Smoot v. Shy

139 S.W. 239, 159 Mo. App. 126, 1911 Mo. App. LEXIS 530

• Court: Missouri Court of Appeals
• Decided: July 15, 1911
• Status: Published

Opinion

REYNOLDS, P. J.

Under an order of sale made by the circuit court of Pike county, in a suit for partition of real estate there pending, the property was bid off by one Simeon Shy, respondent here, for the sum of $8300, or at the rate of $41.59 an acre. On the report of the sale coming in, all the parties to the action objected to the confirmation of the sale on various grounds, and moved to set it aside. The motion was filed on behalf of all the parties of record to the action in partition, by plaintiffs here, a firm of lawyers who became attorneys of record in the cause so far as involved the matter' of the motion, although they had not previously been attorneys of record in the action for partition itself. Mr. Shy, who is the respondent in the case before us and who was the purchaser at that sale, appeared in opposition to that motion, being represented by his own attorneys. On hearing the motion was sustained and the sale was set aside. Whereupon Mr. Shy, through his attorneys, filed a motion to vacate that order and this latter motion being overruled, he prosecuted his appeal to the Supreme Court *of this state. There the cause coming on for hearing on that appeal, the appeal was dismissed. [See Thomas v. Elliott, Simeon Shy, appellant, 215 Mo. 598, 114 S. W. 987.] The action of the circuit court in setting aside the sale consequently stood, and a new sale being ordered, the property was again put up and on the second sale, Mr. Shy again being purchaser, it brought $13,500, or $67.50 per acre; that is an.increase of $5200 on the whole tract, or $26 per acre.

Plaintiffs, under their firm name of Smoot, Boyd & Smoot, had acted in the matter of fifing the motion to set aside the sale and in following the case to the-Supreme Court as attorneys for and in behalf of all the owners of the property. They did this under a contract with, all the parties to the partition, under and by the terms of which it was agreed that if they succeeded in bringing about an order disapproving the sale and in procuring an. order for resale, they should receive for their services, from each of the parties, out of the proceeds of the resale, twenty per cent of the amount the land brought at the resale in excess of the original price, that is in excess of $41.50 per acre, each interest agreeing to pay that out of its share. That is to say, plaintiffs took up the matter of setting aside the first sale and procuring an advanced price at a resale, on a contingent fee of twenty per cent of whatever the land should sell for on a resale, if it sold at a price in excess of $41.50 per acre, the owners of each one-seventh severally agreeing to this. There were seven interests in the estate, one of these sevenths being held by four minors, the Williams children, the contract on behalf of the minors with plaintiffs for their services as attorneys being made for them by their father, who, as it is alleged, was also their duly qualified and acting guardian and curator and authorized to make the contract. Another seventh was held by one Laura A. Elliott. The twenty per cent contingent fee which-plaintiffs were entitled to receive was $148.50 on each seventh interest, that sum being twenty per cent of the excess which each seventh interest realized in consequence of the resale over what would have been realized on the first sale. This resale, it should be added, was approved by the court and the proceeds paid out to the parties according to their respective interests. These matters being averred, it is further averred in the amended petition that while the cause was pending on the appeal taken by Shy to the Supreme Court, Shy had purchased the one-seventh interest of Laura A. Elliott and also the one-seventh interest of the minor children, it being averred that he had made that purchase from their guardian, Mr. Thomas Williams. Both of these parties, it is averred, had entered into the contract before named with these plaintiffs, the one for himself, the other for his children and wards. It is further averred that Shy-had made these purchases with full knowledge of the terms and conditions of the employment of these plaintiffs and that he was notified of the contract and the nature of the contract' existing between plaintiffs and Laura A. Elliott and Williams, as guardian, but that notwithstanding his notice and knowledge of the contract of employment and the terms and conditions thereof, Shy had received on a final1 distribution of the proceeds of the resale, the full shares of Laura A. Elliott and of the Williams children, as purchaser of their interests pending the appeal to the Supreme Court, which amount had been paid over to him by order of the circuit court, but had declined and refused to carry out the contract made by these two parties with plaintiffs and refused to pay them, their fee, as above, and that neither Laura A. Elliott nor the Williams children or their guardian had paid the fee of plaintiffs. It is averred that the contract between plaintiffs and the guardian and curator of the four Williams children had been duly made and entered into by and between plaintiffs and this guardian and that that contract was duly and legally made for and on behalf of the minors by their, father and guardian and curator. Plaintiffs demanded judgment against défendant Shy for the twenty per cent on the excess realized by these two parties, amounting to $297 from both of them.

The petition, being an amended one, was demurred to on the ground that it did not state facts sufficient to constitute a cause of action against defendant.

The demurrer was sustained and plaintiffs electing to stand on their amended petition, judgment followed in favor of defendant and against plaintiffs. Prom that judgment plaintiffs have duly perfected their appeal to this court.

The error assigned is on the action of the circuit court in dismissing the petition.

