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Terminal Railroad Assn. of St. Louis v. Schmidt

Supreme Court of Missouri, Division Two
Sep 5, 1944
353 Mo. 79 (Mo. 1944)

Summary

In Terminal Railroad Ass'n of St. Louis v. Schmidt, 353 Mo. 79, 182 S.W.2d 79, loc. cit. 82, our Supreme Court announced the same general rule by declaring: "The allowance of damages upon the dissolution of an injunction is based upon the fact that the defendant has been compelled to employ aid and incur expense `in ridding himself of an unjust restriction, which has been placed upon him by the action of the plaintiff'.

Summary of this case from Kelder v. Dale

Opinion

No. 38935.

July 3, 1944. Motion for Rehearing or to Transfer to Banc, Overruled September 5, 1944.

1. INJUNCTIONS: Attorney and Client: Damages: Estoppel: Damages on Injunction Bond: Suspension of Defendant Attorney no Defense: Estoppel of Plaintiff. Plaintiff unsuccessfully brought an injunction action to prevent the payment of a judgment claimed to have been obtained through fraud. Noell, the attorney who had obtained the judgment, was made a defendant on the theory that he had an interest in the judgment and that he had participated in the fraud. After Noell was suspended from practicing law, he employed and paid another attorney to handle the case for his client on appeal. He was entitled to defend against the charges of fraud, and it was proper to allow expenses and attorney's fees incurred in such defense. And plaintiff, having made Noell a defendant, is estopped to assert that he was not a proper party.

2. INJUNCTIONS: Damages: Trial: Attorney and Client: Damages on Injunction Bond: Attorneys' Fees and Expenses: Jury Waived Case: Finding of Trial Court Conclusive: Allowances Reasonable. A proceeding for allowances of attorneys' fees and expenses as damages on an injunction bond was in the nature of a new, separate and independent controversy, and was triable by a jury. When a jury was waived, the finding of the trial court on conflicting evidence may not be disturbed on appeal. And the allowances were reasonable.

3. INJUNCTIONS: Damages: Attorney and Client: Damages on Injunction Bond: No Unreasonable Duplication of Attorneys. The interests of defendant Noell and those of the defendant executor were not identical, as defendant Noel had a separate interest in defending his character as a lawyer, so it was not unreasonable to employ different attorneys for each defendant and for the court to make allowances to each in awarding damages under the injunction bond.

4. INTEREST: Injunctions: Damages: Injunction Against Judgment: Damages on Injunction Bond: Interest on Judgment Interest Proper. When the injunction against the judgment was issued there was accrued interest of $7,293.24. This should be added to the principal amount of the judgment to determine the total amount upon which interest should be allowed in awarding damages on the injunction bond.

5. INJUNCTIONS: Damages: Injunction Against Judgment: Attorneys' Fees: Damages not Limited to 10%. Sec. 1673 R.S. 1939 does not prevent an allowance of attorneys' fees and expenses as damages on the injunction bond in excess of 10% of the amount of the judgment enjoined.

6. TRIAL: New Trial: Assignment Stricken as Impertinent: Appellant not Prejudiced. The trial court struck from the motion for new trial as "impertinent" an assignment that alleged excessive awards were assessed by the court for punitive purposes. It does not appear that appellant was prejudiced by such action.

Appeal from Circuit Court of City of St. Louis. — Hon. Robert L. Aronson, Judge.

AFFIRMED.

Joseph A. McClain, Jr., Arnot L. Sheppard, Louis A. McKeown and Albert E. Schoenbeck, for appellant.

