Opinion
XXXXX
09-08-2021
A.H., Plaintiff, v. Y.G., Defendant.
Recitation as required by CPLR 2219 (a) of the papers considered:
Papers Numbered
Order to Show Cause, Affidavits (Affirmations),
and Exhibits Annexed NYSCEF Doc Nos. 81-87
Cross Motion, Affidavits (Affirmations), and Exhibits Annexed NYSCEF Doc Nos. 88-102
Answering Affidavits (Affirmations), and Exhibits NYSCEF Doc Nos. 103-110, 130-131
Reply Affidavits (Affirmations), and Exhibits NYSCEF Doc Nos. 199
Transcript of June 30, 2021 Oral Argument NYSCEF Doc Nos. 208
Upon the foregoing papers and all prior proceedings in this matrimonial action, the court finds as follows:
Defendant moved by order to show cause (OSC) filed on December 10, 2019, for an order: (1) pursuant to Judiciary Law section 753 and the Order dated November 18, 2019 (Ciccotto, J.), issuing a warrant of commitment and order of arrest for Plaintiff to be committed to the county jail for his failure to comply with prior orders of this court entered on June 26, 2018, September 13, 2018, July 3, 2019, September 5, 2019, and November 18, 2019, and finding that he has deliberately failed and refused to purge his contempt; (2) pursuant to the order dated November 18, 2019 (Ciccotto, J.), directing the Sheriff to arrest Plaintiff and commit him to the custody of the Department of Corrections or county jail until he purges his contempt by making all outstanding payments in compliance with the November 18, 2019 order and all prior orders of this court; (3) pursuant to Domestic Relations Law (DRL) section 238, and Judiciary Law sections 770 and 773, renewing and revising Defendant's previous applications dated August 16, 2019 and November 14, 2019 for, and granting to Defendant, the sum of $25,775 as and for counsel fees for the necessity of this order to show cause as mandated by Plaintiff's adjudicated contempt of four court Orders with leave to request further fees; (4) pursuant to DRL section 238, and Judiciary Law sections 770 and 773, granting Defendant the additional sum of $4,500 as and for counsel fees for the necessity of this order to show cause, with leave to request further fees; and (5) pursuant to the November 18, 2019 Order and Judiciary Law section 753, sanctioning Plaintiff in the sum of $10,000 for repeated and continuous adjudicated contempt of court, resulting in severe prejudice and hardship to Defendant and endangering the welfare of the parties’ children (motion sequence no. 8).
Defendant's former counsel, Mazur, Bocketti, Nisonoff & Khavulya, P.C. (the Mazur Firm), moved by OSC filed on January 23, 2020, for an order: (1) granting the Mazur Firm leave to withdraw as counsel for Defendant; (2) granting the Mazur Firm a retaining lien in the sum of $168,507.21 as and for legal services and disbursements rendered and incurred on behalf of Defendant and fixing said fee and lien; and (3) pursuant to Judiciary Law section 475, granting the Mazur Firm a charging lien in the sum of $168,507.21 upon the proceeds of the judgment recovered by Defendant in this action (motion sequence no. 10).
Motion sequence numbers 8 and 10 were referred to Special Referee Diana J. Szochet (the Special Referee) by Order dated July 24, 2020, to hear and report with recommendations as to the issues of "granting Defendant's former [a]ttorney a charging lien and/or retaining lien [and] for contempt" (NYSCEF Doc No. 3). The Special Referee issued a Report with Recommendations dated April 12, 2021 (the Report) (NYSCEF Doc No. 64).
Plaintiff moved by OSC filed on April 26, 2021, for an order pursuant to 22 NYCRR section 202.44, confirming the report of Special Referee Diana J. Szochet dated April 12, 2021, in its entirety (motion sequence no. 14).
The Mazur Firm cross-moved on May 3, 2021, for an order: (1) determining motion sequence number 8 de novo , on the grounds that the Special Referee was not empowered, and had no authority under the order of reference, to consider and make a recommendation as to the remedy and relief requested in motion sequence number 8 as such remedy rests with the court; or alternatively, (2) rejecting the Special Referee's failure and refusal to consider and make a recommendation as to the imposition of punishment for Plaintiff's failure to comply with his obligation to pay the Mazur Firm the $40,000, for which he has already been adjudicated in contempt, and that this court determine motion sequence number 8. The Mazur Firm further seeks an order incarcerating Plaintiff until he purges his contempt and awarding movant $30,273 as and for counsel fees. The Mazur Firm further seeks an order: (i) rejecting, as a matter of law, the Special Referee's recommendation that the Mazur Firm is not entitled to a charging lien until after a hearing at the end of the litigation as contrary to statutory and case law, and (ii) awarding the Mazur Firm a charging lien in the sum of $168,507.21 (motion sequence no. 15).
