Court Opinion

ID: 5436415
Source: CourtListenerOpinion
Date Created: 2022-01-08 17:54:58.527754+00
Date Added: 2024-06-11T08:31:51.290663
License: Public Domain

Sawyer, J., concurring specially:
This is an action to recover attorney’s fees in the suit of French v. Central Pacific Railroad Company and Western Pacific Railroad Company, in which plaintiffs, upon the request of the President and officers of the company, acted as attorneys and conducted the defence to a successful termination. The defendant, as the result of the litigation, received into its treasury two hundred and fifty thousand dollars of the bonds of the City and County of San Francisco. The main point, in the case, to which all others is subordinate, is, that there '» was no contract of retainer in writing between plaintiffs and j defendant, and, for that reason, no liability could be incurred by the defendant to pay for the services. The question arises, under section ten of the Act of 1861, concerning railroad corporations, which provides that “ the Directors shall cause to be kept a book, to be called ‘ Becord of Corporation Debts,’ in which the Secretary shall“record all written con- (\ tracts of the Directors and a succinct statement of the debts of the company, the amount thereof, and with whom made; which book shall at all times be open to the inspection of any ' stockholder or party in interest. When any contract or debt shall be paid or discharged, the Secretary shall make a memorandum thereof in the margin, or in some convenient *200place in the record, where the same is recorded. Ho contract shall be binding upon the company unless made in writing.”
The last clause is the one supposed to be an insuperable obstacle in the way of a recovery in this case. When taken in connection with the context, it is not so clear what was intended by this provision. But, manifestly, it cannot possibly have been intended to have so broad a scope as is claimed for it; for, to give it such a construction, would be, t.o so ¡utterly bind the company down to a mode of proceeding, that, under it, it would be utterly impossible for it to perform its functions, or transact its ordinary business. It could not do the least thing in the way of contract, whereby a right is acquired, or a responsibility incurred about the smallest matters, which are occurring every minute in the day, without making a contract in writing and having it recorded by the Secretary in the “ Eecord of Corporation Debts.” It would be impossible to make a contract, although fully executed on one side, which would bind the other party, to carry a passenger, or a pound of freight from station to station, or purchase a cord of wood, or a pint of oil, without these formalities. To give the provision any such construction would be absurd in the extreme. Ho man in his senses could knowingly vote for such a law, and no sane man would attempt to build, or operate, a railroad under its provisions. The provision must be limited to express contracts wholly executory — such contracts as are generally made in the ordinary course of business, when important matters are involved, and there is time for deliberation, and in which the terms are usually arranged in advance, and specified with more or less particularity. It cannot refer to those liabilities, which the law itself implies from benefits received, and actually enjoyed, without making any express contract in advance, where the services have been performed on one side, and the consideration received and enjoyed by the other. The provision itself says, all “ written contracts ” shall be recorded, as if there would necessarily be other contracts. If there were to be no others *201of any kind, why not say all contracts ? All the provisions ■ must be construed together, and so construed, if possible, that while some significance is allowed to every word, there may still be no conflict. The corporation has a capacity to be sued, and when sued it is bound to appear and ■ defend its interests, or they will be sacrificed, and it can only appear by attorney. The employment of an attorney is not ultra vires. It is one of the necessities resulting from the capacity to be sued, likely to occur at any moment, and the emergency may be sudden. The law itself casts upon the corporation the necessity of defending its rights when sued, and it may be impossible to make a written contract with an attorney. It takes two to make a contract. The corporation defended in this instance, and the question was, whether it should gain, or lose, the sum of two hundred and fifty thousand dollars. It could only maintain its right by appearing by attorney. The plaintiffs appeared with the knowledge and concurrence of the officers of the defendant, and made a successful defence. The corporation actually received, and it still retains, the avails of the litigation. This reception of the ¿proceeds is a corporate act, for there is nothing to inhibit it. It had the benefit of the service without making any express contract. The service was performed, and the benefits enjoyed, and there is nothing to inhibit it from availing itself of the service, or enjoying its fruits. Can it now retain and enjoy, the avails of the litigation, and escape liability fon the service by which they were acquired ? In my judgment,: the provision in question has no application, and the law of the land casts upon the defendant the liability to pay what the services are reasonably worth. The question might have been different had the contract of retainer been wholly executory, only, and an action been brought by either party to recover damages for a breach in not performing. This provision has been since repealed, and its construction with reference to later transactions is no longer important.
The case is different from Wallace v. San José. In that *202case the contract itself was ultra vires under the circumstances. There was then no power to make the contract at all. The inhibitory provision was not of a general character, but it was very specific, and' applied particularly to the case then in hand. There could be no doubt about it. Upon the whole, without noticing particularly the subordinate questions, I am not satisfied that there is any error that would justify a reversal of the judgment. The judgment and order denying new trial should be affirmed. ,