106 Neb. 635 | Neb. | 1921
Lead Opinion
This appeal is concerned mainly with a controversy between attorneys with respect to the division of fees.
The Capital National Bank of Lincoln failed in 1893 Afterwards certain actions were begun by different creditors of the bank against the directors, seeking a réc'overy from them for neglect of duty, violation of the national bank act, and other wrongful acts committed by them in their official capacity. The actions were begun in 1895, the litigating creditors'being the Jones National Bank, the Bank of Stapleliurst, the Utica Bank, Thomas Bailey, and Isaac ITolt. The firm of Biggs & Thomas .were attorneys for the Jones National Bank and the Bank of Stapleliurst. The firms of Pound & Burr, and Norval Brothers & Lowley represented the other creditors named. The contract between the several attorneys and their clients provided for a contingent fee of one-tliird of the
Mr. Thomas appealed, mainly from the allowance of. any compensation to Norval Brothers derived from the Mullen sale, urging as a ground for reversal' “that the contract: of the clients with Norval Brothers was an entire and indivisble contract for compensation contingent.,,upon success in the litigation; that, having abandoned...their contract prior to its completion and permitted. its execution to be taken over by Thomas under a new agreement with the clients, Norval Brothers forfeited all right to. demand compensation thereunder.”
■ The evidence establishes that, after the judgments had been reversed by the supreme court of this state, Norval Brothers, who had performed many and valuable services,, and had expended much time and labor in the prosecution of the several suits, became convinced that the judgment of this court could not be reversed, and that further prosecution of the actions would be fruitless, and so expressed themselves to the other attorneys, and that thereupon the agreement with Thomas was made. Mr. Lowley had died before the recovery of the judgment in the district court.
We think that neither the evidence nor the law justifies fully the contentions made by Mr. Thomas. While Norval Brothers are entitled to share in the distribution of the proceeds, we are convinced from the testimony as to the labor performed and time expended by Mr. Thomas that the amount awarded to Norval Brothers by the district court should be reduced, and that awarded Mr. Thomas and Mr. Burr increased. The evidence shows that the determination to take the case to the supreme court of
Appellant Run* contends that in such an enterprise no one attorney is entitled to greater compeixsation than another; that the alleged contract between the attorneys as to the appeal to the supreme court of the United States is void for want of consideration, is so uncertain and incomplete as to be ixnenforeeable, and had not been established by the evidexxce, and that no extra compensation should be allowed Thomas. We are satisfied with the decision of the district court upon-these points. We agree with appellant .that, in a controversy between attorney axxd client as to fees, an attorney employed on a contingent-fee basis is entitled to xxothing if he abandons the case and recovery is finally procured by another attorney. No cliexxt is complaining, and the principle is xxot applicable. The relations to be examined are those existixig among the attorneys . themselves who wei*e engaged in a joint enterprise and occupied a special partnership relation. Under the general principles of law applying to the division of fees between attorneys who are associated together in the conduct of litigation, and in the absence of any special agreement, each is entitled to an equal share of the fee. Underwood v. Overstreet, 188 Ky. 562, 10 A. L. R. 1352, and cases cited in note on page 1357. Also, see Lamb v. Wilson, 3 Neb. (Unof.) 496, on rehearing, 505. In view, however, of the pecxxliar circumstances of the case, and of the facts in evidexxce in regard to the noxxparticipation by Norval Brothers in the later conduct of the case, and the agreement between the attorneys, we are satisfied that Norval Brothers are entitled to no compensation for services performed after this agreement was made. They should, however, be allowed the reasonable valxxe of their
As- to the cross-appeal of Mrs. Lowley, we are convinced that under the evidence the district court properly found that the estate of George W. Lowley was not entitled to any share of the proceeds of the Mullen sale.
.Burr was made a party to the. appeal by Thomas. He afterwards dismissed his appeal as to Burr. He now contends that Burr is not entitled to appear as a cross-appellant in the case, and that the decree is final as to him. We. are convinced that, where the relations between the parties, the issues, and the facts are so interwoven as in this case, the appeal of Thomas brought up the whole question as to the proper distribution of the fund, and that Burr has a right to appear.
