Opinion of the Court. may be made directly to the solicitors themselves, without any application by their immediate client. But, on behalf of appellants, it is insisted that the utmost which the court may do is to charge upon the property such reasonable expenses as complainants themselves incurred, and became directly and personally bound to meet; and, since appellees have received from the creditors, specially engaging their services, all that those creditors agreed to pay, it cannot be said that the compensation demanded in respect of such as were not parties, otherwise than by filing their claims with the register, constitute a part of the expenses incurred by the complainants. This is an aspect of the general question not presented in Trustees v. Greenough. It is true that the complainants are not shown to have incurred any personal responsibility for solicitors' fees beyond those stipulated, by special contract, to be paid to the appellees; and it is equally true that there was no express contract, on their part, to pay appellees such additional compensation as the court might allow and charge upon the property. Yet it is proven that when the appellees engaged their professional services to Branch, Sons & Co., and other complainants named in the bill, it was understood by the latter that their solicitors entered upon the preparation of the suit in the belief that they had the right to demand, and would demand, such additional compensation as was reasonable, in respect of unsecured creditors who accepted the fruits of their labors by filing claims; that, but for this understanding, appellees would have stipulated for larger compensation than was agreed to be paid by their particular clients; and that, in this belief and upon that understanding, they conducted the suit. Mr. Watts, in his deposition, says that on the occasion of his contract for a fee with Branch, he "stated to him that the bill which we should file, although it should be in the name of his firm, would be for the benefit of all the creditors of the Montgomery and West Point Railroad Company not secured by mortgage; and that in such cases the lawyer who filed the bill would be entitled to a fee from all the creditors who participated in the benefit of their labors; and that we should charge him so small a fee, with the Opinion of the Court. expectation that we should be paid a large fee out of the fund brought into court or condemned by our labors; and that such fee would be allowed by order of the Chancery Court, and a lien declared on the fund for the payment of such compensation; and with such understanding the paper [special contract for fee] was signed." Mr. Pettus says: "The bonds and other claims on which the bill was filed were less than a sixth of the unsecured debts of the Montgomery and West Point Railroad Company of the same class, and at the time that Pettus & Dawson were employed to bring the suit, that fact was known and discussed between the parties making the contract, and it was also discussed between said parties that the suit, if successful, would inure to the benefit of all the unsecured creditors who might claim the benefit of the decree, and that everybody who claimed the benefit of the services rendered by the complainants' solicitors would be bound to allow complainants' solicitors compensation out of that part of the fund distributable to them." There is no evidence in contradiction of these statements. Had Branch, Sons & Co., and their co-complainants, expressly stipulated to make such reasonable compensation, in addition to the fees they agreed to pay their solicitors, as the court might allow, in respect of other creditors filing claims, the case, it could not well be doubted, would come within the very letter of the decision in Trustees v. Greenough. Without at all conceding that an express contract of that character would have added to the power of the court in the premises, it seems to us that the present case is embraced by the reason of the rule announced in Trustees v. Greenough. When the litigation was commenced, the unsecured bonds of the Montgomery and West Point Railroad Company were without any value in the financial market. That litigation resulted in their becoming worth all, or nearly all, that they called for. The creditors who were entitled to the benefit of the decree had only to await its execution in order to receive the full amount of their claims; and that result was due to the skill and vigilance of the appellees, so far as the result of litigation may, in any case, be referred to the labors of counsel. When creditors filed their claims they had notice, by the bill, that the suit Opinion of the Court. was brought, not exclusively for the benefit of the complainants therein, but equally for those of the same class who should come in and contribute to the expenses of the litigation. Those expenses necessarily included reasonable counsel fees, which, upon every ground of justice, should be estimated with reference as well to the claims of the complainants who undertook to protect the rights of all the unsecured creditors, as of the claims of those who accepted the fruits of the labors of complainants and their solicitors. We are of opinion that the арpellees are entitled to reasonable compensation for their professional services in establishing a lien, in behalf of the unsecured creditors of the Montgomery