Case Name: Chapman v. Lee
Court: Supreme Court of Ohio
Jurisdiction: Ohio
Decision Date: 1887-11-01
Citations: 45 Ohio St. 356
Docket Number: 
Parties: Chapman v. Lee.
Judges: 
Reporter: Ohio State Reports, New Service
Volume: 45
Pages: 356–368

Head Matter:
Chapman v. Lee.
Appeal — Bight to trial by jury — Accounting in equity — Discovery.
1. Upon the trial of an action against several defendants, where the plaintiffs in their petition charge upon the defendants a conspiracy to cheat . and defraud the plaintiffs, and with thereby procuring and appropriating to their own use a single sum of money which rightfully belongs to the plaintiffs, and which they are entitled to recover, and for which they seek a joint judgment against the defendants, and the answer admits the receipt of a stated sum of money, and is otherwise, in effect, a general denial, either party is entitled to demand a jury, notwithstanding the plaintiffs pray a full discovery, and for an account of the full amount due to them, and to have an equitable lien declared and enforced.
2. In such case the remedy of accounting in equity, is not necessary to full and adequate relief to the plaintiffs.
3. Adequate means of obtaining discovery from parties to actions at lair being afforded by our statute, suits for discovery, as prosecuted in equity, before the adoption of the code, are practically obsolete in this state.
(Decided November 1, 1887.)
Error to the Circuit Court of Lucas County.
Suit was brought in the court of common pleas of Lucas county by the defendants in error against the plaintiffs in error, and Albert J. Miller and The Lake Shore & Michigan Southern Railway Company, by the filing of a petition of which the following is the substance :
In the year 1879, the plaintiffs, who were partners in the practice of law, entered into a contract in writing with the defendant Albert J. Miller, whereby the plaintiffs were to prosecute an action for him against the railway company for damages to his property by fire, and, for their services, in addition to being reimbursed for any money outlay necessarily made, were to receive four-tenths of all moneys that might be realized from the company, whether by judgment and execution or settlement and compromise, and were to have a lien on any money so realized to the extent of four-tenths, and if nothing was realized they should receive nothing for services, but should be reimbursed for moneys expended. Chapman and Tracy were at the time creditors of Miller. They' had notice of the terms of the contract, and, in writing, assented to it. The plaintiffs prosecuted the action with due diligence, and procured a judgment against the company for $12,811, and costs. This judgment was reversed by the district court, and the cause remanded to the court of common pleas for a new trial. The plaintiffs were endeavoring to bring the case to trial and final judgment at the May term, 1881, when during said May term, Miller, Chapman, Tracy and said railroad company, all well knowing all of the rights of plaintiffs herein under said contract, negotiated and conspired with each other to affect a settlement of said action without further proceedings in court, and to conduct secretly as to said Lee & Brown, said nego tiations, and to so fix upon the terms of, and make payment under said settlement, as to deceive said Lee & Brown as to the terms of said settlement and as to the amount they would be entitled to receive out of the same under their said contract for said professional services;
“ That in furtherance of said plan and purpose, it was devised and agreed to between the defendants herein, that their real negotiations and agreements in respect to said settlement, and the carrying out of same, should be kept from the knowledge of the plaintiffs herein, and that the defendants herein should hold out and represent to the plaintiffs that such settlement was in fact agreed upon at and for the sum of five thous- and dollars and no more, and these defendants in pursuance of said plan and purpose, did get up an agreement in writing and cause the same to be signed by said Miller and said railroad company to the effect that said cause was settled between the parties thereto, at and for the sum of five thousand dollars, to be paid by said railroad company; and on the 6th day of June, A. D. 1881, they caused said written agreement to be produced to said court, and to have said court make an order declaring said cause settled at and for the sum of five thousand dollars, although the plaintiffs herein then and there objected to the making of said order, and to said alleged settlement.
