Huber v. Johnson

• Decision Date: 26 April 1897
• Parties: HUBER v JOHNSON.
• Court: Minnesota Supreme Court

68 Minn. 74

70 N.W. 806

HUBERvJOHNSON.

Supreme Court of Minnesota.

April 26, 1897.

(Syllabus by the Court.)

The defendant having a claim for unliquidated damages against a railway company, he and plaintiff entered into a contract by which the plaintiff, who was a stranger to both the defendant and the claim, was to employ an attorney, and institute a suit in the name of the defendant for the collection of the claim, but wholly at his own cost. As compensation for his services, plaintiff was to have an amount equal to one-half of what was collected; but, if nothing was collected, he was not to charge anything for his services. Plaintiff might cancel and annul the contract whenever he became satisfied that the claim was not valid for a sufficient sum to warrant his proceeding further. The contract further provides that the defendant should not settle the claim without plaintiff's written consent, and, if he did, he was to pay the plaintiff $75. Defendant did settle the claim without plaintiff's consent. Held, in an action to recover the $75 stipulated for, that the contract was against public policy, and void.

Appeal from district court, Grant county; C. L. Brown, Judge.

Action by A. F. Huber against Gustaf Johnson. Judgment for defendant. From an order refusing a new trial, plaintiff appeals. Affirmed.

L. W. Gammons, for appellant.

W. R. Begg, for respondent.

MITCHELL, J.

This appeal is from an order sustaining a demurrer to the complaint. Briefly stated, the allegations of the complaint were that defendant, having a claim against a railway company for damages for its failure to fence its road where it ran through his farm, he and plaintiff entered into an agreement by the terms of which the former employed the latter to adjust, compromise, settle, and collect this claim, and authorized plaintiff to employ an attorney to assist him in the matter, and to prosecute the claim by suit or otherwise in the name of the defendant, but at his (plaintiff's) own cost; that plaintiff should have for his services “an amount equal to one-half of whatever sum might be collected upon said claim,” but that plaintiff should not charge defendant anything for his services unless he succeeded in collecting the claim; that defendant should not settle the claim without plantiff's consent in writing; that, if he did settle it without plaintiff's consent, he should pay the latter $75 within 10 days after making the settlement, “which sum is hereby agreed upon as full compensation in such case for any services performed by the second party [plaintiff] hereunder.” The contract further provided that whenever the plaintiff became satisfied that the claim was not good and valid for a sufficient sum to warrant his proceeding further, he might cancel and annul the agreement and all obligations thereunder. It also contained a general power of attorney from the defendant to the plaintiff to do and perform all and every act requisite or necessary in the premises as fully as defendant could do if personally present. The complaint alleged that the plaintiff entered upon the performance of the contract, employed an attorney, and brought an action to collect the claim, which was at issue and ready for trial when defendant, without the knowledge or consent of the plaintiff, settled the claim with the railway company “for a large sum of money”; that more than 10 days elapsed since the defendant so settled the claim; that plaintiff demanded of him the payment of the $75,-the sum agreed in the contract to be paid in such event,-but that defendant refused, and still refuses, to pay the same; that said sum of $75 is the reasonable value for the services rendered by plaintiff for defendant in the matter. The case has been argued and submitted on the assumption or concession by the respective counsel that plaintiff was a layman, and not an attorney; that he had no interest in the claim except what he acquired under this contract; and that he was in no way connected with the defendant by the ties of consanguinity, affinity, or otherwise. Neither have the counsel discussed the questions whether, if the contract was void, the plaintiff could recover the reasonable value of the services actually rendered, and, if so, whether the complaint is sufficient to entitle him to recover on that ground. On the contrary, both sides have treated the action as one on the express contract, and defendant's counsel himself says that the only question is as to the validity of that contract. Therefore that is the only question which we shall consider, and we shall do so upon the same basis of facts which counsel have assumed in their argument.

The contention of the defendant is that the contract is void, as champertous, and as being against public policy. It is unnecessary to consider any disagreement among the common-law authorities as to the exact definition of champerty, for under any of them this agreement was clearly champertous at common law....