Platt v. Henderson

• Decision Date: 12 April 1961
• Parties: Robert Treat PLATT, Respondent, v. Wilber HENDERSON, Appellant.
• Court: Oregon Supreme Court

Page 73

361 P.2d 73

227 Or. 212

Robert Treat PLATT, Respondent, v. Wilber HENDERSON, Appellant.

Supreme Court of Oregon, Department 1.

Argued and Submitted Dec. 7, 1960.

Decided April 12, 1961.

Donald W. McEwen, Portland, argued the cause for appellant. On the brief were Cake, Jaureguy, Hardy, Buttler & McEwen, Portland.

E. F. Bernard, Portland, argued the cause for respondent. On the brief were Bernard, Bernard, Edwards & Hurley, Portland.

Before McALLISTER, C. J., and ROSSMAN, PERRY, GOODWIN and KING, JJ.

ROSSMAN, Justice.

This is an appeal by the defendant, Wilber Henderson, a member of the Oregon Bar, from a decree of the circuit court which rendered an accounting of the business transacted by him and the plaintiff, Robert Treat Platt, during the period of July 7, 1952, to August 27, 1959, while the two were winding up the law partnership of which they were formerly the members. After the defendant, Henderson, appealed, the plaintiff, Platt, cross-appealed. Later Mr. Platt died. Although his estate has been entered as the respondent cross-appellant, when we use the word 'plaintiff' we will refer to Mr. Platt.

The partnership between Mr. Henderson and Mr. Platt was formed July 1, 1937. One other attorney became a partner at that time, but withdrew from the firm September 1, 1950, upon his appointment to a judicial office. The names of two other attorneys appeared in the firm name, but they served upon a salary basis. According to the findings of the circuit court, the partnership was dissolved July 7, 1952, when Mr. Henderson withdrew in the manner we will presently describe. Its office had been in the United States National Bank Building in Portland. When the partnership consisting of the three men was formed July 1, 1937, written articles of co-partnership were signed. When one of the three withdrew September 1, 1950, as above indicated, new articles were not drafted and signed. We believe that the two remaining partners deemed that the agreement which they had executed July 1, 1937, sufficed to govern their relationship.

Mr. Platt, who was 69 years of age when he entered the partnership with the defendant, had been for many years general counsel for the United States National Bank of Portland. Mr. Henderson was 19 years younger than Mr. Platt and was, at the time when he and Mr. Platt became partners, a member of a smaller firm. He and his partner in that firm became the partners of Mr. Platt, and thereupon the former firm was dissolved. Mr. Platt's principal work in the partnership consisted of taking care of the needs of the United States National Bank from which he received a monthly retainer that he deposited in the firm's bank account. The defendant, Mr. Henderson, handled as his main work the litigation which came to the firm.

We come now to the incidents which led to the dissolution of the partnership. The record indicates that the relationship between the plaintiff and the defendant lacked cordiality. Each respected the other's integrity, industry and ability, but the warm personal attachment which develops through the years and graces the relationship between partners in some law firms had not come forth in this one. Notwithstanding that fact, the evidence warrants a belief that the business of the firm was handled successfully. It affords no basis for a surmise that either of the partners ever thought of terminating the firm until March 26, 1952, when the two members became involved in a heated argument over a complaint which the defendant had drafted for use in an action he was preparing to file. As a witness he swore that he told the plaintiff in the course of the controversy that he was withdrawing from the firm and that the plaintiff should obtain some one else to do the work he was doing. He claims that the words which he used terminated the partnership, that is, terminated it on March 26, 1952. July 7, 1952, more than three months later, the defendant opened offices in the Failing Building and moved into them. The plaintiff had had no premonition of that development. At that time and without notice to the plaintiff the defendant formed a partnership with one of the attorneys who had served the firm upon a salary basis, but whose name was in the firm name. When he opened his new offices the defendant took from the quarters which he had occupied with the plaintiff until July 7, 1952, the files in forty or more matters that were pending and upon which some work had been done principally by the defendant. Those forty or so matters, apart from the bank's general business, constituted most of the major pending business of the firm. The answer filed by Mr. Henderson contains this averment:

'Upon defendant leaving the offices defendant formerly occupied with plaintiff, defendant, with the knowledge and consent of plaintiff, took with him all of the files, documents and papers incident to such business, for the purpose of continuing and completing such business; thereafter, defendant completed or is in the course of completing, all of the business then pending.'

