Kilham v. Wilson

112 F. 565, 50 C.C.A. 454, 1902 U.S. App. LEXIS 3885

• Court: Court of Appeals for the Eighth Circuit
• Decided: January 3, 1902
• Docket: No. 1,499
• Status: Published

Opinion

ADAMS, District Judge,

after stating the case as above, delivered the opinion of the court.

The bill of complaint in this case is very lengthy, and contains a variety and great prolixity of averments; but when analyzed it is found to state a cause of action founded on a contract by which th© defendant agreed to employ the complainant’s intestates to make sale of a ranch belonging to him, and agreed to pay them (besides a certain fixed commis’sion, not now in controversy) a contingent compensation of whatever they might secure for defendant in excess of the sum of $225,000; and to assert a claim that they are .entitled by virtue of their contract to $50,000 as their contingent compensation. On account of the fact disclosed by the record that defendant finally received cash, notes, and property for his ranch in lieu of money exclusively, complainant asserts thatdefendant is in some manner a trustee with respect to the property in question, and, as such, subject to equitable jurisdiction for an accounting, to determine the rights and interest of complainant’s intestates in and to the same. It is contended—and with much reason—that complainant mistook his remedy, that complainant’s intestates never had -any lien on the property for their compensation, that defendant never was trustee for them, that the record presents no case for an accounting in equity, and that complainant’s only available action was at law to recover for money had and received by defendant to complainant’s use. It is unnecessary and inadvisable, in the view we take of the plea, of former adjudication, to express our. conclusion on this contention. The view suggested by the bill, but apparently not vigorously contended for in argument, that defendant is somehow under obligation to complainant by reason of an alleged failure to have for sale the full number of cattle and the full extent of range originally represented to belong to him, and also by reason of the several modifications of the original contract between defendant and the English company, is, in the light of the proof, worthy of no consideration. The contract of December 14, 1883, fixing, among' other things, 6,000 head of cattle as the minimum number for delivery to the purchasing company, and providing for a bond to secure the manual delivery of all thereof prior to the final round-up in the year 1885, superseded all prior contracts, and complainant’s intestates so recognized it, and agreed that all obligations of defendant created by anv former contracts with them were canceled and held for naught. On December 15, 1883, they entered into the following agreement with defendant, namely:

“Denver, Colo., Dec. 15, 1883.

“Whereas, a certain contract or contracts have heretofore been entered into between William J. Wilson, of Denver, Colorado, of the one part, and William S. Everett and J. M. Robinson, Esqrs., of Chicago, Ill., and each of them, of the other part, for the sale of the Circle Ranch, horse and cattle, belonging to said Wilson; and whereas, a contract has this day [obviously referring to the contract of date December 14, 188SJ been executed by the said Wilson, as , vendor, and the said Everett, as ag’t and guarantor of the said Wilson, for the sale of said ranch and cattle to the New U. S. Cattle Ranch Company of London, England, and which last, contract supersedes all other prior contracts in which the names of said Everett and Robinson or either of them appear: Now, therefore, all contracts, agreements, obligations, or other liabilities heretofore entered into, and in which the names of said Everett and Robinson, or either of them, appear, are canceled and held for naught, and the said Wilson is hereby released from same; the commissions to said Everett and Robinson to bo |5,000 and a reasonable amount above said sum as may he just and fair according to the advantage said [and! William S. Everett may prove to be, in having- parties purchaser receive the property sold under and virtue of contract of sale made this day as we may agree upon.

“LSigned] William S. Everett.

“ W. J. Wilson.”

The modifications of the contract made thereafter, consisting of substituting a bond, with sureties, conditioned for securing and depositing- in escrow deeds conveying 3,000 acres of land in fee simple at some time in the future in lieu of immediate delivery thereof, and other modifications in the details of executing the contract, were undoubtedly well known to and acquiesced in by the complainant’s intestates. Even if they were not, it is difficult for us to perceive how they could have materially affected the rights of complainant’s intestates. They were to secure a purchaser for the ranch on terms satisfactory to defendant. He alone had the right to determine the consideration for which he would sell the same, and also the details governing the payment therefor to him. They were interested solely in the surplus he might receive over and above $225,000.

