138 Mo. 140 | Mo. | 1897
This case is here on cross appeals.
The Merchants’ Exchange of St. Louis is a corporation organized under act of March 4, 1863, amended by act of February 2, 1865, and February 12, 1875, whereby was incorporated a theretofore existing voluntary association. The corporation thus created had no capital Stock and about three thousand
“We, the members of the Merchants’ Exchange of St. Louis, having a desire to advance and promote the commercial and manufacturing interests of the city of St. Louis, and wishing to inculcate just and equitable principles of trade, establish and maintain uniformity in the commercial usages of the city; acquire, preserve and disseminate valuable business information; and with a view to avoid and adjust, as far as practicable, the controversies and misunderstandings which may arise between individuals engaged in trade when they have no acknowledged rules to guide them, do hereby agree to be governed by the following rules, regulations and by-laws.”
The charter of the Exchange as amended by the act of February 12, 1875, provided as follows:
“Section 2.- The rules, regulations and by-laws of the said association shall be the rules, regulations and by-laws of the corporation hereby created until the same shall be regularly repealed or altered in the mode herein provided; and the present officers of said association shall be the officers of this corporation until, by the terms of said rules, regulations and bylaws, their respective offices shall expire or be vacated, and the board of directors of said association shall have' power to suspend or expel any member of said Exchange for misconduct or for violation of the rules, regulations or by-laws, or for other causes specified in said rules.
The government of the Exchange was vested by its rules in a board of thirteen (13) directors, including the president and two vice-presidents. Section 8 or rule 4 provides, as follows:
“Section 8. The directors shall cause to be provided suitable reading and exchange rooms for meet*149 ings of members, which shall be kept open during usual business hours; they shall have control over such rooms, and may establish and enforce such rules and regulations in regard to the use of the same as may seem proper; provided, however, that from 11 o'clock a. m. to 1 o’clock p. m. daily the same shall be set apart and applied for the general meeting for the transaction of business.”
The rules also provided, rule 4, section 9, a method of procedure against any member charged with, misconduct or violation of any of the rules, regulations or by-laws, or other act specified in the rules:
“Section 9. It shall be the duty of the board of directors to examine, charges preferred against any member of the Exchange, when made to the board in writing by a member of the Exchange, and to examine into the misconduct of any member in any way coming to their knowledge; and when any member shall be' found guilty of a violation of any rule, regulation or by-law of the Exchange, or shall have failed or refused to comply with or fulfill the award of the committee of arbitration, of the committee of appeals, or of any properly constituted committee of the Exchange; or shall .be found guilty of failing to comply promptly with the terms of any business contract or obligation, or of failing to equitably adjust and settle the same; or if any member shall be found guilty of refusing or neglecting to pay for property sold for cash on the delivery of the same; or when any member shall be found guilty of obtaining property upon false representation, or when any member shall be found guilty of making false or fictitious reports of sales or purchases ; or when any member shall be found guilty of any act or bad faith or of any act of a criminal nature, or when any member shall be found guilty of giving false weight of flour, cornmeal, provisions, or any*150 other article, or of false packing, or of changing an original package with intent to defraud, such offending member shall be censured, suspended or expelled by the board of directors, and for disorderly or improper conduct in any of the rooms of the Exchange, may be fined, censured, suspended, or expelled, as they may determine. A majority of a quorum of the board of directors shall be necessary to fine, censure or suspend a member; and an affirmative vote of at least ten members of the board shall be necessary to expel. No member, however, shall be censured, suspended or expelled without having an opportunity of being heard in his defense; and any member charged with a violation of the rules of the Exchange, or with any of the offenses enumerated in this section, shall be notified in writing of the nature of such charges, and at the time at which such charges will be investigated by the board, at least five days before the day of trial.
