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Complaint. Fulton Superior Court. Before Judge Alverson.
HALL, Judge.
A petition of one counsel has against his co-counsel and their clients, showing that the defendants conspired to deprive plaintiff of his compensation and of his right to excercise his attorney's retaining or holding lien in funds in the hands of defendants; that to collect said funds and get them in defendants' possession exclusive of plaintiff the defendants executed a release containing the false statement that a plaintiff's compensation had been paid; and that co-counsel released the funds to the clients to plaintiff's injury, is not subject to the defendants' general demurrers.
The plaintiff (defendant in error) filed a petition against the defendants (plaintiffs in error) alleging the following facts: The defendants Davidson (hereinafter called the partners) were members of a partnership known as Stone Mountain Grit Co. Said partnership had filed a suit in DeKalb Superior Court against Consolidated Quarries Corp., which was tried and resulted in a verdict for the defendant. The attorney who filed the suit, Robert P. McLarty, having retired, the partners through the defendant Simon employed the plaintiff, and attorney, the perfect a motion for new trial and if necessary to appeal the case and handle the new trial if granted. Plaintiff's compensation for services in connection with the appeal was to be at an hourly rate, and plaintiff and the defendant Simon, also an attorney, were to receive a contingent fee in the event of any recovery in said case by the partnership. Plaintiff and the defendant Simons prepared an appeal from the denial of the motion for new trial, and this court granted a new trial. Plaintiff was paid for his services in connection with the appeal as agreed. Thereafter during negotiations for settlement of the suit against Consolidated Quarries Corp., the partners proposed to pay plaintiff and Simons, instead of the contingent fee, $20,000 as their remaining fee for services in the case. The defendant Simons on behalf of the partners submitted this proposal to the plaintiff. The plaintiff accepted the proposal on the condition that the check made in settlement of the case be made payable jointly to the partnership and the plaintiff and Simons as its attorneys, and that the proposed fee be paid out of the proceeds of settlement jointly to plaintiff and Simons. The defendant Simons, in his own behalf and in behalf of the partners, agreed to these conditions. The parties also agreed that the fee would be divided equally between the plaintiff and Simons.
The defendants executed and caused to be delivered to Consolidated Quarries Corp. a written release containing the statement, false and known to the defendants to be false, that plaintiff's compensation for services in said case had been fully paid. The defendant Simons, without the knowledge of authority of petitioner, signed plaintiff's name to this release. The defendant Simons, acting upon direction of and in behalf of the partners, caused Consolidated Quarries Corp. to prepare and sign a check for $47,500 (the agreed cash settlement) naming the partners, Robert P. McLarty, and himself as payees, and omitting plaintiff's name as a payee, and required said check and a deed (also a part of the agreed settlement) to be delivered to him, in exchange for the release containing said false statement.
The defendant Simons procured Robert P. McLarty's indorsement on said check, himself indorsed the check, delivered it to the partners, and the partnership cashed and received the proceeds of the check. All the defendants' acts with respect to the check were without plaintiff's knowledge or consent. The defendants have not paid plaintiff and refuse to pay plaintiff any part of his agreed compensation.
The plaintiff alleges that the defendants' acts in executing and delivering the release, and procuring the check without plaintiff's name thereon as payee to protect his lien thereon, were a scheme and conspiracy to cheat and defraud him out of the compensation due him for his services and to defeat his lien for his compensation upon the proceeds of settlement; that by said conspiracy and scheme they did defeat and destroy the effectiveness of said lien and deprive plaintiff of his right to exercise the lien by holding the proceeds of settlement until he was paid his compensation for services; that the defendants' conduct and the aforesaid results thereof constituted a wilful and deliberate tort, by which plaintiff has lost and been deprived of his compensation secured by the lien, $10,000, in which sum he lays his damages.
The partners and the defendant Simons both filed general demurrers and a special demurrer on the ground that the petition "sounds in both tort and contract, and these defendants call upon plaintiff to elect whether he is proceeding in tort or in contract." The court overruled all the demurrers, and on these judgments the defendants assign error. (The defendant Simons filed an additional special demurrer which the court overruled; but he does not argue the assignment of error on this ground, and we shall treat it as abandoned.)
The gist of this action is the injury to the plaintiff's right to hold the proceeds of settlement of the suit until he was paid his compensation as attorney, caused by the alleged deliberate wrongful acts of the defendants, by reason of which his lost the compensation due him. Plaintiff's right allegedly infringed arose out of a statute, Code 1933, 9-613: "1. Attorneys at law shall have a lien on all papers and money of thier clients in thier possession, for services rendered to them, and may retain said papers until such claims are satisfied, and may apply such money to the satisfaction of said claims."
An attorney's retaining or "holding" lien (codified in Code 9-613) existed at common law and was founded and depended on possesion of something to which the lien could attach. 7 C.J.S. 1141, 210, 5 Am. Jur. 388, 209 et seq. It is security for a debt. McDonald, Bailey & Powers v. Napier, 14 Ga. 89, 111.