Having disposed of the foregoing matters, we are now brought to what complainant’s counsel calls the principal question in the case, .and one to which their argument is mainly addressed, namely, whether defendant so declared a default, so exposed the property for sale under the chattel mortgage, or so indirectly purchased property at that sale in violation of the laws of the state of Colorado as to avoid the same, and entitle complainant to an accounting, based upon what the property sold was really worth, instead of upon what it actually brought at the sale. If the sale was valid, defendant never received the amount of $225,000 for his ranch, and, much less, any sum in excess of $225,000, so as to entitle complainant to anything for the contingent compensation sued for in this action. A large amount of evidence was taken on this issue, but, in the view we take of the effect of the action at law and the judgment therein rendered, it is unnecessary to enter upon a consideration of this evidence. On January 28, 1886, Everett and Robinson, in their lifetime, instituted their action at law in the circuit court of the United States for the district of Colorado against William J. Wilson, the defendant herein. They filed a complaint in words and figures as follows:

‘•For a canse of action plaintiffs say that heretofore, to wit, on the first ■day of November, A. D. 1885, defendant became and was indebted to plaintiffs in the sum of sixty-five thousand dollars on an account for services by plaintiffs performed at the: request of defendant at. the city of Chicago, in the state of Illinois, and at the said district of Colorado, and at London, England, between the first day of June, 1883, and the first day of November, A. D. 1885, in and about the sale of certain lands and certain horned cattle and other personal property of defendant; that defendant hath not paid the said sum of money nor any part thereof. Wherefore plaintiffs demand judgment against the said defendant for the sum of sixty-five thousand dollars and their costs.”

In due course of procedure a bill and supplemental bill of particulars was filed in the case, as follows:

“William J. Wilson to William S. Everett and James M. Robinson, • Dr. To, services rendered by the said Everett and Robinson between June 1st, 1883, and November 1st, 1885, at your request, in and about negotiating a sale for your behalf to the New United States Cattle Ranch Company, Limited, of London, England, of the Circle Ranch, located on the Republican river and its tributaries in the states of Colorado, Kansas, and Nebraska, with the appurtenances and the cattle and horses which were an or about the 14th day of December, 1883, upon the range belonging to or connected with the said Circle Ranch, and the buildings, dwellings, branding irons, books, and records of said Circle Ranch, and the saddles, bridles, and harness connected with or belonging to the said ranch, two patented horse hayrakes then upon the said ranch, and the other cattle or property belonging to or connected with the said Circle Ranch on the 14th day of December, 1883, aforesaid, and the water rights and other rights 'and privileges pertaining to the said ranch, $65,000. The said services were rendered under an oral employment of plaintiffs by said Wilson, by which plaintiffs were to receive for their commissions, in the first' instance, five thousand dollars ($5,000), and all that the property should sell for over two hundred and twenty-five thousand dollars ($225,000). This employment of the plaintiffs was made some time in the summer or fall of 1883, and reiterated and renewed in Chicago about February, 1884. By a subsequent arrangement the defendant agreed to pay plaintiffs the further sum of ten thousand dollars ($10,000). Plaintiffs’ services were rendered and negotiations carried on partly by letter, partly by telegram, and partly orally through agents of the plaintiffs in London, England. The time consumed in such correspondence and negotiations it is impossible to state. The same took place at intervals between the time of the first employment and the conclusion of the sale in the spring of 1884. Plaintiff Everett made one trip from Chicago to Denver, in December, 1883, occupying about two weeks, the purpose of which was to confer with the defendant, and settle and adjust the terms of an agreement to be executed by defendant, and to be submitted to the proposed purchaser. Plaintiff Everett and plaintiff Robinson both made another trip to Denver in February, 1884, remaining three weeks, or thereabouts. There were oral negotiations had between plaintiffs and the agents of the purchaser, both in Chicago and in the state of Colorado. These extended over several weeks. The number of hours or days consumed, or the number of hours or days consumed in the negotiations in London, cannot be stated.

“[Signed] ' Wells, Macon & McNeal, Pl’ffs’ Att’ys.”

