C. G. Horman Co. v. Lloyd
C. G. Horman Co. v. Lloyd
Opinion of the Court
Appeal from a judgment dismissing the complaint and awarding judgment on defendants’ counterclaim for damages and attorney’s fees. Affirmed in part and reversed in part. No costs awarded.
We are of the opinion that most of the Findings reflect the facts accurately, but that some of them are not supported by the record, for reasons we shall relate.
The Findings pertinent to this decision may be summarized as follows: That in December, 1965, the parties executed a written contract having to do with the financing and construction of a motel. Hor-man agreed to aid and become obligated in the financing, for which he would obtain an interest in the facility as tenant in common with the defendants Lloyd. He jointly signed the mortgage note with Lloyds. Thereafter, Horman refused to participate in any further financing which was needed, unless acquiring an additional interest in the property and income. The Lloyds sought other avenues to obtain funds. In a subsequent written contract (dated February 23, 1967) the parties agreed that if Horman desired to assert any further claim in addition to what Lloyds had paid for Horman’s interest, it could be done by suit in the district court if filed within a year, in which case the court could review the original December, 1965, contract, and in which event Lloyds could assert any claims and offsets against any claim arising out of failure of Horman further to help finance the project. Such suit was filed on the 364th day.
In addition to the Findings made above, the record shows unequivocally that in the lien case mentioned in footnote 2 (Case No. 31379, Fourth District Court), the court in that case found that on February 23, 1967, the parties signed a contract, as implemented by another contract dated March 23, 1967, and another dated April 24, 1967, in which they “compromised and settled and fully released all claims existing between themselves” and that by rea
In holding as we do, we are not unmindful of our rather recent case of Barnhart v. Civil Service Emp. Ins. Co.,
The record is barren of any evidence as to a reason for awarding attor
A few words must be said about Mr. Justice Crockett’s dissent: It refers to Bracken v. Dahle apparently for the proposition that agreements to arbitrate are against public policy as ousting courts of their jurisdiction. I believe the case cannot be cited for such a general principle. Under the facts there, such result was reached, but the court clearly recognized that such an agreement might be enforceable. The dissent lifts a quotation from Latter v. Holsum Bread for its proposition. The use of these two cases to justify the dissent’s urgence rides awry when it is noted that the Bracken case is not pertinent, and the Latter case deals with arbitration of future disputes, which renders that case also impertinent here. In the instant case there was no arbitration agreement at all, but an agreement, in truth, not to arbitrate, and contrariwise consciously to present the matter to the court in the first instance, and not to evade it. Assuming that the agreement here was one for arbitration, there is nothing wrong with it since there was an existing, — not a future controversy here, which finds plenary sanction for legitimacy, free from the curse of being against public policy, in Title 78-31, Utah Code Annotated 1953, having to do with ARBITRATION of existing controversies, —which is the case here.
Only question here is not one of arbitration, but one of waiver of appeal. The dissent suggests that one may not waive his right to appeal — which cannot be accepted as a sound legal principle. Waiver of appeal is accomplished every day, as is waiver of a jury trial, — both constitutional rights about which the dissent seems earnestly to be concerned. Accused persons frequently waive both such constitutional rights, which parallels those cases where
. Including the contract and several modifications.
. Where Horman was made a third-party defendant, and where claims against Hor-man were dismissed without prejudice.
. 16 Utah 2d 223, 398 P.2d 873 (1965).
. Bracken v. Dahle, 68 Utah 486, 489, 251 P. 16 (1926); Latter v. Holsum Bread Co., 108 Utah 364, 160 P.2d 421, 428 (1945); Hoste v. Dalton, 137 Mich. 522, 100 N.W. 750, 752 (1904); Brown v. Brown, 35 Ohio App. 182, 172 N.E. 416 (1930); United States Cons. Seeded Raisin Co. v. Chaddock, 173 F. 577 (9th Cir. 1909) cert. denied 215 U.S. 591, 30 S.Ct. 407, 54 L.Ed. 340 (1910); Harmina v. Shay, 101 N.J.Eq. 273, 137 A. 558 (1927); Phelps v. Blome, 150 Neb. 547, 35 N.W.2d 93 (1948).
. Lloyds point out that they filed a motion to dismiss in this court and that it was denied, apparently concluding that such denial was tantamount to an adjudication by us that the matter was appeal-able, which conclusion does not necessarily maintain, since frequently such motions are denied for a variety of reasons, not the least of which may be to preserve an issue for plenary treatment by brief and argument.
. 15 Utah 2d 422, 394 P.2d 77 (1964).
. 123 Utah 16, 253 P.2d 372 (3953).
Dissenting Opinion
(dissenting in part) :
I dissent from holding that the plaintiffs have no right to appeal, but otherwise concur in the opinion, including the striking of the award of attorney’s fees.
