Morgan v. Hood ex rel. Page Trust Co., 211 N.C. 91 (1937)

Jan. 6, 1937 · Supreme Court of North Carolina

211 N.C. 91

MARY J. LEACH MORGAN and Her Husband, W. J. MORGAN, v. GURNEY P. HOOD, Commissioner of Banks, Ex Rel PAGE TRUST COMPANY, W. P. COVINGTON, and D. J. DALTON, JR., and NOLA B. DALTON.

(Filed 6 January, 1937.)

Judgments § 4 — Agent authorized to handle litigation has no authority to enter consent judgment on behalf of his principal.

An attorney employed to defend an action may not enter a consent judgment therein without special authority, nor may an agent authorized to look after and handle the litigation give the attorney employed by him for his principal authority to enter a consent judgment, and where the court finds that a party did not consent to the judgment which was entered by consent of her agent authorized to handle the litigation, it is error for the court to deny the party’s motion, aptly made, to set aside the judgment.

Appeal by defendant Nola B. Dalton from Williams, J., at April Term, 1936, of Hoice.

Eeversed.

This action was beard at April Term, 1936, of tbe Superior Court of Hoke County on tbe motion of tbe defendant Nola B. Dalton tbat a judgment rendered in tbe action at January Term, 1936, of said court, purporting on its face to be a judgment by consent of tbe plaintiffs and of tbe defendants D. J. Dalton, Jr., and Nola B. Dalton, be vacated and set aside, on tbe ground tbat sbe did not consent to said judgment.

At tbe bearing tbe court found among other things tbat tbe action was begun in tbe Superior Court of Hoke County on 27 July, 1935; tbat both tbe summons and tbe complaint in tbe action were duly served on tbe defendants,' D. J. Dalton, Jr., and Nola B. Dalton, who are brother and sister; tbat tbe defendant Nola B. Dalton, after tbe summons and complaint bad been served on her, conferred with tbe defendant D. J. Dalton, Jr., and authorized him to look after and handle tbe litigation for her; tbat thereafter tbe defendant D. J. Dalton, Jr., employed an attorney-at-law, who resided in Hoke County, to represent tbe said defendants jointly; tbat pursuant to said employment, tbe said attorney prepared an answer to tbe complaint for said defendants, in which all tbe allegations of tbe complaint which constitute a cause of action in favor of tbe plaintiffs and against tbe said defendants were denied; tbat said answer was duly verified by tbe defendant D. J. Dalton, Jr., and was duly filed by said attorney, acting for and in behalf of both said defendants; and tbat tbe defendant Nola B. Dalton was advised by tbe defendant D. J. Dalton, Jr., tbat said answer bad been prepared and duly filed.

Tbe court further found tbat tbe action was on tbe calendar for trial at January Term, 1936, of said court, and was duly called for trial at said term; that tbe plaintiffs and all tbe defendants except Nola B. Dalton were present in court wben tbe action was called for trial; tbat tbe defendant Nola B. Dalton bad not been notified tbat tbe action was on tbe calendar for trial at January Term, 1936, of tbe court, and did not know tbat tbe action would be tried at said term; tbat during tbe progress of tbe trial, a compromise of tbe matters in controversy between them was agreed upon by tbe plaintiffs, and tbe defendant D. J. Dalton, Jr., acting for bimself and for tbe defendant Nola B. Dalton; and tbat pursuant to said compromise a judgment purporting to be by consent of tbe plaintiffs and of tbe defendants D. J. Dalton, Jr., and Nola B. Dalton was prepared and signed by tbe judge presiding. Tbis judgment was duly filed in tbe action.

Tbe court further found tbat tbe compromise was not submitted to tbe defendant Nola B. Dalton, for ber approval, and tbat sbe did not know tbat tbe judgment bad been signed by tbe judge and filed in tbe action, until after tbe court bad been adjourned for tbe term; tbat immediately upon learning tbat tbe judgment bad been signed and filed, sbe employed counsel, and promptly filed ber motion tbat said judgment be vacated and set aside; and tbat sbe bad a meritorious defense to tbe cause of action alleged against ber in tbe complaint.

On tbe facts as found by it, tbe court was of opinion “tbat D. J. Dalton, Jr., was tbe agent of bis sister and codefendant, Nola B. Dalton, to handle tbe litigation for ber and to look after ber interests, and as such bad authority to agree to its termination by compromise or otherwise,” and accordingly adjudged “tbat tbe motion to vacate and set aside tbe consent judgment rendered at January Term, 1936, of tbis court be and tbe same is hereby denied, and tbe said motion is dismissed.”

From tbis judgment tbe defendant Nola B. Dalton appealed to tbe Supreme Court, assigning error in tbe judgment.

No counsel, contra.

Varser, McIntyre & Henry for appellant.

ConNOR, J.

At the bearing of appellant’s motion that the judgment rendered in this action at the January Term, 1936, of the Superior Court of Hoke County, and purporting on its face to be a judgment by consent of the plaintiffs and of the defendants D. J. Dalton, Jr., and Nola B. Dalton, be vacated and set aside on the ground that appellant did not consent to said judgment, the court did not find that the attorney who was employed by the defendant D. J. Dalton, Jr., to represent himself and the appellant jointly, as authorized by her, compromised the matters involved in the action and consented to the judgment in her behalf, solely by reason of bis employment as her attorney. The court found that the defendant D. J. Dalton, Jr., compromised the action and consented to the judgment in behalf of the appellant, as her agent, and that for that reason appellant is bound by the judgment.

It is well settled that an attorney-at-law has no authority to compromise his client’s case, or to consent to a judgment which will be binding-on his client, founded upon such compromise, unless he had been specially authorized so to do by his client. Such authority will not be presumed from his employment, and a judgment by consent of the attorney founded upon a compromise made by him, without such authority, will ordinarily be vacated and set aside on motion of the client made in apt time. See Bank v. Trotter, 207 N. C., 442, 177 S. E., 325; Chavis v. Brown, 174 N. C., 122, 93 S. E., 471; Bank v. McEwen, 160 N. C., 414, 76 S. E., 222; Morris v. Grier, 76 N. C., 410; Moye v. Cogdell, 69 N. C., 93. In the last cited ease, it is held that authority to compromise a case, and to consent to a judgment founded on such compromise, cannot be conferred upon an attorney by an agent who was authorized by his principal to employ an attorney. In that case a compromise made by an attorney as authorized by the agent was set aside on motion of the principal. She had not consented to the compromise and was therefore not bound by its terms.

The finding by the court in the instant case, that the defendant D. J. Dalton, Jr., was authorized by the appellant to employ an attorney-at-law to represent her in the action, does not support the conclusion by the court that the said D. J. Dalton, Jr., had authority to agree to a termination of the action by compromise or otherwise.

In view of the finding by the court that appellant did not consent to the compromise and to the judgment, there is error in the judgment denying her motion which was made in apt time. The judgment is

Reversed.