Froelich v. Graham

80 S.W.3d 360, 349 Ark. 692, 2002 Ark. LEXIS 399
CourtSupreme Court of Arkansas
DecidedJuly 5, 2002
Docket01-1310
StatusPublished
Cited by5 cases

This text of 80 S.W.3d 360 (Froelich v. Graham) is published on Counsel Stack Legal Research, covering Supreme Court of Arkansas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Froelich v. Graham, 80 S.W.3d 360, 349 Ark. 692, 2002 Ark. LEXIS 399 (Ark. 2002).

Opinion

Ray Thornton, Justice.

This appeal stems from appellant Larry Froelich’s attempt to collect unpaid attorney’s fees through the imposition of an attorney’s lien on funds that his client, Nita Cox, gave to appellee, Billy Graham.

Nita and Walter Cox were divorced in 1984. The divorce decree required that Walter pay $2,000 per month in alimony until Nita’s death or remarriage. Walter stopped making payments after the December 1997 installment. Nita Cox engaged the services of appellant, the attorney who had handled the divorce of her boyfriend, Billy Dean Graham, and on March 2, 1998, Nita petitioned to have Walter found in contempt and the arrearage reduced to judgment. In his response, Walter admitted that he had stopped making the payments; however, he affirmatively asserted that for the past eighteen months, Nita and Mr. Graham had been holding themselves out as husband and wife and that they were, in fact, lawfully married.

The case was heard on three separate days. During the hearing, Nita and Mr. Graham testified. Between the second hearing day, November 6, 1998, and the third, December 4, 1998, Walter’s trial counsel became aware of a decision of the Arkansas Supreme Court, Herman v. Herman, 335 Ark. 36, 977 S.W.2d 209 (1998), which was handed down on November 4, 1998. He concluded that it made Walter’s defacto marriage defense untenable, and he announced to the court at the December 4 hearing that he would tender a check for $23,642.71 to Ms. Cox. The remaining issues were submitted to the chancellor.

Nita gave the check, which she received from Walter, to Mr. Graham. On December 8, 1998, Mr. Graham deposited this check into his bank account.

On January 14, 1999, appellant filed notice of an attorney’s lien, asserting that, according to his agreement with Ms. Cox, he had accrued fees and expenses and that, pursuant to Ark. Code Ann. § 16-22-304 (Repl. 1999), an attorney’s lien attached to the settlement check that Walter had paid to Nita.

In a letter opinion, filed on February 24, 1999, the chancellor found Walter in willful contempt and awarded Nita $2,200 in attorney’s fees.

On April 1, 1999, appellant petitioned to enforce the attorney’s hen against the alimony settlement. In a letter order, the chancellor found that the petition for contempt based on Walter’s unilateral termination of alimony constituted a cause of action that was separate and distinct from the causes of action concerning the issues of whether alimony should be continued or terminated and whether Walter had violated other orders of the court. The chancellor further found that $2,200, the amount that he had previously awarded for the contempt and that had already been paid to appellant, constituted a reasonable attorney’s fee for the “cause of action involving the contempt proceeding” as it related to Walter’s failure to pay spousal support. The chancellor concluded that the Arkansas Attorney’s Lien Law did not give appellant an attorney’s lien on the $23,642.71 check for back alimony.

This decision was appealed to our court of appeals. On appeal, appellant contended that the trial court erred in refusing to enforce his attorney’s lien because all of Ms. Cox’s claims were inextricably connected to the principal claim. On December 20, 2000, in an unpublished opinion, the court of appeals held that appellant had properly secured an attorney’s lien, and remanded the matter to the chancery court to determine the amount of attorney’s fees to which appellant was entitled.

On remand, the chancellor found that appellant was entitled to $8,486 in attorney’s fees. He further concluded that appellant could not look to the check Ms. Cox had tendered to Mr. Graham for payment of those fees. The chancellor found that appellant could not. make a claim to the $23,000 check that Ms. Cox gave to Mr. Graham because he did not have knowledge that appellant “was making any claim to the monies.”

It is from this order that appellant appeals. We reverse the chancellor and remand the matter to the court for further proceedings.

On appeal, appellant argues that the chancellor erred when he refused to impose an attorney’s lien on a settlement check that appellant’s client' gave to appellee. The chancellor, in denying appellant’s requested lien, found:

[T]he evidence presented at the hearing simply does not prove that Mr. Graham had knowledge that petitioner was making any claim to the monies (in the form of a $23,000 check) which was endorsed to Mr. Graham and became his property. Therefore, Mr. [Froelich] is not entitled to- a judgment against Mr. Graham.

An attorney’s lien is created by complying with Ark. Code Ann. § 16-22-304. The statute in relevant part provides:

(a) (1) From and after service upon the adverse party of a written notice signed by the client and by the attorney at law, solicitor, or counselor representing the client, which notice is to be served by certified mail, a return receipt being required to establish actual delivery of the notice, the attorney at law, solicitor, or counselor serving the notice upon the adversary party shall have a lien upon his client’s cause of action, claim, or counterclaim, which attaches to any settlement, verdict, report, decision, judgment, or final order in his client’s favor, and the proceeds thereof in whosoever’s hands they may come.
(2) The lien cannot be defeated and impaired by any subsequent negotiation or compromise by any parties litigant.
(3) However, the lien shall apply only to the cause or causes of action specifically enumerated in the notice.
(b) In the event that the notice is not served upon the adverse party by an attorney at law, solicitor, or counselor representing his client, the same lien created in this section shall attach in favor of the attorney at law, solicitor, or counselor from and after the commencement of an action or special proceeding or the service upon an answer containing a counterclaim, in favor of the attorney at law, solicitor, or counselor who appears for and signs a pleading for his client in the action, claim, or counterclaim in which the attorney at law, solicitor, or counselor has been employed to represent the client.
(d) The court or commission before which an action was instituted, or in which an action may be pending at the time of settlement, compromise, or verdict, or in any chancery court of proper venue, upon the petition of the client or attorney at law, shall determine and enforce the Hen created by this section.

Id. (Emphasis added.)

We have explained that an attorney’s lien is an interest in the judgment of which the attorney cannot be deprived. Camp v. Park, 226 Ark. 1026, 295 S.W.2d 613 (1956). We have further explained that an attorney’s lien is based on equitable principles establishing that an attorney’s hen is based on the natural equity that a plaintiff should not be allowed to appropriate the whole of a judgment in his favor without paying for the services of his attorney who assisted in obtaining such judgment. Id.

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Cite This Page — Counsel Stack

Bluebook (online)
80 S.W.3d 360, 349 Ark. 692, 2002 Ark. LEXIS 399, Counsel Stack Legal Research, https://law.counselstack.com/opinion/froelich-v-graham-ark-2002.