Lehecka v. Tier Technologies, Inc.

109 P.3d 1212, 279 Kan. 282, 2005 Kan. LEXIS 151
CourtSupreme Court of Kansas
DecidedApril 22, 2005
DocketNo. 90,307
StatusPublished
Cited by5 cases

This text of 109 P.3d 1212 (Lehecka v. Tier Technologies, Inc.) is published on Counsel Stack Legal Research, covering Supreme Court of Kansas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Lehecka v. Tier Technologies, Inc., 109 P.3d 1212, 279 Kan. 282, 2005 Kan. LEXIS 151 (kan 2005).

Opinion

The opinion of the court was delivered by

Beier, J.:

This appeal of a district court’s ruling regarding an attorney’s lien spotlights procedures followed by appellant Tier Technologies, Inc., d/b/a Kansas Payment Center.

Prior to the resolution of this divorce case between R. Wayne Brown and Katrina Brown, Katrina’s attorney twice filed an attorney’s lien against his client’s anticipated property settlement and support payments. The attorney, John W. Lehecka, served notice of both hens on Katrina and on Wayne’s attorney, T. Michael Wilson.

When the divorce was granted, the district judge directed that all payments from Wayne to Katrina be made through the Kansas Payment Center (the Center). In the journal entry, the Center was ordered to forward all payments to Katrina at “301 W. Central, #203, Wichita, KS 67202,” which was Lehecka’s office address.

Approximately a year and a half after the divorce was granted, Wayne sent two checks to satisfy his entire settlement and support obligation to the Center. Although the checks were made out to both Katrina and Lehecka, the Center processed the checks without Lehecka’s knowledge or signature and sent all of the proceeds directly to Katrina’s address instead of to Lehecka’s office. Evidently, Katrina’s address rather than Lehecka’s office address was shown on the electronic version of case information earlier sent to the Center.

Lehecka filed a motion in the district court, claiming the Center wrongfully paid the money due him to Katrina.

The Center challenged the district court’s jurisdiction, arguing Lehecka was required to intervene in the divorce action before he could recover his fees.

The Center also argued before the district court that checks sent to the Center often have two payees, usually when an ex-spouse is paying child support and the minor child’s name appears on the [284]*284check. Because the minor child’s name is not included in the case information given to the Center, the Center simply checks for two other points of identification on the check, such as the court case number and the correct name of the other payee. If two identification points are found, the check is processed even though it contains the child’s name as well. The Center claimed the problem that arose in this case cannot be avoided because of the large volume of checks it receives each day.

The district court held two hearings on Lehecka’s motion. Katrina attended the first hearing but not the second, despite having been subpoenaed by the Center.

At the first hearing, the court announced that the Center had been joined in the action. The court heard the parties’ arguments and instructed the Center to pay the entire amount of the property settlement and maintenance into the court. The court then decided that another hearing was needed to determine how the money paid into court would be disbursed.

At the second hearing, the Center argued that Katrina’s property settlement and maintenance amounts qualified as exempt property under K.S.A. 2004 Supp. 60-2308(e). The property settlement amount was exempt, it said, because it was based on proceeds from the sale of Katrina’s homestead and a portion of Wayne’s retirement account. The maintenance amount was exempt, the Center argued, because the district court had not entered judgment until 16 months after maintenance payments were to have begun.

The court found that there were two payees listed on the checks from Wayne and that the Center improperly processed the checks and paid all of the proceeds to Katrina. In addition, despite holding that the Center lacked standing to argue that the payments to Katrina qualified as exempt property, the district court said an amount equal to four of the monthly maintenance payments was exempt because those four payments were not yet past due at the time of the district court’s final order on the property settlement and support. The district court also ordered Katrina to indemnify the Center in the amount of $19,003.25.

Our analysis begins with the language of the attorney’s hen statute, K.S.A. 7-108, which reads:

[285]*285“An attorney has a lien for a general balance of compensation upon any papers of his or her client which have come into the attorney’s possession in the course of his or her professional employment, upon money in fhe attorney’s hands belonging to the client, and upon money due to the client and in the hands of the adverse party, in any matter, action or proceeding in which the attorney was employed, from the time of giving notice of the lien to the party; such notice must be in writing, and may be served in the same manner as a summons, and upon any person, officer or agent upon whom a summons under the laws of this state may be served, and may also be served upon a regularly employed salaried attorney of the party.”

To the extent this case requires interpretation of this statute, our standard of review is unlimited. See Cooper v. Werholtz, 277 Kan. 250, 252, 83 P.3d 1212 (2004).

The Center argues the district court erred in enforcing Lehecka’s attorneys’ hens against it, because it was not an adverse party and because it received no notice of the liens.

For his part, Lehecka argues that there was no need for the district court to enforce the liens. Rather, the liens were effective and properly enforced against Wayne, and Wayne dutifully made his checks payable to both Katrina and Lehecka. According to Lehecka, the Center had all the notice it deserved of Lehecka’s interest in the checks, because each was made payable to both Katrina and Lehecka; the Center nevertheless negotiated the checks without his endorsement, which was improper.

We agree with Lehecka that his liens were effective against Wayne, the adverse party in the divorce action. Under fhe plain language of the governing statute, Lehecka had hens “for a general balance of compensation . . . upon money due to fhe client and in the hands of the adverse party, in any matter, action or proceeding in which the attorney was employed, from the time of giving notice of the lien to the party.” K.S.A. 7-108. There is no dispute that Lehecka’s notice of the two liens was in writing and correctly served, and Wayne responded appropriately by naming Lehecka as one of the payees on the two checks.

In short, Lehecka’s hens had attached to the money represented by the two checks before the checks were ever forwarded to the Center. The more difficult issue before us is whether Lehecka’s hens were somehow defeated when the checks passed through the [286]*286Center. This court has not previously decided this legal issue, and related authorities from other jurisdictions are few.

Kysor Ind. Corp. v. D.M. Liq. Co., 11 Mich. App. 438, 161 N.W.2d 452 (1968), is closest to this case. In Kysor,

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Cite This Page — Counsel Stack

Bluebook (online)
109 P.3d 1212, 279 Kan. 282, 2005 Kan. LEXIS 151, Counsel Stack Legal Research, https://law.counselstack.com/opinion/lehecka-v-tier-technologies-inc-kan-2005.