BACKGROUND
The parties were married on March 18, 2004. Three children were born of the marriage, all of which are unemancipated. Plaintiff commenced this action for divorce by summons with notice filed on July 24, 2017. Defendant formally appeared in this action through her then attorneys, the Mazur Firm, by notice of appearance filed on August 17, 2017.
On May 10, 2018, Defendant moved by OSC, inter alia, for an award of counsel fees (motion sequence no. 1). The parties resolved the issues raised in Defendant's motion by so ordered stipulation dated June 26, 2018. Therein, Plaintiff agreed to pay to the Mazur Firm $10,000 for interim counsel fees on or before July 27, 2018. Upon Plaintiff's failure to pay, the Mazur Firm was granted permission to enter judgment without further notice. Upon affirmation of Plaintiff's default by Mirra Khavulya, Esq. of the Mazur Firm, a judgment was entered against Plaintiff in favor of the Mazur Firm in the amount of $10,000 on August 8, 2018,
An order dated September 13, 2018, requires Plaintiff to satisfy the August 8, 2018 judgment by paying as follows: $3,000 on or before September 30, 2018; $3,000 on or before October 30, 2018; $3,000 on or before November 30, 2018; and $1,000 on or before December 30, 2018. On March 1, 2019, Plaintiff filed the note of issue and certificate of readiness for trial.
Thereafter, Plaintiff moved to quash subpoenas served upon nonparties on April 11, 2019 (motion sequence no. 4) and Defendant cross-moved on May 7, 2019 for an award of interim counsel fees in the sum of $85,000 to be paid directly to the Mazur Firm (motion sequence no. 5). Pursuant to the court's decision and order dated July 3, 2019, Defendant was awarded interim counsel fees in the sum of $40,000. Plaintiff was ordered to pay this amount directly to the Mazur Firm within 20 days of service of a copy of the decision and order upon him. The July 3, 2019 decision and order granted the Mazur Firm leave to enter a judgment for the full amount due and owing, plus statutory interest, upon 20 days written notice of default. The Mazur Firm served a copy of the decision and order with notice of entry upon Plaintiff's attorney on July 9, 2019.
Defendant then moved by OSC filed on August 19, 2019, for an order, inter alia , finding Plaintiff in contempt for his failure to pay $40,000 to the Mazur Firm as required by the July 3, 2019 decision and order (motion sequence no. 6). A second judgment was entered against Plaintiff in the amount of $40,000 on August 28, 2019, upon affirmation of default by Mirra Khavulya, Esq. of the Mazur Firm. While Defendant's OSC was pending, the court issued an order dated September 5, 2019, which directed Plaintiff to pay the Mazur Firm $40,000 past due counsel fees as follows: $20,000 on or before September 10, 2019; and $20,000 on or before September 25, 2019.
Defendant's motion sequence number 6 was granted by Order dated November 18, 2019. The court found Plaintiff in contempt of the Orders dated June 26, 2018; September 13, 2018; July 3, 2019; and September 5, 2019. Plaintiff was afforded an opportunity to purge his contempt by, among other things, paying $40,000 to the Mazur Firm by December 3, 2019. If Plaintiff failed to timely pay, the Order states "the court will consider the prospect of commitment [and] other relief under DRL [and] Judiciary Law." The Order further scheduled the matter for trial.
Defendant filed the instant motion sequence number 8 on December 10, 2019, seeking contempt-related relief. Thereafter, the Mazur Firm moved by OSC on January 23, 2020, to be relieved as Defendant's counsel and for entry of retaining and charging liens (motion sequence no. 10). The firm of Cox Padmore Skolnik & Shakarchy LLP was substituted as attorneys of record for Defendant in place and instead of the Mazur Firm by consent to change attorney dated January 31, 2020 and filed with the County Clerk on February 26, 2020. Defendant further retained Kenneth E. Stroup, Jr., Esq. for the limited purpose of defending against the Mazur Firm's applications to impose retaining and charging liens against Defendant. The court referred the issues raised in motion sequence numbers 8 and 10 to the Special Referee by Order dated July 24, 2020 (NYSCEF Doc No. 3). Specifically, the referral Order states that the referee shall hear and report with recommendations on the issues of "granting Defendant's former [a]ttorney a charging lien and/or retaining lien [and] for contempt."