“In investigations before the board of directors, either party shall be allowed to be represented by a member of the Exchange, either as professional counsel or as a friend. Any member suspended may be reinstated by a majority vote of a quorum of the board of directors; * * *”
Under article 8 of the by-laws, smoking in the Exchange room between the hours of 11 a. m. and 1 p. m. was prohibited.
Under rule 16 it was provided that the rules could not be rescinded or altered without a two-thirds vote at a meeting of the members of the Exchange.
In September, 1888, the board of directors abolished the afternoon session of the Exchange and extended the morning session, which had theretofore closed at 1 o’clock to 1:15 p. m., and at the same time directed that there should be no smoking on the floor between 1 o’clock and 1:15.
The president of the board at that time, Mr. Charles F. Orthwein, testified:
“After the change was made, Mr. Albers came to me on ’Change and told me he thought the board had no right to make such a change of the rule forbidding smoking; that he would not recognize the right of the board, and ,h© would not obey the rule; I told him that the board thought differently; that the board thought they had the right, and that they were acting under legal advice, and that he had better not violate the rule; and if he did he would have to take the consequences ; he said that was just what he wanted; he wanted to bring the matter into court to see what rights he had in the matter; he said he wanted to take the matter to court. * *
“Yes, he said he would fight us, and fight the board; he said he would bring the matter, if necessary, into court.”
Accordingly Mr. Albers publicly challenged the authority of the board of directors and the regulation made by them,' by smoking on ’Change between 1 o’clock and 1:15?. m., during public session; smoking, as he says, in plain sight of anyone that was there. Mr. Orthwein testifies that for the next few days he smoked continually after 1 o’clock. “I saw him, myself, smoking; he was reported by the floor committee to the secretary; I have seen him myself; for three or four days we took no notice of it, because we thought he would quiet down about the matter and abstain
He also went into the secretary’s office and called his attention to the fact that he was smoking; wanted the officers of the Exchange to see what he was doing.
Written complaint was thereupon made by the floor manager against Mr. Albers; and he was thereupon cited to show cause before the board of directors, to answer the' charge of disorderly conduct. He appeared and filed his written answer, admitting that he had smoked between 1 and 1:15, but claimed that he had a right to do so under the rules, and denied the validity of the regulation made by the board of directors. The board being advised by their counsel, whom they consulted, that their regulation prohibiting smoking between 1 o’clock and 1:15 was valid, found Mr. Albers guilty of disorderly conduct and fined him therefor the sum of $50, to be paid within five days from date.
Mr. Albers refused to pay the fine, claiming that it was illegal, and thereupon he was summoned to show cause why he should not be suspended for refusal to comply with the order of the board of directors. After due notice this matter was taken up by the board, and Mr. Albers persisting in his refusal, he was ordered, suspended from membership. This action was taken on the afternoon of November 8, 1888, after the daily session. Mr. Albers was present when the order was made. On the next day Mr. Albers was excluded from the floor in accordance with this order of suspension, but he sued out an injunction in the St. Louis circuit court against the board restraining them from enforc
Meantime the suit proceeded in the circuit court, and the circuit court judge, Klein, granted a permanent injunction, from which an appeal was had to the court of appeals, where the judgment was affirmed (see 39 Mo. App. 583). Both the circuit court and the court of appeals held that the board of directors was authorized to change the hours of daily session and to make the smoking rule, and that Mr. Albers was properly-subjected to corporate discipline for violation of that rule, but that the imposition of a fine was invalid because there was no limit upon the amount of the fine in the rule, and that the collection of a fine could not be enforced by suspension.
Plaintiff thereupon brought the present suit in the St. Louis circuit court against the -Exchange and the individual directors who constituted the board at the time of his suspension, charging that defendants had acted, not only in excess of their authority and in violation of law, but in so doing they had “acted recklessly, willfully, and maliciously, and with design to injure and oppress plaintiff,” alleged great pecuniary loss and damage and expenses by way of counsel fees, and asked damages in the sum of $50,000 against the corporation and the individual members of the board.
