Schrot v. Garnett , 370 Mich. 161 ( 1963 )

370 Mich. 161 (1963) 121 N.W.2d 722

SCHROT
v.
GARNETT.

Calendar No. 34, Docket No. 49,820.

Supreme Court of Michigan.

Decided May 9, 1963.

Maurice D. Sharai, for plaintiff.

BLACK, J.

To get his urgently supplicating client out of jail, the plaintiff attorney agreed with the client to pay certain of the latter's child support arrearages in the sum of $250. The agreement was made on strength of the client's promise to execute in favor of the attorney a mortgage of the client's home premises in the sum of $350. The amount of the mortgage, per agreement, was to be made up of the payment plus a counsel fee of $100.

The attorney paid the arrearages as agreed. The client, however, having been released from custody, refused to execute the agreed form of mortgage upon tender thereof to him for signature. To secure payment of the stipulated sum the attorney thereupon filed this bill to impress an equitable lien upon the defendant client's home premises. The bill duly alleged all facts requisite to equity jurisdiction, including total inadequacy of a remedy at law against defendant. The bill was duly taken as confessed upon entry of defendant's default; whereupon the trial chancellor dismissed the bill sua sponte. Plaintiff has appealed.

It was the judicial view below that plaintiff's remedy at law was adequate, a view with which we disagree. A right being shown which otherwise might appeal to equity's concurrent jurisdiction, and the legal remedy being established as inadequate, is by itself a sufficient invocation of such jurisdiction. For dependable discussion and clear exposition of this principle, see chapter 2, 1 Pomeroy's Equity Jurisprudence (5th ed), § 216 et seq., pp 366-391, headed "Inadequacy of Legal Remedies," and 19 Am Jur, Equity, § 111, p 116.

Upon de novo consideration it is ruled that plaintiff should have a decree in accord with the prayer of his bill. By failing to answer or move defendant has admitted all well-pleaded allegations of the bill, including inadequacy of legal remedy, and so the only question is whether by the principles of equity plaintiff is entitled to the lien he seeks. The equities being all 1 way, and the rights of no other creditor of defendant being disclosedly involved or affected, the judicial answer should be affirmative. In Kachman v. Sago, 331 Mich. 662, 667, this Court quoted the following from Cheff v. Haan, 269 Mich. 593, 598, 599:

"Equity from the relations of the parties may declare an equitable lien out of considerations of right and justice based upon the fundamental principles of equity jurisprudence"; and later, in Steggall v. Steggall, 274 Mich. 402, 405, went on to say:

"We indicated in Cheff v. Haan, 269 Mich. 593, 599, some of the conditions upon which a court of equity will create a lien upon real estate in the absence of a written contract, saying:

"`In all cases the person seeking to establish the lien must show that in equity, in good conscience, he is entitled to the lien claimed.'"

The quoted rules were announced first in Kelly v. Kelly, 54 Mich. 30, 47 (followed particularly as well as generally in Van Camp v. Van Camp, 291 Mich. 688, 696). They apply "in the absence of a written contract" where the intent to give identifiable security is clear and the complainant has dealt in reliance upon such intent. Plaintiff's bill makes the required clear showing, it having been taken as confessed by defendant.

Reversed and remanded for entry of decree in accord herewith. Costs to plaintiff.

CARR, C.J., and DETHMERS, KELLY, KAVANAGH, SOURIS, SMITH, and O'HARA, JJ., concurred.