Milwaukee Trust Co. v. Van Valkenburgh

• Decision Date: 24 September 1907
• Citation: 132 Wis. 638,112 N.W. 1083
• Parties: MILWAUKEE TRUST CO. v. VAN VALKENBURGH ET AL.
• Court: Wisconsin Supreme Court

132 Wis. 638

112 N.W. 1083

MILWAUKEE TRUST CO.

v.VAN VALKENBURGH ET AL.

Supreme Court of Wisconsin.

Sept. 24, 1907.

Syllabus by the Judge.

All mere technical defects in pleadings, as regards insufficiency of statement, give way to the liberal rules for construction, where essential matters, not expressly alleged, are reasonably suggested to exist, and intended to have been included in the language used.

Mere ambiguities in pleadings which may be solved by construction are judicially remediable only by motion to make more definite and certain.

A pleading is not open to successful objection for insufficiency if it will reasonably admit of a construction which will sustain it in the light of all the facts, stated expressly or by reasonable inference; reasonable doubts in that regard being resolved in favor of, rather than against, the pleading.

Production by the holder, but not the party named as payee, of a negotiable promissory note, duly indorsed to such holder, raises a presumption that it was acquired by him for value before due, with all the then incidents thereof, such as a mortgage securing the same or coupons for future installments of interest.

In case of a promissory note secured by a mortgage on realty, the latter is an incident of the former and the transfer of the principal thing by an ordinary indorsement carries with it such incident enabling the owner of the indebtedness to enforce it without any formal assignment thereof.

A transfer of a note by indorsement thereon, expressly including the mortgage security and the interest, constitutes a good written conveyance of the mortgage and the interest coupon owned by the indorser and attached to the note.

Production of a note and coupon for interest thereon, but detached therefrom, by a person not named therein as payee, the note and coupon as well being in form payable to order, and the note being duly indorsed, but the coupon having no indorsement, raises a presumption that the holder became the owner of the note when the coupon was attached thereto, and formed a mere incident thereof, and so did not require any indorsement separately from that on the note.

A person who is trustee of a security for two persons, but assumes to be such only for one of them, having the legal title may enforce it. The beneficiaries are not necessarily parties to the action in that regard.

The purported execution of, or signature to, the indorsement or assignment of a promissory note, in the absence of a specific denial under oath of due execution or signature by the person so purporting to have signed or executed the same, is to be regarded as in accordance with the facts.

The rule last stated applies in an action whether the signature purports to be by a party thereto or otherwise.

Though the ordinary executive officer of a corporation, such as its president, does not, ex officio, have authority to bind the corporation by contract, in harmony with the general custom of conducting business he is presumed to have had such authority duly conferred upon him.

In case of a transfer by indorsement of commercial paper held by a corporation, the indorsement being in the name of the corporation by its president, and such transactions being within the scope of the ordinary corporate business, authority of the president in the matter is to be implied, and his act is binding on the corporation, whether he had authority in fact or not, as to any person acting upon the appearance of authority without knowledge or reasonable means of knowledge that actual authority did not exist.

Interest upon the due part of a mortgage indebtedness after judgment of foreclosure, and on the part not due at the date of the judgment after its becoming due, as well as upon all other recoveries in the action and upon tax liens necessarily paid by the judgment creditor for his protection, follows the rate fixed in the contract between the parties limited by the minimum legal rate. Sections 3164, 3165, St. 1898.

Appeal from Circuit Court, Milwaukee County; John C. Ludwig, Judge.

Action by the Milwaukee Trust Company, guardian, against Frank B. Van Valkenburgh and others. Judgment for plaintiff. Defendants appeal. Modified and affirmed.

The allegation in the complaint as to the corporate existence of plaintiff is in these words: “Plaintiff * * * is, and was at all times hereinafter mentioned, a Wisconsin corporation, doing business as such in the city of Milwaukee, county of Milwaukee, state of Wisconsin, and as such duly authorized to act as guardian.” The mortgage was given July 11, 1895, by defendant Frank B. Van Valkenburgh and his wife to the Wisconsin Trust Company as guardian of Fred W. Benjamin and Catherine C. Benjamin to secure payment by said Van Valkenburgh to said guardian of a promissory note of $20,000, made by said Van Valkenburgh, payable to the order of said guardian on the 1st day of September, 1905, with interest at the rate of 5 per cent. per annum payable on the 1st day of March, 1896, and semiannually thereafter, according to coupons attached thereto, numbered from 1 to 20 inclusive, of $500 each. The amount unpaid was the face of the note and the last coupon. The complaint was in the usual form. The allegation as to the transfer of the note, coupon and mortgage to the plaintiff was in these words: Said note was “for a valuable consideration, before the commencement of this action, duly assigned and transferred, together with the mortgage securing the same, to the Milwaukee Trust Company, as guardian of Catherine C. Benjamin; and said the Milwaukee Trust Company, as such guardian, is now the lawful owner and holder of both said note and said mortgage.”