“ That to enable the defendants herein to deceive the plaintiffs herein as to the amount at which said settlement was in fact made, and to cheat and defraud plaintiffs out of a part of the four-tenths of the amount paid and to be paid, the defendants herein got up a pretense, which they fully carried out, that the defendant Chapman, who was interested, in conjunction with the defendant Tracy, as the bondsman of said Miller in obtaining, of the proceeds of said proposed settlement, the sum of about three thousand dollars to meet their said liability, should be pretendedly employed by, and act as, the agent of said railroad company in attempting to effect, and effecting, a settlement of said action, and that whatever was in fact paid by said railroad company, or was or might be agreed so to be so paid, over and above the sum1 of five thousand dollars," should be pretendedly paid by said railroad company to said Chapman or some other for him as and for his compensation for his pretended service in and about effecting such settlement.
“ That said aforesaid pretense and scheme were, in fact, carried out by defendants, and said railroad company in fact for and in consideration of the settlement of said action, did pay, not only the sum of five thousand dollars, but also a further large sum, but in what precise sum, the plaintiffs do not know, for the defendants have each and all refused to inform plaintiffs of the true amount thereof, which amount -plaintiffs are by others informed and believe is not less than the sum of four thousand dollars.
“That said payment so made by said railroad company, was, in fact, so made for the sole purpose of aiding said Miller and other defendants in cheating plaintiffs out of the full four-tenths of said settlement money, and of getting the amount of said settlement-money reduced to a lower amount than it otherwise could have done, and with full knowledge on the part of said railroad company, that said money so paid to said Chapman or said Tracy, or some other for said Chapman, was so paid to and for the use and benefit of said Miller, as in fact it was:
“ That at the time said contract was entered into by and between plaintiffs herein and said Miller, and from thence until the present time, the said Miller has been, and now is, insolvent, all of which was well known to each and all of the other defendants herein, at and before the time of making and carrying out of said settlement:
“ That by reason of the premises the plaintiffs had a right to have from said railroad company, and a lien upon, four-tenths of all moneys, directly or indirectly páid by said railroad company for or on account of the settlement of said action, and that said lien so attached to and upon said moneys in the hands of said railroad company and followed and now attaches to the same in the hands of whomsoever the same may have passed, with the knowledge of plaintiffs’ said rights; but plaintiffs have received of the same only the sum of two thousand dollars:
“ That plaintiffs are entitled to have a full discovery from the defendants of each and all the facts touching said settlement and the amount and payment of the settlement money, in whatever form the same may have been made, whether under the guise of compensation to said Chapman for services or otherwise. And they are also entitled to have an account of the full amount due to them under said contract with said Miller, from said Miller, said railroad company, said Chapman, and said Tracy, and to have the judgment and decree of this court that defendants pay the same to plaintiffs:
“ The plaintiffs further say that the defendant — The Lake Shore & Michigan Southern Railway Company — is a railroad corporation under the laws of Ohio, and its line of railroad runs and is operated through Lucas county, Ohio.
“ Whereupon plaintiffs pray that said Charles F. Chapman, J. R. Tracy, and the Lake Shore & Michigan Southern Railway company may be made parties defendant hereto; that they may be served with process; that they may make full answer to each of the interrogatories hereto annexed, and on final hearing hereof, plaintiffs may have their lien declared and enforced upon and against the full four-tenths of any and all moneys paid or agreed to be paid by said railway company, directly or indirectly, for or on account of the settlement of said action, and that plaintiffs may have the judgment and decree of the court accordingly, and for other and full relief.” Chapman answered, alleging, among other things, that the railway company stated to him that they desired to settle and stop litigation, but were unable to settle with Miller, and offered to pay him (Chapman) $2,500 as stated compensation for his services if he would procure a settlement at $5,000; that he undertook the service, spent much time, and did settle the case for that sum and received of the company the $2,500 agreed for such service; that he had been sued as surety for Miller, and had from Miller an assignment of an interest in the claim against the railway company; that this was the first assignment, and that other creditors had like assignments executed later, and that without great abatement of the claims of other creditors no settlement could be had, etc., etc., and denying all allegations inconsistent with the answer.
Tracy answered alleging that he received for Chapman checks from the railway company to the order of Chapman, as an accommodation to Chapman, and turned the same over to him, and had no other connection with the matter.
