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Horn v. Horn

July 23, 2010


On appeal from Superior Court of New Jersey, Chancery Division, Family Part, Warren County, Docket No. FM-21-0040-02.

The opinion of the court was delivered by: Miniman, J.A.D.



Argued: December 16, 2009

Before Judges Payne, C.L. Miniman, and Waugh.

Plaintiff Timothy B. Van Horn appeals from ¶ 6 of a June 29, 2007, order on his motion to enforce litigant's rights that disqualified his attorney and from ¶¶ 1 and 2 of a July 20, 2007, order denying reconsideration of the disqualification and denying a stay of same. Defendant Lisa Van Horn cross-appeals from ¶¶ 1 and 2 of the June 29, 2007, order, which required her to pay $17,140 to plaintiff plus counsel fees and from ¶ 3 of the July 20, 2007, order denying her application for counsel fees on defendant's motion for reconsideration.

We affirm ¶¶ 1 and 2 of the June 29, 2007, and ¶ 3 of the July 20, 2007 order. However, we reverse ¶ 6 of the June 29, 2007, order and ¶¶ 1 and 2 of the July 20, 2007, order because we conclude that disqualification of plaintiff's attorney was not an available remedy for violation of Rule 5:3-5(b), which prohibits an attorney from taking a mortgage to secure payment of attorney's fees while the matter is unresolved and the attorney represents the mortgagor-client. We also conclude that the evidence was insufficient to support a finding that the attorney violated R.P.C. 1.8.


The parties were married on August 2, 1980. Three children were born of the marriage: a son in 1980, a daughter in 1982, and another daughter in 1985. Van Horn v. Van Horn, No. A-3813-05 (App. Div. July 14, 2008) (slip op. at 2). Plaintiff filed for divorce on November 21, 2001. Id. at 5. The judge dissolved their marriage in a Dual Judgment of Divorce (JOD) entered on June 30, 2005, after a lengthy trial.

An Amended JOD was entered on December 9, 2005, resolving the parties' claims to alimony, equitable distribution, child support, and other issues. Both parties' requests for counsel fees were denied. Defendant appealed and plaintiff cross-appealed from the Amended Dual JOD. Id. at 1-2. We affirmed in all respects. Id. at 2.

From May 19, 2003, until June 29, 2007, plaintiff's counsel, Patricia Garity Smits, represented plaintiff pursuant to a matrimonial retainer agreement signed by plaintiff and Smits. The agreement required plaintiff to pay a $7500 retainer of which $2500 was to be reserved for application to the final bill. No additional retainers or monthly payments were required. The billing rate for Smits was $325 per hour. Plaintiff acknowledged that he was responsible to pay the bill in full even if defendant was ordered to contribute to his counsel fees, unless defendant actually made a payment. Plaintiff also agreed to pay interest of one percent per month on overdue amounts.

On December 27, 2005, Smits filed a notice of motion in aid of litigant's rights and for reconsideration of the portion of the Amended JOD that denied plaintiff's application for counsel fees. Plaintiff sought payment of child support, counsel fees on the motion, reconsideration of the divorce judgment, and other relief. Smits filed a certification in support of the reconsideration application. Defendant cross-moved for various forms of relief.

While this motion was pending, plaintiff executed a mortgage in favor of Smits on February 13, 2006. In the mortgage document, plaintiff stated: "In return for legal fees that I owe, I promise to pay Two Hundred Fifty Thousand and 00/100 Dollars ($250,000.00) . . . in accordance with the terms of a Mortgage Note dated February 13, 2006." The mortgaged property was plaintiff's home in Harmony.

On March 10, 2006, the judge issued four orders on plaintiff's December 27, 2005, motion and on defendant's cross-motion. One order instructed defendant to pay plaintiff $7140 plus interest for unpaid child support, required defendant to sign the authorization to transfer the PNC Investments Account to plaintiff, required immediate transfer of that account, defined the term "African bonds," and denied all other relief sought. The second order denied defendant's cross-motion for reconsideration of the Amended JOD and denied plaintiff's cross-motion for counsel fees in opposing that motion. The third order denied defendant's motion for a stay of certain portions of the Amended JOD pending appeal. The fourth order denied defendant's motion for reconsideration of the Amended JOD.

On March 30, 2006, defendant filed a notice of appeal from the Amended JOD and the March 10, 2006, orders. Plaintiff filed a cross-appeal on April 24, 2006, with Smits representing plaintiff as counsel of record.

While this appeal was pending, plaintiff, represented by Smits, filed another motion in aid of litigant's rights on February 7, 2007, seeking a judgment for the $7140 in unpaid child support, a judgment for $10,000 for unpaid equitable distribution, and other relief, including sanctions, payment of child support through the Probation Department, and counsel fees. Defendant cross-moved requesting a stay of plaintiff's motion pending the outcome of the previously filed appeal and seeking an order disqualifying Smits from further representing plaintiff in the case.

Plaintiff opposed the cross-motion, certifying that he wished to have Smits continue to represent him and contending that the disqualification motion was just one more threat and harassment by defendant's attorney. He asserted, "The mortgage has nothing to do with the request that [defendant] be required to pay fees that I wouldn't have except for her refusal to comply with the Amended [JOD]." Smits also filed an opposing certification. She urged that, with the appeal pending, the judge had no jurisdiction to decide the disqualification cross-motion. She also asserted that she was in full compliance with Rule 5:3-5(b) and there was no basis for a disqualification.

The judge heard the parties' arguments on March 23, 2007, and reserved decision. On June 29, 2007, the judge enforced the Amended JOD and ordered defendant to pay $17,140, awarded counsel fees to plaintiff, disqualified Smits, and denied all other relief. The judge found that on February 21, 2006, a mortgage was recorded in which [plaintiff] gave his current attorney a mortgage on his home. [Plaintiff's] attorney was, as of February 21, 2006, and still is representing [plaintiff].

R. 5:3-5(b) states in pertinent part, as follows:

During the period of the representation, an attorney shall not take or hold a security interest, mortgage, or other lien on the client's property interests to assure payment of the fee. This Rule shall not, however, prohibit an attorney from taking a security interest in the property of a former client after the conclusion of the matter for which the attorney was retained, provided the requirements of R.P.C. 1.8(a) have been satisfied. Inasmuch ...

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