Tri-Ex Enterprises v. Morgan Guar. Trust Co., 80 Civ. 3856 (WCC).

• Decision Date: 30 April 1984
• Docket Number: No. 80 Civ. 3856 (WCC).,80 Civ. 3856 (WCC).
• Parties: TRI-EX ENTERPRISES, INC., Plaintiff, v. MORGAN GUARANTY TRUST COMPANY OF NEW YORK, Federal Republic of Nigeria and Central Bank of Nigeria, Defendants, v. Alan LONDON and Lime International Corporation, Third-Party Defendants.
• Court: U.S. District Court — Southern District of New York

583 F. Supp. 1116

TRI-EX ENTERPRISES, INC., Plaintiff, v. MORGAN GUARANTY TRUST COMPANY OF NEW YORK, Federal Republic of Nigeria and Central Bank of Nigeria, Defendants, v. Alan LONDON and Lime International Corporation, Third-Party Defendants.

No. 80 Civ. 3856 (WCC).

United States District Court, S.D. New York.

April 30, 1984.

Breed, Stairs & Berger, Attorneys for Plaintiff, New York City, for plaintiff; Andrew Berger, New York City, of counsel.

Lowe & Knapp, Lowe & Knapp, Esqs., New York City, for third-party defendants; Robert P. Knapp, Jr., New York City, of counsel.

Halley & Chalos, New York City, for defendants Republic of Nigeria and Central Bank of Nigeria; Michael G. Chalos, New York City, of counsel.

Burlingham, Underwood & Lord, New York City, for third-party defendant Alan London; Terry Stoltz, New York City, of counsel.

OPINION AND ORDER

CONNER, District Judge:

Plaintiff Tri-Ex Enterprises, Inc. ("Tri-Ex") has applied to the Court for an Order compelling production by Lowe & Knapp, Esqs. ("L & K") of certain documents within their possession (the "London Documents") belonging to third-party defendant Alan London ("London"). L & K, London's former counsel in this action, have asserted an attorney's lien on these documents in an attempt to secure payment of $30,580.45 in fees and disbursements allegedly owed by London to L & K. The Court has previously ordered that L & K permit attorneys for Tri-Ex and defendant Morgan Guaranty Trust Company of New York ("Morgan") to examine, but not copy, the London Documents. Tri-Ex makes the instant application following such a review. For the reasons stated below, the motion is granted.

The Court readily acknowledges the settled principle that an attorney may claim a lien for unpaid fees on a client's papers which came into the attorney's possession as a result of his professional representation of his client. See Pomerantz v. Schandler, 704 F.2d 681, 683 (2d Cir. 1983). The purpose of such a lien is to prevent the client from refusing to pay charges justly due. Id. Because the lien would lose its force if the client were permitted to use the papers held by the attorney, a court may require the attorney to release the papers to the client only if the parties settle their fee dispute or the client posts adequate security for payment.¹ See id. Indeed, failure to follow these limitations strictly is an abuse of discretion. Id.

The instant application is unusual in that the client's adversary, not the client, seeks documents subject to the attorney's lien. In this situation, the rationale underlying the general inviolability of an attorney's lien does not apply. As explained by the Second Circuit, "the right to retain the papers is valuable to the attorney in proportion as denial of access to them causes inconvenience to the client." Id., quoting In re San Juan Gold Inc., 96 F.2d 60, 60-61 (2d Cir.1938). Where the adversary has access to documents to which the client does not, the inconvenience to the client is increased, thereby enhancing the value of the lien.

Moreover, it would be inequitable to deny a litigant access to relevant, and perhaps essential, proof merely because his adversary has refused to pay his attorney's fees. Here, counsel for Tri-Ex and for Morgan have examined the documents held by L & K and determined that they are highly relevant to certain issues in this lawsuit and offer support for their respective claims. Although I do not suggest that London has refused to pay L & K intentionally to suppress the information...