When is a statutory attorney's lien wrongful under Utah's Wrongful Lien Act? Estate of Carey v. Spencer Explained

Background and facts

James Gibbons retained attorney Terry Spencer and his firm TRSpencer & Associates to handle probate proceedings following the death of his partner, Doreen Jo Carey. The probate court appointed Gibbons as personal representative of Doreen’s estate. Before Gibbons was later removed for cause, TRSpencer recorded an attorney’s lien of approximately $98,742 on real property held by the Estate. The successor personal representative filed a motion in the probate court to declare the lien wrongful, but that motion was denied. The Estate then filed a separate district court action, and the district court ultimately granted judgment on the pleadings in favor of the Estate on its wrongful lien claim, awarding $10,000 in statutory damages and over $16,000 in attorney fees. TRSpencer appealed.

Key legal issues

Three issues dominated the appeal. First, whether the Estate had standing — or more precisely, capacity to sue — to bring the district court action. Second, whether issue preclusion barred the district court from independently ruling on the wrongful lien claim given the probate court’s earlier denial. Third, whether TRSpencer’s attorney’s lien was wrongful as a matter of law under the Wrongful Lien Act, Utah Code section 38-9-102(12).

Court’s analysis and holding

The court first held that TRSpencer’s jurisdictional challenge was actually an unpreserved argument about capacity to sue, not standing. Drawing on Estate of Faucheaux v. City of Provo, 2019 UT 41, the court distinguished standing — which turns on whether a party is personally aggrieved — from capacity, which concerns legal authority to act. Because an estate can be personally aggrieved by injuries flowing from a wrongful lien on its property, and because TRSpencer’s capacity argument was never raised in the district court, the court declined to address it.

On issue preclusion, the court held that the fourth element — a final judgment on the merits — was not satisfied. Without a transcript of the probate court hearing or a written order, the court could not determine whether Judge Pettit’s denial was on the merits or on procedural grounds. The court also rejected TRSpencer’s unpreserved arguments based on the probate court’s exclusive authority and principles of comity.

On the wrongful lien question, the court applied Hutter v. Dig-It, Inc., 2009 UT 69, and Bay Harbor Farm, LC v. Sumsion, 2014 UT App 133, to hold that a statutorily authorized lien is not wrongful under the Act unless the claimant lacked a good-faith basis for claiming it. Because TRSpencer pleaded that its client — Gibbons acting as personal representative — held title to the Estate’s property under Utah Code section 75-3-710, TRSpencer alleged a sufficiently plausible good-faith claim to survive judgment on the pleadings. The court reversed the order and vacated the associated judgment.

Practice implications

Practitioners should recognize that the Wrongful Lien Act is not a vehicle for litigating lien enforceability — an unenforceable lien is not automatically wrongful. The operative question is whether the claimant had a good-faith basis for asserting the lien at all. Attorneys liening estate property through a personal representative client should expressly plead the client’s representative capacity and statutory authority over the property. Conversely, parties challenging capacity to sue must raise that defense in the district court or forfeit it — unlike standing, capacity is not jurisdictional and is subject to waiver under Utah procedural rules.