Wade v. Clemmons

• Decision Date: 03 December 1975
• Citation: 377 N.Y.S.2d 415,84 Misc.2d 822
• Parties: Grace Gale WADE and William Wade v. Bernice CLEMMONS.
• Court: New York Supreme Court

Page 415

377 N.Y.S.2d 415

84 Misc.2d 822

Grace Gale WADE and William Wade v. Bernice CLEMMONS.

Supreme Court, Special Term, Kings County, Part I.

Dec. 3, 1975.

Samuel Weinberg, Brooklyn, for plaintiffs.

W. Bernard Richland, Corp. Counsel, New York City, for N.Y.C. Health & Hospital Corp.

MEMORANDUM

LOUIS B. HELLER, Justice.

A motion is made by the plaintiffs' attorney for an order fixing his fee and fixing the lien of the New York City Health and Hospital Corporation on the proceeds of a settlement of an automobile personal injury action on the grounds that the granting of such relief is 'in the interest of justice'.

This is an automobile personal injury action. The accident occurred on November 24, 1968. Plaintiffs' attorney was retained on May 3, 1972. A prior attorney waived his fee and turned over his file to the present attorney.

In the accident, plaintiff Grace Gale Wade sustained a severe fracture of the right leg, which required four extensive admissions at Kings County Hospital. The total hospital bill was $21,074.94. Part of the bill was paid on behalf of this plaintiff by Associated Hospital Services. There was a balance in the sum of $14,822.64 which was not covered by insurance. This bill is unpaid.

The defendant's insurance carrier offered its full insurance coverage of $10,000.00 in settlement. The plaintiff's attorney states that after investigating that the defendant had no other assets, he advised the plaintiff that It was in her best interests to accept the settlement.

With this assurance from her attorney, the plaintiff accept the settlement, signed a general release, and endorsed the settlement check. As it turns out, without the intervention of the court, the entire $10,000.00 settlement would go to the plaintiff's attorney and the New York City Health and Hospital Corporation. Thus, there is payable to the attorney under the 'sliding scale' retainer agreement, the sum of $3,743.44 plus $18.75 in disbursements for a total sum of $3,762.19. Since the hospital lien amounts to $14,822.64, the $6,237.81 balance of the settlement would go to the New York City Health and Hospital Corporation. On the other hand, the plaintiff who sustained serious and disabling injuries which will probably affect her for the rest of her life, would receive nothing. To prevent such an inequitable division of the settlement proceeds, the court called an informal conference. It was attended by the plaintiff, her attorney, and an attorney for the New York City Health and Hospital Corporation. In the course of the conference, a figure of $3,000.00 was discussed as a fair share of the settlement for the plaintiff. The court was informed by the plaintiff that she would accept the sum of $3,000.00 as her just share. The attorney for the 'Hospital' offered in behalf of the 'Hospital' to reduce its share of the settlement proceeds by $1,500.00 provided the plaintiff's attorney reduced his fee by a similar $1,500.00 amount. This offer was confirmed by letter from the Law Department of the City of New York, dated October 12, 1975. By effecting this arrangement, the hospital's share of the settlement proceeds would be reduced from $6,237.81 to $4,737.81. The attorney's share would be reduced from $3,743.44 to $2,262.19 including his disbursements in the sum of $18.75.

The plaintiff's attorney refuses to consent to this division of the settlement proceeds. He will not consent to a reduction of his fee. He argues that the court can direct payment of the sum of $2,433.23 to the plaintiff without reducing his fee by reducing the hospital's share by such sum. The sum of $2,433.23, he states is an attorney's fee based on the Judicial Conference sliding scale that should be charged the hospital for collecting the $6,237.81 lien. As authority, he cites the case of Matter of Koutrakos v. Long Island College Hospital, 78 Misc.2d 39, 355 N.Y.S.2d 718. In the Koutrakos case, the trial court assessed a portion of the attorney's fee against the Workmen's Compensation Lien of an insurance carrier. The argument of the plaintiff's attorney is wholly without merit. The insurance carrier in the Koutrakos case, Supra, appealed the order of the trial court. On appeal, the Appellate Division, Second Department unanimously modified the order of the trial court and required full reimbursement to the insurance carrier of its Workmen's Compensation lien with no reduction by charging an attorney's fee against it. (Koutrakos v. Long Island College Hospital, 47 A.D.2d 500, 368 N.Y.S.2d 528.)

Moreover, the validity of the hospital lien under section 189 of the Lien Law has not been challenged nor is the value of any of the charges in issue. Thus, the court does not have discretionary power to impose a reduction of the hospital lien. (Lien Law, § 189; Livingston v. Zimmerman, 5 A.D.2d 812, 170 N.Y.S.2d 103; Irizarry v. Pinto, 284 App.Div. 944, 134 N.Y.S.2d 778.)

In a letter addressed to the court, plaintiff's attorney states:

'While it is unfortunate that Mrs. Wade receives nothing except what the Court may allow her by way of reduction of the hospital lien, a lawyer is not expected to be a...