This action was converted to e-filing by stipulation filed on September 3, 2020. The Special Referee issued the Report on April 12, 2021 (NYSCEF Doc No. 64). The Report returned the issue of contempt to the court with no findings of contempt and/or recommendations regarding a remedy for Plaintiff's failure to purge as the Special Referee found that the referral order did not empower the Special Referee to consider an appropriate remedy for Plaintiff's failure to comply with his obligation to pay the Mazur Firm $40,000. The Report further recommended that a hearing on former counsel's asserted charging lien be deferred to the end of the proceeding. In the interim, the Report noted that the Mazur Firm is able to commence a plenary action against Defendant to recover any/all fees to which it believes it is entitled.
Plaintiff moved by OSC on April 26, 2021 to confirm the Report in its entirety (motion sequence no. 14). Defendant cross-moved on May 4, 2021 to, among other things, reject the Report (motion sequence no. 15). Oral argument on the instant motions was held on June 30, 2021, virtually by Microsoft Teams (see NYSCEF Doc No. 204).
PARTIES’ CONTENTIONS
Plaintiff's Contentions
Plaintiff seeks to confirm the Report in all respects. Plaintiff maintains that the Referee appropriately considered the relevant factors and those findings should be undisturbed (NYSCEF Doc No. 85, Seckular Aff dated 4/26/2021 at ¶ 4-5).
Plaintiff argues that the Mazur Firm's cross-motion must be denied in its entirety. First, Plaintiff submits that the cross-motion is defective in that it fails to comply with the times frames set forth in CPLR 2214 (b) and the Judiciary Law (NYSCEF Doc No. 103, Seckular Reply Aff dated 5/5/2021 at ¶ 18). Next, he asserts that because the Mazur Firm failed to include the statutorily mandated language required by Judiciary Law section 756 in both the cross motion (motion sequence no. 10) and the motion upon which it seeks a de novo determination (motion sequence no. 8), the court cannot consider any request for Plaintiff's incarceration (id. at ¶ 19). Plaintiff's counsel further insists, "[w]hile [the Mazur Firm] repeatedly references that Plaintiff has been ordered to be imprisoned, the Court only referenced that it would consider the same upon a further application" (id. at ¶ 21).
Exhibit A to Plaintiff's OSC contains information regarding Plaintiff's current financial circumstances. He argues that he is incurring financial hardships due to the COVID-19 pandemic and is contending with a lack of assets and mounting debts (id. at ¶ 27). Accordingly, Plaintiff requests, at a minimum, a hearing regarding his inability to pay (id. at ¶ 31).
Plaintiff further argues that a charging lien is inappropriate at this stage and any request for same must be held in abeyance to be determined at a hearing at the conclusion of trial after a decision by the court or settlement between the parties (id. at ¶ 11).
The Mazur Firm's Contentions
The Mazur Firm, on the other hand, seeks to reject the Report of the Special Referee. The Mazur Firm first argues that motion sequence number 8 should have been determined by the court prior to its referral to the Special Referee (NYSCEF Doc No. 88, Mazur Aff dated 5/3/2021 at ¶ 3). Since the motion was not decided by the court and the referral Order did not empower the Special Referee to determine the motion, the Mazur Firm seeks a de novo determination of motion sequence number 8 (id. at ¶ 3-4). Upon a de novo review, the Mazur Firm seeks imprisonment and counsel fees for bringing this motion pursuant to the DRL and Judiciary Law.
It further argues that the Special Referee disregarded and misapprehended the law regarding charging liens (id. at ¶¶ 7, 98). The Mazur Firm argues that it was discharged, on consent, as evidenced by the consent to charge attorney and Defendant's concession in her affidavit that they "worked well together" without disagreement (id. at ¶¶ 104-106). It also argues that, as a matter of law, a fact-finding hearing is unnecessary since the law firm's accounts were received and retained by Defendant without objection within a reasonable period of time (id. at ¶ 8). The Mazur Firm avers that from January 12, 2017 to February 4, 2020 it sent Defendant at least 21 itemized invoices (id. ).
