by Beth Gilmore Reineke
In a perfect world, we win every case, the client is always happy, and we always get paid for the work we have done. In reality, we don’t win every case, the client is not always happy, and we don’t always get paid for the work we have done, or at least not without some preplanning on our part. Sometimes it is necessary to withdraw from a case and to file a claim of lien in order to increase the chance of being paid. This article is designed as a primer on motions to withdraw and attorneys’ charging liens, retaining liens, and judgment liens. Hopefully, you live in a perfect world and you won’t need this information. If not, this article will give a good jumping-off point and some helpful practice tips.
Motions to Withdraw
All motions to withdraw must meet the procedural requirements of Fla. R. Jud. Admin. 2.060. According to subsection (j) of Rule 2.060, an attorney must file a motion setting out the reasons for withdrawing and the name and address of the client. The motion must be set for hearing, and the notice and the motion must be served on the client and opposing counsel.
Practice Tip: Add the client to the certificate of service and include a paragraph in your motion setting out each party’s name and address and stating specifically that you are serving the motion on your client and the opposing party in compliance with Fla. R. Jud. Admin. 2.060.
The acceptable reasons for withdrawal are found in Fla. R. Prof. Conduct 4-1.16. Rule 4-1.16(a) of the Rules Regulating The Florida Bar sets out several situations where withdrawal is mandatory. Withdrawal is mandatory when the client discharges you, when you are too sick to continue, or when continued representation will result in a violation of the Rules of Professional Conduct. Subsection (b) of Rule 4-1.16 is permissive and states that “a lawyer may withdraw from representing a client if withdrawal can be accomplished without material adverse effect on the interests of the client.” Subsection (b) also sets out six additional situations when a lawyer may withdraw from representation presumably even when his or her withdrawal may adversely affect the client’s interests.
Practice Tip: While it appears from a wording of Rule 4-1.16 that the motion to withdraw does not need to allege a basis for the withdrawal unless withdrawal will have material adverse effect on the client’s interests, Rule 2.060 requires the attorney to set out his or her reasons for withdrawal. Additionally, if the attorney is requesting a charging lien or may decide to do so at a later date, the better practice is to specifically state a reason for withdrawing which tracks the language of one of the subsections of Rule 4-1.16. This is particularly true if you are working under a contingency contract. In Faro v. Romani, 641 So. 2d 69, 71 (Fla. 1994), the Florida Supreme Court held that when an “attorney withdraws from representation upon his own volition, and the contingency has not occurred, the attorney forfeits all rights to compensation.” This rule is tempered by the court’s further holding that “if the client’s conduct makes the attorney’s continued performance of the contract either legally impossible or would cause the attorney to violate an ethical rule,” the withdrawing attorney may still be entitled to a fee. Id.
Practice Tip: If you have a contingency fee contract and you are withdrawing because the client has discharged you, you should consider stating this fact in your motion and as a finding of fact in the order of withdrawal. Under these circumstances, withdrawal is mandatory under Florida Bar Rule 4-1.16(a), “not of your own volition,” and you may still be entitled to a fee if the client ultimately recovers. The same suggestions would apply if you are withdrawing because of client conduct.
Motions for Substitution of Counsel
Substitution of counsel is controlled by Fla. R. Jud. Admin. 2.060(i), and requires court permission and the client’s consent. Typically, both attorneys and the client sign motions for substitution of counsel, and the court enters an order without hearing.
Practice Tip: Rule 2.060(i) permits the court to condition the substitution of counsel, and presumably the notice of appearance of new counsel after withdrawal, on the payment of or posting of security for the substituted attorney’s fee and expenses. You may want to include a paragraph in the withdrawal order requiring the client to notify you if he or she subsequently retains an attorney to file an appearance on the client’s behalf.