(1) Respondent Noell is not entitled to have any allowance made for his counsel fees in the injunction suit herein, nor is he entitled to any interest on any fund, or any expenses incurred in connection with that action. By reason of his suspension from the practice of law between June 30, 1936, and April 4, 1940, his contract of employment with Ernest Aly became void, his attorney's lien upon Aly's cause of action was lost, he was unable to fulfill his contract of employment with Aly, he had no interest in Aly's judgment; and, as a consequence, no interest in the injunction suit. Therefore, he cannot be allowed any fees, interest or expenses in connection with that case. In re Noell, 234 Mo. App. 1162, 96 S.W.2d 213; Kimmie v. Terminal Railroad Assn., 126 S.W.2d 1197; Egan v. Waggoner, 41 N.D. 239, 170 N.W. 142; Davenport, Trustee, v. Waggoner, 49 N.D. 592, 207 N.W. 972, 45 A.L.R. 1126; In re Woodworth, 85 F.2d 50; Fletcher v. Krise, 120 F.2d 809. (2) Appellant is not estopped to take the position that respondent Noell cannot recover any counsel fees, interest or expenses, on the ground that it made him a party defendant in the injunction suit. The record facts are insufficient to show an estoppel by record. 31 C.J.S., sec. 5, p. 193 et seq. (3) The record facts fail to show an estoppel in pais. 19 Am. Jur., sec. 86, pp. 739-40; Blodgett v. Perry, 97 Mo. 263; Curtis v. Browne, 63 Mo. App. 431. (4) No action by appellant could nullify the suspension of respondent Noell, or revive his right to share in the proceeds of the Aly judgment, contrary to the holdings in In re Noell, supra, and Kimmie v. Terminal Railroad Assn., 126 S.W.2d 1197. (5) He was estopped by law to claim any interest in such proceeds, and, therefore, cannot plead estoppel against appellant. C.H. Albers Comm. Co. v. Spencer, 236 Mo. 608. (6) To permit him to plead estoppel against appellant would be contrary to public policy. 5 Am. Jur., sec. 249, pp. 410, 411. (7) Estoppel can never be used to create a cause of action. Its purpose is always to preserve rights, never to create them. Berry v. Mass. Bonding Ins. Co., 203 Mo. App. 459; McLain v. Mercantile Trust Co., 237 S.W. 506; National Fire Ins. Co. of Hartford, Conn., v. Winger, 106 S.W.2d 10; Shartel v. Mo. Utilities Co., 331 Mo. 337, 53 S.W.2d 395, 89 A.L.R. 607; Moss v. Hamilton, 303 Mo. 302; 10 R.C.L., sec. 25, p. 697; 19 Am. Jur., sec. 40, p. 639. (8) Under the doctrine of avoidable consequences the duty rested upon respondent Noell to disclaim any interest in the subject matter involved in the injunction suit, viz., the proceeds of the judgment in the Aly case, and thereby to minimize potential damages under the injunction bond. McCormick on Damages, p. 127; Lawson v. Brokmann, 116 Kan. 102; McCauley v. McElroy, 199 S.W. 317; Galbraith v. Thayer, 147 Miss. 536, 113 So. 180, 53 A.L.R. 288; 28 Am. Jur., sec. 345, pp. 519-520. (9) The allowances of fees, interest and expenses by the trial court are grossly excessive, are based upon improper and immaterial evidence, and are in violation of both statutory and case law. Some of the fees allowed herein were unnecessarily incurred and are not justified by the law. 28 Am. Jur., sec. 345, p. 519; 32 C.J., sec. 825, p. 478; Neiser v. Thomas, 46 Mo. 47; Crane v. Village of Roselle, 157 Ill. App. 595; Collins v. Sinclair, 51 Ill. 328; Hotchkiss v. Platt, 8 Hun, 46; 143 A.L.R. 685; 2 High, Injunctions (4th Ed.), sec. 1688, p. 1636. (10) The fees allowed by the trial court do not conform to the standard enunciated by the courts to be used in determining the amount of attorneys' fees allowed. 7 C.J.S., sec. 191, p. 1079; Trimble v. Kansas City, S. G. Ry. Co., 201 Mo. 372, 100 S.W. 7; Alexander v. Colcord, 85 Ill. 323. (11) The fees allowed by the trial court were based upon immaterial and improper evidence. Crane v. Village of Roselle, 157 Ill. App. 595; 43 A.L.R. 672; 7 C.J.S., sec. 191, p. 1080; 5 Am. Jur., sec. 198, p. 379. (12) A comparative analysis shows that the weight of proper evidence does not support the excessive fees allowed. 143 A.L.R. 718; Crane v. City of Roselle, 157 Ill. App. 595. (13) Approval of the exorbitant and unreasonable fees allowed by the trial court will set a public standard which will discourage or prevent individual citizens from seeking injunctions to which they may be justly entitled. (14) The sum released by the dissolution of the injunction in this suit, exclusive of interest and costs, was $40,000. Ten per centum of this sum would be $4000. Under our statutes there cannot be an allowance of damages upon a bond given in a suit to stop the collection of money, in excess of 10 per centum of the amount of money released by the dissolution of the injunction, exclusive of interest and costs. Therefore, any allowance in excess of $4000 was unwarranted by law and directly contrary to the statute. Sec. 1673, R.S. 1939; Kennedy v. Hammond, 16 Mo. 341; St. Louis v. Alexander, 23 Mo. 483; Hale v. Meegan, 39 Mo. 272; 2 Sutherland on Statutory Construction (3rd Ed.), sec. 3709, p. 255. (15) There can be no allowance of interest upon interest, or, in other words, compound interest, as the law frowns upon more than simple interest. Secs. 3228, 3229, R.S. 1939; 1 Sedgwick on Damages (9th Ed.), secs. 333-346; Cherokee Nation v. United States, 270 U.S. 476, 46 S.Ct. 428, 70 L.Ed. 694; Blanchard v. Dominion Natl. Bank, 130 Va. 633, 108 S.E. 649, 27 A.L.R. 78; Stoner v. Evans, 38 Mo. 461; Redman v. Hampton, 26 Mo. App. 504; Sanguinette v. Webster, 153 Mo. 343, 54 S.W. 563; Williams v. Carroll County, 167 Mo. 9, 66 S.W. 955; Clemen's Administrator v. Dryden's Administrator, 6 Mo. App. 597; 1 Sutherland on Damages (4th Ed. 1916), sec. 373. (16) The trial court erred in striking the tenth ground assigned in the motion for a new trial, on the ground of impertinence. The word "impertinence" in an equity proceeding means that the matter stricken is not pertinent to the issues; in law, that the matter is surplusage. The matter contained in the tenth assigment in appellant's motion for a new trial is anything but not pertinent to the issues. 49 C.J., sec. 81, p. 83; Stokes v. Farnsworth, 99 F. 836; Chew v. Eagan, 87 N.J. Eq. 80, 99 A. 611; Schenley Distillers Corp. v. Renken, 34 F. Supp. 678.

Cox, Blair Kooreman, Edgar Matthes and Harry S. Rooks for respondent, John J. Schmidt, Executor.

(1) Appellant's point (1) relates to respondent Charles P. Noell, exclusively, and is not briefed in this brief on behalf of respondent John J. Schmidt, executor. (2) The sufficiency of the evidence to sustain the judgment appealed from is not reviewable because appellant's abstract omits the injunction bond on which the proceeding is based (Exhibit A of Motion to Assess Damages, referred to at Abstract page 4 and page 71) and omits all the other exhibits of respondent Schmidt, namely, Exhibits B, C, D, E, F, G, H, I, J, K and L mentioned on pages 103 and 104 of the abstract, so that said abstract does not contain the evidence necessary for a review of the sufficiency of the evidence as required by Rule 13 of this court. Bueker v. Aufderheide, 345 Mo. 833, 136 S.W.2d 281; Rule 13, Supreme Court of Missouri. (3) Appellant's assignment that "Some of the fees allowed herein were unnecessarily incurred and are not justified by the law," does not present a reviewable issue since it does not specify with particularity the matter referred to as required by Rule 15 of this court. Jeck v. O'Meara, 343 Mo. 559, 122 S.W. 897; St. Louis v. Central Inst., 149 S.W.2d 790; Rule 15, Supreme Court of Missouri. (4) Appellant's assignment that "The fees allowed by the trial court do not conform to the standard enunciated by the courts to be used in determining the amount of attorneys' fees allowed," does not present a reviewable issue since it does not specify with particularity the matter referred to as required by Rule 15 of this court. Jeck v. O'Meara, 343 Mo. 559, 122 S.W. 897; St. Louis v. Central Inst., 149 S.W.2d 790; Rule 15, Supreme Court of Missouri. (5) Appellant's assignment that "The fees allowed by the trial court were based upon immaterial and improper evidence," does not present a reviewable issue since it does not specify with particularity the matter referred to as required by Rule 15 of this court. Jeck v. O'Meara, 343 Mo. 559, 122 S.W. 897; St. Louis v. Central Inst., 149 S.W.2d 790; Rule 15, Supreme Court of Missouri. (6) Appellant's assignment that "a comparative analysis shows that the weight of proper evidence does not support the excessive fees allowed," does not present a reviewable issue because, in this jury-waived case, the weight of the evidence is not reviewable, the trial court's findings of fact being conclusive, since there was substantial evidence in support thereof. Helmkampf v. Wood, 85 Mo. App. 227; Farasy v. Hindert, 110 S.W.2d 785. (7) This proceeding to assess damages on the injunction bond is in the nature of a new, separate and independent suit. Stine v. Southwest Bank, 98 S.W.2d 539. (8) It is triable to a jury as of right. Sec. 1673, R.S. 1939; Home Mutual Ins. Co. v. Baumann, 14 Mo. 74. (9) And it is reviewable, as such. Quinlivan v. English, 44 Mo. 46. (10) Appellant's assignment that "Approval of the exorbitant and unreasonable fees allowed by the trial court will set a public standard," etc., is mere argument not presenting a reviewable issue on appeal. (11) Section 1673, R.S. 1939, does not limit the total damages to 10 per cent of the amount enjoined, but merely limits the amount allowable as special damage for withholding the money as only one of the several items of allowable damage. Wabash R. v. McCabe, 118 Mo. 640, 24 S.W. 217; 4 Houts, Mo. Pleading Practice, sec. 1033, pp. 190-191. (12) Under the settled rule in Missouri as well as "the great weight of authority" attorneys' fees are allowed as damages on injunction bonds. "Injunctions," 28 Am. Juris., sec. 346, p. 520; Houts, Mo. Pleading Practice, sec. 1033, supra, and cases therein cited; Wabash R. v. McCabe, 118 Mo. 640, 24 S.W. 217. (13) By express provision of Section 1673, R.S. 1939, interest as damages on the amount of money impounded by operation of the injunction against the judgment is authorized in excess of the regular rate of 6 per cent, which the judgment itself carries, and permits allowance of damage for such impounding up to 10 per cent of the amount, and, therefore, the allowance in this case of interest as damages at the rate of 6 per cent per annum on the amount of the interest which had accrued on the judgment at the date of the granting of the temporary injunction, is authorized by and well within the limits of the statute. Wabash R. v. McCabe, 118 Mo. 640, 24 S.W. 217; 4 Houts, Mo. Pleading Practice, sec. 1033, p. 190; Sec. 1673, R.S. 1939. (14) Striking out the tenth specification in appellant's motion for a new trial was not error, but even if it had been error it would not be prejudicial since (a) the court had already some time theretofore assessed the damages, (b) the court actually did consider and rule on the merits of the stricken specification, and (c) specification No. 6 contains the same allegation for all necessary or proper purposes. Sec. 1228, R.S. 1939.

Hay and Flanagan and Edwin D. Franey for respondent Charles P. Noell.

