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Romero v. Earl5/1/1991
Ransom, Justice. [111 NM Page 789] Dr. Charles Romero, a chiropractor, sued attorney Richard Earl in metropolitan court for $2,339.82 pursuant to a "Doctor's Lien" against settlement proceeds in a worker's
compensation case. The instrument sued upon, signed by the worker, Jesus Rascon, and his attorney, Earl, authorized Romero to release to Earl medical information on Rascon's condition and directed Earl to pay from proceeds of the lawsuit directly to Romero whatever sums may be due and owing him for medical services rendered by reason of the accident. When Earl later received $5,000 in settlement proceeds, he paid the entire sum directly to Rascon upon the latter's instructions.
In response to Romero's complaint, Earl answered and asserted two affirmative defenses: (1) The contract sued upon was void for lack of consideration, and (2) the lien was illegal. The metropolitan court entered an order granting summary judgment in favor of Earl, and Romero appealed to the district court. On the record for review the district court reversed the decision of the metropolitan court and remanded the case for a hearing on its merits. Earl appeals, raising anew his affirmative defenses.
Obligor's duty to assignee. We agree with Romero that by virtue of the Doctor's Lien, Earl became obligated to distribute the proceeds of Rascon's claim in accordance with the writing, and that duty gave rise to an enforceable right in favor of Romero.
The writing was an assignment to Romero of Rascon's right to the proceeds of the award. See ) (language of assignment need not be formal, rather it need only manifest an intention on part of owner to transfer a right or interest in property); 4 A. Corbin, Corbin on Contracts 879 (1951) (same). Earl, as obligor with notice of the assignment, was required to pay the assignee. Id. 890. The obligor is liable to the assignee if the funds assigned subsequently are paid to the assignor in violation of the assignment. Bonanza Motors, Inc. v. Webb, 104 Idaho 234, 236, 657 P.2d 1102, 1104 (Ct. App. 1983).
Rascon's purported unilateral revocation of the assignment did not discharge
Earl's duty. As ably argued by Romero in his answer brief, once an attorney has accepted from his client an assignment of settlement proceeds to the client's creditor, the client, as assignor, cannot cancel or modify the assignment by unilateral action without the assent of the assignee, nor may he defeat the rights of the assignee. See (assignment of rights to child support ); Bonanza Motors, 104 Idaho at 236, 657 P.2d at 1104 (partial assignment of interest in funds to be received from a lawsuit against insurance company). Under such circumstances, a lawyer is not ethically bound to give the client more than the sum to which the client is entitled, nor is the client entitled to receive the funds promised to the creditor. Id.
Adequacy of consideration. Earl contends that his obligation to Romero was unsupported by consideration. Consideration adequate to support a promise is essential to enforcement of the contract and must be bargained for by the parties. . Something is bargained for "if it is sought by the promisor in exchange for his promise and is given by the promisee in exchange for that promise." Restatement (Second) of Contracts 71 (1979); see also Restatement (Second) of Contracts 79 (1979) (if the requirement of bargained for consideration is met, there is no further requirement of a benefit to the promisor or a detriment to the promisee).
We note that this is not a case in which an attorney i
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