In re Dodge

• Decision Date: 05 August 1904
• Parties: In re DODGE et al.
• Court: Minnesota Supreme Court

93 Minn. 160

100 N.W. 684

In re DODGE et al.

Supreme Court of Minnesota.

Aug. 5, 1904.

Proceedings against Vernon W. Dodge and Willis E. Dodge to secure disbarment. Rule to show cause discharged.

Douglas, J., dissenting.

Eli Southworth, for petitioner.

D. F. Reese, H. C. Belden, W. E. Hale, and M. H. Boutelle, for respondents.

PER CURIAM.

This proceeding was commenced against respondents, upon petition of the secretary of the State Board of Law Examiners, to secure their disbarment for willful misconduct as counselors at law. The petition alleges that September 13, 1903, Mrs. Fitzgerald and Hugh Rankin were injured in a Great Northern Railroad wreck at Dassel, Minn., and that respondents were engaged as attorneys to prosecute their claims for damages for injuries received; that, owing to her physical condition and business inexperience, Mrs. Fitzgerald placed the entire control and management of her case in the hands of her brother, Thomas O'Brien, who resided in Minneapolis, and who, it is alleged, in consideration of obtaining the business for respondents, was promised by them 25 per cent. of whatever fee might be received; that an action was commenced in the district court of Hennepin county to recover the sum of $20,000 damages, and thereupon negotiations were conducted between respondents and the railroad company, which on November 3, 1903, resulted in a settlement of the claim for $5,000; that thereafter, November 4, 1903, respondents informed Mrs. Fitzgerald and her brother Thomas O'Brien by letter that the company had offered $3,500 in settlement of the claim, which was the greatest amount it would pay, that limit having been fixed by the executive board; that the offer would be withdrawn unless accepted before 4 o'clock on that day; and that respondents preferred to take a $500 fee, and give Thomas O'Brien 25 per cent. thereof, rather than take chances on the result of litigation. The petition alleges that, deceived by such representations, Mrs. Fitzgerald accepted the supposed offer by the railroad company of $3,500, and executed a power of attorney to respondent W. E. Dodge, authorizing him to make settlement of her claim; that the following day, November 5th, respondents made a settlement with the company pursuant to the agreement of November 3d, and received the sum of $5,000 in discharge of the claim, executed the acquittance papers, and dismissed the action; that respondents paid Mrs. Fitzgerald $3,000, representing to her that settlement had been made for $3,500, out of which they would retain $500 for their services, less $125 paid to Thomas O'Brien. The petition then alleges that in fact respondents received and retained $2,000, $1,500 of which they fraudulently appropriated to their own use. In the Rankin case it is alleged that respondents made an agreement for settlement with the company on November 3, 1903, for $1,000, and the next day represented to Rankin they had settled for $500-their fees to be $100, 25 per cent. of which was to go to Thomas O'Brien; that they received $1,000, and paid Rankin $400, retaining $600, of which amount they fraudulently appropriated to their own use $500. Respondents answered orally, denying the accusations. The evidence was taken before a referee, and it has become the duty of this court to determine from the evidence thus returned whether the charges are sustained.

The defense is that October 17, 1903, Thomas O'Brien, Representing Mrs. Fitzgerald, inquired of respondents what would be their fee in her case; that he was told the usual fee was 40 to 50 per cent. of the amount recovered, and that a 40 per cent. basis was agreed upon; that suit was commenced and negotiations conducted with that understanding; that the two cases now under consideration, and two others growing out of the same accident, also in the hands of respondents, were considered together, and the company refused to settle any one of them unless all were compromised; that respondents, on behalf of their cilents, offered to accept $10,000 in settlement of the four claims, which was rejected by the company; that on November 3d, at respondents' office, in Minneapolis, John R. Howard, the company's claim agent, made an offer of $6,000 in settlement of the four claims, which was refused; that November 3d O'Brien expressed dissatisfaction with the amount likely to be received by his sister on the percentage basis, and proposed that a definite net amount be fixed upon, which he desired should be $5,000; that, upon being informed of the offer of $6,000, and that the Fitzgerald claim would be entitled to only $3,500 of that amount, he agreed to accept $3,000 net for his sister, and the letter, Exhibit 3, was written November 4th, at O'Brien's suggestion, to set forth the facts to Mrs. Fitzgerald and her family, to show good faith on his part in making the settlement. Respondents further claim that it was understood by both O'Brien and Mrs. Fitzgerald that they were to retain all they could secure over $3,000 for their fees and expenses, and that, after this agreement was entered into, Mr. Howard offered to raise the amount from $6,000 to $8,000 in settlement of the four cases, and that they finally compromised for the sum of $8,750. As to the Rankin claim the defense is similar. Mr. Rankin was told that the usual fees were 40 to 50 per cent. of the amount received, but in his case no definite agreement was made. November 4th Rankin stated that if he could get $400 he would be satisfied, as he wanted to get away, and it was agreed that he should receive that amount; it being understood that respondents were entitled to whatever they might obtain in excess thereof.

