Kowalke v. Milwaukee Elec. Ry. & Light Co.

• Decision Date: 22 June 1899
• Citation: 103 Wis. 472,79 N.W. 762
• Court: Wisconsin Supreme Court
• Parties: KOWALKE v. MILWAUKEE ELECTRIC RAILWAY & LIGHT CO.

103 Wis. 472

79 N.W. 762

KOWALKE

v.MILWAUKEE ELECTRIC RAILWAY & LIGHT CO.

Supreme Court of Wisconsin.

June 22, 1899.

Appeal from circuit court, Milwaukee county; D. H. Johnson, Judge.

Action by Anna Kowalke against the Milwaukee Electric Railway & Light Company. From a judgment for plaintiff, defendant appeals. Reversed.

On October 26, 1896, plaintiff was injured by jumping from defendant's street car in an emergency, so as to make its liability for injuries probable. On the day following, the plaintiff's husband applied to defendant for settlement of the damage, stating that she was pregnant. Accordingly the defendant's surgeon secured the attendance of her family physician, who made a cursory examination, which disclosed only slight bruises, and soreness naturally resulting therefrom. They also learned that she was having a slight uterine hemorrhage, and the question of her pregnancy was raised, and an examination to ascertain that fact proposed by defendant's surgeon. She repudiated the fact of pregnancy, stating that she was sure, from certain symptoms, that nothing of the sort existed, and refused peremptorily to submit to examination either by the two physicians or by her own family physician. She stated the result of the transaction on this subject: “When this release was made, I had some bruises and was flowing. I was not positive I was pregnant. I told them I was not in the family way. The doctors asked me how I felt, and went all over the case, and asked me a long time how I felt; and at last it was agreed they were not sure I was in the family way, and they agreed that Dr. Golley should take care of me. The only thing that was known about my condition was that I was flowing, after I had stated to them I was not in family way, and that I had these pains and bruises and stiffness. That was all I knew about it.” The defendant's surgeon returned at evening, when the plaintiff's husband was at home, and then a settlement was negotiated, and the plaintiff, with her husband, signed a full release of the defendant “of all claims and demands for damages or otherwise which I now have or can have by reason of jumping from [[[described car].” Plaintiff's hemorrhage continued intermittently until about the 8th of November, when she suffered a miscarriage. She was treated by Dr. Golley and his assistant throughout, and his bill paid by the defendant. Without prior communication with defendant, the plaintiff on March 4, 1897, commenced this suit, which came to trial May 2, 1898. Plaintiff's counsel, at the opening of the trial, waived all claim for damages by reason of expense incurred for care, medicine, surgical attendance, nursing, and loss of service, the same being conceded to belong to the husband. The parties stipulated in open court to waive jury trial as to all questions except the amount of damages, and a finding was accordingly made by the court to the effect that at the time of settlement both plaintiff's and defendant's physician believed she was not pregnant and that her injury was slight, that the mutual mistake was made in good faith, and that the settlement was made by reason of said mutual mistake, and without fraud or intentional misrepresentation on the part of either. The jury found the damages at $2,900, and the court set aside and ignored the settlement and release, and entered judgment for that amount, from which this appeal.Miller, Noyes, Miller & Wahl, for appellant.

Fred S. Fish, for respondent.

DODGE, J. (after stating the facts).

