Danielson v. Stokes

• Decision Date: 20 March 1963
• Citation: 29 Cal.Rptr. 489,214 Cal.App.2d 234
• Parties: George E. DANIELSON, Walter M. Campbell and Thomas T. Johnson, Cross-Complainants and Cross-Defendants in Certain Pleadings and Appellants, v. Shirley L. STOKES et al., Cross-Complainants and Cross-Defendants in Certain Pleadings and Respondents. Civ. 26485.
• Court: California Court of Appeals Court of Appeals

Page 489

29 Cal.Rptr. 489

214 Cal.App.2d 234

George E. DANIELSON, Walter M. Campbell and Thomas T. Johnson, Cross-Complainants and Cross-Defendants in Certain Pleadings and Appellants, v. Shirley L. STOKES et al., Cross-Complainants and Cross-Defendants in Certain Pleadings and Respondents.

Civ. 26485.

District Court of Appeal, Second District, Division 4, California.

March 20, 1963.

George E. Danielson, Walter M. Campbell and Thomas T. Johnson, Los Angeles, in pro. per. for appellants.

Anderson, McPharlin & Conners, Los Angeles, for respondents.

KINGSLEY, Justice.

George E. Danielson, Walter M. Campbell and Thomas T. Johnson (appellants) were awarded a summary judgment on their claim for attorneys' fees arising out of their representation of Jack G. Fisher. Appellants object on appeal to the decision made by the trial court as to the source of payment of their claim. Respondents are various other claimants of proceeds of the policy of life insurance which is the subject of the main action.

In October 1958 Jack G. Fisher contracted to sell his interest in a construction business to Houston Fred Stokes. Stokes agreed to pay $100,000 for the business and to assume all liability and obligations under contracts then existing and to perform such contracts and to hold Fisher harmless from any liabilities then existing or thereafter incurred by Stokes in relation to the contracts. A supplemental agreement was executed by Fisher and Stokes in September 1959 for the purchase and sale of the business and in settlement of a civil action whereby Stokes agreed to pay $120,000 instead of the original $100,000.

Appellants participated in the negotiations for the settlement of Fisher's claim against Stokes. Originally, appellants contracted with Fisher for a contemplated fee of 20 per cent of the recovery on the claim against Stokes. Upon settlement of the claim, Stokes gave Fisher a promissory note for $115,700, secured by an insurance policy on Stokes' life, having a $100,000 face value, payable to Fisher to the extent of the balance of the purchase price which remained unpaid at the time and in the event of Stokes' death. Pursuant to the settlement agreement the policy which was obtained provided for double indemnity in the event death resulted from accidental means and the beneficiaries were named and provided for as 'Jack G. Fisher, creditor, as his interest may appear; balance, if any, to Shirley Lee Stokes, wife of the insured if living.'

At time the note was executed appellants and Fisher mutually agreed to reduce the fee to $17,000 plus interest at 6 per cent, payable out of monies paid by Stokes on the note (our italics). It was further agreed that appellants would receive 20 per cent of the note proceeds until the $17,000 plus interest was paid. Fisher assigned 20 per cent interest in the note to appellants to secure this agreement.

Stokes died on January 11, 1960, in an aircraft accident, making $200,000 payable under the insurance policy. Many claims were made to the policy proceeds by Stokes' widow and by creditors of Fisher. The insurance carrier interpleaded the several claimants and deposited the insurance proceeds plus interest in court.

Ellis R. Jackson, Globe Indemnity Company, American Casualty Company of Reading, Pennsylvania, and Continental Casualty Company, all creditors of Jack Fisher and of the business sold to Stokes, sought to levy execution on the proceeds of the policy of insurance on the life of Stokes. These actions were finally disposed of by the decision of the California Supreme Court in Jackson v. Fisher, 56 Cal.2d 196, 14 Cal.Rptr. 439, 363 P.2d 479. The Supreme Court granted to Fisher an exemption from execution or attachment pursuant to the provisions of sections 690 and 690.19, Code of Civil Procedure, amounting to $67,473.84. This exempt amount represented the proportion allowable by statute (§ 690.19, Code Civ.Proc.) of Fisher's interest in the policy proceeds at the time of Stokes' death.

Following the Supreme Court's decision in Jackson v. Fisher, supra, 56 Cal.2d 196, 14 Cal.Rptr. 439, 363 P.2d 479, Fisher in the instant action moved for summary judgment for the exempt insurance proceeds. The motion was granted and the clerk of the court was ordered to pay Fisher $67,473.84 plus interest. The record on appeal in this proceeding does not expressly show that the monies so ordered paid have been turned over by the clerk. It may be inferred from the phrasing of the order and judgment appealed from (C.T. 158, lines 22-27) that such payment has been made and counsel so stated, without contradiction, at the argument before us.

Subsequently the trial court granted appellants motion for summary judgment for fees of $17,000 plus interest, but ordered it to be paid as follows: $13,779.39 out of the amount set aside to Fisher (representing 20 per cent of that amount), and the remaining $3,579.17 to be paid out of the insurance proceeds remaining on deposit in court.

Appellants' claim their retainer agreement with Fisher, by its terms relating to lien and assignment, clearly and unequivocally conveyed to them rights to payment out of the fund on deposit in the trial court superior to those of any other party in the interpleader action; that the fund available for said payment is the sum of $117,729.50 ¹...