien may be created without the use of the word 'lien.'It does not follow that in every case a lien is created as a matter of law.

Our research persuades us that in the absence of express language declaring a lien, the giving of security or of assignment, the question whether the contract creates a lien is one of fact involving a determination of the intention of the parties.

The appeal is not moot.Schmelzer contends Mrs. Shivener's failure to post bond as, he argues, Code of Civil Procedure section 946 requires in this case, caused the attachment levied by Mrs. Shivener to be dissolved and the fund to be paid out.As he maintains the fund was the object of the suit, it no longer exists and the matter is moot.

Code of Civil Procedure section 946 was repealed in 1968 and replaced by sections 916,919,921and922.Section 921 provides in part:

'An appeal by a party who has levied an attachment shall not continue in force the attachment, unless an undertaking be executed and filed on the part of the appellant that the appellant will pay all costs and damages which the respondent may sustain by reason of the attachment . . .'

It should be obvious that neither former section 946 nor present section 921 of the Code of Civil Procedure would have had any application in this case.Those sections were intended to apply in the case of an appeal from a judgment in the action in which an attachment has been levied.Mrs. Shivener however did not have a writ of attachment levied, but a writ of execution, and this is not an appeal from the judgment in the divorce case of Shivener v. Shivener.The agreement was executed in the state of Oklahoma.We are satisfied the question of existence of a lien is to be determined by the law of California, the site of the fund.(Mitsui & Co. v. El Dorado Oil Works, 38 F.Supp. 752(N.D.California).)

There was an existing fund to which the father was a claimant, so that there might have been an assignment of the father's rights.The agreement in question does not purport to be and is not an assignment.No ownership interest in the fund was created thereby.(Isrin v. Superior Court, 63 Cal.2d 153, 158, 45 Cal.Rptr. 320, 403 P.2d 728;see alsoHendricks v. Superior Court, 197 Cal.App.2d 586, 589, 17 Cal.Rptr. 364.)

However, it is clear from the language of the agreement that Schmelzer's services in seeking to establish Shivener's rights in the fund were to be compensated out of any sums to which it might be established Shivener had a right and to the...