Defendant's Contentions
Defendant states that the issue of a retaining lien is moot because the Mazur Firm transferred the entire file to Defendant's new counsel on October 13, 2020 (NYSCEF Doc No. 130, Defendant's Memorandum of Law [Memo] dated 12/4/2020). With respect to a charging lien, Defendant asserts that a charging lien is improper for two reasons. First, she argues that a new fund for equitable distribution has not yet been created and if one is established, it would be the result of actions taken by Defendant's new counsel and not the Mazur Firm (id. ).
Second, Defendant claims that the Mazur Firm sought leave to withdraw without cause and without reasonable notice (id. ). Defendant submits that, prior to retaining the Mazur Firm, she explained to the Mazur Firm that she did not have funds of her own to pay for legal fees (NYSCEF Doc No. 130, Defendant's Aff dated 3/16/2020 at ¶¶ 1-2). She borrowed $12,500 for the retainer fee and asserts that she was not asked to restore the retainer amount once the $12,500 was depleted (id. at ¶¶ 3-4). Defendant avers that she fully cooperated with the Mazur Firm throughout their time as her counsel (id. at ¶ 5). She further states that she did not discharge the Mazur Firm as her counsel, but rather that the Mazur Firm advised her on January 9, 2020, that it would withdraw as counsel unless she paid a $100,000 trial retainer by January 17, 2020 (id. at ¶ 6).As a result, Defendant states that, given her financial situation, she was left with no choice but to search for new counsel (id. ).
DISCUSSION
Confirm/Reject the Report
CPLR 4403 empowers this court to confirm or reject, in whole or in part, the recommendations and report of a referee, to make new findings with or without taking additional testimony, and to order a new trial or hearing (see also 22 NYCRR § 202.44 ). "The referee's findings and recommendations are advisory only and have no binding effect on the court, which remains the ultimate arbiter of the dispute" ( Bank of New York Mellon v Graffi , 172 AD3d 1148, 1149 [2d Dept 2019] ).
A court should confirm a referee's report and adopt the recommendations made therein whenever the referee's findings are substantially supported by the record, and the referee has clearly defined the issues and resolved matters of credibility ( Rosselli v Passalacqua , 163 AD3d 596, 597 [2d Dept 2018] ; Faistman v Faistman , 165 AD3d 1042, 1043 [2d Dept 2018] ; Shen v Shen , 21 AD3d 1078, 1079 [2d Dept 2005] ). Otherwise, the court may reject or modify the recommendations or conduct a new hearing pursuant to its authority under CPLR 4403.
Contempt
By Order dated July 24, 2020, another Justice of this court referred the issues of motion sequence number 8 and generally the issue of "contempt" to the Special Referee. The Report subsequently issued by the Special Report states, in relevant part,
[a]s the Order of Reference is limited by its terms to "contempt," rather than "incarceration" (or any other remedy that has been requested), the latter are not within the [Special Referee's] purview As the [Special Referee] has not been empowered by order to consider an appropriate remedy for Plaintiff's failure to comply with his obligation to pay Defendant's former counsel $40,000.00, and the authority to impose such remedy rests with the Court, the matter is herewith returned to [the court] with no findings of contempt (as explained above) and/or recommendations regarding a remedy for Plaintiff's failure to purge or the propriety of concomitant requests for fees
(NYSCEF Doc No. 64, Report at p 8).
A plain reading of the referral Order supports an understanding that the entirety of motion sequence number 8, to the extent not already decided, was referred to the Special Referee for a recommendation on the appropriateness of the relief requested therein. In this instance, the Report makes no recommendations for this court to confirm or reject. Considering the substantial delay that would result from merely sending this issue back to the Special Referee without any additional guidance or narrowing of issues, this court will conduct a de novo review of the relief sought in motion sequence number 8.
As an initial matter, the Mazur Firm, as discharged counsel, has standing to seek counsel fees in this proceeding. The Court of Appeals has clearly stated that under DRL section 237 (a), an attorney discharged without cause in a matrimonial action may seek counsel fees against the monied spouse ( Frankel v Frankel , 2 NY3d 601, 606 [2004] ; see also Crocker C. v Anne R. , 52 Misc 3d 676, 679 [Sup Ct, Kings County 2016] [Sunshine, J.]).
