Johnson v. Curl , 147 Or. 530 ( 1934 )

Petition for rehearing denied July 24, 1934 ON PETITION FOR REHEARING (34 P.2d 975) The appellant, C.C. Curl, has filed a petition for rehearing, assigning two grounds for requesting it, as follows:

"I. The appellant's answer being within the pale of equitable jurisdiction, and the respondent having failed to object to the equitable jurisdiction, and having prayed for equitable relief, the trial court erred in dismissing the equitable cross-bill of the appellant.

"II. That the trial court erred in failing to hold that a partnership existed between the appellant and respondent and that the promissory note in suit was given to evidence a partnership obligation, if anything, for that reason was without consideration and void as to defendant."

In support of his first contention the appellant charges that this court based its decision on Cripe v. Wade, 123 Or. 111 (261 P. 72), and ignored Hudson v. Goldberg, 123 Or. 339 (262 P. 223), and Bank of Freewater v. Hyett, 137 Or. 193 (1 P.2d 1113).

In the case at bar the plaintiff in his reply did not allege any facts necessitating the interposition of a court of equity. The prayer of the reply, however, is as follows:

"Wherefore, having fully replied to defendant's answer on file herein, plaintiff prays for judgment as in plaintiff's complaint on file herein, and for plaintiff's costs and disbursements of this suit, and for such other and further relief as pertains to equity and good conscience."

Because the latter part of this prayer is "for such other and further relief as pertains to equity and good conscience", it is contended by petitioner that the trial court should have disposed of the entire cause as a suit in equity, instead of dismissing defendant's answer in so far as it sought equitable relief and entering a judgment at law.

In our former opinion in this case we pointed out that counsel for the defendant, petitioner here, at the commencement of the trial stated that "it is agreed that the equitable phase of the case and the law action will all be tried out together". This clearly indicates that the plaintiff had not abandoned his action at law and that counsel for the defendant so understood plaintiff's position.

A short review of the two cases which counsel now contend we ignored in our former opinion will demonstrate their inapplicability to the situation here.

In Hudson v. Goldberg, supra, the plaintiff in his complaint alleged that he and the defendant had entered into a contract whereby the plaintiff was to purchase certain medical remedies and was to be given the exclusive right to manufacture and sell the same in a certain designated territory; and that pursuant thereto the plaintiff had executed and delivered to the defendant his promissory note in the sum of $2,500, which was not yet due, and had thereafter borrowed sums of money from the defendant, for which he had given shares of certain corporate stock as security. The complaint then stated that the defendant had breached the terms of the contract to be performed by him, resulting in damages to the plaintiff. The prayer of plaintiff was for a cancellation of the agreement, for an order restraining the defendant from disposing of the promissory notes and collateral securing the same, for the delivery of said notes by the defendant to the plaintiff, and for other relief.

To this complaint the defendant filed an answer in which he set forth the contract between himself and the plaintiff, the execution and delivery of a note for $2,500 by the plaintiff to the defendant, the securing of the same by a mortgage on certain real property, the execution of other notes for money borrowed and the securing of the same, also the delivery of a stock of goods by the defendant to the plaintiff in an amount exceeding $12,000 in value for the purpose of permitting the plaintiff to sell the same and account to the defendant for the proceeds thereof. The answer averred that no accounting had been made by the plaintiff to the defendant.

The defendant for relief prayed that the plaintiff be required to account to him for all goods received, that plaintiff be restrained from disposing of the real property, and that the defendant recover from plaintiff a sum in excess of $11,000.

On the trial of the case the court entered a decree in favor of the defendant for his costs and disbursements, from which decree the plaintiff appealed. It is therefore obvious that the nature of that proceeding was altogether different from that of the case at bar. There, equity was invoked by the plaintiff in the first instance, and the defendant by the allegations of his answer also set forth facts which brought his defense and counter-claim within the cognizance of a court of equity.

In Bank of Freewater v. Hyett, supra, the plaintiff commenced an action on two promissory notes executed and delivered by the defendants Hyett, payable to the plaintiff. The defendants Hyett caused to be brought into the case as party defendants C.A. Crowe and David Harris. In their answer the Hyetts set forth the transactions between themselves and the plaintiff resulting in the execution by the Hyetts of the notes sued upon by the plaintiff, and other dealings growing out of the transactions above referred to, whereby a note in the sum of $2,400 was given by them to the plaintiff bank and by said bank transferred to the defendants Crowe and Harris.

