On remand, the trial court, citing the COA’s decision, determined that it was required to hold both Hoffman and her attorney jointly and severally liable for the entire amount of $125,989.98. The Court of Appeals reasoned that, since it first remanded only with direction that the sum wrongfully awarded be paid back to Kasben, but did not address who should pay it, the trial court must have concluded that the COA order required it to hold the attorney liable since Hoffman authorized the money in escrow to be used to pay Kasben for representing her. In resolving the issue, the COA held that, by ordering the attorney to reimburse Kasben, the trial court was erroneously adjudicating the rights of a third party in a divorce proceeding. It further once Hoffman authorized the funds held for her benefit to be paid to her attorney, the attorney could no longer be charged with liability for those funds whether they were wrongfully awarded or not, absent a showing of fraud. Now when cases with fees in escrow are reversed and remanded, the appellee’s attorney won’t be left empty-handed.
Labels: Bankruptcy, divorce, Leelanau County, Michigan, trustee