As to the issue of contempt, contempt proceedings are governed by Judiciary Law section 750 et seq. , and the requirements contained therein must be strictly construed ( Ortega v City of New York , 11 Misc 3d 848, 863 [Sup Ct 2006], affd 35 AD3d 422 [2d Dept 2006], affd 9 NY3d 69 [2007] ). Because the court's contempt power includes imprisonment, Judiciary Law section 756 requires that an application seeking to hold a party in contempt state on its face that,
the purpose of the hearing is to punish the accused for a contempt of court, and that such punishment may consist of fine or imprisonment, or both, according to law together with the following legend printed or type written in a size equal to at least eight point bold type:
WARNING:
YOUR FAILURE TO APPEAR IN COURT MAY RESULT IN YOUR IMMEDIATE ARREST AND IMPRISONMENT FOR CONTEMPT OF COURT.
Failure to strictly comply with these statutory safeguards renders the court without jurisdiction to punish the disobedient party for contempt (see Community Preserv. Corp. v N. Blvd. Prop., LLC , 139 AD3d 889, 890 [2d Dept 2016] ; Cappello v Cappello , 274 AD2d 538, 539 [2d Dept 2000] ).
Where, as here, a contempt order has been issued, it is not for this court to consider any assertion by either party that the order was improper or failed to give relief which was justified by the facts (see Ketchum v Edwards , 153 NY 534, 539 [1897] ). In defining the public policy regarding respect for the action of courts in issuing prior orders, the Court of Appeals has stated, "The interest in maintaining respect for the action of courts, and of orderly jurisprudence, forbids that litigants should be permitted, under plea of hardship or injustice, real or pretended, to nullify or set at naught orders or decrees, however improvidently made, even if it may seem certain that the court acted in granting them under misapprehension or mistake" (id. ). This policy is consistent with the general rule that a judge is without authority to "review or overrule an order of another judge of coordinate jurisdiction in the same action or proceeding" ( Lew v Sobel , 172 AD3d 1208, 1210 [2d Dept 2019], quoting Wright v Monroe County , 45 AD2d 932, 932 [4th Dept 1974] ). Therefore, absent modification or reversal of the underlying order, this court is only required to answer whether said order clearly expressed an unequivocal mandate to support a finding of contempt (see El-Dehdan v El-Dehdan , 26 NY3d 19, 29 [2015] ).
Here, this court is constrained to interpret the November 18, 2019 order (the Contempt Order) as it remains the law of this case. Therein, another Justice of this court found Plaintiff in contempt of the Orders dated June 26, 2018; September 13, 2018; July 3, 2019; and September 5, 2019. The Contempt Order, however, did not state the portions of said orders with which Plaintiff failed to comply. The Order directed Plaintiff to purge his contempt by paying, among other things, $40,000 to the Mazur Firm by December 3, 2019. Upon Plaintiff's failure to pay, the Contempt Order states, "the Court will consider the prospect of commitment [and] other relief under DRL [and] Judiciary Law." It is clear from a plain interpretation of the Contempt Order, specifically the failure to pay provision, that the court declined to impose a term of imprisonment upon Plaintiff if he did not comply with the payment terms specified therein. Instead, the Court implicitly authorized further motion practice as permitted under the DRL and Judiciary Law should Plaintiff fail to comply with lawful mandates of the court. In other words, the Mazur Firm was required to file a new application for contempt.
The Mazur Firm's OSC filed under motion sequence number 8 effectively seeks to do exactly what the court authorized — a new application for contempt. While proper pursuant to the Contempt Order, the Mazur Firm's application suffers from a fatal flaw. As pointed out by Plaintiff, the OSC fails to include the mandated statutory notices. The Mazur Firm cannot overcome this defect by arguing that it only seeks enforcement of the Contempt Order as such Order merely suggested the prospect of imprisonment should another application for contempt be properly brought. Here, the application is defective on its face.
Therefore, the Mazur Firm's application for imprisonment, sanctions, and counsel fees pursuant to this court's contempt power under the DRL and Judiciary Law is denied without prejudice due to the defects stated above. In the interim, the Mazur Firm is free, if it so chooses, to pursue any other remedy available to enforce the money judgments entered by the County Clerk. The Report is confirmed insofar as it sends the issue back to the court for a proper determination.
