§ 5.20 Attorneys' Liens

• Jurisdiction: Arizona

§ 5.20 - Attorneys' Liens

To the extent an attorney assists an injured client with resolving their personal injury claim, those attorneys may have recovery rights against proceeds ultimately recovered for the injured client as well as anyone who tortiously interferes with those rights. State Farm Mut. Ins. Co. v. St. Joseph's Hosp., 107 Ariz. 498, 502, 489 P.2d 837, 841 (1971). Since an attorney's right to compensation is based upon contract, however, these rights may be secured by a "charging lien" or another equitable claim against proceeds recovered in a personal injury matter. E.g., 7A C.J.S. Attorney & Client § 443 (2008).

a. Charging Liens

An attorney has a right, called a "charging lien," to recover attorney's fees and costs from funds or property recovered by the attorney on behalf of a client.³³E.g., Langerman Law Offices, P.A. v. Glen Eagles at Princess Resort, LLC, 220 Ariz. 252, 254 ¶¶ 6-9, 204 P.3d 1101, 1103 (App. 2009). In practical terms, this can refer to proceeds obtained by an attorney or proceeds obtained by the client or client's agent under a judgment secured by the attorney in the client's favor. Richfield Oil Corp. v. La Prade, 56 Ariz. 100, 105, 105 P.2d 1115, 1118 (1940); Under v. Lewis, Roca, Scoville &Beauchamp, 85 Ariz. 118, 123, 333 P.2d 286, 289 (1958); 7A C.J.S. Attorney &Client § 468 (2008) ("[I]t is essential that there exist some subject matter to which such lien may attach.").

To create a charging lien, there must be evidence the attorney and client intended the attorney's fee be paid from a fund or property recovered by the attorney. E.g., Under, 85 Ariz. at 123, 333 P.2d at 289. In the personal injury context, a charging lien is typically a claim an attorney has against a judgment or proceeds from a contingent fee matter. In these cases, as required by Rule 42, Ariz. R. Sup. Ct, E.R. 1.5(c), there must be a written fee agreement signed by the client. Such an agreement will...