Mohawk Bank v. Burrows

The Chancellor. The doctrine of the Court of Cornmon Pleas, and of the Court of Chancery, in England, and of the Supreme Court of this state, is, that the attorney’s or solicitor’s lien for costs does not prevent the parties from having their mutual demands arranged by set-off, as the equities between them shall require, without regard to the lien of the attorney or solicitor. In Vaughan v. Davies, (2 H. Bl. 440.) A. obtained a verdict against B. for a small sum, and B. obtained a judg [319] ment against A. for a large sum, and the Court permitted the verdict and costs recovered by A. to be deducted from the amount of the judgment of B., notwithstanding A., was insolvent, and had no means of paying his attorney’s bill, but by the sum for which he obtained a verdict, and notwithstanding that the attorney for A. had no fund to resort to for his costs but the sum recovered by his client. It was admitted, in that case, that the practice of the K. B. was different, and the equitable right-of setting off the sum recovered in one action against that recovered in another, was always subject to the attorney’s lien for his bill, and for which the case oí Mitchell v. Oldfield, (4 Term Rep. 123.) was referred to. This was a very strong case on the point, and it was, afterwards, followed in the cases of Hall v. Ody, (2 B. & Pull. 28.) and Emden v. Dailey, (4 B. & Pull. 22.) But in the first of these two last mentioned .cases, Lord Ch. J. Eldon seemed to hesitate as to the practice, and observed, that “ he found this to be the settled practice of the C. B. with much surprise, since it stood in direct contradiction to the practice of every other Court, as well as to the principles of justice. In the Court of Chancery, the same parties were often concerned in many suits, and he never knew the idea entertained of arranging the funds, untikthe respective attorneys were paid their costs.” The other Judges of the C. B. dryly observed,that they had no objection to have the practice reconsidered; but RooJce,■ J. said, “ It did not appear to him to be unfair as it stood at present. The attorney looks, in the first instance, to the personal security of his client, and if beyond that he can get any further security into his hands, it is a mere casual advantage.” The last of these cases, was after Sir James Mansfield bad succeeded as Ch. J. and the Court of Common Pleas adhered to their former practice as settled, and held, that the attorney’s lien could not be allowed to interfere with the equitable arrangement of costs between the [320] parties to the suit; that the attorney acts upon the credit of his client, and his personal security for the payment of his costs, and that the Court always allowed applications that kind. In Porter v. Lane, (8 Johns. Rep. 357.) the Supreme Court of this state declared, that they adopted the rule of the C. B., and that the attorney’s lien for his costs did not affect the equitable right of set-off between the parties. The rule in Chancery is the same. In the case of Vaughan v. Davies, cited above, Mr. J. Buller observed, that a similar decision to this had taken place that very term in the Court of Chancery, in Barton v. Etherington. Lord Hardwicke had said, long before, (Garish v. Donovan, 2 Atk. 166.) that it was very reasonable that the costs which the plaintiff had to pay, on dismissing his bill, should be deducted out of the costs and damages which the plaintiff had recovered at law against the defendant, and for which the defendant had been taken in execution, and there remained. I have not seen any report of the decision alluded to by Mr. J. Buller; but Lord Eldon, since he became Chancellor, has repeatedly admitted the Chancery rule to be the same with that of the C. B., which he so precipitately, and contrary to his usual discretion and accuracy, called in question when he was Ch. J. of that Court. In Taylor v. Popham, (15 Ves. 79.) Lord Ch. Eldon stated, that he “ had a strong notion that the doctrine of that Court has all along been, that where different demands arise in a cause, the costs should be arranged as the equities between the parties require, without considering the solicitor.” And in the case Ex parte Rhodes, (15 Ves. 541.) he stated more decidedly the rule in Chancery. The right of set-off, he said, prevailed, in general cases, so as to interfere with the solicitor’s lien upon the debt recovered. The Court of K. B. held, that the equity of set-off should not interfere with the lien. The Court [321] of Common Pleas, on the contrary, held, that the attorney can have no lien that will interfere with the equity between the parties; “ and, my opinion is, that the practice of this Court does not interpose the lien further than upon the clear balance which is the result of the equity between the parties. This is proved by the whole form of our proceedings.” The practice which has been thus shown to exist, and to be established by such a preponderating weight of authority, must be deemed the rule in this Court; and the only pertinent inquiry is, whether the circumstances of this case warrant the application of the rule. Burrows, in his answer to the bill, admitted, “ that Pan JYess and he purchased, on the 30th of May, 1817, the factory and lands belonging to it, for about 10,000 dollars; and that they gave their joint bond and mortgage to the Mohawk Bank for 9669 dollars and 76 cents, part of the purchase money. That he was owner of half the factory as a tenant in common, and that he made improvements on the factory to more than the amount of his half of the original purchase money secured by the mortgage. That when he purchased, it was an agreement between him and Van JYess, that the factory should be conducted, improved, and carried on at joint expense, and the defendant B. attempted to perform his part, and made repairs and improvements of great value, but Van JYess and his executors refused to join him in such expenses and improvements, to his great damage.” It would appear from those charges, put forward in the answer, that the question of contribution between the executors of Van JYess and the defendant, B., is quite unsettled, and the claim of the executors will be contested, and must undergo a course of judicial investigation, before it is established, and its extent ascertained. 1 believe none of the cases require a suspension of the operation of the attorney’s or solicitor’s lien upon the costs already recovered, until an unliquidated [322] claim of the opposite party can be settled. The claims on each side must be ascertained before the set-off can be admitted. It would be unreasonable to delay the solicitor until the accounts between the parties can be stated, and the balance struck. As was observed in the case of Duncan v. Lyon, (3 Johns. Ch. Rep. 360.) “ one judgment may be set off against another; but here is a demand on one side raised to a debt certain, and an uncertain claim on the other, and there is no case to warrant the delay of satisfaction of a judgment debt on one side, until an unsettled demand on the other is reduced to certainty, and in a condition to be set off.” On this ground, I am of opinion, that the prayer of the petition be denied. Motion denied.