Charging/Retaining Lien
A client has an absolute right to discharge an attorney at any time ( Cohen v Grainger, Tesoriero, Bell , 81 NY2d 655, 658 [1993] ). An attorney's right to recover fees rests on the determination of whether he or she has been discharged by the client for cause or without cause. An attorney who is discharged without cause has three separate and distinct remedies available: (1) a retaining lien, which permits the attorney to retain all of the client's papers and files until all fees are paid; (2) a charging lien against any judgment or settlement in favor of the client; and (3) a plenary action in quantum meruit seeking a judgment for the reasonable value of the services, which would be enforceable against all of the client's assets ( Butler, Fitzgerald & Potter v Gelmin , 235 AD2d 218, 218—219 [1st Dept 1997] ). "These remedies are not exclusive, but cumulative" ( Schneider, Kleinick, Weitz, Damashek & Shoot v City of New York , 302 AD2d 183, 186 [1st Dept 2002] ).
Where, however, an attorney is discharged with cause, neither a retaining lien nor a charging lien may be asserted ( Teichner by Teichner v W & J Holsteins, Inc. , 64 NY2d 977, 979 [1985] ; In re Weitling , 266 NY 184, 185 [1935] ).
In a matrimonial action, an attorney seeking a lien due to nonpayment must satisfy two threshold issues. First, the attorney may only recover if discharged without cause. Second, the attorney must satisfy the conditions precedent to recovery of legal fees (22 NYCRR § 1400 et seq. ; see Bishop v Bishop , 295 AD2d 382 [2d Dept 2002] ).
As to the grounds for discharge, in a general context, cause to discharge may be based upon impropriety, negligence, or misconduct on the part of the attorney; however, poor client relations, differences of opinion, or personality conflicts do not amount to cause ( Maher v Quality Bus Serv., LLC , 144 AD3d 990, 992 [2d Dept 2016], quoting Roe v Roe , 117 AD3d 1217, 1218 [3d Dept 2014] ). A finding of discharge for cause would extinguish the attorney's retaining lien on the client's files and preclude a charging lien on the client's equitable distribution award.
In the matrimonial context, compliance with the rules promulgated in 22 NYCRR section 1400 et seq. is also a requirement for the recovery of legal fees by lien. 22 NYCRR section 1400 et seq. was enacted to remedy abuses in the practice of matrimonial law and as a means to better protect the public ( Gahagan v Gahagan , 51 AD3d 863, 864 [2d Dept 2008] ). The rules set forth therein apply to all attorneys who represent clients in divorce actions ( 22 NYCRR § 1400.1 ). A failure to abide by these rules may result in preclusion from recovering legal fees in a divorce action ( Gahagan , 51 AD3d at 864 ). However, "substantial, not strict, compliance with 22 NYCRR 1400 et seq. , is required" ( Behrins & Behrins, P.C. v Chan , 305 AD2d 348 [2d Dept 2003] ). A failure to abide by the court rules imposed upon attorneys in matrimonial cases will preclude the establishment of a charging lien, but not a retaining lien ( Hovanec v Hovanec , 79 AD3d 816, 817 [2d Dept 2010] ).
"A charging lien is a statutory security interest in the favorable result of litigation, giving the attorney equitable ownership interest in the client's cause of action and ensuring that the attorney can collect his fee from the fund he has created for that purpose on behalf of the client" pursuant to Judiciary Law section 475 ( Charnow v Charnow , 134 AD3d 875, 876 [2d Dept 2015], quoting Chadbourne & Parke, LLP v AB Recur Finans , 18 AD3d 222, 223 [1st Dept 2005] ; see also Wasserman v Wasserman , 119 AD3d 932, 933 [2d Dept 2014] ). In a matrimonial action, a charging lien will be available "to the extent that an equitable distribution award reflects the creation of a new fund by an attorney greater than the value of the interest already held by the client" ( Wasserman , 119 AD3d at 933, quoting Moody v Sorokina, 50 AD3d 1522, 1523 [4th Dept 2008] ).
In the instant matter, the issue of a retaining lien is moot as Defendant's file was already transferred from the Mazur Firm to Defendant's incoming counsel. Thus, this discussion will focus on the Mazur Firm's application for a charging lien.
