because that determines the risk of the client and the commensurate responsibility of the lawyer. (5) The result of the case, because that determines the real benefit to the client. (6) The eminence of the lawyer at the bar, or in the specialty in which he may be practicing.

"Each case, of course, differs to some extent from every other case in respect of the importance of these several elements.

"In some cases the time element is dominant; in others the skill used seems specially to stand out; and in others still, the amount which a defendant has been saved, or which a plaintiff has recovered, may be the dominating consideration in the charge. But if all these elements are considered together, and the relative importance of each element is fairly weighed by an attorney, it is possible to arrive at a proper charge in almost any case without much difficulty.

"For many years, in my own practice, I used these elements in determining fees, and I have found that by using them it was possible so to rationalize the basis of charges as seldom to have disputes with any but the most unreasonable clients" (p. 927).

The following is from Corpus Juris:

"The circumstances to be considered in determining the compensation to be recovered are the amount and character of the services rendered; the labor, time, and trouble involved; the nature and importance of the litigation or business in which the services were rendered; the responsibility imposed; the amount of money or the value of the property affected by the controversy, or involved in the employment; the skill and experience called for in the performance of the services; the professional character and standing of the attorney; the results secured; and whether or not the fee is absolute or contingent, it being a recognized rule that an attorney may properly charge a much larger fee when it is to be contingent than what it is not. The financial ability of defendant may also be considered by the jury, not to enhance the amount above a reasonable compensation, but to determine whether or not he is able to pay a fair and just compensation for the services rendered, or as an incident in ascertaining the importance and gravity of the interests involved in the litigation. But what is a reasonable fee must in a large measure depend upon the facts of each particular case" (pp. 750-752).

10. Applying the principles above stated, and other recognized principles of law, to the record before the committee and above referred to, I offer the following in support of my opinion;

(a) During the period of 15 months, the case had painstaking and unremitting attention on the part of Messrs. Martineau and Lewinson, and during 10 months it was the major occupation of either or both of them. In addition, lawyers in their employ spent time aggregating 35 weeks in briefing law points and in research and investigation of files. Furthermore, Messrs. Martineau and Lewinson carried their own overheads during the period of employment, and obligated themselves to do work that might have been their respective major occupations for 3 years or more, and might have resulted in no recovery.

(b) The claim of the Government was not only stale and doubtful, but was also highly technical and had little equitable appeal, because the Government had already recovered $28,000,000 on losses aggregating less than $16,000,000. The handling of the claim required a combination of energy, industry, strategic sense, and skill in negotiation rarely found at the bar.

(c) It is difficult to exaggerate the skill employed in handling the claim. It was certainly of the very highest order.

(d) The amount involved was large, but not so large as to preclude employment on the basis of a retainer and 10 percent of the recovery.

(e) The result in the case was little short of remarkable. As the Attorney General said in his statement, it might well have been a "wash-out." It cannot be said with any assurance that the Government was entitled to more than $400,000, and there was a serious technical question of survivorship which might have defeated recovery of even that sum. The settlement of $3,000,000, in my opinion, is a tribute to the skill of the counsel employed more than to the merits of the cause.

It

(f) It is not necessary to speak of Mr. Martineau's standing at the bar. has been shown in the testimony of Mr. Justice Stephens and former Attorney General Cummings, but I may add that Mr. Martineau has an enviable professional reputation in Los Angeles County and the State of California, particularly as a specialist in intricate oil litigation.

Mr. Lewinson is, and for many years has been, one of the most distinguished members of the California bar. He is without a superior in California as a technical lawyer and a negotiator, and has few equals as a trial lawyer, particularly in handling complicated facts and abstruse questions of law.

(g) Even without the element of contingent compensation, a fee of $250,000 would be altogether reasonable, and contingent compensation of 10 percent of the recovery less the sum of $25,000, heretofore paid Messrs. Martineau and Lewinson, would be fair and reasonable and in accordance with established usages and practices, particularly those prevailing in Los Angeles County, Calif.

Further affiant sayeth not.

GUY RICHARDS CRUMP.

Subscribed and sworn to before me this 2d day of March 1939. [SEAL] HERTHA N. EBERT, Notary Public.