The trial in the lower court resulted in a decree canceling all the notes above mentioned. On appeal to this court the bank and the defendants Crowe and Harris as appellants in their brief requested that the decree of the circuit court be reversed and one entered here in favor of the plaintiff on the $3,000 note and in favor of the defendants Crowe and Harris on the $2,400 note. No objection was made by the respondents to the jurisdiction of this court to enter such judgment in the event that the decree of the trial court should be reversed. Moreover, this court, in determining the questions presented on appeal, did not hold that the facts alleged in the answer were insufficient to invoke the jurisdiction of equity, but, having fully disposed of any defense which the defendants Hyett might have had to the action on the $3,000 note, on other grounds, entered thereon a judgment against them and in favor of the plaintiff.

Returning now to the facts in the case at bar, we note that the plaintiff upon filing his complaint on the law side of the court caused a writ of attachment to be issued and certain real and personal property to be attached.

On June 13, 1933, the circuit judge notified counsel for the litigants that in his opinion the facts as set forth by the defendant did not entitle the latter to equitable relief and that he would consider the matter alleged by the defendant "as an answer at law"; also that plaintiff was entitled to judgment as prayed for in his complaint. Pursuant to and in accordance with the announcement that the defendant should not have equitable relief and that the plaintiff should have judgment for the amount prayed for, counsel for plaintiff served upon one of the attorneys for the defendant separate proposed findings of fact and conclusions of law in relation to both the equitable and the legal aspects of the proceeding.

On July 10, 1933, more than two weeks after these proposed findings of fact and conclusions of law were served upon the defendant's attorney, the court signed the proposed findings of fact and conclusions of law regarding the equitable aspect of the case and entered a decree in accordance therewith, dismissing the answer in so far as it involved an equitable defense, and on the same day signed the proposed findings of fact, conclusions of law and judgment based on the allegations of the complaint. The judgment provided for the sale of the attached real and personal property.

The record fails to disclose that defendant's counsel objected to this procedure by the trial court, although they had ample notice thereof from the written opinion of the trial judge, and further knowledge from the submission of the proposed findings of fact and conclusions of law to which attention has been directed.

An attachment is a special auxiliary remedy, a creature of the statute, and belongs exclusively to a court of law:Fischer v. Gaither, 32 Or. 161 (51 P. 736); Spores v. Maude,81 Or. 11 (158 P. 169). The procedure relating to the procuring of a lien and the enforcement thereof is well defined by statute and by prior decisions of this court. The plaintiff was entitled, when the trial court found that there was no merit in the defendant's answer, to the entry of judgment in his favor, with provision for the sale of the attached property.

In view of the record in this case, the trial court, in our opinion, followed the correct procedure when it dismissed defendant's attempted equitable defense and thereafter entered judgment in favor of the plaintiff: § 6-102, Oregon Code 1930. As already pointed out, the testimony in relation to both the attempted equitable defense and the action at law was heard at the same time. No objection was made to the suggestion of the trial court that the answer theretofore filed be considered, in so far as applicable, as an answer in the law action; nor was any request thereafter made by the defendant for permission to file an amended answer or to offer additional testimony.

The plaintiff did not submit the entire controversy to a court of equity by the use of certain language in the prayer of his complaint, hereinabove mentioned. The language relied upon by petitioner in that respect was mere surplusage, as there were no allegations in plaintiff's complaint or reply warranting the court to grant him equitable relief.

The defendant appealed from both the decree and the judgment, and in our former opinion we held that he had failed to allege or prove facts bringing the controversy within the cognizance of a court of equity. We adhere to that view of the matter. The conclusion we here reach is not in any wise in conflict with the cases on which the petitioner relies and which have at some length hereinbefore been reviewed.

Inasmuch as there was sufficient competent evidence to sustain the findings of fact in the law action, we are precluded from re-examining the testimony to determine whether or not the evidence preponderated in favor of the plaintiff or the defendant.

What we have hereinabove said obviates the necessity of considering the petitioner's second ground for asking a rehearing.

The petition is denied.

RAND, C.J., and BEAN and CAMPBELL, JJ., concur.