Wittich v. O'Neal

The Chief Justice delivered the opinion of the court: The questions presented by the record are: 1st. In ¡a suit on the bond given to obtain a temporary injunction are counsel fees, incurred to dissolve the injunction, damages that may be recovered ? 2d. Is it essential that the plaintifi in such suit should have actually paid such fees, or is it sufficient that he has become liable therefor ? The record shows that a temporary injunction was issued in a suit then pending between the surviving partners of the firm of Keyser, Judah & Co., and W. L. Wittich, and that the injunction was dissolved “ by the judge of said court upon the application of the defendant in said suit, the plaintiff herein,” on the 6th April, 1881, and that on the 9th day of April, 1885, a final decree was rendered the suit dismissing the bill therein. The appellees were securities on the injunction bond, the condition of which is that if the obligors “ shall pay to — 596 — the said W. L. Witticli all damages he may sustain by the issuing of said injunction in case the injunction be hereafter dissolved, then this obligation to be void.” If the plaintiff was compelled to employ counsel to dissolve the temporary injunction, it is clear that he was damaged to that extent, and the question above mentioned arises as to whether such damages are recoverable or not. In the case of Ah Thaie vs. Quan Wan & Kan Se, 3 Cal., 216, the complaint stated that on the 28th of May, 1853, one Chin Lan and Ah Lee filed a complaint against the plaintiff, and sued out a writ of injunction against the plaintiff; that to obtain the same the defendants executed a bond for $8,100, to pay the plaintiff such damages as he might sustain by reason thereof; that the plaintiff was obliged to procure counsel to obtain a dissolution of such injunction at the cost of $1,200. Defendants demurred and assigned for cause the charge of $1,200 paid counsel. The court held: “ The language of the condition of the bond .is undoubtedly broad enough to embrace the necessary counsel fees, which the defendants have been obliged to pay out in order to procure the dissolution of the injunction. The necessity of paying such counsel fees is an actual damage that the defendant has sustained in defending himself and procuring a dissolution of the injunction, and the condition of the bond is imperative that the obligors “ shall pay to the parties injured such damages as they may sustain by reason of the injunction.” “ It appears to us that the principle is not only just in equity, but sound in law, that all the damages to which a party may be put by the wrongful issuance of an injunction should be recoverable in action on the bond, and reasonable counsel fees should be included in those damages, of course, leaving the amount to be assessed'by the jury.” The court cited in this case the decision of Chancellor Walworth, in Edwards — 597 — vs. Bodine, 11 Paige Chancery Reports, 224, 225. The same principle has been upheld in the following cases. Darby Bank vs. Heath, 45 N. H., 524; Collins vs. Sinclair, 51 Ill., 328 ; Behrens vs. McKensie, 23 Iowa, 341; Reece vs. Northway, 58 Iowa, 137; Brown vs. Jones, 5 Nevada, 374, 377 ; Livingston vs. Exum, 19 South Carolina, pp. 223, 229. Many other cases might be cited to the same effect. Appellees very frankly admit the “ courts of last resort in most of the States have decided the question in this cause against their position,” but they plant themselves with confidence on the decision of the United States Supreme Court in Oelrichs vs. Spain, 15 Wallace, 211, which has been followed by the other. Federal Courts, and some of the State Supreme Courts. The language of the Supreme Court, on the question, is as follows: “ The point here in question has never been expressly decided by this court, but it is clearly within the reasoning of the case last referred to, and we think is substantially determined by that adjudication. In debt, covenant and assumpsit, damages are recovered, but counsel fees are never included. So in equity cases, where there is no injunction bond, only the taxable costs are allowed to the complainants. The same rule is applied to the defendants, however unjust the litigation on the other side, and however large the expensa litis to which he may have been subjected. The parties in this respect are upon a footing of equality. There is no fixed standard by which the honorarium can be measured. Some counsel demand much more than others. Some clients are willing to pay more than others. More counsel may be employed than are necessary. When both client and counsel know that the fees are to be paid by the other party there is danger of abuse. A reference to a- master, or an issue to a jury, might be necessary to ascertain the proper amount, and this grafted litigation might possibly — 598 — be more animated and protracted