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Family Law Attorney’s Real Property Liens: Should You or Shouldn’t You?

Family Law Attorney’s Real Property Liens: 
Should You or Shouldn’t You?

The client must be given a reasonable opportunity to seek the advice of an independent lawyer and, thereafter, the client must consent in writing to the terms of the real property lien.

In a recent appellate case, the husband that was awarded the community real property residence in the judgment successfully moved to expunge the wife’s first attorney’s FLARPL from the property without joining the attorneys who filed the FLARPL. (In re Marriage of Turkanis and Price (2013) 213 Cal.App.4th 332, 349, 353, reh’g denied (Feb. 27, 2013), review denied (Apr. 17, 2013). The husband did, however, provide notice of his motion to the attorneys, thereby allowing for their appearance at the hearing.

The court held that once the lien validly attached to the real property pursuant to Family Code § 916, it did not automatically disappear when awarded to the non-encumbering spouse (citing Lezine v. Security Pacific Financial (1996) 14 Cal.4th 56, 73-74). Further, the court held that under Family Code § 2034(c), the trial court has jurisdiction to determine the propriety of a FLARPL at any time, even after it has been recorded. Family Code § 2034 governs the denial of FLARPLs.

FLARPLs appear to be easy to obtain for a family law practitioner, but they may require additional court hearings and there are no guarantees of payment.

The court found that because the wife’s attorney had complied with Family Code § 2033 and provided the husband with proper notice prior to the recordation of the FLARPL, the husband had consented to the lien as he did not object to it. The wife’s attorney attempted to raise the issues of waiver and estoppel on appeal, but the court refused to address those issues as they were not properly raised in the trial court.

While the court in In re Marriage of Turkanis and Price did not require the joinder of the attorneys who recorded the FLARPL, the Fourth District Court of Appeal did hold that an attorney who had recorded a FLARPL was an indispensable party to the non-encumbering spouse’s order to show cause for an order vacating the FLARPL, and thus joinder was required before her rights under the FLARPL could be adjudicated. (See In re Marriage of Ramirez (2011) 198 Cal.App.4th 336, 344, as modified (Aug. 22, 2011).)

In Ramirez, the parties had executed a marital settlement agreement, judgment was entered, and the encumbering spouse’s attorney filed a Notice of Withdrawal of Attorney of Record just one day shy of six months prior to the hearing on the order to show cause to remove the FLARPL.

While FLARPLs appear to be easy to obtain for a family law practitioner, they have the potential of requiring additional court hearings and are no guarantee that the lien will stay attached to the realty so that the attorney is guaranteed payment, especially if the realty is not awarded to the client. Another drawback of a FLARPL is that it has the potential to create a conflict between counsel and the client.

It is the attorney’s call to make as to whether or not to expend the time and energy to obtain a FLARPL or merely go about collecting fees and costs the traditional way. It seems that both methods have about the same success rate in recovering fees, especially if the realty is not awarded to the client.

 

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Tuesday, 01 December 2020

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