Court Opinion

ID: 6565823
Source: CourtListenerOpinion
Date Created: 2022-07-20 19:19:40.31252+00
Date Added: 2024-06-11T15:56:43.591007
License: Public Domain

Mr. Justice White
dissenting:
I can not agree to. a dismissal of this suit, at this time,, upon the record as it now is. To do. so affirms the judgment, in every particular and, as I believe, deprives, at least, two of the plaintiffs in error of a constitutional right.
Pauline M. Fawcett prosecuted a stockholders’ suit, against The Garfield County Coal and Fuel Company and' Perry C. Coryell and Minnie B. Coryell, a majority of the-members of its board of directors. Upon final hearing a decree was entered requiring Minnie B. Coryell to. convey to the-coal company certain lands of the value of $50,000, which she-claimed at her own; that she likewise pay to the company $20,474 in money; that Perry C. Coryell pay to the said company the' sum of $1,000. It was further adjudged in the decree that the company pay to D. M. Campbell and S. J. De.: *360Lan, who had represented the plaintiff in the prosecution of the suit, the sum of $2,500 as attorneys’ fees therein, and a receiver was appointed to take charge of the property and carry on the business of the company.
March 14, 19x2, the company, Minnie B. Coryell and Perry C. Coryell, as plaintiffs in error, presented a transcript of the record and docketed the cause in this court on error, being represented therein by the same attorney that represented them in the trial court. On the same day Pauline M. Fawcett, the defendant in error, through an attorney of this court, H. J. O’Bryan, filed a confession of errors and consent that the judgment be reversed and annulled, and that a judgment be entered in this court dismissing the complaint. Plaintiffs in error thereupon applied for a supersedeas, and, at the time of the hearing thereof, the confession of errors was brought to the attention of the court. Upon an inspection of the record, it appearing that the decree ordered' the payment by the coal company to Messrs. Campbell and De Lan of1 a certain sum ás attorneys’- fees, it was thought wise, before taking action in the premises, to advise them of the confess sion of errors filed, which was done. Thereupon Messrs. Campbell and De Lan, by telegram, and subsequently by letters, entitled in the cause and addressed to- the clerk of this court, protested against the acceptance of the confession of errors and the disposition of the cause thereon, claiming to be the attorneys authorized to act. for the defendant in error. Within two or three days thereafter, defendant in error, in her own proper person, presented for filing in this court a paper, entitled in the cause, wherein she denied the authority of Campbell and De Lan, or either of them, to represent her in the suit in this court, declaring that they had no right or authority to appear for her in said cause in any way, and that H. J. O’Bryan was her attorney therein. Thereupon this court, of its own motion, appointed 'a commissioner to take testimony with reference to the preparation and filing of the confession of errors, but in no wise designated the witnesses *361to be examined, or the scope of the inquiry. The witnesses examined were E. E. Clover, attorney for plaintiffs in error; Pauline M. Fawcett, defendant in error; Henry J. O’Bryan,. the attorney representing her in this court; Perry C. Coryell,, one of the plaintiffs in error; D. M. Campbell and S. J. De Ean, the attorneys who had represented defendant in error in the court below, and J. D. Fillmore, a clerk in the office of S. J. De Ean.
Plaintiff in error, Minnie B. Coryell, neither testified, nor does the record disclose that she was present at, the hearing before the commissioner. Moreover, contrary to the statement in the opinion, it does not appear that the Coryells and Miss Fawcett had various meetings, conversations and negotiations, and had reached a conclusion whereby the rights of the Coryells, the company and Miss Fawcett were settled and the matters in litigation adjusted. The only meetings, conversations and negotiations that were had, if any, were between Perry C. Coryell and Miss Fawcett, and there is no evidence that Minnie B. Coryell was in any wise apprised thereof. Besides, the testimony is positive that nothing whatever was paid or promised Miss Fawcett as a consideration for the filing of the confession of errors. Her testimony is specific that she was prompted thereto solely by reason of' the production and inspection of a forgotten letter written years before, wherein she had sold and placed in trust for delivery the shares of stock in the company which she had, prior to the determination of the suit, believed she owned and which trust had been carried out according to its terms. The testimony of Perry C. Coryell is to the same effect, and there is none of a direct nature to the contrary. If • this court, upon evidence taken for the purpose of ascertaining the relation of at: torneys to a confession of errors filed, disregards the positive testimony of two of the interested parties to a suit, and, from inferences only, finds that the cause was settled as between the two, it surely can not properly extend that finding to another party to the suit who was neither a witness heard' *362therein, nor apprised that the inquiry- would extend to the question of whether or not a settlement of the litigation had been made. Therefore, the court can not, it seems to me, consistent with the rules of procedure and the principles, of justice, foreclose the constitutional right of Minnie B. Coryell, at least, to have the enormous judgment entered against her reviewed by writ of error in this court. It is. said that the only reason for lodging the case here was the belief of the parties that a reversal of the judgment and the dismissal of the complaint would defeat the rights of Campbell and De Fan to the attorneys’ fees allowed them. If it be true that some of the parties so intended, the record certainly does not disclose, even by inference, that Mrs. Coryell shared in such intent or had knowledge thereof.
