Gray v. Emmons

Manning J.: The objection at the hearing, that the bill is not so framed that relief can be given on the relation of the parties, we think is not well taken. It appears from the bill the bond Avas not only given Avhile the relation of attorney and client existed, but with reference to business then in the hands of Emmons & Van Dyke as attorneys for complainants, who executed the bond after it had been drawn up and sent to them for that purpose by defendants, relying upon and reposing confidence in them; and relief is asked on the ground that defendants have brought action on the bond, to indemnify themselves against the consequences of an act of theirs, done Avithout authority from, and not in the performance of their duty to complainants, when the bond was given for a different purpose. Such is kthe ground-work or substratum of the bill, and the case is one proper for relief, if sustained by the proofs. It is the policy of the law to scrutinize gifts, conveyances, and securities, given by a client to his attorney pending the relation, more especially when they are connected Avitli the subject matter of litigation; as then the necessities of the client, and the confidence reposed, place the client most in the poAver of his attorney. The relation, and the confidence it implies, Avhich confidence is absolutely necessary, in some cases, to promote the prosecution or defense of a suit, are frequently not so much matter of choice Avith the client, as of necessity. Hence the reason and justice of the rule of law, that will not permit them to be turned to the profit of the attorney, at the expense of the client. It was the duty of defendants, after a sufficient quantity of the mortgaged property was sold to satisfy complainant’s claim, to have returned the rest of it to Dowe. This they did not do, and the consequence was, Dowe recovered [549] a judgment against them for its value, in the trover suit. Had they returned it to Dowe, they would not probably have been sued; or, if he had sued them, they would have had a good defense, as the final determination of the trover suit abundantly shows. They deny authorizing Wall, the auctioneer, to sell this part of the property. But his testimony is against them on that point. He says they did. They also insist they had a right to sell the whole of the. property, under the assignment from Dowe to complainants, and, after paying complainants, to return what was left of the proceeds to Dowe. Unfortunately for them the law was held to be against them on this point in their suit with Dowe. —JSmmons v. Dowe-, 2 Wis. 822. But it may be said, and we admit the force of the objection if the case before us is one proper for its application, that an attorney is not to be held responsible to his client for his opinion on a point of law. This is generally true, where the law is doubtful, and the attorney acts in good faith, although it may afterwards turn out that he was in an error. But we do not think the principle applicable to the present case. There is no evidence before us that, among good practitioners at the bar in Wisconsin, there was a reasonable doubt in regard to the law, previous to the decision against them in the trover suit. And even if there Was, defendants do not appear to have acted under a misapprehension as to what the law was, in ordering the goods to be sold. In the letter to complainants of September 25th, 1851, they say “to-morrow we shall have had delivery from the marshal” (that is, in the replevin suit) “and we shall then immediately advertise and sell sufficient of the stock to pay the amount secured by the mortgage, thirty-nine hundred dollars.’’ Here is a clear recognition of the rights of complainants, under the assignment from Dowe, to have so much of the mortgaged property sold as would satisfy their demand; [550] and no intimation whatever of selling the whole of the property, and paying the excess of the proceeds to Dowe, after paying complainants. From the evidence it is highly probable defendants were misled by Waldo, who appears to have held himself out to them as the agent of Dowe, into giving Wall instructions to sell the remaining property (for it was not all sold at one time) after the sale made to pay complainants. This, however, lays complainants under no equity to indemnify them against the Dowe judgment. They had but one duty to perform after the first sale; and that was to return the residue of the property to Dowe. They were misled, it is true, by Waldo, into doing as they did; but complainants are in no way accountable for Waldo’s conduct. Nor are they in equity and good conscience under obligation to relieve defendants by taking the burden from their shoulders on to their own. In justice to all parties, in such circumstances, we think the misfortune should rest where it has fallen. It is said the bond was given with a knowledge of all the facts of the case. We do not think this is sustained by the evidence. It was given long after the property had been sold, of which fact complainants had been advised by letter. But they had also been advised by defendants that Dowe was proceeding for all of the goods, and not for those only that had been sold after their demand was satisfied. Their object in giving the bond was to receive the balance of their claim, amounting to some eleven hundred dollars, Avhich defendants had in their hands, and which they claimed a right to retain by way of indemnity against the Dowe suit. And the bill states the bond was given to indemnify defendants only against what Dowe might recover against them for the goods sold to pay complainants; and witnesses have been examined to prove this part of the bill. We shall not, however, go further into this part of the case, as it is unnecessary. [551] Complainants’ right to relief is in no way "affected by their employing counsel to attend to the suit on the writ of error in the supreme court, nor by what they did to compromise it. There is no evidence they, at that time, knew what their rights were. They undoubtedly supposed themselves bound by their bond. > Besides, the bond was without any consideration whatever, other than the supposed liability of defendants to Dowe for the goods sold to pay complainants’ demand. The decree below must be reversed, and a decree be entered in accordance with the prayer of the bill. Martin Ch. J., and Christiancy J. concurred. Campbell J". did not sit, being a nominal party to the record.