Gerard v. Gateau

Bailey, J. The point is raised that the circuit court, at the time the damages were assessed, had no jurisdiction to make the assessment, because, 1, the suit had been disposed of by a final decree before the suggestion of damages was filed; and, 2, because, by the appeal, the suit was removed to the Supreme Court, and the jurisdiction of the circuit court superseded, and there was no remanding order restoring jurisdiction to that court. It is not clearly shown when the suggestion of damages was first filed, as the original paper seems to have been lost, but enough appears to warrant the presumption that it was filed within the time limited in the order of the court. It doubtless would have been more strictly in accordance with the terms of the statute to file the suggestion before the final disposition of the case by the entry of a decree, and had the point been raised in the court below, we will not say that it might not have been the duty of the court to refuse to assess the damages. But permission to file the suggestion at a subsequent day of the same term having been reserved in the decree, and the complainant having raised no objection as to the time of filing it,- but having waived the irregularity, if it was one, by subsequently entering into stipulations, on one or more occasions, for the continuance of the proceeding and by finally appearing without objection and contesting the assessment of damages on the merits, we think it now too late to raise any question as to the time of filing the suggestion. It can scarcely be doubted that if the parties had, prior to the entry of the decree, stipulated to extend the time for filing the suggestion to some day in the term, subsequent to the decree, that a suggestion filed in pursuance of the stipulation would have entitled the defendant to an assessment of his damages. We are unable to perceive why the subsequent acts of the complainant in the course of the proceeding, as shown in this case, may not be held to have an effect equivalent to such stipulation. The fact that the suggestion was not heard and disposed of until a subsequent term, does not seem to be material. This appears to be the view taken in Wing v. Dodge, 80 Ill. 564, where the court, in discussing the proper practice in such cases, say: “ After the dissolution of the injunction the defendant may file his suggestions at any time before the decree is filed. The filing of the decree is the final disposition of the ease in the circuit court, and the complainant could not appeal until the cause had progressed to that stage, and suggestions might be filed up to the time when the decree is filed, and if need be the court should hear and dispose of them afterward.” Furthermore, if it be true that the appeal superseded the jurisdiction of the circuit court so as to require a remanding order before that court could proceed further in the assessment of damages—a question we do not feel called upon to decide—we are of the opinion that the voluntary appearance of the complainant in the circuit court, after the decision of the appeal, without waiting for or requiring the formality of a remanding order, and litigating the matter of the assessment of damages without objection, amounted to a waiver of a remanding order, and authorized the court to proceed to assess the damages. It appears from the record that $3,500 of the damages assessed accrued after the final disposition of the case in the circuit court, and during the pending of the appeal, and the allowance of these damages is assigned for error. The authority of a court of chancery to assess damages upon a dissolution of an injunction is purely statutory. The extent of the power, then, and the limitations, if any, under which it must be exercised, are to be ascertained from the statute itself. The language of the statute is as follows: “In all cases where an injunction is dissolved by any court of chancery in this State, the court, after dissolving such injunction, and before finally disposing of the suit, upon the party claiming damages by reason of such injunction suggesting, in -writing, the nature and amount thereof, shall hear evidence and assess such damages as the nature of the case may require and to equity appertain, to the party damnified by such injunction, and may award execution to collect the same.” The plain and manifest meaning of the statute is, that the suggestion of damages must be filed before the final disposition of the case, which is held to mean, before the entry of the final decree. Albright v. Smith, 68 Ill. 181; McWilliams v. Morgan, 70 Id. 551; Wing v. Dodge, supra. If filed at a subsequent term, it comes too late, and confers no authority on the court to assess damages. Albright v. Smith, supra. The institution of the proceeding, then, being limited in point of time to a period prior to the final decree, the damages recoverable are, as a necessary consequence, limited to such as may have then accrued. Like other proceedings for the recovery of damages, it can apply to such damages only as are recoverable at the date of its institution. It can not be commenced subsequent to the decree, and so can not apply to damages resulting from a subsequent revival of the injunction pending an