Gannon v. American Airlines, 5452

• Decision Date: 02 January 1958
• Docket Number: 5479,5480,No. 5452,5481.,5452
• Citation: 251 F.2d 476
• Parties: Mark GANNON, Appellant, v. AMERICAN AIRLINES, Inc., a Delaware corporation; Associated Aviation Underwriters; W. R. Britton, Carroll Britton; McBride Bone & Joint Clinic and Dowell, Inc., Appellees. Carroll BRITTON, Appellant, v. AMERICAN AIRLINES, Inc., a Delaware corporation, Associated Aviation Underwriters, W. R. Britton, McBride Bone & Joint Clinic, Mark Gannon and Dowell, Inc., Appellees. McBRIDE BONE & JOINT CLINIC, a partnership, and Bone & Joint Hospital, a corporation, Appellants, v. AMERICAN AIRLINES, Inc., a Delaware corporation, Associated Aviation Underwriters, W. R. Britton, Carroll Britton, Mark Gannon and Dowell, Inc., Appellees. DOWELL, Inc., Appellant, v. AMERICAN AIRLINES, Inc., a Delaware corporation, Associated Aviation Underwriters, W. R. Britton, McBride Bone & Joint Clinic, Carroll Britton, and Mark Gannon, Appellees.
• Court: U.S. Court of Appeals — Tenth Circuit

251 F.2d 476 (1958)

Mark GANNON, Appellant, v. AMERICAN AIRLINES, Inc., a Delaware corporation; Associated Aviation Underwriters; W. R. Britton, Carroll Britton; McBride Bone & Joint Clinic and Dowell, Inc., Appellees.

Carroll BRITTON, Appellant, v. AMERICAN AIRLINES, Inc., a Delaware corporation, Associated Aviation Underwriters, W. R. Britton, McBride Bone & Joint Clinic, Mark Gannon and Dowell, Inc., Appellees.

McBRIDE BONE & JOINT CLINIC, a partnership, and Bone & Joint Hospital, a corporation, Appellants, v. AMERICAN AIRLINES, Inc., a Delaware corporation, Associated Aviation Underwriters, W. R. Britton, Carroll Britton, Mark Gannon and Dowell, Inc., Appellees.

DOWELL, Inc., Appellant, v. AMERICAN AIRLINES, Inc., a Delaware corporation, Associated Aviation Underwriters, W. R. Britton, McBride Bone & Joint Clinic, Carroll Britton, and Mark Gannon, Appellees.

Nos. 5452, 5479, 5480, 5481.

United States Court of Appeals Tenth Circuit.

July 3, 1957.

Judgment January 2, 1958.

COPYRIGHT MATERIAL OMITTED

Rex H. Holden, Oklahoma City, Okl. (C. L. McArthur and Hobert G. Orton, Ada, Okl., and Stewart & Lytton, East Moline, Ill., on the brief), for appellant Gannon.

Austin R. Deaton, Jr., Ada, Okl. (Busby, Stanfield, Deaton & West, Ada, Okl., on the brief), for appellants Carroll Britton, McBride Bone & Joint Clinic, and Bone & Joint Hospital.

Solon W. Smith, Oklahoma City, Okl. (W. D. Hart, Pauls Valley, Okl., William J. Crowe, and Hal D. Leaming, Oklahoma City, Okl., on the brief), for appellant Dowell, Inc.

Luther Bohanon, Oklahoma City, Okl. (Bohanon & Barefoot, Oklahoma City, Okl., on the brief), for appellee W. R. Britton.

Fred M. Mock, Oklahoma City, Okl. (Pierce, Mock & Duncan, Oklahoma City, Okl., on the brief), for appellees American Airlines, Inc., Fidelity & Casualty Co. of New York, and Associated Aviation Underwriters.

Before BRATTON, Chief Judge, and PICKETT and LEWIS, Circuit Judges.

BRATTON, Chief Judge.

These several appeals were perfected from a judgment entered in an interpleader action. American Airlines, Inc., hereinafter referred to as American, instituted the action against W. R. Britton, hereinafter referred to as Britton, Carroll Britton, wife of W. R. Britton, Mark Gannon, hereinafter referred to as Gannon, and McBride Bone & Joint Clinic, hereinafter referred to as Clinic, to determine conflicting claims to a fund deposited in the registry of the court contemporaneously with the institution of the action. Fidelity and Casualty Company, hereinafter referred to as Fidelity, and Associated Aviation Underwriters, hereinafter referred to as Underwriters, were subsequently made parties; though not made a party, Bone & Joint Hospital, hereinafter referred to as Hospital, joined Clinic in interposing a joint answer; and Dowell, Inc., hereinafter referred to as Dowell, intervened.