than that in the original cause. It would be an office of some delicacy on the part of the court to scale down the charges, as might Sometimes be necessary.” “We think the principle of disallowance rests on a solid foundation, and that the opposite rule is forbidden by the analogies of the law and sound public policy.” The cases of Oliphant vs. Mansfield, 36 Ark., 191, and Wood et al. vs. State, for use of White, Court of Appeals of Maryland, July 15th, 1886, are based on Oelrichs vs. Spain, and contain no argument or reason that is not found in said case. Against such an array and weight of authority as sustain the conclusion of the court, as expressed in 3 California, 216, in favor of the principle that attorney fees are recoverable in a suit on an injunction bond, we are loth to follow the few authorities that hold the contrary, in the absence of some controlling argument or reason that would convince our judgments of the correctness of these conclusions. The reasons set forth in Oelrichs vs. Spain are to our minds not satisfactory, and we think are fully answered in the brief of counsel for appellant. What would be the rule where a bill was filed to enjoin a defendant from the performance of some act or the enjoyment of some right, and the temporary injunction was dissolved after a trial of the main suit by virtue of the judgment therein, we express no opinion. The authorities that hold that counsel fees are recoverable differ as to whether they are recoverable in such a case. The case at bar is one in which the main suit was pending ; a temporary injunction was issued and dissolved on the application of the plaintiff in this suit before a determination of the main suit. In such a case the temporary injunction is an extraordinary remedy. Unlike the usual — 599 — course of law, which “ proceeds upon inquiry and- only condemns after a hearing,”. it is often ex parte and condemns temporarily before a hearing. It seems just and right that where a party asks the interposition of the power of the courts, in advance of a trial of the merits of the cause, to deprive the defendant of some right or privilege claimed by him, even though temporarily, that if on investigation it is found that the plaintiff had no just right either in the law or the facts to justify him in asking and obtaining from the court such a harsh and drastic exercise of its authority, that he should indemnify the defendant in the language of his bond for “ all damages he might sustain,” and that reasonable counsel fees necessary to the recovering of such injunction are properly a part of his damage. The remaining question is, a liability for the payment of counsel fees sufficient, or must they have been actually paid? Counsel for appellee cites us to two cases, Packer vs. Nevin, 67 N. Y., 550, and Prader vs. Grimm, 28 Cal., 11. In the first of these cases this question was not before the court. “ A preliminary injunction was obtained and upon agreement of the parties it was ordered that the question of defendant’s damages, if any, sustained by reason of the injunction, be heard and determined, jointly with the issues, by the referee. Ko evidence of damage of any kind was given on the trial, no finding of facts was made by the referee in regard thereto, nor were any requests made to find.” The court said “ .that it was not imperative for the referee to make an allowance for counsel fees without proof of payment, or that a liability had been incurred therefor.” The California case cited squarely sustains the position of the appellee, but we think the great weight of authority maintains the principle that a fixed liability is sufficient without actual payment. In the case of Underhill vs. Spencer, 25 Kansas, 71, 73, the court say: “ The other ques — 600 — tion is, whether the defendant in the injunction suit can recover the fees of his attorney for services in obtaining a dissolution of the injunction before he has paid them. In this Case the amount was agreed upon and the sum was reasonable. The defendant’s liability was absolute, but the fees had not in fact been paid. With perhaps the single exception of California, the authorities agree that if the liability is fixed and absolute, it is enough; payment is not an essential pre-requisite. Garrett vs. Logan, 19 Ala., 344; Miller vs. Garrett, 35 Ala., 96 ; McRae vs. Brown, 12 La. Ann., 181; Brown vs. Jones, 5 Nev., 374 ; Noble vs. Arnold, 23 Ohio St., 264; 2 High on Injunctions, 1685 ; Shultz vs. Morrison, 3 Metc., (Ky.) 98 ; Steele vs. Thatcher, 56 Ill., 257.” We do not wish to be understood as holding that the defendant and his attorney can fix the fee which the plaintiff in the injunction suit must pay. - Such fees must be reasonable and- proportionate to the value of the services to the defendant and the skill shown and work done by the counsel. Judgment reversed and cause remanded.