appeal. Furthermore, it can not be said that damages sustained by reason of the injunction being continued in force by an appeal are the proximate result of the issuing or pendency of the injunction in the court from which the appeal is taken. A somewhat similar question arose in Mix v. Singleton, 86 Ill. 194. That was a suit upon a bond conditioned, among other things, for the payment of “ all damages caused by wrongfully suing out the injunction,” and it was held that damages sustained by reason of the injunction being kept in force by the appeal were not embraced within the condition of the bond. See also Rees v. Peltzer, 1 Bradwell, 315. The amended suggestion, then, so far as it imported into the case a claim for damages pending the appeal, gave the court no authority to assess such damages against the complainant, because, 1, the suggestion of those damages was filed at a term subsequent to the one at which the suit was finally disposed of; and, 2, because such damages, being subsequent to the final disposition of the suit, were not such damages as could be recovered in this proceeding. It appears that of the damages awarded the defendant $600 was “for loss of salary” during the time the bill was pending in the circuit court, and $2,700 was “for loss of salary” pending the appeal. Unless the defendant was entitled to receive a salary during the period of this litigation and was wrongfully deprived of it by the injunction, the award of damages on account of salary was erroneous. The rule is well settled that one partner can not charge the other partners or the firm for services rendered in the business of- the copartnership unless there is an express agreement to that effect. As there is an implied obligation upon every partner to exercise due diligence and skill and to devote his services and labor for the promotion of the common benefit of the concern, it follows that he must do it without any reward or compensation unless it be expressly stipulated for between the partners. Lewis v. Moffett, 11 Ill. 392; Roach v. Perry, 16 Id. 37; King v. Hamilton, Id. 190; Story on Part. §§ 182-185; Pars, on Part. 229, and authorities there cited. In this case the defendant expressly stipulated in the articles of copartnership to devote his entire time, skill and attention to the prosecution of the firm business, but there was no agreement for the payment to him of any compensation or salary therefor. The only stipulation upon which he relies in his claim for salary is one which provided that said partners should respectively, during the first five years of the copartnership, draw no more money out of their business for their own personal use than should be absolutely necessary for the support of their families, which should not exceed the sum of $100 per month for each, the residue of the profits to be applied to the business of the firm. This is in no sense an agreement for the payment of a compensation or salary to the defendant. The money was not to be drawn as compensation but as a division between the partners, fro tanto, of the partnership assets. The provision constituted a mere limitation upon the amount which the partners should respectively be at liberty to draw out of the partnership funds for their private use, or, in other words, a limitation for the period of five years upon their division of the profits. It follows that the allowance of damages for loss of salary was wholly unwarranted. We are of the opinion that the amount of damages awarded the defendant on account of solicitor and counsel fees, is unsupported by the evidence. The main scope and object of the bill was to obtain a dissolution of the copartnership and a distribution of the copartnership assets, and the injunction restraining the defendant during the litigation from interfering in the copartnership affairs was merely incidental. There is considerable evidence of services by solicitors and counsel while the case was "pending in the Supreme Court, directed specifically to getting rid of the injunction or to obtaining some modification of its terms,, but as we have already held that damages resulting from the injunction being continued in force by the appeal were not proper matters for consideration in the assessment of damages-in the circuit court, it will be unnecessary for us to consider the evidence on that subject. It appears, however, that immediately after the injunction was first awarded by the circuit court, the defendant retained a solicitor and counsel to appear and defend the bill, who, after investigating the case, prepared an answer, and also drew a number of affidavits to be used on a motion for a dissolution of the injunction, and the evidence tends to show that he afterward made and argued such motion, basing the same upon said answer and affidavits and that the motion was overruled. Before performing further services, said solicitor and counsel withdrew from the case,. having charged his client $150 for all the services he had rendered. There is no evidence that any subsequent motion to dissolve the injunction was made while the case was pending in the circuit court, or any further services rendered having a specific reference to the injunction. The case was heard on pleadings and proofs, and a final decree rendered dismissing the bill for want of equity, which decree operated as a dissolution of the injunction. The damages awarded on account of solicitor and counsel fees for services rendered in the circuit court, were $500. The rule undoubtedly is that costs and expenses, reasonable in amount, incurred for the single object of obtaining a discharge of the injunction, are allowable as part of the damages sustained by reason of the injunction. But where counsel fees and expenses are incurred in defeating the action, and the dissolution of the injunction is only incidental to that result, such fees and expenses are not allowable. 