Miller also answered as did the railway company.
Replies to these several answers were filed by plaintiffs. At the trial neither party having demanded a jury the case was tried and submitted to the court. The court found in favor of the railway company as against the plaintiffs, and dismissed the company from the case. It found in favor of the plaintiffs as against Miller, Chapman and Tracy, and rendered a judgment against them for $1094 and costs." The plaintiffs gave notice and bond for appeal as to the judgment in favor of the railway company, and Chapman and Tracy gave notice and bond for appeal as to the judgment against them. In the circuit court, on motion of the railway company, the plaintiffs’ appeal was dismissed, and on motion of the plaintiffs the appeal of Chapman and Tracy was dismissed, on the ground that in law those defendants had no right to appeal from the judgment against them. To reverse this order of dismissal of the appeal of Chapman and Tracy this proceeding in error is prosecuted.
Bissell & Gorrill, for plaintiffs in error.
The frame of the petition below was as completely a petition in equity as modern equity practice could require.
The interest of plaintiffs below in the claim in suit was equitable and not legal. Stanbery v. Smythe, 13 Ohio St. 500; Christmas v. Griswold, 8 Ohio St. 558; Horst v. Dague, 34 Ohio St. 371; Story’s Eq. Jur. sec. 1045; Olds v. Tucker, 35 Ohio St. 581; Reed v. Reed, 25 Ohio St. 422.
The plaintiffs below implored the aid of the equitable power of the court; (1) because they were ignorant of the true state of facts, and asked a discovery, and (2) because they had no legal title to the fund, they asked the court to find and en force the lien upon which the contract was supposed to vest them with.
They did not ask a money judgment for any particular sum, but asked the court to take an account. What would they have done with such a case on default? They did not indorse their petition, and the summons did not state, that the action was for a specific sum of money, and for money only, as required in actions at law.
In Hall v. Eaton, 25 Vt. 458, the court held, that in case of conspiracy to prevent a creditor from getting pay of his claim from a debtor, the creditor should either attach the goods or go into a court of equity and charge the confederate as a trustee. This was the object of the action below.
The right of action against Miller was founded upon the contract. The right of action against the other defendants might be joint or several, or might exist against one alone, or more than one, depending upon the application of equitable rules to the testimony which should be received upon the trial. How was a jury to determine such liability ? McCrory v. Parks, 18 Ohio St. 1-7.
“ Equity has exclusive jurisdiction over an assignment of a specific fund.” 1 Pom. Eq. Jur. sec. 169; Weakly v. Hall, 13 Ohio, 174.
J. O. Lee and J. M. Brown, in person.
It is plain that the test is whether the right to demand a jury in the case did or did not exist.
The mere presence of allegation and prayer in-the pleadings setting up a right to, or demanding, equitable relief, may not be conclusive upon the question as to whether or not a jury may be demanded prima facie. If there is a prayer for a judgment for money only, as ultimate relief, either party has the right to demand a jury. Ladd v. James, 10 Ohio St. 437; Sheeful v. Murty, 30 Ohio St. 50; Brundridge v. Goodlove, 30 Ohio St. 374.

Opinion:
Spear, J.
This court is called upon to determine but one question: Did the circuit court err in dismissing the appeal of Chapman and Tracy ? If the parties had the right, in the court of common pleas, to demand a jury, then the case was not appealable; if they had no such right, then the case was appealable, and the appeal was improperly dismissed.
A jury trial may be demanded by either party of "issues of fact arising in actions for the recovery of money only." (Section 5130, Revised Statutes.) If the pleadings in this action made a case for the recovery of money, and one in which a joint judgment might be rendered against the defendants, a jury could, of right, have been demanded. An examination of the pleadings will determine this question. What was the primary object sought? If it was a judgment for money against all the defendants, and the allegations of the answers did not change the character of the case attempted to be made, the mere fact that the petition contains allegations which seem to invoke some of the equity powers of the court, will not necessarily change the character of the action. The purpose of the pleader, even, does not control, but we must ascertain the scope and purpose of the proceeding. Under our rules of pleading the petition must contain a statement of the facts constituting the cause of action, and a demand of the relief to which the party supposes himself entitled. When we have ascertained the legal effect of the facts pleaded, the scope of the action is determined and the question disposed of. The pleader may have inserted allegations which are immaterial and unimportant. He may have asked for relief, to which, though he supposed himself entitled, he was not entitled. These errors, if such they are, in the absence of a motion to make definite, or to strike out, would not alter the legal effect of his pleading. Ladd v. James, 10 Ohio St. 437; Brundridge v. Goodlove, 30 Ohio St. 374.
