Hovey v. Rubber Tip Pencil Co. — 35 N.Y. Super. Ct. 81

Majority

p. 81

SAMUEL D. HOVEY, et al., Plaintiffs and Respondents, v. THE RUBBER TIP PENCIL COMPANY, Defendant and Appellant.

Headnote

Reasonable counsel fees and expenses and disbursements made or incurred, in obtaining a final decision that plaintiff was not entitled to an injunction that he had obtained in an action, are proper items of damage to be allowed to the defendant, because of the issue of said injunction.

p. 82

But it does not follow that the counsel fees, costs, and expenses paid out by the defendant, during the whole litigation including the trial, were paid in obtaining a decision that plaintiff was not entitled to the injunction, especially in view of the fact that plaintiff sought a recovery of damages, and other relief in the action, as well as an injunction, etc.

A referee who is appointed to ascertain and report damages in such case, ■ must coniine himself to those costs and expenses actually incurred in the dissolution of the injunction, or in obtaining the final decision that plaintiff was not entitled to the same. If he includes all the costs, counsel fees, and expenses in the action, without distinction, it is error.

Before Curtis and Sedgwick, JJ.

Decided June 29, 1872.

Appeal from order denying motion to confirm the report of the referee appointed to ascertain damages sustained by defendant by reason of the injunction.

At the commencement of the suit, an ex parte injunction was granted upon an undertaking pursuant to section 222 of the Code, that the plaintiffs would pay to the defendant “such damages” . . .' “as it may sustain “by reason of the said injunction, if this court should “finally decide that the said plaintiffs were not entitled “ thereto,” not exceeding five hundred dollars.

This injunction remained in force until the trial of the action before Mr. Justice Jones, when judgment was recovered by the defendant dismissing the complaint, from which no appeal has been taken.

An order was subsequently made, appointing a referee to ascertain the damages sustained by defendant by reason of the injunction, who, after hearing proofs, reported “that said defendant is entitled to recover upon “said undertaking, the sum of five hundred dollars “ ($500) as damages sustained by reason of said injunction,” which damages consisted of counsel fees, incurred and expended by defendant, in obtaining a dismissal of the complaint, and which was reasonable in amount.

p. 83

The report was filed, and a motion to confirm it heard before Mr. Justice Jones, and December 30,1871, an order was made by him, denying the motion ; from which order this appeal is taken.

John 8. Washburn, for appellant.

Ambrose Monell, for respondents.

The complaint in this action, in addition to seeking relief by an injunction, also sets up that the plaintiffs have been injured by the defendant’s acts, and sustained damages to the extent of five thousand dollars, and demands judgment against the defendant to that amount.

It is clear that counsel fees are to be allowed when they have been incurred in a successful motion to dissolve the injunction (Coates v. Coates, 1 Duer, 664 ).

It also appears that reasonable counsel fees, and expenses paid in obtaining a final decision that the plaintiff was not entitled to the injunction, are proper items of damage to be allowed.

The question for consideration is, whether the counsel fees and costs paid by the defendant during the litigation, including the trial, and which were allowed by the referee, as damages by reason of the injunction, were paid in obtaining a decision that the plaintiff was not entitled to the injunction.

The pleadings and the evidence do not satisfactorily show that such payments were made in obtaining a dissolution of the injunction. The claim for damages made by the plaintiff, was an element in the case, and which, irrespective of the demand for an injunction, had to be met and prepared for. The pleadings in this suit, and the defence of it, so far as it appears in the present proceeding, involved other issues and controversies, than what related simply to the relief sought by way of in

p. 84

junction, and it is apparent that it was defended for other reasons than simply to procure a dissolution of the injunction order. The sums paid as counsel fees by the defendant were not incurred in obtaining a dissolution of the injunction, but in the general defence of the suit. This does not bring them within the rule established in Coates v. Coates, 1 Duer, 664 .

. The referee does not find what the services of counsel, if any, in dissolving the injunction were worth, or what sums, if any, were paid for such services ; nor does he find that any fees were paid them, as distinguished from the general fees paid them for services in the general defence of the suit. Neither the referee, nor the court, have the evidence before them, that enables them to decide what was actually paid by the defendant for services to obtain a dissolution of the injunction ; and unless this does appear clearly, it seems to be settled that the defendant cannot sustain a claim to be allowed this as damages (Strong v. DeForest, 15 Abb. 427 ; Town of Guilford v. Cornell, 4 Abb. 220 ; Child v. Lyons, 3 Robts. 704; Wilde v. Joel, 15 How. P. 320; Edwards v. Bodine, 11 Paige, 223).

A departure from that rule might in some cases affect plaintiffs oppressively.

There is no reason to think that it was the intention of the legislature, that an unsuccessful plaintiff, because he has as one branch of his relief asked for an injunction, should in addition to the payment to the defendant of the costs and allowances provided by the Code, be mulcted in all the counsel fees paid in the general defence of the suit.

I concur in the views of the learned judge who made the order appealed from, and which should be affirmed with costs to the plaintiff.