Thursday, May 1, 2008

"No Good Deed Goes Unpunished"

So opines the Maryland Court of Appeals in characterizing the efforts of the circuit court in post-divorce "contentious and protracted litigation regarding...divorce and ancillary matters." A law firm had entered into an agreement with its client (the husband) to impose two liens on the client's interest in the marital home. The client was represented by independent counsel concerning the liens. The firm "established a priority right in the encumbered property with respect to third party creditors." The issue on appeal was whether the circuit court properly applied Maryland law "to prevent [the husband's] law firm from establishing priority in the proceeds from the sale of the marital home over the marital award granted to [the wife]."

The court concludes that "[i]rrespective of whether an injustice resulted from the imposition of liens against the proceeds of the marital home to satisfy [the husband's] legal fees or whether [the husband] retains other sources from which [the wife] may recover her monetary award, in the final analysis, because the trial court did not reduce the monetary award to a judgment, the [law] firm had priority to [his] interest in the proceeds. Bluntly put, the trial court, understandably so, felt that it had been stung because it had been for [the husband's] benefit that, with clear purpose and intent, it had not entered a money judgment [in favor of the law firm]. Consequently, given that the genesis of the controversy at the core of this appeal is the particular action of the trial judge, we take no position in this opinion on whether ethical boundaries were crossed. We leave the issue for another day and another fora." (Mike Frisch)

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