Bank of Glade Spring v. McEwen
Bank of Glade Spring v. McEwen
Opinion of the Court
This case was brought bere by tbe appeal of tbe plaintiff from an order upon a motion of tbe defendants to set aside a consent judgment, and presents tbe following facts:
Plaintiff, as a judgment creditor of S. M. McEwen, brought an action by tbe above title to impeaeb and set aside two deeds of trust, one executed on 16 October, 1909, by S. M. McEwen and bis wife, Nannie B. McEwen, to Gr. L. Park, as trustee, to secure a debt due to W. T. McEwen for $2,500, wbicb amount bad been advanced to tbe plaintiff by said W. J. McEwen at tbe request and for tbe benefit of tbe defendant, S. M. McEwen, and tbe other executed on 18 October, 1909, by tbe said S. M. McEwen to T. E. Parker as trustee for tbe benefit of Nannie B.
1. Was tbe deed of trust from S. M. McEwen and wife to G-. L. Park, trustee, on 16 October, 1909, made witb tbe intent to binder, delay, defeat, and defraud tbe plaintiff? Answer: Yes.
2. If so, did W. J. 24jcEwen baye knowledge of said fraudulent intent and participate therein? Answer: Yes.
3. Was tbe deed of trust from S. M. McEwen and wife to Eugene Parker, trustee, on 18 October, 1909, made witb intent to binder, defeat, delay, and defraud tbe plaintiff? Answer: Yes.
4. If so, did Nannie B. McEwen baye knowledge of tbe fraudulent intent of ber busband, S. M. McEwen, and participate therein? Answer: Yes.
Judgment was entered upon tbe yerdict, to tbe effect that tbe deeds of trust should be canceled, and defendant W. J. McEwen baying moved in apt time to set aside tbe yerdict to tbe extent that it affected bis interests adversely, and tbe judge having intimated that be would grant tbe motion, tbe plaintiff’s and defendants’ attorneys agreed, at tbe suggestion of tbe court, that tbe equities of tbe parties should be adjusted and settled upon tbe following basis: Tbe issue of fraud as to W. J. McEwen to be set aside and tbe land described in tbe deed of trust to Gr. L. Park to be sold and tbe proceeds of sale to be applied, first, to- tbe costs of tbe action, and tbe balance to tbe payment of tbe debt for $2,500 due to W. J. McEwen, and then to tbe payment of tbe judgment creditors, and any surplus to be paid to Nannie B. McEwen. This agreement was inserted in tbe consent judgment, which was signed by Judge Lyon and tbe attorneys of tbe respective parties at Fall Term, 1911. This judgment was entered without tbe knowledge or consent of Mrs. Nannie B. McEwen or ber busband, and without any authority given by them, or either of them, to their attorneys to consent to tbe judgment, and really against their consent. These defendants, after having successfully applied for an injunction
The learned judge was manifestly right in holding that so much of the alleged consent judgment, signed by Judge Lyon, as did not receive -the consent of the defendants S. M. McEwen and wife, Nannie B. McEwen, and which prejudiced their rights, was not binding upon them; but instead of amending or reforming the judgment, he should have set it aside altogether. It appears that the defendants McEwen and wife held the land by entireties, and it is insisted by their counsel that it could not be sold to pay the judgment creditors of the husband, unless with the consent of both, and only to the extent that they had encumbered it, and the court could not sell it without their consent, which was not given. They rely on Bruce v. Nicholson, 109 N. C., 202, where it was held by this Court: “Under a conveyance of land in fee to husband and wife, they take, not as tenants in common or joint tenants, but by entireties with the right of survivorship, each being seized per tout et non per my; neither can convey or encumber the estate without the assent of the other, nor can the interest of either become subject to the lien, or any proceeding to sell for the satisfaction of any judgment during their joint lives. . . . The nature of this estate
It is found by Judge Daniels tbat defendants McEwen and wife never consented to tbe judgment, and tbat counsel bad no authority to consent for them. This was known to plaintiffs at tbe time tbe consent judgment was entered, for it was stated in open court by defendants’ counsel tbat they bad not consulted with their clients in regard to tbe proposed consent judgment, as they lived at a great distance, in Tennessee, and there
Tbe power of an attorney witb reference to tbe release of bis client’s interests is fully considered in Hall v. Presnell, 157 N. C., 290, and we therein said: “As said in Bank v. Hay, 143 N. C., 326: ‘There is a general rule that, when one deals witb an agent, it behooves him to ascertain correctly tbe scope and extent of bis authority to contract for and in behalf of bis alleged principal, for under any other rule, it is said, every principal would be at tbe mercy of bis agent, however carefully be might limit bis authority. Tbe power of an agent is not unlimited unless in some way it either expressly or impliedly appears to be so, and tbe person who proposes to contract witb him as agent for bis principal should first inform himself where bis authority ■stops or bow far bis commission goes, before be closes tbe bargain witb him. Biggs v. Insurance Co., 88 N. C., 141; Ferguson v. Manufacturing Co., 118 N. C., 946.’ No one could reasonably suppose that it was witbin tbe scope of an attorney’s authority to release a debt or any party to a note, or to do anything which would have that effect, when bis commission extended only to tbe collection of tbe debt. It is stated in tbe books that an attorney has no implied authority to work any discharge of a debtor but upon actual payment of tbe full amount of tbe debt, and that in money. He cannot release sureties or indorsers nor enter a retraxit, when it is a final bar (Lambert v. Sanford, 3 Blackford, 137), nor release a witness (Ward v. Hopkins, 2 Pen. (N. J.), 689; Campbell v. Kincaird, 3 Mon., 566), nor a party in interest (Succession of Wright, 18 La. Ann., 49). It is a general rule that an attorney, who in many respects is considered as a mere agent, cannot waive any of tbe 'substantial rights of bis client without tbe latter’s consent, and in such a case be is not barred thereby,. without ratification, or something which amounts to an estoppel, to deny bis attorney’s authority. These principles will be found to be sustained by tbe following authorities: Weeks on Attorneys,
In Savory v. Chapman, 39 E. C. L., 242 (11 Ad. Ell., 829), Justice Patteson lays down the law upon this subject very clearly and succinctly, and what is stated in the same case by Justice Golerichge is so appropriate to the facts in our record that we quote it as he said it: “A party is bound to know the legal qualifications of persons filling certain employments. The question, therefore, turns on the authority of the attorney; and there is nothing here to show that he had any, either in his general character or with reference to the circumstances of the suit. He could, as it appears here, be only an agent áe factoj and there is nothing shown to make him one for the present purpose.” It seems, therefore, to be the generally accepted doctrine that an attorney charged with the collection of a debt, has no power, in virtue of his general authority, to do any act which will either release his client’s debtor or his surety, nor can he materially jeopardize his client’s interest in any way. An attorney at law is an officer in a court of justice, who is employed by a party in a cause to manage the same for him (4 Oyc., 897), and his client is concluded by his acts done within the range of his authority. “An attorney’s authority is not limited to the mere prosecution of the suit, but extends to everything necessary to the protection and promotion of the interests committed to his care, so far as they are affected by proceedings in the court-where he represents his client.” 4 Cye., 934, and cases cited. An attorney cannot compromise his client’s case 'without special authority to do so, nor can he, without such authority, receive in payment of a debt due his client anything except the legal currency of the country or bills which pass as money at their par value by the common consent of the community. A subsequent ratification of the acts of the attorney is equivalent to a special authority previously granted to do those
In Alspaugh v. Jones, 64 N. C., 32, where the question of authority from client to attorney, and the extent of that authority, was before the Court, Justice Settle, in writing the opinion of this Court, said: “His Honor should have left it to the jury to say whether or not he was the attorney of the plaintiff; and if he was, it was for them to find how far his authority extended.”
An attorney may submit his client’s cause to arbitration without his knowledge or consent, as this is one of the modes of trial, and the client’s assent to it is implied, and if it is wrongfully done, the client’s remedy is an action against the attorney for damages (Thomas v. Hews, 2 C. & M., 327); but he cannot compromise his client’s case without his authority, Halker v. Parker, 7 Cranche, 436. These principles were approved and applied in the leading case of Morris v. Grier, 76 N. C., 410, which cites in support of them, Jenkins v. Gillespie, 10 Smedes and Marsh (Miss.), 31; Rex v. Hill, 7 Price, 630; Moye v. Cogdell, supra; Thomas v. Hews, supra; Buckland v. Conway, 16 Mass., 396; Halker v. Parker, supra. “Although counsel has complete authority over the suit, the mode of conducting it, and all that is incident to it, such as withdrawing the record, withdrawing a juror, calling no witnesses, and other matters which properly belong to the suit, and the management and conduct of the trial, he has not, by virtue of his retainer in the suit, any power over matters which are collateral to it.” Pollock, Ch. Baron, in Swinfen v. Chelmsford, 2 L. T., N. S., 406.
Mr. Weeks says an attorney, in the management of a suit, has a very extensive authority, which springs from his general retainer. He has the free and full control 'of a case, in its ordinary incidents, and to this extent he is not bound or required to consult his client (section 220), and that an agreement to refer the cause, or to arbitrate, comes within the scope of the attorney’s general authority, the weight of authority being to the effect that he cannot compromise his client’s interests, citing Halker v. Parker, supra, in which Chief Justice Marshall, delivering the opinion, said that the client is not bound by a com
Having settled this question as to the scope of an attorney’s authority, and remarking that in this case plaintiff had notice that they did not profess to act with special authority to agree to a sale of the land held by entireties, we proceed to a consideration of the next and last question.
