Costello v. Cunningham

147 P. 701, 16 Ariz. 447, 1915 Ariz. LEXIS 160
CourtArizona Supreme Court
DecidedMarch 31, 1915
DocketCivil No. 1382
StatusPublished
Cited by23 cases

This text of 147 P. 701 (Costello v. Cunningham) is published on Counsel Stack Legal Research, covering Arizona Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Costello v. Cunningham, 147 P. 701, 16 Ariz. 447, 1915 Ariz. LEXIS 160 (Ark. 1915).

Opinion

CUNNINGHAM, J.

Reference to the parties will be made as they appeared in the complaint, as plaintiffs and defendant, for convenience.

The theory of the cause as presented by the complaint is that Patrick Cunningham acquired and owned an undivided [460]*460one-half interest in the 17 mines with Martin Costello; that Costello held the record titles in his name, and that Cunningham’s title is equitable in its nature, based upon a contract made between Costello and Cunningham; that Costello procured the record titles to the mines- in his name pursuant to such contract, and held title pursuant to the terms of the contract as to Cunningham, in trust for the use and benefit of Costello and Cunningham; that Costello sold and conveyed the whole estate, and received the proceeds of such sale; that the plaintiffs, the owners of the Cunningham interests in the property, have elected to ratify the sales made by Costello and claim their rights in the proceeds of the sales in lieu of their equity in the property in the hands of the purchasers. The defendant denies the right of the plaintiffs to recover anything upon any theory. She admits a contract was entered into between Martin Costello and Patrick Cunningham, pursuant to which Cunningham conveyed an undivided one-half interest in the Wagner group of six mines to Costello for the purpose of Costello’s holding of the record title thereto, to facilitate the procuring of United States patents and to facilitate a sale of the property. Pursuant to said contract Costello became obligated to account to Cunningham only .after a sale of said mines was made, and then only for one-half of the net proceeds of such sale, after deducting from the proceeds certain expenditures. The defendant denies that Cunningham owned any interest in the remaining eleven mines at any time, and denies all liability to account to plaintiffs for the proceeds of the sales of said eleven mines. Defendant, while confessing a liability to account for the proceeds of the sale of the Wagner group of six mines, alleges that such accounting was made with Julia Cunningham as heir, guardian of the estates of the plaintiffs, and as administratrix of the estate of Patrick Cunningham, deceased, and all matters in controversy existing between Costello and the said Julia Cunningham in her several capacities, were settled, adjusted and compromised; that Costello paid to said Julia Cunningham, as aforesaid, the moneys then found to be due and payable on account of all matters and dealings of trust and confidence between Costello and Patrick Cunningham; that Julia Cunningham, as aforesaid, received and accepted the moneys so paid in satisfaction of all such dealings of con[461]*461fidence and trust, and executed and delivered to Martin Costello her deed of acknowledgment, release, satisfaction and discharge of the said dealings aforesaid; and that her actions in this respect were reported by her to the probate court of Cochise county, and upon notice and hearing such report was approved, and her acts were, by an order of said court, duly confirmed. The plaintiffs admit that an accounting was had by Costello and Julia Cunningham in her several capacities as alleged by defendant; that Julia Cunningham received the money to the amount alleged; that she executed and delivered releases and acquittances on their faces purporting to be in settlement and compromise of all dealings of trust and confidence between Costello and Cunningham, and that her acts in that behalf were reported to the probate court and by said court approved and confirmed, but that said settlement was in effect only a partial accounting and a settlement and accounting for the proceeds of the sale of the Wagner group of six claims; that such settlement was unfair and fraudulent upon the rights of plaintiffs in the particular that by false and fraudulent representations and by undue influence and promises made and exerted by Costello, Julia Cunningham was induced to execute and deliver the said deeds of release and report said acts to the probate court, purporting on their faces to be in satisfaction and discharge of all dealings of trust and confidence between Costello and Cunningham, and that by such false and fraudulent representations and promises, and threats made by Costello, Julia Cunningham, as such representative, was induced to allow as a credit to Costello the sum of $36,396 out of said net proceeds belonging to said estate, as an attorney’s fee to James Reilly, which was unjust, unfair and fraudulent. Defendant alleges that Reilly was employed by Costello and Cunningham to perform, and he did perform pursuant- to such contract of employment, legal services in connection with the Wagner group of claims. The contract of employment provided that Reilly’s compensation should be 30 per cent of the net proceeds of the sale of the mines, and that said sum of $36,396 was equal to said 30 per cent of Cunningham’s interest in the proceeds of the sale of the Wagner group, and was the sum agreed to be paid and payable out of Cunningham’s interest. Plaintiffs do not deny the making of the [462]*462Reilly contract, except that the credit claimed and allowed to Costello for that purpose was fraudulent, unfair and unjust, the entire attorney’s fee being $72,792. The pleadings have separated the 17 mines into two distinct groups: first, the Wagner group of six mines; and, second, the other eleven mines.

The issues raised by the pleadings upon the Wagner group are simple, .and may be disposed of in a few words. The defendant clearly pleads an adjudication by the probate court of the controverted questions of the- matter of accounting for the proceeds of the sale of that property. The plaintiffs do not controvert the fact that the compromise and settlement was approved and confirmed by the court upon the report of Julia Cunningham. As a matter of law, such order of the probate court was final upon all matters acted upon until reversed or vacated. Plaintiffs do not contend that the order has been reversed or vacated. One of the matters directly involved was the charge for attorney’s fees, to be paid Reilly according to the terms of his contract of employment. The contract of employment is not denied by the plaintiffs; hence they are in no position to attack the settlement until the order confirming such settlement is vacated. The matter of settlement and compromise and its approval and confirmation are peculiarly within the jurisdiction of the probate court. The plaintiffs have raised no issues of fact for trial relating to the Wagner group of six claims, as by the admissions in the pleadings the defendant testator has accounted for his trust in that respect. The settlement and compromise could only affect the Wagner group of six mines, for the reason the defendant in her pleadings definitely limits such settlement and compromise to the proceeds of the sales of that group. For defense as to the elaim of plaintiffs for an accounting for the proceeds of the sale of the other eleven mines, defendant denies liability to account upon two grounds: first, because all dealings of trust and confidence between Costello and Cunningham were settled and compromised by Costello and Julia Cunningham, in her several capacities, and the settlement was approved and confirmed by the probate court; and, second, because Cunningham owned no estate, legal or equitable, in the other eleven mines.

[463]*463The first ground: cannot he sustained. The settlement as made had reference only to the proceeds of the sale of the Wagner group of six mines. The defendant alleges that Costello was bound to account for one-half of the net proceeds of the sale of that group, by an agreement with Cunningham.

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Bluebook (online)
147 P. 701, 16 Ariz. 447, 1915 Ariz. LEXIS 160, Counsel Stack Legal Research, https://law.counselstack.com/opinion/costello-v-cunningham-ariz-1915.