Weller v. Jersey City, H. & P. St. Ry. Co.

• Citation: 57 A. 730,66 N.H. 11
• Parties: WELLER et al. v. JERSEY CITY, H. & P. ST. RY. CO.
• Decision Date: 12 April 1904
• Court: New Jersey Court of Chancery

57 A. 730

66 N.E. 11

WELLER et al.

v. JERSEY CITY, H. & P. ST. RY. CO.

Court of Chancery of New Jersey.

April 12, 1904.

(Syllabus by the Court.)

Bill by John I. Welier and others against the Jersey City, Hoboken & Peterson Street Railway Company. Demurrer to bill sustained.

It alleges that both complainants are licensed attorneys at law, and that John I. Welier is a licensed counselor at law of this state. The bill states that in November, 1902, John Meffert while a passenger on one of the cars of the defendant company, was injured by its negligence, whereby a cause of action accrued to him to recover damages for such injuries. It further states that in said, month said Meffert retained complainants, in writing, to settle with said company, or to commence an action for him against said company for said damages;, that said Meffert had no money to pay complainants for their services in the action, or the costs of the suit, and therefore, by said writing, in consideration of the services to be performed by the complainants, and for other consideration, agreed to pay complainants 50 per centum of whatever might be recovered from said company, by suit, settlement, or otherwise, for said injuries, and sold, assigned, and transferred unto the complainants 50 per centum of all that might be recovered by suit, settlement, or otherwise for said injuries; and that Meffert thereby also agreed not to settle his said claim with said company, nor to discontinue any action which complainants might commence against said company. The bill further states that on December 17, 1902, they commenced an action in the Supreme Court, in the name of said Meffert, against said company, to recover $5,000 damages for said injuries, and afterwards filed a declaration in the cause, and noticed the same for trial. The bill further states that on December 12, 1902, they caused to be served upon the president of the said company a notice in writing that complainants had been retained by Meffert to prosecute his action against the company for said injuries, and the notice also informed the company that said Meffert had agreed with complainants not to settle or release his claim against the company, and that the complainants claimed an interest in whatever moneys might then be due, or might thereafter become due or be paid to said Meffert, or be recovered by him for said injuries, by reason of an assignment made by him to complainants. The bill further states that on or about March 1, 1903, said company adjusted and settled the claim and cause of action said Meffert had against it, by paying him a sum of money, the amount of which complainants assert they have no means of knowing, and that complainants are informed and believe that said Meffert signed and delivered to said company a release under seal, releasing said company from all action and damages by reason of the injuries received by him as set forth in the bill. The bill thereupon alleges that, when said company settled said claim, a trust of the proportion of the money so assigned to complainants resulted in their favor, and the said company became the trustee of complainants for 50 per cent. of the money for which said Meffert's claim was adjusted and settled. The bill further charges that said Meffert is financially irresponsible, and possesses no property from which a judgment recovered against him for a breach of his contract with complainants could be collected. The bill further charges that one Christian Branger and one Hairy S. Van Valet had similar claims against said company, and retained complainants by a retainer and assignment in writing such as was asserted to have been made between Meffert and complainants, of which retainer and assignment the company received written notice, and that said company, notwithstanding such notice, compromised and settled the respective claims of said Branger and Van Valen, and took releases from them therefor. It is asserted that Branger and Van Valen are both of them financially irresponsible, and it is charged that the company thereby became a trustee for complainants, and liable to account to them for one-half of the sums respectively paid to Branger and Van Valen. Upon these statements, the prayers of the bill are for an answer without oath, and for discovery of the amount paid in the respective settlements of the claims set out in the bill, and that the defendant company shall account to the complainants for the money respectively paid by it to the three persons above named, in consideration of the settlement of their respective claims, and that said company may be decreed to pay to complainants a sum equal to one-half of the moneys paid upon said compromises and settlements, respectively. Process is prayed against the said company only. To this bill defendant demurs on the ground of want of equity.

John I. Welier, for complainants.

William B. Gourley, for defendant.

MAGIE, Ch. (after stating the facts). The demurrer to this bill is supported upon the sole ground of a want of equity. It is not contended that the bill is defective in failing to bring before the court the different persons who it alleges had valid claims upon the defendant company, which were assigned to the complainants, and form the basis of their claim. Nor has there been any contention that the bill is multifarious, in that it has sought relief upon three several, distinct, and unconnected claims. The sole contention of the complainants in support of the bill is that by the written retainers and assignments of persons having claims against the defendant company for personal injuries, and by timely notice thereof to the company, complainants became, in equity, assignees of the proportionate parts of any sums which such injured persons should thereafter receive from the defendant company, either by a composition between them, or by a recovery and judgment in actions at law, and that a trust thereupon arose, binding the defendant company, and making it accountable in equity to the complainants for their proportionate parts thereof. There is no attempt to support the bill in respect to any part of complainants' claims on the ground of what has been incorrectly styled the "attorney's lien," and it is obvious that such a contention would have been unavailable, because it is well settled that such lien arises only after judgment recovered, or after the proceeds of a compromise or settlement have come to the actual possession of the attorney. Jones on Liens, §§ 140-149; Terney v. Wilson, 45 N. J. Law, 282; Phillips v. MacKay, 54 N. J. Law, 319, 23 Atl. 941; Barnes v. Taylor, 30 N. J. Eq. 467; Middlesex Freeholders v. State Bank, 38 N. J. Eq. 36.

The sole question therefore is (and it seems to be one of first impression in this state) whether, when an attorney retained by a person injured by the tort of another has procured from the injured person an assignment of a proportion of the damages which may be recovered by action or judgment, or received by compromise or settlement, and has given notice of such assignment to the tort feasor, there is raised thereby an obligation on the part of the tort feasor to account to the attorney, as such assignee, for the proportion of a sum which the tort feasor has paid to the injured person as compensation for the injury, and as satisfaction therefor agreed upon between them, and which obligation can be enforced by the decree of a court of equity. It is observable that the bill does not disclose any contract on the part of complainants with the persons from whom they...