Dunlap & Dunlap v. Zimmerman
| Decision Date | 26 October 1938 |
| Docket Number | 14755. |
| Citation | 199 S.E. 296,188 S.C. 322 |
| Parties | DUNLAP & DUNLAP v. ZIMMERMAN et al. ZIMMERMAN v. CENTRAL UNION BANK OF SOUTH CAROLINA et al. |
| Court | South Carolina Supreme Court |
Appeal from Common Pleas Circuit Court of Richland County; Wm. H Grimball, Judge.
Action in the nature of a general creditor's bill by Simpson J Zimmerman, as Conservator of the Central Union Bank of South Carolina, against the Central Union Bank of South Carolina and others, wherein Dunlap & Dunlap, a copartnership heretofore composed of Walter M. Dunlap and Herbert M Dunlap, with all rights now vested in Walter M. Dunlap, as surviving partner, filed petition for fees for legal services rendered the conservator. From the judgment, Simpson J Zimmerman and others appeal.
Modified and, as modified, affirmed.
Melton & Belser and J. Edwin Belser, all of Columbia, for appellants.
Thomas, Lumpkin & Cain, of Columbia, for respondent.
The Central Union Bank of South Carolina, a South Carolina Banking Corporation, did not reopen for general business after the banking holiday which commenced on March 4, 1933, and was thereafter declared insolvent and ordered into liquidation by the Governor of South Carolina, acting with the advice of the State Board of Bank Control pursuant to the Emergency Banking Laws of this state. Act No. 622, p. 1174, approved March 9, 1933, Act No. 235, p. 296, approved April 14, 1933, and Act No. 350, p. 489, approved May 16, 1933. By these laws the office of State Bank Examiner was abolished, and the Governor of the State, acting with the advice of the State Board of Bank Control, was given plenary control and supervision of the banks of the State, and vested with power to order insolvent banks into liquidation under conservators. (By later Acts of the Board alone was given this power.) Pursuant to these enactments, S. J. Zimmerman was, on March 20, 1933, appointed as conservator of the bank, and took over the control of its affairs. J. Edwin Belser was appointed general counsel for the Conservator, and on May 25, 1933, the law firm composed of Herbert M. Dunlap and Walter M. Dunlap, was named as associate counsel. The employment of this latter firm continued until the death of Mr. Herbert M. Dunlap on January 15, 1934.
On October 3, 1933, Mr. J. Roy Barron was appointed as co-conservator by the Governor, acting with the advice of the State Board of Bank Control. Prior to the appointment of Mr. Barron, and on or about June 26, 1933, S. J. Zimmerman, as sole conservator, instituted an action, as permitted by the Emergency Banking Laws, in the Court of Common Pleas for Richland County, against The Central Union Bank of South Carolina and others, to obtain the instructions of the Court on certain matters. This action was in the nature of a general creditor's bill, and responsive to its allegations the court issued its decree directing that all persons holding claims of any nature against the bank be called in and required to establish their demands, or else be barred; and restricting all creditors and claimants from bringing any separate action or actions or proceeding against the bank or affecting its assets, save by proceeding in the pending action, which was left open.
The petitioner, Walter M. Dunlap, in his own right, and as surviving partner of the firm of Dunlap & Dunlap, filed his verified petition in this proceeding in which he prayed that the fees earned by his firm for services rendered the conservator be determined by the court pursuant to the terms of Section 7855 of the Code of Laws of South Carolina 1932, or under the general powers of the court sitting in equity; and alleged that the sum of $2,500 was a reasonable fee for general consultative legal work, and that a further fee of not less than $4,500 be allowed for legal services in preparing numerous abstracts of title to real estate and making reports thereon, an itemized list of the abstracts being attached to the petition. Prior to the filing of this petition, Mr. Dunlap had filed with the conservators a bill for the services rendered by his firm. This bill was submitted by the conservators to the State Board of Bank Control, which Board refused payment, but offered to pay in full settlement the sum of $1,750.