The answer of defendant set out the facts above set forth as to the nature of the corporation, circumstances attending the suspension; that the resolution of suspension was drafted by their counsel and adopted by them in good faith in the performance of their duties under the rules of the Exchange, without malice in any form, and that the suspension was held invalid by the
It appeared from plaintiff’s testimony that he was a grain speculator, buying and selling grain for future delivery for himself as well as for his customers, the largest part of his business being speculating on his own account, He had an assistant, a member of the Exchange, who filled orders on the Exchange that were received from other parties, and this class of business was not interfered with by his one day’s suspension. During the business hours of the day of his suspension he spent part of the time in the hall adjoining the Exchange room, but did not attempt to make any trades for himself through other brokers. He admitted that if he had succeeded in making these speculations on that day he might have made money and might have lost. There was no evidence of any business loss in consequence of his suspension, and the only evidence of expenses was that of the payment of $500 to his attorney for all the legal services connected with the injunction proceeding, which included the arguments both in the circuit court and the court of appeals against the validity of the smoking rule as well as .against the regularity of the procedure before the board of directors. Plaintiff also testified that he felt “humiliated” by the suspension and that it was a matter of common report. There was no evidence of assault by the doorkeeper in excluding Mr. Albers from the Exchange.
There was no evidence of any malicious or corrupt action or intention on the part of the members of the board of directors. On the contrary, several of the individual defendants, Messrs. Ohas. F. Orthwein, then president of the Exchange; Mr. W. T. Anderson and
It appearing that the counsel of the Exchange, under whose advice the directors acted, was one of the three thousand members of the Exchange, objection was made by counsel for plaintiff on the ground that he was interested in the subject-matter, which was overruled by the court.
Defendant asked the court to direct a verdict for defendant and also for the following instruction:
“The court instructs the jurors that under the charter of the Merchants’ Exchange, the board of directors had the power to try members for misconduct and to suspend or expel members whom they found guilty thereof, and if the jurors believe from the evidence that the said board consulted with counsel and communicated all the facts within their knowledge to him, and were advised by said counsel that the refusal by plaintiff to pay the fine which had theretofore been imposed on him constituted misconduct for which said board was authorized under its charter to suspend him, and that said board in the performance of what they believed to be their duty, acted upon the advice of said counsel in good faith, and without malice, in suspending plaintiff, then the jurors must find for the defendants.”
The court refused to .direct a verdict for defendant
“1. The court declares the law to be that the board of directors of the Merchants’ Exchange had no authority to suspend Albers for non-payment of the fine imposed upon him; that their resolution of sentence suspending him from membership therein was absolutely void for want of jurisdiction, and in enforcing said sentence and depriving plaintiff of his right of access to the floor of the Exchange, defendants became wrongdoers, and the jury are therefore instructed to return a verdict in favor of plaintiff.
“2. The jury are instructed that so far as this case is concerned, it is immaterial whether Albers in his contention with the board of directors as to their authority to change the rule relative to smoking in the Exchange hall was right or wrong; even though the directors in that particular were right and Albers wrong, and even though, instead of fining they might have suspended him as for a violation of said rule, still, such facts constitute no defense to this action.
“3. In returning a verdict for the plaintiff the jury will estimate his damages as follows: First. They will allow him such reasonable sum as it may appear from the evidence that he was required to pay counsel in order to obtain and maintain the injunction annulling his suspension and restoring to him his rights as a member of the Merchants’ Exchange. Second. They will allow him such sum as they may find will fairly compensate him for such shame and humiliation as may appear from the evidence resulted from said legal suspension. Third. If the jury believe from the evidence that the action of the directors of the Merchants’ Exchange in suspending him was malicious, then the jury may add to the damages above indicated such sum (the aggregate not exceeding the amount claimed*157 in the petition) as the jury may believe from the evidence, taking into consideration defendants’ ability to pay, will be sufficient to punish defendants for thus suspending plaintiff. •
“4. It is not necessary 'to show malice by direct testimony; it may be inferred from facts and circumstances in evidence indicating the same.
