Opinion
Submitted May 29th, 1942.
Decided September 18th, 1942.
Allowance of $2,500 counsel fees to the respective counsel for the defendants, made at the time the Chancery Court entered a decree of reversal of its former decree on remittitur from the Court of Errors and Appeals, affirmed.
On appeal from a decree of the Court of Chancery advised by Vice-Chancellor Fielder, who filed the following opinion:
"Appeal having been taken from a portion of the final decree advised by me in this cause, entered February 16th, 1942, I state my reasons for the part to which objections are directed.
"On remittitur from the Court of Errors and Appeals due notice had been given of a motion for a decree of reversal of a decree of this court, in conformity with the opinion of the Court of Errors and Appeals ( 130 N.J. Eq. 607) and for the allowance of counsel fees to counsel for defendants American General Corporation and others.
"The opinion of the Court of Errors and Appeals determined in effect that American General Corporation had the legal right to purchase stock of Utility Equities Corporation in the amounts and for the prices at which such purchases were made and that there was nothing inequitable in connection therewith; that the purchases were not in violation of any fiduciary relation existing between the two corporations and were made in exercise of honest judgment by the directors of Utility Equities Corporation; that the evidence on which the reversed decree of this court was entered, did not establish fraud by or unjust enrichment of American General Corporation or that such purchases were other than the result of honest exercise of sound discretion by the directors of Utility Equities Corporation and that no cause had been shown by the complainant for setting aside the transactions complained of. The effect of that determination was that complainant's action had been improperly instituted and should not have been brought. It was therefore immaterial that it was nominally a derivative stockholder's suit. In fact no other stockholder joined with complainant.
"In view of the opinion of the Court of Errors and Appeals it seemed to me that in entering a decree of reversal in accordance with its opinion, I was under a duty to allow counsel fees to the defendants herein against whom the appellate court said that the decree of this court was erroneously entered, and to exercise proper discretion in the amount of such allowances. The cause had been heard originally by me and I was familiar with the work performed by all counsel in the preparation of trial briefs, in the examination of witnesses and in the presentation of arguments on behalf of the parties on the facts and the law in the briefs filed with me. By the reversed decree which had been entered on my advice, I allowed counsel fees of $10,000 to counsel for complainant. On the application for counsel fees on the remittitur I believed that the legal services rendered by counsel for the defendants were as extensive and as ably and diligently rendered as were the services of counsel for complainant. Application was made for much greater amounts of counsel fees than I allowed and in my opinion the allowance of $2,500 counsel fees to the respective counsel for defendants was a fair and reasonable allowance for the services rendered by them in the cause in this court. In awarding those sums I took into consideration that all defendants were interested in obtaining the same result and that the services of their respective counsel were necessarily supplementary, the one to the other, and that the amount of money involved was several hundred thousand dollars."
Messrs. Kessler Kessler, for the appellant. Messrs. McCarter, English Egner ( Mr. Robert Carey, Jr.), for the respondents.
The decree under review will be affirmed, for the reasons expressed in the opinion of Vice-Chancellor Fielder.
For affirmance — THE CHIEF-JUSTICE, PARKER, CASE, DONGES, PORTER, DEAR, WELLS, RAFFERTY, HAGUE, JJ. 9.
For reversal — BODINE, HEHER, PERSKIE, COLIE, THOMPSON, JJ. 5.