29 Mont. 397 | Mont. | 1904
Lead Opinion
delivered tbe opinion of tbe court.
This action was commenced June 4, 1898, by Forrester and MacGinniss, plaintiffs, against tbe-Boston & Montana Consolidated Copper & Silver Mining Company of Montana, tbe Boston & Montana Consolidated Copper & Silver Mining Company of New York, tbe board of directors of tbe Montana Company, and certain stockholders and holders of proxies, to restrain the transfer of tbe property of tbe Montana, Company to tbe New York Company, to secure tbe appointment of a receiver for tbe Montana Company, and for other relief. A full statement of tbe facts in this case is contained in tbe opinion heretofore rendered by this court (Forrester et al. v. Boston & Montana C. C. & S. M. Co., 21 Mont. 544, 55 Pac. 229, 353), to which reference is made. A temporary injunction was issued, and afterwards a receiver appointed. After tbe appeal from tbe order granting tbe injunction bad been decided against tbe defendants, and they bad made numerous unsuccessful attempts to prevent tbe property falling into tbe bands of tbe receiver, on April 9, 1899, they filed in tbe district court their written consent that a decree might be entered enjoining tbe transfer of tbe property of tbe Montana Company to tbe New York Company, enjoining tbe voting of tbe stock in favor of any such transfer, enjoining tbe New York Company from operating tbe property in any manner, and requiring that company to redeliver to tbe Montana Company tbe possession of tbe property in controversy, and adjudging tbe acts of tbe directors
If the transfer or attempted transfer by the Montana Company to the New York Company and the deed evidencing that transfer were in fact null and void, then they conveyed no right or title to the New York Company. A void transfer is, in effect, no transfer. A void deed is, in effect, no deed. Such a deed is a nullity ab initio. However, discussion of.the question is foreclosed by the offer of appellants and the former decision of this court (Forrester et al. v. Boston & Montana C. C. & S. M. Co., 21 Mont. 544, 55 Pac. 229, 353, above), where this cause wasi fully considered. In disposing of it this court said: “Holding, as we do, that the proposed transfer is ultra vires the corporation, and therefore void, consideration of the question whether the transaction would, if accomplished, result in a consolidation or merger of the Montana Company with the New York Company, is unnecessary.” Aind this view finds support in the following authorities: McShane v. Carter, 80 Cal. 310, 22
It is true that in Boston & Montana C. C. & S. M. Co. v. M. O. P. Co. (C. C.), 89 Fed. 529, Judge De Haven held that the attempted transfer by the Montana Company to the New York Company was, only voidable, and not void; but we think that decision is in conflict with the great weight of authority, and we prefer to follow the former decision of our own court.
As stated above, the appellants made an offer in writing that judgment might be entered in favor of Forrester and MacGin-niss, and this court directed the trial court to enter judgment in conformity with the same. Upon this particular question the appellants’ offer contains these provisions, which they proposed should be incorporated in the judgment, viz.: “Also adjudging that the acts of the directors and officers of the Montana Company, so far as relate to the sale or conveyance, or the attempt to sell or convey, the property1 of the said Montana Company to the said New York Company, be declared null and void, and that the deed of conveyance heretofore given to the said New York Company by the officers and directors of the said Montana Company, and executed in its name, for all the property and rights mentioned or described in Exhibit A of the complaint herein, which deed is recorded on page 175 of Book No. 29 of Deeds Beeords of Silver Bow county, Montana, be declared null and canceled; and that the said New York Company be forever enjoined from asserting any claim under said deed to said property; also- that said New York Company be declared to have no- right, title or interest in or to any of the property of the Montana Company heretofore at any time conveyed or attempted to be conveyed by said Montana Company to said New York Company.”
We are unable to perceive the difference, in legal effect, between the offer and the decree, and are of the opinion that in this regard the lower court followed the directions given by this court, and that as to> this portion of the judgment it was entered by consent, and appellants will not be heard to complain of it.
