Miller v. Washington County

| Tenn. | Sep 15, 1920

Mr. Justice I-Iall

delivered the opinion of the Court.

The bill in this cause was filed by the complainants, S. E. Miller, Harr & Burrow, and Sam W. Price, members of the Washington county bar, against Washington county and the members of the Washington County Good Roads Commission, both in their official and individual capacities,'seeking to recover the sum of $15,000, alleged to be due the complainants as the reasonable value of their legal services rendered the defendants in the case of State of Tennessee ex rel. J. W. Cox et al. v. G. C. Horn et ál. which was a hill filed in the chancery conrt of Washington county by the Washington County Good Roads Commission to compel, by writ of mandamus, the chairman and cleric, respectively,'of the county, court of Washington county to issue, sign, and countersign $750,000 of interest bearing coupon bonds of said county, the issuance of which had been authorized by the qualified voters of said county in an election held under chapters 25 and 131 of the Private Acts of 1917. These acts authorized and empowered Washington county to lay off, construct and build a system of highways in said county with the proceeds of the bonds to be issued. The acts created a commission, composed of five members, to be known as the “Washington County Good Roads Commission,” and provided that the members of this commission should be elected at the same time and in the same election held for the purpose of voting on the proposition to issue the bonds authorized by said acts. The acts expressly clothed the commissioners to be elected with authority to contract for the construction and improvement of said roads, and to do any and all things necessary to carry out the purpose of said acts.

The defendant road commissioners in the instant cause were elected commissioners at said election, and after due qualification entered upon their duties as such.

It was further enacted that each of the bonds issued should be signed by the chairman of the county court, and countersigned by the county court clerk, with the ofixcial seal of the latter attached thereto.

It was further enacted that not less than ninety-five per cent, of the fund derived from the proceeds of the sale of the bonds should be expended in the actual construction on contractors’ estimates,, and not more than five per cent, of said fund should be expended for expenses of. any kind or character.

Both the chairman and clerk of the county court refused to sign and countersign said bonds, being of the opinion that said acts were unconstitutional, on account of which the institution of the mandamus proceeding was made necessary.

The mandamus suit was sharply and vigorously contested, both in the chancery court and in this court, and resulted in the constitutionality of said acts being upheld, and in the chairman and clerk of the county court being required to sign and countersign said bonds, after which a sale of them was negotiated and consummated by said commissioners. In that litigation the road commissioners, by resolution duly passed, employed complainants to represent them in the mandamus proceeding, and complainants did represent them in said proceeding, both in the chancery court and in this court, and it is to recover for these services that the present bill was filed. ■

To complainants’ bill the defendants filed a demurrer. By this demurrer it was insisted: (1) That Washington county could not be held liable, for the.reason that the bill did not show that Washington county, as a county, authorized the employment of the- complainants, and the commission was without authority to bind the county; and (2), that the Washington County Good Roads Commission, as a commission, could not be held liable, because the act under which it was created did not vest it with authority to employ counsel to represent it in said litigation, and it was therefore without authority to expend any portion of the money derived from the sale of said bonds in the payment of attorney’s fees; and (3),, that the Washington County Good Roads Commission, as individuals, could not be held liable for the fees of complainants, for the reason that any action taken by them was as officials and not as individuals, and in the absence of a showing of bad faith upon their part no individual liability could attach.

The chancellor sustained the third ground of said demurrer, holding that the commissioners were not individually liable, but, if liable at all, they were only liable in their official capacity. The other grounds of the demurrer were overruled.

Whereupon the defendants answered the bill, denying that either the county or the commissioner's were liable to the complainants in the sum-of f15,000.

The answer averred that at the time the complainants were employed by the road commissioners to institute said mandamus suit in the chancery court of Washington county, the question of what fees the complainants should have for their services was discussed, and that it was agreed between complainants and said road commissioners that it shouldfbe left absolutely to said commissioners to fix the fees which complainants should receive after tbe litigation bad been terminated, and that tbe commissioners met pursuant to said agreement, and, after due consideration of tbe matter, determined that' a fee of $1,500 would be reasonable compensation for tbe complainants’ services rendered in said suit, and’ bad offered to pay complainants this sum as full compensation for tbeir services, but that complainants bad refused to accept tbe same, and that ^ defendants, if liable at all, were not liable for a greater sum than $1,500'.