AFFIDAVIT OF JOHN PERRY WOOD, ON REASONABLE VALUE OF SERVICES OF SPECIAL ASSISTANTS

STATE OF CALIFORNIA,

County of Los Angeles, 88:

John Perry Wood, being first duly sworn, on oath deposes and says:

1. He is a member of the bar of the State of California, of the United States district and circuit courts, and of the Supreme Court of the United States. He has practiced law at the bar or upon the bench in Los Angeles, Calif., for 36 years. From 1906 to 1911 he was city attorney of the city of Pasadena, Calif. From 1911 to September of 1925 he was a judge of the Superior Court of the State of California, in and for the county of Los Angeles. Upon the date last mentioned he resigned from said court, and since then has actively practiced law in said county and elsewhere. His practice has been largely the preparation and trial of causes. He has been associated in many causes of moment by other lawyers. He is familiar with the fees charged and received in said county and State by lawyers of ability in complicated and difficult cases.

2. Affiant for 4 years was a member of the board of governors of the State Bar of California. For 5 years he has been, and now is, chairman of the committee on judicial selection and tenure, first of the conference of bar association delegates of the American Bar Association, then of the association itself. He is, and for several years has been, the representative of the Los Angeles Bar Association in the House of Delegates of the American Bar Association. Affiant has an extensive acquaintance with lawyers throughout the State of California and in other States, and has considerable knowledge of fees charged and received by lawyers of standing, not only in California but in Chicago and in New York.

3. Affiant knows the standing of Joseph L. Lewinson and L. R. Martineau, Jr., at the Los Angeles bar. Both enjoy a high reputation for learning and integrity.

Affiant is acquainted more particularly with the ability and standing of Joseph L. Lewinson. He has been engaged in controverted matters in which Joseph L. Lewinson was on the other side. Lewinson has been a most difficult and dangerous opponent. When affiant was upon the bench, Joseph L. Lewinson tried cases before him. In the opinion of affiant, no man of the bar of the State of California possesses greater ability to successfully handle complicated litigation, or successfully to prepare a cause to enable the greatest benefit to his client in the course and consummation of negotiations for settlement, than Joseph L. Lewinson. He is an extraordinarily able and resourceful negotiator. If affiant had a case of the most transcendent importance to him personally, involving abstruse and difficult questions of law and fact, he would prefer Joseph L. Lewinson as his counsel to any lawyer of his acquaintance; this not by reason of any peculiar feeling of friendship of affiant toward Lewinson, but because of affiant's knowledge of Lewinson's ability and qualifications.

The reputation of Joseph L. Lewinson at the bar of California comports with affiant's own knowledge and opinion of the qualities and abilities of Lewinson. 4. Affiant has read the bills authorizing payment of additional compensation to special assistants to the Attorney General, designated "Seventy-sixth Congress, first session, H. R. 4366" and "Seventy-fifth Congress, second session, "I. R. 8662." He has read the transcript of the testimony before the Committee

on the Judiciary of the House of Representatives taken on December 13, 1937, on the hearing on the bill designated "H. R. 8662," and a copy of the letter of Messrs. Martineau and Lewinson of May 25, 1937, addressed to the Attorney General, Washington, D. C., and referred to in said transcript, and he has read the printed transcript of the oral argument of Joseph L. Lewinson in opposition to motion to quash writ of scire facias in case No. 6726-J, in the District Court of the United States for the Southern District of California. Affiant is thereby advised of the work done by Messrs. Martineau and Lewinson and of the difficulty and complications thereof and of the result obtained. He is apprised, also, thereby of the amount of time and effort given by Messrs. Martineau and Lewinson in behalf of the Government in the cause referred to at the hearing mentioned.

5. In affiant's opinion, the services of Messrs. Martineau and Lewinson have a minimum value of not less than $300,000, and a maximum value of $500,000. Payment to them by the Government of a lesser amount than $300,000 would, in the opinion of affiant, be unjust and unfair to them.

In reaching this conclusion affiant has in mind the ability, standing, and worth as lawyers of Messrs. Martineau and Lewinson, the difficulty of the cause, the amount of time by them given thereto, and the result obtained. In affiant's opinion the minds of reasonable lawyers and laymen could not fail to agree in the conclusion that these lawyers have done an extraordinary piece of work and have accomplished a result that few other lawyers in the same situation would have accomplished. If the laborer is worthy of his hire then these gentlemen are entitled to a total fee of not less than $300,000.

Affiant, in arriving at the conclusion expressed, also has in mind the fact that it is only in cases involving large amounts and where the client is successful that lawyers can expect to receive substantial fees. When, as in the case referred to, the lawyers have recovered so large a sum as Messrs. Martineau and Lewinson were instrumental in recovering in the cause referred to, the Government, just as a private client, should be willing to pay an adequate fee.

