Watson v. Citizens' Savings Bank

| S.C. | Apr 4, 1874

The opinion of the Court was delivered by

Moses, C. J.

The importance of the issue presented in the case has been recognized by our consent, not only to allow it to be docketed, but to be heard in anticipation of the Term to which it properly belongs. While it affects on the one side the professional position and interests of the bar, it is not to be forgotten that on the other it involves the authority and dignity of the bench. Justice could not be enforced in the impartial and fearless spirit which should govern and direct its administration without full power on the part of the Court to enforce obedience to its orders, subject alone to reversal or correction, in the mode provided by law.

The bar, in no small degree, contribute to the reputation of the Court. Where it is impressed with the high characteristics which give to the profession the lofty and eminent position which it maintains in the community as the champions and vindicators of public as well as of private rights, its salutary influence acts upon the Court by inspiring it with the same ennobling principles, so essential and important to the proper dispensation of law and justice. The rights of the attorney, within his proper and prescribed sphere, are as sacred as those of the Court. Both must be respected and maintained within their just limits, untrammeled by all control, except that which the law enjoins.

Influenced by the proper considerations which the character of the case demands, while we have given to it all the deliberation necessary in our judgment to a correct conclusion, in our view we see nothing which requires an inquiry into many of the points submitted in behalf of the appellants. Wl^ile they may involve abstract propositions of a very interesting nature, we do not perceive their bearing or effect upon the principles by which the case must be determined.

We do not propose to consider whether the restraining order of the 22d November, 1873, is of the class of remedies provided by the second Section of the Code, or whether, according to Title VII, it is a provisional remedy, auxiliary and subservient to the particular relief sought by the complaint, and operating for the immediate protection of the fund, the disposition of which is to depend on the final adjudication of the case. Nor do we regard it necessary to consider at length whether, in view of the bankrupt Act, before the action of the Court, which alone has the right to administer it, the State Courts have lost all jurisdiction in regard to insolvent corporations, and that, notwithstanding no interference by the United States Court, either on the motion of the corporation itself or of a creditor, a State Court which has a general equitable jurisdiction to settle the affairs of an insolvent corporation has lost it because proceedings may be instituted in the Court of Bankruptcy to withdraw from its jurisdiction the control of its assets, by subjecting the corporation to proceedings in bankruptcy in the only Court which is authorized to entertain them. In our judgment, until such adjudication, the Circuit Court of the State, under its general equitable powers in relation to insolvent corporations, preserves its jurisdiction. Nor does the examination of the cases cited for a different conclusion at all affect our judgment in this particular. Such, too, seems to be the opinion of His Honor Judge Bond, as expressed in his order of 19th December, 1873.

The jurisdiction by virtue of which his Honor the Circuit Judge made the order of 22d November, 1873, appears to us to have been within the general powers conferred by the Constitution and existing statutes. The Sections of the Code in regard to injunctions, considered as a whole by the comparison of each of its parts, do not materially change the-mode of practice which existed before the abolition of all distinction between legal and equitable remedies. It is clear that, by the 247th Section of the Code, the temporary order for an injunction may be heard without notice to the defendant. In 'fact, notice of the application might defeat the very object which the order was intended to secure. Nor did the failure of the Judge to require a written undertaking of the plaintiff to pay all damages which the corporation might sustain deprive him of jurisdiction in the motion then before him. It was not dependent on his compliance with every formal condition by which the Statutes proposed it should be conducted and regulated. There may be cases where the requirement of a bond becomes “a jurisdictional question,” as in the administration of the attachment laws, where the whole power of the Court is conferred by statute, and, in enforcing it, it can have no aid or support from its common law or equitable powers.

