Campbell's Automatic Safety Gas Burner Co. v. Hammer

• Decision Date: 21 December 1915
• Citation: 153 P. 475,78 Or. 612
• Parties: CAMPBELL'S AUTOMATIC SAFETY GAS BURNER CO. v. HAMMER ET AL.
• Court: Oregon Supreme Court

153 P. 475

78 Or. 612

CAMPBELL'S AUTOMATIC SAFETY GAS BURNER CO. v. HAMMER ET AL.

Supreme Court of Oregon

December 21, 1915

In Banc.

Appeal from Circuit Court, Multnomah County; Robert G. Morrow Judge.

Suit by the Campbell's Automatic Safety Gas Burner Company, a corporation, against Bertha E. Hammer and others. From a decree of dismissal, plaintiff appeals. Reversed and decree entered for plaintiff.

This is a suit to enjoin the issuing of an execution, to restrain a levy thereunder, and to compel the cancellation of a judgment. The cause, being at issue, was tried upon a stipulation of facts to the effect: That on October 26, 1909 a written contract was signed by the plaintiff, a corporation, which for brevity will be called the Gas Company, and Henry G. Sonnemann, George C. Mourer, George R Baker, and George W. Morgan, whereby the Gas Company stipulated to issue, sell, and deliver to them 6,000 shares of its capital stock for $42,000. That this contract was subsequently modified by an oral agreement, by the terms of which the persons named were appointed sole agents of the Gas Company to sell its stock, and were to receive as their commissions all sums obtained therefor in excess of $7 a share. That Baker and Morgan with the consent of all the parties, transferred their respective interests in the contract to L. C. Hammer and H. G. Luker. That the two latter, Sonnemann and Mourer, sold 6,033 shares of stock at $10 a share, and turned over $60,330 in money and promissory notes, which instruments were received as cash by the Gas Company, which agreed to pay the commission at the maturity of the notes, but not conditioned upon their payment. That Hammer, Mourer, and Luker each assigned his individual interest in the commissions so earned to the defendants Bertha E. Hammer, Harry G. Mourer and Jesse C. Luker respectively, of which transfers the Gas Company was notified. That by consideration of the District Court of the United States for the District of Oregon, H. G. Sonnemann and others were adjudicated bankrupts, and the defendant A. A. Cunningham was elected trustee of their estates, and duly qualified for the trust. That the Gas Company paid all the commissions so earned, except $6,873.43, to collect which the persons entitled thereto entered into a contract with the defendant Robert J. Upton, an attorney, stipulating to pay him 30 per cent. of all sums of money that he might recover on account thereof. That he commenced an action in February, 1912, in the circuit court of the state of Oregon for Multnomah county, on behalf of Bertha E. Hammer and others against the Gas Company, to recover the remainder of the commissions. That before an answer was filed in that action Harry G. Mourer, one of the plaintiffs therein, in consideration of $500, settled with the Gas Company, representing to it that his attorney was a Mr. Blatchley, who was in Southern Oregon and did not expect to return, upon which statement the Gas Company relied, overlooking the fact that Mr. Upton was the attorney of record of all the adverse parties. That this latter attorney thereupon notified the Gas Company that he represented all the plaintiffs in that action, and that settlements with such clients should be made with him. That upon receiving such notice the Gas Company wrote Jesse C. Luker, with whom it had been negotiating, informing him of the notice so given, and received from him a letter, stating that Mr. Upton was not his attorney, but he believed his father, H. G. Luker, had employed Mr. Upton in the transaction of some business not connected with or relating to the commissions. That relying upon the statements contained in the letter, the Gas Company settled with Jesse C. Luker for the sum of $250. That neither Harry G. Mourer nor Jesse C. Luker has any property that is subject to execution. That after these settlements were made the Gas Company filed its answer in the action against it, but made no mention of the compromises which had been made with Mourer and Luker. That the action referred to was tried, and judgment rendered for the remainder of the commissions, or $6,873.43, against the Gas Company, which appealed therefrom, whereupon the judgment was modified as to the date from which the interest was to be computed, but in all other respects affirmed. Hammer v. Campbell's Gas Burner Co., 144 P. 396. That the mandate having been entered in the lower court, the Gas Company paid to the clerk of that court, for Bertha E. Hammer and A. A. Cunningham, trustee, one-half of the judgment and interest, and all the costs and disbursements, and thereupon requested Mr. Upton, who had received the money for his clients, to cancel the judgment, but he refused to comply therewith. That if the court should find Mr. Upton entitled to recover from the Gas Company the entire amount of his attorney's fee due from Harry G. Mourer and Jesse C. Luker, he should be awarded 30 per cent. of one-half of the judgment referred to; if, however, he should be found to be entitled to recover on Luker's account only, he should receive 30 per cent. of five-sixths of that part of the judgment; and if on Mourer's account only, he should be given 30 per cent. of one-sixth of that portion thereof.

Predicated upon this agreed statement of facts, the defendants' counsel moved to dismiss the suit on the grounds: (1) That there is no equity in the bill; (2) that the complaint does not state facts sufficient to constitute a cause of suit; (3) that no existence of a partnership or joint venture on the part of the defendants is alleged; (4) that no unsettled accounts are averred to subsist; (5) that no reason for an accounting is stated; and (6) that the prayer of the complaint does not seek any settlement of accounts. This motion was sustained, the suit dismissed, and the plaintiff appeals.

Jno. C. Jenkins, of Portland (Jenkins & Crawford, of Portland, on the brief), for appellant. Robert J. Upton, of Portland (Lisle A. Smith and James N. Davis, both of Portland, on the brief), for respondents.

MOORE, C.J. (after stating the facts as above).

The important question to be considered is whether or not the failure of the Gas Company to allege in its answer, in the law action to recover commissions, the settlements made with Harry G. Mourer and Jesse C. Luker, which compromises were consummated before that plea was interposed, precludes the Gas Company from maintaining this suit. The rule of res judicata, which was designed to promote the peace of society allows to each party a day in court, and demands that in the trial of issues between the same parties all matters of judicial controversy shall be settled and determined in the same suit or action, if such causes can legally be joined and an opportunity is afforded to plead them. As a corollary deducible from this legal principle, it follows that if a final judgment is rendered, or a decree given on the merits it is conclusive as to the rights of the parties and bars all subsequent legal proceedings between them upon the same cause of action or suit, not only as to the issues actually adjudicated, but also as to every other matter that might have been put forth and decided as relating thereto or necessarily associated therewith, either as a cause of action or a ground...