With respect to the cross-appeal of Bailey, we find that the book of accounts kept by Jones, trustee, is not fairly subject to the animadversions made upon it by Mr. Burr. It is true that the entries in the -book are made with pencil, but the items, except in a few instances, follow consecutively, and the trustee testifies they were made in accordance with the facts. Much is said about the payment of certain money to Mr. E. T. Wade of Washington, D. C., but we think there is sufficient evidence to justify the expenditure to him for his services in procuring evidence. . -
The trial court found in favor of the trustee upon the items set forth in the book, and we believe no sufficient
The judgment of the district court, except as modified by what has been said with reference to the compensation of Norval Brothers, and the distribution of the money on hand after deducting $3,000 from the amount awarded their assignees, is affirmed, and the cause remanded, with directions to enter judgment in accordance with this opinion. It is further ordered thát all costs, except briefs in this court, be paid from the common fund, and each party shall pay the costs of his or its own briefs.
Affirmed as modified: '■
Dissenting Opinion
dissenting.
The suits, in which the attorneys’ fees here in controversy were earned, were brought by several plaintiffs: The Jones National Bank, the Bank of Staplehurst, the Utica Bank, and Thomas Bailey, and Isaac Holt, in February, 1895. The firm, of which Mr. Thomas was a’ member, originally- represented plaintiffs whose claims amounted to more than 63 per cent, of the total amount claimed by. all. This firm originally represented the Jones National Bank and the -Bank of Staplehurst. The firms, of which Mr. Burr and Mr. Norval were members, represented the-other plaintiffs. The cases involved identical questions of law, and there was, therefore, a common interest and object among the several plaintiffs, and it seems, according to- the conclusions of the trial court, that after the prosecution of the cases had commenced the attorneys for the various clients reached an understanding that the prosecution of the several cases should be carried oil jointly, that the fees recovered should be pooled, and that a division of the fees should be made between the three firms.
The cases were pending in court, 'from the time of filing until their final conclusion, some 25 years. They were, at first, won in -the trial court,' and those judgments were affirmed -in the supreme court, but.reversed by the United States supreme court. On a second trial in the district
After this reversal, and when it appeared that the ehance for winning by a second appeal to the United States supreme court was a desperate one, if not entirely hopeless, a meeting was had by the attorneys, Mr. Thomas, Mr. Norval, and Mr. Burr, at which meeting Mr. Jones, of the Jones National Bank, was present, and Mr. Norval, as the trial court found, “stated, in substance and effect, that he did not think the Capital National Bank cases could be won, and that he was opposed to prosecuting said cases further, and that he was unwilling to devote any more time to said Capital National Bank cases, and,, in substance, stated that he was not Avilling to have anything further to do with said Capital National Bank cases.” It is further shoAvn by the record that Mr. Norval then advised his client to make no further expenditure in the matter, and his client thereupon sold and assigned his claim to the Jones National Bank. From that time forth, it appears that Mr. Norval had nothing whatsoever to do Avitli these cases, as an attorney,- and that he utterly abandoned any further participation in them and gave no further assistance in their prosecution.. The trial court found that from that time on “Norval Brothers performed nothing more than nominal services.-’ If the trial court, by that recital, meant to infer that,Norval Brothers did perform “nominal 'services,” I do not believe that finding is sustained by the record. Such’ a finding could have been based upon one isolated fact only, and that is that Mr. Thomas casually met Judge Norval, a member of the firm of Norval Brothers & T.owley, but not the Mr. Norval avIio had been actively-participating in the cases, and suggested to him a proposition as to whether or not findings by the supreme court in the ease could be treated as independent and original findings of fact by that court, or Avhether they should be treated simply as a review of ultimate findings',t)f fact by the trial court, and Judge Norval,
Upon this condition of the record, the trial court concluded, as a proposition of law, that Norval Brothers had not withdrawn as attorneys in the case. With that conclusion of law I cannot agree. The legal effect of the facts, as above set forth, seem to me, conclusively and unequivocally, to establish a definite and complete 'severance of their relation as attorneys from all further connection with the litigation.
The contract, such as was found by the trial court, for a pooling and division of fees between the various attorneys connected with the litigation was an entire contract, by which it was necessarily understood that each should take his remuneration from funds - which were entirely contingent upon their joint efforts, and that the joint service of all should contribute to the ultimate result. Under such an agreement, no one of them would be entitled to recover from the other what he'believed, or even, what he might be able to prove, his own services were reasonably worth. The services of - each contributed to a common cause, and the value of those services, which value was not determined by any agreement between the
The controversy, however, yet to be determined, is be
It is contended by Mr. Burr that, even though the trial court.has-made a finding of fact that there was an agreement between himself and Mr. Thomas whereby Mr. Thomas was to receive extra compensation for his serv
According to Mr. Burr’s statement, it appears that he was willing, at one time at least, that Mr. Thomas should take the share of the fees which would have been allotted to Mr. Norval, had he maintained his relations as attorney in the cases. This would have been one-third of the total contingent fee recovered. It also appears that Mr. Thomas was the representative originally of clients who had some 63 per cent, of the total amount claimed by all the plaintiffs, taken together. Had his employment continued to be several, he would have recovered, then, 63 per cent, of the total contingent fee available. It seems
It is therefore my judgment that Mr. Burr should be given $10,613.18, and Mr. Thomas $21,286.37.