The pressure of business on our time will not permit us to enlarge upon all the points made by the return, which assume error in the judgment of the Court, particularly when it is remembered that, from its peculiar character, this case is taken up for its decision out of its regular order. Without inquiring whether the power which is inherent in the Court of General Sessions and Common Pleas, as a Court of general jurisdiction to punish attorneys for contempt, is restricted to that declared in the 6th, 7th and 8th Sections of Chapter CYII of the General Statutes, we concur with the Judge below in holding that the course of the attorneys, in respect to his order of 22d November, 1873, was a violation of that duty which they owed to his judicial authority. Those Sections, while not precluding his general authority, would seem to involve only his power to remove or suspend, and if considered a restraint on all other punishment of attorneys who may commit contempts, not deserving suspension or removal, would deprive the Court of the right to impose an infliction of a less severe or excessive character. It could not have been intended that a slight contempt should meet with the excessive penalty of suspension or removal from the bar. Nor are we affected by the argument on behalf of the attorneys that before the Court can exercise authority under the 7th Section of the Chapter just referred to, “the attorney must be first indicted and convicted.” That such could not have been the acceptation in which the Legislature intended the Section to be received is manifest from that portion of it which requres a copy of the charges, where the alleged offense is “ deceit, malpractice or misdemeanor, to be delivered by the Clerk of the Court.” The construction contended for would take from the Judge all right of determining the existence of the charge, and actually refer it as a question of fact to the jury. Suppose the contempt should be in a Court which decides without the intervention of a jury, and yet may suspend or remove an attorney, the power would be entirely defeated. In Stevens vs. Hill, 10 Excheq., 30, Lord Abinger said: “1 never understood that an attorney might not be struck off from the roll for misconduct in a cause in which he was the attorney merely because the offense imputed to him was of such a nature that he might have been indicted for it. So long as I have known Westminster Hall, I never heard of such a rule as that.”

The violation of an order of the Court involves a greater contempt of its authority than a mere personal affront to a Judge, even when presiding. The one, while it affects the dignity of the Court, may be repaired and atoned for by an acknowledgment by the attorney, or the punishment of the Court, but the other is calculated to impede the administration of the law by a disobedience and disregard of its orders, which, until reversed, must stand as the judgment of the Court, and from none should demand a more prompt submission than those who, by their relation to the Court, are its aids and advisers. If, until reversed, they do not at least command obedience from them, what may be expected from disappointed or dissatisfied suitors ?

We do not know that, in the case before us, the question of the regularity, or even nullity, of the order of the 22d November can change the relations of the attorneys in their duty to the Court. On the very day that it was made they asked to be heard on a motion to rescind it. This was granted, and the twenty-fourth of the same month fixed for a hearing. On that day, at their request, the time was extended, and yet the.motion was never submitted. The application by the bank to be declared bankrupt was admitted to have been on the advice of the-attorneys, and this must have been given on or before the 27th November, for, on that day, the stockholders of the corporation determined to subject it to the bankrupt law, which was accordingly done on the 1st of December following. In this we consider the wrong to the Court chiefly consisted. The character of the gentlemen engaged must prevent us from supposing that they had a deliberate intention to mislead’ the Judge, and thus quiet him in the assumption that his order would be respected, at least until the hearing of the motion on their part to rescind it. Their act; however, independent of their motive, was the matter for the consideration of the judgment of the Court, except so far as the absence of the improper motive could palliate or mitigate the sentence which he might impose for its commission. While he was induced to suppose that, so far as they were concerned, his order would be respected by their clients, it was upon their consent that steps were taken, not only to impair its validity, but to render it entirely void. The course which they proposed, in seeking its rescisión by the motion before him, was the proper one to have been pursued, and it is to be regretted that it was not followed. Lord Eldon, in Partington et al. vs. Booth et al., 3 Meriv., 149, said : “ The injunction, however erroneously granted, was an order of the Court, and must be obeyed.” Mr. Drewry, in his work on “ Injunctions,” p. 407, says: “ The proper course is not to treat it as a nullity, but apply to- the Court to discharge it for irregularity.”

The application to the Court of Bankruptcy was to act directly on the order of the Judge, and it is no excuse to say that they applied to a Court which, by the ••jurisdiction it could assume over the fund and the party, would leave his order but barren words. That they employed the surest means to render it ineffective in no way extenuates the wrong.

While the extent of the punishment may not ordinarily be a matter of consideration for this Court, yet, looking to the intimate and delicate relations which must exist between the bench and bar, we may be permitted to say, that in our judgment an attorney should only be deprived of his license to practice when he has committed a contempt of a gross and heinous character, involving either contumely or disrespect to the Judge, or a malpractice of so gross a kind as would render him an improper person to represent the rights of others. The voice of such an one should not contaminate the halls of justice. If it is to be held a proper punishment for an act involving no moral dereliction, what punishment could a Court impose upon an attorney who has disgraced the honor of his profession in the course of his practice by falsehood or perfidy ? The vocation of the lawyer is his source of living, and should he, and all dependent upon him for support, be deprived of the means of affording it when, although his act is in contravention of the rights of the Court, it has not been induced by any vicious or immoral incentive ?

