De Chambrun v. Campbell
| Decision Date | 16 February 1893 |
| Docket Number | 5,924. |
| Citation | 54 F. 231 |
| Parties | DE CHAMBRUN v. CAMPBELL et al. |
| Court | U.S. District Court — Northern District of New York |
Everett P. Wheeler and Wyllys Hodges for complainant.
Louis Marshall, for defendant Campbell.
David Thornton, for defendant Gesner.
This action was originally brought by Charles A. de Chambrun against the defendant Campbell, as trustee, alleging negligence, fraud and breach of trust, by which certain moneys and securities belonging to the complainant were diverted and lost. The judgment demanded is that the rights of the defendant Gesner in the trust be adjudged and determined, that thereafter a final accounting be had between the complainant and Campbell, and that the latter shall be adjudged to pay over to the complainant all moneys and securities found due on such accounting. Charles A. de Chambrun died September 13, 1891, and his son Pierre, as administrator, revived the action. The leading facts, out of which this controversy arises, so far as it is necessary to refer to them for the purposes of the present decision are as follows:
On the 20th of April, 1876, Charles A. de Chambrun entered into a contract with the French heirs of Stephen Jumel by which they appointed him their special attorney to take all necessary steps to recover property belonging to them in the city of New York. They bound themselves to pay to him 47 1/2 per cent. of all the gross sums recovered by him, for which amount he was given a lien and mortgage on all the property to which their right should be established. Very soon after the execution of this instrument De Chambrun commenced transferring to lawyers and others, whose assistance he considered necessary in his effort to recover the property various interests in the said 47 1/2 per cent. to secure them, respectively, for money advanced and services rendered or to be rendered. In some instances these agreements provided for a transfer of a percentage of De Chambrun's interest, in others a definite sum was named. To secure these interests a specific lien or mortgage upon De Chambrun's interest was given. The transfers, about which there seems to be no dispute, aggregated over $150,000 in interest. In other words, assuming the 47 1/2 per cent. to amount to $178,000 he had transferred interests therein amounting to over $200,000. In addition to these, other agreements, which have been successfully disputed upon the law or the facts transferred about 112 Er cent. of De Chambrun's interest in the property. There is no question that De Chambrun had incumbered his interest for much more than its value. If the liens created and acknowledged by him were all paid there could be no remainder coming to him. Soon after the agreement between the French heirs and De Chambrun proceedings to recover the land were commenced, and after years of arduous litigation, in which the defendant Campbell acted as one of the counsel for the French heirs, a compromise was effected which resulted in these heirs recovering real property of the appraised value of $152,525.43, which was conveyed in the spring of 1883 to a trustee for their benefit.
Various efforts to adjust the interests of the different claimants to this fund having failed, a suit was commenced in January, 1886, by Stephen M. Chester, as assignee of the claim of one of the lawyers who had been retained by De Chambrun early in the proceedings, to have the amount of his lien and of the other liens determined and paid. All of the parties interested in the said fund, including De Chambrun and Campbell, were made defendants. The complaint set out, in extenso, all the facts relating to The Jumel litigation, the fact that De Chambrun, Campbell and the other parties with whom De Chambrun had contracted, claimed to share in and to have liens upon the said property, and demanded judgment that the plaintiff's lien and all other liens, including those of De Chambrun and Campbell, be fixed and their priority determined. The defendants all filed answers fully stating the nature of their interest in the fund. So far as Campbell and De Chambrun are concerned their respective claims, which were entirely antagonistic, were set out fully and in detail. There can be no pretense that De Chambrun after reading the averments of Campbell's answer, which was served upon him, had any doubt as to the nature of Campbell's position.
He knew that Campbell claimed to recover for his own services, and also as assignee under various contracts which had been transferred to him, and that each of these claims was alleged to be paramount and superior to any interest De Chambrun might have in the fund. In short, De Chambrun knew that Campbell made the same claims and took the same position in that action that he takes in this. On the other hand De Chambrun, who was an attorney and appeared in person, denied that Campbell and most of the other parties to whom he had before given assignments and liens had 'any right, share, lien or interest in or upon the said lands and moneys.'
The attitude of De Chambrun and Campbell in the Chester suit was one of bitter hostility. Each knew that the other's position if sustained would defeat his own; and though both were defendants their respective contentions were fully as antagonistic as if they had occupied the position of plaintiff and defendant. It was, in short, a struggle for priority among claimants to an inadequate fund. The trial of the issues thus joined was referred to Mr. Hamilton Cole, a prominent and most reputable member of the New York bar. At the trial De Chambrun was represented by counsel who objected to the proof of Campbell's claim and proposed findings which, if adopted, would have entirely excluded Campbell from participation in the fund. The referee declined to find as De Chambrun requested and the latter excepted to his rulings. The referee reported in favor of various lien holders and fixed the order of priority among them, awarding the balance, if any, to De Chambrun. On this report a decree was duly entered. De Chambrun, among others, appealed from this judgment, but it was finally affirmed by the court of appeals. Chester v. Jumel, 125 N.Y. 237, 26 N.E. 297.
Pending the suit of Chester v. Jumel an action was commenced by Jean Albert Tauziede, and another, against the same defendants substantially, as in the Chester suit, praying that the trust property be sold, that the French heirs be paid the 52 1/2 per cent. due to them from the proceeds of such sale and that the remaining 47 1/2 per cent. be paid into court to be disposed of as the court might direct. Campbell and De Chambrun both answered, setting up facts, in substance, the same as in the Chester suit. The trustee having realized the sum of $336,226 from the sale of the property in his hands, judgment was entered in the Tauziede Case, on the 4th of October, 1888, providing for a...
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