JOHN PERRY WOOD.

Subscribed and sworn to before me this 3d day of March 1939. [SEAL] ELEANOR D. KIELMEIER, Notary Public.

AFFIDAVIT OF WILSON MCCARTHY

STATE OF CALIFORNIA,

County of Los Angeles, 88:

Wilson McCarthy, being first duly sworn, deposes and says:

I am a member of the American Bar Association and a member of the bar of the States of California and Utah. I now reside at Denver, Colo. From 1914 to 1916 I was assistant county attorney of Salt Lake County, Utah. From 1916 to 1918 I was district attorney for the third judicial district of the State of Utah with my office at Salt Lake City, Utah. Thereafter I was judge of the District Court of the Third Judicial District of the State of Utah. Upon the expiration of my term on the bench I resumed the general practice of law at Salt Lake City, Utah, and, without interruption, was so engaged for 12 years, my work consisting chiefly of banking and corporation law, matters in receivership, and the trial and disposition of litigation, in law and in equity, in both State and Federal courts.

Upon the organization of the Reconstruction Finance Corporation in January 1932, I was appointed a member of the first Board of Directors thereof, and I served in that capacity until the month of October 1933. During this period I was engaged on behalf of the Reconstruction Finance Corporation in the handling of financial matters pertaining to railroads, insurance companies, banks, building and loan associations, livestock-credit corporations, Federal land banks, joint-stock land banks, and other institutions, and with the legal aspects thereof and litigation relating thereto. In particular, I had charge of setting up the regional agricultural credit corporations throughout the United States, and of supervising loans, through these institutions, aggregating upward of $350,000,000. I also set up the Irrigation and Drainage Division of the Reconstruction Finance Corporation. As a Director thereof, I participated in the making of all loans by that Corporation during my term of office.

In October 1933 I resigned from the Board of Directors of the Reconstruction Finance Corporation in order to return to the practice of law and immediately thereafter engaged in general civil practice at Oakland and San Francisco, Calif., under the firm name of McCarthy, Richards & Carlson, with offices at Oakland, Calif. As previously, my work consisted chiefly of corporate matters and litigation.

In December 1934 I became president of the Denver & Salt Lake Railroad with headquarters at Denver, Colo., and am still acting in that capacity.

In November 1935 I was appointed by the United States district court at Denver, Colo., as cotrustee of the Denver & Rio Grande Western Railroad; and, in that capacity, I have, with my cotrustee, the management and operation of the Denver & Rio Grande Western Railroad system.

I am a director of First National Bank of Denver and of Mountain States Telephone & Telegraph Co., and I am vice president and director of Western Livestock Show, of Denver, Colo.

In my experience in the private practice of law and upon the bench as a trial judge, I have become familiar with the compensation of lawyers for many types of legal services, and as an officer, director, or manager of various corporations, I have, on many occasions, employed attorneys as counsel and as attorneys in litigated matters for many types of legal services. I know from experience the basis upon which the reasonableness of fees for legal services is determined throughout the United States, including the State of California.

I make this affidavit in connection with the matter of additional compensation for special assistants to the Attorney General of the United States, and, in that connection, I have considered the following:

(a) In general, the background and history of the litigation relating to the Teapot Dome and Elk Hills oil scandals;

(b) The case of United States v. Doheny, in the prosecution of which Messrs. L. R. Martineau, Jr., and Joseph L. Lewinson were employed as special assistants to the Attorney General to represent the interests and to enforce the rights of the United States;

(c) The transcript of the hearing held February 3, 1937, before the United States Senate Committee on Public Lands and Surveys relating to the proposed settlement of said case of United States v. Doheny and, after which, the settlement of said case upon the terms negotiated by Messrs. Martineau and Lewinson was approved by the Secretary of the Navy and the Attorney General;

(d) The transcript of the hearing held September 13, 1937, before the Committee on the Judiciary of the House of Representatives relating to the payment of additional compensation to said special assistants to the Attorney General;

(e) The letter of Messrs. Martineau and Lewinson addressed to the honorable the Attorney General of the United States, under date of May 25, 1937, explaining the nature and extent of the services rendered by them;

(f) The pleadings in said case of United States v. Doheny and the files relating to said matter and, in general the records of the preceding litigation out of which said action grew;

(g) The extend and nature of the claim of the United States and the result of the litigation and negotiations leading to settlement and payment to the United States of $3,000,000; and

(h) The pending bill (H. R. 4366) to authorize the payment of additional compensation.