The condition imposed by the Court, on the performance of which the suspension “ from his office of attorney, solicitor and counselor in the Circuit and Probate Courts of this State,” was to terminate, cannot affect the judgment pronounced, which, in our view, must operate as an immediate deprivation of the office itself. And yet it was not intended by the learned Judge to be unmeaning and impotent. It could never be effective to terminate the suspension, and still it-is clear that some benefit was proposed through its interposition. Its intent to effect a purpose favorable to them proceeded upon the assumption that in some mode they could obtain a restoration of the funds to the custody of his Court, so that his order in regard to them could attach. We cannot see how such a. result could be accomplished.. The corporation has been declared a bankrupt, its. assets areJn the charge of the Court of Bankruptcy, and no proceeding on the part of the bank, or a creditor, can transfer them to the control of the State Court. The order, as we have said, intended that a compliance with the condition should operate as an entire avoidance of it. Are we at liberty, with this fact ¡ratent in the order, to give to the qualification the effect which must attach to an impossible condition, and declare that it was intended to have no other force ? This could only be done through a construction of the orders which we must assume was never intended. If a condition is impossible, and so we regard this, the act to which it is annexed takes effect, and so far, in this particular case, from avoiding the judgment, makes its terms binding and conclusive. This could not have been the purpose of the learned Judge. We do not agree with His Honor in respect to so much of the order as requires the fees received by the counsel to be “ restored to the bank and the custody of the Court.” A fair construction of the order of 22d November only applied the restriction to “paying out the funds, or otherwise disposing of the property and effects of the said corporation, by its officers and agents.” We do not regard the term “ agent ” in the significance which it is to receive in its application to the subject-matter as comprehending the attorneys of the corporation. The prohibition was against paying out, not against receiving.

Can the order be so understood as to prevent a creditor of the institution from accepting payment of his demand without rendering him liable to be charged with a contempt for so doing ? It was not to be supposed that the services which the attorneys gave by any advice to the bank in relation to the order of 22d November, were to be without compensation. It is also in our judgment a clear violation of the injunction for the parties to pay out of the fund attorney’s or counsel fees. The object of the injunction was to preserve the fund, in order that it might be placed in the hands of a Receiver, should it appear that one was necessary. A Receiver would not be justified in making payments of that character -without the order of the Court, and the parties in interest, bound by the injunction, could not do what it is improper for a Receiver to do. As the attorneys in the cause were not named in the order, they are not directly liable for a breach of it, but, under their general duty, they are chargeable as for a contempt if they co-operate with parties to violate an injunction.

In any point of view, we cannot regard the mere acceptance of the money as a remuneration for their professional services, unless through some fraud practiced on the Court, as a contempt deserving so great a punishment as that which has been inflicted.

Cases of this character, fortunately rare in this State, from the high and honorable reputation of its bar, are of the most unpleasant nature. When contempts of Court, by its own counsel, are prompted by a purpose to attack its dignity, and depress the moral and official influence of those who preside over them, the punishment, no matter how severe, should, within judicial discretion, be adequate and sufficient to repress the evils which are their usual consequences. Where, however, they are charged against counsel of character, who, by their sworn returns, disavow all purpose of committing them, the dignity of the Court is as well vindicated by a light as by a severe infliction.

We do not feel the force of the argument on the part of the counsel that a mere disclaimer of all intention of contempt, where it is of a constructive kind, so completely purges it as concludes all further proceeding. The authorities do not sustain the proposition to the extent stated. Such a rule would make the Court powerless to punish even a gross contempt on the mere disclaimer of all intention. While the.intention is often the criterion by which criminal acts are judged, the absence of it in the perpetration of wrong does not always discharge one from the consequences which may follow. In High on Injunctions, Section 849, it is said: “Nor does the question of the motive, or intent with which the writ was disobeyed, alter or vary the responsibility for the violation.”

It is true that a disavowal of purposes, with an expression of regret that such a construction has been put on the act of a party as to hold him answerable for a contempt, will opérate to his benefit in the measure of the penalty. We would have been better satisfied if we had perceived in the returns of these gentlemen, which disclaim all intention of committing a contempt, a declaration of their regret that His Honor the Judge had misconceived their purpose and intention.

It is adjudged that the order of 12th January, 1873, be set aside, and the rule and returns remanded to the Judge for such further proceedings as he may regard proper thereon.

Wright, A. J., and Willard, A. J., concurred.