(1) There is nothing in the case of Kimmie v. Terminal Railroad Association of St. Louis, 126 S.W.2d 1197, which bars the recovery by respondent Noell of the damages on the injunction bond. The Kimmie case was decided on principles of the law of contracts applicable to all contracts for personal services where compensation is contingent upon the achievement of a certain result, and not on any rule of public policy which would make it illegal for a client who was so disposed to compensate an attorney for partial performance of a contingent contract before the suspension of the attorney. There being no principles of public policy involved, it is no concern of appellant that Aly and his executor elected to compensate Noell for his services. 12 Am. Jur., sec. 273, pp. 819, 820. (2) Since Aly prior to his death had evidenced his intention to see that respondent Noell was paid for his services and had agreed in writing to the substitution of Judge Allen to handle the case on appeal after the suspension of Mr. Noell, Noell did have a substantial interest in the judgment for it represented the source out of which he was to be paid, and he was, therefore, justified in incurring expense to defend the injunction suit. Where an attorney employed to defend a suit is, after some progress, compelled by circumstances to retire from its charge and with the consent of the client engages the services of a substitute, who performs the duty, he may maintain an action for the whole services rendered. Houck v. Bridwell, 28 Mo. App. 644; Fenno v. English, 22 Ark. 170. (3) Appellant is in no position to say that Noell had no interest in the judgment which he was justified in protecting since both Aly and his executor were fully satisfied with Noell's performance and paid him for his services. If the parties to the contract are satisfied with the performance, a third party has no right to complain. 13 C.J., pp. 673, 674, sec. 767; Wells v. Hocking Valley Coal Co., 137 Iowa 526, 114 N.W. 1076; Continental Casualty Co. v. Carver, 14 P.2d 181; Salter v. Howard, 43 Ga. 601; Rich v. New York, C. H.R. Co., 87 N.Y. 382; Haskins v. Royster, 70 N.C. 601; Aalfo Co. v. Kinney, 105 N.J.L. 345, 144 A. 715; Martens v. Reilly, 109 Wis. 464, 84 N.W. 840. (4) Appellant, having joined respondent Noell as a party defendant to the injunction suit, may not now in order to escape liability for the damages sustained by him say that he was not a proper party and should never have been joined. A party will not be permitted to assume inconsistent positions in the same litigation. Bensieck v. Cook, 110 Mo. 173; Lilly v. Menke, 143 Mo. 137; St. Louis v. United Rys. Co., 263 Mo. 387; State ex rel. Boatmen's Bank v. Sewer District, 327 Mo. 594, 37 S.W.2d 905; Steinberg v. Merchants Bank of Kansas City, 334 Mo. 297; Andrews v. Glenville Woolen Co., 50 N.Y. 282. (5) Even if respondent Noell had had no interest in the subject matter of the injunction suit, he was still justified in incurring expense to defend the same since he was a party thereto, and would have been liable for costs if judgment had gone against him. Cooper v. Humes, 93 Ala. 280, 9 So. 341; Rosser v. Timberlake, 78 Ala. 162. (6) The amount of damages allowed respondent Noell for the fees of his attorney are not excessive. The nature and character of the case, the serious nature of the charge lodged against respondent Noell, the results accomplished and the time necessarily spent by his counsel in dissolving the injunction fully justify the allowance. All these factors are entitled to be taken into consideration in fixing the fee. 9 A.L.R. 237, and cases there cited. (7) In view of the gravity of the charge lodged against respondent Noell and the necessity of a vigorous defense on the facts, he was entitled to have his own counsel to represent him, and was not required to join with the other defendant in selecting one counsel to represent both. It has been held that where two or more defendants are enjoined and their interests are several, the liability on the injunction bond is several and the parties may proceed by separate motions for their damages on the injunction bond. Commission Co. v. Spencer, 236 Mo. 608. (8) The trial court did not err in allowing attorneys' fees as damages on the injunction bond in excess of 10 per cent of the amount due on the Aly judgment. Section 1673, Revised Statutes of Missouri 1939, does not limit the amount of attorneys' fees allowed to 10 per cent of the amount released by the dissolution of the injunction. Wabash Railroad Co. v. McCabe, 118 Mo. 640. (9) The court did not err in allowing as an item of damages on the injunction bond interest on the amount of interest due on the Aly judgment at the time the respondents were enjoined from taking steps to collect it for the period the injunction was in effect, for whenever the direct and proximate effect of an injunction wrongfully issued is to deprive the party enjoined of the use of money which belongs to him, interest thereon at the legal rate for the time the money is impounded may be recovered by way of damages in an action on the injunction bond. 28 Am. Jur. 525, sec. 351. (10) The item of $1250 allowed to respondent Noell for the services of his expert witness, Dr. Francis Barnes, was reasonable. There is no doubt Dr. Barnes spent a great deal of time on this case and is entitled to be compensated accordingly.


Upon the motions of Charles P. Noell and John J. Schmidt, the executor of the estate of Ernest W. Aly, damages in the sum of $14,778.77 were assessed on the Terminal Railroad's injunction bond. The railroad appeals from the allowance and the questions presented are the propriety and size of the awards.

The background of the present litigation is that on October 25, 1929, Ernest W. Aly, a Terminal switchman, was run over by an engine and both legs were cut off above the knees. In January, 1930, he entered into a one-third contingent fee contract with an attorney, Charles P. Noell, and a suit was instituted against the Terminal in which it was claimed that Aly's injuries were caused by the Terminal's violation of the Federal Boiler Inspection Act. It was alleged that as Aly boarded a backing engine the footboard on the tank slipped about an inch and he was thrown forward and from the engine. The first trial resulted in a verdict for the defendant which, upon Aly's appeal, was reversed and remanded. Aly v. Terminal Railroad Ass'n., 336 Mo. 340, 78 S.W.2d 851. On the second trial Aly had a verdict of $55,000.00. He refused a remittitur of $25,000.00 and a new trial was granted. On the third trial Aly had a verdict of $85,000.00 which was affirmed on May 8, 1938, after a remittitur of $45,000.00. Aly v. Terminal Railroad Ass'n., 342 Mo. 1116, 119 S.W.2d 363 — certiorari denied 305 U.S. 655, 59 S.Ct. 251, 83 L.Ed. 424. All of the trials were conducted by Noell. In each of the trials the principal issue was whether there was a defect in the footboard, that is, whether it could and did slip.

