Court Opinion

ID: 5260414
Source: CourtListenerOpinion
Date Created: 2022-01-06 18:41:04.074534+00
Date Added: 2024-06-11T08:28:04.524482
License: Public Domain

Putnam, J.:
We hold that the payments by defendant made under the 1908 agreement were not divested by the second (1910) agreement. This conclusion is fortified by the subsequent transactions and the course of continued remittances, which plainly show the practical construction that the parties themselves placed on these agreements.
However, the item .of $3,821.49 for fees and percentages received from outside property owners, stands on a different ground. Such property owners had no contract relations with or through the plaintiff. The opinion of the trial court and *742the interlocutory judgment thereon do not go so far as to call defendant to account for such outside fees. The interlocutory judgment, which fixed the terms and limitations of this accounting, required that the “ defendant account for and pay to the plaintiff the amount of the percentages of the awards collected by him on behalf of the plaintiff.”
But apart from these specific provisions limiting the scope of the accounting, there is no satisfactory ground in law or equity to decree to plaintiff such percentages from outside persons standing in no privity with the plaintiff.
This illegal agreement, even when its invalidity had been declared, we have held still left defendant under a duty to make restitution to plaintiff for money equitably due to it. But plaintiff as a corporation cannot be decreed counsel fees judicially allowed for compensation to other landowners. That would enforce and affirm the very invalidity that has been denounced. The whole $3,821.49 was collected after September 30, 1911, and of that sum $1,182.14 was received after this suit had been begun.
On September twenty-seventh defendant offered a payment of $11,031.78 upon the express understanding “ that all disputes to date are settled and that hereafter I am only to pay you whatever fees I collect under your contracts and such witness fees as are collected by me on cases where you paid or advanced the witness fees.” In the following January defendant took substantially the same ground.
This offer of September twenty-seventh was formally accepted by plaintiff’s attorney, with a reservation not material here. Probably for want of consideration this exchange of letters and the ensuing payment did not make an effective release. It, however, separated and marked off such later collections from those of plaintiff’s moneys equitably due. Plaintiff had no equitable claim to share in such fees which are res inter alios, and are only brought into the controversy as the fruit of an illegal and illicit secret agreement. The determination by the trial court did' not go as far as this. It would be against equity precedents. (McMullen v. Hoffman, 174 U. S. 639.) Such invalidity need not be specially pleaded. (Williston Cont. § 1630a.)
The annulment of this contract, therefore, left plaintiff *743entitled only to what was its own money and to restitution and repayment of its advances. Plaintiff may not have such fees as a form of damages for -the breach of one of the illegal covenants, namely, to pay or divide counsel fees in suits not connected with retainers of the plaintiff. (13 C. J. 448, n. 24.)
The items of the $3,821.49 do not represent unpaid disbursements by plaintiff. The opinion does say: “ The plaintiff advanced witnesses’ expenses in most, if not all, of- these cases.” But in other totals all these advances have been charged against defendant and are embraced in this accounting.
The recovery should, therefore, be reduced by striking out and excluding the item of $3,821.49, 'and as thus modified, the judgment should be affirmed, with interest and costs of the action, but without costs of this appeal to either party.
Present — Jenks, P. J., Rich, Putnam, Blackmar and Jaycox, JJ.
Recovery reduced by striking out and excluding the item of $3,821.49; as thus modified the final judgment is unanimously affirmed, with interest and costs of the action, but without costs of this appeal to either party. Settle order with corrected findings on notice.