There was a demurrer to the complaint for insufficiency which was overruled.

Defendant Frank B. Van Valkenburgh by verified answer admitted execution of the note and mortgage and failure in some respects to perform the conditions thereof, as alleged, and that plaintiff claimed to be a corporation and the guardian of Catherine C. Benjamin and as such to be the owner of such note and mortgage, and denied that the property covered by such mortgage was inadequate security for the mortgage indebtedness, and further denied, on information and belief, the other allegations of the complaint.

Defendant Emma W. Van Valkenburgh, by an unverified answer, denied generally the allegations of the complaint. Neither by the pleading nor by affidavit was the signature to the transfer of the note and mortgage or the execution of such transfer denied.

On the trial there was an objection to the introduction of the note in evidence, no ground being specified, which was overruled, and a like objection was overruled as to the coupon.

Plaintiff produced the note and coupon and they were received in evidence. The only written evidence of a transfer of the securities to the plaintiff was indorsed upon the back of the note and was in these words:

“For value received the Wisconsin Trust Co., Gdn. of C. C. Benjamin, hereby assigns and transfers the within note together with all interest and all rights under the mortgage securing the same, to the Milwaukee Trust Company, Gdn. of C. C. Benjamin, without recourse.

Dated at Milwaukee this 28th day of January, 1903. The Wisconsin Trust Co., Gdn. of C. C. Benjamin, by J. H. Van Dyke, Jr., V. Pres.”

The coupon when produced was separate from the note. It had no endorsement thereon. It was payable “to the Wisc. Trust Co., guardian, etc., or order * * * for an installment of interest due at the maturity” thereof upon a certain note of even date for the sum of $20,000. There was evidence of the substitution of the plaintiff for the Wisconsin Trust Company as guardian.

There were findings of the due making of the note, coupon and mortgage, as alleged, also of the discharge of the Wisconsin Trust Company as guardian of Fred C. Benjamin, he having become of age, also of the due appointment of plaintiff as guardian of Catherine C. Benjamin in place of the Wisconsin Trust Company, and of the due assignment and transfer before the commencement of the action of the note and mortgage to the plaintiff, and of its being the lawful owner and holder thereof. The amount found to be due on the note and coupon was $21,930.73. There were all other findings essential to a judgment of foreclosure. It was found that the realty was mortgaged “subject to existing leases” thereon. The conclusion of law authorized a judgment of foreclosure in the usual form and provided for a sale of the mortgaged premises. The judgment was in terms “that the premises subject to the mortgage described in the complaint and findings, to wit: All of lots,” etc., should be sold.

Frank B. Van Valkenburgh (Chas. A. Vilas, of counsel), for appellants.

Miller, Mack & Fairchild and W. F. Adams, for respondent.

MARSHALL, J. (after stating the facts as above).

The complaint as regards the corporate existence of plaintiff was sufficient on demurrer. The allegation that plaintiff was a Wisconsin corporation fairly suggested that it was a corporation organized and existing under the laws of the state of Wisconsin.

The liberal rule, which to a very great extent promotes the administration of justice, doing away with the otherwise obstructive efficiency of technical unmeritorious and so unprejudicial defects, supplies in a pleading all essential matters not expressly stated when, from the express statements, they may reasonably be supposed to exist and to have been intended by the pleader to be included in such statements. Miller v. Bayer, 94 Wis. 123, 68 N. W. 869;Kliefoth v. Northwestern Iron Co., 98 Wis. 495, 74 N. W. 356;Miles v. Mutual Reserve Fund Life Ass'n, 108 Wis. 421, 84 N. W. 159;Emerson v. Nash, 124 Wis. 369, 102 N. W. 921, 70 L. R. A. 326, 109 Am. St. Rep. 944.

Reasonable doubts respecting the pleader's purpose as to matters which the adverse party is fairly entitled to have solved to enable him with due consideration to adopt a course of action...