Morton v. Urquhart

LEWIS, J. 1. The plaintiff brought this action against the defendant TJrquhart for'the purpose of procuring an offset of mutual judgments. [394] Defendant’s attorney, Shearer, was made a party defendant on the trial, claiming to have taken an assignment from defendant of his judgment against plaintiff prior to the commencement of this action. The trial below resulted in an order for judgment for Shearer. Plaintiff appeals from an order denying a new trial. The here conceded facts are as follows: In May, 1899, defendant began an action against plaintiff in the municipal court of Minneapolis, which finally terminated in an order for judgment of date ■June 23,1899, and in a judgment in favor of defendant and against plaintiff in the sum of $117.23, which judgment was entered in said court on September 5,1899; that the attorney for defendant in that action was James D. Shearer, the intervenor in the case before us; that at the time Shearer was employed in the action it was agreed between him and the defendant that the attorney should have a lien upon any- judgment that might be obtained for his reasonable attorney’s fees in that action, and for any disbursements which he should make therein; that on August 30, 1899, defendant made an oral assignment of his recovery in the action, and of the judgment to be entered therein, to the attorney, Shearer; that on September 4, 1899, defendant and Shearer agreed that the attorney’s fees in that action should be $101, and that his disbursements should be allowed at f 4.46, and that those amounts were just and reasonable, and that no part thereof has been paid; that on September 5, 1899, an assignment in writing was made by defendant to Shearer of all defendant’s interests in the judgment that day rendered in that action, which assignment was filed in the office of the clerk of the municipal court on September 18, 1899. It is further conceded that on July 1, 1$99, the plaintiff purchased a certain judgment, rendered in a justice court in Minneapolis, for the sum of $86.40, in favor of one Grimes and against defendant, on October 24, 1889, which judgment was assigned by Grimes to plaintiff of date July 1, 1899, and the assignment filed in the justice court on July 3, 1899. The summons in the present action was served upon defendant Urquhart on August 30, 1899, and at that time he was insolvent. In the original complaint the judgment against plaintiff was alleged to have been rendered on August 29, 1899. In the amended [395] complaint, which was served on September 15, 1899, this date is alleged to be September 5. It is conceded that plaintiff had no notice of defendant Shearer’s claim of lien for attorney’s fees, and no notice of any of the agreements as to fees between defendant and his attorney, and of the assignments of the judgments by defendant to Shearer, except the - constructive notice of the assignment filed September 18, 1899. It is not necessary to consider whether the- attorney’s lien was merged in the assignment. We assume, under the findings, that there was an agreement for compensation, and that the lien became vested September 5, 1899, when the judgment was entered against plaintiff, and it is immaterial whether this lien was merged in the assignment. Assuming that the lien still survived after the assignment, yet plaintiff had no notice of any claim of the attorney until the assignment was filed, September 18, 1899. G-. S. 1894, § 6194, provides that the attorney shall have a lien for his compensation upon a judgment from the time of giving notice to the party against whom the judgment is obtained. Defendant insists that this statute was enacted purely for the benefit of the attorney, and to prevent the judgment debtor from paying the judgment creditor and leaving the attorney out; that the lien, by force of the statute confirming it, is absolute; and, in the absence of the section referred to requiring notice, the judgment debtor would stand in the same position as creditors of the judgment creditor. We are not called upon to decide what would be the respective rights of the judgment debtor and the holder of an attorney’s lien against the judgment, if the statute were not in force. But it is in force, and it provides that, so far as the judgment debtor is concerned, the attorney must act. He must give notice of his rights. Granted that the object of the statute is to protect the attorney, yet that protection does not operate of itself. ' And if it is to prevent the judgment debtor from paying the judgment creditor, leaving the attorney out, this implies that, without notice of the lien, he may pay the judgment creditor; and, if he may pay him in money or goods, he may settle with him in any other manner; and so it follows, upon principle, that he may enforce a settlement by offsetting one judgment against the other. Again, it has been held that the equitable [396] right of set-off between parties to the action is superior to the claims of attorneys, without regard to the statute. An attorney can have no greater right against the judgment debtor than his client. People v. New York, 13 Wend. 650; Crocker v. Claughly, 2 Duel, 684. Order reversed.