Sec 425

Partners jointly interested in a suit may bind themselves to divide the expenses of litigation, although their rights and interests are several;2 and this applies whenever there is an honest belief in a common interest,3 and where the relation between the parties is that of principal and agent, or master and servant.4 sec 426. For several reasons an attorney is precluded from purchasing his client's claim when in litigation: 1. If in ordinary cases purchases of litigated claims are invalid when for speculative objects, this limitation should be applied with peculiar rigor to a class of agents who,as with attorneys, have their special business in the management of litigation. 2. An attorney is his client's confidential adviser, and a sale to him is invalid on the ground that all sales to confidential advisers are invalid.5 3. An attorney is an officer of the court, and the dignity and just influence of the office would be destroyed if he is to have a contingent personal interest in the result of the litigation in which he is engaged. Hence, as a rule, a purchase by an attorney of a claim he is litigating on behalf of his client is against the policy of the law, and he will not be permitted to avail himself of such a purchase unless it should appear that the sale was fair, was not in any way under restraint, and was made under independent advice.6 But an assignment by the Parties jointly interested may bind themselves to expenses of litigation Attorney cannot purchase client's interest.

1 It was held, "as long ago as 21 Ed. III., that a purchase of property pending a suit affecting the title to it is not of itself champerty." Pollock, 3d ed. 317, citing 2 Ro. Ab. 113 B.

2 Findon v. Parker, 11 M. & W. 675; Call v. Calef, 13 Met. 362; and cases cited Wald's Pollock, 303; Wellington v. Kelly, 84 N. Y. 543.

3 Williamson v. Henley, 6 Bing. 299; Vaughan v. Marable, 64 Ala. 60.

4 Elborough v. Ayres, L. R. 10 Eq. 367.

5 Supra, sec 378. See on this topic 14 Cent. L. J. 168; and see Rogers v. Mining Co., 9 Fed. Rep. 721.

6 Supra, sec 161; Wh. on Agency, sec 574; Hall v. Hallett, 1 Cox, 134; Wood client to his lawyer by way of compensation for services rendered will be sustained,1 provided there be no undue influence exercised.2.

Sec 427

It is a moot question how far an agreement between counsel and client for a contingent fee to the counsel will be sustained.3 The following distinctions, however, may be suggested: (1) When the suit is purely speculative, e. g., a suit for damages, such an agreement partakes of the nature of a gambling contract, and will not be enforced by the courts.4 (2) Nor will it be enforced when extortionate.5 Hence, a contract that attorneys at law should receive half the land in litigation if successful is invalid.6 (3) But when there is an interest in litigation which the client has not the means to pursue, an agreement freely entered into by him, to give a fair share in v. Downes, 18 Ves. 120; Simpson v. Lamb, 7 E. & B. 84; Dunn v. Record, 63 Me. 17; Stanton v. Haskin, 1 Mac-Ar. 558; Arden v. Patterson, 5 Johns. Ch. 48; Coughlin v. R. R., 71 N. Y. 443; West v. Raymond, 21 Ind. 305. In Coughlin v. R. R., 71 N. Y. 443, Earl, J., said: "An attorney may stipulate with his client for any compensation they may agree upon, and such compensation may be absolute or contingent; but he may not purchase a claim for prosecution, and he may not advance, or agree to advance, any money for the purpose of inducing a party to place a claim in his hands for collection."

Agreement for contingent fees not necessarily unlawful.

1 Anderson v. Radcliffe, E. B. & E. 806, 819.

2 As to undue influence see supra, sec 161. In Knight v. Bowyer, 2 De G. & J. 445, Turner, L. J., said: " I am aware of no rule of law which prevents an attorney from purchasing what anybody else is at liberty to purchase, subject, of course, if he purchases from a client, to the consequences of that relation." See remarks of Exchequer Chamber, in Anderson v. Radcliffe, E. B. &.

E. 806. The New York statute prohibiting attorneys from purchasing bonds and choses in action for the purpose of bringing suit on them, does not apply to purchase of stock in corporations. Ramsey v. Gould, 57 Barb. 399.

