Reacus Gibbs and Wanda N. Gibbs, His Wife v. Leroy J. Blackwelder, and Mary Louise Blackwelder, His Wife, 346 F.2d 943, 4th Cir. (1965)

346 F.
2d 943
Reacus GIBBS and Wanda N. Gibbs, his wife, Appellants,

v.
Leroy J. BLACKWELDER, and Mary Louise Blackwelder, his
wife,
Appellees.
No. 9616.
United States Court of Appeals Fourth Circuit.

Argued Jan. 6, 1965.
Decided June 2, 1965.
Richard M. Millman, Washington, D.C., for appellants.

No appearance for the appellees.
Before HAYNSWORTH, Chief Judge, BOREMAN, Circuit Judge, and
HUTCHESON, District Judge.
HAYNSWORTH, Chief Judge:
In litigation arising out of a land transaction in Florida, the plaintiffs, Gibbs,

obtained a judgment in Florida against the defendant, Leroy J. Blackwelder, for
a sum in excess of $35,000. Unable to collect the judgment in that State, they
brought suit upon the Florida judgment in the United States District Court for
the Eastern District of Virginia. There, the issue became the availability of
certain lands, titled in the name of Mrs. Blackwelder, for the satisfaction of the
husband's debts. The lands are said to be of very substantial value and the claim
of the Gibbs one of several claims against the husband which will be collectible
only if the lands standing in the name of the wife are available for their
satisfaction.
Extended proceedings in the District Court resulted in a memorandum opinion

and a decree in which the District Court held that Mr. Blackwelder did have an
interest in the lands and that they were available for the satisfaction of his
debts. There has been no appeal from that decree. In a supplemental
memorandum opinion, however, the District Court refused to allow fees to the
plaintiffs' attorneys, except certain minor sums in connection with their
obtaining an order requiring the defendants to answer questions propounded in
the taking of depositions, and it charged one of the plaintiffs' attorneys with
$250 for having advised the plaintiffs to refuse to answer questions propounded
to them. This appeal comes from the refusal to allow attorneys' fees to the
plaintiffs in general and from the $250 charge against the attorney in favor of
the defendants.
3
The District Court was under the impression that the request for the allowance
of fees for the plaintiffs' attorneys was for the benefit of the attorneys and not
for the benefit of the plaintiffs. He said in his memorandum opinion:
'The fees here claimed would not go to the plaintiffs. They are for the
attorneys. The plainiffs have not asked that they be reimbursed for attorney fees
incurred. In any event they would not be entitled to recover more than they had
agreed to pay their attorneys and there is no evidence in this case what that
amount is.'
Now, at least, it is clear that the request for the allowance of fees is for the
benefit of the plaintiffs. It is founded upon the principle that when one who,
while establishing his own claim, also establishes the means by which others
may collect their claims, a chancellor in equity may award counsel fees to the
trail blazer out of the property made available for the satisfaction of all claims.
The principle is applied so that the one who led in hewing the path to victory is
not left saddled with extensive attorney's fees, which need not be incurred by
his more timid fellows who held back until the fruits of the pioneer's success
were laid before them. The principle is succinctly stated in Sprague v. Ticonic
National Bank, 307 U.S. 161, 165-7, 59 S.Ct. 777, 779-780, 83 L.Ed. 1184.
'* * * To be sure, the usual case is one where through the complainant's efforts
a fund is recovered in which others share. Sometimes the complainant
avowedly sues for the common interest while in others his litigation results in a
fund for a group though he did not profess to be their representative. The
present case presents a variant of the latter situation. In her main suit the
petitioner neither avowed herself to be the representative of a class nor did she
automatically establish a fund in which others could participate. But in view of
the consequences of stare decisis, the petitioner by establishing her claim
necessarily established the claims of fourteen other trusts pertaining to the same
bonds.
'That the party in a situation like the present neither purported to sue for a class
'That the party in a situation like the present neither purported to sue for a class
nor formally established by litigation a fund available to the class, does not
seem to be a differentiating factor so far as it affects the source of the
recognized power of equity to grant reimbursements of the kind for which the
petitioner in this case appealed to the chancellor's discretion * * *. Whether one
professes to sue representatively or formally makes a fund available for others
may, of course, be a relevant circumstance in making the fund liable for his
costs in producing it. But when such a fund is for all practical purposes created
for the benefit of others, the formalities of the litigation-- the absence of an
avowed class suit or the creation of a fund, as it were, through stare decisis
rather than through a decree-- hardly touch the power of equity in doing justice
as between a party and the beneficiaries of his litigation. As in much else that
pertains to equitable jurisdiction, individualization in the exercise of a
discretionary power will alone retain equity as a living system and save it from
sterility. * * *'
Here, Mrs. Blackwelder claimed the lands as hers and sought to show that
certain funds which were used in their acquisition originated with her. In this
proceeding the whole story has been brought to light and the District Court has
held that the husband does have an equitable interest in the lands, and that they
are available for the satisfaction of his debts. The plaintiffs say that there are
other creditors of the husband who are now prepared to assert their claims, thus
reaping for their own benefit the harvest the plaintiffs have cultivated through
this litigation.
Under these circumstances, equity would seem to require careful consideration

