Gill v. Richmond Co-Op. Ass'n, Inc.

• Decision Date: 26 May 1941
• Citation: 309 Mass. 73,34 N.E.2d 509
• Parties: GILL et al. v. RICHMOND CO-OP. ASS'N, Inc.
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court

309 Mass. 73

34 N.E.2d 509

GILL et al.

v.RICHMOND CO-OP. ASS'N, Inc.

Supreme Judicial Court of Massachusetts, Norfolk.

May 26, 1941.

Action of contract by William Gill and others against the Richmond Co-operative Association, Incorporated, wherein defendant filed a set-off, and wherein plaintiffs and another filed a bill to restrain the enforcement of a judgment obtained by defendant against plaintiffs which was basis of defendant's set-off. Findings for defendant in the principal action and decree for defendant in the bill for injunction, and plaintiffs and William A. Graustein, as assignee of plaintiffs' cause of action, bring exceptions and appeal, and defendant brings exceptions.

Order in accordance with opinion.Exceptions from and Appeal from Superior Court, Norfolk County; Hanify, Judge.

Argued before FIELD, C. J., and DONAHUE, LUMMUS, QUA, and DOLAN, JJ.

R. Hall, and F. T. Iddings, both of Boston, for defendant.

W. A. Graustein, pro se.

LUMMUS, Justice.

On September 9, 1929, the four plaintiffs, brothers named Gill, brought this action of contract to recover for the breach of oral agreements by which the defendant agreed to sell to the plaintiffs whatever milk they might order for their business. On January 6, 1937, the case was heard by a judge, sitting without jury, upon successive reports of an auditor whose findings were not to be final, and other evidence that, as the judge said, did not affect the findings of the auditor. On January 3, 1938, the judge found for the defendant on the plaintiffs' declaration and also on the defendant's declaration in set-off. The case comes here primarily upon exceptions filed by William A. Graustein acting pro se and claiming to be the assignee of the cause of action of the plaintiffs.

On February 15, 1939, a bill was brought by the plaintiffs and Graustein to restrain the enforcement of the judgment obtained on February 19, 1934, by the defendant against the plaintiffs in the case of Richmond Co-operative Association, Inc., v. Gill, 285 Mass. 50, 188 N.E. 495, upon which execution issued for $3,080.86 damages and $97.40 costs, which judgment was the basis of the defendant's declaration in set-off. This bill was filed in the action, and not entered as a separate suit, as it should have been. From a final decree entered on July 17, 1939, permitting the defendant to use the judgment in set-off, but not to collect any balance from the plaintiffs personally, the plaintiffs and William A. Graustein as assignee claimed an appeal. Moreover, the same parties claimed an appeal in the action of contract from the denial of their motion to dismiss the declaration in set-off, but this appeal must be dismissed because not authorized by G.L. (Ter.Ed.) c. 231, § 96. The plaintiffs' exception to the denial on February 8, 1938, of their motion to amend the writ and declaration is obviously worthless, for the denial involved no ruling of law. Like some other exceptions taken by them it needs no discussion.

At the threshold of the case in this court lie the exception of the defendant to the allowance of exceptions filed by William A. Graustein pro se as assignee of the cause of action, and the motion filed by the defendant in this court on February 11, 1940, to dismiss the exceptions and appeals filed by William A. Graustein pro se as such assignee, on the grounds (1) that he was practicing law without having been admitted to the bar, in violation of G.L. (Ter.Ed.) c. 221, § 46A, inserted by St.1935, c. 346, § 2, and (2) that he was acting under a champertous contract.

There is ground for a contention, the soundness of which we need not decide in this case, that a pleading, an appeal, or any other step taken in a lawsuit on behalf of a party, by one having no right to act as an attorney at law, is a nullity where the want of authority of the purported attorney is seasonably raised or at least where it has already been raised; and the case will stand as though that step had not been taken. Henry L. Sawyer Co. v. Boyajian, 296 Mass. 215, 218, 5 N.E.2d 348.

For a number of years we have observed that William A. Graustein, who, as the auditor found, apart from any question of judicial notice, is not an attorney at law, has conducted numerous lawsuits for other persons as ‘attorney in fact’ when ‘specially authorized’ in writing by the client under the supposed authority of G.L. (Ter.Ed.) c. 221, § 49, now repealed by St.1935, c. 346, § 3.^* Doubtless the same observation has been made by the Superior Court. But after the Opinion of the Justices, 279 Mass. 607, 180 N.E. 725, 81 A.L.R. 1059, was rendered on April 20, 1932, it became apparent that the statute cited afforded him no justification for practicing law without admission to the bar. Opinion of the Justices, 289 Mass. 607, 612, 616, 194 N.E. 313;Matter of Lyon, 301 Mass. 30, 16 N.E.2d 74. In more recent cases he has prosecuted lawsuits pro se as assignee of the cause of action. Graustein v. H. P. Hood & Son, Inc., 293 Mass. 207, 200 N.E. 14;Graustein v. Boston & Maine Railroad, 304 Mass. 23, 22 N.E.2d 594;Petition of Graustein, 305 Mass. 568, 26 N.E.2d 535;Petition of Graustein, 305 Mass. 571, 26 N.E.2d 536.