On January 13, 1939, Aly shot and killed himself, after writing four letters, one to his lawyer, one to a brother and two to employees of the Terminal, in which he said "your Co. does not owe me any thing on my case as it was faked fixed and [81] framed." Upon the Terminal's application the mandate in the principal case was stayed and the Terminal instituted a suit against Aly's executor, Schmidt, and his attorney, Noell, to enjoin the collection of the affirmed judgment alleging that it had been obtained by fraud. The trial court found that Aly wrote the letters and killed himself out of fear and hatred of his wife and with the purpose of destroying the judgment so that she would never enjoy any part of it. That judgment against the Terminal was affirmed in 1942. Terminal Railroad Ass'n. v. Schmidt, 349 Mo. 890, 163 S.W.2d 772. The damages involved in this appeal were assessed upon the Terminal's bond in that suit.

The damages assessed consist of two items, $6371.48 on behalf of Noell and $8407.29 on behalf of Schmidt. $4500.00 of Noell's allowance was for his counsel's fee in defending and representing him in the injunction suit, $94.91 was for expenses, $526.57 was for interest and $1250.00 was for the expert medical fees of Dr. Barnes. The Terminal contends that Noell is not entitled to an allowance for fees and expenses incurred by him in opposing the issuance of the injunction. The basis of its contention is that during the pendency of the Aly case (that is after it was tried the last time, January 8th to the 10th, 1936, and before it was appealed) Noell was suspended from the practice of law for the period of two years and until the costs of the proceeding against him were paid — which was from June 30, 1936, to April 4, 1940. In re Noell, 234 Mo. App. 1162, 96 S.W.2d 213. Furthermore, during the time of the Aly case Noell had represented Kimmie who discharged him and employed other counsel after he was suspended and after there had been two trials and two appeals. Kimmie v. Terminal Railroad Ass'n., 334 Mo. 596, 66 S.W.2d 561; Kimmie v. Terminal Railroad Ass'n., 337 Mo. 1245, 88 S.W.2d 884. The Terminal then settled Kimmie's case and a consent judgment was entered and $15,000.00 was paid into court in order that it might be determined whether Noell was entitled to a fee. On February 8, 1939, eighteen days after the injunction suit was filed, it was held that Noell was not entitled to a fee, either on his contract or for the reasonable value of his services in the Kimmie case. The analogy of a lawyer's voluntarily abandoning his client and his cause was applied to his suspension for misconduct and it was held that Noell could not continue to represent Kimmie and, therefore, could not recover for his services. Kimmie v. Terminal Railroad Ass'n., 344 Mo. 412, 126 S.W.2d 1197; Annotation 45 A.L.R. 1135. Because of these facts, the suspension and the Kimmie case, it is urged that Noell did not and could not have any further interest in the Aly judgment, could not have a fee from Aly and could not be injured by the injunction suit and, therefore, is not entitled to damages on the injunction bond. It is said that Noell should have disclaimed any interest in the Aly judgment and thereby minimized the damages on the injunction bond.

In all the cases upon which the Terminal relies, including the Kimmie case, the suspended lawyer had not been paid and he or someone on his behalf sought to enforce his claim for fees by suing on his contract or in quantum meruit and in each case it was held that he had forfeited any and all right to compensation by his own voluntary misconduct. Eagan v. Waggoner, 41 S.D. 239, 170 N.W. 142; Davenport v. Waggoner, 49 S.D. 592, 207 N.W. 972, 45 A.L.R. 1126; In re Woodworth, 85 F.2d 50; Fletcher v. Krise, 120 F.2d 809. But in this case the facts are that Aly did not discharge Noell or employ other counsel. Noell successfully tried Aly's case and after he was suspended, and with Aly's written permission, Noell employed and paid Judge William H. Allen to represent Aly in this court on the appeal. When the injunction suit was affirmed the Terminal paid in excess of $55,000.00 in satisfaction of the judgment and Noell's name was included in its check of payment. The executor of Aly's estate paid Noell a fee of more than $18,000.00, one-third of the sum recovered. The Probate Court of St. Francois County, in which Aly's estate was in process of administration, approved the payment of the fee upon the application of the executor and no one ever directly questioned the payment. Noell's right to a fee in the Aly case was not involved in the Kimmie case. The Kimmie case did not determine or pass upon the propriety of his acceptance of a fee from the Aly judgment. Neither is Noell's right to or the propriety of his acceptance of the fee from the Aly judgment involved in or determinable in this controversy other than collaterally and abstractly. We may determine the "particular instance only when it is presented to the court as prescribed by law." Riggs v. Moise, 344 Mo. 177, 183, 128 S.W.2d 632, [82] 635; State ex rel. McManus v. Muench, 217 Mo. 124, 117 S.W. 25.

