Sanitas Co. v. Niezorawski , 138 Wis. 377 ( 1909 )

Barnes, J.

The cause of action against the defendant surety, as stated in the complaint, is based upon the refusal of Ternes to pay over to the plaintiff moneys collected by him as agent. The allegations of the complaint fairly show liability on the part of the defendant because of a breach of the conditions of the bond sued on. To such cause of action the defense was attempted to be interposed that plaintiff transacted business in this state in violation of sec. 1770b, Stats. (1898), and therefore could not recover. The defense was not well pleaded, because the answer denied an allegation of the complaint setting forth that the plaintiff was a foreign corporation, and simply alleged that plaintiff held itself out to be such a corporation. Sec. 1770b does not reach cases of mere representation. The court found that plaintiff was a foreign corporation, and the finding was not excepted to, so the unaccountable denial of the answer does not preclude defendant from prevailing on the defense attempted to be pleaded. There was evidence offered which was ample to show that, if the defendant was in fact acting as the agent of the plaintiff, it was transacting business in violation of sec. 1770b.

The answer expressly admitted that Ternes was acting as the agent of the plaintiff and did not deny the existence of the indebtedness. Hence there was no necessity for proof on either subject. The plaintiff, desiring no doubt to obviate the defense attempted to be interposed, offered proof tending to show the amount of the balance due, and also tending to show that the relation of debtor and creditor existed between it and Ternes, instead of that of principal and agent. This evidence was received without objection. It showed plainly enough that Ternes, instead of handling the goods shipped him by plaintiff as its agent, purchased such goods outright. If this were true, the business transacted between the parties was interstate commerce pure and simple and there was no violation of sec. 1770b by plaintiff. The bond, however, on which suit was brought restricted the liability of the defendant to obligations incurred by Ternes as agent, and did not cover indebtedness such as was proved to exist by the evidence given on the trial.

The circuit court disposed of the case upon the theory that sec. 1770b had been violated; but, whichever view is taken, the judgment is correct and therefore should be affirmed.

By the Court. — Judgment affirmed