The evidence is voluminous and conflicting, but centers around two principal points contended for by the prosecution, and two which are relied upon by the defense, viz.: Upon the part of the state, that Howard had offered $8,000 in settlement of the four cases prior to the writing of the letter, Exhibit 3, and that it was written by respondents to Thomas O'Brien and Mrs. Fitzgerald for the purpose of inducing them to enter into a settlement for the sum of $3,500, respondents having already made an agreement with the company upon the basis of $5,000. Upon the part of the respondents, that October 17th they agreed with O'Brien to take the Fitzgerald case upon the basis of 40 per cent. of the amount received, and that this contract was afterwards changed, whereby she was to receive $3,000 net, and respondents to retain whatever could be secured over that sum.

According to the testimony of Thomas O'Brien, respondents solicited the business, and, for his trouble in the matter, agreed to pay him 25 per cent. of such fees as they might receive. In this connection, it should be noted that another brother, William O'Brien, was injured in the same wreck, and respondents were desirous of also securing control of his claim for damages. Thomas O'Brien stated that, in the course of several conversations prior to October 17th, he asked respondents the amount of their fees, and that W. E. Dodge replied that in Mrs. Fitzgerald's case it would not be a great deal-a few hundred dollars for their fees and expenses of running around-and that no positive agreement as to the amount was ever made. Mr. O'Brien admits that he visited respondents' office, in Minneapolis, on October 17th, for the purpose of consultation with reference to his sister's case, but states that he arrived there in the early afternoon, and found no one in but Miss Le Beau, the stenographer, and that he had no interview with respondents. On the contrary, respondents, Miss Le Beau, and two other witnesses (A. A. Andrews and John R. Heino) testified they were in respondents' office on that day between 12 and 1 o'clock, and heard a conversation between respondents and O'Brien regarding compensation, and that it was agreed respondents should receive 40 per cent. O'Brien is corroborated as to time by the timekeeper of the American Bridge Company, where he worked, and the records kept, which show he was at work on that day until 12:30 o'clock. If he had gone directly from his work to respondents' office. he could have arrived there within the time fixed by respondents' witnesses; but O'Brien states that he walked 12 blocks to his home, washed up, and had his dinner before going to respondents' office. Respondents and their witnesses testify that they left the office about one o'clock, had their lunch, and then went to the football game. Whether this contract was entered into upon the basis of 40 per cent. is an important feature in this case, and has direct bearing upon the subsequent conduct of the parties. We get little assistance in determining this point from other sources than the testimony of the persons already mentioned. Upon the one hand, there was some reason for leaving the amount of their fees undetermined, if their object was to secure control of the William O'Brien claim, which was the most serious of all, and was afterwards settled for $7,500. On the other hand, it seems perfectly reasonable that Thomas O'Brien, on behalf of his sister, would desire to know what portion of the amount recovered would be retained for fees and expenses, and how much his sister might expect to recover. The amount stated by the attorneys as the usual fee is certainly high, but we are not prepared to say that it was excessive or unusual, under such circumstances. It is an easy matter to be mistaken as to the exact time or date, especially as to matters occurring several months prior to the time of testifying. It was possible for Mr. O'Brien to have reached the office after leaving his work, and he may have been mistaken in stating that he first went to his home; and, after carefully reading the testimony of all of these witnesses, we are unable to say that the interview did not take place as claimed by respondents, and that it was understood the fee would be 40 per cent. of the...