Court: Louisiana Court of Appeal; March 16, 1992; Louisiana; State Appellate Court
Academy Mortgage, Inc., a judgment creditor of Lee O. Pullen, appeals a trial court decision that recognized the lien of Morris Bart and Associates, the law firm representing Pullen in a personal injury case. The court concluded that Morris Bart's lien on the judgment awarded to Pullen was such that no funds were available for other creditors. Pullen was awarded $47,500 plus interest and costs from a jury verdict on May 25, 1989, following an auto accident in 1986. Academy sought to seize these proceeds to satisfy its own judgment against Pullen, leading Morris Bart to initiate a concursus proceeding on November 12, 1990, depositing $55,388.07 into the court’s Registry for determination of fund allocation.
Morris Bart argued that their fees and expenses exceeded the deposited amount, asserting their claims took precedence over Academy's. The trial court ruled in favor of Morris Bart on March 20, 1991, recognizing their lien under La.R.S. 9:5001, which grants attorneys a first privilege on judgments they obtain. The court found that Morris Bart's privilege was superior because Academy did not record its judgment until October 31, 1990, whereas Morris Bart’s privilege was established when the final judgment was rendered. Academy contended that rights were fixed by the May 25, 1989 judgment and cited a case to support that a judgment becomes final upon written rendition. However, the court determined the judgment only became final on October 5, 1990, when the Louisiana Supreme Court denied writs. The court applied the amended La.R.S. 9:5001, which clarified the definition of "professional fees," and Morris Bart argued that their lien became enforceable only after the judgment finalized and that the amendment should be retroactively effective.
The excerpt references the case Ardoin v. Hartford Accident & Indemnity Company, which establishes the principle of non-retroactivity of laws as articulated in Article 8 of the Louisiana Civil Code. This principle allows laws to apply only to future situations and prohibits laws from impairing existing contracts. However, three exceptions to this principle exist: laws that reduce penalties, interpretive laws that clarify existing legislation, and laws explicitly designated as retroactive.
Professor Yiannopoulos explains that interpretive laws do not create new rules but clarify the meaning of existing laws, allowing them to apply to actions that occurred before their enactment without violating non-retroactivity principles. Courts have upheld that interpretive legislation cannot divest vested rights since it reflects the original statute's meaning.
Morris Bart argues that a 1989 amendment to R.S. 9:5001 merely clarifies the definition of "professional fees" rather than creating new rights. In contrast, Academy contends the amendment is a substantive law intended to address a deficiency in prior law and should not apply retroactively without explicit legislative direction. Additionally, they assert that Louisiana law requires strict interpretation of liens and privileges in favor of those resisting such claims.
Despite Morris Bart’s compelling argument for interpretive application, the court concludes that the trial court did not apply the statute retroactively. It affirms that Morris Bart has a privilege on judgment proceeds related to a contingency contract, consistent with historical applications of R.S. 9:5001, which grants attorneys a first-rank privilege for fees on judgments and recovered property. The trial court's judgment is affirmed. Judge Plotkin concurs with written reasons.
