Williams v. Philadelphia , 208 Pa. 282 ( 1904 )

Opinion by

Mr. Chief Justice Mitchell,

The substantial controversy in this case, briefly stated is this: plaintiff being possessed of information that the city had made overpayments in its settlements with the state for taxes, offered to procure credit for such overpayments ; the mayor under authority of an ordinance accepted the offer and made a contract with plaintiff for a contingent fee of ten per cent; one settlement was opened by plaintiff’s efforts, the city received a credit of about $30,000 on which plaintiff was paid his ten per cent fee; plaintiff was then proceeding to open other settlements witli the state when the city, believing that the result would be to its disadvantage, refused to go on and prevented plaintiff from further proceedings in its behalf. Plaintiff then brought this suit for the breach of contract.

The right of the city as a client to abandon a suit at any time when satisfied of its interest to do so, is not questioned in this case. But its obligation to plaintiff as its attorney is a different matter. That depends on the contract.

The contract here was all in print or in writing, and there is no room for question as to its terms. By resolution of councils of September 29, 1892, the mayor and city solicitor were “ authorized to employ assistant counsel for the city of Philadelphia, to prosecute the claim of the city for a credit or credits with the commonwealth for taxes on loans, heretofore paid by the city treasurer, and for taxes on personal property heretofore paid by the city; ” and under resolution of October 27, 1892, the compensation of such assistant was fixed at “ ten per cent of the amount collected or recovered.” Plaintiff was duly appointed under these resolutions. He had therefore an interest in the contract apart from his mere employment as an attorney, and of this he could not be deprived by the city’s change of view as to the advisability of further prosecuting its claims.

It is urged, and that is perhaps the main stress of the argument here, that the contract is champertous and should not be enforced by the courts. But the facts do not sustain this view. Contingent fees are not illegal. They enable some just claims to be recovered which the circumstances of the parties would otherwise defeat, while on the other hand they certainly tend to encourage litigation of a speculative and unfounded character, which is against the true interests of society. But, wisely or unwisely, a point on which opinions may fairly differ, the law has long been settled that contracts for such fees are lawful and enforceable by the courts, and something more than the mere contingency of the compensation is necessary to make them champertous. What the plaintiff undertook to do here was not to furnish testimony as a witness, or to do any other act of improper or even doubtful tendency, but to use certain information already accessible to those who looked for it, in a way that his superior knowledge or superior professional skill would make available for his client’s benefit. As it was clearly stated by the learned judge to the jury, “ the fact was perfectly public. It was not a private fact. It was a fact known to the commonwealth and known to the municipality .... and therefore there was really no secret whatever about it. But .... though the fact was known, the attention of the city solicitor had never been directed to it, and the attention of the city treasurer had not been sufficiently directed to it to raise a question apparently, and what Mr. Williams did do was to point out that a matter well worthy of attention had not been attended to.” This had no essential element of champerty.

The next question is of performance by the plaintiff, or what was legally equivalent thereto, and of breach by the city. What the plaintiff undertook to do by his contract was to obtain credit for the city for previous overpayments. It appears to be conceded that the state, even in cases of admitted overpayment, does not return the money but gives a credit of the amount on the account at the next settlement. Accordingly the ordinance and the plaintiff’s appointment specify his undertaking as the prosecution of- “ the claim of the city for a credit, or credits, with the commonwealth for taxes on loans,” etc., and the compensation fixed “at ten per cent of the amount collected or recovered” must be understood in its connection as meaning ten per cent of the credit secured. Plaintiff showed the recovery of a credit for about $30,000, as already noted, and gave evidence tending to show that he could have secured a further credit of $84,000, but was prevented by the action of the city. Tins action, which constitutes the breach complained of, consisted of the refusal of the mayor to sign, on behalf of the city, a statement of the claim to be presented to the state board of accounts, and the subsequent refusal' of the city officers and agents to furnish the lists or registers of the bonds and bondholders requisite to enable plaintiff to establish the main fact of payment of taxes on bonds which were exempt or on which the taxes had already been paid by the corporations owning them. It is argued for the city that it was not bound to give any active assistance, as plaintiff had undertaken to do the whole himself. Points were presented for charge that: “ 5. By this agreement with the city, the plaintiff was required to furnish the information and to make the collections from the state without the active assistance of the city or of any of its officers, and if the plaintiff’s failure to make the collection was due to the refusal of the city’s officers to aid him by furnishing information necessary to success, your verdict must be for the city, defendant.” And 6. “ The defendant was not obliged, under the terms of the agreement with the plaintiff, to furnish information with which to prosecute the services undertaken by him. If you find, therefore, that it was impossible for the plaintiff to proceed to a successful determination of the matter without assistance from the city, he is not entitled to recover, and your verdict must be for the defendant.” These points the learned judge properly refused. There is nothing in the contract or the circumstances of its making to take it out of the general rule, which is that the party to be benefited, in this-case the client, impliedly agrees to render reasonable assistance to the effort in his behalf. The refusal to sign the claim for presentation to the board of accounts was in effect refusing to furnish the plaintiff with a letter of attorney to act for the city in the matter he had undertaken, -and the schedules.of bonds were a proper part of the evidence in the case which was within the custody and control of the city. The plaintiff did not contract to prosecute a suit against the obstruction of an unwilling client, but was entitled to rely on the implied condition not only of willingness, but of reasonable assistance. This branch of the defense, however, is manifestly an afterthought. The signature and the schedules were not refused because the city did not consider itself obliged to furnish them, but because it had determined that it did not desire the claim prosecuted, and intended to prevent the plaintiff from doing so. This, as already said, it had tbe right to do, but it could not thereby escape its obligations to the plaintiff. The evidence of the breach of the contract was properly received and properly submitted to the jury.

