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Troutman v. Southern Railway Co.

    Brief Fact Summary. A company retained an attorney to present their position on an agricultural issue to the President of the United States (the "President").  The company refused to pay the attorney for his services, arguing that their agreement was against public policy.

    Synopsis of Rule of Law. "[A] contract to influence a public official in the exercise of his duties is illegal and un[ ]enforceable when that contract contemplates the use of personal or political influence rather than an appeal to the judgment of the official on the merits of the case."

    Facts. The Plaintiff, Robert B. Troutman (the "Plaintiff"), an attorney in Georgia, brought this action against the Defendant, Southern Railway Co. (the "Defendant"), for legal services rendered in two matters – the Central of Georgia matter and the grain rate matter. In the grain rate matter, the Interstate Commerce Commission ("I.C.C.") ordered the Defendant to raise certain rates on grain shipments that would have cost it a lot of money.  An officer of the Defendant retained the Plaintiff due to his friendship with John F. Kennedy.  The Defendant's officer wanted the Plaintiff to persuade the head of the Department of Justice (the "DOJ") to support the Defendant's position in a lawsuit the Defendant had filed in federal district court to enjoin the rate increase by the I.C.C.  The Plaintiff was successful in convincing the DOJ to take its side in the litigation and as a result the I.C.C. regulation was struck down.  As a fee, the Defendant agreed to consider developing certain air rights to property owned
    by the Plaintiff, adjacent to property owned by the Defendant.  The joint development did not take place and the Plaintiff requested a money payment to cover his fee from the Defendant, but the Defendant refused.  The Plaintiff then initiated this lawsuit.  The Defendant alleged that the Plaintiff's suit violated the statute of limitations, that the Plaintiff's legal services were gratuitously rendered, and public policy forbid compensation for work done by the Plaintiff.  The jury rendered a verdict in favor of the Plaintiff.

    Issue. Does a contract, the purpose of which was for an attorney "to exert his personal and political influence upon the President of the United States", violate public policy?

    Held. No.  The court first observes that "a contract to influence a public official in the exercise of his duties is illegal and un[ ]enforceable when that contract contemplates the use of personal or political influence rather than an appeal to the judgment of the official on the merits of the case."  However, citizens are allowed to petition the government to redress their grievances and to that end they can "employ an agent or attorney to use his influence to gain access to a public official."  Further, if an attorney successfully obtains "an audience the attorney may fairly present to the official the merits of his client's case and urge the official's support for that position."  The court then agreed with the District Court, which stated, "only the elements of 'personal influence' and 'sinister means' [  ] will void the contract and deny it enforcement."  
    •    The court recognized that a case-by-case analysis is necessary to reach a conclusion on this issue.  The court acknowledged the juries conclusion that the Plaintiff agreed to get an audience with the President and present to him the merits of the Defendant's case.  There was not a sinister purpose.  The Defendant spoke to the President, the President's Special Deputy Counsel, the Assistant Attorney General and officials in the Department of Agriculture about the merits of the Defendant's case.  Based on these merits, the President decided the I.C.C. order would hurt the South's economy.  Testimony showed that only the merits of the case were involved and no improper outside influence was exerted.  Further, testimony also showed that it was common for attorneys to approach the Assistant Attorney General and advocate their client's views on certain legal and economic issues.  The court concluded "that a jury could reasonably find that Troutman was employed to use his influence, such as it was, merely to obtain an audience with the President and there to present to him the merits of Southern's position."

     

    Discussion. This case offers an interesting look at how courts construe whether something involves public policy.  There is a fine line between illegal influence peddling and lobbying about the merits of a dispute to a public official, including the President.


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