McIntosh v. Zaring

• Citation: 150 Ind. 301,49 N.E. 164
• Parties: McINTOSH et al. v. ZARING et al.
• Decision Date: 27 January 1898
• Court: Supreme Court of Indiana

150 Ind. 301

49 N.E. 164

McINTOSH et al.

v.ZARING et al.

Supreme Court of Indiana.

Jan. 27, 1898.

Appeal from circuit court, Jackson county; Newton Crook, Special Judge.

On rehearing. Former opinion (38 N. E. 321) withdrawn. Reversed.

Alspaugh & Lawler, Applewhite & Applewhite, Wm. K. Marshall, and Ferdinand Winter, for appellants. Mitchell & Mitchell and Burrell & Branaman, for appellees.

McCABE, J.

The appellees sued the appellants in the Washington circuit court to recover attorney's fees upon a written contract. There was an answer filed, leading to issues of law and fact. The venue was changed to the Jackson circuit court. A trial of the issues of fact in that court resulted in a verdict and judgment in favor of the plaintiffs in the sum of $7,500, over appellants' motion for a new trial. Among the numerous errors assigned are that the trial court erred in overruling a demurrer to the amended complaint for want of sufficient facts; that said complaint does not state facts sufficient to constitute a cause of action; and that the court erred in overruling the defendants' motion for a new trial. The contract sued on is as follows: “Ellen McIntosh and Andrew J. McIntosh, her husband, have this day employed as counsel to contest the will of W. C. De Pauw, deceased, and to conduct all legal proceedings for that purpose, Friedly & Giles, of Bedford, Indiana, Zaring & Hottel, of Salem, Indiana, and C. L. & H. E. Jewett, of New Albany, Indiana. Suit to contest said will is to be immediately filed and prosecuted with all reasonable dispatch; and for all their services, of every kind, performed in relation to said suit, said attorneys are to receive the following compensation, and no other, viz.: For their services in the event that the will of W. C. De Pauw is set aside and Ellen McIntosh declared entitled to share in his estate, a fee equal to twenty-five and a half (25 1/2 per cent.) per cent. of the value of the estate which she shall thus be entitled to, and does, receive; and in the event of a compromise or adjustment before a trial is begun, whereby said will is allowed to stand, a sum equal to twelve and a half per cent. (12 1/2) of the amount so received or stipulated to be received by her. They agree to pay said fee as follows: One-third to Friedly & Giles, one-third to Zaring & Hottel, and one-third to C. L. & H. E. Jewett. Ellen McIntosh. A. J. McIntosh. Friedly & Giles. C. L. & H. E. Jewett. Zaring & Hottel.” The complaint alleged the performance of the contract on the appellees' part, and that the suit was compromised before trial, by which appellant Sarah E. McIntosh received from the estate of said W. C. De Pauw $250,000, and that she fraudulently concealed the knowledge of the amount so received, and falsely represented to them that she had only received $50,000 from said estate by said compromise; that, relying on such representations, the appellees had settled with and accepted from her 12 1/2 per cent. of $50,000; that 12 1/2 per cent. on the excess received by her was still due them, and remained unpaid,-demanding judgment for $30,000 and other proper relief. It is also alleged that Charles L. and Henry E. Jewett refused to join as plaintiffs, and for that reason they were made defendants. They filed an answer disclaiming all interest in the suit. It is also alleged in the complaint that the appellees John A. Zaring and Milton B. Hottel were attorneys at law, engaged in the practice of their profession, under the firm name of Zaring & Hottel, at the town of Salem, Washington county, Ind., and that appellee Joseph Giles and the said George W. Friedly were at said date engaged in the practice of law in the city of Bedford, Lawrence county, Ind.; that, after the performance of said services under said contract, said George W. Friedly had died, and the plaintiff Edith M. Friedly had been appointed administratrix de bonis non of the estate of said deceased.

We hold that the contract sued on did not create a joint right of action in all the plaintiffs, and hence the legal effect of the written contract was the same as if there had been three several and separate written contracts in favor of each of the three several firms or groups of attorneys; and hence we hold that the contract itself did not create a joint right of action in said attorneys, and cite the following cases supporting that conclusion: Goodnight v. Goar, 30 Ind. 418;Tate v. Railroad Co., 10 Ind. 174;Lippard v. Edwards, 39 Ind. 165;Martin v. Davis, 82 Ind. 41;Harris v. Harris, 61 Ind. 117;Elliott v. Pontius, 136 Ind. 641, 35 N. E. 562, and 36 N. E. 421.