It is not unlawful to engage in the business of buying choses in action and enforcing them by suit if necessary. See G.L. (Ter.Ed.) c. 231, § 5; c. 221, § 48. The long established business of buying commercial paper at a discount is of that nature. But obviously the formal assignment of a claim may be used to conceal the actual relationship of attorney and client. Where this appears, the court will tear away the pretence, and strike down any illegal attempt to practice law. Moreover, an assignment to one who furnishes no consideration except his undertaking to prosecute the claim at his own expense and risk, and is to be rewarded only by a share of the proceeds, is champertous, whether he is an attorney at law or not. Belding v. Smythe, 138 Mass. 530;Gargano v. Pope, 184 Mass. 571, 69 N.E. 343,100 Am.St.Rep. 575;Smith v. Weeks, 252 Mass. 244, 147 N.E. 676;Sherwin-Williams Co. v. J. Mannos & Sons, Inc., 287 Mass. 304, 191 N.E. 438;Baskin v. Pass, 302 Mass. 338, 19 N.E.2d 30;Graustein v. Boston & Maine Railroad, 304 Mass. 23, 22 N.E.2d 594;Brown v. Ginn, 66 Ohio St. 316, 64 N.E. 123;Dahms v. Sears, 13 Or. 47, 11 P. 891;Ames v. Hillside Coal & Iron Co., 314 Pa. 267, 171 A. 610;Sampliner v. Motion Picture Patents Co., 2 Cir., 255 F. 242; Williston, Contracts (Rev. ed. 1938) § 1715.

The present action of contract was begun in 1929 by William A. Graustein as ‘attorney in fact’ for the plaintiffs, under a written power of attorney. On February 1, 1933, the plaintiffs assigned their claim to their mother Ellen Gill. The plaintiffs owed Graustein $1,200 for legal services in other matters and for money expended. It is not argued that this sum was not owed to Graustein. If he could not recover for legal services, there is nothing to show that he could not recover for the money expended. On February 16, 1933, the plaintiffs transferred to Graustein four shares in a corporation owned by them, and, since no other shares had been issued, these four shares gave him apparent ownership of the corporation. Ellen Gill exchanged with Graustein the claim assigned to her for these four shares, and assigned the claim to Graustein on April 28, 1934. On April 30, 1934, Graustein entered his appearance pro se, and on January 20, 1936, he was permitted to intervene as assignee. Since that time he has conducted the action and has brought it to this court pro se as assignee, ostensibly for his own benefit, although he has continued at times to use the names of the original plaintiffs as well as his own name. We speak of the plaintiffs without distinguishing between the original plaintiffs and Graustein as assignee.

In fact, however, as the auditor found, Graustein held the four shares only as security, and took the assignment only as security for the same debt of $1,200, plus the legal services and expenses of the present action, and subject to the duty of returning any balance to Ellen Gill. There was no agreement that Graustein should look exclusively to the proceeds of the assigned claim for payment. The mere fact that Graustein took an assignment as security did not make the arrangement champertous. Tapley v. Coffin, 12 Gray, 420;Blaisdell v. Ahern, 144 Mass. 393, 395, 11 N.E. 681,59 Am.Rep. 99;Smith v. Weeks, 252 Mass. 244, 251, 252, 147 N.E. 676. Graustein had a security interest of his own of long standing in the shares, and this was transferred to the claim assigned to him. His enforcement of his own claim could not be ruled as matter of law the practicing of law without authority. The judge allowed his bill of exceptions, and thus determined in his favor any question of fact involved. We must, therefore, entertain Graustein's exceptions and appeal, and proceed to consider their merits.

The following findings appear in the reports of the auditor or in the findings of the judge made by inference from the findings of the auditor. The plaintiffs were partners in the business of distributing milk at retail in the neighborhood of Holbrook. The defendant was a corporation engaged in Vermont in shipping milk to local distributors in Massachusetts like the plaintiffs. From April 2, 1924, the plaintiffs, under an arrangement with an authorized agent of the defendant in Massachusetts named Edwards, received milk from the defendant at the Forest Hills railroad station at a price fixed by the can. On August 31, 1925, the plaintiffs told Edwards that they could buy milk cheaper elsewhere.

On the same day Edwards orally proposed on behalf of the defendant that it supply the plaintiffs for one year beginning September 1, 1925, and ending August 31, 1926, with all the milk they might order, at a price based on the average monthly price by the pound for butter as compiled by the New England Milk Producers Association, plus two cents a pound,...