The remaining question has reference to the damages. The plaintiff testified that he would have obtained a further credit of §84,000, while Mr. Catharine, the assistant city solicitor, testified that in his opinion, the largest credit that could have been obtained would have been §38,000, and that this would have been more than offset by new debits in the restated account. These opinions were received as those of experts. The accounts in question had been settled and closed, and the time for appeal had gone by. The only chance for opening and restatement was in the discretion of the state board of accounts, which had not been exercised. It was therefore as the judge told the jury impossible to procure evidence of an absolutely certain character as to what would have been the result of plaintiff’s efforts, and in such cases the law allowed the best substitute which was attainable. In this there was no error. Where the contract is to perform something in the future, the successful result of which is therefore necessarily uncertain, and performance is wrongfully prevented by the other party, a speculative element is unavoidably introduced into the question of damages, but cannot take away the right to just compensation. In such cases, all that can be reasonably required of a plaintiff is to produce to the jury sufficient evidence, of the best character attainable, of a fair prospect of success, and the compensation which would have followed. This the court left to the jury in the present case, stating the evidence as fairly and as strongly for the defendant as for the plaintiff. The evidence, he said, “ being before you, you must find out what was the reasonable probability of recovery. If the reasonable probability was, as Mr. Williams says, that he should recover $84,000, which was only prevented by the interference of the mayor of the city of Philadelphia in refusing to sign the statement, and the consequent refusal of the assistants of the city to give requisite and necessary information, then he is entitled to recover $8,400 with interest from the time when it was due and payable. If you find on the other hand that Mr. Catharine’s estimate is correct as to the amount, then he is entitled to recover $3,300, with interest from that time. But if you find that Mr. Catharine’s further judgment that on a full restatement of the account the debits that would have been properly chargeable to the city of Philadelphia would have consumed and eaten up the $33,000, is correct, then the plaintiff is not entitled to recover at all.” He then further charged the jury that if the evidence as to the probable success of the plaintiff had he been permitted to prosecute the claim was so based on conjecture and speculation that it did not afford sufficient certainty to the jury’s mind to reach a conclusion, then they should resort to the value of the services actually rendered, without regard to the contingent fee. The city certainly had nothing to complain of in this instruction.

In the course of the charge the learned judge commented on the duty of the city to pay its debts and the propriety of going into a partnership with an individual about its claim by a contract in such form that it was to win whatever the result, which he characterized as “ small business.” These comments are assigned for error, but we do not find that the learned judge in any way exceeded his privilege in placing the case properly before the jury.

Appellant moved to suppress the appellee’s paper-book for scandalous and impertinent matter, reflecting on appellant’s counsel. The paper-book shows that the appellee’s counsel has allowed himself to make insinuations not only professional but personal, which are wholly without justification by anything in the evidence or the case, but they are so manifestly the outcome of temper that we think it sufficient to order all such matter expunged from the record.

Judgment affirmed.