In tbeir answer they demanded a jury to try and determine tbe issué of fact presented: A motion was seasonably made by defendants to bave tbe chancellor transfer tbe cause to tbe circuit court of tbe county for trial by a jury under the provisions of chapter 90 of tbe Public Acts of 1919. This motion was overruled by tbe chancellor, to which action tbe defendants excepted.

Tbe cause was thereafter finally beard, by the. chancellor upon the pleadings and proof, and be held that tbe complainants were entitled to recover of tbe road commissioners, as such, tbe sum of $4,500, as tbe reasonable value of tbeir services rendered in the mandamus suit, both in tbe lower court and in tbe supreme court, and ordered said sum to be paid out of tbe five per cent, of tbe proceeds of said bonds which the acts provided might be used by tbe commissioners in tbe payment of any and all expenses which might accrue in carrying out tbe purposes of tbe .acts.

From this decree and tbe decree overruling tbeir demurrer tbe defendants prayed and perfected an appeal to this court, and bave assigned errors.

¡Complainants-appealed from so much of said decree as fixed the reasonable value of their services at- only $4,500, and have assigned errors on this phase of the cause.

We will first dispose of the assignments of error filed by. the defendants,'the first of which is that the chancellor erred in not sustaining the second ground of their demurrer, and in not holding that the Washington County G-ood Roads Commission was without authority to employ counsel to represent them in said mandamus proceeding filed in the chancery court of Washington county, because the act under which said commission was created did not cornier any such'authority upon it.

We are of the opinion that this assignment of error is not well taken. While the net did not expressly vest in the commission the power to institute suits necessary in carrying out the purposes of the act and to employ counsel in such suits, it did expressly clothe said commission with the power and authority to do all things necessary to carry out the purposes ofJsaid act, and we think the power to employ counsel and institute any suit that might be necessary to enable them to accomplish the purposes of the act is a necessary incident to the powers expressly conferred upon the commission. The commission created by said act to carry out its purposes will be treated as a quasi-public corporation, and was not therefore restricted to the exercise of powers expressly conferred upon it by the act creating it, but was clothed with such implied powers as were necessary to carry out the powers expressly granted, and to accomplish the purposes for which it was created. R. C. L., vol. 7, section 513.

While a corporation is a creature of statute, it is true that some things by common law are incident ,to-it, which it may do without any express provision in the charter of incorporation; such as to sue and be sued, etc. The extent of its powers are those enumerated in its charter, or implied by fair and natural construction of powers expressly conferred. Jonesboro v. McKee, 2 Yerg., 167—170; Mallory v. Hanaur Oil Works, 86 Tenn., 598" court="Tenn." date_filed="1888-05-08" href="https://app.midpage.ai/document/mallory-v-hanaur-oil-works-3895038?utm_source=webapp" opinion_id="3895038">86 Tenn., 598, 8 S. W. 396; Union Bank v. Jacobs, 6 Humph., 515—521.

It is next insisted that, even if the road commission, as a necessary incident to the powers expressly conferred upon it, were authorized to institute an action of mandamus to compel the chairman and clerk of the county court to sign and countersign said bonds, their action in employing counsel to prosecute said action was illegal and void, because by sections 1629 and 5768 of Shannon’s Code it is made the duty of the attorney-general of the district in which the suit is filed and the attorney-general of the State to represent the county and all county and state agenfcies in such suits. By section 1629 of the Code referred to it is provided as follows:

“In case of an appeal, the district attorney-general shall attend the case for the county in the circuit court, and shall be paid the sum of five dollars for each case attended to,, and the attorney-general for the State shall represent the county in such cases before the supreme court.”

By section 5768 of the same Code it is provided as follows :

“It shall be the duty of the district attorneys to co-operate and assist upon the request or direction of the attorney-general for the State in the bringing, prosecution, defense, preparation, and trial of all cases in the circuit and chancery courts in which the attorney-general of the State is now or may hereafter be required to appear for the protection of the State or the public interest.”

The first section aboye quoted has reference only to appeals in cases where an application has been made to open, change, or close a road to the commissioner of the district through which the road runs, or is asked to be located by any person or persons considering themselves aggrieved by the action of the jury of view appointed to condemn and assess the damages of the landowner or landowners whose lands are to' be taken. It has no reference to suits or actions of the nature brought by the Washington County Good Roads Commission against the chairman and . clerk of the county court of Washington county to compel them to sign road bonds to be issued by the county.