“5. The jury are instructed that malice, as used in these instructions, means the intentional doing of a wrongful act without just cause or excuse. It is not necessary to constitute malice as here mentioned, that the defendants should have had any spite or ill will toward plaintiff.”
The court gave the following instruction of its own motion:
“Upon the undisputed facts of this case as shown by the pleadings and evidence your verdict should be for the plaintiff. But there is no evidence before you that would justify you in concluding that the action of the board of directors in suspending the plaintiff from membership in defendant corporation was actuated by malice, and therefore you would not be justified in awarding the plaintiff exemplary or punitive damages ; and since, in a case of this kind,, attorney’s fees expended, as mentioned in the evidence, and injury to feelings can be taken into account only in estimating exemplary or punitive damages, you would not be justified in taking into consideration, in estimating the plaintiff’s damages, the amount expended by him' for attorney’s fees in the injunction case mentioned in the evidence, or injury, if any, to his feelings; but in assessing the plaintiff’s damages the inquiry is limited to the actual pecuniary loss in his business consequent on the suspension, and since there is no evidence of any actual, substantial loss in that particular, you can award the plaintiff only nominal damages. Yon are*158 therefore instructed to return a verdict for the plaintiff and assess his damages at 1 cent.”
I. It is perfectly obvious that, notwithstanding the allegations of pecuniary loss and damage from being deprived of his right to buy and sell on ’Change and his loss of credit, the pith of this case in the estimation of plaintiff and his counsel is the allegation “that the acts and conduct of the defendants, the directors of the Exchange, in suspending plaintiff was not only in excess of their authority and in violation of law, but in so doing they acted recklessly, willfully, and maliciously, and with a design to oppress, disgrace, and injure plaintiff.” We say it is apparent that the theory of plaintiff in drawing the petition and in the presentation of evidence on the trial was that he was entitled to exemplary or punitive damages.
At any rate, he utterly failed to show any pecuniary loss in consequence of his one day’s suspension. He had an assistant, also a member of the Exchange, who filled orders on the Exchange for outside parties, as usual, on the ninth day of November, so that this class of his business was not molested for a moment during the day he was suspended.
As to his individual speculations, plaintiff testified he could make no estimate of any loss he suffered by not being on Exchange that day. He might have made money and he might have lost. He sometimes lost.
The only item of expense he could name was the payment of an attorney’s fee of $500 for all of the legal services rendered him in the injunction proceeding, both in the circuit court and court of appeals.
Did the circuit court err in holding that plaintiff was not entitled to recover back this fee because there was no evidence that the directors were actuated by malice in suspending plaintiff from membership, and
It is certainly desirable that we should have definite and well defined rules as to the elements and measure of damages. The amount a party is to recover for a legal wrong ought not to be left to the caprice of a jury when his damages can be estimated according to definite rules of law. Compensation for actual loss is the professed object of the law, except when there has been fraud, oppression, or malice. In these latter cases the jury are allowed to give punitive or exemplary damages.
In Missouri, taxable costs are fixed by statute and do not include attorney’s fees. There are a few exceptions to this general rule,, made so by particular statutes as in partition cases, but these exceptions simply emphasize the general doctrine and policy of the State.
