Brown v. Arnold

• Decision Date: 18 July 1904
• Docket Number: 2,049.
• Citation: 131 F. 723
• Parties: BROWN v. ARNOLD.
• Court: U.S. Court of Appeals — Eighth Circuit

131 F. 723

BROWN v. ARNOLD.

No. 2,049.

United States Court of Appeals, Eighth Circuit.

July 18, 1904

Syllabus by the Court

The assumption by an attorney at law of authority within the scope of the ordinary power of a practicing lawyer to act for a party to an action or suit is presumptive proof of actual authority to so act. The power assumed by an attorney at law in the conduct of an action is valid until disproved, not void until proved.

While the general rule is said to be that the authority conferred upon a lawyer by his retainer in an action or suit ceases when the judgment or decree is rendered, there are many exceptions to this rule, and in the actual practice of the law it is frequently disregarded. Some of the established exceptions are that after judgment or decree the authority of the attorney for the prevailing party to collect or enforce it, his authority to receipt for its proceeds and to discharge it, his authority to admit service of a citation to review it, and his authority to oppose any steps that may be taken within a reasonable time to reserve it, continue.

The retainer of an attorney at law to conduct an action confers upon him authority to stipulate with opposing counsel after the rendition of judgment in favor of his client, and after the expiration of the term of court, but within the time for procuring a writ of error, that the case shall abide the final decision of another action which involves the same question, and is conducted by the same attorneys.

The remedy at law which prohibits relief in equity must be 'as practical and efficient to the ends of justice and its prompt administration as the remedy in equity. ' An action for damages for the breach of a stipulation that an action at law which has passed to judgment shall abide the final decision of another action is not as practical and efficient to attain the ends of justice as a suit in equity for specific performance of the contract, where the final decision of the other action requires a reversal of the judgment. The action for damages does not furnish a remedy so adequate that it precludes relief in equity.

Laches is of the nature of estoppel. In the absence of extraordinary circumstances, such as many innocent purchasers, radical changes in condition or value, or loss of evidence, it is inapplicable to suits in equity within the time limited for the commencement of analogous actions at law.

This appeal challenges a decree which sustained a demurrer and dismissed a bill exhibited by Edwin F. Brown, receiver of the First National Bank of Sedalia against John S. Arnold, for the purpose of enforcing specific performance of a stipulation made between Parry L. Deweese the former receiver of this bank, and James T. Montgomery and William M. Williams, the attorneys for Arnold, to the effect that the case of Deweese, receiver, against Arnold should abide the result of the final decision of the case of Deweese, receiver, against Martha E. Smith and Sarah E Cotton. The bill set forth these facts: In 1889 Martha E Smith and Sarah E. Cotton were the owners of 100 shares of the capital stock of the First National Bank of Sedalia, and the defendant, Arnold, was the owner of 20 shares of that stock. Deweese, the receiver of the bank, brought separate actions against Smith and Cotton, Arnold, and about 35 other stockholders of that bank to recover a second assessment upon their stock, which had been levied by the Comptroller of the Currency. Montgomery and Williams had been retained by all these stockholders, and had made the same answer to the petition in each of the cases. The receiver made a motion for judgment in each of the cases, that motion was denied, the receiver declined to plead farther, and the court rendered a judgment that the plaintiff should take nothing by his action, and that the defendant in each case should recover his costs of the plaintiff. These judgments were rendered in 1899, and after the term of court at which they were entered had expired the attorney for the defendants in all the cases made a written stipulation that the receiver should sue out a writ of error from the judgment rendered in the case against Smith and Cotton, and that all the other cases against the other stockholders in which the judgments had been rendered in favor of the defendants should abide the result of the final decision in the case of Deweese, receiver, against Smith and Cotton. Thereupon such a writ of error was procured, and that judgment was reviewed and reversed by the Circuit Court of Appeals (106 F. 438, 45 C.C.A. 408), and its judgment was affirmed by the Supreme Court (23 Sup.Ct. 845, 47 L.Ed. 344). This affirmance was made on March 17, 1903. The attorney for the receiver lost the stipulation, and in March, 1903, he set forth the fact that the stipulation was made and had been lost, and moved the Circuit Court to redocket the case against Arnold, and allow it to stand according to the terms of the stipulation until the final decision in Deweese against Smith and Cotton, and this motion was denied. On August 15, 1903, the receiver exhibited the bill here in question, wherein he prays upon the facts which have been recited that the defendant be compelled to specifically perform the stipulation to the effect that the case against him should abide the final decision of the case against Smith and Cotton.

Wm. S. Shirk, for appellant.

P. H. Sangree, Henry Lamm, John Montgomery, Jr., and Lee Montgomery, for appellee.

Before SANBORN and VAN DEVANTER, Circuit Judges, and AMIDON, District Judge.

SANBORN Circuit Judge, after stating the case as above, .

Specific performance of the stipulation between the receiver and the appellee that the latter's case should abide the final decision of the action between the receiver and Smith and Cotton was denied by the Circuit Court upon three grounds: (1) Because the attorneys for Arnold had no authority to make the agreement evidenced by the stipulation on his behalf; (2) because the receiver had an adequate remedy at law; and (3) because his attorney had been guilty of laches. The case of Arnold, the case of Smith and Cotton, and the cases of 35 other stockholders whom the receiver had sued involved the same issue of law, which had been framed and tried by the same attorneys. Judgments had been entered in these cases in favor of the defendants. The term of court at which they were rendered had expired. Several months yet remained within which the receiver might lawfully procure writs of error to reverse these judgments. Then it was that the stipulation which lies at the basis of this suit was made and signed by the attorneys for all the parties to the litigation. It was a rational and salutary agreement. It saved to the litigants the expenses of the prosecution of 36 writs of error, and if it is performed it will produce without that unnecessary expense the same result that a review of all the cases and that additional expense would have effected. Obviously the performance of the agreement ought to be enforced unless some rule of law or of equity presents an insuperable obstacle.

It is said that the attorneys for Arnold were without authority to make the stipulation, because judgment had been rendered in his favor, and the term of court at which it was entered had expired; that when the judgment was recorded and the term closed the power of Arnold's attorneys to act for him derived from their original retainer, ceased, and a new warrant of attorney was indispensable to their authority to sign the stipulation. There are two answers to this contention. In the first place, if a new warrant of attorney was requisite after the judgment was rendered, the legal presumption is that the attorneys had obtained it. The bill contains an averment that they agreed to and signed the...