The conflicting claims to the fund in the registry of the court arose out of these facts. Britton was injured while a passenger on an airplane owned and operated by American. Fidelity was the insurance carrier for American. Acting for Fidelity, Underwriters issued the policy which provided among other things that the insurer should defend in the name and on behalf of the insured any claims or suits against the insured; that the insurer should have the right to settle any claim or suit at its own cost; and that the insurer should pay, within certain limits, losses imposed upon or assumed by the insured as the result of specified accidents. Britton brought a suit against American in the United States Court for Western Oklahoma to recover damages for his personal injuries. Acting in the name and on behalf of American, Underwriters took charge of the defense of the action. An agreement was reached to settle the case upon the basis of payment to Britton in the sum of $91,000. Underwriters issued its check for $91,000. The check was dated January 25, 1956, was drawn on the National City Bank of New York, and was payable to Britton, Carroll Britton, Orel Busby, and Truman B. Rucker. Busby and Rucker were attorneys for Britton in the case being settled. Under date of January 25, Britton and Carroll Britton executed a full and final release covering all claims or rights of action of every description for the injuries, losses, or damages resulting from Britton's injuries. Busby and Rucker signed the release as witnesses. The release recited payment of $91,000 by American, receipt of which was acknowledged. On January 25, a stipulation was filed in the case. It was signed by Britton, Carroll Britton, Busby, Rucker, and American. It was stipulated that a full, final, and complete settlement had been reached between the parties in the sum of $91,000; that the settlement included any and all claims that Carroll Britton might then or thereafter have growing out of the injuries to her husband; and that the cause should be dismissed with prejudice. And on January 25, an order of dismissal was entered in the case, based upon the stipulation. On the morning of January 26, the check was endorsed by the named payees and deposited for collection in a bank in Oklahoma City. Gannon held an unpaid judgment against Britton. The judgment was rendered by the Circuit Court of Fayette County, Illinois, on October 20, 1951, was for the sum of $18,000, and bore interest at the rate of five per cent per annum. Gannon instituted in the state court in Oklahoma an action to recover a domestic judgment upon the foreign judgment rendered in Illinois. Britton pleaded that the foreign judgment was tainted with fraud. The court in Oklahoma entered judgment for Gannon. On appeal, the judgment was reversed on account of the exclusion of certain tendered evidence. Britton v. Gannon, Okl., 285 P.2d 407, certiorari denied, 350 U.S. 886, 76 S.Ct. 140, 100 L. Ed. 781. The cause was remanded and is still pending in the district court. About two hours after the check for $91,000 had been delivered to the payees in Oklahoma City, Gannon obtained from the Superior Court of Cook County, Illinois, a citation in the nature of a garnishment against American and caused it to be served promptly upon American in Illinois. The basis of the process in the nature of a garnishment was the unsatisfied judgment which Gannon owned. The process in the nature of garnishment commanded American to appear and attend a hearing at a fixed time and place for examination concerning money or property of Britton held by American; prohibited American from making disposition of any such money or property not exempt from execution or garnishment, until the further order of the court; and provided that American was not required to withhold payment of money beyond double the amount of the judgment against Britton. American advised Underwriters of the service of the process, and Underwriters caused the check to be returned unpaid.

After the return of the check, an agreement was entered into in which it was agreed that $61,000 should be paid to Britton; that an interpleader action should be instituted; and that $30,000 should be deposited in the registry of the court in such action. Underwriters paid the $61,000 to Britton; this action was instituted in the name of American; and $30,000 furnished by Underwriters was deposited in the registry of the court. It was pleaded in the complaint that American had caused the $61,000 to be paid; that it had retained the $30,000 as stakeholder; that a controversy existed between Britton, Carroll Britton, Gannon, and Hospital concerning their respective rights in the fund being retained; and that American could not determine without danger to whom various payments should be made out of such fund. Upon the institution of the action and the making of the deposit in the registry of the court, an order was entered in the action restraining Gannon from proceeding further with the garnishment proceeding pending in the court in Illinois; restraining Gannon from commencing or instituting any other action designed to recover or in any manner affect the fund in the registry of the court; and restraining Britton, Carroll Britton, and Clinic from commencing or instituting any action designed to recover all or any part of the fund in the registry of the court.

Gannon pleaded rights in the fund under his unpaid judgment and the citation in the nature of garnishment served upon American. Britton and Carroll Britton pleaded that they entered into an agreement to divide equally the proceeds of the settlement. Clinic and Hospital asserted rights under an alleged verbal agreement with Britton in which he assigned to them such portion of any money which became due him from American necessary to cover medical and hospital services rendered to Britton. And Dowell asserted rights in the fund under an unpaid judgment against Britton upon which garnishment was issued and served. The judgment upon which Dowell relied was rendered by the United States Court for Eastern Oklahoma, was for $18,662.10, together with attorneys' fees in the sum of $1,981.29, and bore interest at the rate of six per cent per annum. After its intervention in this cause, Dowell instituted in the court for Eastern Oklahoma, garnishment proceedings against American and Fidelity for the enforcement of its unpaid judgment against Britton. On appeal, the judgment against Britton was vacated and the cause was remanded for a single specified purpose. Britton v. Dowell, Inc., 10 Cir., 237 F.2d 630. On remand, the court again entered judgment against Britton; and on appeal, the judgment was affirmed. Britton v. Dowell, 10 Cir., 243 F.2d 434. Britton and Carroll Britton employed the law firm of Bohanon and Barefoot to represent them as counsel in this case on a contingent basis of fifty per cent; and there was appended to the answer on behalf of Britton and Carroll Britton a footnote signed by the attorneys stating that an attorneys' lien was claimed.

In its judgment, the court awarded to Bohanon and...