Southworth v. Rosendahl
| Decision Date | 07 July 1916 |
| Docket Number | 19,830 - (206) |
| Citation | 158 N.W. 717,133 Minn. 447 |
| Parties | WALTER N. SOUTHWORTH AND ANOTHER v. OLE ROSENDAHL |
| Court | Minnesota Supreme Court |
Action in the district court for Scott county by Walter N Southworth and F. J. Leonard to recover $10,000 for services as attorneys and counselors at law. The case was tried before Morrison, J., and a jury which returned a verdict in favor of defendant. From the order denying their motion for a new trial, plaintiffs appealed. Affirmed.
Attorney and client -- settlement by client -- contingent fee not payable.
1. The relation of attorney and client does not preclude the latter from settling and compromising the matters in litigation in his own way, and without the knowledge or consent of the attorney, and by so doing he does not subject himself to the payment to the attorney of a contingent fee agreed upon in case of the successful outcome of the case.
Attorney and client -- reasonable value of services recoverable.
2. Where the client exercises his legal right to settle with his adversary, in good faith and without purpose to defraud the attorney out of his compensation, the latter may recover only the reasonable value of the services rendered by him down to the time of the settlement.
W. N Southworth and F. J. Leonard, pro se.
Joseph J. Moriarty and W. H. Leeman, for respondent.
The facts in this case, though in some respects disputed or left in doubt by the evidence, may for the purposes of the decision be conceded to be substantially as follows: Defendant was the owner of certain real property, the title to which was somewhat involved, the particulars with respect to which are immaterial, and certain litigation was pending in the courts concerning the same in which he was plaintiff. Plaintiffs in this action, attorneys at law, were retained by him to take charge of and conduct the litigation in his behalf, and to institute such other or further actions or proceedings as the attorneys should deem necessary to the protection of his rights in and to the property. Plaintiffs claim that at the time of such retainer it was expressly agreed that, if successful in the litigation, they should receive and defendant would pay them as and for their compensation the sum of $10,000; but if they failed in their efforts to clear up defendant's title they should receive no compensation at all. The property involved was valued at about $100,000. There is no controversy in the evidence as to the employment of plaintiffs to conduct the litigation, though defendant denied that he agreed to pay them $10,000 if they were successful in the suit. But, for the purposes of the case, we assume that he did so agree. Subsequent to the retainer plaintiffs rendered certain services in the pending action, the nature and extent of which do not fully appear and are not important. Thereafter and without notice to plaintiffs or either of them, defendant amicably settled and compromised the matter in litigation with the adverse party, and the litigation was thus brought to an end, dispensing with the further services of plaintiffs. Plaintiffs then brought this action to recover the amount of the agreed compensation, namely, $10,000. A verdict was returned for defendant and plaintiffs appealed from an order denying a new trial.
The assignments of error challenge certain rulings of the court in the admission and exclusion of evidence, and certain parts of the charge to the jury, but as our conclusion upon the main question involved is adverse to the right of plaintiffs to recover and completely disposes of the case on the merits, it becomes unnecessary to consider them. We therefore limit our consideration of the case to the question whether plaintiffs, under the facts stated, are entitled to recover upon the express contract, or whether their remedy is in quantum meruit, for the reasonable value of their services.
It is well settled that a client may, without the consent of his attorney, settle and compromise with his adversary all matters in litigation, in such manner and upon such terms as he may deem necessary for the protection of his interests. Boogran v. St. Paul City Ry. Co. 97 Minn. 51, 106 N.W. 104, 3 L.R.A. (N.S.) 379, 114 Am. St. 691; Paulson v. Lyson, 12 N.D. 354, 97 N.W. 533, 1 Ann. Cas. 245; 2 R.C.L. p. 1000, § 80, and p. 1080, § 171. No vested right of the attorney is violated or impaired, and the rule applies notwithstanding an express agreement with the attorney that he will not settle or compromise without his consent or approval. 6 C.J. p. 743, § 318; Huber v. Johnson, 68 Minn. 74, 70 N.W. 806, 64 Am. St. 456. The late Justice Mitchell tersely stated the rule in the case just cited as follows:
Plaintiffs do not question the rule, nor its application, and the case involves no controversy respecting the legal right of a client to settle his dispute with his adversary in his own way in all cases, and we have only to consider whether plaintiffs are entitled to the agreed compensation.
The authorities are not in harmony upon the question. It has been held by some of the courts that where an attorney is employed for a particular litigated controversy with an agreement for a fixed compensation in the event of a successful termination of the case, and thereafter the client, without cause or justifiable reason, discharges the attorney and employs another who proceeds with the matter to a successful end, the attorney is entitled to the agreed compensation. Moyer v. Cantieny, 41 Minn. 242, 42 N.W. 1060; Brodie v. Watkins, 33 Ark. 545, 34 Am Rep. 49; Webb v. Trescony, 76 Cal. 621, 18 P. 796; Kersey v. Garton, 77 Mo. 645; 2 Thornton, Attorneys at Law, § 450. This doctrine finds support and in fact is founded upon the general principle of liability where one party to an executory contract wrongfully prevents the other from performing the same. But the rule can have no application to the case at bar, for there was no wrong as against plaintiffs in the act of defendant in compromising the matters in dispute with the adverse party. Plaintiffs' contract of employment was subject to an exercise of that right by defendant. The Cantieny case, supra, upon which plaintiffs to some extent rely, is not controlling, for there the attorney was discharged by the client, and the case was thus brought within the general rule of liability just referred to. There are, however, authorities which directly support the contention that the attorney is entitled to the agreed compensation in the case of a settlement by the client as well as in the case of a wrongful discharge of the attorney. Cheshire v. Des Moines City Ry. Co. 153 Iowa 88, 133 N.W. 324;...
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