Housni v GarciaAnnotate this Case
Decided on October 1, 2010
Supreme Court, Queens County
Abdellatie Housni, Plaintiff,
Martin Garcia, Defendant.
For the Plaintiff: John J. Ciafone, Esq., 25-59 Steinway St., Astoria, NY 11103
For the Defendant: Mendolia & Stenz, by Debra Malone, Esq., 875 Merrick Ave., Woodbury, NY 11590
Charles J. Markey, J.
This motion presents the interesting issue of what liabilities and liens may attach to the parties when a defendant and its insurer have settled a case directly with a plaintiff where a substitution of counsel was not filed with a court, and plaintiff's counsel has not been paid his share of the settlement proceeds.
Defendant has moved for summary judgment dismissing the complaint on the basis of the affirmative defense of release.
Upon the foregoing papers, this action to recover damages for personal injuries arose out of a motor vehicle accident that occurred on October 17, 2006. In support of his motion for summary judgment, defendant has submitted a copy of a release dated September 4, 2007, whereby, in consideration of the sum of $9,000.00, plaintiff released defendant from all actions, causes of action, suits and claims, in particular for injuries sustained on October 17, 2006. An answer asserting the defense of release was served on September 19, 2008. Defendant has not provided any proof of payment of the consideration to plaintiff. No stipulation discontinuing this action has been filed, and, apparently, none has been executed.
This motion for summary judgment was served on the attorney of record for plaintiff, John J. Ciafone, Esq., ("Ciafone") who commenced this action on behalf of plaintiff on May 24, 2007. Ciafone submitted a cursory affirmation in opposition in which he asserts that plaintiff substituted another attorney as counsel in place of Ciafone's office. Ciafone further indicates that [*2]defendant's insurer, Geico Insurance Company ("GEICO"), advised him that the substituted attorney had withdrawn from the case and that plaintiff had settled directly with Geico. The affirmation does not contain any substantive opposition to the motion. Ciafone merely states that he has been unable to locate plaintiff, asserts a right to a lien for his services, and contends that defendant should be liable for the lien.
In a circumspect reply affirmation, defendant's counsel does not disclose any information as to the circumstances surrounding the procurement of the release, but merely notes the lack of any proof contesting that plaintiff executed the document and states that the firm represents only the named defendant, Martin Garcia, not the nonparty GEICO.
A preliminary procedural matter will be addressed first. Despite Ciafone's assertion that another attorney was substituted for his office as plaintiff's counsel, a review of the Court's record demonstrates that a consent to change attorney was not filed with the Clerk of the Court as required to effectuate a substitution. (CPLR 321[b]). As such, absent a court order removing him, John J. Ciafone remains plaintiff's attorney of record (see, Matter of Myles B., 20 AD3d 413 [2nd Dept. 2005]; Hawkins v Lenox Hill Hosp., 138 AD2d 572 [2nd Dept. 1988]).
The paucity of information provided in the papers before the Court leaves many unanswered questions. It appears, however, that plaintiff, acting on his own, settled his case with defendant, whether directly or through defendant's counsel or insurer. A client may settle or compromise a suit or action without his attorney's knowledge or consent, but may not, by doing so, deprive the attorney of compensation. (See, 7 NY Jur 2d, Attorneys at Law §§ 149 & 274). Although the date of plaintiff's alleged discharge of his attorney is not in the record, it is undisputed that Ciafone prepared and filed the summons and complaint commencing this action prior to the settlement. As a consequence, the attorney's statutory charging lien provided for in Judiciary Law section 475 attached to the proceeds of the settlement (see, Schneider, Kleinick, Weitz, Damashek & Shoot v City of New York, 302 AD2d 183, 187-190 [1st Dept. 2002]; Matter of Koenig v Aetna Cas. & Sur. Co., 7 AD2d 903 [1st Dept. 1959]; see, e.g., Watson v Nosal Realty, LLC, 2002 WL 1592603, 2002 NY Slip Op 50268[U], 2002 NY Slip Op 50268[U] [Sup Ct Kings County 2002]).
A defendant and its insurer who settle a cause of action with a plaintiff without the knowledge of the plaintiff's attorney, while on notice of the attorney's charging lien, may not disregard the lien and pay the entire fund to the plaintiff. (Sargent v McLeod, 209 NY 360, 365 ; Schneider, 302 AD2d at 188). A defendant and its insurer are bound to retain sufficient funds to pay the amount to which the attorney is entitled. The law, in fact, conclusively assumes that the defendant has done so. (Id.; see also, Matter of Koenig, 7 AD2d at 903; Watson, 2002 NY Slip Op 50268[U], slip op. at 4). A defendant who fails to protect plaintiff's attorney's lien is liable for the reasonable value of the attorney's service to his client (see, Fischer-Hansen v The Brooklyn Heights R.R. Co., 173 NY 492, 502 ; Schneider, 302 AD2d at 190; Sehlmeyer v Universal Oven Co., 118 AD2d 692, 694 [2nd Dept. 1986]; Watson, 2002 NY Slip Op 50268[U], slip op. at 5). [*3]
Thus, whether defendant Garcia, or his representative, paid the entire settlement amount to plaintiff, or still possesses the settlement proceeds, Ciafone may assert his charging lien against defendant Garcia (Chesley v. Union Carbide Corp., 927 F.2d 60, 67-68 [2nd Cir. 1991]; Carribean Trading and Fidelity Corp. v. Nigerian Nat. Petroleum Co., 1993 WL 541236 [SDNY 1993]; Fischer-Hansen v The Brooklyn Heights R.R. Co., 173 NY 492, 502 ; Schneider, 302 AD2d at 190; Sehlmeyer v Universal Oven Co., 118 AD2d 692, 694 [2nd Dept. 1986]; Watson, 2002 NY Slip Op 50268[U], slip op. at 5; Ozorowski v. Pawloski, 207 Misc. 407 [County Ct. Montgomery County 1955]; see also, Haser v Haser, 271 AD2d 253 [1st Dept. 2000]). Inasmuch as this action has not been discontinued, Ciafone may seek enforcement of his lien in this proceeding (see, Haser, 271 AD2d at 254; Miller v Kassatly, 216 AD2d 260, 261 [1st Dept. 1995]; see, e.g., Watson, 2002 NY Slip Op 50268[U]).
Accordingly, this matter is set down for a hearing to ascertain and fix Ciafone's charging lien. The hearing shall be held on Monday, November 1, 2010, at 10:30 A.M., in Part 32, Room 140, of the Long Island City courthouse located at 25-10 Court Square, Long Island City, New York 11101. Plaintiff's attorney shall give notice of the hearing date to plaintiff and all parties, by overnight delivery, on or before October 18, 2010, and present proof of the overnight delivery to the undersigned on the hearing date.
Since defendant has not made a prima facie showing of payment of the settlement amount which was the consideration for the release, summary judgment based upon the release is not warranted and the motion is denied (CPLR 3212[b]). Moreover, under the circumstances of this case, any further applications should be served on plaintiff at his last known address as well as on his attorney of record.
Dated: October 1, 2010