How to Lose a Charging Lien
Attorneys automatically obtain a charging lien by commencing an action. There are several ways to lose that lien. One is to be terminated "for cause" and another is to withdraw voluntarily. This is different from being "consented out" or by withdrawing with mutual consent. In Nassour v Lutheran Med. Ctr. ;2010 NY Slip Op 07906 ;Appellate Division, Second Department we see the difference:
"Pursuant to Judiciary Law § 475, "[w]hen an action is commenced, the attorney appearing for a party obtains a lien upon his or her client's causes of action . . . This lien attaches to any final order [*2]or settlement in the client's favor" (Matter of Wingate, Russotti & Shapiro, LLP v Friedman, Khafif & Assoc., 41 AD3d 367, 370). "Where an attorney's representation terminates upon mutual consent, and there has been no misconduct, no discharge for just cause, and no unjustified abandonment by the attorney, the attorney maintains his or her right to enforce the statutory lien" (Lansky v Easow, 304 AD2d 533, 534; see Klein v Eubank, 87 NY2d 459; cf. Matter of Winston, 214 AD2d 677). Where, however, an attorney withdraws without sufficient cause, his or her lien is automatically forfeited (see Hae Sook Moon v City of New York, 255 AD2d 292; Winters v Rise Steel Erection Corp., 231 AD2d 626). Here, Freedhand was not discharged by the plaintiff, but instead voluntarily withdrew. Since Freedhand failed to establish that there was just cause for his withdrawal, the Supreme Court should have vacated that portion of the judicial hearing officer's determination that Freedhand was entitled to a fee (cf. Robinson v Friedman Mgt. Corp., 49 AD3d 436; Winters v Rise Steel Erection Corp., 231 AD2d 626). "