Court Opinion

ID: 3607972
Source: CourtListenerOpinion
Date Created: 2016-07-05 23:52:56.470427+00
Date Added: 2024-06-11T14:07:29.830557
License: Public Domain

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A judgment in favor of the plaintiff, entered upon the report of a referee, was reversed by the General Term. We must assume that the reversal was for some error of law, since the order does not certify it to have been founded upon error of fact. On the appeal to this court, the respondent is entitled to sustain the reversal by showing any error of law which is fatal to the judgment, whether made the reason of the action of the General Term, or wholly unnoticed by that tribunal. The respondent, however, labors under grave difficulties of a technical character, which are pressed upon our attention by his adversary.
No exception whatever was taken upon the trial, and that which was taken to the report of the referee is a general exception to all his findings, and each and every of them, which we have many times held is insufficient to raise any specific question, and practically of no avail. (Newell v. Doty, 33 N.Y. 83;Wheeler v. Billings, 38 id. 263.) There remain only the exceptions taken to the findings and refusals to find made upon the settlement of the case; and to these the further objection is interposed that they came too late and are, therefore, unavailable. (Code, § 1023.) So far as the case discloses, that question is raised on this appeal for the first time. We find the exceptions in the case, and without apparent objection, until the argument here is reached. The plaintiff did not object before the referee that he had no authority to pass upon the requests, nor make a motion to strike them from the case as improperly there. He permitted them to remain unchanged, and withholding the objection until the final argument before us. We think he must *Page 558 
be deemed to have waived the benefit of the rule established by the Code, and lost the right to the objection by his concurrence in the practice adopted. Upon these latter exceptions, therefore, alone can be based any legal error which will justify the reversal.
We may assume, without so deciding, that the forfeiture of the property of Wellington  Kidder by the action of the government, and the confession of its propriety and right contained in their petition to the secretary of the treasury, left still in the original owners a contingent right to so much of the proceeds of the property sold as the government should see fit to return, and that such right passed to the plaintiff by the general assignment of Kidder  Wellington to him. The question was very thoroughly and ably argued, and would not be free from difficulty if it was necessarily involved in our conclusion. We think it is not, and, therefore, assume for the purposes of the discussion the ground taken by the appellant. We assume, also, the further contention of the appellant, and which is in accordance with the findings of the referee, that the action of the defendant and his deceased partner was not that of mere agents, but of a professional character, and founded upon the relation of attorney and client. It is determined by the referee that the proceedings for a remission, commenced in the name of the assignors and so continued to the end, were, nevertheless, after the date of the assignment, continued and prosecuted to the close, under a retainer from the assignee; that at the successful termination of the proceedings there was paid to the defendants acting under such retainer, the sum of $6,628.47, subject, however, to the payment therefrom of all costs of the government and its claim upon a certain warehouse bond against Wellington  Kidder, which liabilities aggregated $1,701.64, and were required to be paid as a condition of the remitted forfeiture; that these sums were paid and the actual net proceeds received by the attorneys, and belonging to the assignee was the sum of $4,223.84. Out of this sum the referee allowed to Webster  Craig $2,223.84 for their reasonable *Page 559 
services and expenses, but refused to allow them the remaining sum of $2,000, which they paid out to an agent or assistant at Washington, and which they claimed a right to retain.
Two other facts were distinctly proved, and stand in the evidence without contradiction. One of these was, that prior to the assignment, there were pending against Wellington  Kidder, in addition to the proceedings for forfeiture, a criminal proceeding at the suit of the government, in which members of the firm were arrested and held to bail; and a civil action to recover $10,000 for unpaid custom duties; and that after the assignment, two other suits were brought against the assignors by the United States upon warehouse bonds. So that in all there were five cases pending, in each of which Webster  Craig appeared as attorneys and acted in behalf of the parties assailed. These facts are substantially found by the referee, though he does not state the order or precise dates of the suits commenced. The second fact distinctly proved was, that the services rendered professionally by Webster  Craig in all these proceedings taken together were worth five thousand dollars, or, at least, between four thousand and five thousand dollars. This fact was proved by the testimony of United States Commissioner Osborn, who was familiar with the whole transaction, and whose estimate of the value of the services rendered stands wholly unassailed and unimpeached. This fact the referee refused to find upon request, to which refusal an exception was taken. The refusal, as stated in the case, must have been upon the ground that the fact so clearly proved was immaterial, and, therefore, a finding upon it was unnecessary. It is impossible to construe it otherwise in the light of the facts established.
