Craig v. Jo B. Gardner, Inc.

586 S.W.2d 316, 1979 Mo. LEXIS 301
CourtSupreme Court of Missouri
DecidedSeptember 11, 1979
Docket60803
StatusPublished
Cited by70 cases

This text of 586 S.W.2d 316 (Craig v. Jo B. Gardner, Inc.) is published on Counsel Stack Legal Research, covering Supreme Court of Missouri primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Craig v. Jo B. Gardner, Inc., 586 S.W.2d 316, 1979 Mo. LEXIS 301 (Mo. 1979).

Opinion

SEILER, Judge.

This case is a consolidation of separate appeals by two law firms, Jo B. Gardner, Inc., and J. Arnot Hill and his associate, Sloan R. Wilson, from a judgment in inter-pleader in the Jackson County circuit court. The main dispute is over a fee. Appeal was originally taken to the western district of the court of appeals, but the cause was transferred to this court prior to opinion because within our exclusive appellate jurisdiction under Mo.Const. art. V, § 3 (1945), since the constitutional validity of a portion of the Railroad Unemployment Insurance Act, 45 U.S.C. § 362(o) (1976) is at issue. Gardner asks us to determine whether the circuit court correctly awarded to Hill attorney fees of 25 percent of a recovery by Craig, plaintiff in the main action (a federal employers liability action, known as an FELA claim) and a defendant in interpleader, from his employer, Burlington Northern, Inc., and 40 percent to Gardner, with Hill’s 25 percent taken from Gardner’s percentage due to the latter’s promise to pay any fees owing to “other attorneys” by Craig. Secondly, we are asked to decide whether the United States Railroad Retirement Board can constitutionally claim a right to recovery under 45 U.S.C. § 362(o) of all sums paid by it to Craig from the amount collected by him in his judgment against Burlington Northern 1 and, if so, can the Board do so without payment of a portion of Gardner’s attorney’s fees. Finally, Hill argues in his cross appeal that the court erred in failing to award him his proportionate share of the income produced on the interpleader fund, in addition to his attorney fees.

The facts are somewhat involved. Briefly, Craig was allegedly injured twice during the course of his employment as a switch-man for Burlington Northern, Inc., a railroad, at its hump yard in North Kansas *319 City. The first accident allegedly occurred on September 5, 1971, the second on September 14, 1971. On December 18, 1971, Craig employed J. Arnot Hill to represent him in a suit against Burlington Northern. The portions of said contract pertinent to the issues before us stated:

“I, the said William E. Craig, hereby employ J. Arnot Hill as my attorney to prosecute my claim against the Burlington Northern Railroad in a claim for damages for injuries to my person sustained as the result of an accident which occurred on or about the 5th day of September, 1971, in Clay County, Missouri. 2

“As full compensation for his services, I agree to pay my said attorney a sum equal to 25% of whatever amount may be recovered either by settlement, suit or compromise and I hereby authorize my attorney to file suit on the above claim.”

On February 28,1972, Hill filed a petition in one count in the Jackson County circuit court against Burlington Northern, Inc., alleging injury from both accidents. Sometime in 1972, Wilson joined Hill’s firm, and took over the handling of Craig’s case. 3 Hill did not know whether Wilson had had any prior FELA experience. Both Hill and Wilson had had trial experience, although Hill’s experience was mostly in the criminal area. 4 Neither had ever litigated an FELA action like Craig’s although Hill had settled three FELA actions before trial. As detailed later herein, Craig became dissatisfied with their representation.

On July 5, 1973, Craig informed Wilson that he had decided to employ Gardner, who had had broad experience in FELA litigation. Craig and Gardner entered into a contract on July 9, 1973. In relevant part the contract stated that Craig hired Gardner to represent him in:

“the presentation and prosecution of a certain cause of action he has against Burlington Northern Railroad Co., Inc. and against all others liable for personal injuries and damages on or about the 5th day of September and the 14th of September both in 1971, caused by the negligence of said company .
and for its attorney fees second party Gardner shall have thirty-five percent of all sums before case is set for trial and 40% thereafter, after deducting doctor and hospital bills incurred for the purpose of preparing and presenting said claim . . . and in case nothing is recovered, the Second Party shall have nothing for his fees and expenses . .”

Added to the top of the contract, in longhand, appeared the following sentence:

“It is understood that 2nd party shall pay out of its fee any sums due and owing to other attorneys now employed by first party, but does not agree to defend any suit for attorney fees brought on behalf of other attorneys.”

On July 30, 1973, Craig wrote Hill and Wilson, dismissing them as his attorneys. Gardner amended the petition previously filed by Hill extensively, including dividing the suit into two counts, one for each accident. Count I was for the first accident, claiming negligence on the part of the railroad in failing to provide a safe place to work and count II was for the second accident, claiming violation of the federal Safety Appliance Act, where negligence and contributory negligence are immaterial.

On November 12, 1973, a jury returned a verdict for Burlington Northern on the September 5, 1971 accident, but for Craig on the September 12, 1971, accident, in the amount of $20,800.00. 5

*320 On November 16, 1973, Burlington filed this interpleader action to determine to whom it should pay the judgment. It paid the sum of the judgment, plus interest, into court, and was dismissed from the action. The money was invested and ultimately grew to $24,385.04. At the conclusion of the interpleader hearing, September 9, 1976, the circuit court allowed the Railroad Retirement Board $2,514.60 in reimbursement for the sickness benefits paid Craig by it prior to suit, assessed court costs of $32.50 against the fund, allowed $8,320.00 in attorneys fees (40% of $20,800.00), of which $5,200.00 (25% of $20,800.00) went to Hill and the balance of $3,120.00 to Gardner (the court determined that Hill’s fee should come from Gardner’s share because of Gardner’s promise to pay any attorneys fees due and owing by Craig at the time of his employment of Gardner), $3,774.35 to Gardner for expenses incurred and the balance of $9,753.59 to Craig. Both Hill and Gardner appealed, raising the issues noted above. With the exception of the $5,200.00, the fund has been disbursed to the parties in the respective amounts stated above.

I.

The main controversy is between the opposing lawyers over who receives what fee, into which dispute are interwoven charges and counter charges as to unethical conduct and respective competency in handling railroad cases.

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Bluebook (online)
586 S.W.2d 316, 1979 Mo. LEXIS 301, Counsel Stack Legal Research, https://law.counselstack.com/opinion/craig-v-jo-b-gardner-inc-mo-1979.