Buehrer v. Provident Mut Life Ins , 37 Ohio App. 250 ( 1930 )

On September 18, 1928, Henry W. Buehrer commenced an action in the court of common pleas to partition certain real estate owned by himself and his brother, the plaintiff in error, Daniel M. Buehrer — Daniel M. Buehrer, the Provident Life Trust Company of Philadelphia, and Charles Schroeder, Sr., also being named as defendants therein. The trust company held a mortgage on the property and filed a cross-petition in the action seeking its foreclosure, the amount claimed due being $5,100, with interest thereon at 8 per cent. per annum, to be computed and payable semiannually from February 2, 1928. To this cross-petition the defendant Daniel M. Buehrer filed an answer and cross-petition. In the cross-petition he alleged, among other things, that on February 17, 1925, the State Exchange Bank of Stryker, Ohio, brought an action in the court of common pleas of Williams county against himself and others to marshal liens upon the real estate sought now to be partitioned, and other lands owned by him; that the Provident Mutual Life Insurance Company, formerly the Provident Life Trust Company of Philadelphia, one of the defendants, on February 23, 1926, filed a cross-petition seeking a foreclosure of a mortgage on said lands, being the same mortgage sought now to be foreclosed in the partition suit, averring therein that "the interest due on August 2, 1925, evidenced by a note, had not been paid, and stated that by reason of the failure of Daniel M. Buehrer and Henry W. Buehrer to pay said interest, the conditions of the mortgage had been broken and that the entire amount owing on said principal note secured by said mortgage was, by reason thereof, due and that said insurance company elected to and did declare the whole amount owing on said mortgage to be due," and that on the contrary no interest was due on the note and mortgage and no default existed as to any payments to be made thereon; that publication of notice for certain nonresident defendants was made in a Bryan newspaper, wherein it was stated that the conditions of the mortgage had been broken, that the interest due thereon had not been paid, and that the defendants Buehrer had failed to pay the principal when due, whereas in truth and in fact they were not in default in any sum thereon; that the statements so made alleging a breach of the mortgage contract and a default in the payments due thereon were false, and were made wrongfully, intentionally, and without just cause. The cross-petition of Buehrer contains many other allegations, and particularizes the damages, amounting to $20,000, which he claims to have sustained by the statements so made by the insurance company, and he then alleges that the cross-petition of the insurance company was dismissed by order of the court on July 23, 1926.

It is further alleged that on July 8, 1927, the defendant Daniel Buehrer brought an action in the court of common pleas of Lucas county against the insurance company to recover damages for said wrongful acts, which action, on petition of the latter company, was removed to the United States District Court, where it was dismissed without prejudice on November 21, 1928. Daniel M. Buehrer, in his cross-petition, prays "that the court find the amount of damages owing him, and that the court impanel a jury to find the amount thereof and allow said amount as a counterclaim to the amount claimed by the insurance company, and that a judgment be entered for the balance owing to him, after allowing said counterclaim."

The Provident Mutual Life Insurance Company demurred to the cross-petition of Buehrer on two grounds only: First, said cross-petition does not state facts sufficient to constitute a cause of action; and, second, the action which is attempted to be stated therein was not brought within the time limited for the commencement of such an action.

This demurrer was sustained by the court of common pleas on the second ground thereof, the court finding that the cause of action stated in the cross-petition was barred by Section 11225 of the General Code. The plaintiff in error claims, first, that his cause of action is for breach of the mortgage contract and therefore not within the provisions of this section; second, that if his alleged cause of action is one for slander of title, then it is, "strictly speaking, an action for trespass upon real property and is governed by Section 11224 of the General Code;" third, if the cross-petition sets out a cause of action for slander, since the action removed to the United States court was commenced within one year and was dismissed not on the merits, and this cross-petition was filed within one year thereafter, the cause of action therein alleged is not barred by Section 11225, General Code; and, fourth, that if his cause of action is for slander of title, and barred in one year, then so much of his claim as does not exceed the claim of the insurance company may be set up by way of recoupment.

If we may say so without seeming to be facetious, it would seem that the statement of so many varying alternatives suggests that perhaps none of them is correct.

Section 11323 and Section 11324 of the General Code provide the causes for which a plaintiff may demur to a counterclaim, set-off, or defense, Section 11323 providing for a general demurrer on the ground that "on its face it is insufficient in law," and Section 11324 providing six specific grounds upon which a plaintiff may demur to a counterclaim or set-off.

