Pratt v. Brewster

Stoddard, J.* The plaintiff in error, Pratt, and one Rooney were partners. An action was brought and judgment obtained against Pratt alone. In this writ of error he insists that the judgment against him is erroneous for the reason, as he alleges, that the cause of aetion is in substance and in form ex contractu, and, if in form in tort, yet that it is founded on contract, and that therefore his partner Rooney should have been joined as a co-defendant. [71] The case finds that Pratt and Rooney were partners in a law and collection business in the city of New York, that Pratt was and Rooney was not an attorney-at-law, and that the former had the general direction of the business of the firm and took special charge of matters in court, while Rooney looked after the collections. On March 6th, 1871, the firm received from Brewster & Co., the defendants in error, for collection, a note for the sum of $1,781.50, due September 9th, 1870, held by them against Charles P. May, of Montgomery, Alabama, with directions “to collect the same by suit or otherwise as might be necessary.” On' January 8'th, 1873, Pratt & Rooney received, through their correspondents, on account of this claim, the sum of $617.86, and on February 5th, 1873, the ftirther sum of $327.39. The firm of Pratt & Rooney was dissolved December 31st, 1873, and on November 27th, 1875, Pratt received on the same account the further sum of $203.33. Both before and after the last date Brewster & Co. made demand on Pratt for an accounting, and for the payment of the moneys received. The sums of money received January 8th and February 5th, 1873, were converted by Pratt & Rooney to their own use, with the knowledge and participation of Pratt, and the sum -received by him November 27th, 1875, was also by him converted to his own use. Nothing has ever been paid to Brewster & Co. Upon principle and authority it is clear that an agent converting the property of his principal to his own use is liable to respond for such wrongful act in an action framed in tort. It makes no difference in this particular that an action on the implied contract could be also maintained. Trover, before the existence of our recent Practice Act, was an appropriate remedy. Attorneys as well as other agents are subject to this rule, and if any distinction is to be made it certainly is not in the direction of exempting from a liability attaching to other agents, an agent who occupies the relation of peculiar trust and confidence reposed in an attorney. The money received by Pratt & Rooney and by Pratt [72] was the property of Brewster & Co. It was the clear and undisputed duty of Pratt to pay it over to them upon demand, and it is very generally held that as an attorney, he was bound, within a reasonable time after its receipt, to notify his clients of that fact, and failing in this duty he is liable in tort for such negligence. The rule as to the liability of attorneys is stated, with a full citation of authorities in Cotton v. Sharpstein, 14 Wis., 226. See also Weeks on Attorneys-at-law, p. 514, § 308. The complaint contains a statement of the material facts found by the court, and in one of the paragraphs it is charged that said sums were received by Pratt and by Pratt & Roonejr, “ acting as the attorney and agent of Brewster & Co.,” and were “fraudulently appropriated by Pratt, and never paid or accounted for, although a reasonable time for doing so has long since elapsed.” Here is a direct and definite statement that the money was appropriated by Pratt to his own use against the will of Brewster & Co., and the complaint contains a statement of every essential fact to charge him in tort. Reliance is placed by the plaintiff in error upon the fact that in one of the paragraphs of the complaint it is alleged that he and his firm “ agreed to account to the plaintiffs for all moneys collected, &c.” From this he argues that a contract is alleged in the complaint, and so the form of action is ex contractu. This conclusion does not follow; the language used is a meré statement of what the law .implies from the other facts stated in the complaint; that is, the obligation of the defendant in the suit to turn the money collected over to the plaintiffs; so that, when it is further alleged that notwithstanding that obligation the defendant appropriated the money to his own use, he did a tortious act, whereby a right of action in tort sprang into existence. Hecessarily, when an agent is properly charged with converting to his own use property of his principal, the facts show an obligation or contract on his part to return the property to its owney. The obligation is in one sense an element of the cause of action, but it does not constitute [73] the cause of action. The cause of action arises because of a wrongful act of the agent in reference to the property» It is of no consequence that this property is also the subject of a contract between the parties. Even if this action had been in form ex contractu, and not in tort, this writ of error, for pther reasons could not succeed. The case is free from difficulty and does not demand further discussion. There is no error in the judgment. In this opinion the other judges concurred. Footnotes [*] Judge Stoddabd of the Superior Court sat in the place of Judge Cabbenteb, who was disqualified hy relationship to one of the parties.