Sutherland v. Sutherland, C.A. No. 2399-VCN (Del. Ch. Feb. 27, 2015). This Chancery letter ruling should be of interest to all lawyers to the extent that it permitted a law firm to intervene in a case in order to assert a “charging lien” to allow it to collect attorneys’ fees that it incurred in excess of $760,000 for work previously done on the case. Prior Delaware cases have recognized the right to a charging lien by an attorney as a basis for the attorney to collect fees, but this is the first Delaware decision that has allowed a law firm to intervene under Court of Chancery Rule 24 as a means of securing payment for work that it had previously done in corporate litigation.
Many prior decisions in this long running litigation between these parties have been highlighted on this blog, and they can be searched by inserting the case name in the search box in the right margin, but suffice it for these purposes to say that this matter competes for one of the longest running internecine battles involving complicated issues of corporate law in connection with a family owned business in which there were challenges to control and challenges to the manner in which the part of the family that was managing the company was running it.
The law firm that filed the motion to intervene for purposes of asserting an attorney charging lien, Katten Muchin Rosenman, LLP, cannot likely expect full payment for its lien because the amount of the lien for unpaid fees is over $760,000, but the amount of fees awarded to the plaintiff in this case is only $275,000.