Stuart v. Hoffman & Co.

61 S.E. 757, 108 Va. 307, 1908 Va. LEXIS 35
CourtSupreme Court of Virginia
DecidedJune 11, 1908
StatusPublished
Cited by11 cases

This text of 61 S.E. 757 (Stuart v. Hoffman & Co.) is published on Counsel Stack Legal Research, covering Supreme Court of Virginia primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Stuart v. Hoffman & Co., 61 S.E. 757, 108 Va. 307, 1908 Va. LEXIS 35 (Va. 1908).

Opinion

Keith, P.,

delivered the opinion of the court.

The original hill in this case was filed by certain supply lien creditors of the William R. Trigg Company, shipbuilders, suing on behalf of themselves and all other creditors similarly situated, alleging the insolvency of the defendant company, and [308]*308asking the appointment of a receiver to take charge of its assets and administer the same under the orders of the court. Thereupon, numerous other supply liens were filed, and among them one by the Bucyrus Company, of Milwaukee, Wisconsin. At the time the bill was filed and the receiver appointed, the Trigg Company was engaged in the construction of a number of vessels for the United States, among them a certain sea-going suction dredge at a cost of $252,375. The Bucyrus Company furnished the Trigg Company, to be used in the construction of this vessel, certain pumping machinery, at a cost of $32,050. The rights of the parties growing out of this contract were the subject of controversy between the receiver and the creditors of the Trigg Company, and the Bucyrus Company, the latter claiming title to the pumping machinery, and therefore to the whole of its proceeds, which claim was controverted by the receiver and creditors of the Trigg Company. The United States Government filed a stipulation in the case, claiming the unfinished vessel and all machinery on hand applicable to its construction, agreeing to protect the creditors of the Trigg Company in any claim they might have in or to the property which was superior to the rights of the government; and thereupon an order was entered, directing the receiver to surrender possession of the unfinished dredge and certain materials applicable thereto, including the pumping machinery in controversy, to the United States, or their authorized agents. Subsequently a balance of $14,266.67 was ascertained to be due from the United States on this pumping machinery, and it was this sum, in the hands of the United States Government, which was the real subject of controversy in the case of Trigg Co. v. Bucyrus Company, reported in 104 Va. 80, 51 S. E. 174, from which the foregoing statement has been condensed.

The chancery court decided in favor of the Bucyrus Company, so that under that decree it took the entire fund in controversy, to-wit: $14,266.67. The creditors affected by this decision desiring to take an appeal from it, applied to the chancellor, who entered an order as follows:

[309]*309“It appearing to the court that it is to the interest of the creditors of the "William R. Trigg Company that said decree should be appealed from, and that it is proper that the expenses connected with said appeal should be borne by the fund in the hands of the receiver or under the control of the court in this cause, it is, on motion of said receiver, ordered that he be, and he hereby is, authorized and directed to take the necessary steps to procure an appeal from said decree at the expense of said fund.”

Accordingly, a petition for an appeal was prepared on behalf of the Trigg Company and others, and presented to this court. The petition is signed by Bickford & Stuart, Whitehurst & Hughes, J. Jordan Leake, as attorney for the Trigg Company, and Lilburn Myers, receiver; by A. W. Patterson, George Bryan, and T. C. Gordon. Bickford & Stuart seem to have represented the greater number of clients; and the certificate of error required in our practice was signed by William O. Stuart, of that firm.

An appeal was allowed, and, the rules of court permitting only two counsel to argue upon each side, the case was presented in this court by Stuart and Bryan. The decree of the chancery court was reversed, the claim of the Bucyrus Company was rejected, and the cause - was remanded for further proceedings to be had in accordance with the views expressed in the opinion of this court.

Thereupon Stuart, Bryan and Patterson filed their petition in which they claim, substantially, that it was through their services as attorneys that the claim of the Bucyrus Company was defeated, and the sum for which that company had obtained the decree in the chancery court “was preserved, not only to the clients of the said Bickford & Stuart, but to all of the creditors of the said William R. Trigg Company, subject to proper priorities, which said sum so preserved was, therefore, in fact ‘created’ for the benefit of the said creditors by the work and labor of your said petitioners, and which sum, except for the said appeal, would have been totally lost to them.”

[310]*310This petition with other papers in the cause was referred to a commissioner, to report what compensation, if any, should be allowed to said petitioners for their services in prosecuting said appeal, and any other matter deemed pertinent by the commissioner or which he may be requested by any party in interest so to report.

The commissioner filed a report in which he allowed the petitioners a fee amounting to 33 1-3 per cent, upon the sum of $14,266.67. Exceptions were taken to that report by a number of creditors, who state that they had been continuously represented by counsel, and that it was upon the .motion of the receiver that he was authorized and directed to take the necessary steps to procure an appeal from the decree complained of, at the expense of the fund, and that the amount of the fee, as ascertained by the report of the commissioner is excessive, and other grounds of exception which need not be noticed.

This court has had frequent occasion to. indicate its views upon the general subject of devoting funds under its control to the payment of services rendered by attorneys.

In Stoneburner v. Motley, 95 Va. 784, 30 S. E. 364, it was said: “There are cases which justify courts in making allowance for fees to counsel to be paid out of the funds under their control, a power capable of. great abuse and one which should be exercised with the most jealous caution and regard to the rights of the litigants. In most cases, it is better to leave those concerned to contract for the services rendered or received. But, while this is true, it is also true that, where parties to a suit, unrepresented by counsel, reap the benefit of services rendered in the progress of a cause, it is right and proper that those who receive the benefit, should be required to make just compensation for it. But we repeat, it is a power which is very capable of being abused and should, therefore, be cautiously exercised, lest thereby the administration of justice be brought into reproach.”

The last utterance of this court upon the subject was in [311]*311McCormick v. Elsea, 107 Va. 472, 59 S. E. 411, in which Judge Whittle, speaking for the court, said: “Except in rare instances, the power of a court to require one party to contribute to the fees of counsel of another party must be confined to cases where the plaintiff, suing in behalf of himself and others of the same class, discovers or creates a fund which enures to the common benefit of all; but the discretion vested in the court should never be exercised in a case where the interests of the party whose fund is sought to be charged are antagonistic to the party for whose benefit the suit is prosecuted.”

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Bluebook (online)
61 S.E. 757, 108 Va. 307, 1908 Va. LEXIS 35, Counsel Stack Legal Research, https://law.counselstack.com/opinion/stuart-v-hoffman-co-va-1908.