Westerlund v. Peterson

Stone, J. This proceeding results from two actions commenced in the district court. One was to recover' the expenses incurred by plaintiff in caring for her minor son, after injuries sustained by him through the alleged negligence of defendant. The companion case for the son’s benefit sought damages for the injuries. The respondents, Messrs. Lewis & Hunt, attorneys at law, were retained to conduct both cases. The actions were commenced and settled. By the settlement, approved of course by plaintiff, it was agreed that judgment be entered in the mother’s case for $1,200 and in the son’s for $1,550. Judgments were so entered and collected and the money paid to plaintiff’s attorneys. They retained $450 as their fee in the mother’s case and $550 in the son’s making their total charge $1,000. As between plaintiff and her attorneys, the settlement was intended to be final. The fee, while large, was somewhat less than the attorneys were entitled to by their contract with plaintiff. There the matter rested for some time. Apparently, it was a closed incident, and rapidly becoming ancient history. But it came to the notice of Messrs. Lewis & Hunt that friends of their erstwhile client had interested themselves in her affairs and were criticizing the settlement because of the size of the attorney’s fee. So, to have the matter settled, if they could, some four months after the settlement, the attorneys petitioned the district court for an order directing plaintiff ito show cause why a judge of that court should not, in the summary statutory proceeding, determine the amount of their fees in each of the cases. The order issued and plaintiff appeared specially and moved that the petition be stricken from the record upon the ground that the court had no jurisdiction to hear and determine the matter in a summary proceeding. After a hearing, the court made an order denying plaintiff’s motion. This appeal .is from that order. — 382 — Tlie only question presented is one of statutory construction, the statute involved being section 4955, G. S. 1913, as amended by chapter 98, p. 121, Laws 1917, relating to the liens of attorneys. The provisions of section 4955 with which we are concerned are these: An attorney has a lien for his compensation * * *. 1. Upon the papers of his client coming into his possession in the course of his employment. 2. Upon money in his hands belonging to his client. 3. Upon the cause of action from the time of the service of the summons therein, or the commencement of the proceeding, and upon the interest of his client in wtvy money or property involved in or affected by any action or proceeding in which he may have been employed, from the commencement of said action or proceeding, and, as against third parties, from the time of filing the notice of such lien claim, as provided in this action. 4. Upon the money or property in the hands of the adverse party to the action or proceeding in which the attorney was employed, from the time such party is given notice of the lien. 5. Upon a judgment * * *. 6. The liens provided by subdivision S, Jj and 5 of this section m.ay be established, and the amount thereof determined, by the court, summarily, in the action or proceeding, on the application of the lien claimant or of any person or party interested in the property subject to such lien, on such notice to all parties interested therein as the court may, by order to show came, prescribe, or, such liens may be enforced, and the amount thereof determined, by the court, in an action for equitable relief brought for that purpose. The italics are those used in the 1917 amendment to indicate the new matter. The question then is whether Messrs. Lewis & Hunt have the right under the statute to take the initiative, hale their former client into court and compel her to submit, in a summary proceeding under subdivision 6, to a final adjudication of her claim, whatever it may be. That question we answer in the negative and for reasons as follows: — 383 — It will be observed that the proceeding furnished by subdivision 6 does not apply to liens under subdivisions 1 and 2, but includes only those arising under subdivisions 3, 4 and 5. If there is anything upon which the attorneys here have a lien, it is money in their hands belonging to their client. It is a case within subdivision 2. If subdivision 3 is construed to include cases such as this, whether there has been a settlement or not, subdivision 2 is made surplusage. It is rendered utterly meaningless. That is one reason for avoiding the construction of the statute necessary to sustain the position of the attorneys in the instant case. Subdivision 3, if it stood alone, would lend itself to the broad construction contended for. But it is just as susceptible of the narrower interpretation restricting to the interest of the client in money or property not in the possession or exclusive control of the attorney claiming the lien, but in whole or in part still in the possession or under the control of the court, an adversary, or even a stranger to the action. That is probably the only result intended b.y the amendment because, under the old law, the lien attached only to “money in the hands of the adverse party.” There is still another and more compelling view restricting subdivision 3 within the limits indicated. When the proceeding was commenced there had been a settlement between attorneys and client. They had nothing, and now have nothing, belonging to her. There is no property of the clients in their hands to which a