54 F. 231 | U.S. Circuit Court for the District of Northern New York | 1893
This action was originally brought by Charles A. de Chambrun against the defendant Campbell, as trustee, alleging negligence, fraud and breach of trust, by which certain moneys and securities belonging to the complainant were diverted and lost. The judgment demanded is that the rights of the defendant Gesner in the trust be adjudged and determined, that thereafter a final accounting be had between the complainant and Campbell, and that tire latter shall be adjudged to pay over to the complainant all moneys and securities found due on such accounting. Charles A. de Chambrun died September 18, 1891, and his son Pierre, as administrator, revived the action. The leading facts, out of which this controversy arises, so far as it is necessary to refer to them for the purposes of the present decision, are as follows:
On the 20th of April, 1876, Charles A. de Chambrun entered
Various efforts to adjust the interests of the different claimants to this fund having failed, a suit was commenced in January, 188G, by Stephen M. Chester, as assignee of the claim of one of the lawyers who had been retained by De Chambrun early in the proceedings, to have the amount of his lien and of the other liens determined and paid. All of the parties interested in .the said fund, including De Chambrun and Campbell, were made defendants. The complaint set out, in extenso, all the facts relating to the Jumel litigation, the fact that De Chambrun, Campbell and the other parties with whom De Chambrun had contracted, claimed to share in and to have liens upon the said property, and demanded judgment that the plaintiff’s lien and all other liens, including those of De Cham-brun and Campbell, be fixed and their priority determined. The defendants all filed answers fully stating the nature of their interest in the fund. So far as Campbell and De Chambrun are concerned their respective claims, which were entirely antagonistic, were set out fully and in detail. There can be no pretense that De Chambrun after reading the averments of Campbell’s answer, which was served upon him, had any doubt as to the nature of Campbell’s position.
The attitude of De Chambrun and Campbell in the Chester suit was one of bitter hostility. Each knew that the other’s position if sustained would defeat his own; and though both were defendants their respective contentions were fully as antagonistic as if they lad occupied the position, of plaint iff and defendant, It was, in short, a struggle for priority among claimants to an inadequate fund. The trial of the issues thus joined was referred to Mr. Hamilton Cole, a prominent and most reputable member of the New York bar. At the trial De Chambrun was represented by counsel who objected to the proof of Campbell’s claim and proposed findings which, if adopted, would have entirely excluded Campbell from participation in the fund. The referee declined to find as De Cham-brun requested and the latter excepted to his rulings. The referee reported in favor of various lien holders and fixed the order of priority among them, awarding the balance, if any, to De Chambrun. On this report a decree was duly entered. De Chambrun, among others, appealed from this judgment, but it was finally affirmed by the court of appeals. Chester v. Jumel, 125 N. Y. 237, 26 N. E. Rep. 297.
Pending the suit of Chester v. Jumel an action was commenced by Jean AlToert Tauziede, and another, against the same defendants, substantially, as in the Chester suit, praying that the trust property bo sold,-that the Drench heirs be paid the 52-J per cent, due to them from the proceeds of such sale and that the remaining 47⅞ per cent, be paid into court to be disposed of as the court might direct. Campbell and De Chambrun both answered, setting up facts, in substance, the same as in the Chester suit. The trustee having realized the sum of 8336,226 from, the sale of the property-in his hands, judgment was entered in the Tauziede Case, on the 4th of October, 1883, providing for a division of the fund and fixing the amounts which should be paid to the various claimants. Subsequently they were paid pursuant to the terms of this judgment, which was affirmed bv the court of appeals, May 3, 1892. Tauziede v. Jumel, 133 N. Y. 614, 30 N. E. Rep. 1000. The first conclusion of law in the Tauziede Case is as follows:
‘‘It is ordered, adjudged and decreed that the judgment entered in this court on tlio 21st day oí May, 1888, ns directed by üie report of TXamiUon Colo, referee, in the action wheren Stephen M. Chester was plaintiff and Francois Henry .Tumel and others were defendants, determines and adjudicates the rights of the parties hereto and is hereby declared to be conclusive upon all parties to this action.”