It is said that the action of the Terminal in making Noell a party to the injunction suit could not nullify his suspension or revive his right to a fee or estop it from contending that he did not have a right to defend the injunction suit. But even assuming that Noell was not entitled, by reason of his suspension and the Kimmie case, to a fee from the Aly judgment it does not follow that he was not entitled to defend the injunction suit nor that he was not and could not be damaged by its unsuccessful prosecution. The Terminal instituted the injunction suit eighteen days before the Kimmie case was decided in this court. Noell's right to and the propriety of his acceptance of a fee by reason of his suspension was not an issue even in that cause. The Terminal sought to enjoin the collection of Aly's judgment on the ground that it had been procured by fraud. The charge was that the principal case had been "fixed faked and framed." The Terminal made Aly's executor, Schmidt, and Noell parties defendant to the injunction suit. An examination of the record and briefs in the injunction suit (which we judicially notice, Bushman v. Barlow, 321 Mo. 1052, 15 S.W.2d 329) reveals that the charge was that Aly knowingly and falsely testified that the footboard moved or shifted. It was charged and one of the Terminal's counsel testified that Noell told him that "if I ever have another case involving a footboard, it will never move sideways." From this testimony and Aly's letters that the case was "fixed faked and framed" it was argued that "the court must find that a concoction and fabrication of the case obtained." In short it was the position of the Terminal, in the injunction proceeding, that Noell was a party to and participated in the alleged fraudulent procurement of Aly's judgment. It is our view, aside from any principles of estoppel against the Terminal and aside from any pecuniary interest Noell may have had in Aly's judgment, that it was not only his right but his duty to defend against the imputation that he as a lawyer participated in the procurement of a judgment by fraud. It is even doubtful that the appellant should now be permitted to question whether Noell was a proper, necessary or injured party to or by the injunction suit since it voluntarily made him a party and it has been decided that it had no right to the injunction. Andrews v. Glenville Woolen Co., 50 N.Y. 282; Bensieck v. Cook, 110 Mo. 173, 19 S.W. 642. The allowance of damages upon the dissolution of an injunction is based upon the fact that the defendant has been compelled to employ aid and incur expense "in ridding himself of an unjust restriction, which has been placed upon him by the action of the plaintiff." 2 High, Injunctions, Sec. 1688; Farasy v. Hindert (Mo. App.), 110 S.W.2d 785. Then too had he not defended he might have become liable for costs had judgment gone against him and that would be some justification for defending the action. Cooper v. Hames, 93 Ala. 280, 9 So. 341; Rosser v. Timberlake, 78 Ala. 162.

It is said that under the doctrine of avoidable consequences the duty rested upon Noell, immediately after notice from the Kimmie case that he was not entitled to a fee, to disclaim any interest in the subject matter of the injunction suit and thereby minimize the damages. What we have just said disposes of this contention. But even so, should he? Had he disclaimed any pecuniary interest in the judgment what would have become of the charge of his having participated in fraudulently procuring it? The appellant says that had he disclaimed the cause would not have proceeded against him. But it is just as reasonable, by the same token and for the same reasons to say that had the appellant dismissed its cause as to him he would have disclaimed any interest in the judgment. At least its action in so doing would have tended to minimize the damages.

As to the damages assessed it is urged that they are exorbitant and unreasonable, that they do not conform to the standards enunciated by the law to be used in determining the amount of fees and that the weight of the evidence does not support the allowances. It is urged that some of the fees were unnecessarily incurred and for that reason are not allowable as damages. There can be no doubt but that an attorney is only entitled to fees which are fair and just and which adequately compensate him for his services. The fees allowed must be just to the lawyer and just to his client and in this type of a proceeding exorbitant and unreasonable allowances cannot be approved. [83] Scheufler v. Continental Life Ins. Co., 350 Mo. 886, 169 S.W.2d 359; 2 High, Injunctions, Sec. 1688; 32 C.J., Sec. 825, p. 478. But some consideration of the nature of the proceeding before us disposes of most of the appellant's objections. A proceeding for the assessment of damages on an injunction bond "is in the nature of a new, separate and independent controversy." Stine v. Southwest Bank of St. Louis (Mo. App.), 98 S.W.2d 539; Laumeier v. Sammelmann, 218 Mo. App. 468, 279 S.W. 249. It is triable, under the statute, by a jury. When a jury is waived, as it was in this instance, the right to damages and their amount is tried by the court. Mo., R.S.A., Sec. 1673; Quinlivan v. English, 44 Mo. 46. No declarations of law were requested or given and the court's award on conflicting, or in some instances uncontradicted, evidence cannot be disturbed by us. Farasy v. Hindert, supra; Richards v. Earl, 345 Mo. 260, 133 S.W.2d 381; Laughlin v. Boatmen's National Bank of St. Louis (Mo.), 163 S.W.2d 761.

For example, on behalf of Noell, the court allowed Dr. Barnes $1250.00 as a medical expert. One of the questions involved in the injunction suit was Aly's sanity. Mr. Hay testified that Dr. Barnes' services were necessary to a proper and adequate defense of the injunction suit. Dr. Barnes examined the records in the previous Aly cases, he conferred with and advised the attorneys, attended the hearings and testified in the injunction suit. In this proceeding he testified that his services were reasonably worth $2081.51. There is no evidence in this record that Dr. Barnes' services were not necessary. There was no evidence, other than that of Dr. Barnes, as to the value of his services and we cannot arbitrarily say that the allowance to him was unreasonable.

