Court Opinion

ID: 6821555
Source: CourtListenerOpinion
Date Created: 2022-07-23 19:07:51.397599+00
Date Added: 2024-06-11T16:04:08.968643
License: Public Domain

Campbell, C. J.,
dissenting.
I am unable to concur in the conclusion of the majority opinion in regard to the question of costs.
This case is before us on an appeal from a decree entered by the Court of Law and Chancery of the city of Norfolk. The decree settled in toto the merits of the case and this action of the chancellor is not challenged in any particular.
A sufficient statement of the case, as shown by the report of the commissioner appointed by the court, is this:
Percival Hall and Forrest H. Hill, during the latter part of 1941, decided to form a corporation to be known as Hydraulic and Gas Engineering Corporation, and on December 29, 1941, its charter was granted by the State of Delaware. On January 19, 1942, the corporation was domesticated in the State of Virginia. A total of ten shares of stock of the par value of $100 were issued, of which Percival Hall received 8 shares, Forrest H. Hill 1 share and Mrs. Hazel W. Rudisill (now Mrs. Percival Hall) 1 share. Percival Hall paid the corporation $1,000 in cash for the 10 shares issued as aforesaid.
On January 19, 1942, Hall was elected president, Hill was elected vice-president and Semmes Chapman was elected secretary and treasurer of the corporation. The principal purpose of the formation of the corporation was to engage in the business of constructing and installing gas systems and equipment for the United States government in the Defense Housing Project in the area near the city of Newport News, Virginia.
*354On June 25, 1942, the corporation entered into a contract with the government to construct the necessary units required in the installation of the houses being built. Being in need of financial and other assistance, the corporation entered into a contract with George T. McLean and Nicholas C. Wright, to secure a line of credit of $75,000 or more, in order to procure materials and labor. McLean and Wright, through negotiations with the Seaboard National Bank of Norfolk, Virginia, secured the necessary funds which were deposited in that bank. (The bank has no interest in the outcome of the present controversy and is only a nominal party as the holder of certain funds claimed by the litigants.)
After the completion of the contract between the corporation and the government, a controversy arose between Hall and Hill over a division of the proceeds.
On May 20, 1943, Hill filed his bill in chancery against Hall, McLean, Wright and others, the primary object, of the suit being to enjoin Hall from issuing checks against the funds held by the bank and from disposing of any of the personal property of the corporation. In this bill it is specifically set forth that McLean, Wright and the Seaboard National Bank are made parties thereto “solely because of their interest in these proceedings and without intending at this time to litigate any rights or controversies arising between complainant and such parties.”
Appellants filed their answer to the bill of complaint and, in addition thereto, filed a cross-bill seeking an accounting between Hydraulic and Gas Engineering Corporation and complainants for the purpose of ascertaining the amount due them by the corporation. A temporary injunction was decreed to Hill by the court.
A commissioner was appointed to take an account and upon final adjudication, the court entered a decree confirming the report of C. Dodson Morrisette, commissioner, based upon the merits, and also confirmed the report in regard to the apportionment of- costs.
*355As stated, the decree settling the case on the merits is unchallenged. In the decree entered by the court it is adjudged that the costs of this litigation should be borne by the respective litigants in this order: McLean and Wright, 33i per cent, thereof; Percival Hall, 33 i per cent, thereof; and Forrest H. Hill, 33j per cent, thereof, which respective amounts should be deducted from the amount adjudged to be due each litigant. The total amount of costs assessed against McLean and Wright was $1,799.57. The amount assessed against Hall was $1,826.83.
This action of the court is assigned as error by McLean, Wright and Hall.
The general rule in Virginia applicable to the taxation of costs is that the party litigant substantially prevailing in the litigation should recover of the losing litigant the amount expended in and about the prosecution of his interests in the litigation. However, to this general rule there are well recognized exceptions.
Section 3527 of Michie’s Code provides: “The laws of costs shall not be interpreted as penal laws; nor shall anything in this chapter take away or abridge the discretion of a court of equity over the subject of costs, # * * # .” (Code 1887, sec. 3547.)
In Wimbish v. Blanks, 76 Va. 365, this is said: “When this court has determined that the decree of the lower court is right upon the merits, it is not much inclined to interfere with the decision with respect to the costs, unless in a case of palpable error.”
To the same effect is our decision in Dillard v. Dillard, 77 Va. 820.
In Goodloe v. Woods, 115 Va. 540, 80 S. E. 108, we held: “That costs are in the discretion of the court cannot be questioned, and its action will not be reversed except upon a clear showing of abuse.”
A similar rule is announced in Goins v. Garber, 131 Va. 59, 108 S. E. 868.
It is to be emphasized that the original bill of .complaint was filed for the purpose of enjoining Hall from withdraw*356ing funds of the corporation from the Seaboard National Bank. In the contract entered into by McLean and Wright with the corporation, there was a provision that any controversy in regard to the question of costs pertaining to the operation could be arbitrated.
It is further disclosed by the record that appellees were willing that there should be a partial distribution of the funds in bank among the parties. This offer was declined by McLean and Wright and as a result the cross-bill was filed and an accounting prayed for. •
In conformity with the prayer of the cross-bill, the court referred the matter to Commissioner Morrisette. The hearing before the commissioner consumed twenty-one days. A transcript of the testimony consisted- of 1,656 pages and the stenographer’s bill amounted to $1,890.12. In addition to these charges, the court allowed the commissioner a most liberal fee for taking the account.
In my opinion the issues might well have been limited to the issues involved in the original suit. This view is fortified by the fact that no exception was taken by either party to the decree determining the cause upon the merits.
In my view the assignment of error is without merit for the reason that there has been no abuse of the discretion vested in the court by its entry of the decree complained of.