A careful examination of the petition satisfies us that, giving to it the liberal construction which our practice requires, the gist of the action attempted to be appealed was a charge of fraudulent combination between the defendants, whereby plaintiffs were deceived as to the real terms of settlement of the pending case, and money, which belonged to plaintiffs, was wrongfully appropriated to the use of Miller for the bene fit of himself, Chapman and Tracy. The plaintiffs had an equitable lien, by virtue of their contract with Miller, upon all moneys paid by the company to the extent of four-tenths, but the action idid not primarily seek to trace the fund as such and enforce a lien on that, or hold Chapman and Tracy as trustees, but rather to hold them all liable for money had and received by them to the use of plaintiffs. In other words, the claim of plaintiffs in substance was that the defendants Miller, Chapman and Tracy were wrongdoers; that they had, by a fraudulent combination, procured money which in fact, as to four-tenths of it, was the money of plaintiffs, and hence the defendants were jointly liable to plaintiffs for the amount. The receipt of money by Chapman from the source claimed, and the possession of checks, by Tracy from the same source, was admitted, and neither answer made a case different in kind from that made by the petition. Hence the simple question was whether or not this claim of the plaintiffs was true. If it was, the moment that the money in settlement of the case against the railway company passed into the hands of the defendants, four-tenths of it became the property of the plaintiffs, known by the recipients to be such, and any appropriation of it by Chapman and Tracy, or by Miller with their knowledge for their benefit, was a wrongful use of the plaintiffs' part of the money, for which those defendants became liable to plaintiffs, and the remedy was a straight judgment against all of them.
This case is dissimilar in principle to Hall v. Eaton, 25 Vt. 458, cited by counsel for plaintiffs in error. There the defendant combined with the plaintiff's debtor to conceal the latter's property, and prevent the plaintiff, who was a general creditor and had no lien, from reaching it. The acts complained of were alike injurious to all the creditors of the debtor; the plaintiff had not been injured in any personal, individual right. The court held that plaintiff might have gone into a court of equity, or have charged defendant as trustee, but that he could not maintain an action on the case, and remarked that if the plaintiff had acquired a right to have the application of the property made in payment of his debt, to the exclusion of other creditors, a different question would arise, and intimated that in such case an action on the case could be sustained. The equitable lien on the money given plaintiffs in the case at bar by the contract, gave them the right to have four-tenths of it applied in payment of their services, to the exclusion of all other creditors. Our case more resembles that of Adams v. Paige, 7 Pick. 542, where a third person fraudulently aided a debtor to conceal his property and cause it to be sold and proceeds applied on a fictitious judgment, and a creditor having obtained a subsequent lien on the same property, which he could not enforce because of prior attachments and of the insolvency of the debtor, it was held that action on the case would lie.