Mr. Hay was employed by and represented Noell in the injunction suit. Noell agreed to pay him a reasonable fee. He familiarized himself with the previous Aly cases and conferred with Noell, frequently. He made trips to Blackwell and investigated the circumstances of Aly's death. He conferred with Edgar and Matthes at DeSoto, one of Schmidt's firms of lawyers. He conferred with Dr. Barnes, with Mrs. Aly's lawyers. He prepared Noell's answer and prepared himself for the trial. The injunction suit was tied over a period of about seven days. So far as Mr. Hay was concerned the case involved Noell's standing and status as a lawyer as well as saving the judgment. Mr. Hay cross-examined most of the witnesses. Four eminent lawyers appeared for the Terminal, Mr. T.M. Pierce, Judge Walter N. Davis, Mr. Arnot L. Sheppard and Mr. Wm. A. Thie. The case was "hotly" contested. Mr. Hay briefed and argued the case for Noell and argued it a second time on re-hearing. Even the argument in this court was bitter and acrimonious. Mr. Hay says he spent a total of thirty days on the case and was reasonably entitled to a fee of $5000.00. Testifying for Mr. Hay, Mr. Eagleton thought $5000.00 most reasonable. Judge Fred L. Williams thought $3750.00, exclusive of something for defending the character of a lawyer, a proper sum. The court allowed for his services, $4500.00.

Schmidt, Aly's executor, employed Edgar and Matthes of DeSoto and Judge James T. Blair and Mr. Harvey Cox of St. Louis to represent him. Senator Matthes was employed the day Schmidt was ordered to show cause. He consulted with Mr. Hay, reviewed the original cases, prepared and filed the original return, attended the taking of depositions in DeSoto, attended parts of the hearings, made seven trips to St. Louis and devoted ten full days to the case. He thought $1500.00 to $1800.00 a reasonable fee for the services of Edgar and himself. Mr. Wilbur Schwartz thought $1500.00 reasonable for their services. The court allowed them $1200.00. Mr. Harvey Cox and Judge Blair detailed the nature of their services. In addition to studying the records in the previous Aly cases, conferring with lawyers and others and preparing the case for trial they investigated the $2000.00 bond the Terminal had filed and after a hearing got the bond raised to $60,000.00 and a new surety. They prepared a new return for Schmidt. They took part in and attended the trial. In minute detail Judge Blair narrated the work he had done in briefing the case and preparing it for trial. He spent two hundred ninety-nine hours on the case. Mr. Cox and Judge Blair thought they were reasonably entitled to $7500.00. Mr. Schwartz and Mr. Duggan thought they were entitled to that sum. The court allowed them $6000.00.

The facts of the nature and extent of the lawyers' services are not disputed by the Terminal. Mr. John J. Marsalek, Mr. Clark M. Clifford and Mr. Forrest Hemker testified as experts, however, that total fees [84] to all the lawyers for all the services in the respective sums of $4000.00, $5500.00 and $5000.00 would be reasonable.

The appellant admits that the respondents' attorneys obtained beneficial results but contends that it was not proper for the court to consider Senator Matthes' seven trips to St. Louis, and the testimony as to the acrimonious atmosphere in which the case was tried and argued. It is said that the total allowances were too disproportionate to the sums involved. The appellant says the lawyers' responsibilities were not great or unusual and that the legal problems involved were not difficult or complicated. The record in the injunction suit of over eight hundred pages, the Terminal's briefs of over one hundred thirty pages and the reports of the various Aly cases would indicate that the case was difficult and complicated, indeed, and the responsibilities grave. But even so, and disregarding the atmosphere in which the case was tried and Senator Matthes' seven trips to St. Louis, we cannot say, in view of the evidence that the allowance of attorneys' fees in the total sum of $11,700.00 and expenses in the total sum of $1497.06 is unreasonable. Farasy v. Hindert, supra. There is no inflexible rule for determining the reasonableness and size of attorneys' fees (7 C.J.S., Sec. 191, p. 1079), but considering the character and extent of the services in this case, the intricacy, novelty and difficulty of the case, the time consumed, the ability and eminence of counsel employed by all the parties, the amount involved, the magnitude of the cause to the parties and the results obtained (and there is no indication that the trial court considered any other elements) we think the allowances reasonable. Annotations, 143 A.L.R. 672, 725; 9 A.L.R. 237.

It is urged that the interests of Schmidt, the executor, and Noell, the attorney, were identical and, therefore, it was unreasonable and a duplication of services to employ two different groups of attorneys for the two parties and two firms for the executor. It is said that their fees should have been based on the value of their services as a whole and divided among the respective lawyers. It is true, in an injunction proceeding, that a defendant may not employ an unreasonable number of attorneys nor compel the plaintiff to pay for a duplication of services merely because he successfully defended the injunction. 32 C.J., Sec. 825, p. 478; Neiser v. Thomas, 46 Mo. App. 47; Crane v. Village of Roselle, 157 Ill. App. 595. There was some duplication of services in this case. However, each of the groups of lawyers testified that they performed various and different services. But more important in this case is the fact that Noell's interests and the executor's interests were not identical. They were identical in that it was to their mutual advantage to save the judgment. They were the same in that it was charged that the judgment had been procured by fraud. But as we have indicated Noell had a separate and further interest, apart from the judgment itself, in defending his character as a lawyer. Had he followed the appellant's suggestion and disclaimed any interest in the case or had the executor become antagonistic their interests might have conflicted. It is possible for each of the defendants in an injunction suit to suffer injuries different in nature and degree. C.H. Albers Commission Co. v. Spencer, 236 Mo. 608, 139 S.W. 321. Whether more lawyers than were reasonably necessary had been employed was considered by the trial court and we cannot say that its view of the matter was wholly unreasonable. Neiser v. Thomas, supra; 32 C.J., Sec. 825; 2 High, Injunctions, Sec. 1688.

