McCarty v. Goodsman

• Decision Date: 17 January 1918
• Citation: 167 N.W. 503,39 N.D. 389
• Court: North Dakota Supreme Court

167 N.W. 503

39 N.D. 389

JOHN MCCARTY, and Finch, Van Slyck, & McConville, Plaintiffs, v. CHARLES GOODSMAN, also Known as Charles W. Goodsman, Asa J. Styles, and Paul Campbell, Defendants, ASA J. STYLES, Appellant. and JOHN MCCARTY and Finch, Van Slyck, & McConville, Plaintiffs, v. CHARLIE GOODSMAN, also Known as Charles W. Goodsman, Asa J. Styles, and Paul Campbell, Defendants and Respondents, and JOHN MCCARTY, Appellant

Supreme Court of North Dakota

January 17, 1918

Rehearing denied April 12, 1918.

Appeal from District Court, Pierce County, A. G. Burr, J.

Affirmed.

Judgment of the trial court affirmed, without costs.

Harold B. Nelson and Albert E. Coger, for John McCarty, appellant and respondent.

An attorney's lien is strictly dependent upon continuity of possession. Where promissory notes are introduced and received in evidence upon a trial proceeding in district court, they become court files and are in the possession of the court, and thereafter if one of the attorneys obtains the consent of the court for their removal from the files of the cause in which they were used, to his own office and into his own hands, his possession of them is the possession of the court still, and he can claim no lien on them, as papers belonging to his client, in his possession. Heard v Cherry, 145 Ky. 80; Pollock v. Aitkens, 4 S.D 374; Wisconsin R. Co. v. Given, 69 Iowa 581; Howe v. Mutual Reserve, 115 Iowa 285.

An attorney's lien cannot be transferred to another, and such attempted transfer destroys it. 2 Mechem, Agency, 2d ed § 2272; 6 C. J. 777.

The delivery for collection or other special purpose, bye the pledgee to the pledgeor, does not extinguish the lien. 31 Cyc. 818, 819.

"A client's knowledge of facts affecting litigation is equivalent to the knowledge of his attorney." 6 C. J. 641, § 145; McNemar v. McNemar, 143 Ill. 184.

"The relation of attorney and client is created by contract, and litigants who have not thus assumed liability for attorney's fees cannot be held liable therefor, although they may have been benefited directly or indirectly by the attorney's services." Riees v. Patty, 60 Am. St. Rep. 510; Roselius v. Delachaise, 5 La.Ann. 481, 52 Am. Dec. 597; Chicago v. Larmed, 26 Ill. 218; Turner v. Meyers, 23 Iowa 391; Atty. Gen. v. North American L. Ins. Co., 91 N.Y. 57, 43 Am. Rep. 648; Hand v. Savanah, 21 S.C. 162; Westmoreland v. Martin, 24 S.C. 238.

Asa J. Styles, Attorney pro se, and Paul Campbell, Attorney pro se and for Asa J. Styles, appellant and respondent.

"A lien is to be deemed accessory to the act for the performance of which it is a security, whether any person is bound for such performance or not, and is extinguished in like manner with any other accessory obligation." Comp. Laws 1913, § 6720.

Where the contract of pledge is merely collateral to the principal obligation it is given to secure, it is discharged by the payment of the principal obligation. So, too, the discharge of the principal obligation of the debtor in any other way will operate to discharge the contract of pledge. 31 Cyc. 851.

It is then fraud from any right of the pledgee to hold it for any other debt than that for which it was pledged." Comp. Laws 1913, § 6724; 31 Cyc. 817, 818, 853.

"The lien of a pledge is dependent upon possession, and no pledge is valid until the property pledged is delivered to the pledgee, or to a pledge holder as hereinafter prescribed." Comp. Laws 1913, § 6772.

"A mere agreement by the debtor that the creditor shall take and hold certain property as security for the debt is insufficient. Delivery is necessary." George v. Butler, 26 Wash. 456, 57 L.R.A. 396, 67 P. 263; Presidio County v. Bond Co., 212 U.S. 75.

