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Attorney charging liens

On Behalf of | Jan 17, 2020 | Lawsuits

An attorney who obtains a settlement or verdict for his / her client can assert a “charging lien” against the fund obtained. This usually happens when a lawyer working under a contingent fee agreement does some work that contributes to obtaining the settlement, then the client does not pay him or her for that work. The law protects the lawyer and gives him / her a charging lien to recover for the work done.

For a recent and decent review of the principles involved in charging liens, see Slater v. Ohio Dept. of Rehab. & Corr., 2018-Ohio-1475 (Dist. 10).

In KNR v. Progressive (2020), the Ohio Supreme Court held that an insurance company that settles a case with an injured party does not have any obligation to give a portion of the settlement to the injured party’s former lawyer pursuant to a charging lien.

Comment: In the KNR case, the case settled pre-suit, so no civil action existed. It is unclear if this ruling applies to cases in suit.

The key Ohio Supreme Court cases are old but still cited:

Olds v. Tucker, 35 Ohio St. 581 (1880)

Diehl v. Friester, 37 Ohio St 473 (1882)

Cohen v. Goldberger, 109 Ohio St. 22 (1923)

In Cohen, the Ohio Supreme Court held that “the right of an attorney to payment of fees earned in the prosecution of litigation to judgment, though usually denominated a lien, rests on equity of such attorney to be paid out of the judgment by him obtained, and is upheld on the theory that his services and skill created the fund.” Cohen, 109 Ohio St. 22 at paragraph one of the syllabus.

Other appellate cases include:

Petty v. Kroger, 2005-Ohio-6641 (Dist. 10)

Kerger & Hartman, LLC v. Ajami, 2015-Ohio-5157 (Dist. 6)

Galloway v. Galloway, 2017-Ohio-87 (Dist. 8)