An answer was filed to their complaint putting in issue the plaintiffs’ right to recover any commission, either fixed or contingent. A trial was duly had, in which plaintiffs asserted a claim for $15,000 for commissions alleged to have been agreed upon, and, in addition thereto, $50,000. as a contingent compensation based on the alleged fact that the ranch and property were so sold as to bring defendant that much in excess of $225,000. To sustain their claim to the $50,000 contingent compensation, the plaintiffs asserted and introduced proof tending to show that the sale under the chattel mortgage was void for the same reasons as are urged in the present case. The proof offered at that trial is preserved in the record now before us, and it appears upon examination that the entire subject of the chattel mortgage sale was thoroughly exploited. All the facts relating thereto were then comparatively fresh in the minds of the parties, and were fully available to the plaintiffs to support their theory. The sale occurred in 1885; the trial was had in 1887. At that trial the plaintiffs contended, among other things, that the true value of all property purchased by one Green, ostensibly for himself, but really for the defendant, Wilson, should be ascertained, and charged up to Wilson, in order to determine what he actually received for the ranch, and thereby to determine how much the plaintiffs were entitled to as their contingent compensation. The court charged the jury, among other things, to the effect that on the evidence produced there was nothing to impeach the regularity or validity of the sale under the chattel mortgage, and, after instructing the jury on the issues raised by the pleadings relative to the fixed commissions, the-court charged, in effect, that, even if there was an agreement by which the plaintiffs were to receive as further compensation any sum in excess of $225,000 which defendant might receive from the English company, there could be no further recovery on that account, because the evidence showed that no sum in excess of that sum had ever been received by Wilson. The jury retired, and brought in a verdict in favor of plaintiffs for $10,000, and were discharged. Subsequently, on the next day, the court, at the request of counsel for the plaintiffs in that action, permitted the jury which had tried the case and been discharged, to be again brought into the box, and permitted plaintiffs’ counsel to put the following question to them: “Did you include in your verdict the plaintiffs’ claim for any excess over the sum of $225,000, denominated in the evidence 'the surplus profits’?” The former foreman of the jury answered the question thus: “Our understanding is that Wilson never received .anything in excess of $225,000.” Afterwards final judgment was duly rendered on the verdict in favor of the plaintiffs find against defendant, Wilson, for $10,000. This judgment was reviewed on writ of error by the supreme court of the United States in Wilson v. Everett, 139 U. S. 616, 11 Sup. Ct. 664, 35 L. Ed. 286, where, on page 620, 139 U. S., page 665, 11 Sup. Ct., and page 288, 35 L. Ed., the court says:

“All tlie Instructions complained of in these assignments of error, except the second, involve only the matter of the surplus over $22r>,000: and, as it clearly appears that that portion of the plaintiffs’ claim was disallowed, there could have been no prejudice to the defendant.”

The judgment below was accordingly affirmed, with 10 per cent, damages.

From the foregoing it clearly appears that the very claim asserted in this action was sued for in the action at law, deliberately heard on practically the same issues and evidence, and adjudged in favor of the defendant. The complainant in the present action is the representative of Everett and Robinson, who were plaintiffs in tlie action at law, and seeks to assert their rights against the defendant, Wilson, who was the defendant in the action at law. The action at law therefore was between the same parties, or their privies, as are now before the court in the presént action; was founded upon the same claim or demand which is now asserted, and a final judgment upon the merits was rendered thereon. The judgment in that case constitutes a conclusive estoppel against the prosecution of the present action. By well-settled authority it concludes the parties and their privies “not only as to every matter which was offered and received to sustain or defeat the claim or demand, but as to any other admissible matter which might have been offered for that purpose.” .Cromwell v. Sac Co., 94 U. S. 351, 352, 24 L,. Ed. 195, 197; Board v. Platt, 25 C. C. A. 87; 91, 79 Fed. 567, 571; James v. Iron Co., 46 C. C. A. 476, 496, 107 Fed. 597, 617. It makes no difference that the former action was at law and this in equity. Conceding, for the present purposes, that the facts of this ease might entitle complainant to relief in equity, it is undoubtedly true that equity affords only .a concurrent remedy. The irregularities or fraud claimed to have vitiated the sale under the chattel mortgage could have all been shown, as they were in fact shown, in the action at law. If established, they would have entitled plaintiffs in that action to ignore the sale which was set up as a barrier to them. Even if an accounting in equity offers a more satisfactory relief than a proceeding at law for the same purpose, a suitor cannot subject a defendant to the expense and trouble attending the defense of an action at law, and, after suffering an adjudication against the right to any accounting, resort to a court of equity to secure the same. Mr. Justice Miller, in discussing the subject of estoppel by judgment in the case of Miles v. Caldwell, 2 Wall. 35, 39, 17 L. Ed. 755, 757, makes use of the following language:

“The second proposition in respect of which complainant asks relief— that the mortgage to Carswell and McClellan is fraudulent, made to hinder creditors—is one of the common grounds of equity jurisdiction. To relieve against fraud and set aside and cancel fraudulent conveyances are among the ordinary duties of courts of chancery. Courts of law, however, have-concurrent jurisdiction of questions of fraud when properly raised; and although they cannot cancel or set aside fraudulent instruments of writing; yet, when they are produced in evidence by a party claiming any right under them, their fraudulent character may, under proper circumstances, be shown, and their validity in the particular case contested.”

' In the case of Blanchard v. Brown, 3 Wall. 245, 18 L. Ed. 69, the supreme court had occasion to consider the effect of an action in ejectment in which the defendant endeavored to impeach the plaintiff’s title for fraud, and because the sale, under which plaintiff claimed the title, was vitiated by such irregularities as sacrificed the property. The action which was before the supreme court was a bill in equity, instituted by the defendant after an unfavorable judgment in the ejectment suit, to secure title to the same property upon equitable terms, The court, in passing upon the case (page 249, 3 Wall., and page 71, 18 L. Ed.), makes use of the following language:

“He [defendant] chose rather to risk his whole defense in the impeachment of Brown’s [plaintiff’s] title for fraud, and because the sale was vitiated by-irregularities and the property sacrificed. Having failed before the jury, he is estopped from investigating the same matters in another jurisdiction. He waived his right to have the questions of fraud litigated. in the court of chancery when he presented it as a defense to the action at law, and the defense was legitimate and proper, for such questions of fraud and irregularity as were raised could he disposed of as well at law as in chancery. * * ⅛ In fact, the whole record shows that Blanchard claims equitable relief on substantially the same grounds and sustained by the same evidence that he relied on to defeat the action of ejectment. The decision in Miles v. Caldwell is therefore applicable. In that case, as in this, the question of fraud had been submitted to the jury, and determined against the complainant; and this court held that he was barred by the proceedings in ejectment, and could not raise anew in chancery the same questions that were heard at law.”

In tlie case of Foster v. The Richard Busteed, ioo Mass. 409, 1 Am. Rep. 125, the supreme court of that state, in considering the effect of a former judgment as a bar to a later action, says as follows:

“There is no essential difference between the effect of a decree In equity and of a common-law judgment in this respect A bill regularly dismissed upon the merits, where the matter has been passed upon, and the dismissal is not without prejudice, is a bar to future proceedings, either in equity or at law; and under similar circumstances a judgment at law is a bar to future proceedings in equity.”

To the same effect are the following cases: Kendall v. Stokes, 3 How. 87, n L. Ed. 506; Thompson v. Roberts, 24 Flow. 233, 16 L. Ed. 648; Baird v. U. S., 96 U. S. 430, 24. L. Ed. 703; Wilson's Ex’r v. Deen, 121 U. S. 525, 7 Sup. Ct. 1004, 30 K. Ed. 980.

We have carefully considered the cases relied upon by appellant’s counsel, and particularly the case of Wiggins Ferry Co. v. Ohio & M. R. Co., 142 U. S. 396, 12 Sup. Ct. 188, 35 E. Ed. 1055, and fail to find anything in them that militates against the principles already announced.

It is argued that defendant never brought suit against the English company to enforce the collection of the balance of the purchase price of the ranch, and therefore that the balance of the uncollected purchase price should have been considered in determining how much defendant received for the ranch. This argument is answered by the suggestion that the English company was organized for the sole purpose of buying the ranch in question, and that upon the failure of that venture necessarily became insolvent. This may or may not be so, but whether the plaintiffs in the action at law presented every fact working in their favor to establish their demand for the contingent compensation claimed by them or not is entirely immaterial. See cases supra. They had their day in court for that purpose, and it was their duty then and there, if ever, to bring forward all facts available in their behalf. If they failed to do so, they cannot now supply their omissions by instituting a new suit for the same demand, and subject the defendant to further cost and expense.

We may not, in the foregoing opinion, have expressly referred to each and all of the points suggested or argued by complainant’s counsel, but we have considered them all, and find nothing to disturb the conclusions hereinbefore reached.

The decree of the circuit court dismissing the bill is accordingly affirmed.