Plaintiff's statutory right was recognized and amplified by agreement between the parties. The defendants agreed that the settlement check would be made payable jointly to the partnership and the plaintiff and Simons as its attorneys, and that the attorneys' fee would be paid out of proceeds of settlement jointly to plaintiff and Simons, to be divided equally between them.
An action for damages by one counsel will lie against his co-counsel for failure to protect his retaining or holding lien in funds in the hands of the defendant after notice of the lien claim has been given. When the defendant co-counsel releases the funds to the client to the plaintiff's detriment, it follows that plaintiff is entitled to such damages as will make him whole. Jones v. Miller, 203 F.2d 131 (3d Cir.), 134, 135, Cert. denied 346 U.S. 821. The following cases are in accord in principle: Miller v. Wilson, 98 Ga. 567 (25 SE 578, 58 ASR 319); Anderson v. B. T. Adams & Co., 117 Ga. 919 (43 SE 982); Blanchard v. Farmers State Bank, 158 Ga. 780 (124 SE 695).
A conspiracy is a combination of two or more persons for the purpose of doing something unlawful, oppressive, or immoral, either to accomplish an unlawful end, or to accomplish a lawful end by unlawful means. Woodruff v. Hughes, 2 Ga. App. 361 (58 SE 551); Luke v. Dupree, 158 Ga. 590, 596 (124 SE 13). When the unlawful means or end is accomplished by a conspiracy, the person injured has an action against the conspirators for any damage he may sustain. The gist of the action is not the conspiracty alleged, but the tort committed against the plaintiff and the damage thereby done. Woodruff v. Hughes, supra. "The liability of each and every tortfeasor is several, though the tortious act was one in which all may have participated, and although the injured party may recover against one only slightly concerned in the wrongful act for the greatest injury which may have been inflicted by the most guilty of the tortfeasors. . . It matters not even if one of the joint conspirators or joint tortfeasors gets nothing from the transaction." Wall v. Wall, 176 Ga. 757, 759, 761 (168 SE 893); McCranie v. Bank of Willacoochee, 29 Ga. App. 552 (116 SE 202).
"The elements of a conspiracy are: (a) The confederating-- the combining together of two or more persons. (b) The intent-- for the purpose. (c) The object-- of doing something unlawful or oppressive, or immoral, as a means or an end." Woodruff v. Hughes, 2 Ga. App. 361, 363, supra. "The essential element . . . [of a conspiracy] is the common design. . . It is sufficient that two or more persons in any manner either positively or tacitly come to a mutual understanding that they will accomplish the unlawful design." Woodruff v. Hughes, supra, p. 365. The petition in this case sufficiently alleges that the defendants combined with the intent to deprive petitioner of his compensation and his right to exercise his holding lien. Was the object of the alleged conspiracy either in the means used or in the end sought to be obtained, unlawful, oppressive, or immoral? It was--both in the means used and the end sought. "When the law requires one to do an act for the benefit of another, or the forbear the doing of that which may injure another, though no action be given in express terms, upon the accrual of damage the injured party may recover." Georgia Code of 1933, 105-103. A petition showing false statements made by a defendant to another, which brings about damage to the plaintiff, sets forth a cause of action for tort. Muse v. Connell, 62 Ga. App. 296, 303 (8 SE2d 100).
The defendant contends that the plaintiff's attorney's lien was not destroyed, and cites as authority cases holding that an attorney's charging lien (paragraph 2 of Code 9-613), is not defeated by the settlement of a case without the attorney's participation. We agree wish this contention as to an attorney's charging lien; however, the injury here is to plaintiff's right to exercise his retaining or "holding" lien.
Accordingly, the court did not err in overruling the general demurrers.
The special demurrers also are without merit. The petition did allege an agreement between the parties. The petition would have stated a good cause of action even in the absence of any specific agreement as to the amount of the attorney's compensation. And although it is not necessary so to decide, we do not think the petition would have been defective without allegations showing the defendants specifically recognized and agreed to protect plaintiff's right to exercise his holding lien. The allegations of the terms of the agreement were pertinent, however, to support the amount plaintiff claims as damages, and to show the defendants' knowledge of and hence their wilfulness in violating plaintiff's right.
"A tort may result from the violation of a duty which is itself the consequence of a contract . . . liability arises out of a breach of duty incident to and created by the contract, but is only dependent upon the contract to the extent necessary to raise the duty. The tort consists in the breach of duty." Wall v. Wall, 176 Ga. 757, 763, supra; City & Suburban Ry. of Savannah v. Brauss, 70 Ga. 368; Tapley v. Youmans, 95 Ga. App. 161, 175 (97 SE2d 365); Code 105-104.
The allegations of the terms of the agreement and its breach, therefore, do not make this a contract action. Central of Ga. Ry. Co. v. Chicago Portrait Co., 122 Ga. 11, 12 (49 SE 727, 106 ASR 87); McCranie v. Bank of Willacoochee, 29 Ga. App. 552, supra.
The court did not err in overruling defendants' special demurrers.
Calhoun & Calhoun, Clarence H. Calhoun, Jr., contra.
Lewis, Lewis, Whaley & Cagle, Robert W. Cagle, Lindsay, Simons & Hayes, for plaintiffs in error.
Friday May 22 23:25 EDT

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