The first ground of the demurrer under consideration is that the facts stated are not sufficient to constitute a cause of action, and is not based on any of the grounds specifically provided for challenging the sufficiency of the facts stated in the cross-petition as constituting a counterclaim. That the alleged cause of action is not the proper subject of a counterclaim may be waived, and since, in Ohio, a general demurrer attacks only the jurisdiction of the subject-matter, or the petition, as not stating facts sufficient to constitute a cause of action, a majority of the court feel that it may be questionable whether the demurrer here under consideration challenges the sufficiency of the cross-petition of the plaintiff in error as a counterclaim.

In our judgment the facts contained in the cross-petition alleging publication in a Bryan newspaper of the statements claimed to have been false, in conjunction with the special damages alleged to have been sustained thereby, do constitute a cause of action, but are insufficient as constituting a counterclaim to the cause of action of the insurance company. The latter company seeks to foreclose a mortgage on real estate given to secure an unpaid promissory note. The cause of action of plaintiff in error is based upon an alleged tort, not upon any condition or provision of the mortgage. It is not for an alleged breach of contract, but for special damages claimed to have resulted from the false and malicious published statements of the mortgagee. As we view it, the cause of action of plaintiff in error is founded upon an independent wrong, not arising out of or connected with the cause of action of the insurance company, and, this being so, even if, as claimed by plaintiff in error, there may be instances where a defendant may set up by way of recoupment, to the extent of the relief demanded by the plaintiff, a claim upon which an independent action or counterclaim seeking affirmative relief could not be brought because barred by the statute of limitations, the facts alleged in his cross-petition are of no avail for this purpose. Recoupment was the form of remedy provided by the common law, which the Code now recognizes and designates as a counterclaim. Timmons v. Dunn, 4 Ohio St. 680.

The cause of action of plaintiff is based upon an alleged false and malicious statement as to his title or interest in the real estate mortgaged to the insurance company, and falls within that branch of the law of libel and slander designated as slander of title, or slander of property. As said by Townshend in his Treatise on Slander and Libel (4th Ed.), page 112: "Slander of title is but a portion of that division of the law relating to wrongs by language which includes language concerning things."

Under the heading, "Slander of Property," Newell on Slander Libel (4th Ed.), page 195, Section 160, says: "There is a branch of the law of defamation generally known by the somewhat indefinite term ``slander of property.' It permits an action to be brought against any one who falsely and maliciously defames the property, either real or personal, of another, and thereby causes him some special pecuniary damage or loss. As in all other actions dependent upon special damage, there must be injury and damage; the injurious words falsely and maliciously spoken, and the damage, the consequent pecuniary loss to the party whose property is defamed. There can be no action except for the injury, the slanderous words, and no recovery except for special damages."

And in Section 161, this author says: "It makes no difference whether the matter complained of has been published orally or by writing, printing or otherwise, except as to the recovery which should be larger in case of publication in permanent form. The gist of the action is the special damage sustained."

In our opinion, Section 11225, General Code, which limits to one year the time within which actions for libel or slander may be commenced, applies to all actions so designated, whether relating to defamation of person or property. To hold otherwise would be to say that the Legislature intended to and did provide different limitations as to defamation of person, of personal property, and of real estate. Since it is apparent that slander of personal property is not governed by Section 11224, paragraph 1, which plaintiff in error claims applies to the action set up in his cross-petition, it would seem absurd to say that Section 11225 applies to defamation of person, Section 11224 to defamation of real estate, and neither of them to defamation of personal property. It seems apparent, also, that slander of title of real estate is not a trespass, and therefore not governed by paragraph 1 of Section 11224, General Code, because a trespass on real estate is an entry upon another's possession unlawfully and with force.

The claim that the action in the United States District Court, having been dismissed not on the merits, and this action having been commenced within one year thereafter, avoids the effect of Section 11225 is not well taken, since the record shows that the action in the United States District Court was dismissed without prejudice on the application of the plaintiff in error. Siegfried v. N.Y., L.E. W. Rd. Co.,50 Ohio St. 294, 34 N.E. 331.

From what has been said it follows that the judgment of the court of common pleas will be, and is, affirmed.

Judgment affirmed.

WILLIAMS and RICHARDS, JJ., concur.