I confess that to me it presents a puzzling situation when parties seeking protection of their rights before this court make the contention that they have no right to be here; and even more so, when this court agrees with that contention, but nevertheless proceeds to grant relief, which it has done here to the extent of $6,000. It must, of course, be recognized that the parties may enter into an agreement which states that they will not ask a court to enforce it. The perplexing problem arises if a dispute occurs and one of the parties refuses to abide by that covenant. How then can it be enforced ?
The party relying upon the covenant must say to the other: “You have no right to ask the court for assistance, but I will ask its assistance to enforce against you this covenant which prevents you from seeking its protection.” The logical consequence of the foregoing is this proposition: Under our system of insuring the peaceful and orderly settling of disputes by the processes of law, the only way in the ultimate that any covenant whatsoever, including one not to seek assistance from a court, can be enforced against one unwilling to abide by it is by a court, and the power that stands behind it.
This applies with equal force to the right to an appeal to seek redress from an improper judgment, as it does to having access to the court in the first instance, as set forth in the case of Barnhart v. Civil Service Emp. Ins. Co.
It is almost the universal rule that in the absence of a statute to the contrary, an agreement to arbitrate all future disputes thereafter arising under the contract does not constitute a bar to an action on the contract involving such dispute, on the ground that it seeks to deny to the parties judicial remedies and therefore is contrary to public policy. [Citing a number of authorities.]
It is not to be doubted that after a judgment has been rendered by a court adjudicating the rights of the parties, so that each party knows what his rights and obligations are, they may then agree to abide thereby, and not to take an appeal. This is simply tantamount to settling the lawsuit at that point. If by mutual promises they agree to do so, they should be bound in the same manner as by any other contract; and if a party refused to abide, the matter could be taken to court for enforcement.
The real difficulty is confronted when, before the particular grievance has arisen, and the parties don’t even know what it is, or is going to be, the agreement states they will not seek redress therefrom in court.
The right and some viable means of seeking redress of grievances is essential to a free and orderly society, which the judicial branch of our government and its courts were established to implement. It is provided in Art. I, Sec. 11, of the Utah Constitution:
All courts shall be open, and every person, for an injury done to him in his person, property or reputation, shall have remedy by due course of law, which shall be administered without denial or unnecessary delay; and no person shall be barred from prosecvtting or defending before any tribunal in this State, by himself or counsel, any civil cause to which he is a party.
The right to appeal from a judgment which is imposed upon one which is ■ deemed to be oppressive, unjust, or for any reason improper as not in conformity with the law, is also expressly spelled out in our constitutional and statutory law. Art. VIII, Sec. 9, Utah Constitution, provides that:
From all final judgments of the district courts, there shall be a right of appeal to the Supreme Court.
Where parties have agreed to abide by a decision of a court before they even know what it is, or will be, it is certainly within the realm of possibility that a court might render a judgment so totally incongruous to their rights, or the remedy sought, that it would be intolerable to either, or both of them, for that matter. There surely should be some safety valve to correct such a situation and this would be the right of appeal.
The instant case provides a very good illustration of the soundness of the rule advocated in this dissent. Under our law attorney’s fees are never awarded except where provided for by statute or by contract.-
The problem under consideration can be brought into sharper focus by an exaggerated supposition. Suppose the trial court, instead of awarding a mere $6,000 attorney’s fee, had extended it another decimal point and made it $60,000, or another decimal point and had made it $600,000, or any further number of decimal points one would care to imagine, and the judgment could not be corrected on appeal. Or suppose the district court had, upon some other unjustified basis, rendered judgment for some amount which was unconscionable or ever so outrageous, and that it refused to correct the error. It seems inescapable to conclude that in the processes of justice there should be some way to correct such a judgment. That is the purpose of the right to appeal and demonstrates the reason why it should not be denied.
For the reasons above set forth: that the covenant not to appeal is inimical to the spirit and purpose of our system of justice and is contrary to clearly expressed fundamental law, it is my opinion that this court should refuse to enforce it as being as against public policy, and then award the appropriate relief by striking the $6,000 attorney’s fee, and otherwise affirming the judgment, as does the main opinion. This would avoid the paradox involved in say
(All emphasis mine.)
. Footnote 4 of main opinion.
. Footnote 4 of main opinion.
. See cases cited in footnotes 6 and 7 of main opinion.
Concurring in Part
(concurring in part and dissenting in part) :
I concur with the majority opinion upholding the right of the parties by agreement to waive their rights of appeal. It would seem to me that such agreement should be upheld on the grounds of public policy as encouraging litigants to accept the decisions of trial courts as being final.
. In addition to cases cited in the majority opinion, see also: Wyrakowski v. Budds, 325 Mich. 199, 38 N.W.2d 313; Speeth v. Fields, Ohio App., 47 Ohio L. Abst. 47, 71 N.E.2d 149.
Reference
- Full Case Name
- C. G. HORMAN CO., a Utah Corporation, Plaintiff and Appellant, v. Virgil J. LLOYD Et Ux., Defendants and Respondents
- Cited By
- 13 cases
- Status
- Published