Retaining Liens, Charging Liens, and Judgment Liens
As most of us know, there is a difference between a retaining lien, a charging lien, and a judgment lien. A retaining lien is a lien for payment of services against client property in the attorney’s possession regardless of whether the property is related to the matter for which money is owed to the attorney.1 A retaining lien does not require judicial action to perfect or enforce it. It is established by possession of the items in question until paid in full. However, it will not attach to property entrusted to the attorney for a specific purpose.2
A charging lien is a lien against the fruits of the litigation in question. By definition it does not apply to property outside the subject matter of the litigation, and it will not apply in cases where there are no tangible fruits of the litigation.3 Further, while in some limited instances charging liens may attach to alimony payments,4 they will never attach to child support.5
In order to have a valid charging lien there must be an agreement, express or implied, that the fee is recoverable from the proceeds of the litigation; the client must dispute the amount due or refuse to pay the amount due; and the attorney must give the client adequate notice of the intent to seek a charging lien on the proceeds from the recovery.6
Practice Tip: Include a provision in the written fee agreement that specifically provides for a charging lien in the event of nonpayment. If the client’s homestead is part of the litigation subject matter and you want the charging lien to extend to the client’s homestead or to proceeds from the sale of the client’s homestead, include specific language in the retainer agreement sufficient to place the client on notice that you are entitled to a charging lien in the event of nonpayment and that theclient is waiving his or her homestead exemption.7
In In re: Washington, 238 B.R. 852 (M.D. Fla. 1999), the bankruptcy court upheld a charging lien against a client’s homestead based on the following contract language, and held that the lien could not be set aside as a judgment lien under Bankruptcy Code §522(f).
The undersigned attorney shall have a lien on all the client’s documents, property (both real and personal, regardless of homestead), or money in his or her possession or another’s for his/her benefit for the payment of all sums due under this agreement, and upon property or funds received by client by settlement, judgment, or otherwise, or which was an issue in litigation between the parties.
Practice Tip: Regardless of whether you are filing a motion to withdraw, if you have not been paid you should consider serving a notice of charging lien on the client and the opposing party when settlement is imminent or at the time the case is scheduled for trial. Charging liens should always be served in the most expeditious manner possible. A timely served charging lien is enforceable against the opposing party as well as your client. If an opposing party (or opposing counsel) who has notice of your charging lien sends your client a settlement check and the client fails to pay you, your lien may be enforceable against the opposing party as well as your client.8 However, time is of the essence. Once the court has lost jurisdiction over the parties or subject matter either because the case has concluded or the property has been disposed of or removed beyond the jurisdiction of the court, your lien, if not previously noticed, will be unenforceable.
In order to have a valid charging lien the attorney’s services must contribute to a positive judgment or settlement for the client.9 If the attorney is withdrawing upon his or her own volition prior to the conclusion of the case, in order to preserve your right to compensation and to a charging lien, the court must make a finding that withdrawal is essentially involuntary because the attorney has been discharged or the client’s conduct is making the attorney’s continued representation impossible or will cause the attorney to violate an ethical rule.10
Practice Tip: The court is much more likely to remember your contribution favorably at the time of your withdrawal. If you are filing a motion to withdraw and you have not been paid, include your notice of charging lien in the motion to withdraw along with a request that the court adjudicate the validity and amount of your charging lien. Serve an attorneys’ fee affidavit on the client along with a copy of the motion and notice of hearing, and have the court adjudicate the validity and amount of your lien at the time of your withdrawal.
The amount of the charging lien will depend on the nature of your retainer agreement. If your agreement provides for hourly billing at set rates, then in the absence of a determination that the fee is excessive, the attorney is entitled to compensation and a charging lien to secure compensation in accordance with his or her undisputed invoices.11
Special rules apply to charging liens based upon contingent fee contracts. In Searcy, Denney, et al. v. Poletz, 652 So. 2d 366 (Fla. 1995), the Florida Supreme Court held that the “lodestar” method of computing reasonable attorneys’ fees as adopted by the court in Rowe12 should not be applied in this context. Searcy, 652 So. 2d at 368. The court instead held that
Unlike an award of attorneys’ fees to a prevailing party, a quantum meruit award must take into account the actual value of the services to the client. Thus while the time reasonably devoted to the representation and a reasonable hourly rate are factors to be considered in determining a proper quantum meruit award, the court must consider all relevant factors surrounding the professional relationship to ensure that the award is fair to both the attorney and the client. See Reid, Johnson, Downes, Andrachik & Webster v. Lanserry, 68 Ohio St. 3d 570, 629 N.E.2d 431, 436–37 (1994) (totality of circumstances surrounding each situation should be considered in determining reasonable value of discharged contingent-fee attorney services in quantum meruit). Application of the factors set forth in Rule Regulating The Florida Bar 4-1.5(b) [footnote omitted] may provide a good starting point. However, because the factors relevant to the determination of the reasonable value of services rendered will vary from case to case, the court is not limited to consideration of the Rowe factors. The court must consider any other factors surrounding the professional relationship that would assist the court in fashioning an award that is fair to both the attorney and client. For example, the fee agreement itself, the reason the attorney was discharged, actions taken by the attorney or client before or after discharge, and the benefit actually conferred on the client may be relevant to that determination [footnote omitted]. The determination as to which factors are relevant in a given case, the weight to be given each factor and the ultimate determination as to the amount to be awarded are matters within the sound discretion of the trial court.
