Hanson v. Skogman
| Decision Date | 10 October 1905 |
| Citation | 105 N.W. 90,14 N.D. 445 |
| Court | North Dakota Supreme Court |
Appeal from District Court, Ransom county; Lauder, J.
Action by Levi B. Hanson against Joseph E. Skogman. Judgment for defendant, and plaintiff appeals.
Reversed.
Judgment set aside and judgment entered for defendant, with costs. Plaintiff recovered his costs upon appeal.
Charles S. Ego and Guy C. H. Corliss, for appellant.
The tort was not connected with the subject of the action so as to make it the subject of a counterclaim. Braithwaite v Akin, 3 N.D. 365, 56 N.W. 133; section 5274, subdivision 1, Rev. Codes 1899.
The property was turned over to the plaintiff as security in the nature of a pledge, with the condition that he might sell, if he could get enough to pay the debts secured, and plaintiff was not to be accountable for the use, nor defendant for the keep, of the horses. Defendant must comply with the conditions of the pledge if he would get possession, or sue in equity for a redemption. Plaintiff has the right to sue on the note and still retain possession of the horses. Wilson v. Burhans, 71 N.W. 879.
Rourke Kvello & Adams, for respondent.
That a counterclaim has been filed in an action in which it is not permissible is not a statutory ground for demurrer; it must be met by a motion to strike out or by objection to evidence under it. Howlett v. Dilts, 30 N.E. 313.
Conversion of horses, for which a note was given, and for the judgment of which they were pledged, was a proper subject of counterclaim in a suit on the note. Ainsworth v Bowen, 9 Wis. 348; Rush v. First Nat. Bank, 71 F. 102, 17 C. C. A. 627; Hyman v. Jockey Club Co., 48 P. 671; Paxton v. Vincennes Mfg. Co., 60 N.E. 583; First Nat. Bank v. O'Connell et al., 51 N.W. 163.
A statute authorizing counterclaims should be liberally construed. First National Bank v. Parker, 28 Wash. 234, 92 Am. St. Rep. 828, 68 P. 756.
The defendant's counterclaim was "connected with the subject of the action," and proper. Gordon v. Bruner, 49 Mo. 570; Vilas v. Mason, 25 Wis. 310; Smith v. Fife, 2 Neb. 10; Goebel v. Hough, 26 Minn. 252; Littleman v. Coulter, 7 N.Y.S. 1; First Nat. Bank v. Parker, 28 Wash. 234, 92 A. S. R. 828.
A motion for a new trial is not available procedure to reach defects in pleading. Ross v. Wait et al., 51 N.W. 866; Mason et al. v. Austin, 46 Cal. 385; Jacks v. Buell, 47 Cal. 162; Spelling, New Trial & App., vol. 1, section 6.
Action upon a promissory note for $ 135, dated May 20, 1902, and due October 1, 1902, with interest at the rate of 12 per cent per annum. The note was given by defendant to one Banish in payment for two horses, and was transferred to the plaintiff in due course. The answer consists of three paragraphs. The first admits the execution and transfer of the note and its nonpayment, and alleges that at the maturity of the note the defendant delivered the horses purchased into the possession of the plaintiff, upon an agreement that he might keep and use them until the spring of 1903, at which time the defendant might again have them by paying his note in cash or delivering bankable paper; that he has not been able to make said payment; that plaintiff still retains possession of the horses, and has refused and still refuses to surrender the same to the defendant--by reason of which facts he alleges that "the original contract of purchase and sale of said horses has been wholly canceled and rescinded." In the second paragraph the defendant alleges as a counterclaim, among other things, that he executed a mortgage upon the horses purchased to secure the note in suit; that the plaintiff wrongfully took possession of said horses and converted them to his own use, and that the value of the use is $ 1.50 per day or $ 500 in the aggregate. The third paragraph, also pleaded by way of counterclaim, in its allegations does not differ from, and is a mere repetition of, the preceding paragraph, except that it makes no reference to the mortgage and alleges the value of the horses to have been $ 150. Both paragraphs allege that the plaintiff converted the horses. The answer concludes with a prayer for the return of the horses, and demands damages for their detention, or, in case a delivery cannot be had, for "$ 150, the value thereof, besides the sum of $ 500 for their wrongful detention, for costs and disbursements, and further relief." The plaintiff demurred to the second and third defenses and counterclaims upon the ground that the "pretended counterclaims do not arise from either of the causes or sources enumerated in section 5274, Revised Codes." The demurrer was overruled. A trial was had to a jury, and a verdict was returned for defendant for $ 85. Plaintiff moved for a new trial upon a statement of the case, which motion was denied, and judgment was entered on the verdict. Plaintiff has appealed from the order denying his motion for a new trial and also from the judgment.
It is urged that the court erred in overruling the demurrer. In our opinion no error was committed. The second paragraph of the answer alleged, in substance, that the note in suit was secured by a chattel mortgage upon the horses for which the note was given, and that the plaintiff converted the horses so mortgaged to his own use. This states a cause of action in defendant's favor and one which we think may be asserted as a counterclaim in the action upon the note under subdivision 1, section 5274, Revised Codes 1899, which authorizes the defendant to counterclaim upon "a cause of action arising out of the contract or transaction set forth in the complaint as the foundation of the plaintiff's claim or connected with the subject of the action." Courts and text writers have expended much time and learning in attempting to define the meaning of the word "transaction" and of the phrase "subject of action," as used in this statute, which is common to many states, and, it must be confessed, without marked success. Bliss on Code Pleading, section 371, in referring to this provision, says: "Three classes of counterclaims are here provided for: First, a demand existing in favor of the defendant and against the plaintiff, which arises out of the contract upon which the plaintiff has based his action; second, a demand so existing, which arises out of the transaction--a broader term than contract--upon which the plaintiff has based his action; and, third, a demand so existing which need not necessarily arise out of either the contract or the transaction involved in the action, but is sufficient if it is connected with the subject of the action." The "transaction" upon which the plaintiff's action is based included the chattel mortgage as well as...
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