Bauman v. Metzger

• Decision Date: 13 February 1920
• Docket Number: No. 21500.,21500.
• Citation: 145 Minn. 133,176 N.W. 497
• Parties: BAUMAN v. METZGER et al.
• Court: Minnesota Supreme Court

145 Minn. 133

176 N.W. 497

BAUMAN

v.METZGER et al.

No. 21500.

Supreme Court of Minnesota.

Feb. 13, 1920.

Appeal from District Court, Hennepin County; Chelsea J. Rockwood, Judge.

Action by H. J. Bauman, continued after his death by Catherine Bauman, as executrix, and others, against Leopold Metzger, and others, owners, one Worthingham, a lien claimant, with counterclaim by defendants Metzger and others. Judgment against owners in favor of plaintiff and in favor of defendant Worthingham declaring such judgments to be liens, motion for new trial denied, and defendants Metzger and others, appeal. Order denying a new trial of issue between plaintiff and owners reversed and a new trial granted, and order denying a new trial of issues between defendant Worthingham and owners affirmed in part and reversed in part.

Hallam, J., dissenting.

Syllabus by the Court

Under an agreement between the owners of a building and the tenants of the ground floor extensive changes were to be made in this floor which required minor changes in other parts of the building. Plaintiff did the entire work under two contracts made as parts of the same transaction-one in writing with the tenants to make the changes in the ground floor, and the other oral with the owners to make the other changes. While the owners did not join in the written contract, it was understood that they were to pay, and they did pay, one-half the cost of the work performed under it, and plaintiff was paid in full for this work. Later it was discovered that by plaintiff's negligence in performing this work other parts of the building had been damaged. He brought this action to enforce a mechanics' lien for the value of the work performed for the owners, and they interposed a counterclaim for such damages. It is held: That the owners had a cause of action in tort for the damages; that the statute permitting counterclaims should be liberally construed to the end that the rights of both parties may be determined in a single action; and that the counterclaim was ‘connected with the subject of the action’ within the meaning of the statute.

The claim of the owners for loss of rent resulting from a breach of the written contract to which they were not parties was correctly excluded.

The evidence is sufficient to sustain the finding that defendant Worthingham was entitled to a personal judgment, but he was not entitled to a lien on the property for the reason that he failed to file his answer asserting it within the time required by statute. His claim that this point was not raised in the court below and therefore cannot be raised here is not sustained.

As the statute requires the answer to be filed instead of being served, it was of no effect until filed.

Worthingham's claim was not barred by the judgment of the conciliation court offered in evidence as it does not appear that the issues here involved were determined in that proceeding and the parties are different. Simon Meyers, of Minneapolis, for appellants.

C. C. Joslyn, of Minneapolis, for Worthingham, and J. M. Pulliam and J. H. Green, both of Minneapolis, for respondents.

TAYLOR, C.

This action was brought under the Mechanics' Lien Law (Gen. St. 1913, §§ 7020-7087) to enforce a claim for making alterations and repairs in a building known as the Hotel Landour in the city of Minneapolis. The trial court directed that judgment be entered against the owners of the building for the sum of $249.01 with interest, costs, and disbursements in favor of plaintiff, and for the sum of $47.93 with interest, costs, and disbursements in favor of defendant Worthingham, another lien claimant, and that these judgments be declared liens on the property and that the property be sold to satisfy such liens. The owners made a motion for a new trial and appealed from the order denying their motion.

The owners practically conceded plaintiff's claim but as an offset thereto alleged and sought to prove a counterclaim in excess of the amount of plaintiff's claim. The court excluded this counterclaim on the ground that it sounded in tort and did not arise out of the transaction pleaded in the complaint and was not connected with the subject of the action. The owners challenge this ruling as error.