We are of opinion that the fact proved was material, and if it had been found, would have made it the duty of the referee to have rendered a decision in favor of the defendants instead of against them. If there had been no assignment by Wellington 
Kidder, it is very certain that their attorneys, upon the receipt of the money remitted by the government, would have had a lien upon it for the value of all the services rendered. *Page 560 
That was held by this court in Bowling Green Savings Bank v.Todd (52 N.Y. 489), where it was said that the lien existed upon the papers in a particular foreclosure suit, not only for the costs and charges in that suit, but for any general balance in other professional business; and it was added that the lien attached to the money received and collected, and was a rule not peculiar to attorneys but applied to an ordinary factor. The lien, too, is not confined to services rendered in a suit but extends to others outside of a regular litigation. (In reKnapp, 85 N.Y. 284.) As against Wellington  Kidder, in the absence of any assignment by them, it must be granted that the attorneys had a lien upon the fund restored by the government to the full amount of their just and reasonable charges. We do not see how that lien was modified or lost by the general assignment to plaintiff. The latter could only take subject to the equitable right of the attorneys to be paid for their services out of the proceeds of the litigation. The moment that assignment was made, the plaintiff, in his capacity of trustee over the assigned property, became interested in all the litigations. His interest in the proceedings for remission is strongly insisted upon by him. The three actions brought to recover for the violation of the customs were likely to affect the assigned estate at least in respect to the remission proceedings, which could only succeed upon the theory that the assignors were innocent in their violation of the law of any intentional wrong. They were purposely included in the petition for remission, in order that all might be disposed of by that proceeding. The assignee recognized this situation of affairs and his duty in the premises, by adding his retainer to that of the assignors, and so preserved the authority of the attorneys unbroken. The assignee took subject to their equitable right at the date of the assignment, and for the subsequent services as against him a further lien arose when the money was actually collected. It has been held that the attorney's lien for his costs on a fund recovered by his exertions cannot be affected by an assignment to another. (Haymes v. Cooper, 33 Beav. 431.) Much clearer must that rule be where the assignee adds *Page 561 
his retainer and practically takes the place and assumes the obligation of the assignor. It seems impossible to avoid the conclusion that Webster  Craig had a lien upon the fund which came into their hands for the full amount of their reasonable charges. If the referee had found the fact, as he was requested and was bound to do from the uncontradicted evidence, that such reasonable charges were, at least, four thousand dollars, it would have entitled the defendants to have retained the whole or nearly the whole of the fund in their hands, and made the judgment recovered impossible. While it is true that no technical counter-claim for these services is set up in the answer, it is also true that the pleading alleges their performance and value, and the right of the defendants to retain for their payment the whole sum realized from the government. Whether the payment to Flagg was rightful or not becomes in this view of the case immaterial. It was paid by defendants out of their own money. Necessarily, the attorney's lien in this case was measured by the value of his services. That would have been true as the law now stands, even had the case been one of a judgment collected, in which costs were awarded to the party. (Rooney v. Second Ave.R.R., 18 N.Y. 368; In re Knapp, supra; Ackerman v. Ackerman,
14 Abb. Pr. 229.)
The General Term, therefore, were justified in their action; and their order should be affirmed and judgment absolute against the plaintiff on his stipulation awarded in favor of the defendants, with costs.
All concur.
Order affirmed and judgment accordingly.