of whether or not the plaintiff's attorneys in this action should be allowed
reasonable fees payable out of the defendants' land, or its proceeds, so that the
plaintiffs alone will not have to bear the burden of the major attorneys' fees for
services which have redounded to the benefit of all of Mr. Blackwelder's
creditors. This may be done by fixing a reasonable value upon the services
rendered by the attorneys to all claimants who are creditors of Mr. Blackwelder
and who may now obtain with relative ease the satisfaction of their claims out
of the lands. The fees thus allowed should be credited by the attorneys against
the contractual obligation of the plaintiffs to pay fees to them, so that, to the
extent of the plaintiffs' contractual obligations for attorneys' fees, any
allowance of fees out of the proceeds of the land will redound to their benefit
and to their relief from the disproportionate burden of attorneys' fees they
otherwise would bear in comparison with other creditors of the husband.
10
Under these circumstances, we think it appropriate that the case be remanded to

the District Court for further consideration of the claim for attorneys' fees in the
light of the principle of Sprague v. Ticonic Bank, which, of course, has found
expression elsewhere.1
11
It is apparent that the District Judge thought that the fees suggested by the
attorneys as appropriate were unreasonable and excessive That may be, and, if
he is of the same opinion after further inquiry and consideration in light of this
declaration of his power to award attorneys' fees and their appropriateness, he
may disregard their suggestion and allow fees in an amount which the Court is
satisfied is reasonable.
12
It is also apparent that the District Judge thought that the plaintiffs' principal
attorney, himself, had made the proceedings more complicated than necessary
and he had other criticism of his conduct.2 The Court was also caustic in its
criticism of Blackwelder, whose outrageous conduct would have exhausted the
patience of Job.
13
Such matters the District Court may appropriately take into consideration in
fixing a reasonable value on the services rendered by the plaintiffs' attorney.
Mr. Blackwelder's conduct, unquestionably, made the task of the attorneys
more difficult and the performance of their duties more onerous. This would
tend to warrant the allowance of fees in a larger amount than would otherwise
be appropriate. On the other hand, if the plaintiffs' attorneys, themselves, made
the litigation more complicated and costly than need have been, that, too, may
be taken into account by a downward adjustment of the fees, which otherwise
would have been allowable, in an amount approximating the costs
unnecessarily imposed upon the other party. None of these things, however, is a
reason for refusal to consider the allowance of any fees.
14
We think the District Court appropriately awarded small fees for the plaintiffs'
costs in requiring the defendants to answer questions. However, we think the
order which required the plaintiffs' attorney, Millman, to pay to the defendants
$250, plus the cost of transcribing certain depositions, was inappropriate. Mr.
Millman had advised the plaintiffs to refuse to answer certain questions on
deposition which he thought improper. Under those circumstances, under Rule
37(a) of the Federal Rules of Civil Procedure, the defendants might have
applied to the Court for an order requiring the plaintiffs to answer the questions
propounded. In the event they had obtained such an order and the Court had
required the plaintiffs to answer those questions which had not been answered,
the Rule provides that the Court shall require the refusing party to pay the
reasonable costs incurred in obtaining the order requiring the answers, together
with reasonable attorneys' fees incurred in that connection.
15
Here, the defendants neither sought nor obtained an order requiring the
15
Here, the defendants neither sought nor obtained an order requiring the
plaintiffs to answer the questions they refused to answer upon the advice of Mr.
Millman. They have incurred no costs and have paid no attorneys' fees for
which they may be reimbursed under the provisions of Rule 37.
16
To the extent that the judgment below required the attorney, Millman, to pay
certain fees and costs to the defendants, it is reversed. The judgment insofar as
it disallows general attorneys' fees to the plaintiffs' attorneys is vacated and the
case remanded for further proceedings not inconsistent with this opinion.
17
Reversed in part; vacated in part and remanded.
Trustees v. Greenough, 105 U.S. 527, 26 L.Ed. 1157; Bebchick v. Public

Utilities Commission, D.C.Cir., 115 U.S.App.D.C. 216, 318 F.2d 187, 204;
Washington Gas Light Co. v. Baker, D.C.Cir., 90 U.S.App.D.C. 98, 195 F.2d
29; Adams v. Kehlor Milling Co., E.D.Mo., 38 F. 281
We do not understand the basis of the criticism of the attorney for dealing
directly with the defendant, Leroy J. Blackwelder, who was undertaking to
represent himself and who had no attorney with whom the attorney for the
plaintiffs might deal. We discern no overreaching or any other basis for censure
of the attorney here

Reacus Gibbs and Wanda N. Gibbs, His Wife v. Leroy J. Blackwelder, and Mary Louise Blackwelder, His Wife, 346 F.2d 943, 4th Cir. (1965)

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346 F.

Reacus GIBBS and Wanda N. Gibbs, his wife, Appellants,

United States Court of Appeals Fourth Circuit.

Richard M. Millman, Washington, D.C., for appellants.

In litigation arising out of a land transaction in Florida, the plaintiffs, Gibbs,

Extended proceedings in the District Court resulted in a memorandum opinion

Under these circumstances, equity would seem to require careful consideration

Under these circumstances, we think it appropriate that the case be remanded to

Reversed in part; vacated in part and remanded.

Trustees v. Greenough, 105 U.S. 527, 26 L.Ed. 1157; Bebchick v. Public

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