The, learned trial court seems to have proceeded on the theory that plaintiffs could not recover in this suit for lack of averment of a written notice provided by section 965, Revised Statutes 1909. If that is the theory upon which the court proceeded, it was error. While section 965 contains provisions for notification by the attorney of his claim to a lien on the cause of action, section 964 contains no such provision. That section seems to have been overlooked by the learned trial court. It is a very clear as well as positive enactment, reading: “The compensation of an attorney or counsellor for his services is governed by agreement, express or implied, which is not restrained bylaw. From the commencement of an action or the service of an answer containing a counterclaim, the attorney who appears for a party has a hen upon his client’s eause of action or counterclaim, which attaches to a verdict, report, decision or judgment in his Ghent’s favor, and the proceeds thereof in whosesoever hands they may come; and cannot be affected by any setlement between the parties before or after judgment.” It has been held in several cases by the Supreme Court and by our appellate courts, that while no provision is made by this section for the enforcement of the hen, the courts will look to the common law for an adequate remedy and that if “the judgment is paid in disregard of the attorney’s rights, one of his remedies is to move the court to set aside the satisfaction and award execution to the extent of his hen.” [See Wait v. Atchison, T. & S. F.R. Co., 204 Mo. 491, 103 S. W. 60; Young v. Renshaw, 102 Mo. App. 173, 76 S. W. 701; Yonge v. St. Louis Transit Co., 109 Mo. App. 235, 84 S.W. 184; Curtis v. Metropolitan St. R. Co., 118 Mo. App. 341, 94 S. W. 762.] But that is not the only remedy. While it is held in Wait v. Railroad, supra, that equity will interfere where there is no adequate remedy at law, and that one remedy is to move to set aside the satisfaction and award execution to the extent of his lien, that is not the only remedy that the party- defrauded of his right may have, as will be seen by reference to the above and following cases. Beyond all question, the statute provides that the proceeds of a judgment which have been paid over may be followed into the hands of the party who has received them; under the statute, the' lien follows the proceeds of the judgment “in whosesoever hands they may come.” It may even be enforced against the party who has made the settlement and who has disregarded the contract, even if that party has paid off the claimant, providing he had notice as provided by section 965. Here this defendant is the one who collected the share of the judgment awarded to his assignors; he is the one into whose hands the amount awarded has come; he is the one whom these plaintiffs are seeking to charge as the party who has the benefit of the legal services of these plaintiffs. They are undoubtedly entitled to do so under the provisions of section 964.

It is averred in the petition that the proceeds of this sale came into the hands of this defendant by virtue of his purchase of the two interests mentioned after the suit was brought, that is, after the motion was made for setting aside the sale. That motion was, under the facts here, the real matter in controversy involved in this particular case. To all intents it was the “commencement of an action”' within the provisions of section 964. Our Supreme Court has held in several cases, commencing with that of Taylor v. Transit Co., 198 Mo. 715, 97 S. W. 155, and down to Taylor v. St. Louis Merchants’ Bridge Terminal Ry. Co., 207 Mo. 495, 105 S. W. 740, that where the settlement is made of a clause of action after suit brought, notice to defendant of the hen is not necessary; that the attorney may sue for his fee and may hold any party into whose hands the proceeds reahzed on the judgment have come, without giving" notice. It is further there held that this hen attaches to and follows the proceeds derived by a chent from a settlement of a cause of action even though that cause never reaches a verdict or judgment and the suit was in the name of a third person. It is true that the attorneys who are plaintiffs in this case were not attorneys of record in the partition action itself when that was instituted, but beyond controversy, they were the attorneys of record in the only matter that appears to have been in controversy or in issue as between the defendant here and the parties to that litigation; that is, the controversy between this defendant Shy and the owners of the real estate as to whether the first sale made to him should stand. As to that controversy, these plaintiffs were the attorneys of record, representing the interests antagonistic to. defendant Shy and he is charged with notice of that fact. Mr. Shy was himself a party of record to that proceeding. If, by puchase of the interests, or by paying into court the whole amount of the bid to the use of the parties in interest in the partition proceeding, he did so without providing for the clearing off of the hen which under section 964 is given to those plaintiffs and of which he is charged with notice, he did so at his peril. Whether he paid into court the full amount of his bid or kept in his own pocket the amount due his assignors, is immaterial. In either case he paid off and discharged the judgment by which the proceeds of the land were distributed among the parties in interest, and when he did so, he did it at his peril as against the claims of these plaintiffs, who as attorneys of record in that proceeding are entitled to their hen. Under this view of the law the amended petition in this case states a cause of action and was not subject to the demurrer which was interposed.

It is said in argument by the learned counsel for respondent that it is not averred that the guardian of the Williams children was authorized by the probate court to make the bargain or contract with the plaintiffs as to their fees. That was not a necessary averment. It is alleged that the contract made between that guardian and plaintiffs “was duly and legally made for and on behalf of said minors, by their said father and guardian and curator.” That can only mean that it was made either under his authority as father and guardian or by authority of the probate court. In either case, or however that may be, this petition is not demurrable for lack of an averment of authority on the part of the guardian and father to make the contract. The authority is a matter of proof. The judgment of the circuit court in sustaining the demurrer and dismissing plaintiffs’ action is reversed and the cause remanded.

Nortoni and Caulfield, J.J., concur.