2 Sutherland on Dam. 65, 68. This rule has been repeatedly laid down and enforced in this State. Thus in Jevne v. Osgood, 57 Ill. 340, it is said: “The design of the statute is not that the defendant shall, where the injunction is dissolved, recover his attorney’s fees for all that has been or may be done in the case. To give the statute such an unreasonable construction, would render it an instrument of great oppression. It was intended to reimburse the defendant for money which he paid, or for which he has become liable on the motion to dissolve." Again, in Elder v. Sabin, 66 Ill. 126, it is said: “The statute only allows the assessment of damages sustained by reason of improperly suing out the injunction, and the damages must be confined alone to that ground. The charge of lawyer’s fees could only extend'ft? the motion to dissolve the injunction.” To same effect are Blair v. Reading, 99 Ill. 600; Darst v. Gale, 83 Id. 136; Wilson v. Haecker, 85 Id. 349; Noble v. Arnold, 23 Ohio St. 264; Langworthy v. McKelvey, 25 Iowa, 48; Hovey v. Rubber-tip Pencil Co. 50 N. Y. 335; Disbrow v. Garcia, 52 Id. 654. So much of the $150 charged by the counsel who prepared, made and argued the motion to dissolve the injunction as properly appertained to that motion, was doubtless allowable as damages, but beyond that we find no evidence warranting any allowance for counsel fees. So far as appears, all other services were rendered in endeavoring to defeat the suit, and would have been just as necessary if there had been no injunction. The defendant has assigned for error, the refusal of the court to award him damages under the remaining items of his suggestion. The most important of these items is, for defendant’s share of the profits of the firm business, which would have accrued if the injunction had not been issued, and the defendant had continued to have charge of the business. Damages to the defendant’s business and a consequent loss of profits, if any such resulted from the injunction, are, we think, allowable as damages “by reason of the injunction.” But we are not satisfied that any such damages have been shoxvn. The effect of the injunction was to withdraxv the defendant from the management of the firm business, but the evidence is very conflicting as to whether that produced a depressing or salutary effect upon the business. There is very considerable evidence tending to show that the defendant was lacking in the qualifications necessary for the successful management of the copartnership affairs, and that the manager who was placed in charge of the business after the injunction was issued, was, to say the least, quite as competent to manage it successfully and profitably as the defendant. Much reliance is placed by the defendant, so far as this question is concerned, upon the evidence tending to show that during the time he managed the business it yielded large profits, but that afterward the profits were greatly diminished. This state of things, hoxvever, seems to be explained by evidence tending to shoxv that, at about the time the injunction was issued, the general condition of the market for the class of products manufactured by the defendant’s firm had so changed and become so depressed as to make it difficult, by any management, to realize any profits from the business, and that as a result most of the other firms then engaged in the same business in Chicago became insolvent. Tiie court below seems to have reached the conclusion, in view of all the evidence, that no damages under this specification were proved, and we are inclined to the opinion that such conclusion was warranted by the evidence. The only remaining item of damages claimed, is for interest on the defendant’s capital invested in the business. We see no foundation for this claim. There was no agreement between the copartners for the payment of interest to the defendant on his capital, the only agreement as to interest being to pay interest to the complainant on that portion of his contribution to the firm, which was in excess of the amount contributed by the defendant. But even if there had been such agreement, there is no reason for holding that such interest was lost by means of the injunction. The defendant’s claim for interest would remain a valid claim against the firm tobe allowed the defendant on the final accounting between the copartners at the dissolution of «the firm. The cross-errors will be overruled and the errors assigned by the complainant sustained to the extent above indicated, and the decree will therefore be reversed and the cause remanded for further proceedings. Decree reversed.