3 See Sharswood's Legal Ethics, 102. In 23 Alb. L. J. 484; 24 Alb. L. J. 4, 18, 24, the question is discussed at large, and the ground is taken that such agreements are against the policy of the law. A reply to the latter papers was published by Judge Countryman, in Albany, 1882, under the title, "Compensation for Legal Services.".

4 Martin v. Clarke, 8 R. I. 389; Hal-loway v. Lowe, 7 Port. 488.

5 Gardener v. Ennor, 35 Beav. 549; Thurston v. Percival, 1 Pick. 415; Phillips v. Overton, 4 Hayw. 291; Rose v. Mynett, 7 Yerg. 30; Scoby v. Ross, 13 Ind. 107; Cognillard v. Bearss, 21 Ind. 479; Boardman v. Brown, 25 Iowa, 488; Lecatt v. Sallee, 3 Port. 115; Halloway v. Lowe, 7 Port. 488; Byrd v. Odem, 9 Ala. 755; Elliott v. McClelland, 17 Ala. 206.

6 Jenkins v. Bradford, 59 Ala. 400.

the proceeds to his counsel in consideration of aid given in the management of the suit, may be sustained.1 In this country, we have numerous rulings sustaining contracts for contingent fees that were not in themselves extortionate, and were free from fraud or abuse of confidential relations.2 In England, however, an agreement with an attorney for a contingent percentage has been held invalid;3 and we have cases in this country, which, while admitting the lawfulness of contingent fees within the limits above stated, hold that when they amount to a sharing of the proceeds of a speculative litigation, they are illegal,4 and that they are illegal when they

1 See Williams v. Protheroe, 5 Bing. 309.

2 Wylie v. Cox, 15 How. 415; Stanton v. Embrey, 93 U. S. 556; McPher-son v. Cox, 96 U. S. 404; Scott v. Harmon, 109 Mass. 237; Haight v. Moore, 37 N. Y. Sup. Ct. 161; Porter v. Parmly, 39 N. Y. Sup. Ct. 219; Marsh v. Holbrook, 3 Abb. Ct. of Ap. 176; Schomp v. Schenek, 40 N. J. L. 195; Strohecker v. Hoffman, 19 Penn. St. 227; Dickerson v. Pyle, 4 Phila. 259; Bayard v. McLane, 3 Harring. 139; Equit. Life Ass. v. Poe, 53 Md. 28; Major v. Gibson, 1 Pat. & H. 48; Allard v. Lamirande, 29 Wis. 502; Evans v. Bell, 6 Dana, 479; Cross v. Bloomer, 6 Baxter, 74; Moses v. Bag-ley, 55 Ga. 283; Hunt v. Test, 8 Ala. 713; Martinez v. Vives, 32 La. An. 305; see Plitt ex parte, 2 Wal. Jr. 453; Trist v. Child, 21 Wal. 441. In Duke v. Harper, 66 Mo. 51, it was held that a contingent fee was not champertous unless the attorney agreed to pay part of the expense of litigation. In Chester County v. Barber, 97 Penn. St. 455, the supreme court of Pennsylvania held that it was not within the power of county commissioners to make a contract giving a contingent fee of fifty per cent. See, also, Meguire v. Corwine, 101 IT. S. 111. That in contracts of this class the burden is on the attorney to prove fairness, see Nesbit v. Lock-man, 34 N. Y. 167; Hitchings v. Van Brunt, 38 N. Y. 335.

3 Earle v. Hopwood, 9 C. B. N. S. 566; Pinee v. Beattie, 32 L. J. C. 734.

4 Stanton v. Haskin, 1 MacAr. 558; Thurston v. Percival, 1 Pick. 415; Lathrop v. Bank, 9 Met. 489; Board-man v. Brown, 25 Iowa, 502; Hollo-way v. Lowe, 7 Port. 488; Elliott v. McClelland, 17 Ala. 206; see Evans v. Ellis, 5 Denio, 640; Howell v. Ransom, 11 Paige, 538.

