127 P. 315 | Idaho | 1912
Lead Opinion
This is an appeal from a judgment sustaining a demurrer to plaintiff’s complaint and dismissing plaintiff’s alleged cause of action. The material allegations of the complaint are as follows:
Appellant is a corporation organized under the laws of the state of Utah, carrying on a general business of publishing credit ratings of firms and corporations and furnishing commercial information and adjusting and collecting delinquent and disputed accounts and claims for an agreed commission or rate of compensation. On about the 3d of June, .1903, respondent delivered to appellant for collection a certain claim against Simonds Bros, of Ft. Wayne, Ind., for the sum of about $1,160, together with $108.70 accrued interest, and employed and instructed the appellant to collect the same on certain agreed rates of commission or compensation. Appellant began negotiations for the collection of the claim, and in order to defray the expenses demanded of the respondent
The first question to be determined on this appeal is, whether the common-law rule of champerty prevails in this state. Champerty, which seems to be a species of the ancient law of maintenance, consisted in supporting or maintaining a suit for someone else in consideration of a bargain or agreement to have a part of the thing in dispute or some profit out of the results of the litigation or an agreement to divide the receipts derived from the suit or action. Maintenance of
There is a great diversity of opinion among the courts as to whether the common-law doctrine of champerty ever became a part of the body of the common law of this country. In Indiana (Hart v. State, 120 Ind. 83, 21 N. E. 654, 24 N. E. 151), Kansas (Aultman v. Waddle, 40 Kan. 195, 19 Pac. 730), Kentucky (Lucas v. Allen, 80 Ky. 681), Maine (Hovey v. Hobson, 51 Me. 62), Massachusetts (Ackert v. Parker, 131 Mass. 436), Missouri (Duke v. Harper, 66 Mo. 51, 37 Am. Rep. 314), Oregon (Brown v. Bigne, 21 Or. 260, 28 Am. St. 752, 28 Pac. 11, 14 L. R. A. 745), Rhode Island (Orr v. Tanner, 12 R. I. 94), Utah (Croco v. O. S. L. R. Co., 18 Utah, 311, 54 Pac. 985, 44 L. R. A. 285), Vermont (Hamilton v. Cray, 67 Vt. 233, 48 Am. St. 810, 31 Atl. 315), Wisconsin (Miles v. Mutual Reserve Fund L. Assn., 108 Wis. 421, 84 N. W. 159), District of Columbia (Matthews v. Hevner, 2 App. Cas. (D. C.) 349; Peck v. Heurich, 167 U. S. 627, 17 Sup. Ct. 927, 42 L. ed. 302), Illinois (Thompson v. Reynolds, 73 Ill. 11), Minnesota (Gammons v. Johnson, 69 Minn. 488, 72 N. W. 563), Montana (Quirk v. Muller, 14 Mont. 467, 43 Am. St. 647, 36 Pac. 1077, 25 L. R. A. 87), the doctrine seems to have been adopted in a more or less modified form,- while it has been wholly repudiated in Arkansas (Lytle v. State, 17 Ark. 608), California (Howard v. Throckmorton, 48 Cal. 482), Connecticut (Richardson v. Rowland, 40 Conn. 565), Delaware (Bayard v. MacLane, 3 Harr. (Del.) 139), Iowa (Wright v. Meek, 3 G. Greene (Iowa), 472), Maryland (Schaferman v. O’Brien, 28 Md. 565, 92 Am. Dec. 708), Michigan (Wildey v. Crane, 63 Mich. 720, 30 N. W. 327), New Jersey (Schomp v. Schenck, 40 N. J. L. 195, 29 Am. Rep. 219), Nebraska (Omaha R. & R. Co. v. Brady, 39 Neb. 49, 57 N. W. 767), Texas (Wheeler v. Riviere (Tex. Civ.), 49 S. W. 697), Tennessee (Sherley v. Riggs, 11 Humph. (Tenn.) 53), and West Virginia (Lewis v. Broun, 36 W. Va. 1, 14 S. E. 444).