It was held in the case of the State v. Jesse Adler et at., 48 Tenn. (1 Heisk.), 547, that section 5768 of Shannon’s Code referred alone to criminal prosecutions.

We know of no statute, and our attention has not been called to any, which makes it the duty of either the district attorney-general or the attorney-general for the State to institute and prosecute an action, such as the one brought by the road commission of Washington county, or that prohibits such a commission from employing counsel to .represent it in litigation that may arise out of the. performance of its duties and the execution of its powers. We, therefore, hold that said commission was clothed with power and authority to employ the complainants to represent it in said mandamus action, and, as such, is liable to the complainants for the reasonable value of their services.

The case of State v. True, 116 Tenn., 294" court="Tenn." date_filed="1905-12-15" href="https://app.midpage.ai/document/state-v-true-8300391?utm_source=webapp" opinion_id="8300391">116 Tenn., 294, 95 S. W., 1028, which is relied on by counsel for the defendants to support their contention that the road commission was not clothed with power to employ counsel and bring said suit, is not applicable. In that case it was held that neither the chairman of the quarterly court, or the quarterly coui’t itself, was clothed with power to bring suit to prevent a misappropriation of the public school funds, in the hands of the.trustee of the county, because such school funds were not the property of the county, and its authorized agents had no control of them; but the power to bring such a suit was vested alone by statute in the hands of the State superintendentent of public instruction.

It is next insisted that the chancellor erred in disallowing the motion of the defendants to have said cause transferred to the circuit court of the county for trial before a jury, as provided by the terms of chapter 90 of the Public Acts of 1919. By the first section of this act, sections 4465, 4466, 4467, 4468, 4469, and 4470 of the Code of 1858, relating to jury trials in chancery court, are .repealed. By section 2 of said act it is provided as follows.

“That every party, hereafter suing in the chancery court upon a cause of action of which that court has jurisdiction by virtue of an act passed March 23,1877, and approved March 26, 1877, being chapter 97 of the Acts of Tennessee of 1877, entitled ‘An act to increase the jurisdiction of the chancery court,’ or by virtue of any admendment thereof, shall be conclusively .presumed to have waived the right to demand a trial by jury-by -not having elected to sue at law, and that every defendant to every such suit shall likewise be conclusively presumed to have waived the right to a trial by jury unless a jury shall be demanded in the first pleading filed by him making or tendering an issue of fact.”

Section 3 provides: “That whenever any defendant shall have demanded a trial by jury in the chancery court in any cause of which that court shall have jurisdiction by virtue of said act, or by virtue of any admendment thereof, as provided in section 2 of this act, the chancellor, by an order made either in term time or at chambers, shall transfer the cause to the circuit court of the county in which it shall' be pending, and -the clerk and master shall immediately deliver all papers in the cause, together with a certified copy of the order of transfer, to the clerk of the circuit court of such county, who shall immediately file the same and docket the cause in said circuit court, where it shall be tried before the court and a jury. Provided, that no provision of this act shall apply to ejectment suits, or suits in the nature of ejectment, to recover land.”

The chancellor was of the opinion that the present action was not one of which the court acquired jurisdiction by virtue of the act of 1877, but that it was a cause falling within the inherent equitable jurisdiction of said court, and therefore a trial by jury was not an absolute right which the defendants had, in view of the repeal of the sections of the Code above referred to, but was a matter within the discretion of the court. This holding was based upon the theory that the suit was one against the trustees of a trust fund, and sought to have a sufficiency of said fund in the hands of the trustees appropriated to the satisfaction of their claim, and that the chancery court has exclusive equitable jurisdiction to deal with such a fund.

The sections of the Code repealed by chapter 90' of the Acts of 1919 were predicated on chapter 122 of the Acts of 1845-46, granting to either party to a suit in chancery, upon application, a jury to try and determine any material fact in dispute.

The constitutional provision that “the right of trial by jury shall remain inviolate” (article 1, section 6) has no reference to suits brought in the chancery court, but refers alone to actions triable at common law. Neely v. State, 4 Baxt., 180; McGinnis v. State, 9 Humph., 53, 49 Am. Dec., 697; Goddard v. State, 2 Yerg., 99; Jackson v. Nimmo, 3 Lea, 613.

