Smith v. Craft

• Decision Date: 10 October 1900
• Citation: 58 S.W. 500
• Parties: SMITH et al. v. CRAFT et al. SMITH v. MINERAL RIDGE MFG. CO.
• Court: Kentucky Court of Appeals

58 S.W. 500

SMITH et al. v. CRAFT et al.

SMITH v. MINERAL RIDGE MFG. CO. ^[1]

Court of Appeals of Kentucky.

October 10, 1900

Appeal from circuit court, Laurel county.

"Not to be officially reported."

Action by the Mineral Ridge Manufacturing Company against the Welsh Coal Company and others to have certain acts of the Welsh Coal Company declared to operate as an assignment for the benefit of creditors. Judgment rejecting certain claims of J D. Smith, and he appeals; and order allowing attorney's fees to J. A. Craft and others, and J. D. Smith and others appeal. Reversed.

Strother & Gordon and C. P. Chenault, for appellants.

W. H Holt, J. A. Craft, J. W. Alcorn, and J. B. Paxton, for appellees.

WHITE J.

These two appeals are here upon one record, and present the questions as to the allowance to appellees Craft and others as attorney's fees, and also the refusal of the court below to allow certain claims that had been assigned to appellant Smith at their full face value; the court adjudging that Smith could only recover of the assets of the Welsh Coal Company the amount paid by him for such claims, and not the full face value thereof. In April, 1900, more than two years after the rendition of the judgment appealed from, the appellants offered to file an amended statement naming as appellees certain creditors of the Welsh Coal Company who had become parties to the proceedings below by filing their claims, and also making the debtor, the Welsh Coal Company, a party. Appellees objected to this amended statement because it is presented too-late, after the limit for an appeal had expired. The objection is well taken; for, if those sought to be added as appellees were not already parties to the appeal and bound by it, no appeal could be prosecuted after the expiration of two years that could affect their rights.

However as the action was to declare certain acts of the debtor, the Welsh Coal Company, a preference under the act of 1856, and to operate as an assignment for the benefit of all creditors, and was instituted and prosecuted to judgment by the Mineral Ridge Manufacturing Company, the judgment thus obtained inured to the benefit of all the creditors of Welsh Coal Company. The various creditors of the Welsh Coal Company, taking under the judgment in the name of the Mineral Ridge Manufacturing Company, need not be made parties appellee on appeal, but would be bound by any judgment or decree rendered on a reversal of the judgment where the Mineral Ridge Manufacturing Company would be bound. The creditors derive their rights through the action of the Mineral Ridge Manufacturing Company, and are entitled in that action only to such rights as are finally adjudged to the party obtaining the judgment.

The question that arises on the merits of the case, as it affects the appellees Craft and others, is the allowance to them of $3,270 as fees for their services as attorneys for the creditors of the Welsh Coal Company in procuring the judgment declaring the assignment of that company. We are of opinion that the appellees Craft et al. are entitled to a reasonable allowance out of the estate of the Welsh Coal Company for their services as attorneys. Lyford's Ex'x v. Haines (Ky.) 53 S.W. 646; Strobel v. Boresig (Super. Ct.) 13 Ky. Law Rep. 398.

In our opinion, however, the amount, $3,270, allowed is excessive. We conclude from the record, which is a full and complete transcript of all the pleadings and steps in this equitable case, that a reasonable allowance to appellees for legal services would be $2,000, to be paid out of the estate of the Welsh Coal Company, adjudged to the creditors pro rata on their claims, which sum will be allowed on the return of the case.

The question on the appeal of Smith, as against the Mineral Ridge Manufacturing Company, is as to certain claims brought by Smith against the Welsh Coal Company. Smith is an attorney and as such had certain claims of the Welsh Coal Company for collection. Smith is also president and principal stockholder in the Pittsburg Coal Company. It appears that some time after the Welsh Coal Company had sold out its plant and outfit to the Pittsburg Coal Company for a number of shares of stock in the Pittsburg Coal Company, and after certain...