Lee Line Steamers v. Robinson

• Decision Date: 06 April 1916
• Docket Number: 2825.
• Citation: 232 F. 417
• Parties: LEE LINE STEAMERS v. ROBINSON.
• Court: U.S. Court of Appeals — Sixth Circuit

232 F. 417

LEE LINE STEAMERS v. ROBINSON.

No. 2825.

United States Court of Appeals, Sixth Circuit.

April 6, 1916

Stephens Lincoln & Stephens, of Cincinnati, Ohio (C. H. Stephens, Sr. of Cincinnati, Ohio, of counsel), for appellant.

W. D Gilbert, of Memphis, Tenn., for appellee.

Before WARRINGTON and KNAPPEN, Circuit Judges, and SANFORD, District judge.

WARRINGTON Circuit Judge.

This was a suit to set aside two written instruments purporting to transfer to S. R. Lee all right and interest of Robinson plaintiff below, in a judgment previously recovered by him against the Lee Line Steamers, defendant below. The bill alleges diversity of citizenship, that plaintiff had not signed either of the instruments or received any money or other consideration for either, and that defendant had procured the instruments through fraudulent acts and practices of some of its agents, including the transferee. The answer specifically denies such acts and practices, and in great detail of alleged facts and circumstances states defendant's version of the negotiations leading up to and including the execution of the instruments. Decree was entered for plaintiff, adjudging in substance as follows: Plaintiff had signed the instruments; they had been received by S. R. Lee as agent for defendant; they had been fraudulently obtained and were null and void; and, the amount of the judgment having been paid to the clerk, it was ordered that, after deducting the sums, with interest, which appear in the instruments, respectively, to have been received by plaintiff, the clerk pay the money remaining in his hands to the plaintiff.

The answer also alleges that the bill does not show upon its face that the court has jurisdiction. True, the sum or value of the matter in dispute is not formally alleged; but it was not absolutely necessary that it should be. The amount could be otherwise shown. United States v. Freight Association, 166 U.S. 290, 310, 17 Sup.Ct. 540, 41 L.Ed. 1007; Robinson v. Suburban Brick Co., 127 F. 804, 806, 62 C.C.A. 484, and citations (C.C.A. 4th Cir.).

The bill states the amount of the judgment to be $5,000. The object of the suit is to have conflicting claims and interests determined in respect of the judgment recovered in the action at law, and so is ancillary in character. Lumley v. Wabash R. Co., 76 F. 66, 69, 22 C.C.A. 60 (C.C.A. 6th Cir.). The answer alleges, in the first place, that the instruments in issue purport to transfer to Lee only the interest of plaintiff in the judgment, and that this interest is less than $3,000, and, in the next place, that the instruments were received by defendant with knowledge that plaintiff's attorney would in the event of recovery be entitled to a claim and lien thereon for 50 per cent. of the amount as fees, and thus that the matter in controversy is, exclusive of interest and costs, less than the sum of $3,000. So far as the defense of jurisdiction is concerned, the burden of proving these allegations touching the value of plaintiff's interest in the judgment was on the defendant, and it failed to discharge the burden; on the contrary, the balance of the judgment, which in distinct terms was ordered to be paid to the plaintiff, as before pointed out, is largely in excess of $3,000. Independently of this, the compensation of counsel is neither interest nor costs, and for jurisdictional purposes is to be treated as part of the matter in controversy. Springstead v. Crawfordsville State Bank, 231 U.S. 541, 542, 34 Sup.Ct. 195, 58 L.Ed. 354.

Upon the merits of the controversy, it is insisted that this court shall reverse the conclusions of the District Judge which resulted in the decree. The general rule undoubtedly is, as counsel strenuously urge, that a court of equity cannot set aside a written instrument for fraud, upon a bare preponderance of testimony which leaves the issue in doubt, but that this must be done, if at all, upon evidence that is clear, unequivocal, and convincing. As the contention of counsel appears to us, however, they rely on decisions announcing the rule rather than upon the particular facts to which the rule was applied. Upon their facts we regard those cases as distinguishable from the present case. The question of ultimate control here is whether, in view of all the facts and circumstances of the instant case, it can be said that the rule mentioned was not in effect observed and followed by the learned trial judge.

We have seen that the judgment is for $5,000. The recovery was for serious personal injuries suffered by plaintiff while a passenger on one of the defendant's steamboats. Lee Line Steamers v. Robinson, 218 F. 559, 134 C.C.A. 287. According to the first of the two...