In Ackert v. Barker, 131 Mass. 436, the defendant, in a suit by his client to recover $1000, set up that he was entitled to retain one-half the amount as his fee; and he testified to an agreement to this effect, and that he was not to be responsible for the expenses of the suit. It was held that the agreement was invalid. "The defendant's answer and bill of exceptions," said Gray, C. J., " fairly construed, show that the agreement set up by the defendant was an agreement by which, in consideration that an attorney should prosecute suits in behalf of his client for certain sums of money, in which he had himself no previous interest, it was agreed that he should keep one-half of the amount recovered provide for furnishing the funds to conduct the suit.1 - Should the agreement between the client and attorney be void for in case of success, and should receive nothing for his services in case of failure.

" By the law of England from ancient times to the present day such an agreement is unlawful and void for champerty and maintenance, as contrary to public justice and professional duty, and tending to speculation and fraud, and cannot be upheld, either at common law or in equity. 2 Rol. Ab. 114; Lord Coke, 2 Inst. 208, 564; Hobart, C. J., Box v. Barnaby, Hob. 117 a; Lord Nothingham, Skapholme v. Hart, Finch, 477; S. C, 1 Eq. Cas. Ab. 86, pi. 1; Sir William Grant, M. R., Stevens v. Bagwell, 15 Ves. 139; Tindal, C. J., in Stanley v. Jones, 7 Bing. 369, 377; S. C, 5 Moore & Payne, 193, 206; Coleridge, J., in re Masters, 1 Har. & Wall. 348; Shodwell, V. C, Strange v. Brennan, 15 Sim. 346; Lord Cotten-ham, S. C. on appeal, 2 Coop. Temp. (Tottenham, 1; Earle, C. J., Grell v. Levy, 16 C. B. (N. S.) 73; Sir George Jessel, M. R., in re Attorneys' & Solicitors' Act, 1 Ch. D. 573.

"It is equally illegal by the settled law of this commonwealth. Thurston v. Percival, 1 Pick. 415; Lathrop v. Amherst Bank, 9 Mete. 489; Swett v. Poor, 11 Mass. 549; Allen v. Hawks, 13 Pick. 79, 83; Call v. Calef, 13 Mete. 362; Rindge v. Coleraine, 11 Gray, 157, 162; 1 Dane, Ab. 296; 6 id. 740, 741. In Lathrop v. Amherst Bank, the fact that the agreement did not require the attorney to carry on the suit at his own expense was adjudged to be immaterial. 9 Mete. 492. In Scott v. Harmon, 109 Mass. 237, and in Tapley v. Coffin, 12 Gray, 420, cited for the defendant, the attorney had not agreed to look for his compensation to that alone which might be recovered, and thus to make his pay depend upon his success.

"The law of Massachusetts being clear, there would be no propriety in referring to the conflicting decisions in other parts of the country. If it is thought desirable to subordinate the rules of professional conduct to mercantile usages, a change of our law in this regard must be sought from the legislature and not from the courts.

"The defendant, by virtue of his employment by the plaintiff, and of his professional duty, was bound to prosecute the claims entrusted to him for collection, and holds the amount recovered as money had and received to the plaintiff's use. The agreement set up by the defendant that he should keep one-half of the amount, being illegal and void, he is accountable to the plaintiff for the whole amount, deducting what the jury have allowed him for his services and costs. In re Moshers and Grell v. Levy, above cited; Pince v. Beattie, 32 L. J. (N. S.) Ch. 734. Of Best v. Strong, 2 Wend. 319, on which the defendant relies as showing that, assuming this agreement to be illegal, the plaintiff cannot maintain this action, it is enough to say that there the money was voluntarily paid to the defendant with the plaintiff 's assent, after the settlement of the suit by which it was recovered; and it is unnecessary to consider whether, upon the facts before the court, the case was well decided,"

1 Martin v. Clarke, 8 R. I. 389; Weakly v. Hall, 13 Ohio, 167; Stearns v. Felker, 28 Wis. 594; Meeks v. Dewberry, 57 Ga. 263; Holloway v. Lowe, 7 Port. 488; and other cases cited in Wald's Pollock, 296; Story on Cont. sec 713, As deprecating the practice, champerty, the attorney is entitled to recover on a quantum meruit.1.