Atlantic Savings Bank v. Hiler

Headnote

Surplus moneys—Buie 77—what claims constitute liens under —lien of attorney — power of court to protect.

The defendant Hiler, having recovered a judgment against one Stokes, commenced an action thereon, the defendant Fitch acting as his attorney, to have the same declared a lien on certain premises which, he alleged, were purchased with money belonging to Stokes, and recovered a judgment therein directing the sale of the said premises to satisfy his judgment. Subsequently the premises were sold under the foreclosure of a prior mortgage. Upon an application for the distribution of the surplus moneys, a reference was ordered to ascertain the amount due to Hiler and any other person which was a lien on such moneys.

Upon the hearing before the referee, the defendant Fitch claimed a portion of the moneys by virtue of his lien, as attorney, upon the judgment recovered against Stokes. Hiler did not object to his appearance, but opposed the allowance of the amount claimed by him. His claim was allowed by the referee, and from the order confirming the report this appeal was taken; the appellant insisting that Fitch had no right to appear'before the referee, and that his claim could not be allowed under Rule 77. Held. (1), that the order of reference authorized the appearance of Fitch, and that the error, if any, could only be corrected by an appeal from that order ; (2), that as no such objection had been made before the referee, it could not now prevail; (8), that as the whole proceeding was had by consent, even if it was not good as a reference, it was good as an arbitration between Hiler and Fitch to settle the amount due to the latter out of the money held by the judgment of Hiler; (4), that the court will not permit a party to take money out of its control without compensation to the attorney by whom it was obtained, and that even if Fitch had no such lien as to authorize him to file a notice under Rule 77, the court had power, for the protection of its officers, to direct the payment of his claim out of moneys controlled by it.

Appeal from an order of the Special Term confirming the report of a referee upon the distribution of the surplus moneys- arising from the sale of certain premises upon the foreclosure of a mortgage.