Quigley v. Hammond

Wood, J., (after stating the facts). The findings of fact by the trial court are correct. Mr. New testified that “the Kenefiek-Hammond-Quigley Construction Company was a close corporation, more in the nature of a partnership between Kenefick, Hammond and Quigley, only it was the corporate name, and, when Hammond got sick so that he could not do his part of the work, Kenefick and Quigley took over Hammond’s stock.” His testimony shows that he represented Quigley and Kenefick in the transaction that involved the purchase of the stock for which the notes of Quigley, indorsed by Kenefick, were executed. He prepared the contract, and his testimony also shows that he represented the same parties in the meeting that was had at Kansas City, February 12, 1908, at which were present Walter Hammond and John.T. Harding, an attorney representing appellee, and Alexander New, an attorney representing Quigley and Kenefick. The appellant contends that the meeting of February 12, 1908, was held for the purpose of making a partial payment on the $37,000 notes, and of giving new notes for the balance, and the testimony of appellant himself thoroughly sustains the contention. But, on the other hand, the testimony of Walter Hammond, and of John T. Harding, and of New, sustains the contention of appellee that the meeting of February 12, 1908, was for the purpose of settling all suits between appellant and appellee. Concerning this alleged settlement, New testified as follows: “I do not think Mr. Quigley went into detail with me regarding the suits at Beaumont and Mena. I just knew that he had been sued at both of these towns. I learned it from Mr. Quigley. He gave me no details at all that I can recall at this time. I do not believe I remember how many conferences were held regarding the settlement of the $37,000 suit — along about February, 1908. There were several, I think. We were trying to make the best settlement and to get all the time we could, and it ended up by Hammond — ■ Walter A. Hammond — who seemed to be the spokesman for Mrs. Hammond, agreeing to take half in money and give time on the other half. I do not recall at this time how much time there was given, on the other half. It is possible there were just two conferences held. Quigley was present at all of them except, I think, there was one talk I had with Hammond in trying to get little better terms if I could, but at the final conferences he was there because he was the man that was to sign the notes and checks. Mr. Quigley signed the two notes. My recollection is that the settlement was made in the evening after supper at Mr. Harding’s office in the Scarritt building, and it was all agreed upon and I think Mr. Quigley signed the notes, and my best recollection is, although I would not be positive about it, but my best recollection is that Quigley also signed the checks, and either left them .with me to get Mr. Kenefick’s signature, or got Kenefick’s signature himself, and returned them to me to be delivered to Mr. Harding. I have never, in Mr. Quigley’s strictly personal ■ matters, been his attorney, but this matter was, in a sense, a company matter, and in the negotiations I assumed I was representing Mr. Quigley and Mr. Kenefick, and made the settlement on that theory, and Mr. Quigley signed the notes and signed the check. I could not undertake to recall the words used regarding the dismissal of any suits; we all talked back and forth, and my understanding was that all suits were to be dismissed and the costs were to be cut in half, each side paying one-half. I do not recall the exact words. I do not recall what Quigley said on the subject, any more than I do what the others said. We were all talking, and we were settling these lawsuits, settling everything but the costs, and we could not settle them because we did not know the amount, and Mr. Quigley said when we found the amount Mr. Hoffman would send a check for it, and he sent a company’s check which I turned over to Mr. Harding. I do recall that at the settlement in Mr. Harding’s office new notes were to be given for one-half of the amount, and that one-half of the amount was to be paid in cash, or its equivalent, checks; that one-half of the costs were to be paid by each side, and the suits at Independence, Mena and Beaumont were to be dismissed. There may have been other things said back and forth that I might recall if questions were put to me. I do not recall that Mr. Quigley, at that meeting, said anything about dismissing any suit. What I recall was said was that the suits were to be dismissed, that is the suits at Mena, Independence and Beaumont. The counterclaim was in no way referred to in this settlement that I can recollect. I can not recall the exact words that were used in this connection.” The testimony of Walter Hammond shows that at the conference of February 12, after the check for the half was received by him for the appellee and the notes for balance executed and delivered to him by New, representing Quigley and Kenefick, “New stated to Harding to dismiss the cases.” The testimony of Harding, the attorney representing appellee, corroborates the testimony of New. The testimony of appellant shows that at the conference of February 12,1908, in Kansas City, nothing was ever brought up about appellee’s indebtedness to him. He did not say then that he had any claim against her for the reason that he “did not want to open up any old sores at all.” Without going further into detail in setting out or commenting on the testimony, let it suffice to say that the court was warranted in the conclusion “that the acts and omissions of defendant misled the plaintiff and her counsel,” causing them to believe “that all matters between plaintiff and defendant were settled and closed.” The court was also thoroughly correct in the conclusion that the acts and omissions of appellant constituted a legal fraud in the procurement of the judgment against appellee, for which same should be vacated. The authority for vacating a judgment obtained by fraud is found in section 4431, Kirby’s Digest, subdiv. 4; Womack v. Womack, 73 Ark. 286; Parker v. Bowman, 83 Ark. 511; Wood v. Stewart, 81 Ark. 51; Boynton v. Ashabranner, 75 Ark. 425; James v. Gibson, 73 Ark. 444; Chambliss v. Reppy, 54 Ark. 539. To vacate a judgment for fraud practiced by the successful party in obtaining it, the party seeking such relief must make at least a prima facie showing of a valid defense to the action in which the judgment was obtained. Kirby’s Digest, § 4434; Simpson & Webb Furniture Co. v. Moore, 94 Ark. 347; Martin v. Gwynn, 90 Ark. 44; Broadway v. Sidway, 84 Ark. 527; Knights of Maccabees of the World v. Gordon, 83 Ark. 17; State v. Hill, 50 Ark. 458. In the seventh paragraph of the cross complaint the appellant alleged that all of the suits instituted by appellee against him were for the “malicious purpose” of injuring his credit. The judgment herein sought to be vacated was bottomed on the above paragraph, for it recites the following: “And the court, after hearing the evidence of the witnesses, finds that the complaint filed herein by Mary K. Hammond was without cause, and was maliciously done for the purpose of damaging and injuring the said R. M. Quigley, and that the said R. M. Quigley has sustained damages in the sum of fifty thousand dollars because of the filing of the complaint herein and the institution of this suit against, him.” Conceding, without deciding, that the seventh paragraph states a cause of action, it is only necessary to determine whether or not appellee shows a meritorious defense to the seventh paragraph. It could serve no useful purpose to discuss the facts in detail. The evidence shows that appellee brought her suit against appellant to recover on notes that represented a just debt, which appellant had failed to pay at maturity, and that her suits were brought, not to embarrass or injure appellant, but to collect a debt which he did not deny, and which he afterwards paid. His only alleged defense to appellee’s suit on the notes was that, according to a verbal understanding and agreement between him and the payee, the notes were not to be due and were not to be paid at the time specified therein, but were to be extended. This part of the answer stated no defense at all. It was clearly demurrable. No proof could have been made to sustain it, for such proof would have varied the terms of the written contract. The evidence shows conclusively that appellee did not bring suit on the notes “with the malicious intent and for the purpose of harrassing or injuring appellant,” but “solely for the purpose of getting service on” him “and collecting the notes,” as the court found. The court was likewise correct in finding, under the evidence, that there was no negligence on the part of appellant or her attorneys. There is no error in the record, and the judgment is affirmed.