Summary
In Lawton v. New York Life Ins. Co., 181 S.C. 230, 186 S.E. 909 (1936), the South Carolina Supreme Court cites with approval many cases holding that a suit on a note should include a claim for costs and attorney's fees provided for in the note and that a second suit for the costs and attorney's fees alone would be barred by res judicata.
Summary of this case from Boyer v. W.R. Grace Co., Inc.Opinion
14338
July 21, 1936.
Before RAMAGE, J., Barnwell, June, 1935. Affirmed.
Action by Brewton S. Lawton against New York Life Insurance Company. From an order sustaining defendant's demurrer and dismissing the complaint, plaintiff appeals.
The order of Judge Ramage follows:
The is an action to recover $700.00 as attorney's fees alleged to have been paid by plaintiff to his attorneys, in an action on a claim to recover disability benefits under a policy entered into by defendant.
Plaintiff brought this suit to recover $700.00 paid as a fee to his attorneys to bring suit and collect the money. The only thing in the complaint that at all "squints" towards a cause of action is the allegation, "and as a part of said contract further stipulated and contracted that it would not be necessary for the insured or the beneficiary to employ the agency of any person, firm or corporation in collecting the insurance under said policy, or receiving any of its benefits."
There are not many cases in our Courts bearing on the matter of attorney's fees. In the case of Butler v. Butler, 73 S.C. 402, 53 S.E., 646, our Court held that attorneys for plaintiff in partition are not entitled to fees of the common fund. Mr. Graydon in his argument cites a number of cases in his brief printed on page 402 of 73 S.C. 53 S.E., 646. In Westmoreland v. Martin, 24 S.C. 238, we find. "An attorney's right to fees must, in every case, rest on contract made with the party himself who is charged, or with his representative. No legal claim for compensation can be founded upon services incidentally benefiting a party, other than the employer." In Ex parte Lynch, 25 S.C. 193, we find in an action for breach of contract of general warranty, fees paid to an attorney by the covenantee for defending the title cannot be recovered as damages.
It seems that Hand v. Railroad Co., 21 S.C. 162, and Hubbard v. Camperdown Mills, 25 S.C. 496, 1 S.E., 5, really settled this case even if any claim had been set up in the original case for attorney's fees, as the general statement set out above could not be construed into an agreement to pay attorney's fees. But the real point in the case it seems to me is res adjudicata. The complaint in the case at bar is an effort to split a cause of action into two parts.
In the first place, if plaintiff was not suing on the entire cause of action in the first suit it does seem that both the Court in which the action was tried and the defendant both ought to have been advised, in the former case, that part of the claim, the sum of $700.00, was being reserved for another and separate action; good faith and the orderly administration of justice would seem to require this.
When an action is brought on an insurance policy, and nothing is said that would limit the case, one could assume that the whole matter is embraced in the suit. Not only what is decided in a case but what ought to have been decided will be deemed settled and ended.
"The rule against splitting is that a single cause of action, claim or demand cannot be split up or divided so as to be made the subject of different actions. If this is done and separate actions are brought for different parts of such a demand the pendency of the first may be pleaded in abatement of the others, and a judgment upon the merits in either will be available as a bar in the others." Corpus Juris, 1106, 1107, § 276.
"The object of the rule is to prevent repeated litigation between the same parties in regard to the same subject of controversy; to protect defendant from unnecessary vexation; and to avoid the costs and expenses incident to numerous suits." C.J., 1107, § 277. Section 278, which follows that just cited, says that it is a matter of public policy to prevent the hardship of unnecessary litigation; it does not mean that a plaintiff cannot sue for less than is his due, but if he does so, he cannot maintain another action for the remainder of the same demanded. The rule applies both to actions in "tort" and "contract," and in "law" cases is always recognized. In equity cases the rule is not so strictly enforced. A cause of action is a right on the part of the plaintiff and a violation of such right by defendant.
It is stated that "said attorney was forced to bring an action against the said defendant for the purpose of recovering the monthly benefits to which the plaintiff was entitled and did in said action recover of the defendant a judgment for said disability benefits."
