Davis v. Chase

• Decision Date: 27 May 1902
• Docket Number: 19,838
• Citation: 64 N.E. 88,159 Ind. 242
• Parties: Davis et al. v. Chase et al
• Court: Indiana Supreme Court

64 N.E. 88

159 Ind. 242

Davis et al. v. Chase et al

No. 19,838

Supreme Court of Indiana

May 27, 1902

Mandate Modified October 7, 1902.

From White Circuit Court; T. F. Palmer, Judge.

Action by George P. Chase against John D. Davis and others. From a judgment for plaintiff against John D. and Elizabeth Davis and also in favor of William and Joseph Kreider on a cross-complaint against the defendants, Davis, the latter appeal. Transferred from Appellate Court, under § 1337u Burns 1901.

Affirmed in part and reversed in part.

D. C Justice, E. B. Sellers and Edward Uhl, for appellants.

C. E. Spencer and M. A. Ryan, for appellees.

OPINION

Gillett, J.

The appellee Chase filed in the court below his complaint in three paragraphs, founded upon a written contract executed by himself and the appellant John D. Davis; and he also sought by said action to subject to the payment of his demand a tract of real estate that it was alleged that said John had fraudulently caused to be conveyed to his wife, the appellant Elizabeth Davis. Said first mentioned contract is of the following tenor: "This agreement, made and entered into the day and year last written, by and between John D. Davis, party of the first part, and George P. Chase, party of the second part, witnesseth: Whereas, John D. Davis has this day employed George P. Chase, party of the second part, to institute and prosecute a suit or cause of action for the purpose of obtaining his share of his father John Davis' estate, and the said John D. Davis hereby authorizes and empowers the said George P. Chase to recover said claim, either by suit or compromise, but that said George P. Chase shall not accept any compromise or settlement unless the same is satisfactory to the said John D. Davis: Now, therefore, in consideration of the said George P. Chase performing said services, the said John D. Davis agrees to pay to the said George P. Chase, as compensation for his services, a sum of money equal to fifty per cent. of any amount that he may recover, either by way of suit or compromise, and the said John D. Davis hereby expressly agrees not to enter into any compromise or accept any sum of money in settlement of said claim unless said George P. Chase is present and directs said settlement. Witness our hands this 23d day of February, 1898. [Signed] J. D. Davis. George P. Chase."

Mr. Greenhood, in his work on Public Policy, at page 474, says: "A contract by which the control of the party in interest over litigation carried on in his behalf is limited, is void." This view finds full support in the cases. In Lewis v. Lewis', 15 Ohio 715, the court said: "A contract with an attorney to prosecute a suit containing a stipulation that the party should not have the privilege to settle or discontinue it, without the assent of the attorney, would be so much against good policy that the court would not enforce it." In North Chicago St. R. Co. v. Ackley, 171 Ill. 100, 112, 49 N.E. 222, 44 L. R. A. 177, the supreme court of Illinois, speaking by Phillips, C. J., said: "The second proposition to be determined is, is a contract by which the person in whose name the action is brought, and to whom it belongs, restricted from compromising or settling such claim because of a contract to that effect? In other words, is such a contract valid and binding? * * * Whether a cause of action exists, and if so, its nature and amount, are facts always involved in uncertainty, and a defendant has a right to buy his peace. The plaintiff has a right to compromise, and avoid the anxiety resulting from a cause pending to which he is a party. Any contract whereby a client is prevented from settling or discontinuing his suit is void, as such an agreement would foster and encourage litigation." The supreme court of Arkansas has thus expressed itself upon the subject: "It is a wise public policy to allow the parties to a lawsuit, or to disputes that have not even progressed to the proportion and dignity of a lawsuit, to settle their differences without hindrance from disinterested parties. Parties should be permitted to beg or buy their peace at any time. It would be difficult to estimate the monstrously unjust consequences that might result to parties willing and ready to settle a demand of this kind, if it lay in the power of an attorney to impede or control such settlement." Davis v. Webber, 66 Ark. 190, 198, 49 S.W. 822, 45 L. R. A. 196, 74 Am. St. 81. "The law," said Judge Dillon, in deciding the case of Ellwood v. Wilson, 21 Iowa 523, "encourages the amicable adjustment of disputes; and a construction of a contract which would operate to prevent the client from settling will not be favored." To the same effect, see Boardman v. Thompson, 25 Iowa 487.

Counsel for appellee Chase do not attempt to dispute the correctness of the doctrine that the above authorities announce, but they seek to parry its force by contending that the agreement of the client not to compromise only required that the attorney should be present to advise the client in the effecting of a settlement. The verb "directs" ordinarily implies a pointing out with authority, or directing as a superior. If that is not the meaning of the word in the contract under consideration, and if it means only to guide or advise, we do not...