Id. at 369.
Practice Tip: Include a provision in the order on motion to withdraw and adjudicating charging lien requiring the ex-client and opposing party/counsel to notify you in the event of a settlement and/or the trial date and to send you a copy of the final judgment. Include a specific provision stating that the court will reserve jurisdiction in the final judgment to enforce your charging lien. In the event the final judgment does not include the required reservation of jurisdiction, you can then file a motion under Fla. R. Civ. P. 1.540 to correct the final judgment.
A judgment lien is broader than a charging lien in that it can include property outside the corpus of the litigation. It is perfected against real property by recording a certified copy of the judgment in the public record in the county where the real property is located.13 The clerk’s office automatically records all money judgments in the public record. This is not sufficient to create a lien against the client’s real property. The statute requires a certified copy of the judgment to be recorded, and the judgment must contain the name and address of the lienholder. A judgment lien against real property is good for seven years and may be extended for an additional 10 years by recording a new certified copy of the judgment and an affidavit setting out the lienholder’s current address prior to the expiration of the first lien.14
Practice Tip: If a charging lien is denied because it was not timely filed or there is nothing to which it may attach, an attorney still has the option of filing a separate breach of contract suit for fees and costs. However, if the charging lien is timely filed and its amount adjudicated in the underlying action, the court also has the jurisdiction to enter a judgment against the client for the amount of fees and costs due. Provided the client is given adequate notice of the attorney’s intent to adjudicate the fees and costs due, this procedure is preferred by the Florida Supreme Court over the filing of a separate lawsuit.15
Practice Tip: As with any other judgment, a judgment adjudicating the amount of attorneys’ fees and costs should meet the minimum requirements set out in F.S. §55.01 and Fla. R. Civ. P. Form 1.990, and should include the magic language “for which let execution issue”; otherwise, the clerk will refuse to issue any post-judgment writs (execution, garnishment, etc.)16
Practice Tip: If you intend to perfect a judgment lien against a client’s personal property, you should be aware that the statutory requirements in this area have changed significantly as of October 1, 2001.17 You should also review the exemptions from levy set out in F.S. Ch. 222 and Article 10, §4 of the Florida Constitution.
Under the new statutory sections, the Department of State will be maintaining a central database of all judgment liens against personal property.18 Judgment liens may be acquired on a judgment debtor’s interest in all personal property subject to execution in this state (see exemptions from levy set out in F.S. Ch. 222) other than fixtures, money, negotiable instruments, and mortgages.19
A judgment lien is acquired by recording a judgment lien certificate in accordance with §55.203 with the Department of State after the judgment has become final.20 The content requirements of the judgment lien certificate can be found in §55.203. A judgment lien so acquired will be effective as of the date of recording and will take priority as of its effective date, and will be good for an initial period of five years.21 At any time within six months before the scheduled lapse of the initial judgment lien, the judgment creditor may acquire a second, new judgment lien by recording a new judgment lien certificate meeting the requirements of §55.204. The second judgment lien is a new judgment lien and not a continuation of the original judgment lien, and it will permanently lapse and become invalid five years after its effective date.22
A valid judgment lien against personal property gives the judgment creditor the right to take possession of any personal property subject to levy by writ of execution, garnishment, or other judicial process.23 There have been no significant changes in the procedures and statutory provisions relating to writs.24 The local clerk’s office will issue the writ, ex parte, upon request, and the sheriff’s office in the county where the property is located will execute the writ.