It seems that plaintiff's cause of action in the former case was for $100.00 per month, and if he intended to claim anything further in the way of attorney's fees such claim ought to have been made in the suit to recover the claim of $100.00 per month, just the same as a suit for foreclosure of a mortgage with the addition of 10 per cent. attorney's fees. I apprehend if a party brings a suit to recover the face of the note and leaves out the claim for attorney's fees, he could not afterwards go back and sue for the 10 per cent. in another action. It has always been the general understanding of the bar that only one suit could be brought. Section 1, Corpus Juris, page 1115, § 285. I think the matter is fully covered by the case of Mitchell v. Federal Intermediate Credit Bank, 165 S.C. 457, 164 S.E., 136, 83 A.L.R., 629.
If the note stipulates for the payment of costs and attorney's fees, in case the note is not paid and suit is brought thereon, the claim for such costs and fees is not a separate cause of action and must be included in the action on the note. Defendant cited the following: 15 Ruling Case Law, 949; Cromwell v. Sac County, 94 U.S. 351, 24 L.Ed., 195; City of New Orleans v. Citizens' Bank, 167 U.S. 371, 17 S.Ct., 905, 42 L.Ed., 202; Southern Pacific R. Co. v. U.S., 168 U.S. 1, 18 S.Ct., 18, 42 L.Ed., 355; Baltimore S.S. Co. v. Phillips, 274 U.S. 316, 47 S.Ct., 600, 71 L.Ed., 1069; Werlein v. New Orleans, 177 U.S. 390, 398, 20 S.Ct., 682, 44 L.Ed., 817; Myers v. International Trust Co., 263 U.S. 64, 44 S.Ct., 86, 68 L.Ed., 165; U.S. v. Moser, 266 U.S. 236, 45 S.Ct., 66, 69 L.Ed., 262; Troxell v. Delaware, etc., 227 U.S. 434, 33 S.Ct., 274, 57 L.Ed., 586; Grubb v. Public Utilities Comm., 281 U.S. 470, 50 S.Ct., 374, 74 L.Ed., 972.
I do not think that mere statement that there would be no necessity "to employ the agency of any person, firm or corporation" is a contract to pay attorney's fees; either an expressed contract or implied contract for that purpose; but if it were, the claim ought to have been made in the former case.
It is further ordered and adjudged that the demurrer herein be, and the same is hereby, sustained, and the complaint dismissed.
Mr. Edgar A. Brown, for appellant, cites: As to payment of attorney's fee by unsuccessful party: 25 S.C. 193; 17 S.C. 35; 82 S.E., 399; 8 S.E., 898; 2 Brev. L., 108; 133 S.E., 699; 81 S.E., 313.
Messrs. Thomas, Lumpkin Cain, for respondent, cite: Payment of attorney's fees: 73 S.C. 402; 24 S.C. 238; 25 S.C. 193; 21 S.C. 162; 25 S.C. 496; 165 S.C. 457; 21 S.C. 162; 25 S.C. 501; 41 L.R.A. (N.S.), 1130; 114 S.E., 2; 158 N.C. 128; 73 S.E., 801; 13 Cyc., 79; 20 Cyc., 142; 4 Pac., 994; 88 Pac., 263; 41 Pac., 961; 8 A.S.R., 158. Exemplary damages: 4 L.R.A. (N.S.), 907; 28 L.R.A. (N.S.), 761; 87 Kan., 331; 124 Pac., 474; 41 L.R.A. (N.S.), 379; 116 S.C. 474; 165 S.E., 207; 77 S.C. 187; 57 S.E., 766; 101 S.C. 125; 85 S.C. 241; 70 S.C. 108; 49 S.E., 232; 3 Ann. Cas., 407. Res adjudicata: 15 C.L., 954; 17 S.C. 35; 164 S.E., 439; 178 N.W., 802; 23 Cyc., 1174; 96 S.C. 18; 79 S.E., 637; 160 S.C. 557; 159 S.E., 386; 87 S.E., 127; 69 S.E., 85; 110 S.C. 534; 95 S.E., 532; 9 S.C. 281; 44 S.C. 1.
July 21, 1936. The opinion of the Court was delivered by
The order of Judge Ramage, sustaining the demurrer to the complaint, from which order the appeal comes to this Court, correctly states the law governing the case, and is satisfactory to this Court.
The order appealed from is affirmed. Let it be reported.
MR. CHIEF JUSTICE STABLER and MESSRS. JUSTICES BAKER and FISHBURNE concur.
MR. JUSTICE CARTER did not participate.