"Where a debt is payable in instalments the general rule is that the statute begins to run as to each instalment, from the time when it falls due, and that the creditor can recover only on those instalments falling due within the period before the beginning of the action." 25 Cyc. 1106; Davis v. Harrington, 53 Ark. 5, 13 S.W. 215; DeUprey v. DeUprey, 23 Cal. 352; Washington L. & T. Co. v. Darling, 21 App. D. C. 132; Burnham v. Brown, 23 Me. 400; Baltimore Co. v. Barnes, 6 Harr. & J. 57; Wood v. Cullen, 13 Minn. 394 (365); Berry v. Doremus, 30 N.J.L. 399; Mason v. New York, 28 Hun, 115; Pelton v. Bemis, 44 Ohio St. 51, 4 N.E. 714; Adelbert v. Toledo, 5 Ohio S. & C. P. Dec. 14, 3 Ohio N. P. 15; Bush v. Stowell, 71 Pa. 208, 10 Am. Rep. 694; Overton v. Tracey, 14 Serg. & R. 311; Miles v. Kelly (Civ. App. 1894) 25 S.W. 724; Morrill v. Smith County (Civ. App. 1895) 33 S.W. 899; 33 Century Dig. Limit. of Actions, §§ 280, 281 et seq.; 25 Cyc. 1089, note 51.

Promissory notes payable in instalments are within the rule of the text. 25 Cyc. 1107; Burnham v. Brown, 23 Me. 400; Bush v. Stowell, 71 Pa. 208, 10 Am. Rep. 694.

Interest coupons outlaw independent of the principal debt. Clark v. Iowa City, 20 Wall. 583, 22 L.Ed. 427; Amy v. Dubuque, 98 U.S. 470, 25 L.Ed. 228; Griffin v. Macon County, 2 L.R.A. 353, 36 F. 885; Cases cited in 33 Century Dig. col. 496; 18 Am. Dig. Annual ed. Limit. of Actions, § 51 (Key Number).

Our Statute of Limitations begins to run not from the "maturity of the debt" nor from the time the debt "becomes due," but from the time "the cause of action has accrued." A cause of action may have accrued on a note, authorizing commencement of foreclosure of a mortgage securing it, long before the debt represented thereby has by the terms of the note matured or become due, if the mortgage is so worded as to allow it.

Accelerating words in a mortgage and the fact that the holder forecloses for the full amount of the secured debt are sufficient to show that the holder has elected to declare the entire amount due, on account of default in the payment of the first instalment. Doolittle v. Nurnberg, 27 N.D. 521; Westcott v. Whiteside, 63 Kan. 49, 64 P. 1032; 25 Cyc. 1104; 7 Cyc. 858-861; 33 Century Dig. Limit. of Actions, § 281; Belloc v. Davis, 38 Cal. 242; Whitcher v. Webb, 44 Cal. 127.