The amount available as attorney’s fees from the Stuart judgment of $7,302.08 should have been equally divided between the three firms mentioned.
Dissenting Opinion
dissenting.
•The issue involved in this case is whether or not the contract btweeu the attorneys was an entire contract requiring full services to be rendered by an attorney in. order to entitle him to recover anything for services done and performed. From the nature of the case the contract foiqservices was-entire and the fees were contingent.
It appears that the firm of Norval Brothers abandoned ihe case and rendered no service after April, 1911. Their duties devolved upon Mr. Thomas and Mr. Burr. The issue presented is whether or not Norval Brothers are entitled to recover any fees after having abandoned the case.
It is the rule of this state, as said in McMillan v. Malloy, 10 Neb. 228: “One Malloy entered into a contract with one McMillan to thresh his entire crop of wheat and oats at forty cents per acre. After threshing about one-third of the crop he refused to thresh the remainder, and after the time limited for the completion of the contract brought an action to recover the value of his services. Held, first, that the entirety of the'contract having been severed, by part performance, beneficial, to the employer, the employee, was entitled to recover the value of Ms labor over and above the- damages sustained by a breach of the contract; second, when a contract has been established, the measure of recovery in each case is the price agreed upon in the contract less the damages sustained by the employer by the breach of the same.” In this case just cited some benefit accrued from, services rendered by the plaintiff, while there was no benefit aris
As further elucidating the doctrine of entire contracts see Johnson v. Fehsefeldt, 106 Minn. 202. The court castigates in substance the rule laid down by the court in the following language: “It would be obviously inconsistent with common justice that plaintiffs should recover pro tanto on the contract which they had substantially violated. They were in the wrong. They were not in a position to say to the defendant: ‘We will perform the contract we have agreed to if it prove profitable. If we find it unprofitable, we will abandon it.’ That would be to contradict the contract. Such reasoning is forbidden by its terms. Defendant did not agree in advance to a
In fact this quotation is in line with the great weight of authority and follows the majority of the cases. We should follow the rule of the. courts that one who breaches his contract cannot base an action thereon against the other party thereto. The decisions are practically unanimous in holding that neither in entire contracts nor in the units into which divisible contracts can be divided can there be any recovery on the contracts themselves when such entire contracts or units of divisible contracts have been only partly performed at the time of abandonment. This is on the theory that part performance is a condition precedent to the right. of demanding anything on the contract. See note L. R. A. 1916E, 790, 795. It is said in Hibbard v. Kirby, 38 Ark. 102: “The rule seems to be that if the contract of the servant to labor, be for a specified period of time, and payment is to be made, either expressly or by implication of law, at the end of the period, and the servant leaves the sendee of his master. improperly, without sufficient cause, and without his consent, before the termination of that time, he can recover no compensation for his services, either on the contract or on a quantum meruit." Then, again, in Badgley v. Herald, 9 Ill. 64, it was said that a contract to work for six months for $8 a month is an entire contract, and where the employee abandons the service before the expiration of that time he cannot recover for the services rendered. This meets the issue of the instant case, as does Hofstetter v. Gash, 104 Ill. App. 455, and has the approval of the great weight of authority. It has been universally held that a contract to work a stated period at a specified rate per month is entire, and that the employee cannot, upon abandoning his employment without excuse or justification before the termination of the period, recover upon the contract compensation for his
In the principles of law laid down in Huyett & Smith Co. v. Chicago Edison Co., 167 Ill. 233, it was stated that a contract to put in and complete a ventilating system for a given sum of money, all of which is to be paid in- 30 days after acceptance of the work, is an entire contract. It is also a rule that, if the subject-matter of an entire contract has been destroyed by fire or otherwise without the fault of either party before the contract is fully performed, there can be no recovery on a quantum meruit or otherwise for a part performance. This is the rule supported, by the overwhelming weight of authority. It has been followed and seems to render precise justice in the instant case. Norval Brothers abandoned their contract and plaintiffs were forced to procure other attorneys to carry out what Norval Brothers had undertaken. That would be unjust and inequitable.