Upon respondent's verified petition, his Honor Judge Ramage issued a rule requiring the appellants to give published notice, as required by Section 7855, to creditors and depositors of the bank of a hearing to determine and fix the fees of the respondent at the term of the Court of Common Pleas for Richland County commencing November 16, 1936. This notice was duly published by the conservators. Thereafter the conservators, appellants here, filed their return and answer, alleging, on information and belief, that the amounts claimed by the respondent for services rendered are excessive and unreasonable; and further alleged that under the law of South Carolina the State Board of Bank Control was vested with quasi judicial powers to determine and limit the amount to be paid as attorney's fees for services rendered, and that this Board had theretofore fixed the fees in question in the sum of $1,750; and further pointed out that no abuse of discretion by the Board was alleged in the petition. The appellants prayed that the petition be dismissed, or in the alternative, that the executrix of the estate of Herbert M. Dunlap, deceased, be made a party by amendment.
The cause came on to be heard on November 17, 1936, before Judge Ramage, upon the petition and return, and he passed an order, after a full hearing, requiring the amendment of the petition by making parties, not only the executrix of the estate of Herbert M. Dunlap, but also the members of the State Board of Bank Control, and referred the cause to the Master of Richland County to take the testimony upon all issues arising under the proceedings filed or to be filed. From this order no appeal was taken. The executrix defaulted. The State Board of Bank Control answered, alleging that under a misapprehension of the law as to the authority of the Board in the premises, it had theretofore fixed what it deemed a reasonable fee for the services of the respondent, but that it had since been advised by the attorney general that it is without authority to fix fees of attorneys employed, after the liquidation of a bank under receivership shall have been ordered.
It was further alleged by the Board that it had no duties in the matter of fixing what fees are proper in this case, and should not be put to the expense and inconvenience of defending this suit.
The Master took voluminous testimony, and the cause was thereafter heard by his Honor Judge Grimball on the merits, on December 3, 1937, and resulted in a decree directing the conservators to pay to the respondent the sum of $2,000 for general services rendered, and the further sum of $2,750 for services rendered in the abstracting of titles, the court holding that such amounts were reasonable and proper. However, shortly prior to the call of the case, the appellants, on November 13, 1937-nearly one year after the proceeding was begun-served a notice that they would move the court to dismiss the action, or in the alternative, to grant judgment in their favor, on the ground that the court was without jurisdiction to pass upon the issues, because under the Act approved March 9, 1933, and subsequent laws, the governor of the state, or the State Board of Bank Control, is vested with exclusive power to fix or limit the liquidating expenses of banks becoming insolvent subsequent to said date. This motion was overruled by Judge Grimball by an order in which he held that the order of Judge Ramage dated November 17, 1936, from which no appeal was taken, was res adjudicata of the jurisdictional issue.
The primary question presented for this court's determination in this appeal is whether, in view of the Emergency Banking Laws and the employment of respondent thereunder, the court below had jurisdiction to hear and determine the respondent's claim for legal services rendered in the liquidation of the bank; and, if so, the amount payable therefor.
The appellants contend that it was the legislative purpose and intent to vest the State Board of Bank Control alone with jurisdiction over the banks of the state and their liquidation, including the determination of liquidating expenses, to the exclusion of the court.
We are met at the threshold with the jurisdictional question. The appellants challenge the holding of Judge Grimball wherein he held that the Court's jurisdiction of the subject matter of the action was passed upon adversely to the appellants by Judge Ramage in his order of November 17, 1936, to which reference has been made.
We turn to the pleadings which were before Judge Ramage to determine what issues were presented to him. By Paragraph 2 of the Return filed by the appellants it is alleged: "That under the law of the state of South Carolina the State Board of Bank Control was vested with quasi judicial powers to determine and limit the amount to be paid as attorneys' fees for services, and your respondents respectfully show unto the Court that the said Walter M. Dunlap heretofore...
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