|Claimant(s):||THE OTHER HEIGHTS, LLC|
|Claimant short name:||THE OTHER HEIGHTS, LLC|
|Footnote (claimant name) :|
|Defendant(s):||THE STATE OF NEW YORK|
|Footnote (defendant name) :|
|Judge:||RICHARD E. SISE|
|Claimant's attorney:||GOLDSTEIN, RIKON, RIKON & HOUGHTON, P.C.
BY: Ashley Levi, Esq. and Joshua Rikon, Esq.
|Defendant's attorney:||MICHAEL HOWARD KANE, ATTORNEY AT LAW
BY: Jonathan D. Golby, Esq.
|Third-party defendant's attorney:|
|Signature date:||October 16, 2020|
|See also (multicaptioned case)|
The following papers were read on an application by Goldstein, Rikon, Rikon & Houghton, P.C. to enforce an attorney's lien against the judgment recovered by claimant in this action:
1. Order to Show Cause dated March 3, 2020;
2. Affirmation of Michael Rikon affirmed February 24, 2020 with Exhibits A-F annexed;
3. Affirmation of Jonathan D. Golby affirmed May 15, 2020 with Exhibits A-E annexed;
4. Affirmation of Michael Rikon affirmed May 20, 2020;
5. Letter by Michael Rikon dated July 10, 2020;
6. Letter by Jonathan D. Golby dated July 17, 2020.
Filed papers: None
Following a trial, the court awarded claimant direct damages for a partial taking of its property in White Plains, Westchester County as well as a sum for the taking of a temporary easement, both with statutory interest. Thereafter, the State issued the requisite closing documents which were transmitted to claimant, The Other Heights, LLC, by its attorney. Claimant, however, has refused to execute the closing documents thereby preventing the award from being disbursed. The refusal stems from a dispute regarding the attorney's handling of the underlying claim and has had the intended effect of preventing counsel from being paid its attorney's fees and disbursements. The attorney has now brought this application for the distribution of its attorney's fees and expenses and to be relieved of its representation of claimant in this matter.
In support of its application to enforce the lien Goldstein, Rikon, Rikon & Houghton, P.C. has submitted an affirmation by Michael Rikon, its president, together with a copy of the retainer agreement signed by the client/claimant, a certified copy of the Amended Judgment dated September 5, 2019 and a copy of the Certificate of No Appeal executed on behalf of the State of New York on September 27, 2019. In his affirmation Rikon explains that his firm was retained by The Other Heights, LLC (client/claimant) to represent its interest in seeking just compensation in the underlying condemnation proceeding. In the retainer agreement the client/claimant agrees to pay, and assigns to the attorneys, for their services, one third of all sums recovered, including interest, which exceed the written pre-vesting offer of $30,000. The agreement further provides that the client/claimant is responsible for paying any expenses, disbursements, appraisers' and experts' fee. Rikon avers that his firm prepared and filed a claim on the client/claimant's behalf, commenced a distribution proceeding after the State deposited the advance payment funds into an eminent domain account, secured and filed an appraisal report on the client/claimant's behalf and after thorough preparation, tried the case to the court. The trial resulted in a decision granting claimant a total award of $134, 375 plus interest. According to Rikon, the award, plus interest, as of the time of his affirmation, totaled $178,145.38 which he calculates as yielding an attorney's fee of $59,381.79. The closing statement created by the Goldstein firm also shows disbursements of $1,489.29.
In opposing the application the client/claimant does not contest the validity of the retainer agreement or the calculation of the amount claimed for attorney's fee and disbursements. Instead, it argues that in prosecuting the claim on its behalf, the Goldstein firm, though aware of the issue, neglected to include as damages in the appraisal report, and in the proof at trial, $89,158.00 in costs incurred by the tenant in relocating outdoor lighting and landscaping. According to the client/claimant, the tenant was obligated under the terms of the lease to perform this work, necessitated by the taking, and, also under the lease, was given a priority to the proceeds of any award made as a result of the condemnation. Consequently, the tenant will receive the funds it expended and the client/claimant will have to absorb those costs from its award. Thus, the client/claimant argues, the attorney's negligence has resulted in damages of at least $89,158.00 and its legal fee should reflect that fact or, at a minimum, the monies payable to the tenant should be excluded from the calculation of the fee.
Under Judiciary Law § 475 an attorney who appears for a party has a lien on their client's cause of action, claim or counterclaim. The lien arises at the commencement of an action, in any court, and attaches to, among other things, an award, settlement or judgment in the client's favor (Judiciary Law § 475). Furthermore, the statute authorizes the court, upon application of either the client or attorney, to determine and enforce the lien (see Carbonara v Brennan, 300 AD2d 528 [2d Dept 2002] [trial court where action was venued was proper forum to determine issue of counsel fees]). Here, the client/claimant does not argue that a lien did not attach or that the amount of the asserted lien, calculated with reference to the retainer agreement and the award, is incorrect. The issue it raises is whether the lien should be reduced in some amount based on the attorney's failure to pursue, as part of the claim, the amount expended by the tenant.
To resolve that question the court would need to determine whether the attorney committed legal malpractice in not pursuing those expenditures. However, whether the attorney "failed to exercise the ordinary reasonable skill and knowledge commonly possessed by a member of the legal profession and [whether] the attorney's breach of this duty proximately caused the [client] to sustain actual and ascertainable damages" (Jenkin v Cadore, 185 AD3d 558 [2d Dept 2020], quoting Bua v Purcell & Ingrao, P.C., 99 AD3d 843, 845 [2d Dept 2012]) cannot be fairly resolved on an application to enforce a lien for attorney's fees in part because the attorney would be deprived of its right to have the matter decided by a jury. A separate action for legal malpractice, as has already been commenced, is the appropriate proceeding to resolve the issues raised by the client/claimant.
Inasmuch as the attorney has established the existence of a lien and its amount and the client/claimant has not put forth a viable objection, the application should be granted. Furthermore, as The Other Heights, LLC has commenced a legal malpractice action against the Goldstein firm, the attorneys should be relieved of any further representation of claimant in this matter.
Accordingly, it is
ORDERED, that Goldstein, Rikon, Rikon & Houghton, P.C. is determined to have a lien in the amount of $60,871.08 against the judgment awarded in this matter and it is further
ORDERED, that The Other Heights, LLC is directed to cooperate in allowing the amount of the lien to be paid from the proceeds of the judgment held by the State of New York with respect to Claim Number 122616 and it is further
ORDERED, that Goldstein, Rikon, Rikon & Houghton, P.C. is relieved of its representation of The Other Heights, LLC in this action.
October 16, 2020
Albany, New York
RICHARD E. SISE
Judge of the Court of Claims