The law of this State in denying a party the right to recover from his adversary the expenses of litigation other than statutory taxable costs is in harmony with the law of our sister States throughout the Union. Nowhere have we found it more tersely stated than by the supreme court of Arkansas in McDaniel v. Crabtree, 21 Ark. 431, in which that court sums up the rule and its exceptions in these words:
“Questions may arise between principal and surety, between parties to covenants in deeds, in actions for an oppressive and illegal use of extraordinary legal remedies, in malicious arid fraudulent suits, and in admiralty cases, in which the assessing tribunal, in the exercise of its power of visiting the wrongdoer with exemplary damages, may include counsel fees in their estimate; yet it is not the less the general rule that a suitor must himself, and without compensation, bear the burden of charges for legal advice and defense of his suit.” Brown v. Cape Girardeau, 90 Mo. 377; Waters
The obligation to pay the attorney’s fee in that case did not arise out of the fact that the ward was successful in his suit against his curator, but the liability was determined by the terms of the curator’s bond which, it was properly held, stood good as an indemnity against all the natural and proximate consequences of a breach of the duty which the curator owed the ward. The liability in such ease flows from the breach of a contractual obligation.
An exhaustive collection of the cases will be found in 1 Sutherland on Damages [2 Ed.], in note 1 to section 85, page 179.
It must be held that defendants are not liable for plaintiff’s attorney’s fees unless there was evidence of malice in their action in suspending him from the privileges of the floor.
II. To maintain this action on the ground of malice it devolved upon plaintiff to prove that the defendants prosecuted the proceedings which terminated in the imposition of the fine and suspension of plaintiff from the privileges of the Exchange without probable cause, that is to say, that at the time of instituting and carrying on these proceedings by defendants, there were no facts or circumstances sufficiently strong in themselves to induce defendants, as reasonable and cautious men, to believe that plaintiff’had knowingly violated a valid and reasonable rule or by-law of said Exchange, and that they, as directors, had the power to impose said fine and enforce it by suspension of plaintiff from the privileges of said Exchange, and that in so doing, they
The learned trial court instructed the jury that there was no evidence that the action of the board-was actuated by malice, and in so doing it was abundantly justified by the record. On the contrary, the evidence shows that plaintiff was responsible for all the consequences that ensued. He defiantly assumed the prerogative of nullifying a most reasonable and proper regulation made by the board prohibiting smoking on the floor of the Exchange during business hours. It is somewhat difficult to conceive what inspired plaintiff to assume the position he did with reference to this rule. He had voluntarily become a member of the Exchange when the by-laws prescribed the business hours should be from 11 a, m. to 1p.m., each day, and that smoking was prohibited during that time. When it was deemed best to lengthen the business session fifteen minutes the rule as to smoking was also altered so as to prohibit it during the additional fifteen minutes. No complaint appears to have been made that the old rule as to smoking had been deemed oppressive, but the idea of extending the prohibition fifteen minutes seems to have aroused the most violent opposition of plaintiff.
The conduct of the president and directors when notified that their rules would be defied and during the several days that plaintiff made a point of showing his-contempt therefor, was exceedingly moderate and conservative. The rule had not been adopted in violation of the charter as both the circuit court- and court of' appeals decided, and as every court must decide, under the plain and unambiguous power conferred upon the-board by their charter. It was essentially a just and proper regulation.
The plaintiff wholly failed to show any hostile, angry or vindictive motive on the part of the defendants in proceeding to uphold the rule of the Exchange. It can not be doubted, moreover, that they honestly believed they had the right to impose the fine they did and they were advised by competent legal advisers that they could lawfully do so. While the evidence shows they intentionally imposed said fine, and suspended plaintiff, this record, is barren of evidence that they had any knowledge that their proceedings were without legal justification.
But defendants were not content to rest their defense here. The defendant directors each went upon the stand and testified that they had no personal feeling against Mr. Albers, and that they were actuated solely by a desire to maintain the dignity and rules of
There is no force in the objection that because the attorney they consulted was himself one of the three thousand members of the Exchange, the defendants could not avail themselves .-of his advice. The Exchange is not a corporation organized for pecuniary profit. It has no capital stock and pays no dividends. A membership in such a body did not disqualify counsel to advise other members as to their rights under the charter. He was not at all interested in a legal sense in the suit against them.
