Ryan v. Berger , 256 Wis. 281 ( 1949 )

Plaintiffs appeal from an order denying their motion for summary judgment. The action was commenced April 29, 1949, and the order was entered July 19, 1949. The complaint, verified by Clifford L. Curran, one of plaintiffs' attorneys, alleges the sale of their farm to defendants, who went into possession some time before December 1, 1948, pending clearing of title. While they were thus in possession, and before title passed, defendants informed the plaintiffs that defendants might have a claim against them for misrepresentations concerning the property. Plaintiffs denied the misrepresentations but left $1,000 in escrow with Genrich Terwilliger, attorneys. The complaint then alleges that the money was to be held for fifteen days from December 1, 1948, and if defendants did not start suit for misrepresentation during that time, time being of the essence, the money was to be sent by the escrow agents to Leicht Curran, attorneys for plaintiffs. No such suit was commenced within the time stated, although about December 1, 1948, the defendants told Genrich Terwilliger that they intended to bring suit and directed them to retain the deposit. The complaint ends with a demand for the delivery of the escrow money to the plaintiffs.

The answer admits the essential allegations of the complaint except it specifically denies any agreement that the deposit should be held for fifteen days only and should then be released unless defendants had commenced their action.

The counterclaim is for damages alleged to have been sustained because of fraudulent misrepresentations by plaintiffs.

After the action was begun, Genrich Terwilliger paid the aforesaid $1,000 into court and the principal parties have stipulated that the action may be dismissed as to them.

After issue was joined Mr. Curran, as attorney for the plaintiffs and as one knowing the facts, made an affidavit in support of a motion for summary judgment in plaintiffs' favor both upon the complaint and the counterclaim. To it he attached a letter dated December 2, 1948, designated as Exhibit "A," and a letter dated November 13, 1948, designated as Exhibit "B." Exhibit "A" reads as follows:

"2d December, 1948.
"Genrich  Terwilliger,
"Attorneys at Law,
"Wausau, Wisconsin
"Attn.  Emil Wakeen
"Dear Emil:

"In re: Berger-Ryan Matter. "Just a line to inform you that Berger yesterday signed the State Bank mortgage, and we received our $8,000. The abstracts are still at the register of deeds office, so I cannot inform you as to costs yet. We placed on record yesterday the deed from Ryan to Berger, the satisfaction of the Fischer mortgage, the State Bank mortgage, and the letters of administration of Fred Winter.

"Berger's deed will be sent directly to him by the register of deeds after it is recorded, the abstract and the State Bank mortgage will be sent to the State Bank, the bill and other papers will be returned to us, and at that time I will let you know what the charges are.

"I succeeded in getting in touch with Ryan immediately about removing their furniture, as Mr. Berger was insistent it be taken out right away. They left Chicago last night and are here this morning, and out to the farm removing the furniture now. I was unable to bring the question of the sale of certain chickens to a point; but trust that we will get that worked out in the next few days. Whether there will be any argument on furniture, or not I am sure I don't know, but we will have to wait and see what happens.

"My understanding now is that you will mail us $2,000 of the money held in escrow by you at once, and will hold $1,000 for fifteen days from yesterday, and if Berger does not start suit for misrepresentation in regard to cows, or well within those fifteen days, that money is to be sent to us,

"Best regards.
                                           "Yours truly,
"CLC:mz                                  Leicht  Curran"

Exhibit "B" is in the form of a letter signed by plaintiffs and defendants and sets forth their agreement concerning the terms of the sale. It describes the property and the price and provides that part of the purchase price is to be raised by a bank mortgage and that various portions of the sum are to be paid to divers persons. It was executed before the dispute concerning misrepresentation arose and makes no reference to such a possibility nor to the escrow. It includes a statement that the defendants have used their own judgment in making the purchase and have not relied upon the representations of the plaintiffs. Plaintiffs submit that the complaint states a cause of action for the recovery of a gratuitous conditional deposit made by plaintiffs for the benefit of defendants who are third-party beneficiaries so that defendants' allegation that they did not agree to the conditions of the deposit is immaterial and constitutes no defense. Plaintiffs' brief points out that the defendants did not deny that the deposit was without consideration.

Plaintiffs did not plead that the deposit was gratuitous and we do not think that such an intent can fairly be inferred from the language used. Neither did the affidavit nor the exhibits so state. The contention appears for the first time in plaintiffs' brief. Defendants were not required to plead to a fact which plaintiffs had not alleged and which is not clearly to be inferred from such allegations as were made. It appears from the complaint and plaintiffs' exhibits that when the transaction was being completed on or about December 1, 1948, a dispute arose concerning alleged misrepresentations. As a consequence the deposit in escrow was made. This appears to us to be an integral part of the transaction, a method of proceeding with the deal, reached by agreement and supported by the consideration which supports the transaction as a whole, and is not the isolated, unilateral, gratuitous act which appellant says it is.

The terms of the escrow, then, are material and must be proved. We cannot hold that Mr. Curran's affidavit extended by Exhibit "A" is sufficient proof to warrant a summary judgment upon it. As proof it rises no higher than the same allegations when he made them upon oath in the verified complaint, which allegations the defendants have on oath denied. Concerning Exhibit "A," we need only say that, the escrow agent to whom it was addressed being out of the case by stipulation, an objection to its competency must be overcome before it can even be received as evidence. The trial court was correct in refusing to accept it as proof upon the motion for summary judgment.

The power of the courts under the summary-judgment statute is drastic and should be applied only when it is perfectly plain that there is no substantial issue to be tried.Prime Mfg. Co. v. A. F. Gallun Sons Corp. (1938),229 Wis. 348, 281 N.W. 697. Plaintiffs' version was not so plain to the escrow agent who did not deliver the deposit when the fifteen days had expired, nor to the learned circuit judge who denied plaintiffs' motion, and it is not so plain to us. The motion for summary judgment on the complaint was properly denied.

As to plaintiffs' motion for summary judgment on the counterclaim, we need only say that sec. 270.635 (7), Stats., reads, in part, "but the court may withhold judgment on a counterclaim until other issues in the action are determined." If plaintiffs consider, as they urge upon us, that the counterclaim states no cause of action they may demur. It was no error for the trial court, under authority of the statute quoted, to deny the motion for summary judgment dismissing the counterclaim.

By the Court. — Order affirmed.