From all of these considerations, and in view of the complex legal problems involved, the time consumed in dealing with the matter of the employment, the elements of skill required and used, the amount involved in the claim of the United States, the results achieved by litigation and negotiation, the elements of responsibility, and the standing at the bar of the attorneys employed, I am of the opinion that 10 percent of the amount recovered for the United States would be a reasonable total compensation to be paid to the special assistants to the Attorney General who handled this difficult and important piece of litigation in such a successful manner.

Without stating in detail the numerous items appearing in the record and entering into the factors upon which I base my opinion, there is, however, one element which I have considered and which may not be so readily apparent, namely, the ability and eminence of the attorneys employed. I am acquainted with the reputation at the bar of Joseph L. Lewinson, for his unusual ability and standing, but I am more particularly acquainted with the reputation of L. R. Martineau, Jr., whom I have known, both personally and professionally, since about the year 1913. From 1912 to 1927 Mr. Martineau was engaged in general civil practice at Salt Lake City, Utah, his work there being chiefly con

fined to corporate matters and important litigation. He was, in my opinion, easily one of the leaders of the Utah bar and his professional reputation was of the first order. Since he came to California in 1927 I have from time to time met him in connection with matters related to practice and I have kept so closely in touch with him that I am generally familiar with the nature of his work.

I have also had occasion to discuss his professional reputation with various members of the bar in California and elsewhere. Without dissent, his fellows give him the highest rating as to character, integrity, and ability. He was admitted to practice in 1912 in the State and Federal courts of Utah, and in 1914 in the United States district courts of California, and he is, I am informed and believe, at this time a member of the State bar of California, the State bar of Utah, the bar of the Supreme Court of the State of Idaho, and the bar of the Supreme Court of the United States, and he has been for many years a member of the American Bar Association. His work, for more than 20 years to my knowledge, has been largely confined to corporate matters and important litigation involving mining and banking law, large financial transactions, land titles, corporate reorganizations, and problems arising in the petroleum industry. In the last-named field, particularly, he has, in recent years, gained an enviable reputation. He has, among other things, successfully handled the defense of one of the most important litigated oil cases in the history of the United States. This suit, in which the Government was not a party, involved the defense of a unit operation and field development sponsored by the United States Government. In it Mr. Martineau was chosen as special trial counsel to represent the incorporated association which was organized as a means of conservation, and whose membership comprises many companies nationally known in the petroleum industry. The case was on trial for approximately 2 years and its successful defense is, in my judgment, an outstanding tribute to Mr. Martineau's ability in handling cases of the most involved and difficult nature.

In my opinion, the result achieved by Messrs. Martineau and Lewinson in the case of United States v. Doheny could not have been reached without an extraordinary amount of work and a high degree of skill, and the compensation hereinabove suggested would, in my opinion, be fair and reasonable and in accordance with prevailing legal fees, particularly in Los Angeles County, Calif. Further affiant saith not.

Dated this 13th day of March 1939.

WILSON MCCARTHY.

Subscribed and sworn to before me this 13th day of March 1939. [SEAL]

ALICE M. GIESCHEN, Notary Public.

My commission expires November 5, 1939. Mr. FORD. Thank you for giving me an opportunity to appear before you at this time. I have another hearing to attend, so if you will excuse me, I will go.

Mr. WEAVER. I do not know who will control the presentation of these witnesses. Will you do that, or will we just take them as they come?

Mr. FORD. You can take them from the way they are presented: Mr. Hogan, Mr. Hurley, Mr. Martineau, Justice Stephens, and Mr. Lewinson. If that is satisfactory to the committee, I will appreciate it.

Mr. WEAVER. Yes; it will be satisfactory.

Mr. FORD. Thank you, gentlemen.

Mr. WEAVER. We will be glad to hear from Mr. Hogan, and to have such statement as you desire to make to the committee.

STATEMENT OF HON. FRANK J. HOGAN, PRESIDENT OF THE AMERICAN BAR ASSOCIATION, WASHINGTON, D. C.

Mr. HOGAN. Mr. Chairman, and gentlemen of the committee, for the record I think I should state my name is Frank J. Hogan. I reside in Washington, D. C., and have resided here for 40 years.