But there is an element in the complaint beyond the scope of the mere written contract that exerts an influence upon the right of the several obligees or payees therein to maintain a joint action thereon. That element is the allegations of fraud and misrepresentations of the defendants as to the amount Mrs. McIntosh had received from the estate of her father on the compromise, thereby inducing the said attorneys to accept a much smaller sum in full satisfaction of the contract than they were entitled to under its terms, according to the facts as they really existed. These allegations were material in order to enable the plaintiffs to avoid the settlement, because without avoiding that settlement none of them could recover on the contract. While neither one of the firms of attorneys in the contract mentioned was interested in either of the other firms recovering thereon, so as to enable them to join in a suit thereon, yet they were all interested in the other element which was essential to be established, without which neither of them could recover, namely, the fraud by which they had been induced to accept a smaller sum in full settlement and discharge of the contract than was really due them. In other words, they were all alike interested in avoiding the settlement. Our Code provides: “All persons having an interest in the subject of the action, and in obtaining the relief demanded, shall be joined as plaintiffs, except as otherwise provided in this act.” Rev. St. 1894, § 263; Rev. St. 1881, § 262. Another section of the Code provides that, “when the action arises out of contract, the plaintiff may join such other matters in his complaint as may be necessary for a complete remedy and a speedy satisfaction of his judgment, although such other matters fall within some other one or more of the foregoing classes.” Rev. St. 1894, § 281; Rev. St. 1881, § 280. These sections of the Code have the effect even to broaden the rule in equity in such cases. That rule was that several separate creditors might unite in an action where a part of the relief prayed was common to all. But the rule required them to first reduce their respective claims to judgments at law. However, there were some exceptions to that rule. Where the debtor was dead or had absconded from the state, they could join in such action without obtaining judgments at law. Kipper v. Glancey, 2 Blackf. 356;Ruffing v. Tilton, 12 Ind. 259. The sections quoted have been construed as authorizing such creditors to join as plaintiffs, though their claims be separate and distinct, and even though the debtor is alive, and has not absconded, if the plaintiffs have a common interest in any of the relief sought, whether their claims have been reduced to judgments or not; and, if they have not, they may recover separate judgments on such claims in connection with the relief sought common to all, such as suit by creditors to set aside fraudulent conveyances, and subject their debtor's property to the payment of their debts and the like. And, accordingly, persons who have any interest in the relief demanded are properly joined as plaintiffs. Durham v. Hall, 67 Ind. 123;Strong v. Taylor, 79 Ind. 208;Field v. Holzman, 93 Ind. 205;Elliott v. Pontius, 136 Ind. 641, 35 N. E. 562, and 36 N. E. 421;Armstrong v. Dunn, 143 Ind. 433, 41 N. E. 540;Carmien v. Cornell, 147 Ind. ---, 47 N. E. 216; Pom. Rem. §§ 266-268; 1 Daniell, Ch. Prac. 235. We therefore hold that the relief sought against the alleged fraud was such as was common to all the plaintiffs, and was essential to the right of any of them to recover on the contract; and hence such allegations gave them a right to join as plaintiffs, and in that respect the complaint was not bad for want of sufficient facts. It is true, there was no specific prayer asking that the settlement be set aside on account of the alleged fraud; but the facts were stated entitling plaintiffs to such relief, and there was a general prayer for judgment and other proper relief, and that is sufficient, under the Code, to entitle the plaintiffs to all relief that the facts stated will warrant.

We find that the complaint does not allege that Friedly and Giles were partners at the time, but it does allege that Zaring and Hottel were partners, engaged in the practice of law. It is contended, however, that enough appears in the complaint and the written contract sued on to disclose that Friedly and Giles executed the contract as partners. And, in support of this contention, we are cited to Cook v. Frederick, 77 Ind. 406;Henshaw v. Root, 60 Ind. 220;Telegraph Co. v. Huff, 102 Ind. 535, 26 N. E. 85;Crowell v. Bank, 3 Ohio St. 406, and other authorities. We have examined them, and find they do not sustain the appellants' contention as to the point in question. The manner in which the contract was signed by Friedly and Giles would be competent evidence as tending to prove the existence of a partnership between them, and that is as far as the authorities cited by appellants go. Competent evidence tending to prove a material fact is not the fact or the equivalent thereof. The fact must be alleged affirmatively before the demurrer admits it to be true. A demurrer admits as true only such allegations as are properly and sufficiently pleaded. Peyton v. Kruger, 77 Ind. 486;Johnston v. Griest, 85 Ind. 503;Platter v. City...