Linder v. Lewis, Roca, Scoville & Beauchamp
In Linder v. Lewis, Roca, Scoville & Beauchamp, 85 Ariz. 118, 123, 333 P.2d 286, 289 (1958), a client hired a law firm to file a tort action and agreed to pay the firm a contingency fee of one-third of any judgment obtained against the tortfeasor. Id.
The law firm obtained a judgment, and the client subsequently assigned his rights in the judgment to a third party. Id. at 121, 333 P.2d at 288.
When the third party attempted to collect the judgment, the law firm intervened to obtain payment of its attorneys' fees from the judgment before it was paid to the third party. Id. at 121-22, 333 P.2d at 288-89.
The issue on appeal was whether the law firm's right to obtain payment of its fees from the judgment was superior to the third party's right in the judgment. Id. at 123, 333 P.2d at 289.
The Court found that the client had relied on the judgment itself to fund payment of the attorneys' fees, thereby creating a "charging lien" against the judgment; therefore, the client could not assign that portion of the judgment necessary to pay the attorneys' fees:
Where an attorney has a charging lien against a fund, a portion to the amount of his claim belongs to the attorney and cannot be assigned by the judgment creditor, and whoever receives it under an assignment is, in justice, to be considered as holding to the attorneys' use and benefit. Id.