[1][2] A brief outline of the facts is necessary to understand the situation. The owners leased the ground floor of the building to Floan and Leveroos to be occupied as a store. Expensive alterations were necessary to fit it for their use and the owners agreed to bear half of this expense. Thereupon Floan and Leveroos made a written contract with plaintiff to make these alterations for the sum of $7,325. These alterations made minor changes necessary in other parts of the building and the owners made a verbal contract with plaintiff to make these minor changes. These two contracts were made at the same time, and although the written contract was between plaintiff and Floan and Leveroos only, plaintiff knew that it was made in furtherance of the agreement between Floan and Leveroos and the owners, and that the owners were to pay one-half of the contract price for this work. Plaintiff performed this contract and was paid in full therefor, Floan and Leveroos and the owners each paying one-half thereof. Plaintiff also performed the verbal contract and also performed some extra work on the building at the instance of the owners. After plaintiff had been paid for the work performed under the written contract it was discovered that, in doing this work, plaintiff had disconnected the heating pipes in the building without draining the water therefrom, and that these pipes had frozen and burst causing the major part of the damage sought to be recovered under the counterclaim. Damages were also claimed for injuries to the walls of the building, and to the papering and painting in some of the rooms, and also for loss of rent resulting from plaintiff's failure to complete the work under the written contract within the time stipulated therein. Claiming that the damages exceeded the value of the extra work and of the work done under the verbal contract, the owners refused to make any further payment, and plaintiff filed a lien for the extra work and for the work done under the verbal contract and brought this action to enforce it.

The written contract was between plaintiff and Floan and Leveroos only. The owners not being parties to this contract the court correctly ruled that under the pleadings they were not in position to enforce a claim for damages predicated upon a breach of its terms. Consequently the claim for loss of rent was properly excluded as it was based on an alleged breach of a stipulation in this written contract. But if plaintiff, in performing this contract, negligently caused damage to the building, the owners could maintain an action therefor in tort independent of the contract; and if this cause of action was ‘connected with the subject’ of plaintiff's action, the owners were entitled to interpose it as a counterclaim in plaintiff's action. G. S. 1915, § 7757.

The statute permitting counterclaims is remedial in its nature and to be lberally construed to the end that the rights of both parties may be determined in a single action. What may be interposed as a counterclaim on the ground that it is ‘connected with the subject of the action’ is not as clear and well defined as we might desire, although many cases involving particular counterclaims have been before the court to a few of which we will refer. In Barker v. Walbridge, 14 Minn. 469 (Gil. 351), it is said that a cause of action in defendant, if connected with plaintiff's cause of action ‘so that the determination of plaintiff's cause of action would not do exact justice without at the same time determining defendant's cause of action,’ is within the statute. Goebel v. Hough, 26 Minn. 252, 2 N. W. 847, was an action for rent, and the defendant was permitted to interpose a counterclaim for damages for wrongfully entering upon and interfering with his use of the premises. Lahiff v. Hennepin, etc., Ass'n, 61 Minn. 226, 63 N. W. 493, was an action by a mortgagor to reform the mortgage. The mortgagee interposed a counterclaim to foreclose the mortgage as reformed, and also interposed a second counterclaim to reform and foreclose a second mortgage on the same property. In sustaining the second counterclaim the court observed:

‘The second mortgage is not one arising out of the contract of transaction set forth in the plaintiff's complaint as the ground of the plaintiff's claim or cause of action, but it is connected with the subject of the action, because it is a mortgage between the same parties upon the identical piece of land described in the first mortgage.’

Hackett v. Kanne, 98 Minn. 240, 107 N. W. 1131, was an action to enjoin defendant from trespassing on plaintiff's land and it was held that defendant could interpose a counterclaim to have the boundary line between his land and that of plaintiff determined. Wild Rice Lumber Co. v. Benson, 114 Minn. 92, 130 N. W. 1, was an action to enjoin defendant from interfering with plaintiff's logging railroad. Defendant interposed two counterclaims-one for damages for wrongfully entering upon and interfering with his possession and use of the land over which the road passed, and one for damages on account of the negligent manner in which plaintiff operated its locomotive. It was held that the first counterclaim was proper but that the second was not.

In the present case the purpose was to fit the ground floor of the building for the use of the tenants as a store, and to make such changes and repairs in other parts of the building as the changes in the ground floor rendered necessary. To accomplish this purpose plaintiff was employed to do the entire work, and two contracts, which between them were intended to cover the entire work, were made with him at the same time and apparently as parts of the same transaction, and the work under...