155 Iowa 82 | Iowa | 1912
Plaintiffs are attorneys at law, and at the time this controversy arose Senneff lived at Britt, and Kelleher at Et. Dodge. Thos. D. Iiealy, now deceased, was also a lawyer living at Et. Dodge. Plaintiff Senneff was employed by one Wells to prosecute a suit against the Western Union Telegraph Company under an arrangement substantially as follows: “The said plaintiff John A. Senneff undertook the prosecution of a suit to be brought for said A. Judson Wells against the Western Union Telegraph Company and B. G. Lyman, and undertook and agreed to prosecute the said suit to a final 'determination, and, together with such attorneys as he might select to be associated with him, to render and perform al-1 services required in the trial, preparation thereof, appeals, and all other proceedings in any manner connected with such suit, until the final termination of the litigation. By the terms of the said agreement the said Sennef was to have the right to associate with him such other attorneys as he might select, he informing the said Wells, through his said agent and representative, that he intended associating with him Thomas D. Healy and D. M. Kelleher, and said Senneff and Wells further so agreed in parol that for all services of attorneys they should be paid the equivalent of one-third of the net amount finally recovered or collected in said litigation. The said fee to be so paid to be contingent upon the successful termination of the suit and final recovery and collectimi of the claim of said Wells for which the suit was to be brought.” After making this contract with Wells, Senneff through correspondence and in various interviews, arranged with Kelleher and Healy to assist in the litigation with the understanding among all that each should share equally in the contingent fee in the event of ultimate recovery.
Plaintiffs, who are appellants, insist upon the following propositions:
(1) Where performance of contract for service of an attorney is interrupted by his death, there can be no recovery on the contract or of more than that proportion of the
(2) Where a contingent fee contract is made for services of two attorneys, and one dies even though the survivor carries on and successfully concludes the litigation with other assistants that he employs, will not entitle a recovery on the original contract. Such contract terminated upon the death of either lawyer whose services were contracted.
(3) There was no partnership relation between the plaintiffs and Thos. D. Healy, deceased. There was therefore no basis to impute an obligation or duty upon the part of the plaintiffs to perform the services contracted to be rendered by Thos. D. Healy for the benefit of his estate.
(4) The award made to the appellee by the lower court was affirmative relief granted on her claim to the full fee, and was unwarranted by the facts.
The main though underlying each of these propositions is that, as Healy died before the case was finally decided upon appeal to this court, neither he nor his representative is entitled to the full one-third of the contingent fee, but that it should be divided in the light of the services performed 'by plaintiffs after Healy’s death. It is true, of course, that these attorneys were not a copartnership; but it is equally clear that after the recovery of the judgment in the trial court, which was before Healy’s death, they were jointly interested in that judgment, and each and all desirous of sustaining it for his own individual benefit. There was at all times a joint 'adventure which did not amount to a partnership; but which is governed in many respects by the rules applicable to partnerships. This thought is well expressed in Jackson v. Hooper, 76 N. J. Eq. 185 (74 Atl. 130); Berry v. Colborn, 65 W. Va. 493 (64 S. E. 636, 17 Ann. Cas. 1018); Runkle v. Burrage et al., 202 Mass. 89 (88 N. E. 577); Botsford v. Van Riper (Nev.) 110 Pac. 705.
What, then, are the respective rights of the parties to a joint adventure such as this under the facts disclosed?
There is not in partnership the same survivorship as in joint tenancy; but there is a survivorship which is peculiar to partnership. The death of a partner invests the surviving partners with the exclusive right of possession and management of the whole partnership• property and business; but only for the purpose of selling and closing the same. (Section odd.) Until a settlement, the representatives of the deceased can not claim or take any one chattel, or any portion of the merchandise. The survivors are, from the death, trustees for all concerned in the partnership, for the representatives of the deceased, for the creditors of the firm, and for themselves. Their trust is to wind up the concern in the best manner for all interested, and therefore without unnecessary delay; and their powers are such as enable them most effectually to execute that trust. Nor do we know any difference, in this respect, as to the choses in possession and those in action. The surviving partners are held strictly as trustees; and their conduct in discharging their trust is carefully looked after by courts of equity. Thus, like other trustees, they can not sell the property of the firm and buy it themselves ; nor, as the converse of this, can they buy from themselves property for the firm. Their trust being to wind up the concern, their powers are commensurate with the trust. Hence, they may collect, compromise, or otherwise arrange
The survivors are not bound to continue the business at all; and would probably be permitted to wind it up quite abruptly if they chose not to engage in new transactions for the firm, or even continue old ones, although the new or the old seemed to promise a much better winding up at the close; . . . but if, by such new business, profit is made, the survivors will be bound to account for this profit as belonging to the firm. And, if no profit or even a loss is made, they must be charged with interest on the funds they use, and the whole loss will be theirs. It seems, however, that, ifi the survivors carry the business on, and make a profit which is credited to the firm, they may be allowed some compensation for their services, unless the articles of agreement 2>rovide otherwise. And a surviving partner may be allowed for his time and expenses, under special circumstances justifying such a claim. Parsons on Partnership, section 346.