The Mazur Firm asserts that, as a matter statutory authority and case law, it has an absolute right to a charging lien and that the Special Referee disregarded and misapprehended the law by referring the amount of the lien to a hearing at the conclusion of this divorce action. It posits that the law mandates that a charging lien for the full sum requested be granted without a hearing. In support of its application, the Mazur Firm cites to Dayan v Dayan (58 Misc 3d 957, 970 [Sup Ct, Kings County 2017, Sunshine, J.] ) for the proposition that a charging lien is one of three remedies available for the recovery of legal fees by an attorney discharged without cause.
In Dayan , former counsel sought both a retaining lien and a charging lien. The issue of the retaining lien was referred to a hearing to "determine plaintiff's counsel's appropriate fee and the posting of adequate security to satisfy the retaining lien" (id. at 965). With respect to the charging lien, the court stated, "any establishment of a charging lien must be delineated as an interim charging lien" which "would be subject to further adjustment once the case has been properly adjudicated and then a further hearing can be held to determine what role [outgoing counsel] had in obtaining the result achieved in equitable distribution" (id. at 969-970). The purpose of an interim charging lien, as stated by the court, is to prevent delay and give outgoing counsel "adequate security to extinguish the retaining lien" (id. at 970).
Here, in contrast, there is no need for an interim charging lien to serve as security because the Defendant's file has already been released. The Mazur Firm's application appears to be for a final charging lien in the sum of $168,507.21. As stated by the court in Dayan , where a divorce action is still pending and no final decision on equitable distribution has been made, "there is no ‘recovery’ for the charging lien to attach to," so any request for a final charging lien must be denied as premature (id. at 969). Thus, the Special Referee was correct in finding that the charging lien application was premature and should be denied without prejudice to renew.
Moreover, an issue of fact exists as to whether the Mazur Firm was discharged with or without cause. The mere fact that Defendant consented to a substitution of counsel is not dispositive on this issue if, as Defendant alleges, the Mazur Firm failed to send her regularly itemized bills and demanded a $100,000 trial retainer with one week's notice (see e.g. , Shalom Toy, Inc. v Each and Every One of the Members of the New York Prop. Ins. Underwriting Ass'n , 239 AD2d 196 [1st Dept 1997] [hearing is required to determine whether counsel was discharged for cause when former client alleges counsel commenced unnecessary litigation]; Katsaros v Katsaros, 152 AD2d 539 [2d Dept 1989] [hearing required where client alleged attorney engaged in spurious, unnecessary, and irrelevant motion practice]).
Furthermore, the Mazur Firm failed to make a prima facie showing that it substantially complied with the 60-day itemized billing requirement. Although the Mazur Firm alleges it sent at least 21 bills over the course of the three-year attorney-client relationship, their motions lack sufficient documentary proof to rebut Defendant's opposition (see Hovanec , 79 AD3d at 817 [affirming trial court's determination that attorney was not entitled to a charging lien for failing to make a prima facie showing of compliance with the 60-day billing requirement]). Despite the Mazur Firm's assertions, a hearing is necessary to determine first whether they were discharged with cause; second, whether a new fund was created as a result of the firm's efforts. Such hearing shall be held at the conclusion of trial or settlement.
In light of the foregoing, the Mazur Firm's application for a charging lien is denied without prejudice as premature. The Report is confirmed with respect to the charging lien to the extent stated herein.
CONCLUSION
IT IS HEREBY ORDERED that Defendant and the Mazur Firm's OSC filed on December 10, 2019 (motion sequence no. 8) is denied without prejudice; and it is further
ORDERED that the Mazur Firm's OSC filed on January 23, 2020 (motion sequence no. 10) is granted to the extent herein; and it is further
ORDERED that the Mazur Firm's application to be relieved is granted to the extent of the the consent to change attorney filed on February 26, 2020; and it is further
ORDERED that the Mazur Firm's application for a retaining lien is denied as moot; and it is further
ORDERED that the Mazur Firm's application for a charging lien is denied without prejudice; and it is further
ORDERED that Plaintiff's OSC filed on April 26, 2021 (motion sequence no. 14) is granted . The Report with Recommendations dated April 12, 2021 is confirmed to the extent indicated herein; and it is further
ORDERED that the Mazur Firm's cross motion filed on May 3, 2021 (motion sequence no. 15) is denied .
Any issue raised and not decided herein or by prior court order is denied.
Plaintiff shall serve a copy of this Decision and Order with notice of entry upon Defendant and the Mazur Firm within 10 days of such entry, and e-file an affidavit of said service.
This constitutes the order of the court.