Brown v. Ginn

• Decision Date: 13 May 1902
• Citation: 66 Ohio St. 316,64 N.E. 123
• Parties: BROWN v. GINN.
• Court: Ohio Supreme Court

64 N.E. 123

66 Ohio St. 316

BROWN v. GINN.

Supreme Court of Ohio.

May 13, 1902

Error to circuit court, Cuyahoga county.

Action by Frank H. Ginn against Marcus M. Brown. Verdict for plaintiff was affirmed by the circuit court, and defendant brings error. Reversed.

The defendant in error commenced an action in the common pleas of Cuyahoga, against the plaintiff in error, to recover upon eight causes of action, the first of which is in words and figures following, to wit: ‘ Now comes the plaintiff herein, Frank H. Ginn, trustee, and for his cause of action against the defendant, Marcus M. Brown, says: That there is due him as such trustee, from said defendant, the sum of $100.75 for work and labor performed by Peter J. De Witt, for and at the request of said defendant, from August 29, to November 21, 1896, in and about the construction of a dwelling house on Euclid Heights, Cleveland, Ohio, which amount he claims, with interest thereon, from November 21 1896.’ Each of the other seven was like unto this save as to the name of the person by whom the work was done and the amount and date. The total demanded was $921.59, with interest. The answer alleged that the plaintiff is not the real party in interest; that he is not the owner of any of the claims set up in the petition, but is merely the attorney who has the several claims for collection, and has no interest in them other than that. Payment of the several claims to the persons named prior to any assignment to plaintiff was also pleaded. Plaintiff's reply denied all of the allegations of the answer. To maintain the issues on his part the plaintiff below offered himself as a witness in his own behalf as trustee, and testified as follows: ‘ My name is Frank H. Ginn; I am an attorney at law, and am the plaintiff in this action. The signature to this paper which I hold in my hand, ‘ Frank H. Ginn, Trustee,’ is my signature, and Joseph O'Keefe, James Corrigan, Herman Roseman, George F. Moore, Frank Laraway, James Hogan, Peter J. De Witt, and Joseph Hedges, whose names appear upon this paper, signed the same in my presence and handed the same to me,'-which paper was offered in evidence, and is as follows: ‘ Agreement made this 30th day of October 1897, between Frank H. Ginn, trustee, first party, and Joseph Hedges, James Hogan, J. Corrigan, Joseph O'Keefe, George Moore, Peter De Witt, Herman Roseman, John D. Smith, and Frank Laraway, or any of them that may sign this agreement second party, witnesseth that, whereas, the persons composing second party have claims for work and labor, in different amounts, against Marcus M. Brown, and are desirous of having said claims prosecuted for collection against said Marcus M Brown: Now, therefore, the persons composing second party, or any of them that may sign this agreement, hereby sell and assign to Frank H. Ginn, trustee, for the purposes hereinafter specified, severally, their claims against said Marcus M. Brown. In consideration thereof, said Frank H Ginn, trustee, agrees to prosecute said claim, by suit or otherwise, against said Marcus M. Brown, and, after deducting costs and attorney's fees, to account for any sum obtained from said Marcus M. Brown upon said claims, to said persons signing this agreement, in proportion as the claim of each may bear to the whole sum recovered from said Brown upon said claims. Witness our hands this 30th day of October, A. D. 1897. [Signed] Frank H. Ginn, Trustee. Joseph O'Keefe, James Corrigan, Herman Roseman, G. F. Moore, Frank Laraway, James Hogan, Peter J. De Witt, Joseph Hedges.’ And thereupon plaintiff rested his case. Defendant offered evidence tending to prove payment. Plaintiff gave in rebuttal evidence to controvert the new matter, and the cause was submitted. The jury thereupon returned a verdict for the plaintiff for $1,077.28, on which judgment was rendered, which was affirmed by the circuit court. To reverse those judgments the defendant below brings error.

Assignee of several accounts against same debtor is not trustee of express trust within statute.

Syllabus by the Court

1. A contract by which several accounts against the same debtor are assigned by the holders to another, termed a ‘ trustee,’ for the purpose of having the same prosecuted for collection by suit or otherwise, and the proceeds, after payment of costs and fees of the trustee for prosecuting the action, to be paid to the assignors in proportion as the claim of each may bear to the whole sum recovered, does not constitute such assignee the real party in interest within the purview of section 4993, Rev. St., so as to enable him to maintain an action in his own name upon such accounts; nor is he a trustee of an express trust within the meaning of section 4995, Rev. St.

2. A contract assigning several accounts for the purpose of collection, which gives to the assignee (an attorney) a contingent fee depending on success, to be deducted from the proceeds of a suit to collect the accounts, which suit is to be prosecuted by him in his own name and at his own risk and cost, and which also deprives the assignors of any right to control or compromise the suit, is against public policy as champertous, and is invalid.

Charles E. Pennewell, for plaintiff in error.

Blandin, Rice & Ginn, for defendant in error.

SPEAR, J. (after stating the facts).

The question at the threshold is whether or not the action is maintainable by the plaintiff below in his own name. Our statute (section 4993) provides that ‘ an action must be prosecuted in the name of the real party in interest,’ except as provided in the two following sections, and the pertinent provision of the exceptions is that ‘ a trustee of an express trust, a person with whom, or in whose name a contract is made for the benefit of another, or a person expressly authorized by statute, may bring an action without joining with him the person for whose benefit it is prosecuted.’ Section 4995. It is not supposed that any other provision of the statute aids the plaintiff below. If he is not the real party in interest then his right to maintain the action must rest upon one or the other of the two exceptions quoted. It would be difficult to conclude that he is the real party in interest when his relation to the accounts declared on is contrasted with that of the others who claim to have performed the labor and to have earned the sums sued for. Prior to the making of the contract he had no possible interest in the subject-matter. By the contract he acquired an apparent, beneficial interest to the extent of his fees for services yet to be rendered, and none other; that is, it was a contingent interest. If the effort to collect fails he loses compensation for the work done and the costs made by him, and the other parties to the contract, if bound by the result, lose their entire claims. If he succeeds he gets only compensation for his professional labor with immunity from costs, and they get the whole of what remains. It may be admitted that the plaintiff is a party in interest, but it seems hardly reasonable to assume that, in this situation, the plaintiff is the real party in interest, and we are of opinion that he is not. We are aware that the tendency of some courts has been to uphold actions, brought upon negotiable instruments, transferred for collection only, on the ground that the...