Upon the first proposition it is sufficient to say that the officers and trustees of the Montana Company had assumed to transfer the entire property of the corporation to the New York Company. These plaintiffs
Having determined that plaintiffs could maintain tbe action, tbe next inquiry is, were they successful? and tbis question is answered in tbe affirmative by the offer of defendants to permit judgment to be entered, and tbe entry of judgment accordingly ; and tbe doctrine is settled beyond controversy that under sucb circumstances tbe prevailing minority stockbolders may recover tbeir attorney fee. Tbis brings us to a consideration of a much more difficult question, viz., bow shall sucb fee be recovered ? Obviously, it is permitted upon one of two theories: First, that tbe fee is a part of plaintiffs’ costs taxable according to tbe course and practice of courts of equity, and included in tbe final decree; or, second, that it is money paid out and expended for tbe use and benefit of tbe derelict corporation, and recoverable in an action at law. Numerous cases are cited by counsel of these suits successfully waged by minority stockholders, where an attorney fee has been allowed to tbe plaintiffs; but in most, if not every1, instance a receiver bad been appointed, and tbe property was in tbe actual custody and control of tbe court. Tbe amount to be allowed as sucb fee was determined by a reference to a master, and when tbe amount was reported it was included in tbe final decree, and directed to be paid out of tbe property recovered or protected by tbe suit. Tbe mere fact that these courts say that it is proper to make such payment out of tbe trust fund throws little, if any, light upon
We are not impressed with the suggestion that such fee is allowed as a part of the expense of administering’ the trust fund in the hands of the court, for that can refer only to the administration by the court through the receiver, and costs of such administration are costs and expenses incident to such receivership only, while there is no relation whatever between the rights or liabilities of the plaintiffs to the action and the receiver. He is supposed to remain neutral while the litigation is being waged by the contending parties.
Wickersham v. Crittenden, 103 Cal. 583, 31 Bac. 513, cited by appellants, is not decisive of any question involved in this action. In that case Wickersham, who was a minority stockholder in the San Luis Obispo Bank, instituted two' suits against Crittenden, the bank and others, to recover for the bank certain funds. The actions were successful, and the judgment in each instance recited that the recovery was for the use of the bank. Upon appeal each of the judgments was affirmed. Afterwards Wickersham sought, by motion, to have his attorney fee paid to him out of the money recovered, notwithstanding he had not had it allowed and included in the judgments. The lower court made an order to^ that effect, but on appeal the order was reversed. The court said: “The judgments as rendered in the superior court were affirmed in this court, and were, of course, final judgments, and they did not include attorneys’ fees. They directed the moneys recovered, together with the stated costs, to be paid to the bank • and the superior court could not, upon petition or motion, change or modify these final judgments by ordering the moneys recovered to be disposed of in any way other than provided in the judgments themselves.”
In Grant v. Lookout Mountain Co., 93 Tenn. 691, 28 S. W.
We can see no reason why the power of the court to allow an attorney fee should he made to depend upon the mere possession of the trust fund. The most forceful objection to the manner of allowing the fee in this case is that it deprives the defendants of a jury trial of the issue as to the amount to be allowed as such fee, but this objection could be urged with equal propriety in every case where such a fee is allowed out of the trust fund. The allowance of such fee and the determination of the amount by the chancellor have become the settled practice in courts of equity. If such fee was recoverable only as for money paid out for the use and benefit of the defendant corporation, we are unable to understand how it could be allowed out of the corporate property by the chancellor. The action to recover money paid to the use of another is an action in assump-sit — an action at law. The very fact of the allowance of such a fee and the determination of the amount thereof by the chancellor incline us to the belief that it has never been considered money paid out for the use of the defendant corporation, but costs incident to the suit; and this belief is strengthened by the further fact that in every instance the right to recovery is made to depend upon the success of the minority stockholder’s suit. If he is successful, he is entitled to recover his attorney fee; if he is unsuccessful, he is not entitled to recover it. If the fee was recoverable as for money paid out for the use of the defendant corporation, the success or failure of the litigation in which it was expended would have little to do with the right to its recovery.
Impelled by these considerations we are of the opinion that the attorney fee was properly allowed by the court as a part of plaintiffs’ costs and ¿xpenses, taxable according to the course and practice of courts of equity. In this view of the case, the
The authorities are unanimous in holding that the plaintiffs are entitled -to' recover a reasonable attorney fee, and for the purpose .of determining the amount of such fee the following rule has been laid down: “The circumstances to be considered in determining the compensation to be recovered are the amount and character of the services rendered, the labor, time and trouble involved, the character and importance of the litigation in which the services were rendered, the amount of money or the value of the property to be affected, the professional skill and experience called for, the character and standing in their profession of the .attorneys. * * * The result secured by the services of the attorneys may be considered as an important element -in determining their value.” (3 Ency. Law, 420; 4 Cyc. 994.) In the absence of any showing to the contrary, the presumption must be indulged that the trial court followed this well-established rule.
