Missouri, Kansas & Texas Railway Company v. Elliott

The action below was brought by Elliott in the state circuit court of Cooper county, Missouri, against the railway company, plaintiff in error herein. Recovery was sought upon an injunction bond given in an equity cause in a suit in the circuit court of the United States for the central division of the western district of Missouri. The railway company was complainant in the equity cause, and Elliott was defendant. The circuit court of the United States, as the result of a mandate of the circuit court of appeals, entered an order dissolving the injunction, and thereupon this action was equity cause, and Elliott was defendant. The were embraced in the condition of the bond were averred to consist of payments made for attorneys' fees, traveling and other similar expenses of the plaintiff, asserted to have been disbursed during the course of the litigation in the United States court.

The answer consisted of a general denial, and alleged that the equity suit in which the bond was given was made necessary to enable the defendant to make its defense to an action at law, which had prior to the equity suit been brought against the railway company by Elliott. The cause was tried by the court without a jury. It appeared on the trial that in dismissing the bill in the equity cause the statutory allowance to attorneys and other costs had been taxed, and paid by the complainants in the equity cause in the United States circuit court. No objection was interposed at the trial to evidence introduced for the plaintiff as to the value of attorneys' services and the other sums disbursed for the expenses alleged in the petition. At the close of the trial the court, over the objection of the defendant, declared the law to be that the plaintiff was entitled to recover his reasonable personal expenses and reasonable attorneys' fees incurred for the services of attorneys in procuring the dissolution of the injunction. The following, among other prayers asked by the defendant, were refused:

'2. The court declares the law to be that the plaintiff is not entitled to recover as damages on the injunction bond sued on any sum which he may have paid out or become liable for as attorneys' fees.'

'5. The court declares the law to be that the plaintiff, having received the amount taxed in his favor as attorneys' fees as part of the costs in the equity suit mentioned in the pleadings and evidence in this case, he cannot now recover anything on account of attorneys' fees in this case.' Judgment having been entered in favor of plaintiff and a motion for a new trial having been overruled, an appeal was taken to the Kansas City court of appeals, and the judgment was affirmed. In the course of its opinion the court recited the contentions of the defendant, and held each of them to be untenable. These contentions were thus stated by the court:

'1. Defendant's objections to the judgment below may be thus stated: First, that there was no breach of the conditions of the bond in that it was not alleged or proved that any damages had been previously adjudged against the defendant, whereas the condition of the bond is that defendant 'should pay all sums of money damages and costs that shall be adjudged against it,' etc.; and, secondly, it is contended that as the injunction bond was given in a proceeding pending in the United States court, the damages must be fixed and determined according to the rules and practice of the Federal courts; that attorneys' fees are not there considered elements of damage in suits on injunction bonds, and that therefore our state courts should apply the same rule in suits on bonds given in the Federal courts; and thirdly, it is insisted that the trial court erroneously allowed as damages attorneys' fees for defending the entire case-that the injunction was merely incidental to the principal case, and no attorneys' fees were paid to secure its dissolution.' [77 Mo. App. 659.]

A motion for a rehearing was thereafter filed, in which, among other things, it was contended that the cause involved a Federal question, 'for the reason that the controversy in this suit arises under the authority of the United States, and under the laws of the United States governing and applicable to United States courts,' and the court was asked in the event that it should refuse to grant a rehearing, to transfer the case to the supreme court of the state of Missouri, 'for the reason that a Federal question is involved, and because the subject of the controversy of this suit arises under the authority of the United States and under the exercise of such authority, and under the laws of the United States governing and controlling the courts of the United States and the proceedings therein.' The motion for a rehearing having been overruled, it appears from a stipulation contained in the record that an application was made to the supreme court of the state of Missouri for a writ of prohibition against the judges of the said Kansas City court of appeals to restrain the further exercise of jurisdiction in the cause, and to require the record and proceedings to be certified to the supreme court. This application was denied. 154 Mo. 300, 55 S. W. 470.

Thereupon the present writ of error was allowed, and the record of the cause was brought here from the Kansas City court of appeals.

Mr. George P. B. Jackson for plaintiff in error.

Mr. W. M. Williams submitted the case for defendant in error.

Mr. Justice White, after making the foregoing statement, delivered the opinion of the court: