Whitney v. Cooper — 1 Hill & Den. 629

Majority

p. 629

Whitney vs. Cooper.

Headnote

A person bringing an action in the name of another is liable under 2 R. S. 515, § 47, 2d ed. for the costs recovered against the nominal plaintiff, though his interest in the demand prosecuted is only by way of mortgage or lien.

The person thus sought to be charged may show by parol the real, nature of his interest, in contradiction of the terms of a, written assignment to him, absolute on its face.

No third person can be subjected to costs under the above statute, whatever may be the nature of his interest, and however much he may have interfered in the action, if, in truth, he is not chargeable with having brought it.

One may be said to have brought the action, within the meaning of the statute, who has retained the attorney for that purpose, either individually or in conjunction with others, or sanctioned the act of an assumed agent in retaining him, or agreed to indemnify the nominal plaintiff for the expenses consequent upon the retainer.

R. J. Hilton, for the defendant,

moved for a rule that Jacob Berringer pay the defendant his costs which he had recovered against the plaintiff in this cause by the judgment of this court. He read affidavits showing that the demand for which this suit was brought had been, assigned to Berringer, and nominally to Barent P. Staats jointly with Berringer before this suit was brought; and that Berringer had, according to his admissions, participated in its prosecution for his own benefit. The assignment was absolute in its terms, signed and sealed by Whitney, and attested by one Thayer, as a subscribing witness. The attorney for the plaintiff had, soon after the assignment was

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executed, served the defendant with a notice of it; adding, that Staats and Berringer were the sole owners.

It appeared that Staats’ name was inserted as assignee without his consent or knowledge, at the instance of James Gourlay, the latter intending that. Staats should take as trustee for him, (Gourlay,) to whom Whitney was indebted. But Staats declined to accept or act under the assignment.

. The claim of Whitney, the plaintiff, against the defendant, was $715, and was believed to be sufficient to pay what he owed both Gourlay and Berringer; perhaps more. The claim of the latter against Whitney was only $120. Gourlay’s was from $300 to $500. The cause was heard before referees, Berringer having been present some part of the time; and the defendant obtained a report in his favor, recovered his general costs, they being taxed at $262.

Whitney stated in an affidavit made in behalf of the defendant, that Berringer and Gourlay ordered the suit to be commenced, and had given directions as to conducting it. . The assignment had been left with the plaintiff’s attorney.

N. Hillx jr., contra,

read an affidavit of Whitney, made in behalf of Berringer, not contradicting but professing to explain, in some respects, the affidavit he (Whitney) had made on the other side; and stating that that affidavit had been pressed upon him by the defendant’s attorney, without giving him due time to take advice on the subject. He now stated, that the only advance Berringer had, to his knowledge, made for carrying on the suit, was a loan to him of $17. He added, that the assignment was not accepted by Berringer in payment of his demand, nor did he advance any thing as a consideration beyond his debt.

An affidavit of Berringer himself was also read, denying' that he had retained the plaintiff’s attorney, or directed this suit to be prosecuted; and also denying that he had 'ever participated in its prosecution. He stated, that the assignment had been drawn up by the plaintiff’s; attorney

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under directions from him (Berringer) so to frame it as to give him a lien on the moneys to be recovered, to the extent of his claim which was only $120. And he supposed it had been so drawn, and not as conveying an absolute interest. He explained and limited his alleged participation in the suit and his advance of money, to mere inquiry as to the progress of the suit, and on one occasion lending $17 to the plaintiff in order to defray an occasional expense. He denied that he attended the reference, except on one or two occasions, when he was there as a spectator merely.

The affidavit of one Kingsley was also produced, showing that Whitney acted in retaining the attorney and bore a principal part in conducting the suit; also tending to confirm Berringer’s statement that he was present at the reference merely as a spectator.

To take from the force of Berringer’s admissions, on which much of the defendant’s proof tending to connect him with the suit, depended, and also to account for the form in which the assignment was drawn, a deposition was produced showing that he was a German, and spoke and understood the English language quite imperfectly.

Looking through the evidence, I am inclined, on the whole, to give the transaction in regard to the assignment about the same legal effect as Berringer claims for it in his affidavit. Staats, who was made the nominal assignee for the benefit of Gourlay, absolutely refused to ‘accept the assignment; and I do not see how any interest passed beyond what Berringer took under it. for the purpose of securing his $120. It is true, the assignment was absolute on its face; but Berringer says it was not intended with regard to him, as any thing more than the creation of a lien to secure his claim. The demand of the -plaintiff against Cooper was considered a large one;. and the assignment as to Gourlay utterly failing of any effect by the refusal of Staats, it would have been

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inequitable, had the whole claim been recovered, to say that Berringer should have taken the whole. The assignment certainly could not have been understood, as between Berringer and Gourlay, to mean what it imports on its face—the absolute conveyance of the whole claim against Cooper in equal moieties to them, while their demands against the plaintiff were so very unequal. It must, as between them, have been intended to apportion the avails according to the amount of their respective claims. It was doubtless also intended that any amount over and above both, should be refunded to the plaintiff; and as it turned out that the assignment for Gourlay’s benefit was frustrated, it cannot, with any color of propriety, be considered as in effect creating any thing more than a mere lien for Berringer’s benefit, he to hold the balance over and above his claim as a trustee for the plaintiff. The assignment, although absolute and under seal, may yet be shown by parol to have been a mere mortgage or collateral security. This has often been holden in respect to a deed conveying lands and choses in possession ; and in Miller v. Franklin, (20 Wendell, 630,) the same thing in principle was allowed in respect to an absolute assignment of a chose in action.

The assignment thus enuring as a mere lien in the hands of Berringer, and taking it that he brought the suit, is he liable to pay the defendant’s costs? The statute makes not only the simple assignee liable, (and vid. Norton v. Rich, 20 John. R. 475, Schoolcraft v. Lathrop, 5 Cowen, 17,) but “ any person beneficially interested in the recovery in such action.” (2 R. S. 515, 2d ed. § 47.) These terms, I am of opinion, extend to every person who holds an interest by way of mortgage or lien in the chose in action. A person may be so liable in consequence of being beneficially interested as a cestui que trust, without being either a partial or total assignee; (Colvard v. Oliver, 7 Wend. 497 ;) and the' clause cited from the statute might be satisfied by stopping there. The ordinary import of the words, however, I think takes in every such vested interest as the courts of law will protect against the interference of

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the nominal party. And it has long been settled that they will so protect a mere lien. (Martin v. Hawks, 15 John. R. 405.) I do not perceive any thing in Miller v. Frank lin,, which is incompatible with such a construction. The allowing of assignees to go free, because the general interest may not be in them, would enable them so to frame the contract of assignment as to evade liability for costs; while, i by prosecuting and maintaining the suit, they can acquire all the substantial benefit of an absolute assignment.

Thus there is no material difference between the effect- of Berringer’s interest, whether we take it as he would have it, or as the defendant seeks to infer it from his affidavits.

Then, did Berringer bring this suit, within the meaning of •the statute? The bringing of a suit, may be by retaining an attorney for the purpose, either alone or in conjunction with others, or recognizing a retainer made by an assumed agent, or actually engaging to defray the expenses of the nominal plaintiff retaining an attorney in his own name,he alone being liable to the attorney in the first instance. But in the attempt thus to identify Berringer with this suit, the affidavits on the side of the defendant are far from being distinct, not excepting that of Whitney. The amount of one affidavit (Dr. Staats’) is, that Berringer being, urged to discontinue the suit, persisted in carrying it on, and in. proceeding therewith. Another, (Gourlay’s,) that Berringer accepted the assignment, and admitted that he had advanced money to carry on the suit, and he was present at the hearing before the referees. Mr. Hilton deposes also that* Berringer was present before the referees, and appeared to take an active part in the prosecution.

What acts took place; or what declarations were made, which amounted in Dr. Staats’ mind to a persisting in and carrying on of the suit? I lay nut of view any general declarations by Berringer that he was assignee, and that the suit was brought for his and Gourlay’s benefit; for they do not exclude the agency of Whitney as the real party, nor are they incompatible with Berringer’s being a mere

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anxious inquirer into the prospects of the prosecution, on account of his lien. Indeed, the proof adduced by the defendant is throughout very general, not to say equivocal; while on the other hand, it is positively denied by Berringer that he took any part in carrying on the suit, except in the loan to Whitney of the §17, to pay costs. Ke denies that he was present at the reference, except for a part of the time, and then merely as a spectator. That portion of his acts and general declarations ■.which are spoken to the most strongly, is not only put forward in general terms, but is spoken to by witnesses who themselves stand prima facie liable for the costs ; and so, interested to bring in Berringer to the relief of themselves, while the imperfect manner in which he speaks English detracts still more from the force of such evidence.'

Whitnéy, the plaintiff, is unable to say any thing more than that Berringer ordered the suit to be brought, and gave directions. That he retained the attorney, the plaintiff does not say; and he also is interested in bringing the costs upon Berringer. The plaintiff is insolvent, but if Berringer can be fixed, it will at least save the plaintiff much trouble, and probably be equal to his entire discharge. Berringer himself denies that he retained the attorney, of ever did any act which can amount to a bringing of a suit within the meaning of the statute. What words the plaintiff considers an order to bring the suit, or to whom they were addressed; whether they might not have .been a mere request to the plaintiff that he would bring the suit at his own expense, he does not say, Berringer testifies that * the plaintiff was the man who retained the attorney and conducted the suit. -

By the affidavit of Kingsley, it appears that the plaintiff was himself the active man; that he retained the attorney, and was decidedly busy throughout in conducting the suit. Kingsley also confirms Berringer, that his presence at the reference was rather as a spectator than a party. The plaintiff admitted to Kingsley that the money advanced by Berringer was to pay the costs of adjourning the reference at the plaintiff’s instance.

p. 635

That a person having a lien for his debt on a chose in action, occasionally inquires as to its progress of the attorney who holds it for prosecution, admits himsélf to be interested, and advises and urges the suit, are not of themselves enough to charge him with the defendant’s costs.

■ On the whole, it is not to be denied that the defendant had much color for making this application; but he has not established ’that clear and satisfactory case upon which I feel warranted in charging Berringer, against his absolute denial of all liability, and the circumstances by which his denial is fortified.

Motion denied, without costs.

Cases cited

Colvard v. Oliver 7 Wend. 497 N.Y. Sup. Ct. 1832-02-23 p. 632