Herzog v. Irace
Maine Supreme Judicial Court
594 A.2d 1106 (1991)
Gary Jones, injured in a motorcycle accident, hired Anthony Irace and Donald Lowry (Irace) (defendants) for his personal injury claim; while it was pending, Dr. John Herzog (plaintiff) treated Jones for an unrelated injury, and Jones, unable to pay, signed a letter stating Herzog should be paid from the settlement proceeds. Irace's office confirmed to Herzog that his services could be paid from those proceeds, and Herzog proceeded to treat Jones, including performing surgery, relying on that assurance. After Irace obtained a $20,000 settlement, Jones instructed Irace not to pay Herzog, saying he'd pay directly himself; Irace told Herzog that Jones had withdrawn permission and disbursed the funds to Jones and other creditors instead. Herzog sued Irace to enforce the assignment; both the district court and the intermediate appellate court ruled for Herzog, and Irace appealed.
Whether a client's letter clearly directing that a third party be paid from settlement proceeds constitutes an effective assignment enforceable directly against the client's attorney, even after the client later attempts to revoke that direction.