Neither the allegation as to the right of plaintiffs to a lien on the money itself, nor to have full discovery, from the defendants of each and all the facts touching the settlement, and the payment of the settlement money, nor the claim that they are entitled to have an account of the full amount due to them under the contract, can materially change the case. As to the first, if it could avail the plaintiffs at any time, it could not do so unless they first showed facts which would warrant a money judgment; the second Avas an entirely superfluous allegation save as to the ordinary mode of inquiry by interrogatories, and the allegations of fact did not make a case for an accounting in equity, nor were there contractual relations botAveen plaintiffs and any of the defendants save Miller, and it Avas the other defendants against whom the real relief Avas sought, Miller being insolvent. Suits for diseoATcry Avere, in equity practice, auxiliary proceedings, brought not to obtain any equitable remedy, nor to establish any equitable right, but to aid in maintaining a legal right, and in prosecuting actions pending, or to be brought, in a court of Iuav. If a party could not succeed Avithout the aid of facts Avitliin the personal knoAvlcge of his adversary, he might file his bill, setting forth all the facts Avithin his knoAvledge, and adding interrogatories which the other party Avas required to answer fully under- oath. No relief beyond the answer desired need be asked, and no decree made, and as soon as the ansAver Avas complete the function of the equity court ordinarily was ended, but the answer so far as responsive, could be used by either party in the trial at law. yie will not be understood as meaning that it was not common for a court of equity, having taken cognizance of a case for one purpose, to retain it for all purposes, and award complete relief though the final remedy was of the kind which might be conferred by a court of law. Such result often followed where discovery was sought as an incident to equitable relief, covering the whole controversy. But where a court of law had ample power to award full relief, a court of equity ordinarly refused to take cognizance of the case, and there clearly is more conclusive reason for such refusal, in a case like the one at bar, under our present practice. All the aid which a suit for recovery would give is now given by our code in the case at law itself. The party may attach to his pleading interrogatories which, so far as pertinent, the other party is bound to answer, and those answers may be used by either party as evidence. He may also take the deposition of the opposite party, or put him on the stand as a witness at the trial. The doctrine and rules concerning the subject-matter of discovery established by courts of equity, are believed to be still in force and to control the same matters in the new procedure, but the bill of discovery, as a separate action, is practically obsolete in this state. And in a case like the present the matter of accounting is but another name for a discovery. It is not a case of mutual accounts, nor where there are circumstances of great complication, nor of a fiduciary relation existing, such as that of guardian, administrator, or director of a corporation, where a duty rests to render an account, nor is it a case of partnership. The single fact that an accounting would disclose, is: what was the exact amount paid by the railway company in settlement of the pending suit? and ample means, in the mode hereinbefore indicated, were at hand to ascertain that fact. Where an adequate remedy is given at law, resort to equity is not necessary,- and, as a general rule, cannot be had. Says Pomeroy in his work on Equity Jurisprudence, section 178: "Even when the cause of action, based upon a legal right, does involve or pre sent, or is connected with, some particular feature or incident of the same kind as those over which the concurrent jurisdiction ordinarily extends, such as fraud, accounting, and the like, still, if the legal remedy by action and pecuniary judgment for debt or damages would be complete, sufficient and certain— that is, would do full justice to the litigant parties — in the particular case, the concurrent jurisdiction of equity does not extend to such case. For example, whenever an action at law will furnish an adequate remedy, equity does not assume jurisdiction because an accounting is demanded or needed; nor because the case involves or arises from fraud; nor because a contribution is sought from persons jointly indebted; nor even to recover money held in trust, where an action for money had and received will lie." See, also, sections 82, 83, 142, 193, 194, 1420 and. 1421.
It is true that the prayer of the petition is involved and indefinite, but it can hardly be said that it does not pray a money judgment, though it does not ask for any particular sum of money. It does ask for judgment for four-tenths of any and all moneys paid on account of the. settlement of the case. But the character of the action is not wholly, or mainly, determined by the prayer. Though the pleader be mistaken as to the relief he may be entitled to, if he prove the allegations of his petition, such mistake would not deprive the court of the power or relieve it of the duty to grant such relief as the case made by the pleadings and evidence warrants. Nor is it of consequence that a judgment by default might not have been proper upon the petition. The issues were fully made by petition, answers and replies, and the case was tried upon evidence. The trial court rendered a money judgment against the defendants, which was the relief the plaintiffs were entitled to if their petition was true. Nor can the belief of the plaintiffs at the time as to their right to a jury affect the merits of the case.
We have examined all the cases cited by counsel for plaintiffs in error, but are not impressed that they support their contention.
From this view of the character of the case made by the pleadings, the conclusion follows that either party had a right to demand a jury at the trial, and the ease was, therefore, not appealable.
Judgment affirmed.