Martin v. Setter
| Decision Date | 20 November 1931 |
| Docket Number | No. 28339.,28339. |
| Citation | 239 N.W. 219,184 Minn. 457 |
| Parties | MARTIN et al. v. SETTER et al. |
| Court | Minnesota Supreme Court |
Appeal from District Court, Dakota County; W. A. Schultz, Judge.
Action by Charles E. Martin and another against Gladys E. Setter and another. Judgment for the defendants, and the plaintiffs appeal.
Reversed, and cause remanded with directions.
D. L. Grannis, of South St. Paul, and Albert Schaller, of St. Paul, for appellants.
Sterling, Converse & Spence, of St. Paul, for respondents.
Plaintiffs appeal from a judgment rendered in defendants' favor for $8,845.19. There was a motion for a new trial which presented the questions now raised by the assignments of error. A brief statement of the main facts is necessary. In August, 1925, defendant A. Milton Setter and plaintiffs entered a tentative agreement to trade farms, Setter owning 1,600 acres in Canada with equipment of horses and machinery, and plaintiffs owning 360 acres partly in Dakota and partly in Scott counties, this state, with a dairy herd, horses, and machinery. In the deal one Denny was plaintiffs' agent and one A. J. Rieger was agent of defendant Mr. Setter. Before the transaction was reduced to writing defendants married. After plaintiffs had seen the Canada farms, and on September 3, 1925, the trade was consummated by the signing of another contract, Mrs. Setter not signing. Mr. Setter was to reduce the incumbrances on the Canada farms to a certain sum, was to pay overdue interest thereon and unpaid taxes, but was unable to do so; and on February 23, 1926, by a writing signed by all the parties to the suit, the contract of September 3, 1925, was modified, and moneys were advanced by plaintiffs to permit Setter to accomplish what he agreed to do. Plaintiffs were also directed to transfer the property to Mrs. Setter in place of Mr. Setter. The moneys advanced amounted to $5,932.94, for which defendants gave their note secured by mortgage upon the property which they received. There was a default in the payment of this note and this action was brought to obtain possession of the property in order to foreclose. Defendants counterclaimed for $45,000 damages for alleged misrepresentations, chiefly as to the market value of the Dakota and Scott county farm and the feasibility of draining a pond thereon. There was a jury trial and a verdict rendered June 29, 1928, for $17,500 in favor of defendants. Thereafter plaintiffs were permitted to interpose a supplemental reply which pleaded as a defense to the counterclaim that defendants, after instituting an action to recover damages of their agent A J. Rieger for the identical misrepresentations plaintiffs were charged with in this action, by which defendants were induced to trade properties with plaintiffs, settled said cause of action and dismissed it with prejudice and fully released Rieger from every liability growing out of the misrepresentations. In January, 1930, the cause came again for trial, and, of course, a different jury was impaneled to try the issue raised by the supplemental reply. The jury found in favor of the Setters. A motion for a new trial was made by plaintiffs alleging errors on both trials including the contention that they were entitled to a directed verdict. The verdict was reduced to $7,500, a new trial was denied, and judgment entered. As we understand defendants, there was no defense to plaintiffs' cause of action unless defendants prevailed to some extent upon their claim for damages because of misrepresentations inducing the trade.
Since we have concluded that judgment notwithstanding the verdicts must be ordered for plaintiffs, it will not be necessary to consider assignments of error not determinative of that result. Plaintiffs at the conclusion of all the testimony moved for a directed verdict "on the ground that the release which has been introduced in evidence was conclusive that by releasing Mr. Rieger the plaintiffs in this case have been released." In this connection we must also consider the errors assigned upon the reception of parol evidence to vary or contradict the legal effect of the release. There can be no question but that the tort for which defendants claimed damages was misrepresentations inducing the trade of the farms and equipments mentioned. Comparing the allegations of the answer in this action with the allegations of the complaint in the action against Rieger, in the settlement of which the release and stipulation for dismissal on the merits were given, there is no escape from the conclusion that the cause of action asserted by defendants was one and the same in both suits. Rieger and plaintiffs participated in the tort which caused the damages to defendants. Defendants do not question the authority of their attorneys to enter this stipulation with Rieger's attorney in the action brought against him: This stipulation was signed by the attorneys of the respective parties. In the release dated June 5, 1928, A. Milton Setter, after reciting the same consideration as in the stipulation, does "hereby remise, release and forever discharge the said Arthur James Rieger, his heirs, executors and administrators, of, and from all, and all manner of, action and actions, cause and causes of action, suits, debts, dues, sums of money, accounts, reckonings, bonds, bills, specialties covenants, contracts, controversies, agreements, promises, variances, trespasses, damages, judgments, extents, executions, claims and demands whatsoever, in law or in equity, which against Arthur James Rieger I, the said A. Milton Setter, ever had, now have, or which my heirs, executors or administrators hereafter can, or may have, by reason of any matter, cause or thing whatsoever from the beginning of the world to the day of the date of this release." This was signed by A. Milton Setter and acknowledged on July 16, 1928. This stipulation and the release had been held by defendants' attorneys from their dates and had evidently been agreed upon by the attorneys of the respective parties. A few days after July 16, 1928, defendants' attorneys delivered them to Rieger's attorney and turned over to defendant the $4,000 note and the release of the property securing the same. No doubt by these instruments the cause of action defendants had or asserted against Rieger was settled and he was forever discharged. And it would follow that any other person whose acts caused or participated in the tort which damaged defendants was also discharged. Hartigan v. Dickson, 81 Minn. 284, 83 N. W. 1091; Borchardt v. People's Ice Co., 106 Minn. 134, 118 N. W. 359; Almquist v. Wilcox, 115 Minn. 37, 131 N. W. 796; Davis v. Moses, 172 Minn. 171, 215 N. W. 225. That such is the law is not disputed by defendants, but defendants, over objections, were permitted to prove by Setter that he did not intend to settle or compromise his cause of action, but that what he received for the settlement and release from Rieger was to apply upon his cause of action against plaintiffs. Was parol evidence competent to vary or contradict these documents? This is the decisive and important question in the case.
This court, in common with courts of most every state and eminent text-writers such as Chamberlayne, Greenleaf, Jones, and Wharton, has stated that "The parol evidence rule does not ordinarily apply between strangers to the instrument or between a party and a stranger." 2 Dun. Minn. Dig. § 3396, and cases cited in note 75. But Dunnell also states it does apply "to a stranger who seeks to enforce rights based on the instrument." And in Minneapolis, St. Paul & S. Ste. Marie Ry. Co. v. Home Ins. Co., 55 Minn. 236, 56 N. W. 815, 816, 22 L. R. A. 390, referring to the rule first stated it was said: In the instant case the right to the defense asserted originated by law in the discharge of Rieger by virtue of the release. See, also, Lawton v. St. Paul Permanent Loan Co., 56 Minn. 353, 57 N. W. 1061. In speaking of the rule against varying written contracts by parol this language, here applicable, is used in Current v. Muir, 99 Minn. 1, 108 N. W. 870: ...
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