' It is asserted, presumably to- show that no harm will follow an affirmance of the judgment by dismissal of the writ of error, that Mrs. Coryell is the owner of all the capital stock of the corporation, except two- shares held by Perry C. Cory-ell and Perry C. Coryell, Jr., and that the Coryells constitute the board of directors, and the company has no debts. If the statement, as to- the ownership of the stock, control of the corporation and its freedom from indebtedness, be true, it in no sense changes the situation nor removes the probability of grave injustice being done the Coryell judgment debtors. The record shows conclusively that forty-five thousand (45,-000) shares of1 the capital stock, being all thereof except five thousand (5,000) shares claimed at the time of the suit by Miss Fawcett, are in the possession of a bank as collateral security upon an indebtedness to the bank of some person or corporation hot disclosed. Suppose the payment of such indebtedness is defaulted? Thereupon the bank resorts to the collateral security and sells the shares of stock. It wo-uld necessarily follow that the new holder of the stock could force payment into the treasury of the corporation of the judgments against the Coryells, affirmed by the dismissal of this writ of error.
*363Moreover, I am not convinced that the record is conclusive that the corporation is not indebted at the present time. It shows that several years ago all indebtedness was paid, but not the negative of subsequent indebtedness. Whatever the condition of the corporation was then, does this court know its condition now? Besides, the record shows that the concern is now in the hands of a receiver authorized to carry on its business, to incur indebtedness, to collect money and property due the company, and to make distribution thereof. But, let us suppose, at this time, there are no debts of the corporation, that the Coryells own all the stock, that the receiver is discharged and the Coryells, as a board of1 directors, cause the corporation to satisfy of record the judgments involved in this suit. Thereupon the stock passes into the hands of others, or the corporation becomes financially involved. Is it at all certain that the new holders of the stock, or the creditors of the corporation would be precluded from forcing the payment of the judgments in question, or a surrender to the corporation of the property claimed herein by Mrs. Coryell ? If the property which she holds and claims as her own actually belongs to the corporation, as adjudged by the decree herein affirmed, would it not seem that whosoever acquired ownership of any portion of the capital stock of the company could force a re-conveyance of such property to the corporation from one who had been released from such obligation without consideration, by an act of the corporation which was,.at the time of the release under the full control of the person released ?
But were we to assume that all the parties to the litigation participated in the acts and things which, in the opinion of the court, constitute a settlement of the litigation, it would not, in my judgment, warrant a dismissal of the writ of error. Substantial judgments actually exist against two of the plaintiffs in error. There is no claim that these judgments have in any wise been satisfied or discharged. The only claim is that Miss Fawcett was satisfied in some way. Neither should the writ be dismissed, though it be true that one of the purposes *364thereof, in conjunction with the confession of errors, was to> deprive Campbell and De Lan of that which was their just due. Their fees were earned in the trial court, not in this. The proceedings here constitute a new suit and the employment of attorneys in the court below does not constitute them attorneys in the proceedings here. It is quite true that attorneys should be paid for their services, and Campbell and De Lan are entitled to theirs, 'and may receive them in a proper proceeding either in the court below, or, perhaps, by intervention in the proceeding here. If the allegations of the complaint and the admissions of the answer disclose a certain state of facts, and these attorneys have rendered services justly chargeable under such facts,, to the corporation itself, it would necessarily follow that the corporation would be estopped, as between itself and the attorneys, from denying the existence of .such facts. A reversal of the judgment would send the matter into the district court, possessed of full jurisdiction in the premises, where all parties could be heard and the matter properly adjusted.
But it is said that the writ of error is not prosecuted in good faith; that its purpose, together with the confession of errors, was to secure a reversal of the judgment and a dismissal of the complaint, and that it was unnecessary to bring the case here, as that could have been accomplished in the district court, or at least a settlement therein made. If it is meant by this, that the district court could have rendered the relief a judgment of reversal would afford, a sufficient answer thereto is, that the term of the district court, at which the decree was entered, had expired prior to the time that Miss Fawcett concluded that she was in the wrong. The district court was, therefore, powerless to set aside, change or modify its decree in any particular. Again, how could a settlement have been made in, the district court ? The Coryells constituted the board of directors of the corporation. The judgments are against them and in favor of the. corporation. Under these circumstances, it is probable that neither the Cory-*365ells nor the corporation itself could safely discharge pr satisfy the judgments without payment thereof. Nor is it certain that Miss Fawcett possessed that power. She was, in legal effect, a trustee for the corporation, suing for herself and those similarly situated. However, were we bo assume that the entire matter could have been adjusted in the district court, because it was not, is this court to dismiss the writ of error, thereby affirm the judgment, and thus impose upon the Coryells a payment aggregating over $71,000 in money and property which they claim they do not owe? Would it not be wiser and more consonant with sound judicial procedure to reverse the case and let the entire matter be inquired into where all parties may be heard, a full inquiry had, every one’s rights protected and substantial justice done?