Steiger v. Armellino

• Decision Date: 22 June 1998
• Citation: 315 N.J.Super. 176,716 A.2d 1216
• Parties: Jon STEIGER, Plaintiff, v. Regina ARMELLINO, Defendants. Monmouth County, General Equity Part
• Court: New Jersey Superior Court

Page 176

315 N.J.Super. 176

716 A.2d 1216

Jon STEIGER, Plaintiff, v. Regina ARMELLINO, Defendants.

Superior Court of New Jersey,

Chancery Division,

Monmouth County,

General Equity Part.

Decided June 22, 1998. ¹

Jon Steiger, Manasquan, plaintiff pro se.

Newman Scarola & Associates (James M. Newman, Freehold, Esquire, appearing), for defendant.

FISHER, P.J.Ch.

By way of this action, plaintiff Jon Steiger, an attorney-at-law, seeks a judgment declaring the viability of an attorneys' lien he previously asserted in connection with his representation of defendant Regina Armellino in a matrimonial action. ² On May 22, 1998 an order was entered requiring defendant to show cause why this court should not declare an attorney's lien to have attached to certain proceeds arising out of that matrimonial action and why funds currently being held in escrow, the movement of which was temporarily restrained on May 22, 1998, should not be permanently restrained pending a fee arbitration proceeding. Defendant has opposed that application.

Plaintiff's assertion of a lien is based upon N.J.S.A. 2A:13-5, which states:

After the filing of a complaint or third-party complaint or the service of a pleading containing a counterclaim or cross-claim, the attorney or counsellor at law, who shall appear in the cause for the party instituting the action or maintaining the third-party claim or counterclaim or cross-claim, shall have a lien for compensation, upon his client's action, cause of action, claim or counterclaim or cross-claim, which shall contain and attach to a verdict, report, decision, award, judgment or final order in his client's favor, and the proceeds thereof in whosesoever hands they may come. The lien shall not be affected by any settlement between the parties before or after judgment or final order, nor by the entry of satisfaction or cancellation of a judgment on the record. The court in which the action or other proceeding is pending, upon the petition of the attorney or counsellor at law, may determine and enforce the lien.

Certain essential facts are not disputed. Plaintiff's representation of defendant in the matrimonial action was terminated on June 4, 1997. Soon thereafter, defendant was presented with plaintiff's statement of services rendered and a notice of plaintiff's intention to commence legal action with regard to his claim for the payment of attorneys' fees, as required by R. 1:20A-6. In response, defendant demanded that the questions concerning plaintiff's claim for fees be arbitrated before the Fee Arbitration Committee. ³ After plaintiff's assertion of that claim and during the pendency of their fee dispute in the Ocean County Fee Arbitration Committee, the matrimonial action was settled and a judgment of divorce entered by the Honorable Anthony J. Mellaci, Jr., J.S.C., on May 14, 1998.

Plaintiff, it appears, came to learn of that settlement while in the Monmouth County Court House on another matter. Efforts were then undertaken by defendant to have funds received through the settlement of the matrimonial action paid out to her. Plaintiff filed this action and obtained a temporary restraining order prohibiting the transfer out of escrow to defendant of $15,000 of the settlement funds (which approximates the amount claimed by plaintiff to be due him as a result of his participation in the matrimonial action).

On the surface there appears little doubt as to plaintiff's right to relief. Defendant brought a claim for relief in the matrimonial action; plaintiff represented defendant in that action; and money is due defendant as a result of the judgment entered in that action. But defendant has raised an issue that renders the matter unlike the reported decisions involving N.J.S.A. 2A:13-5. See, n. 6, infra. That is, at the time plaintiff's representation of defendant in the matrimonial action was terminated, the only named parties to that action were defendant and her husband. After plaintiff's departure, an amended complaint was filed by defendant seeking relief from her ex-husband's parents. By way of that amended complaint, defendant alleged that her ex-husband forged or caused to be forged her name on a note and mortgage held by her ex-husband's parents on the marital home. Thus, defendant alleged in her amended complaint--filed by plaintiff's successor as defendant's counsel--that the court should declare the note and mortgage held by her husband's parents on her marital home to be null and void and that "the sum of $69,735.82 being held in escrow from the sale of the marital home be awarded to plaintiff as her share from equitable distribution of the marriage ". The settlement agreement reached in the matrimonial action called for the payment from the escrowed proceeds from the sale of the marital home (to which her ex-husband's parents had asserted an interest) to defendant of $37,500. It appears that other than defendant's entitlement to certain weekly child support and alimony payments from plaintiff not relevant to the present issue, that $37,500 constitutes the only funds which defendant has or will receive from the matrimonial action.

Plaintiff contends that this is a recovery from the matrimonial action to which his lien has attached; defendant asserts that these funds are only the product of her claim against her ex-husband's parents, unpleaded during plaintiff's stewardship in the matrimonial action. This court finds that the lien did attach to the aforementioned $37,500 not only because it is irrelevant that the claim against the ex-husband's parents was not filed and served until after plaintiff's services were terminated, but also because defendant's contentions misapprehend the true character of the settlement in the matrimonial action.

Defendant has, first, provided no support for her contention that an attorney's lien, asserted by way of N.J.S.A. 2A:13-5, attaches only to the particular pleading filed by that attorney. The statute itself makes no such distinction; rather, it states that after the filing of a pleading the attorney "who shall appear in the cause for the party" shall have a lien for compensation "upon his client's action, cause of action, claim or counterclaim or cross-claim." While the statute may be subject to more than one interpretation through its imprecise language, there is nothing about the wording of the statute which would necessarily suggest that the attorneys' lien attaches only to the client's recovery on the pleadings actually filed by the attorney-lienholder and no other subsequent amended pleading filed in the same action. To hold to the contrary would suggest a means through which connivance after an attorney's termination could negate an otherwise justified lien on a client's claim. ⁴ Legislation should be read so as to avoid an unreasonable or unanticipated result. See, e.g., Matter of J.W.D., 149 N.J. 108, 115-116, 693 A.2d 92 (1997). The Legislature clearly meant to provide a mechanism by which an attorney, after termination, would have the ability to be compensated, if necessary, by a lien on any recovery in the action. An unwarranted diminishment of that right would occur through the adoption of defendant's approach. This court declines to impress such limitations on a terminated attorney's rights to compensation in the absence of a clear direction from the Legislature or our appellate courts.

Even if such a limitation were appropriate, the circumstances of this case do not suggest its application. Defendant's contention arises from her claim that her recovery of $37,500 in the matrimonial action came from her ex-husband's parents and not her ex-husband. That is not however what appears in the settlement agreement, which states, in pertinent part:

The parties agree to the following in full and complete satisfaction of any and all claims which each may have against the other for equitable distribution pursuant to N.J.S.A. 2A:34-23;

1. MARITAL HOME--The parties were owners by joint tenancy by the entirety of the marital home .... The home was sold and the sum of $71,935.82 is being held in escrow.... This money was allegedly due and owing to the parents of ...