Practice Tip. If you have never levied against personal property or have not levied in a while, call the local sheriff’s office before having your writ issued to discuss procedure, writ content, and the deposits required for levy, storage, and sale. q
1 Daniel Mones, P.A. v. Smith, 486 So. 2d 559 (Fla. 1986).
2 Attorney’s Retaining Lien: What Items of Client’s Property or Funds are not Subject to Lien, 70 A.L.R. 4th 827 (1989).
3 Braverman v. Oliveri, 564 So. 2d 190 (Fla. 1990) (criminal actions); Glickman v. Scherer, 566 So. 2d 574 (Fla. 4th D.C.A. 1990) (child custody cases).
4 Dyer v. Dyer, 438 So. 2d 954 (Fla. 4th D.C.A. 1983).
5 Brake v. Sanchez-Lopez, 452 So. 2d 1071 (Fla. 3d D.C.A. 1984).
6 Daniel Mones, P.A. v. Smith, 486 So. 2d 559 (Fla. 1986).
7 Bakst, Cloyd & Bakst, P.A. v. Cole, 750 So. 2d 676 (Fla. 4th D.C.A. 1999); In re: Washington, 238 B.R. 852 (M.D. Fla. 1999).
8 Gaebe, Murphy, et al. v. Bradt, 704 So. 2d 618 (Fla. 4th D.C.A. 1997).
9 Rochlin v. Cunningham, 739 So. 2d 1215 (Fla. 4th D.C.A. 1999); Litman v. Fine, Jacobson, et al., 517 So. 2d 88, 91–92 (Fla. 3d D.C.A. 1987), rev. denied, 525 So. 2d 879 (Fla. 1988).
10 Hernandez v. Alonso, 660 So. 2d 349 (Fla. 3d D.C.A. 1995); Faro v. Romani, 641 So. 2d 69, 71 (Fla. 1994); Calley v. Thomas M. Woodruff, P.A., 751 So. 2d 599 (Fla. 2d D.C.A. 1998), mandamus denied, Solomon v. Thomas M. Woodruff, P.A., 743 So. 2d 510 (Fla. 1999).
11 Franklin & Marbin, P.A. v. Mascola, 711 So. 2d 46 (Fla. 4th D.C.A. 1998).
12 Florida Patient’s Compensation Fund v. Rowe, 472 So. 2d 1145 (Fla. 1985), modified, Standard Guar. Ins. Co. v. Quanstrom, 555 So. 2d 828 (Fla. 1990).
13 Fla. Stat. §55.10.
14 Fla. Stat. §55.10(2).
15 Daniel Mones, P.A. v. Smith, 486 So. 2d 559 (Fla. 1986); Sinclair, Louis, et al. v. Baucom, 428 So. 2d 1383 (Fla. 1983); Shawzin v. Sasser, 658 So. 2d 1148 (Fla. 4th D.C.A. 1995).
16 DuBreuil v. Regnvall, App. 3 Dist., 527 So. 2d 249 (1988), review denied, 537 So. 2d 568. (Absence of words “for which let execution issue” in judgment effectively granted judgment debtor a stay of execution and denied judgment creditor the right to execute on judgment.)
17 See Fla. Stat. §§55.21—55.209 (2000).
18 Fla. Stat. §55.201.
19 Fla. Stat. §55.202(2).
20 Fla. Stat. §55.202(2)(a).
21 Fla. Stat. §§55.202(3) and 55.202.
22 Fla. Stat. §55.204.
23 Fla. Stat. §55.205.
24 See Fla. Stat. ch. 77, pertaining to garnishment, and ch. 56, pertaining to execution.
Beth Gilmore Reineke is the principal in the firm Reineke & Associates, P.A. She is a board-certified family law attorney and certified family mediator. Prior to concentrating in family law, Ms. Reineke’s practice included commercial collections and foreclosures.