Galusha v. Sherman

• Decision Date: 09 January 1900
• Citation: 81 N.W. 495,105 Wis. 263
• Parties: GALUSHA ET UX. v. SHERMAN ET AL.
• Court: Wisconsin Supreme Court

105 Wis. 263

81 N.W. 495

GALUSHA ET UX.

v.SHERMAN ET AL.

Supreme Court of Wisconsin.

Jan. 9, 1900.

Syllabus by the Judge.

1. The proper practice in an equity case is for the trial court to make findings covering specifically and separately each material fact in issue.

2. A controversy between two persons, actual and in good faith, is a proper subject for a binding contract of settlement, no matter what may be the real merits of the claim upon either side.

3. In the circumstances stated in the foregoing proposition, a settlement, free from mutual mistake of fact or mistake upon one side and fraud upon the other, is binding between the parties thereto without regard to which gets the best of the bargain or whether all the gain be in fact on one side and all the sacrifice on the other.

4. If, in making a contract, one party to the transaction be incapable of exercising his free will by reason of threats made by the other for the purpose of producing such condition, to the end that he may obtain such contract, such party may, at his option, repudiate such contract on the ground of duress.

5. What constitutes duress is matter of law; whether duress existed in a particular transaction is matter of fact. There is no legal standard of resistance which a person acted upon must come up to at his peril of being remediless for a wrong done to him, and no general rule as to the sufficiency of facts to produce duress. The question in each case is, was the person so acted upon by threats of the person claiming the benefit of the contract, for the purposes of obtaining such contract, as to be bereft of the quality of mind essential to the making of a contract, and was the contract thereby obtained?

6. The doctrine, that in order to produce duress by threats there must be such threats as are reasonably necessary to control by fear the free will power of a person of ordinary firmness and courage, is not the true doctrine or the law of this state.

7. While it is true that findings of fact requisite to avoid a contract on the ground of fraud must be based on clear and satisfactory evidence establishing such facts, where the trial court decides in favor of the existence of such facts on the evidence, such decision cannot be disturbed on appeal unless clearly wrong.

8. One who takes title to a promissory note payable to the order of a person therein named, merely by a transfer of the indebtedness contained in the assignment of the mortgage securing such note, is not entitled to the benefits of the law merchant as to such note, but holds it subject to the equities that would affect it in the hands of his assignor.

Appeal from circuit court, Eau Claire county; James O'Neill, Judge.

Action by D. H. Galusha and wife against Bradley B. Sherman and others. Judgment for plaintiffs. Defendants appeal. Affirmed.

Action in equity to set aside a note and mortgage on the ground of duress. The issues made by the pleadings sufficiently appear from the facts found by the trial court, which are in substance as follows: October 29, 1894, Bradley B. Sherman, claiming to have been injured by eating impure meat, believing it to be wholesome, which was furnished to him for food by D. H. Galusha with knowledge, or reasonable means of knowledge, of its character, commenced an action against Galusha to recover compensation for such injury to the amount of $5,000. A. J. Sutherland was Sherman's attorney. He employed J. H. Langdon to serve the summons and complaint, which service he performed and then advised Galusha to settle the claim, accompanying such advice by an assertion that if he did not do so he would be prosecuted criminally and sent to state's prison for from 3 to 14 years. Langdon induced Galusha to accompany him to Sutherland's office, where he was induced to mortgage his farm for $1,000 to secure a note for that amount payable in three years, with interest thereon at the rate of 8 per cent. per annum, in settlement of the controversy. Sherman assigned the note and mortgage to Sutherland and the latter assigned the same to H. V. Scallon, both assignments being recorded November 5, 1894. Galusha was a man of little education and experience, of a nervous temperament and easily frightened. The fact that a claim was made against him for more than he was worth, accompanied by threats of imprisonment for a long term of years if he did not settle it, deprived him of his freedom of will, and while he was in that condition the note and mortgage were procured. Such note and mortgage were given without consideration. The plaintiff Henrietta Galusha signed the note and mortgage in the absence of her husband, and in such a state of fear and excitement, caused by threats made to her, that it was not her voluntary act. The mortgaged property was worth $3,000. Defendant Scallon is not the bona fide purchaser of the note and mortgage. On such facts judgment was awarded to plaintiffs, declaring the note and mortgage null and void and requiring them to be surrendered for cancellation, and for costs against defendants. There was evidence tending to prove that at Sutherland's office Galusha was locked in a room with Sutherland, and there again threatened with arrest and imprisonment for from 3 to 14 years if he did not settle, and that such threats were accompanied with such demonstrations on the part of Sutherland as to greatly distract Galusha and put him in fear of personal violence.

