Tilton v. Horton
| Decision Date | 12 November 1931 |
| Citation | 137 So. 801,103 Fla. 497 |
| Parties | TILTON v. HORTON[*] |
| Court | Florida Supreme Court |
Commissioners' Decision.
Error to Circuit Court, Broward County; George W. Tedder, Judge.
Action by A. C. Tilton abainst Ralph A. Horton. To review a final judgment for the defendant, the plaintiff brings error.
Reversed.
Syllabus by the Court.
A plea of res judicata may obtain, where the second suit is between the same parties and based upon the same cause of action, not only as to every question properly raised by the pleadings but any issue which should have been determined in the same suit.
The third paragraph of section 1 of chapter 6907, Laws of Florida 1915 (section 4906, Comp. Gen. Laws 1927), authorizing any defendant in his answer to a bill in equity to state in short and simple form any counterclaim arising out of the subject-matter of the suit which might be the subject of an independent suit in equity against plaintiff, was in substance adopted from Federal Equity Rule 30 (28 USCA § 723), and should be construed in accord with the interpretations of federal courts, when such interpretation is not in conflict with the laws of this state.
The counterclaim referred to in the first part of Federal Equity Rule 30 (28 USCA § 723), section 4906, Comp. Gen. Laws 1927 like the set-off and counterclaim in the next clause, must be such as would be 'the subject of an independent suit in equity against' complainant; the only difference being that the first counterclaim must grow out of the bill while the second counterclaim or set-off need not.
Any equitable claim of defendant which grows out of 'the subject-matter of the bill' must be set up in defendant's counterclaim while the set-off or counterclaim not growing out of the subject-matter may be set up if the defendant wishes.
The cause of action pleaded in a counterclaim must be of equitable cognizance, and, like a cross-bill, must be connected with the subject-matter of the original bill otherwise it need not be pleaded.
Construing together the provisions of chapter 6907, Acts of 1915, and Federal Equity Rules 30, 31, and 33 (28 USCA § 723) which the said act adopts, the purpose apparently sought was to empower a defendant in any equity suit to set up any equitable counterclaim against complainant without the formality of a cross-bill, and if by counterclaim in his answer it must be stated 'in short and simple form.'
The reasons for a statute and rule requiring a defendant to plead his counterclaim only when it arose out of a claim 'which might be the subject-matter of an independent suit in equity against' complainant may be found embedded in our federal and state Constitutions which preserve the right of trial by jury in actions at law.
Section 3 of the Declaration of Rights, Constitution of Florida, and the Seventh Amendment to the Federal Constitution, are designed to preserve and guarantee the right of trial by jury according to the common law as known and practised at the time of the adoption of our Federal Constitution, and in neither case does it extend to equitable demands enforceable only in courts of chancery.
A defendant is not obligated to set up by his counterclaim in a chancery suit a cause of action cognizable at law, under said chapter 6907, but, when he does, he affirmatively waives his objection to the equitable jurisdiction and also his constitutional right to trial by jury.
Where a bill states a case entitling the complainant to equitable relief, if the proof fails to establish the averments of the bill with respect to the equitable relief sought, in consequence of which the prayer for an equitable relief is denied, the court is without jurisdiction to proceed further and determine separate and independent claims of legal rights between the parties, which claims of legal right would be cognizable in a court of law.
An order or decree may be treated as having been rendered when the chancellor pronounces in open court that which determines the issues in the suit, even though a final decree is not then entered in the sense that an execution or appeal may be based thereon.
Where a cause is dismissed without prejudice in open court, it is not incumbent upon the party so dismissed to assure himself that a proper final decree or judgment is entered embracing such dismissal.
Where a complainant's bill is dismissed by the chancellor for want of equity, and counterclaim embraced in the answer of defendant may be properly 'dismissed without prejudice,' whether it be an equitable or a legal claim.
Where the wording of a decree or judgment is susceptible of more than one meaning or construction, it must be so interpreted as to conform to the pleadings and proceedings in the cause as evidenced by the entire record.
Where a bill is dismissed by the chancellor as having no equity, and the counterclaim filed thereto by defendant is 'dismissed without prejudice,' it becomes immaterial as to whether the counterclaim was an equitable one and could have been litigated in the chancery suit.
Where a bill, or counterclaim filed thereto, is finally dismissed without prejudice, a decree entered thereon will not support a plea of res judicata, and the matter may again be heard and determined, as the intent and effect of such a reservation is to prevent it from operating as a bar to another suit.
Redfearn & Ferrell, W. H. Burwell, and J. A. Dewberry, all of Miami, for plaintiff in error.
McCune, Hiaasen & Fleming, of Ft. Lauderdale, for defendant in error.
This cause is here upon writ of error to the circuit court of Broward County. The final judgment to which the writ of error was taken is based upon an order of the court overruling a demurrer of plaintiff to defendant's plea of res judicata.
The plaintiff in error was plaintiff below, and defendant in error was defendant below.
The principal question presented for review is that:
Where a bill is filed by the maker of notes to have same canceled, and the defendant payee in his answer denying the equities of said bill sets up a counterclaim for a money judgment in his favor upon said notes, which had since the filing of the suit become due and payable, and the court, after taking testimony on the equities of the bill of complaint at the hearing, dismisses the cause 'With prejudice' to complainant and 'without prejudice to defendant,' and the final decree which is entered later dismissed the 'cause' without any express reference to counterclaim of defendant, does such final decree of the chancellor dismissing the 'cause' in the equity suit, without specifically mentioning the counterclaim, constitute res judicata, and thus effect an estoppel when set up by plea to a declaration in a subsequent action at law on the notes?
The facts are in substance that Ralph H. Horton as complainant below brought suit in equity to cancel seven promissory notes executed by him in favor of Tilton upon the ground of fraud, mistake, and misrepresentation; to which defendant filed his answer denying the allegations of the bill, and later by amended answer set up a counterclaim in which he asked for a money judgment in his favor on the notes in question, all of which had in the meantime become due and payable. No replication was filed to the counterclaim (for which purpose a complainant is allowed 20 days under section 4907, Compiled General Laws of Florida 1927; otherwise a default may be entered on such counterclaim). It appears, however, that the amendment was allowed by the court at the beginning of taking testimony, and the order of the chancellor dismissing the complainant Horton's cause may have made a replication immaterial, in the absence of a request by complainant at the time it was allowed to be filed.
At the close of complainant's testimony, the court stated that complainant had shown by his own testimony that he was not entitled to any relief; whereupon his counsel stated: 'If that is the case I would like to move for a dismissal of the bill.' To this counsel for defendant objected upon the ground that complainant in his bill states that he is able, willing, and stands ready to pay defendant such sum or sums of money as this court shall find equitably due him. The defendant then asked for judgment against Horton for the amount of principal and interest on the notes; also asked to submit testimony as to the amount of his attorney fees under the notes, which was not granted.
The plaintiff having 'rested,' the court asked defendant's solicitor: 'Has the defendant any testimony?' To which defendant's solicitor replied:
'The Court: I asked you if the defendant had any testimony to offer.
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