Keenan v. Scott et al.
| Decision Date | 24 March 1908 |
| Citation | 64 W.Va. 137 |
| Court | West Virginia Supreme Court |
| Parties | Keenan v. Scott et al. |
1. Attorney and Client When Relationship Exists.
As soon as a client has expressed a desire to employ an attorney and there has been a corresponding consent on the part of the attorney to act for him in a professional capacity, the relation of attorney and client has been established: and all dealings thereafter between them relating to the subject of the employment will be governed by the rules applicable to such relation. (p. 143.)
2. Same Continuance.
After such relationship has begun, any subsequent change in their agreement as to compensation, or as to the property out of which such compensation of the attorney is to come, will not affect such existing relationship. (p. 143.)
3. Same Conveyance to Attorney Bight to Rescind.
Where, after such relationship has been established, the attorney procures from the client a conveyance to himself of part of the property involved in litigation, as compensation for his legal services therein, such conveyance will be deemed presumptively invalid, and voidable, on principles of public policy and for prevention of wrong, at the election of the client, irrespective of the fairness or unfairness of the contract, provided such election is exercised within a reasonable time. (p. 145.)
4. Same Accounting by Attorney.
If the property so obtained by the attorney is sold by him, he will be held to account as trustee for the proceeds thereof. (p. 145.)
5. Same Trust Itelationship.
While the relationship of attorney and client exists, all purchases of outstanding interests by the attorney will be adjudged in trust for the client. (p. 145.)
(5. Same Compensation.
Section 13, chapter 119, Code, providing that "an attorney shall be entitled for his services as such to such sums as he may contract for with the party for whom the service is rendered," has no application to an agreement, made after the relation of attorney and client lias been established, for transfer to the former of part of the property in litigation as compensation for legal services. (p. 146.)
Appeal from Circuit Court, Randolph County.
Bill by L. H. Keenan against C. H. Scott and others. Decree for defendants, and plaintiff appeals.
Reversed. Remanded.
Jared L. Wamsley and Fred 0. Blue, for appellant.
W. B. Maxwell, S. T. Spears, W. Mollohan and H. G. Kump, for appellees.
From a decree dismissing his bill plaintiff has appealed. The substantial grounds of relief alleged were that, after this Court had in O'Connor v. O'Connor, 45 W. Va. 354, in effect adjudged him entitled to a decree enforcing his contract with O'Connor of 1893 for the purchase of a tract of 205 acres of land in Randolph county, and the judgment of this Court reversing the final decree in that cause had been certified to the circuit court for further proceedings, he employed the defendants Scott and Cobb, attorneys, to represent him as counsel in the further proceedings in that cause and in certain other litigation pending in said court, substantially upon the terms that if the title to said land should finally be adjudged in him they would pay off and discharge for him the vendor's lien for the purchase money in favor of O'Connor as ascertained, and, out of the proceeds of the sale of the land they were authorized to make with his approval, after first reimbursing themselves for the money so advanced, retain one fourth of the residue as compensation for their legal services and turn over the remaining three-fourths to him; that on September 14, 1899, to enable the said Scott and Cobb to carry out said contract and to secure them for their services and the advancement to discharge said lien, he conveyed said land to them, by deed absolute on its face, yet with the agreement that it was to operate in the nature of a trust for the purposes stated; that afterwards, January 10, 1900, after said cause of O' Connor v. O' Connor had been referred to a commissioner, Scott and Cobb filed his answer therein; that, by a decree of October 18, 1900, upon said answer, said 205 acres was confirmed in him, on the basis of his contract of 1893, but decreeing in favor of O'Connor the balance of purchase money, $2,188.71; that subsequently, March 9, 1901, in his absence and without notice to him, at a special term thereof, said court, on the ex parte petition of Scott and Cobb, modified said former decree by adjudging them entitled to said land by reason of said deed from the plaintiff to them, and appointing W. B. Maxwell commis- sioner to make them a deed therefor; that, on learning of this decree shortly afterwards, he saw Scott, who assured him same was not taken for the purpose of in any way changing their contract or relation, but for the sole purpose of carrying the same into effect, and of enabling them the better to further defend the title to the land if necessary; that, trusting Scott, his fears were allayed for a time, but that subsequently, without his knowledge or consent and contrary to the contract, Scott by deed of July 22, 1902, and Cobb by deed of October 17, 1902, conveyed said land to the defendant the Junior Coal Company; that, upon being called upon by the plaintiff for a statement and settlement, Scott and Cobb gave him only evasive answers as to the amount received by them for said land, and that from that day to the time of filing the bill they had in no way accounted to him for the proceeds of said sale. The prayer was for a discovery and accounting by the defendants, the enforcement of said contract, and such other general and special relief as the plaintiff might be entitled to. There was exhibited with the bill the deeds, decrees and proceedings referred to.