The record discloses that five firms of attorneys, namely, Mc-Ilatton & Cotter, Glayberg & Corbett, Cullen, Bay & Cullen, Bobert B. Smith, and Charles B. Leonard, were employed by, and participated in the litigation on behalf of, the plaintiffs. John. J. McTIatton, one of the attorneys for plaintiffs, testified to the work done by the several firms in the litigation (various phases of which litigation have been before this court — Forrester et al. v. Boston & Montana C. C. & S. M. Co., 21 Mont. 544, 565, 55 Pac. 229, 353; State ex rel. Boston & Montana C. C.
If the doctrine above announced is correct — and we think it is — the purpose of the action, then, is to recover back the trust fund, or all of the property of the corporation which is about to be dissipated, and in the present instance it was the entire property of the Montana Company, valued at about $40,000,-000; and such value was properly considered in determining the attorney fees to be allowed the plaintiffs for the successful prosecution of the action, which ought to have been brought by the corporation itself, had not its officers and trustees, breached their trust.
Neither do we think there is any merit in appellants’ contention that the expert witnesses were improperly permitted to take into consideration services rendered in certain- special proceedings instituted in this court, and in which the lower court was nominally a party defendant or”respondent. One object of tliis action was to have a receiver appointed to- take charge of the property of the Montana Company pending the litigation. The action of the district court in” making this appointment-was
Appellants further contend that it was error to include attorneys’ services which were unsuccessful, and reference is made to certain motions and the appeal from the order of the lower court refusing to discharge the receiver, which were unsuccessfully opposed by the plaintiffs. We understand the rule in suits of this character instituted by minority stockholders to be that, if the action is successful, the plaintiffs may recover their attorney fees; if unsuccessful, they may not. But the rule applies to the ultimate object to be attained, and not to every step, which may be taken in the course of the litigation. If in the end the plaintiffs accomplished the purpose for which the suit was instituted, their efforts were successful, however many intermediate orders or rulings may have been made against them.'
With reference to tbe questions asked the 'witness McHatton, it is sufficient to say that on bis direct examination be did not testify with reference to tbe value of tbe services rendered, and therefore could not be cross-examined respecting tbe same.
Tbe opportunity to cross-examine tbe opposing party’s witnesses is a matter1 of right; but tbe latitude of cross-examination is very largely in tbe discretion of tbe trial court, and an appellate tribunal will not interfere unless that discretion is oppressively abused. (8 Enc. Pleading & Practice, 109, and numerous cases cited.) Tbe record discloses that reasonable latitude was allowed in tbe cross-examination of these witnesses, and in excluding answers to tbe foregoing questions we are not prepared to' say that such an abuse of tbe trial court’s discretion is shown as would warrant interference by this tribunal, if tbe examination was otherwise proper. It has been said that evidence of what another attorney received in tbe same ca§e, or in other particular cases, is not admissible in determining tbe value of services performed. (3 Ehc. Law, 424.) We are not prepared to say that the line of examination indicated by tbe questions above quoted was proper cross-examination, or that answers thereto would have thrown any light upon tbe question at issue or upon tbe qualification of tbe witnesses testifying. Certainly, under tbe shoAving made by tbe record in tbe action, no such abuse of discretion is shoAVn as: would warrant a reversal of the judgment.
One question directed to tbe witness Goddard might properly have been answered, and error is predicated by appellants upon tbe ruling of tbe court, as follows: “(12) Tbe court erred in sustaining objection to- tbe question asked witness Goddard, as follows: £Q. Mr. Goddard, I will ask you if you know
A careful review of the case leads us to the conclusion that no error prejudicial to the appellants was committed.
The appeal from the order allowing the attorney fee is dismissed, and the judgment is affirmed.
Affirmed.
Rehearing
ON MotioN eor Rehearing-.
(Decided April 12, 1904.)
In support of their motion for a rehearing, appellants direct our attention to an inaccuracy in out statement of their contention. The mistake occurs in paragraph 3 of the opinion heretofore rendered wherein we say that appellants contend that the allowance for attorneys’ fee was premaurely made, for the reason that the judgment in which it is included is not a final judgment, while appellants’ contention actually was that such judgment was not the final judg-ment in the case, or, in other words, that the judgment entered did not finally dispose of the suit, for the reason that the accounting had not been had. It is, however, fairly deducible from the pleadings that the accounting was only an incident to the main purpose to be accomplished by the suit, namely, to
Tbe motion for a rebearing is denied.
Denied.