It was held by this court in the case of Allen v. Saulpaw, 6 Lea, 477, that before the passage of the act. of 1845-46, the granting of a jury, or the ordering of the submission of facts to a jury, was largely a matter of discretion with the chancellor; but after the passage' of the act of 1845-46, it became the right of either party to demand a jury to try and determine any issue of fact involved in any case pending in the chancery courts of the' State, and the finding of the jury in the premises was given the same force and effect as at law. ,

Since the repeal of the sections of the Code embodying the provisions of the act of 1845-46, by chapter 90 of the Acts of 1919, neither party has an absolute right to a trial by jury in suits of which the chancery court had jurisdiction prior to the passage of chapter 97 of the Acts of 1877, but the granting of a jury, or the ordering of a submission of the facts to a jury, is again left discretionary with the chancellor. By the act of 1877, the jurisdiction of the chancery court was increased so as to give it concurrent jurisdiction with the circuit court of all civil actions, except for injuries to persons, property, or character involving unliquidated damages, and in these cases, by the terms of chapter 90 of the Acts of 1919, the party who brings his suit in the chancery court is conclusively presumed to have waived the right to demand a trial by jury, not having elected to sue at law, and the defendant to such suit shall likewise be conclusively presumed to have waived the right to a trial by jury, unless a jury shall be demanded in the first pleading filed by him making or tendering an issue of fact.

Section 3 of the act provides that if the defendant demands a jury in the first pleading filed by him making or tendering an issue of fact, the chancellor, by an order made in term time or at chambers, shall transfer the cause to the circuit court of the county in which it shall be pending for trial before the court and a jury. The act, however, expressly provides that it shall have no application to ejectment suits, or suits in the nature of ejectment to recover land-

We are of the opinion that the chancellor was correct in holding that the suit at bar was not one of which the chancery court acquired jurisdiction by virtue of the act of 1-877, but was a suit of which said court had inherent equitable jurisdiction. This is true because it sought to reach the trust fund in the hands of the road commissioners of Washington county, and the chancery court only had power to impound and apply such fund, or a sufficiency thereof, to the satisfaction of complainants’ claim. We do not think it, will be disputed that the circuit court has no jurisdiction- of cases involving in any manner the administration of a trust fund, but that jurisdiction belongs alone to the chancery court, as before stated. We think, therefore, that the granting of a trial by jury was a matter within the discretion of the chancellor.

The remaining assignments of error urged -by the defendants, as well as the assignment of error filed by the complainants, go to the amount of the fee allowed by the chancellor. It is insisted by the defendants that the sum of $4,500 allowed the complainants as the reasonable value of their services is unreasonable and excessive. It is their insistence that the question of fixing the compensation which the complainants should have for their services was, by agreement, left to the discretion of the commissioners, and that the commissioners met and determined, after due consideration of the matter, that the snm of $1,500 would be reasonable, and that this amount only should have been alloAved complainants by the chancellor.

Upon the other hand, it is insisted by the complainants that the fee of $4,500 is grossly inadequate for the services rendered by them, and that they are' entitled to a much larger sum.

We are of the opinion that the chancellor reached the justice of the matter when he allowed the complainants the sum of $4,500. We do not think that the defendants’ contention that the fixing of the-amount of the compensation which the complainants should have for their services was left, by agreement, to the discretion of the commissioners, is sustained by a preponderance of the evidence. If, however, we are wrong in this view of the evidence, and it was agreed that the commissioners should fix their compensation upon the termination of the litigation, still we think the sum fixed should be reasonable and fairly commensurate with the services rendered. We do. not think that the sum of $1,500 was reasonable. Nor do we think that the complainants are entitled to a greater sum than the $4,500 allowed by the chancellor. While the ' suit was an important one, it only involved the constitutionality of the statute under which the bonds for $750,000 were to be issued. It cannot be assimilated to a suit having for its purpose the recovery of that amount, and, unless recovered, tbe defendants would have sustained a heavy financial loss.

Without further elaboration, we are content to affirm the decree of the chancellor.

The Washington County Good Roads Commission, as such, will be taxed with the costs of the cause, which costs will be paid out of any portion of the five percent, of the bond issue that may be in their hands, .and which the act provides may be used in defraying expenses incident to carrying out the purposes of the act.