In Faxon v. Mansfield, 2 Mass. *147, it was held that one who abandons the contract for the construction of a barn before the completion thereof cannot recover any part of the compensation which under the contract lie was not entitled to receive until the barn was done. Cronin v. Tebo, 71 Hun (N. Y.) 59; Jennings v. Camp, 13 Johns. (N. Y.) 94, 7 Am. Dec. 367.’ There can be no recovery on an entire contract to do an entire piece of work for a specified sum unless the work is performed; and it is evident that, when a conclusion is reached as to what constitutes an entire contract, there is little left for the court to determine. Norris v. Harris, 15 Cal. 226.
.The entirety of a contract depends upon the intention of the parties, as Avell as upon the fact that the consideration is single. The divisibility of the subject-matter or the. mode of receiving the price does not affect the question. The covenants of the contract are of course mutual and dependent according to the intention and meaning of the parties. It was the manifest intention
¡The principle of law has been, well set forth in the following statement: “If an agent.or attorney, having undertaken to collect a debt for-a certain share of What he may. - recover, finally abandons further effort as useless, and, at a subsequent period, the. principal receives payment: through new instrumentalities, or from causes with which the agent has no connection; he cannot claim the share to which his contract would have entitled him if payment had been secured by his efforts.” Scoville v. Trustees, Ill. 523. This same principle is well stated in 6 C. J. 713, 711, secs. 318, 319. Also it is held in L. R. A. 1916E, 790 et seq., that recovery cannot be had on- such a contract by one who has abandoned without just cause or excuse, nor can such a one recover on a quantum meruit. Also for a complete discussion of these matters see the note generally, L. R. A. 1916E, 790. There can be no doubt from these authorities cited that this was an entire contract. Also, as further elucidating the same principle, see Potts v. Francis, 13 N. Car. 300; Cahill v. Baird, 138 Cal. 691, and Holmes v. Evans, 129 N. Y. 140. The contract of an attorney to perform legal services in a litigation is entire and he cannot recover if he abandons without justifiable cause. Halbert v. Gibbs, 15 N. Y. Supp. 113; Cary v. Cary, 89 N. Y. Supp. 1061. Where one continues for an indefinite time until a part service is accomplished, he cannot recover where he wilfully and without cause abandons the work before the expiration of the time for the performance of the service; and this is especially applicable to the engagement of attorneys with their clients. Blanton v. King. 73 Mo. App. 118. On the theory that an attorney under such circumstances cannot recover on the principle of quantum meruit, see note L. R. A. 1916E, 790, 800. There we find the rule laid down as follows: “According to the rule adopted by the majority of the courts, there can be no recovery upon the common counts for the value of work and labor performed by a servant or person engaged to perform certain work who
We should heartily concur and give our assent to this rule. It states the laAV with reference to the intention of the parties who.made this.contract and elucidates the idta that contracts of retainer of attorneys are entire, especially Avliere the fee is contingent upon the result of the action. In support of this proposition see White v. Wright, 16 Mo. App. 551; Blanton v. King, 73 Mo. App. 148; McDonald v. De Vito, 103 N. Y. Supp. 508; Houghton v. Clarke, 80 Cal. 417. These cases Avell establish and maintain the propositions contended for. They give application to the true utterance of Avhat is right and just under .the facts herein admitted. Norval Brothers, as appears óf record, abandoned this case and did not further appear after April, 1914, and yet their services would have been helpful to a successful termination of this long and tedious litigation. The kind of contract they were Avorking under appears to be Avhat is known in the laAV as an entire contract, and it clearly Avas the intention of the parties that they should stay in the case until it was successfully terminated before they got their pay, and having abandoned it before its successful termination they cannot be counted in on the final payment for services rendered. As a condition precedent to getting their pay it is obvious from the great weight of authority, quoted and cited, that it is necessary for them to stay to the end. Such being the undisputed state of facts, Ave should adhere to the rule almost universally held that one to reap the advantages of his labor must do as he agrees and stay to the finish of his contract, and not abandon his clients Avlien half way across the stream.
I am therefore compelled to come to the conclusion that the decree, so far as it finds in favor of Norval! Brothers assignees, should be reversed. But in this connection it should be borne in mind that Norval Brothers’ assignees obtained $8,165.32, and that $7,443.18 was realized upon the judgments obtained after Norval Brothers