In Ames v. Dowing, 1 Bradf. (N. Y.) 321, the court said: “Nor can Mr. Hicks charge commissions as surviving partner for the collection of the debts. His legal duty was to collect the assets and wind up the business of the firm, a duty the law imposes on him as an incident to the contract of partnership, and for the performance of which no remuneration is promised or implied. Such a claim
In Young-Scoville case supra, we said:
“Consequently it has in many eases been held that the representative of a deceased partner may have the partnership settled and an accounting had as of a date later than the death of his intestate; that to accomplish justice the partnership will be treated as a continuing one, and is to be settled as if there had been no dissolution. Of necessity much depends upon the circumstances of the particular case, and no general rule can be adopted which will fit every controversy of the kind. A court of equity will undertake in this kind of a case to do justice without reference to any settled, fixed, and inflexible rule. Parsons, Partn. (4th Ed.) section 415. See Lindley, Partn. (Ewell’s Ed.) 981, 1046; Story Partn. section 343; Taylor v. Hutchinson, 66 Va. 544 (18 Am. Rep. 699); Phillips v. Reeder, 18 N. J. Eq. 99; Robinson v. Simmons, 146 Mass. 167 (15 N. E.
Appellant has no right to complain of this, for, if he had been so advised, he could have closed up the affairs of the partnership immediately upon the death of Mrs. Laing. As he did not do so, but elected to treat the partnership as continuing, he should be held to account as if it did, in fact, continue. Another potent reason for adopting this rule is found in the fact that the referee reported that it was impossible to determine with any degree of accuracy the financial condition of the firm at the time of the death of Mrs. Laing. We see no error in the rule adopted by the referee as a basis for the accounting. Again, it is contended that the referee and the court were in error in not allowing Scoville compensation for his services in connection with the business after the death of Mrs. Laing. It seems to us that this contention is determined by the rule last above named. If the partnership for the purpose of stating the account between the parties is to be deemed a continuing one, then it is to be treated as if there was in fact no dissolution 'by death. If this be true, then neither James Laing nor William Scoville can claim anything for their services, as the labor of one was to offset that of the other. It is argued, however, that, as James Laing is not a party to this suit, he is not bound by such rule, and that, if he may in some subsequent suit recover for his services, appellant ought to be allowed for his time and labor. Sufficient it is to say in answer to this argument that we do not think the premises are correct. James Laing and his representative (she now being dead) are clearly estopped from claiming anything for his services rendered to the firm after the death of his wife. There are no facts found by the referee from which an agreement to compensate the appellant for services performed can justly or fairly be inferred, and without any agreement, express or implied, there can be no
In Starr v. Case, cited in the Young opinion, we have a case nearest in point to any to which our attention has been called. We there said:
The plaintiffs claimed $80 for services rendered by them in three several suits brought by them since the death of Mr. Patterson for the collection of claims due the firm of Starr, Patterson & Harrison. On motion of the defendants this portion of the petition was stricken out. Of this action of the court the plaintiffs complain. It is conceded that the general rule is that surviving partners are not entitled to compensation for settling the affairs of the partnership. It is claimed, however, that legal services rendered in the prosecution of claims due the partnership constitute an exception to the rule. In support of this position, we are referred to Vanduzer v. McMillan, 37 Ga. 300. That was the case of a mercantile partnership. It was held that one of the members of the firm, who was an attorney, might be entitled to compensation for services rendered by himself in the collection of claims due the partnership. In this case the rendering of such services was the business for which the copartnership was formed. We think there is nothing in this ease to make it an exception to the general rulé.
The Denver, Roane case, supra, is closely in point.
For the reasons already pointed out, it is apparent that the order of the trial court in decreeing defendant entitled to the full amount of the deposit is correct, and it is therefore affirmed.
AI-generated responses must be verified and are not legal advice.