Embry v. Palmer

The plaintiff in error, in January, 1872, brought his action in the supreme court of the District of Columbia, against Stanton and Palmer, to recover compensation for professional services alleged to have been rendered, in their behalf and at their request, by his intestate, Robert J. Atkinson, in prosecuting and recovering for them the amount of certain claims in their favor against the United States. In this action the defendants appeared and defended, and judgment was rendered against them upon a verdict for $9,185.18. Upon a writ of error, issued out of this court, this judgment was affirmed, upon grounds which appear in the report of the case. Stanton v. Embry, 93 U.S. 548.

Subsequently, in 1877, the plaintiff in error brought his action upon this judgment against the defendants, in the superior court for New London county, Connecticut, where they resided, in order to obtain judgment and execution thereof in that state. Thereupon Stanton and Palmer, the defendants thereto, filed their petition in equity in the same court, the object and prayer of which were to obtain a perpetual injunction, restraining the plaintiff from prosecuting his action upon that judgment, or from in any manner enforcing it against the petitioners, upon the payment by them of $2,296.25, which they allege was as much as he was equitably entitled to on account of the causes of action on which the judgment had been rendered.

The grounds of relief, alleged in this petition, may be shortly but sufficiently stated, as follows, viz.: That the claim in question was for collecting from the United States the sum of $45,925.91, under a special written agreement for a compensation to Atkinson of 5 per cent. on that amount, the existence of which was well known to the plaintiff in error when he brought his suit in the supreme court of the District of Columbia; that when Embry, as administrator of Atkinson, first presented the account to the petitioners for payment, it was for $2,296.29, being at that rate; that Stanton and Palmer, claiming to have a good defense against it, declined to pay it, when Embry thereupon brought suit for that amount, in Connecticut, in 1871, which he discontinued in 1872, and, during its pendency, brought the action in which the judgment complained of was rendered, in which he ignored the special agreement, and sued upon a quantum meruit; that Palmer, one of the defendants, at the time of the trial was absent from the District of Columbia, and was not notified of the day of trial in time to be present; that Stanton, though present in Washington at the time, was unable to attend the trial on account of sickness; that since the trial Stanton, on examination, had found among his papers two letters from Atkinson, in which the latter expressly acknowledged the existence of the special contract for fees at 5 per cent., as claimed, but they were discovered too late for use on the trial; and that Embry, in suppressing his knowledge of the existence of this contract, and in procuring a judgment for a larger sum, was guilty of fraud, which made it inequitable in him to enforce the judgment to its full extent.

A general demurrer to this petition was reserved to the supreme court of errors of Connecticut for its advice, and was overruled, that court being of opinion that the petition was sufficient. Its decision is reported in 46 Conn. 65, treating the case made in the petition as one of fraud in procuring an unjust judgment, admitted by the demurrer.

The defendant Embry then filed his answer to the petition, in which he denied that he made out the account as origmally presented, at the rate of 5 per cent. on the amount collected, to conform to any agreement between the parties, but because he found from Atkinson's books that he had charged at that rate in other cases, and without considering the difference of value in the services rendered in them; and that Atkinson kept no copies of the letters written to the petitioners. He claims that the question, whether there was any contract between the parties, and if so, what were its terms, was fully tried and finally decided in the action, which resulted in the judgment complained of, and which he sets up as an estoppel. He denies that he then or any time knew of any contract between the parties as to fees, and claims that if the defendants failed in that action to substantiate a defense, it was through their own laches, and not by reason of any fraud on his part.

In accordance with the practice in that state, the cause was referred to a committee, whose report of the facts constitutes part of the record, from which the following extract is taken:

'At [the time of] the trial of this case at Washington neither Mr. Stanton nor Palmer were present in court. Mr. Palmer was at Stonington. His attendance might have been secured by reasonable diligence, if such attendance had been deemed very important. Mr. Stanton was ill at his hotel in Washington-too ill to attend the trial. His counsel asked for a postponement on that account, but no affidavit was offered in support of the motion, and it was denied. The petitioner's counsel appears to have been content to proceed with the trial in the absence of his clients. He had full and, as it turned out, undue confidence in the legal defenses which appear by the record to have been set up at the trial, and took it for granted that in no event could more be recovered than $2,296.29. The letters of Mr. Atkinson of February 18, 1870, and May 7, 1870, recognizing the special agreement for 5 per cent. on claim D, were not in Washington at the trial there; they were received by Mr. Stanton, the active partner, at a time when his mind was much depressed; they were stored for safe-keeping at his home in Stonington, Connecticut, and the contents had escaped his recollection; they were not found by him until after the trial and disposal of the case at the general term.

'After the commencement of the suit at Washington he made search for all letters and papers relating to the case, and placed in possession of his counsel such as he found; and he then supposed that he had found and placed in the hands of counsel all the letters and papers pertaining to the matters in suit. As bearing on the question how it happened that these letters escaped the recollection of Mr. Stanton, it appears that for several reasons the attention of the petitioners was not alive to the importance of being prepared at the trial in Washington with the proof of the special agreement which the letters furnished: (1) Because the petitioners took it for granted that the full extent of the plaintiff's claim at the trial would be $2,296.29, that being the amount of the claim, D, presented through Mr. Pratt, and it did not occur to them that a larger amount might be claimed under the quantum meruit count; (2) because their counsel had undue confidence in legal defenses against the entire demand, and therefore did not apprehend the full importance to the interests of his clients of being prepared with proof of the special agreement.

'As to specification 7, in the petition, Mr. Atkinson, while living, had full knowledge that the amount due him was but $2,296.29, on a special contract for that amount, and he, if living, could not, with a good conscience, have presented a claim for a greater amount. Mr. Embry, the administrator, knew that Messrs. Stanton and Palmer claimed a special contract, and was willing before trial was brought to settle on that basis; but his claim in court on a quantum meruit was not on his part an intentional suggestio falsi. He did not know that the claim was unfounded; the full proof of the special agreement was not in his possession, and had not been fully brought to his knowledge.'

What decree should be passed in the cause upon this report was reserved for the action of of the supreme court of errors, which court, after argument, advised that the prayer of the petition be granted, on condition that the petitioners pay to the respondent the sum of $2,296.29, within a reasonable time to be fixed, with interest thereon from March 10, 1871, which was accordingly so ordered, and the said sum of money having thereupon been paid by the petitioners to the attorney of the respondent, and received by him, with the interest thereon, it was ordered and decreed by the supreme court that Embry be enjoined, under a penalty of $20,000, payable to the petitioners, to abstain and desist from the further prosecution of his suit upon the judgment, and from instituting any other suit or action thereon, or from executing or in any manner enforcing the same against the petitioners.

Proceedings in error were taken in due form to review this judgment in the supreme court of errors of the state, it being assigned for error 'that the judgment and decree is in contravention of article 4, § 1, of the constitution of the United States, and section 905, c. 17, tit. 13, of the Revised Statutes of the United States, in that it enjoins the prosecution of a suit on a judgment of the supreme court of the District of Columbia,' and 'that the decree enjoins the collection of a judgment of a court of the United States.'

The opinion of the supreme court of errors in passing upon the case as presented by the report of the committee, and advising as to the decree to be rendered thereon, is reported in 46 Conn. 595. The final decree entered in pursuance thereof, and affirmed by that court, is now brought into review in this court by writ of error.

E. Lander and A. L. Merriman, for plaintiff in error.

C. W. Hornor and J. Halsey, for defendants in error.

MATTHEWS, J.