The reply filed by Mr. Platt averred:

'The plaintiff admits that when the defendant left the offices which he occupied with the plaintiff that the defendant took with him files of the partnership business.'

The Findings of Fact stated:

'The defendant took with him various clients' files and 'cases' of clients then being handled by the firm. * * *'

The evidence discloses that the defendant did not request the plaintiff's permission before removing the files, nor did he leave behind a list of the items of business that he had taken. Likewise, he did not inquire of the plaintiff whether it was satisfactory to him for the defendant to do as he was doing. In fact, the defendant's removal of the files was made without the plaintiff's knowledge or consent.

When Mr. Henderson moved into the Failing Building he proceeded there with the practice of law and gave attention to the business which he had brought with him from the offices that he had formerly shared with the plaintiff. In completing the items of business that he brought with him he never consulted the plaintiff as to how they should be handled nor afforded him opportunity to participate in them. He did not seek a suggestion from the plaintiff as to the amount any client should be charged for the services nor report to the plaintiff upon the progress which he was making with any of the matters over which he had taken province. Some of the items had been well advanced toward completion when the defendant withdrew from the offices in the United States National Bank Building, but upon others hardly more than a start had been made.

Some of the business which the defendant took with him came from clients who had long regarded the plaintiff as their attorney; but, some was that of persons who had consulted the defendant previously, or who came to him as a result of a recommendation by a friend. No client voiced objections to the fact that the defendant had removed the files to a new office or complained because the two men were no longer together.

During the partnership the plaintiff had given most of his time to the bank of which he was general counsel. When Mr. Henderson withdrew from the firm Mr. Platt was 84 years of age. As a witness he stated more than once that his health was good and that he was fit to remain active in the practice. He hoped, following Mr. Henderson's departure, to find a capable trial attorney and continue to serve the bank as general counsel. He viewed with disfavor the inactivity that results from retirement. He testified that in the past the bank had made to him retirement offers but that he had rejected them because 'I preferred to work.' A few days after Mr. Henderson withdrew and took with him a member of the staff the bank offered Mr. Platt a pension plan which appealed to him. It included the occupancy of a suite of two rooms in the United States National Bank Building and a continuance of his status as chairman of one of the bank's committees. His retention in the post of committee chairman would give him a duty to perform one day each week upon a salary basis. Mr. Platt accepted the offer and on July 31, 1952, ceased being the bank's attorney. In testifying, the mentioned a client whose business he was able to retain. During the trial he still maintained his offices in the United States National Bank Building.

Apart from one item, the foregoing delineates sufficiently for present purposes the nature of the practice conducted by the firm and the circumstances which terminated it. The additional item that needs mention is the appeal of a case entitled Barnes v. Eastern & Western Lumber Co. (After its appeal the case was reported in 205 Or. 553, 287 P.2d 929.) It had its inception when one, Mrs. Henry A. Buehner, who with associates owned 2500 shares of stock in the Eastern and Western Lumber Co., sold the stock to four members of the corporation's board of directors: Frank H. Ransom, Charles B. Duffy, K. H. Koehler and L. A. Morrison. Shortly, Mrs. Buehner claimed that the purchasers through fraudulent representations induced her to sell the stock at less than its value. She then filed the suit entitled Barnes v. Eastern and Western Lumber Co., and upon its trial recovered a judgment for approximately $1,000,000. At that juncture the attorneys who had represented Duffy, Koehler and Morrison inquired of Mr. Henderson whether he was available to appeal the judgment. Before replying he asked whether he was being selected on account of his connection with his firm and explained, 'If that is true, I do not believe I can take it, because I am not certain the firm is going to continue.' He was assured that his membership in the firm was not essential. After that answer was given it was agreed that the fee for services in appealing the case should be $30,000. Thereupon Mr. Henderson accepted the employment. April 23, 1952, Mr. Henderson...