The principal accusation against Campbell seems to center in the disposition of the so-called Chase claim. Nelson Chase was a tenant upon and a claimant of the Jumel estate, his title being disputed by the heirs of Stephen Jumel. On the 3d day of March, 1876, De Chambrun entered into a contract with E. Delafield Smith whereby he agreed to pay to said Smith an indebtedness due him from said Nelson Chase to the amount of about $25,000, which was “to be paid to the said Smith out of the proceeds of said Jumel estate so acquired by the said heirs, or any interest therein, after the payment of all proper disbursements, and is hereby made a charge upon the same.” Smith died April 12, 1878. On the 17th of May, 1882, Margaret J. Smith, as executrix of E. Delafield Smith, assigned to Campbell all of the claims held by said Smith, including the Chase claim. She was, however, to receive $25,000 and interest, before any payment under the assignment was to be made to Campbell who assigned to her a lien upon the fund in his favor, created by De Chambrun, for $25,000. The bill alleges that the true intent and purport of these assignments was that the claim of the estate of E. Delafield Smith should, as between De Chambrun and the said Smith estate, be limited to the sum of $25,000. That Campbell was to hold the legal title to all the claims which E. Delafield Smith had upon the Jumel fund, including the Chase claim, subject only to his lien for legal services, in trust for De Chambrun, who was to have the balance after paying Mrs. Smith $25,000 and Campbell Ms charges as counselor. Complainant’s contention is that if the Smith claims had been allowed in full, including the Chase claim, Ms intestate would have received a large sum, to wit, about $50,000.
‘■That Margaret J. Smith is not entitled to recover in this action. That the contract of January 5, 1877, between De Chambrun. and E. Delafield Smith gives no lien upon the property held by Elliott as trustee. That Douglas Campbell has no interest in or lien for legal services upon the contract and claims assigned to Mm by Margaret J. Smith on May 17, 1883.”
These requests were refused and counsel for De Chambrun excepted.
The instrument of July 21, 1882, in which Campbell declared that he held the Smith assignments for the benefit of De Chambrun, subject only to his interest therein and lien thereon for legal services, was brought to the attention of the referee by another defendant, Mrs. Gesner, who is also a defendant in this suit. This instrument was put in evidence in the Chester suit by Mrs. Gesner, together with an assignment by De Chambrun to her of said instrument and all his right, title and interest therein. ’The referee found all these facts and in his tenth conclusion of law divided the fund in accordance with this declaration of trust of July 21,1882. The court in the Chester Case had all the evidence that this court has and ail the evidence that could be produced bearing upon the Chase claim. The referee made full findings regarding this claim, but did not allow it. Why he did not allow it is not a pertinent; inquiry here. It is enough that with all the facts before him he did not do so. Mo one till now seems to have questioned his decision. It cannot be attacked collaterally. The only person connected with the Chester suit who took any steps to have the claim allowed was the defendant Campbell. He alleged the claim in his answer and proved it on the trial, and yet he is accused of negligence, conspiracy and fraud in not having had it allowed. De Chambrun, who did everything in Ms power to defeat the claim, now, through his representative, accuses Campbell of attempting to defraud him because he did not, in some way not pointed out, coerce the referee into finding that the claim was valid. The argument in this regard seems to proceed upon the theory that the referee was a mere puppet in the hands of Campbell and that the cause was decided by the latter and not the former. But all this is the merest conjecture without a particle of evidence to support it, and the theory cannot be reconciled with the well-known character of the referee for honor, independence and ability.
Without pursuing the discussion further I may say, as a result of my examination of this complicated record, that I fail to find any proof which will warrant a finding that the Chester judgment was procured by the trickery or fraud of the defendant Campbell. This being so the well-known rule applies: That a judgment, not fraudulently procured, rendered by a court of competent jurisdiction in an action involving the same subject-matter between the same parties, or their privies, “is, as a plea, a bar, or, as evidence, conclusive” as to all matters actually determined or which might have been litigated and decided “as incident to or as essentially connected with the subject-matter of the litigation, and every matter coming within the legitimate purview of the original action, both in respect to matters of claim and of defense.” The complainant’s intestate proceeded in the Chester suit upon the theory that he could subordinate all the other liens to his. He was defeated and now his administrator seeks to recover upon a totally different and antagonistic theory which might have been presented in the Chester suit, but was not. It is too late now. Parties are not permitted so to experiment with the courts. The wise and salutary doctrine of res judicata is, it is thought, controlling of the issues in this cause. The bill is dismissed.