143 Minn. 251 | Minn. | 1919
Plaintiff, a dealer in automobiles, brought this action to recover damages for conversion of an automobile and certain books and papers. The value of the property was alleged to be $1,200. He also sought to recover $5,000 special damages for mental anguish caused by the malicious conduct of defendants in taking the property, and $3,000 for destroying his trade and business. The mortgage company and Hinrichs answered jointly and alleged that they held three notes on which plaintiff was liable as maker or guarantor, amounting to $1,562.74. The notes were severally pleaded as counterclaims. Hagen answered separately and set up a counterclaim of $400 for services rendered to plaintiff. Plaintiff demurred to each of the counterclaims, and on September 9, 1918, noticed the demurrers for argument on September 21. On September 10 a settlement was made, whereby the parties mutually released and discharged each other from all claims and demands, and stipulated that the action then pending should be dismissed. Garnishment proceedings, which had been instituted, were also dismissed and the garnishee discharged.
Charles E. Bowen was plaintiff’s attorney in the action. He had a written contract with plaintiff whereby it was agreed that he should receive as compensation for his services “45 per cent of the amount recovered in the adjustment of (plaintiff’s) claim by suit or otherwise.” The summons was served on August 6 and filed on August 11, 1918.
In the settlement, plaintiff got from the mortgage company the three notes upon which its counterclaims were founded and a check for $471.-52. He also got a release from Hagen of the latter’s claim for services. The total amount thus received was $2,489.31. The court found that all the counterclaims were valid and that plaintiff was legally bound to pay them.
On September .20, 1918, an order was entered requiring defendants to show cause why the settlement agreement should not be set aside, the amount to which plaintiff’s attorney was entitled as compensation for his services determined, and judgment rendered for the amount so determined, pursuant to the statute relating to attorney’s liens. The matter was submitted on the files in the case and affidavits of the parties and their attorneys. The court awarded plaintiff’s attorney $1,119.18 as compensation for his services under his contract of employment, and $10.95 to reimburse him for the expenses of bringing suit, and he was given judgment against defendants accordingly. They appeal from the judgment.
The attorney’s lien statute has been frequently before this court for construction and application. The original statute was amended by chapter 98, p. 121, Laws 1917. So far as here material, the statute now provides that an attorney has a lien for his compensation upon the cause of action from the time of the service of the summons, that such lien may be established and the amount thereof determined by the court summarily in the action on the application of the lien claimant, and that judgment shall be entered under the direction of the court, adjudging the amount due and the sale of the property subjected to the lien to satisfy such amount.
Under this rule, if plaintiff had recovered a judgment against the mortgage company and it had obtained a judgment against him in an independent action brought on his notes, it could have set off such judgment against his, and thus defeat the lien of his 'attorney. If his rights in the case supposed would have been subordinate to such right of set-off, they must also be subordinate to the right of each defendant to set off the original demand on which the judgment would be founded if recovered in an independent action brought thereon. In principle, it is immaterial whether a defendant resorts to an independent action to recover upon a demand he has against plaintiff or asserts such demand by way of counterclaim. It follows that by canceling a portion of plaintiff’s claim for unliquidated damages by the surrender of the notes and
The weight of authority sustains the conclusion we have reached. It is generally held that an attorney’s lien should extend only to the clear balance found to be due his client either at the termination of the litigation or in the settlement, if one is made. Nat. Bank of Winterset v. Eyre, 8 Fed. 733; Bosworth v. Tallman, 66 Wis. 533, 29 N. W. 542; Tiffany v. Stewart, 60 Iowa, 207, 14 N. W. 241; Mosley v. Norman, 74 Ala. 422; Popplewell v. Hill, 55 Ark. 622, 18 S. W. 1054. The rule has been happily stated as follows: “Natural equity says that cross-demands should compensate each other by deducting the less sum from the greater, and that the difference is the only sum which can be justly due.” Story, Eq. Jur. § 1868.
A new trial is unnecessary in view of the full and specific findings which were made. The judgment should be modified and the case is remanded with directions to amend the findings of fact and conclusions of law so as to provide that plaintiffs attorney shall have a lien of $223.-13 upon the cause of action herein, with interest thereon from September 14, 1918, and for judgment against defendants for that amount with costs.
Judgment modified.