L. A. Doolittle and Wickham & Farr, for appellants.

W. P. Bartlett, for respondents.

MARSHALL, J. (after stating the facts).

The cause does not seem to have been properly determined by the trial court by a finding on each material fact in issue. Presumably the practice was followed of deciding the issues in a general way and then signing findings prepared and presented by the successful party, without a sufficient examination of them to see whether all the material issues are properly and specifically determined. It is proper to permit the attorney for a prevailing party to prepare the findings, but his duty in that regard should be strictly confined to the drafting and submitting of a paper which, when signed and filed in the cause, will comply with the statute by containing an express adjudication as to the truth regarding each material issue and the legal results; and the judicial duty should always be performed of testing the paper by the decision made, before making it an official document. True, errors in that regard are not necessarily prejudicial, so as to call for a reversal, but it is the law, which should be followed just the same, that the successful party is entitled to have each material issue decided and to have such determination specifically and separately stated in the findings. While a trial court may neglect or refuse to perform the judicial duty in that regard, and without effect upon the final judgment, it is a matter of which the party so deprived of his legal rights may justly complain, and which this court may properly take notice of and condemn, in the interest of a careful administration of justice, whether the wrong affects substantial rights, so as to call for relief by a reversal of the judgment, or not.

The findings of fact as originally signed in this case contained, as one of the adjudications, a decision that all the material allegations of the complaint were true, while there were several such allegations upon which there was no evidence whatever, and some that were disproved by the uncontroverted evidence. That finding was stricken out by the circuit judge when his attention was called to it by the appellants' attorneys; but there was a refusal to find specifically upon some of the most material issues, either in the findings as prepared and signed, or when duly requested to do so by appellants' attorneys. For instance, there was no dispute but that Sherman ate meat at Galusha's table, which he believed, in good faith, caused him serious illness; that he commenced an action against Galusha to recover the damages caused to him by such illness, and that he and his attorney, and all persons concerned on his side of the controversy, down to and inclusive of the time the note and mortgage were given, honestly believed that Galusha knowingly, or with reasonable means of knowledge, furnished him dangerously impure meat to eat, thereby causing the injury of which he complained; that he was legally entitled to have Galusha make good the damages resulting from such injuries; that the note and mortgage were taken in satisfaction of such claim; and that the claim, in consideration thereof, was duly released. Notwithstanding that, the court refused to find, though requested so to do, that Sherman and Sutherland, in commencing and prosecuting the action, honestly believed that Sherman had a good cause of action against Galusha as set forth in the complaint; but on the contrary, found that the note and mortgage were given without consideration. Plain error was thereby committed. The evidence being undisputed that the claim made by Sherman was an honest claim, the court should have so found. That was the vital question on the subject of whether there was any consideration for the note and mortgage. It being undisputed that the supposed cause of action was released in consideration of the note and mortgage, the finding that they were given without consideration was directly contrary to the fact. The learned court, in another part of the findings, seems to have determined that Sherman did not have a cause of action in fact, and to have come to that conclusion because of the result of another action for damages brought against Galusha by a person circumstanced the same as Sherman, in regard to having eaten some of the alleged impure meat,--an action to which Sherman was not a party, and, obviously, by which he was not in any way legally affected. Under what theory the verdict in that case was evidence against Sherman on the fact, if it were a...