The court had the power to set aside the decree, as. a whole, but not to eliminate from it that part only which affected the defendants McEwen and wife, prejudicially. The agreements of the parties were reciprocal, and each was the consideration for the other. If you take out what hurts the said defendants, what is left is not what was agreed to. The plaintiff might well say, “I made no such contract” (non hcec in, federa veni). Besides, the supposed voluntary relinquishment by defendants of their land to sale formed the consideration for plaintiff’s release of certain of its rights. Equity and common fairness, therefore, demand that the entire decree be vacated. We said in Massey v. Barbee, 138 N. C., 84: “He must abide by that judgment, as it was written with his consent. The court cannot change it, but can only construe its provisions. We find no expression in the judgment indicative of such an understanding, and there is no rule of law by which we are authorized to read it into the contract of the parties, or by construction to give the latter a meaning which its words will not warrant. We have no more right to construe the agreement of the parties contrary to its spirit and intent than we have to vary or modify its terms without the consent of the parties. The rights of the parties must be determined solely by the judgment to which they have assented. The law will not even inquire into the reason for making the decree, it being considered in truth the decree of the parties, though it be also the decree of the court, and their
The correct procedure is stated in Aronson v. Sire, 85 N. Y. App. Div. (1903), page 607: “An interlocutory judgment, in strict accordance with a stipulation entered into between the parties, cannot be amended on a motion made by one of the parties and opposed by the other; the remedy of the party objecting to the form of the judgment is to make a motion to
The authorities cited by plaintiff’s counsel, to the effect that a consent order cannot be vacated except by consent of all the parties, are not in point, as in them the attorneys were only exercising their ordinary functions in the prosecution or defense of the suits, and were not giving away their client’s rights, which were not involved therein, being entirely collateral. The very nature of the transaction here was notice to the plaintiff of a lack of authority in the attorney, and, moreover, the plaintiff had actual notice of it, as the judge finds. Besides, in the eases cited by counsel for plaintiff, it was assumed, or was the case, that consent had actually been given, and the attempt was to amend the agreement, or, ignoring or repudiating the consent, to vacate it. Such was the fact in Stump v. Long, 84 N. C., 616; McEachern v. Kerchner, 90 N. C., 177. In Henry v. Hilliard, 120 N. C., 479, the consent to the order was the exercise of one of the inherent rights of the attorney and within the general scope of his authority under his retainer. It related to the proceedings in the cause. The case of Ladd v. Teague, 126 N. C., 544, which has been called to our attention, stands upon the same footing. It was there a waiver of a jury trial and a consent “that the judge might find the facts and adjudge upon them according to the law.” It rests upon the same principle as the attorney’s power to consent to a reference, and relates to a question of practice or procedure. The attorney is intrusted
Defendant contends that tbe judgment can be modified in part, and reasons substantially in this wise: “If it is found as a fact that an error has been committed, along with an act of right, then are we required to undo tbe righteous act in order to correct tbe evil ? Tbe idea that a court cannot correct its mistakes is too antiquated to admit of argument. This question was ably fought out during tbe reign of James I. of England, when equity first began to exercise tbe power to set aside and modify judgments at law. In that great controversy Lord Coke defended tbe time-honored practices of tbe courts of law, while Lord Ellesmere defended tbe advanced idea of giving to tbe courts of equity tbe right to set aside or to modify judgments of law. In that well-fought legal battle, equity won (and we add, as all good causes should win), and its protecting arm has ever since been thrown around unfortunate litigants. 1 Story’s Eq., sec. 51; Spence Obanc. Jur., p. 674.” But tbe authorities, supra, and others cited, refer to ordinary judgments in inmitum, and not to those rendered by consent. If tbe Court should withdraw an essential part of tbe judgment, which was entered by consent, it would surely destroy tbe agreement, and this it has no power to do. As Judge Gaston said in Wilcox v. Wilcox, 36 N. C., at p. 41, we can very well understand tbe propriety of tbe Court refusing to rehear a decree rendered by consent, because it is, in truth, a decree of tbe parties, and in such a case their will is a sufficient reason for it (stat pro rations vohmtas). Tbe court takes no part in tbe formation of tbe consent, but merely enters its decree in conformity therewith. But before there can be such a decree, it is absolutely
"What judgment to render here, presents a more serious and difficult problem, but we have concluded that as by the abortive agreement the defendants have lost their right to prosecute an appeal to this Court from the verdict, having moved for a new trial in due time for that purpose, and the judge having left the district, the only equitable thing left for us to do is to set aside the verdict and judgment, in analogy to those cases where some accident, e. g., loss of papers, has thwarted the appeal. The parties can give a fresh consent, or can start anew from the beginning and try out the issue of fraud to a final lecree. It is, therefore, ordered that the judgments of Judge Daniels and of Judge Lyon be set aside, and also the verdict, and that the case stand for trial upon the issues joined between the parties.
We have not adverted to the form of the proceeding, as being a motion and not an independent action, as no point was made in respect to it, and we are not, therefore, called upon to express any opinion in regard to it. We consider that the parties have elected to place the decision upon the real merits of the controversy, -without regard to mere form, so that their rights may the more speedily be determined. It is not intended to intimate that a motion is not the proper remedy.
We are indebted to counsel for their excellent briefs, filed in the cause, which exhibit unusual ability and research, and have been of great utility to us in the investigation • of the important questions involved.
We must1 declare that, there was error in the proceedings and judgment of the court below.
Error.
Reference
- Full Case Name
- BANK OF GLADE SPRING v. S. M. McEWEN
- Cited By
- 9 cases
- Status
- Published