On the day the injunction was issued, January 21, 1939, accumulated interest in the sum of $7,293.24 was due on the $40,000.00 judgment. In assessing damages the court allowed not only interest on the principal sum but interest on the accumulated interest from the date of the injunction in the sum of $1579.71. It is urged by the appellant that this is an allowance of interest on interest, or compound interest, and never allowable as damages. 1 Sedgwick, Damages, Sec. 345. But obviously the accumulated interest was a sum due the day the injunction was issued. And when the effect of the injunction is to unjustly deprive the party enjoined of the use of money which belongs to him "interest thereon at the legal rate, for the time the money is impounded, may be recovered by way of damages." 28 Am. Jur., Sec. 351; C.H. Albers Com'n Co. v. Spencer, supra. When the collection of a judgment has been enjoined "in estimating damages after the dissolution of an injunction against a judgment, they should be computed upon the aggregate [85] amount of principal, interest and costs due at the time the injunction took effect." 2 High, Injunctions, Sec. 1666, p. 1617.

Mo., R.S.A., Sec. 1673, provides that "upon the dissolution of an injunction . . . damages shall be assessed . . . but if money, or any proceedings for the collection of any money or demand, shall have been enjoined, the damages thereon shall not exceed ten per cent on the amount released by the dissolution, exclusive of legal interest and costs." It is urged that the allowances in this case, being in excess of ten per cent of the $40,000.00 judgment, violate the provisions of this statute. The appellant contends that the language of the statute is plain and unambiguous and means exactly what it says. It is conceded that Wabash Railroad Co. v. McCabe, 118 Mo. 640, 24 S.W. 217, holds that a successful defendant in an injunction suit may suffer injuries and recover damages other than and in addition to the injury and damage of not being able to collect and use the money or demand justly due. But it is urged that the statute is plain and the case distinguishable. There the defendant and his attorney were restrained from collecting a judgment of $15.70. The injunction was dissolved and on motion for damages $25.00 was allowed as an attorney's fee. The appellant relied on the statute. The court said, 118 Mo. l.c. 645:

"When the collection of money under execution is restrained there is nothing to depreciate in value, and for that reason the law fixes the measure of damages at ten per cent on the amount released, so that the damages in that regard may be ascertained by some certain and definite rule, and thereby made easy of ascertainment; there is nothing else to which damages can attach in such case, especially before levy on property. Certainly it was never intended by the legislature that the same rule should not apply in both cases with respect of damages sustained for necessary expenses and attorney's fees in and about defending the suit of injunction."

In short, the statute does not by its terms limit the damages recoverable on an injunction bond to ten per cent of the sum impounded. If other injuries and losses are sustained, such as being compelled to employ counsel, they are recoverable. 4 Houts, Pleading Practice, Sec. 1033, pp. 190-191.

The appellant's tenth assignment in its motion for a new trial was that "the grossly excessive amounts allowed for attorneys' fees and expenses show clearly a purpose on the part of the court to punish plaintiff rather than to compensate the defendants." The trial court was of the view that this assignment was "impertinent" in the sense that it indicated and meant that the court had wilfully departed from its duty and struck the assignment from the motion. The appellant contends that "impertinent" means, in equity parlance, "surplusage" or "not pertinent" and that there was not such an affront to the court as is connoted by the term "scandalous" and, therefore, the court was in error in striking the assignment. Other than that it is not pointed out how or wherein it was error or how the appellant is prejudiced by it except its repeated argument that the allowances were grossly excessive. What we have said indicates that the allowances were all reasonable and proper and we see no occasion for considering the matter further.

The judgment is affirmed. Westhues and Bohling, CC., concur.


The foregoing opinion by BARRETT, C., is adopted as the opinion of the court All the judges concur.


Summaries of

Terminal Railroad Assn. of St. Louis v. Schmidt

Supreme Court of Missouri, Division Two
Sep 5, 1944
353 Mo. 79 (Mo. 1944)

In Terminal Railroad Ass'n of St. Louis v. Schmidt, 353 Mo. 79, 182 S.W.2d 79, loc. cit. 82, our Supreme Court announced the same general rule by declaring: "The allowance of damages upon the dissolution of an injunction is based upon the fact that the defendant has been compelled to employ aid and incur expense `in ridding himself of an unjust restriction, which has been placed upon him by the action of the plaintiff'.

Summary of this case from Kelder v. Dale
Case details for

Terminal Railroad Assn. of St. Louis v. Schmidt

Case Details

Full title:TERMINAL RAILROAD ASSOCIATION OF ST. LOUIS, a Corporation, Appellant, v…

Court:Supreme Court of Missouri, Division Two

Date published: Sep 5, 1944

Citations

353 Mo. 79 (Mo. 1944)
182 S.W.2d 79

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