The Maryland high court last week suspended an attorney indefinitely for failure to honor a lien against his client’s case. He has a right to reapply to the bar after 6 months.
Two clients had small injury cases that collectively settled for a little over $25,000. The Food Employees’ Labor Relations Association and United Food and Commercial Workers’ Health and Welfare Fund had a lien on the case. Unlike almost every other non-military lien holder, this union demands full payment of its lien with no reduction for attorneys’ fees.
It is a great strategy by the union to get all of its money back. It is a terrible strategy for helping its workers get compensation for their injuries. Because when most lawyers see these agreements, they run for the hills unless it is a catastrophic injury case. Why? Because it is hard for both the lawyer and the client to get paid. No one wants to take a case where no one walks away happy.
When I first started doing plaintiffs’ work, I couldn’t believe the union could do this. But there is a case square on point.
Anyway, the rest of the story writes itself. He does not pay the liens nor does he interplead the funds. He ignores request after request for payment of the lien for years. He finally puts his own money into it when I guess he realized it just would not go away.
The lawyer’s defense to the case was, it part, one that usually sells well to me: he was fighting for the client’s money, not his own. So if he was being overly aggressive, it was just for his client’s benefit. But, my guess is that he did not cut his fee because he did not get a lien reduction. So, sometimes, counsel will try to ignore liens because it helps get a case settled that otherwise would not resolve if the lien is paid back. I don’t know if that happened here, but it sure is hard for a client to agree to settle a case with that 100% lien hanging over their head.
One important part of the story I have left out: this lawyer has been disciplined in the past for failure to honor liens.
The take-home message is that you have to pay back liens of which you are aware. Period. There is no way around it.
What is crazy about this case is that the accident in question occurred in 2002. That’s eleven years ago. The attorney in this case should have paid back the lien in 2003. Why it took 10 years for all of this to come to pass tells us a few things and none of them are good. But, however long it took to get there, I think the Court of Appeals made the right call here.