Attorney Liens May Be Resolved Against Client and Competing Counsel in One Action

A recent California Court of Appeal decision addresses a recurring procedural issue in contingent-fee litigation: how attorneys enforce competing liens against settlement proceeds. In Jacobs v. Papez (2026), the Third District held that an attorney may pursue a single declaratory relief action against both the client and a competing attorney, without first litigating the lien solely against the client.

For attorneys handling contingent-fee matters, the decision provides a clear procedural roadmap for resolving lien disputes efficiently. When multiple lawyers claim an interest in the same recovery, those competing claims may be resolved in a single proceeding, so long as all necessary parties are before the court.

How the Multi-Attorney Dispute Developed

The case arose from a personal injury action involving a 2017 car accident near Lake Tahoe. Over the course of the litigation, the plaintiffs were represented by multiple attorneys at different stages, setting the stage for competing lien claims after settlement.

• Initial Counsel: Handled the early stages of the case but did not file a complaint before being discharged
• Successor Counsel: Filed the lawsuit, asserted a $60,000 attorney lien, and later withdrew from representation
• Final Counsel: Took over the case, entered into a 40% contingency agreement, and claimed a first-position lien on any recovery

The matter ultimately settled for $200,000. However, because multiple attorneys asserted liens, a portion of the recovery was withheld pending resolution of those claims.

Settlement Leads to Allocation Dispute Among Counsel

After settlement, the insurer held back approximately $67,000 while the competing lien claims were addressed.

Initial Counsel agreed to accept a reduced payment and was paid from the withheld funds. The remaining dispute centered on the competing claims between Successor Counsel and Final Counsel.

Rather than proceeding through separate actions, Final Counsel filed a declaratory relief action against both the clients and Successor Counsel to determine entitlement to the remaining funds.

Trial Court Limits Lien Enforcement to Separate Proceedings

The trial court dismissed the action. It concluded that Final Counsel could not litigate competing lien claims in a single suit and that Successor Counsel’s lien had to be adjudicated first in a separate action before Final Counsel’s lien could be determined.

In the court’s view, lien enforcement had to proceed sequentially, with each attorney establishing their rights independently rather than in a consolidated proceeding.

Court of Appeal Rejects Fragmented Lien Litigation

The Court of Appeal reversed.

Justice Aimee A. Feinberg explained that although attorney liens must be enforced through a separate action distinct from the underlying case, California law does not require those disputes to be resolved through multiple, sequential lawsuits.

Instead, the court held that a declaratory relief action may be brought against both the client and a competing attorney lien claimant, allowing the court to resolve:

• The client (to establish lien validity and amount)
• Any competing lien claims

Relying in part on Brown v. Superior Court (2004), the court confirmed that when all interested parties are joined, the court may determine the validity, amount, and priority of competing liens in a single proceeding.

The Rule: One Action Can Resolve All Lien Claims

The decision clarifies the proper framework for attorney lien enforcement:

• A separate action is still required to enforce an attorney lien (separate from the underlying case)
• That action may include all relevant parties at once
• Courts are not required to resolve lien disputes through multiple, sequential lawsuits

Including the client ensures the court can adjudicate the contractual basis of the lien, while allowing competing counsel to litigate priority and entitlement in the same proceeding.

Practical Impact on Multi-Attorney Litigation

Fee disputes between multiple attorneys are common in personal injury litigation, particularly when cases change hands before resolution.

This decision provides practical guidance:

• Competing lien claims may be resolved more efficiently in one action
• Attorneys are not required to wait for another lienholder to litigate first
• Declaratory relief provides a streamlined path to determine entitlement to settlement proceeds

For practitioners, the ruling reduces procedural uncertainty and helps avoid delays in distributing funds. This is particularly important in high-value cases where delayed distribution can impact both client recovery and attorney compensation.

Final Takeaway: Consolidated Lien Enforcement Is Permitted

When multiple attorneys assert liens against the same recovery, California courts permit these disputes to be resolved in a single declaratory relief action, so long as the client is included.

This approach allows courts to determine lien validity, amount, and priority in one proceeding, rather than through fragmented litigation.

For catastrophic personal injury cases that call for experienced trial counsel from intake through resolution, we welcome the opportunity to work with you.

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