Attorney Stiffed For Contingent Fees Must Sue The Client, Not The Second Attorney For Breach Of Contract, But May Bring Both Client And Second Lawyer Into A Declaratory Relief Action To Set The Reasonable Value Of Services.

Plaintiff was the first lawyer to represent two clients in a personal injury case.  Defendant was the second lawyer.  Defendant obtained a settlement payment for the clients which he deposited in his client trust fund account. Plaintiff demanded payment of attorney fees from defendant; when he was unsuccessful, he sued defendant on the theory he was owed a portion of the settlement. The trial court sustained defendant’s demurrer to the second amended complaint because plaintiff failed to establish the existence, amount, and enforceability of his attorney fee lien in an independent action against the clients.  The appellate court affirmed, stating: “Unlike other liens, ‘an attorney’s lien is not created by the mere fact that an attorney has performed services in a case.’ [] An attorney’s lien is created only by an attorney fee contract with an express provision regarding the lien or by implication in a retainer agreement that provides the attorney will be paid for services rendered from the judgment itself.  It is well established that ‘[a]fter the client obtains a judgment, the attorney must bring a separate, independent action against the client to establish the existence of the lien, to determine the amount of the lien, and to enforce it.’ The appellate court further stated that an attorney’s lien is only enforceable after the attorney adjudicates the value and validity of the lien in a separate action, and that “if successful in a declaratory relief action regarding the reasonable value of his services, Plaintiff’s fees will be paid out of the clients’ settlement funds.” (Mojtahedi v. Vargas (Cal. App. Second Dist., Div. 3; August 8, 2014) 228 Cal.App.4th 974, [176 Cal.Rptr.3d 313].)