Dwyer v. Anderson

• Decision Date: 12 May 1933
• Citation: 166 A. 293
• Parties: DWYER v. ANDERSON.
• Court: New Jersey Court of Chancery

166 A. 293

DWYER

v. ANDERSON.

Court of Chancery of New Jersey.

May 12, 1933.

Syllabus by the Court.

1. All transactions of an attorney with his client will be carefully scrutinized, to the end that the client may be protected from his own credulity, and from the influence which the relation of attorney and client generates.

2. Courts of equity intervene, upon consideration of public policy, to prevent fraud and abuse of confidence and influence, and to compel fidelity in the performance of fiduciary duty.

Suit by Nellie Dwyer against J. Glenn Anderson.

Decree for complainant.

Sara V. Dunn, of Harrison, for complainant.

J. Glenn Anderson and William M. McConnell, both of Newark, for defendant.

STEIN, Vice Chancellor.

Complainant, Nellie Dwyer, brings this bill of complaint for an accounting. The defendant, J. Glenn Anderson, is a member of the bar and a solicitor of this court.

In March, 1930, complainant was engaged in litigation with her husband over joint savings and also the custody of the children of their marriage. She engaged the services of the defendant as her solicitor. Among the sums of money in litigation and dispute between complainant and her husband was some $28,000. An order of this court was entered restraining complainant from with drawing funds on deposit in bank, but the funds had already been withdrawn according to complainant on the advice of defendant who brought her to the Newark National & Essex Banking Company and opened an account in that institution in the name of Catherine C. Minahan, a niece of complainant and a former stenographer in defendant's office. This, according to the defendant, was done because he thought that "it would be best for me to have a certain amount of surveillance of the money," and again, although he says that complainant desired to deposit the money in the name of her sister, he advised her that of the two names "Miss Minahan's would be better, because Miss Minahan was a younger woman and was available." The money on deposit in Miss Minahan's name, the defendant procured her signature to blank orders—one on December 3, 1930, for $15,000 which was indorsed "Chester Bodenhoff," and the other dated December 19, 1930, for $10,000, which was indorsed by Harry Jacobson and John H. Grossman. Bodenhoff deposited the order for $15,000 in his personal account) in the Newark National & Essex Banking Company, and drew a check to the Bodenhoff Company, Inc., for $12,000 and another to the defendant Anderson for $3,000. Bodenhoff and Anderson are officers of the Bodenhoff Company, Inc. Anderson at that time was its president. Two stock certificates, one for eighty shares of preferred and another for forty shares of common, were issued to complainant for the $12,000. Bodenhoff controlled the common stock. Complainant says she knew nothing of the stock transaction until she learned upon inquiry at the bank that all of her money had been withdrawn with the exception of a couple hundred dollars. She immediately demanded her money from Anderson, and then found that he had purchased stock in her name in the Bodenhoff Company, and, some time later, Anderson told her that she had executed a power of attorney, giving him the right to invest and reinvest her moneys and to pay the income by way of dividends to her. The power of attorney purports to have been signed and acknowledged by complainant before a Mr. Turesky, who is employed in the office of Mr. Anderson. Turesky says that Anderson dictated the document which Anderson denies, saying that Turesky drew it. The undisputed fact is that the instrument or its effect was never read of explained to her. Turesky simply took her acknowledgment. She says she did not know she had signed such a document, and I believe her.

The second order for $10,000 was drawn on December 19, 1930, and was indorsed by Harry Jacobson and John H. Grossman. This withdrawal of complainant's money is not explained by the defendant, except that he says he returned this money to the complainant by two checks, one dated January 9, 1931, signed by C. S. Park, drawn on the Fidelity Union Trust Company and payable to Colins Park for $5,000 and indorsed payable to complainant, and the other bearing the same date by the same drawer payable to the same drawee and indorsed the same way to the complainant. Finally a check was made on July 31, 1931, for $2,675.89, drawn on the National Newark & Essex Banking Company on the account of "J. Glenn Anderson, trustee." This latter check represents the balance of the $3,000 paid to Anderson by Bodenhoff after deducting a fee.

The complainant is an unintelligent person and one who lacks ordinary business experience. Her frame of mind during the happenings recited is best described in the words of the defendant, in that part of his testimony on the...