These acceleration provisions in a mortgage are solely for the benefit of the mortgagee, so that the mortgagor cannot take advantage of it in computing limitations. Richardson v. Warner, 28 F. 343; Batey v. Walter (Tenn.) 46 S.W. 1024; Wall v. Marsh, supra; Doran v. O'Neal, 37 S.W. 563; Boyd v. Buchanan (Mo.) 162 S.W. 1075; Trust Co. v. Light Co. (Miss. ) 63 So. 575; Hemp v. Garland, 4 Q. B. 519; Reeves v. Butcher, [1891] 2 Q. B. 509; Bank v. Peck, 8 Kan. 660; Ryan v. Caldwell, 106 Ky. 543, 50 S.W. 966; Wheeler v. Howard, 28 F. 741; Harrison v. Reigor, 64 Tex. 89; Dodge v. Signor, 18 Tex. Civ. App. 45, 44 S.W. 926; Singleton v. Heriott, 37 S. C. L. (3 Rich.) 321; Snyder v. Miller, 71 Kan. 410, 69 L.R.A. 250, 114 Am. St. Rep. 489, 80 P. 970; Pierce v. Shaw, 51 Wis. 316, 8 N.W. 207; San Antonio v. Stewart, 94 Tex. 441, 61 S.W. 386; Manitoba Mortg. Co. v. Daly, 10 Man. 425; Westcott v. Whiteside, 63 Kan. 49, 64 P. 1032; Lycoming Co. v. Batcheller, 62 Vt. 148, 19 A. 982; Hunt v. Roberts, 45 N.Y. 691; Park v. Cooke 3 Bush, 168; Noell v. Gaines, 68 Mo. 649; Salmon v. Claggett, 3 Bland, Ch. 179; Green v. Frick, 25 S.D. 342, 126 N.W. 579; Moore v. Sargent, 112 Ind. 484, 14 N.E. 466; McFadden v. Brandon, 8 Ont. L. Rep. 610; Germond v. Hermosa Ice Co., 9 S.D. 387, 69 N.W. 578; Trust Co. v. Light Co., 64 So. 216, 63 So. 575; Spesard v. Spesard, 75 Kan. 87, 88 P. 576; Buchanan v. Berkshire Co., 96 Ind. 510; White v. Miller, 52 Minn. 367, 19 L.R.A. 673, 54 N.W. 736; Rasmussen v. Levin, 28 Colo. 449; Banzer v. Richter, 123 N.Y.S. 678; Malcolm v. Allen, 49 N.Y. 448; Brownlee v. Arnold, 60 Mo. 79; Kelley v. Kershaw, 5 Utah 804, 14 P. 804.

"Where by the terms of the contract the failure to pay an instalment of a debt matures the whole debt, by the terms of the contract the Statute of Limitations runs from the first default." Ganser v. Ganser, 83 Minn. 199, 86 N.W. 18; 25 Cyc. 1107, and cases cited; Bank v. Peck, 8 Kan. 660; Ryan v. Caldwell (Ky.) 50 S.W. 966; Wheeler v. Howard, 28 F. 741; Boyd v. Buchanan, 162 S.W. 1075.

The statute runs from date of default, and not from date of election. Goss v. Lovell, 101 P. 72-75; San Antonio v. Stewart, 94 Tex. 441, 61 S.W. 386; Green v. Frick, 25 S.D. 342; Buchanan v. Berkshire Co., 96 Ind. 510; Doolittle v. Nurnberg, 27 N.D. 521.

"An attorney has a lien for a general balance of compensation in and for each case, upon any papers belonging to his client which have come into his hands in the course of his professional employment in the case for which the lien is claimed." Comp. Laws 1913, § 6875, subd. 1.

An attorney's lien may be foreclosed by advertisement, and the foreclosure here of the Campbell lien transferred to Styles the title to the notes and mortgage on which the lien foreclosed was claimed. Comp. Laws 1913, § 6878; Black v. Elev. Co., 7 N.D. 129; Mitchell v. Elev. Co., 15 N.D. 495; Schlosser v. Moores, 16 N.D. 185; Wonser v. Elev. Co., 31 N.D. 382; Garr-Scott v. Clements, 4 N.D. 559; Grove v. Loan Co., 17 N.D. 352.

Plaintiff failed to show any interest in the property or existing indebtedness in their favor. Bank v. Bank, 8 N.D. 50.

"The assignee of a right of property or chose in action is concluded by a judgment for or against his assignor, in a suit begun before the assignment, but not where his rights vested prior to the commencement of the action." 23 Cyc. 1260, and cases cited.

"The rule with regard to privies is that its operation must be mutual upon both parties; both litigants must be concluded or the proceedings cannot be set up as conclusive for either." Hunt v. Haven, 52 N.H. 169 citing Bouv. Inst. 374; Sobey v. Beiler, 28 Iowa 323; Coles v. Allen, 64 Ala. 105; Reynolds v. AEtna Co., 55 N.E. 310 and cases cited; Ward v Boyce, 36...