What are attorney charging liens, and how do they apply in Florida?
When an attorney does work for a client and the client fails to pay, what are the remedies available to the attorney in order to recover payment? Obviously, filing a lawsuit against the recalcitrant client would be one tactic. However, in situations where there is a lawsuit pending, it is possible for the attorney to seek a charging and/or retaining lien in the case.
A retaining lien allows the attorney to keep all files, documents, assets and evidence from being turned over to the former client until the outstanding bill has been paid. A charging lien is a claim against the case that requires other attorneys or other parties to be honored if and when the case is settled. There are circumstances where parties, insurance companies, lawyers and even perhaps adjusters could be held personally responsible for failing to honor a proper charging lien. Once the lien has been claimed, turning over monies or other assets to the former client could subject personal responsibility over the person doing that. In family law cases, it is not that unusual for withdrawing lawyers to also seek a charging lien on the assets of the client. All retainer agreements should have language to that effect.
Several years ago it was not unusual for lawyer retainer agreements to waive Homestead protection by the client so that there was an additional incentive to pay the outstanding bill. However, in 2007 the Florida Supreme Court in the case of Chames v. DeMayo, held that homestead waivers in attorney retainer agreements were unenforceable. It would almost require a second attorney be brought in to advise the client on Homestead waivers before he/she signs the contract with the additional lawyer. However, there are still circumstances and situations in which liens against a client’s Homestead protected property are entered. Recently, the Florida 2nd district Court of Appeal threw out an attorneys charging lien that attempted to impose a lien on homestead protected property. In the case of Felice v. Sutherland Pullen Law, PLLC; it did not appear that the attorney or the judge was aware of the Chames decision. When the trial court entered a recorded charging lien against the former clients Homestead protected property, it did not take much thought for the Florida 2nd DCA to reverse the order.
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