In October 2015, Mr. Dzhurinskiy discharged Pager as his attorney and retained Novo Law Firm, P.C., to represent him.

Novo obtained a settlement for Mr. Dzhurinskiy from the defendant's insurer for the policy limit of $25,000.

Thereafter, Pager and Novo entered into a stipulation dated October 19, 2016 that provided that "the apportionment of the net attorney's fees in this matter shall be" 80 percent to Pager and 20 percent to Novo.

After the stipulation was executed, Novo settled Mr. Dzhurinskiy's claim for supplementary underinsured motorist ("SUM") coverage for $9,000.

Pager moved to enforce the stipulation dated October 19, 2016 and pursuant to New York Judiciary Law § 475 to impose a charging lien against 80 percent of the proceeds of the action, including any proceeds generated in connection with the SUM claim. In support of its motion, Pager submitted, among other things, an affirmation from its principal who affirmed that, after being retained to represent Mr. Dzhurinskiy in the action, Pager had obtained Mr. Dzhurinskiy's medical records and a police report regarding the accident, initiated a claim for no-fault benefits on behalf of Mr. Dzhurinskiy, entered into negotiations with the defendants' liability carrier, and drafted and filed a complaint on behalf of Mr. Dzhurinskiy.

Additionally, Pager, among other things, had filed a motion for summary judgment on the issue of liability, which the trial court granted in December 2013.

Following a fee dispute hearing, the trial court, in effect, granted Pager's motion only to the extent of directing Novo to pay him attorneys' fees in the total sum of $6,283.52, representing 80 percent of the attorneys' fees recovered in connection with the $25,000 settlement. The court determined that Pager was not entitled to any fee on account of the SUM recovery, which Novo had separately settled for $9,000.

Pager appealed.

The Appellate Court's Decision

The appellate court ruled that the trial court should have granted Pager's motion to enforce the stipulation dated October 19, 2016 and pursuant to Judiciary Law § 475 to impose a charging lien against 80 percent of the proceeds of the action in its entirety.

In its decision, the appellate court explained that an attorney of record who is discharged without cause possesses a charging lien pursuant to Judiciary Law § 475 that is imposed on the cause of action, and the proceeds of that cause of action – even where recovery may be obtained in an action different from the one in which the services were rendered.

Here, the appellate court continued, Pager demonstrated that it was discharged without cause, and that it had a charging lien against the proceeds of Mr. Dzhurinskiy's cause of action to recover damages for personal injuries sustained in the automobile accident.

Under the circumstances, the appellate court held, the proceeds of that cause of action included the funds recovered in connection with the settlement of Mr. Dzhurinskiy's SUM claim. It concluded that, consistent with the terms of the stipulation dated October 19, 2016, Pager established that it had a charging lien against 80 percent of the proceeds of the action, including the SUM recovery.

The case is Dzhurinskiy v. Moore, No. 2018-03398, 2018-10444 (N.Y. App. Div. 2d Dep't Oct. 2, 2019).