The opinion of the court was delivered by: BIUNNO
Oroshnik filed complaint here to review the final decision of the Secretary of H.H.S. denying him retirement or old-age benefits under the Social Security Act for the year 1979. The review was under 42 U.S.C. § 405(g), and was successful. A judgment in favor of plaintiff was dated November 9, 1982, filed November 10, 1982, and entered November 12, 1982. It was silent in respect to either costs or attorneys fees.
Thereafter, the firm of Freeman & Bass, Esq. filed a notice of motion on June 10, 1983, addressed to the U.S. Attorney, for the allowance of attorney's fees. The motion was accompanied by copies of papers submitted to H.H.S. detailing the services rendered and time involved in representing claimant before the agency, correspondence indicating a request to HHS for attorneys fees and a statement of position indicating the amount of the past due benefits, that 25% of that amount had been retained, and that the application should be made to the court in the first instance. There was also an affidavit in respect to services rendered in the proceedings here. All of these papers, presumably, were intended to comply with the practice specified by the U.S. Court of Appeals in the exercise of its supervisory function, and recorded in cases such as Lindy etc. v. American Radiator, etc., 540 F.2d 102 (CA-3, 1976); Merola v. Atlantic, etc., 515 F.2d 165 (CA-3, 1976) and Hughes v. Repko, 578 F.2d 483 (CA-3, 1978).
The difficulties with the motion are manifold. The major difficulty is that by substitution dated August 31, 1982 and filed September 20, 1982, the firm of Freeman & Bass, Esqs. was replaced by the firm of Gluck & Tobin, Esqs. who made the presentation, and drafted the final judgment. Thus the first question is whether Freeman & Bass, Esqs. have any standing, i.e., can be recognized or heard, as the attorneys applying for the allowance of fees.
There can be only one attorney of record. This is true in all proceedings, civil or criminal, in both the State and Federal courts in this district. A party may have as many lawyers working on his case as he wishes, presumably so long as he is willing and able to pay them, or can stir them into championing his cause. They may do research, or interviews, or consultation, or drafting of documents, or serve any other function. But to handle the case in court, only one lawyer (or one firm of lawyers) may serve as attorney of record. Any other who appears in court to speak, whether to present argument, question witnesses or address jurors, can do so only on an "of counsel" basis to the attorney of record. This is fundamental.
Since the firm of Freeman & Bass, Esqs. is no longer the attorney of record in this case, they cannot make an application for the allowance of attorneys fees. The application for that purpose would need to be made on their behalf by the attorney of record.
Unlike the attorneys fees allowable under other statutes, such as 42 U.S.C. § 1988, or under the Equal Access to Justice Act, 28 U.S.C. § 2412(b), the fees authorized to be set by 42 U.S.C. § 406 are not amounts to be paid by the adversary in addition to the damages recovered under the judgment. Instead, the amounts set (subject to the maximum of 25% aggregate) are amounts authorized to be paid by the claimant/client to the lawyer out of the recovery of "past-due benefits to which the claimant is entitled by reason of such judgment."
The third difficulty is that the affidavit of the claimant/client out of whose past benefits the allowance (when authorized) is paid, opposes the allowance on the ground that he was dissatisfied with the services of Freeman & Bass, Esqs., and asked that Gluck & Tobin, Esqs. be substituted, which they were. This raises a question whether this court should make any allowance to the Freeman & Bass firm for representation before the court, to be paid out of the client's pocket.
There is also a second motion, returnable July 25, 1983, by the Gluck & Tobin firm seeking the allowance of attorneys fees for services rendered in representation before this court, supported by affidavit detailing the services and the time. By oral motion under Rule 7(b) (1), hearing on it was advanced so that both could be heard on July 11, 1983.
This application is not open to the three difficulties in the way of the Freeman & Bass motion. The applicant is the attorney of record, the application does not seek allowance for services except before this court, and the claimant/client is satisfied with the services and willing to have such fee as the court may set paid out of the recovery of past benefits (subject to the 25% maximum).
However, it faces other difficulties and these are common with further difficulties with the Freeman & Bass application.
The first of these is that the court has no information about the arrangements made with the claimant/client for compensation, subject to the statute, at the first engagement, or at the time of the substitution, or between the two law firms. In the typical case where attorneys fees are allowed (and to be paid in addition to any judgment) there are many different ways in which the presentation comes up. There may be one lawyer or law firm throughout but with more than one individual working on the case; or there may be an attorney of record rendering services as well as some other lawyer serving in another capacity in the litigation, and so on. Sometimes the allowance is made to one lawyer or firm who, in turn, allocates a proper portion to some other lawyer or firm in compliance with the Code of Professional Responsibility, see, especially DR-2-107. When the court is informed of the arrangement between the lawyers and with the party, it may make the allocation itself. In any case, those are matters usually dealing with amounts to be paid by someone other than the client and do not necessarily set the amount to be paid by the client in addition to the allowance to be paid (if at all) by the adversary.
Here, the statute controls the entire amount to be paid by the client, and limits payment in the aggregate to 25% of the past-due benefits recovered. ...