California, the state from which we took the great body of our original statutes, repudiated this doctrine as early as 1863, and in Mathewson v. Fitch, 22 Cal. 86, the supreme
Viewed in the light of what has been said above, we fail to find anything in the contract in this case that renders it obnoxious to any statute of this state or contrary to good morals or sound public policy. It does not appear that any of the officers or agents of appellant were attorneys or that this purchase was made by an attorney or for the purpose or with the intent of commencing an action thereon. It is true that an action was contemplated in the event the debt should not be paid without action. That was legitimate and proper. The assignment of a half interest in the claim was apparently made for the purpose of compensating the appellant for its labor and outlay in making the collection. This claim and account owned by the respondent was property and a property right, and under the laws of this state a man may sell any property or property right which he possesses, and what he may lawfully sell another person may lawfully buy, unless specifically forbidden and prohibited so doing by statute.
This case is quite different in its facts from the Utah ease of Nelson v. Evans, 21 Utah, 202, 60 Pac. 557, cited and relied on by counsel for respondent. In that case a firm of attorneys employed in a case entered into a contract with one Nelson, whereby they agreed to give him “one-third of one-half of any amounts which may be collected, either on compromise or otherwise, in the case of Alfred H. Nelson, etc., v. The Southern Pacific Co., in consideration of said Thomas Nelson furnishing witnesses necessary to prosecute said case.’’ The court held that this contract was “champertous and against public policy.” The same view was taken by the Utah court in In re Evans, 22 Utah, 366, 83 Am. St. 794, 62 Pac. 913, 53 L. R. A. 952. We doubt very much if any court would disagree with the Utah court in holding such a contract contrary to good morals and sound public policy, and
The demurrer in this case should have been overruled, and the defendant should have been required to answer. The judgment will therefore be reversed and the cause is remanded, with direction to take further proceeding in accordance with the views herein expressed. Costs awarded to appellant.
Concurrence Opinion
Concurring Specially. — The only question presented by the record in this case is whether the statutes of the state, to wit, secs. 4900 and 6524, were intended by the legislature as enactments controlling contracts between a client and his attorney in the employment of the attorney by the client.
Champerty, as defined by Blackstone, is “a bargain with a plaintiff or defendant campitm partiré, to divide the land or other matter sued for between them if they prevail at law, whereupon the champertor is to carry on the party’s suit at his own expense.” (4 Black. Com. 135.) Lord Coke, in defining champerty, says: “To maintain to have part of the land or anything out of the land, or part of the debt or other thing in plea or suit.” This definition of Coke (Co. Litt. 368-b) is followed by many of the courts of this country and is cited in vol. 5, Am. & Eng. Ency. of Law, p. 816 et seq.
The generally accepted definition of champerty, as above stated, is recognized and applied both in England and in most of the states, and the courts have held that every contract or agreement into which champerty enters as a consideration is illegal and void, and where an action is brought directly upon a champertous contract, that champerty is a good defense.
It is also a Avell-recognized rule adopted by the courts of the United States that where champerty is not recognized or approved, and the legislature of a state has enacted a statute, such statute has modified the application of the generally accepted definition of champerty to the statutory provisions.
See. 18, Rev. Codes, provides: “The common law of England, so far as it is not repugnant to, or inconsistent with, the constitution or laws of the United States, in all eases not provided for in these Revised Codes, is the rule of decision in all courts of this state.” Under this provision of the statute, the common law of England upon the subject of cham-perty is immaterial and not involved in this case, even if the statute is not as comprehensive as the common law. This court should look to the statute alone as a .guide in determining whether or not a contract between an attorney and client is “to maintain to have part of the land or anything out of the land, or part of the debt or other thing in plea or suit. ’ ’
Applying this rule to the facts in this ease, as stated in the majority opinion, it is clear there was no violation of the provisions of secs. 4900 and 6524.