Laybourn v. Bray & Shifflet

• Decision Date: 23 April 1919
• Docket Number: (No. 1437.)
• Citation: 214 S.W. 630
• Parties: LAYBOURN v. BRAY & SHIFFLET.
• Court: Texas Court of Appeals

214 S.W. 630

LAYBOURN v. BRAY & SHIFFLET.

(No. 1437.)

Court of Civil Appeals of Texas. Amarillo.

April 23, 1919.

On Motion for Rehearing by Appellant, May 21, 1919.

Appeal from District Court, Wheeler County; W. R. Ewing, Judge.

Suit by Bray & Shifflet against W. A. Laybourn. Judgment for plaintiffs, and defendant appeals. Affirmed.

Crudgington & Works, of Amarillo, for appellant.

Kimbrough, Underwood & Jackson, of Amarillo, for appellees.

HUFF, C. J.

This is the second appeal to this court. The former appeal will be found in 190 S. W. 1159. The appellees, Bray & Shifflet, sued appellant, Laybourn, upon a contract of employment as attorneys to represent and prosecute certain litigation between appellant and the Spaulding Manufacturing Company in the state of Iowa, which contract is in writing and dated September 30, 1912, executed and signed after the case had been tried in the lower court, but afterwards appealed, reversed, and sent back for new trial. The contract stipulated, among other things, that appellees had charged appellant $1,000 for their services, $500 thereof paid by note, the remaining $500 to be paid on the expiration of the statutory period for appeal of the case, and, if appealed, $100 additional for services to be rendered in the Supreme Court and $200 additional in the event of reversal of the judgment, and retrial in the lower court. Recovery was sought on the $500 note and the other $500 stipulated for after the time for appeal and the $100 for services rendered in the Supreme Court. It is alleged that the appellees were employed to establish appellant's claim against the Spaulding Manufacturing Company for the sum of $4,124.13, upon which suit was filed in Poweshiki, Iowa; that about the same time the Spaulding Manufacturing Company entered suit against appellant to recover about the same sum and in the same court; that thereupon appellant dismissed his suit against the company, and by proper pleadings denied that he owed the company the amount sued for or any part thereof, setting up his claim of the amount due him and the further sum of $295.87 for caring for certain property. The amount sued for by the company was claimed to be due it by appellant for moneys received by him belonging to the company while acting as agent for the company in Texas, appellant claiming the amount so retained by him as due him for commission on sales, and which sum he had retained and applied on the amount due him. Upon reversal of the case by the Supreme Court of Iowa and upon its return to the district court, where the suit originated, the Spaulding Company dismissed its suit against appellant, and it is alleged under the law of that state the dismissal carried with it a determination of appellant's claim against the company. There are two other counts in the petitions, Nos. 6 and 7, by which appellees pleaded in the alternative to recover on the original contract, and by the seventh count, if for any reason they should not be able to recover on either contract, that they recover the value of their services, which they allege to have been of the reasonable value of $1,500.

The answer of appellant, as well as the petition of appellees, is quite voluminous, but we think it may be stated that the first ground for defeating the contract of employment alleged by appellant is that appellant was desirous of securing attorneys not connected with the Spaulding Company at that time, and would not be during the course of the litigation then in hand, and that the appellees represented that they were not then so employed by Spaulding Company, and agreed that they would not accept employment as such during the pending litigation; that appellees breached their agreement and thereafter accepted employment from the company. It is also alleged that appellant was induced to enter into the contract sued upon dated September 30, 1912, by "misleading, false, and fraudulent representations, statements, and conduct" of appellees and to employ the appellees as attorneys and to execute the contract and note upon which this suit is based. One of the grounds of fraud was, as alleged, that Spaulding, some time in September, 1912, retained appellees as the company's attorneys, which was concealed from appellant; that one of the attorneys offered to confess judgment for Spaulding, but afterwards the case was tried in which appellant obtained judgment; that the contract was executed a day or two after appellant obtained judgment, was secured from appellant upon the definite and positive assurance that the record was in such condition as to assure affirmance and would be affirmed by the Supreme Court, and appellant fully protected thereby; that appellees intended thereby to secure an unjust advantage of appellant. There is a long recital of acts on the part of appellees in order to show acts and conduct in connection with the Spaulding Company to prevent a recovery on the part of appellant and to interfere with other employment secured by appellant with another company. It is also alleged that in obtaining the contract the appellees took advantage of their relation to him and superior knowledge as lawyers to obtain the contract without making that full and complete statement of facts that is required of an attorney dealing with a client, and it is again alleged that the contract was obtained "by the fraud and deception of plaintiffs." It is alleged substantially by both parties that the original contract of employment was made March 13, 1909, and reduced to writing; that thereby appellees were to receive one-third of whatever sum they might recover in the suit above the sum of $2,000. Appellant alleged during the progress of the suit and after certain demurrers were sustained appellees became dissatisfied with their contingent compensation, and also, taking advantage of a favorable verdict, induced appellant to make the contract of September 30, 1912; that under their original contract appellees would have been entitled to only $850. We believe this will be a sufficient statement of the pleadings to understand the issues submitted by the trial court. As there appears to be no complaint that the answer of the jury to the issues submitted or the judgment of the court are without sufficient evidence to support them, and as we conceive it, under the assignments, it will only be necessary to set out the charge and issues together with the jurors' answers, which are as follows:

"(1) An attorney must act toward his client with the utmost good faith and fidelity, and must make known to him the exact status, so far as he is able, of all matters concerning which he is employed.

"(2) Fraud is never presumed, and must be established by preponderance of the evidence by the party alleging same as grounds for avoidance of a contract.

"(3) Expressions of opinion as to what could or would be done in the future are not such false representations as to entitle one to avoid a contract on the ground of fraud.

"(4) The burden of proof is upon the plaintiff to prove the material allegations in their petition by a preponderance of the evidence, by which is meant the greater weight or degree of credible testimony.

"(5) This case is submitted to you upon special issues and you will answer the following questions:

"Question 1. Did plaintiff Bray promise Laybourn in discussing with him the execution of the contract of March 13, 1909, that he, the said Bray, would not accept employment from or be under the influence of the Spaulding Manufacturing Company during the progress of any litigation that might grow out of the differences of Laybourn with the Spaulding Manufacturing Company? A. No.

"Question No. 2. If you have answered the foregoing in the affirmative, then did said Bray breach his promise to the defendant Laybourn? A._____.

"Question No. 3. Was the contract of March 13, 1909, at any time mutually abandoned by the parties? A. Yes.

"Question No. 4. Did Bray make misleading, false, and fraudulent representations and statements to Laybourn to induce Laybourn to employ him as his attorney and to enter into the contract of September 30, 1912? A. No.

"Question No. 5. Was the contract of September 30, 1912, reasonable, fairly made, and entered into between the parties after an honest, full, and fair understanding of all material matters relating thereto? A. Yes.

"Question No. 6. Did Laybourn, after he had full knowledge of all the material facts and circumstances concerning the manner in which plaintiffs had conducted his litigation with the Spaulding Manufacturing Company, agree to pay plaintiffs according to the contract of March 30, 1909? A. Yes."

On these findings the court rendered judgment for appellees for the sum of $1,356.19, which is the amount called for in the contract of September 30, 1912, together with interest thereon up to the date of the judgment.

Appellant presents assignments to issues Nos. 1 and 2, which assignments assail the issues because it is asserted the court placed the burden on appellant to show fraud on the part of appellees in securing the first contract. In other assignments it appears to be the contention of appellant that it rested with appellees to show the utmost good faith in accepting the employment as an attorney and in entering into a contract for compensation. This rule does not apply until after the relation of attorney and client exists. It would be a harsh rule if an attorney could not recover a fee contracted to be paid under employment until he shows he acted in good faith and disclosed fully to his proposed client all of the conditions before he knew them or could positively know them. The rule does not apply to a mere contract whereby the attorney's compensation is fixed upon employment. Rabb v. Goodrich, 46 Tex. Civ. App. 541, 102 S. W. 910; Stanton v. Embry, 93 U. S. 548, 23 L. Ed. 983; Cooley v. Miller, 156 Cal. 510, 105 Pac. at page 986; Elmore v. Johnson, 143 Ill. 513, 32 N. E. 413, ...