lien can attach. Neither have the attorneys any further claim against the client. The potentiality of the situation responsible for this proceeding is that the client may assert a claim against the attorneys. If she does, it will be a claim for money. She may rescind, or seek to have rescinded, the settlement, and sue for money. This proceeding discloses no evidence to support such a claim. But it may be asserted, and by an action to recover money, in which the client will have the constitutional right to trial by jury — a right of which no statute can deprive her. — 384 — There is some difficulty, arising from the language of subdivision 3 as amended, in the way of excluding this case from its effect. But to include it, and in such manner as to compel the client to submit to the summary statutory procedure and the resulting loss of her right to trial by jury, would render the statute pro tanto unconstitutional. To avoid that result — one to be avoided whenever possible — we must not extend subdivision 3 to cases where the lien sought to be enforced is merely the retaining lien of the common law, and the property affected is in the possession and exclusive control of the attorney. The liens under subdivisions 1 and 2 are the retaining liens of the common law. They are entirely passive — possessory only — and of benefit to the attorney only when the client proceeds against him. Then they are matters of defense and his lien must be satisfied before he is deprived of the possession (of the client’s property), upon which the lien is predicated. Therefore, if the attorneys here had any money belonging to their client, the plaintiff, all they could do would be to retain it, await her action to recover it and then set up their lien. In such a case, if one is commenced, plaintiff’s claim, we repeat, will be for the recovery of money, and her right to a jury trial is assured by section 4 of article 1 of the Constitution of Minnesota. We do not overlook the fact that a suit to enforce a lien is ordinarily equitable in nature and not attended by the right to a jury trial. That does not alter the result for the simple reason that the presence of a lien as a defense cannot change plaintiff’s claim at law to one in equity and thereby take away her right to a jury trial. The statement in 24 Cyc. 116, that the rule that suits to enforce liens are of an equitable nature and “not of right triable by jury” applies in the case of attorneys only to charging liens, where the attorney has the right to initiate the action to enforce the lien. It cannot apply — and the cited authorities so indicate — to retaining liens as to which the attorney has no right to initiate proceedings. One of those cases is Hill v. Phillips’ Admr. 87 Ky. 169, 7 S. W. 917, where an attorney sought to enforce a charging lien. Although he was the moving party, the court held that the client was entitled to a jury trial and said: — 385 — “In the case at bar the appellant’s lien, if any he had, depended upon the result of the legal issue as to the value of his services. The appellees contended that he had been paid the full value of his services. The issue was one of fact, which was to be determined by common law principles. Either party had the right to have the issue settled by a jury. Therefore, the circuit court did right in transferring the issue to the ordinary docket to be tried by a jury.” Crissman v. McDuff, 114 Iowa, 83, 86 N. W. 50, also cited in Cyc. clearly supports the client’s right to a jury trial in a case such as this. The proceeding was by the attorney to enforce his lien on a judgment. The client, under the statutes of Iowa, had a right to discharge the lien. He did not avail himself of that right and the court said: “Had defendant filed his bond before an action to foreclose the lien was begun, plaintiff would have been obliged to proceed at law,” in which event there would have been a trial by jury. That view, for Iowa at least, was confirmed and made settled law in Jamison & Smyth v. Ranck, 140 Iowa, 635, 119 N. W. 76. It is true that in Standidge v. Chicago Rys. Co. 254 Ill. 524, 98 N. E. 963, 40 L. R. A. (N. S.) 529, Ann. Cas. 1913C, 65, a proceeding to enforce a charging lien on the amount of a settlement in a personal injury action, it was held that there was no right of trial by jury. But the result was put upon the assumption that the controlling statute created a new right, not known to the common law, and that it was “clearly within the power of the legislature to provide for the enforcement of such rights without a jury trial.” That is good law. But applied to the instant case it would give scant recognition to the client’s right to have her money demand against her former attorneys — if she asserts one — passed upon by a jury. By extending equitable jurisdiction to new subjects, the legislature cannot impair the right to trial by jury. It cannot “confer equity jurisdiction * * * in matters in respect to which such jurisdiction did not exist before the adoption of the Constitution, and draw to it a legal cause of action cognizable exclusively in a law court and triable by jury, and have both tried by a court without a jury.” Wiggins & Johnson v. Williams, 36 Fla. 637, 657, 18 South. — 386 — 859, 30 L. R. A. 754, citing Scott v. Neely, 140 U. S. 106, 11 Sup. Ct. 712, 35 L. ed. 358. There being no ground upon which the statute can be construed to deprive appellant of her constitutional right to have her claim against respondents, if she asserts one, tried by a jury, there must be a reversal. So ordered.