The circuit court's finding of entire absence of anything like fraud perpetrated by the defendant or its representative upon the plaintiff is certainly not antagonized by the preponderance of the evidence. Indeed, the conduct of the defendant's physician seems to have been in accordance with the most scrupulous rules of professional and contractual ethics. He refrained from visiting the plaintiff for examination until he had secured, at the company's expense, the attendance of her regular physician. He at no time assumed to treat her, or intrude upon the relations between her and her attending physician. He refrained from any negotiation for settlement until he could meet her in company with her husband. The judgment, however, proceeds exclusively upon what is termed by the court below “a mistake of fact,” which is predicated upon the fourth finding, that both she and the defendant's physician “believed” she was not pregnant. To formulate an accurate and practically applicable definition of the mistake of fact which will warrant rescission of a contract, has been apparently well-nigh the despair of law writers. Indeed, no definition or general rule has been invented which is sufficient or accurate, except by immediately surrounding it with numerous exceptions and qualifications more important than itself. This is not surprising, in view of the fact that the whole doctrine is an invasion or restriction upon that most fundamental rule of the law, that contracts which parties see fit to make shall be enforced, and in view of the further consideration that one or both of the parties is often, if not usually, ignorant or forgetful of some facts, thoughtfulness of which might vary his conduct. The most philosophical definition we have found is that presented by Pom. Eq. Jur. § 839: “An unconscious ignorance or forgetfulness of the existence or nonexistence of a fact, past or present, material to the contract.” This definition contains several elements, each of which, as above suggested, must be explained and qualified in its practical application. Thus, the ignorance must be unconscious; that is, not a mental state of conscious want of knowledge whether a fact which may or may not exist does so. Kerr, Fraud & M. p. 432. This idea is involved in, and furnishes a reason for, the exception pointed out by Dixon, C. J., in Hurd v. Hall, 12 Wis. 112, 127, on authority of Kelly v. Solari, 9 Mees. & W. 54, viz.: Where a party enters into a contract, ignorant of a fact, but meaning to waive all inquiry into it, or waives an investigation after his attention has been called to it, he is not in mistake, in the legal sense. These limitations are predicated upon common experience, that, if people contract under such circumstances, they usually intend to abide the resolution either way of the known uncertainty, and have insisted on and received consideration for taking that chance. Akin to the rule that the ignorance must be unconscious, though going still further as an exception, is the other rule, that ignorance must not be due to negligence, although there be no actual suspicion with reference to the fact in question. Pom. Eq. Jur. § 856; Kerr, Fraud & M. p. 406; Hurd v. Hall, 12 Wis. 126;Conner v. Welch, 51 Wis. 431, 8 N. W. 260. The last case is a good illustration. A mortgagee took a new mortgage, and releasedan old one, on the understanding that his new lien took the place of the old, in ignorance of existence of a subsequent judgment against the mortgagor. The court held that, because he had some knowledge of the latter's embarrassed condition, it was negligence not to have investigated as to judgments, and refused, notwithstanding the mistake, to rescind the transaction and reinstate his former lien. Passing the requirement that the fact as to which mistake is made must be either past or present,--for it is obvious that the coming into existence of any future fact must at the time of contracting have been understood to rest in conjecture, and the contingency thereof to have been assumed by both parties,--another essential element of the definition is that the fact involved in the mistake must have been as to a material part of the contract, or, as better expressed by Beach, Mod. Eq. Prac. § 352, an intrinsic fact; that is, not merely material in the sense that it might have had weight if known, but that its existence or nonexistence was intrinsic to the transaction,--one of the things actually contracted about. As, in the familiar illustration of the sale of a horse, the existence of the horse is an intrinsic fact. Another partial expression of this requisite, adopted by Pom. Eq. Jur. § 856, is as follows: “If a mistake is made as to some fact which, though connected with the transaction, is incidental merely, and not a part of the very subject-matter, or essential to any of its terms, or if the complaining party fails to show that his conduct was in reality determined by it, in either case the mistake will not be ground for relief, affirmative or defensive.” The last part of this statement is adopted in Klauber v. Wright, 52 Wis. 303, 308, 8 N. W. 893;Grymes v. Sanders, 93 U. S. 55, 60.

Some illustrative cases of this aspect of the subject may serve to elucidate. The damaged condition of a ship at sea, as to which both parties to her sale are ignorant, held merely a collateral circumstance, and not an intrinsic fact. Barr v. Gibson, 3 Mees. & W. 390. Financial condition of a debtor is not intrinsic to a compromise and release of his debt, so that mistake thereon will justify rescission. Dambmann v. Schulting, 75 N. Y. 55, 63. Ignorance of declaration of peace, greatly enhancing value of merchandise, will not justify rescission of sale. Laidlaw v. Organ, 2 Wheat. 178. Sufficiency of security...