Brown v. Watkins Motor Lines, Inc.

THORNBERRY, Circuit Judge,

Dissenting:

As I read the Movant-Appellant’s brief, Mr. McRae argues that the federal district court was without power to award attorney’s fees because in Mississippi, law and equity are separate and this suit is a law action. And by so separating law and equity, the State of Mississippi has ousted the federal court of what would otherwise be within its equity jurisdiction. I believe that the Supreme Court disposed of this argument in 1887. I have included in the margin language from McConihay v. Wright, 121 U.S. 201, 206 , 7 S.Ct. 940 , 30 L.Ed. 932 (1887), that holds that a state may not oust the equity powers of a federal court. 1

The majority has not accepted the appellant’s argument but has instead sua sponte determined that no case or controversy exists. Because I find this case indistinguishable from Cappel v. Adams, 434 F.2d 1278 (5 Cir. 1970), I must respectfully dissent.

In Cappel v. Adams, supra, attorney Splawn represented Cappel and his family against the owners of an El Paso motel. Cappel had entered into a Vs contingent fee contract with Splawn for the amount of the recovery. The motel admitted liability and paid $100,000 into the registry of the court. Splawn moved for the amount of his attorney’s fees ($33,333.33), but the district court refused to award a full Vs recovery against *133 the award given to the minor plaintiffs. In affirming the district court we quoted from Garrett v. McRee, 201 F.2d 250, 253 (10 Cir. 1953):

where an attorney recovers a fund in a suit under a contract with a client providing that he shall be compensated only out of the fund he creates, the court having jurisdiction of the subject matter of the suit has power to fix the attorney’s compensation and direct its payment out of the fund.

Cappel v. Adams, 434 F.2d 1278 ,1279 (5 Cir. 1970).

The majority distinguishes Cappel because in the present case “no party petitioned the district court to fix such fees.” While this is undoubtedly true, I think the distinction misses the mark. There is not the slightest bit of evidence that any party in Cappel objected to the award of the full attorney's fees. If there was a case in controversy in Cappel, I cannot see how there is not one in the present case. I think Cappel must be deemed controlling unless we are prepared to hold that the Cappel court overlooked the absence of a case or controversy. 2

I respectfully suggest that there is a case or controversy present and the district court does have jurisdiction in this suit. The plaintiff’s action is against Watkins Motor Lines. Watkins defended this suit but eventually paid into the registry of the court over one-half million dollars. Here we have arcase or controversy. The distribution of the attorney’s fees is ancillary to this case or controversy. There is no requirement that each discreet step of the lawsuit must be adversary. It is enough that the case in chief be a case or controversy. Once the federal court has the res in its power it may distribute the proceeds “between solicitor and client.” 3

I think the attorneys of this circuit will be surprised to know that if they ask the federal court to award attorney’s fees they run the risk of equitable distribution, Cap-pel, but if they petition the court to transfer the entire award to a state guardian they run no such risk.

. The contention of the appellants, however, is that by the statute of West Virginia the complainant might have maintained an action of ejectment. Reference is made, in support of this contention, to the West Virginia Code of 1868, c. 90, to show that an action of ejectment in that state will lie against one claiming title to or interest in land, although not in possession. Admitting this to be so, it nevertheless cannot have the effect to oust the jurisdiction in equity of the courts of the United States as previously established. That jurisdiction, as has often been decided, is vested, as a part of the judicial power of the United States, in its courts by the constitution and acts of congress in execution thereof. Without the assent of congress, that jurisdiction cannot be impaired or diminished by the statutes of the several states regulating the practice of their own courts. Bills quia timet, such as the present, belong to the ancient jurisdiction in equity, and no change in state legislation giving, in like cases, a remedy by action at law, can of itself curtail the jurisdiction in equity of the courts of the United States.

McConihay v. Wright, 121 U.S. 201, 206 , 7 S.Ct. 940, 942 , 30 L.Ed. 932 .

. McRae distinguishes Cappel because it is a Texas case and in Texas law and equity are not separate entities. I have included in footnote 1, supra, why this distinction is of no moment.

. 1 need not comment if the district court abused its discretion in making the award.