and West Point Railroad Company, upon the property described in the suit instituted by Branch, Sons & Co. and others; and that such compensation should be made with reference to the amount of all claims filed in the cause, although the evidence thereof may have been retained in the custody of the respective creditors; excepting from such estimate or calculation not only the claims of the complainants named in the bill, and of other unsecured creditors who may have had special contracts with appellees, or settled with them, but, also, such claims purchased by appellants as were not filed for allowance under the decree. The decree below proceeded upon this basis. The court below did not err in declaring a lien upon the property in question, to secure such compensation as appellees were entitled to receive; for according to the law of Alabama, by one of whose courts the original decree was rendered, and by which law this question must be determined, an attorney-atlaw, or solicitor in chancery, has a lien upon a judgment or decree obtained for a client to the extent the latter has agreed to pay him; or, if there has been no specific agreement for compensation, to the extent to which he is entitled to recover, viz., reasonable compensation, for the services rendered. Ex parte Lehman, Durr & Co., 59 Ala. 631; Warfield v. Campbell, 38 Ala. 527. That lien could not be defeated by the corporations which owned the property purchasing the claims that were filed by creditors under the decree. The lien of the solicitor rests, by the law of that State, upon the basis that he is to be regarded as Syllabus. an assignee of the judgment or decree, to the extent of his fees, from the date of its rendition. This right of the solicitors is superior to any which the defendant corporations acquired, subsequent to the decree, by the purchase of the claims of unsecured creditors. It remains only to consider whether the sum allowed appellees was too great. We think it was. The decree gave them an amount equal to ten per cent. upon the aggregate principal and interest of the bonds and coupons filed in the cause, excluding those in respect of which there was, between appellees and complainants and others, special contracts for compensation. It is shown that appellees had with the complainants contracts for small retainers and five per cent. upon the sums realized by the suit. We perceive no reason for this discrimination against creditors who were not parties except by filing their claims after decree. One-half the sum allowed was, under all the circumstances, sufficient. For the error last mentioned The decree is reversed and the cause remanded, with directions to modify the decree so as to award to appellees only the sum of $17,580, with interest from March 7, 1881, with the benefit of the lien upon the property as established by the decree. Each party will pay his costs in this court, and one-half the cost of printing the record. STEELE v. UNITED STATES. APPEAL FROM THE COURT OF CLAIMS. Submitted December 22, 1884.-Decided January 19, 1885. A private sale of old material arising from the breaking up of a vessel of war, made by an officer of the Navy Department to a contractor for repairs of a war vessel and machinery, is a violation of the provisions of § 1541 Rev. Stat. The allowance of the estimated value of such material in the settlement of Opinion of the Court. such contractor's accounts is a violation of the provisions of § 3618 Rev. Stat. A settlement of such accounts at the Navy Department and at the Treasury, in which the contractor was debited with the material at the estimated value, does not preclude the United States from showing that the esti mates were far below the real value, and from recovering the difference between the amount allowed and the real value. Delay in enforcing a claim arising out of an illegal sale of property of the United States, at value far below its real worth, cannot be set up as a bar to the recovery of its value. This was an appeal from the Court of Claims. See 19 C. Cl. 182. The facts are stated in the opinion of the court. Mr. W. D. Davidge and Mr. R. B. Washington, for appellants. Mr. Solicitor-General, for appellee. MR. JUSTICE WOODS delivered the opinion of the court. The appellant was the claimant in the Court of Claims. He brought his suit April 30, 1880, to recover from the United States the sum of $3,400 for plumbing done by him on the United States Steamship Quinnebaug under a contract made with I. Hanscom, the Chief of the Bureau of Construction and Repair of the Navy Department, on behalf of the government, in the year 1875. There was no dispute that there was due to him on his contract for work done the sum sued for. The controversy arose on a plea of cross-demand, filed by the United States, which alleged that the officers of the government delivered to the appellant a large amount of old material to be utilized and reworked by him for the plumbing of the Quinnebaug; that a small portion of the material thus delivered he reworked for that purpose, but the greater portion thereof... he sold to third parties, realizing therefrom the sum of $20,000. The Court of Claims found that during the spring and summer of the year 1875, there were delivered to the appellant, by R. W. Steele, who was a naval constructor in the United States Navy, 103,949 pounds of old material resulting from the VOL. CXIII-9 |