Samuel,

You need to tread carefully here; we all do.

Recent Supreme Court decisions state clearly that one may not pursue formal collection against a client while still representing that client.  It is deemed a "manufactured" conflict of interest, and is a per se ethics violation.

The first rule is, make the client a former client.  Ask for a signed Substitution of Attorney.  The client can get a new lawyer or substitute in pro se.  Failing that, file a motion to withdraw, not for non-payment but rather for non-responsiveness.  DO NOT file a request for a charging lien, as that is deemed no longer ethically permissible in this jurisdiction.

Once you have a signed and filed Substitution, then you must issue a Rule 1:20A-6 Pre-Action Notice to Client, which covers both "regular" fee arbitration and a Motion for Charging Lien.  There is nothing in the Rule about charging liens, but they are referenced in the comments.  If the former client fails to act timely (30 days), then call the Fee Arb Secretary in your vicinage to be sure it hasn't been filed without notice to you, and then either file suit or a motion to impose a charging lien, but be sure to include in your pleadings the fact that you have satisfied the Pre-Action Notice to Client rules.  Be sure to include a copy of the letter, plus a copy of the green card certified mail receipt as an exhibit. It is a condition precedent to filing a law suit or a motion to impose a charging lien. See R. 1:20A-6, last sentence.

The arbitration provision of the prior lawyer's retainer agreement is interesting.  There have been only a few reported cases in NJ about enforcement of such provisions.  I am leery of including them in our retainer agreements, because I am concerned that at some point, the Supreme Court or the Appellate Division will rule that those provisions represent overreaching in the context of attorneys and unsophisticated clients (don't all parties become unsophisticated once they are confronted with what's in the retainer agreement?).

Fee Arbitration IS arbitration.  I have generally had very good results in fee arbitration.  I think the Committees do a very good job of coordinating and ruling upon these cases, often encouraging negotiations between attorneys and former clients, but willing to call the question if necessary.

Mediation provisions in a retainer agreement are a different story.  They are not going to be deemed oppressive, and I believe they are enforceable, because no one is forced to settle; you either do or you don't.

Good luck with this matter.

Hanan

	Hanan M. Isaacs, Esq.   t 609.683.7400   f 609.921.8982 e [email protected]   w www.hananisaacs.com 4499 Route 27, Kingston NJ