The court was clearly right in holding there was no evidence of malice or oppression and hence there was no possible basis for recovery of the attorney’s fee paid in the injunction suit. *
Under all the evidence there could only have been a recovery by plaintiff of nominal damages in any event.
The claim for damages for wounded feelings is without merit or basis. Whatever publicity was given to the matter was the direct result of plaintiff’s own conduct in willfully violating an obviously proper rule of the Exchange. The controversy was one of his own seeking, and he suffered no pecuniary injury whatever. His suspension was entirely disconnected with any physical rudeness or injury to his person. Any humiliation plaintiff may have felt was the consequence of his own wrongful and unprovoked act, and constitutes no basis whatever for damages for mental suffering.
Plaintiff’s appeal must fail because no error was committed to his prejudice.
III. We are now required to consider the defendants’ appeal.
. They insist they are not liable even for nominal damages and costs.
The board of directors of the Exchange were by the charter as amended created a corporate tribunal to judge what constituted corporate misconduct, and it was within their jurisdiction to determine that certain acts of plaintiff constituted misconduct for which he might be suspended or expelled.
In. other words, when acting within the powers conferred by the charter upon charges of misconduct by the member, they constitute a corporate court. Dickenson v. Chamber of Commerce, 29 Wis. 45; People ex rel. v. Chicago Board of Trade, 45 Ill. 113; People ex rel. Rice v. Board of Trade, 80 Ill. 134; People ex rel. Johnson v. N. Y. Produce Exchange, 44 N. E. Rep. 87; State ex rel. v. Grand Lodge of Missouri, 8 Mo. App. 148; Levy v. Magnolia Lodge, 42 Pac. Rep. 887; Ocean Castle v. Smith, 33 Atl. Rep. 849.
It is a cardinal principle of our jurisprudence that if an action be brought against a judge of a court of record for an act done in his judicial capacity, if he plead that he did it as judge of a court of record, this is a complete justification and where a ministerial officer does an act as a judge or does a judicial act which is within his power and jurisdiction he is not liable in a civil action by any person injured by his said act unless it be proved that the act was willful and malicious. Reed v. Conway, 20 Mo. 22; Bradley v. Fisher, 13 Wall. 335; Stone et al. v. Graves, 8 Mo. 148; Pike v. Megoun, 44 Mo. 491; Dritt v. Snodgrass, 66 Mo. 286; Edwards v. Ferguson, 73 Mo. 686; Scott v. Fishblate, 30 L. R. A. 696.
This principle of non-liability applies to the directors, trustees or other managing boards of private •corporations when exercising the judicial discretion •conferred upon them by their charters.
For mere errors of judgment by these officers of private corporations, in exercising their discretion under their charter powers, by which damage results to a member of the corporation, an action does not lie unless the act- or acts complained of are maliciously and willfully done. Their action is judicial in its character. Harman v. Tappenden, 1 East, 555; Gregg v. Mass. Medical Soc., 111 Mass. 185.
As already observed in the discussion of plaintiff’s appeal this record is barren of any evidence of malice or oppression, and as it results from the provisions of the charter that in suspending plaintiff from the privileges of the Exchange the directors were acting as a corporate court, and that they were attempting to enforce a valid and reasonable by-law to prevent smoking upon the floor during the business sessions of the Exchange, and had duly notified plaintiff, they were invested with jurisdiction and the mere fact that they rendered an erroneous sentence for a violation of their rules will not subject them to damages notwithstanding the action of the circuit court avoided the conclusion they reached by enjoining the enforcement of their judgment.
As the facts wholly failed to sustain any claim for damages we think the learned circuit court erred in di
It has become unnecessary to pass upon the validity of the by-law authorizing the board to impose a, fine. We express no opinion at this time as to its validity. We say this much, lest it might be thought we concurred in the judgment of the court of appeals in holding it invalid.
We have preferred to pass upon the other features of the case, which fully dispose of it. The judgment for plaintiff is reversed.