Besides their demurrer overruled, Scott and Cobb answered. They admit the original rights of the plaintiff to the land as alleged and decreed, but deny that their contract with him as was alleged in the bill, but, on the contrary, say it was expressly agreed between them and him that, for their services in said O'Connor cause and in other litigation pending in which Keenan was interested, they should have absolutely said 205 acres of land, subject to the lien of the purchase money, in case the title to the same should be declared to be in him; that at the time of making said contract with Keenan they "were not his attorneys in any matters of litigation as to which they were at that time retained," but under their contract agreed to act as his counsel thereafter. They allege that among the cases in which they were to represent the plaintiff was an action against the Roaring Creek Coal & Coke Company for damages for timber cut from said land, which they then regarded as of more value than the land itself subject to said lien; and that at the time of their employment, instead of agreeing to take as a contingent fee the land subject to said lien, they requested plaintiff to give them as such fee whatever he might recover in said action, which he declined to do, and subsequently on September 14, 1899, conveyed to them said tract of land, not in trust but absolutely. They admit the filing of plaintiffs answer, the procuring of the decree in his favor, and the one in their favor as alleged in the bill, but deny they assured plaintiff the decree in their favor was not taken for the purpose of in any way changing their contract and relation, as alleged; and, by way of discovery, they say that the deed from Scott to the Junior Coal Company shows the exact consideration paid him, $18,000, but that the deed from Cobb does not show the consideration, but, as they do not recognize the plaintiff's right to know the same, they decline to disclose it until required by the court. As affecting the plaintiff's title to the land and the value thereof at the time of the employment of Scott and Cobb, they further allege in their answer that the title thereto was originally in one Hilleary as part of a larger boundary; that one link in the plaintiff's chain of title was a deed from one Buckey, attorney in fact for said Hilleary, but whose power of attorney conferred in fact no authority upon him to sell or convey said land; that, some time after the deed from plaintiff to them, they ascertained said Hilleary had died testate, having devised all her estate to Margaret A. and Henry Carroll, and, in order to perfect their title, said Scott purchased the interest of said Carrolls in said land, and, in addition thereto, before the conveyance of the same to the Junior Coal Company, also obtained a tax deed for said land, which they believed vested all title thereto in Scott for himself and Cobb, and without which they could not have sold the same to the coal company at the price they did.
The Junior Coal Company also answered, defending as an innocent purchaser without notice, admitting that the price paid Scott for his interest in said land was as recited in his deed, but refusing, in deference to the wishes of Cobb, to disclose the price paid him unless required by the court.
Upon the issues made on these pleadings, the testimony of Keenan, Scott, Cobb and Maxwell, the only witnesses, is most conflicting on the question as to what was the real understanding at the time of the execution of the deed by the plaintiff to Scott and Cobb September 14, 1899. Scott and Cobb concur in their testimony that this deed was intended as an absolute conveyance; but there are documentary papers and strong cir- cumstances connected with the transaction tending to support the plaintiff in his claim. As we do not think the case turns upon this conflict of evidence, we will only refer to a few of these matters. The first and foremost perhaps is the fact that Scott and Cobb obtained from the plaintiff the principal subject of the litigation in which they had been employed. The suit upon the timber claim, covered by their employment, has never been brought to trial. After obtaining the...
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