Dietrich v. Koch

Lyon, J. The plaintiff seeks by this action to procure the discharge of two certain judgments recovered against him in the year 1863, and he states in his complaint the facts which he claims entitle him to relief. The portion of the answer demurred to does not controvert the right of-the plaintiff to have the judgments discharged. The allegations thereof relate exclusively to the invalidity of the deed of May 9th, 1870, which is the subject of the counterclaim contained in the answer. This portion of the answer is pleaded both as a defense and a counterclaim, and is demurred to as not stating a defense to the action or a good cause of action by way of counterclaim. It is very clear that, as distinguished from a counterclaim,the portion of the answer demurred to fails to state facts con [626] stituting a defense to the action. Conceding, for the purposes-of the case, that, were an action brought bj the other heirs of Carl and Margarethe Dietrich against the plaintiff to annul the-deed of May 9, 1870, the facts stated in this answer are sufficient to entitle the plaintiffs in such action to the relief demanded, we are brought to consider whether such cause of action is-a proper counterclaim to this action. If it is not, the answer is demurrable; for a demurrer lies to an answer containing a> counterclaim, when it appears upon its face that it does not constitute a counterclaim to the action. R. S., ch. 125, sec. 16 (Tay. Stats., 1441). The term counterclaim, of itself, imports a claim opposed to, or which qualifies, or at least in some degree affects, the plaintiff’s cause of action. It has been held in New York that a counterclaim, to be valid, must to some extent impair, affect or. qualify the plaintiff’s right to the relief to which he would otherwise be entitled by his action. In Mattoon v. Baker, 24 How. Pr. R, 329, the court says: “A counterclaim, to be-available to a party, must afford to him protection in some way against the plaintiff’s demand for judgment, either in whole or in part. It must, therefore, consist in a setoff or claim by way of recoupment, or be in some way connected with the subject, of the action stated in the complaint. It must present an answer to the plaintiff’s demand for relief, must show that he is-not entitled, according to law, or under the application of just-principles of equity, to judgment in his favor, as or to the extent claimed in the complaint.” (P. 332.) See also Pattison v. Richards, 22 Barb., 143; and National Fire Ins. Co. v. McKay, 21 N. Y., 191. In the latter case, Judge Comstock uses the-following language: “ I apprehend that a counterclaim, when established, must in some way qualify, or must defeat, the judgment to which a plaintiff is otherwise entitled.” (P. 196.) That the New York courts have held correctly on this subject, we entertain no doubt whatever. We are unable to perceive that the counterclaim here inter [627] posed, if established, can qualify or in any manner affect the plaintiff’s cause of action. Should the defendants succeed in proving that the deed of May 9, 1870, ought to be annulled, this fact, of itself, will not affect the plaintiff’s cause of action. Upon proper proofs he will still be entitled to have the judgments against him discharged. It necessarily follows that the cause of action stated in the answer is not available to the defendants as a counterclaim to this action. We conclude that the demurrer is well taken, whether the portion of the answer demurred to be regarded as a defense or a counterclaim, and this renders it unnecessary for us to determine whether, if the allegations of the answer are true, the deed in question ought to be cancelled in some proper proceeding for that purpose. But, under the familiar rule that a general demurrer to any pleading reaches back in its effect through the whole record and attaches to the first substantial defect in the pleadings, the counsél for the defendants attack the complaint, and they argue that it fails to state facts sufficient to constitute a cause of action. The counsel for the plaintiff contend that the rule does not apply to a demurrer to a counterclaim, and urge some very plausible reasons in support of the position. * Without stating the argument or passing upon the question of the effect of a demurrer to a counterclaim alone, it is sufficient to say that this demurrer is not only to the answer as a counterclaim, but as a defense, also. It is in the latter particular analogous to a demurrer to a plea in bar under the old practice, which always reached back to the declaration. We must determine, therefore, whether the complaint states a cause of action. If it does not, the demurrer to the answer must be sustained as a demurrer to the complaint. Otherwise it was correctly sustained as a demurrer to the answer. The pi’incipal objections taken to the complaint are, that it appears upon the face thereof, 1. That the plaintiff was guilty [628] of a fraud upon tbe creditors of bis cograntee, Kunckel, in pro curing tbe judgments in question to be obtained against Kunckel and bimself, and perhaps in other transactions. 2. That no consideration was paid by the plaintiff on account of the alleged settlement of the judgments in question, but the same was a mere voluntary settlement without consideration, so far as Carl Dietrich is concerned, and that a court of equity would not enforce the same or any executory agreement relating thereto, against the said Carl, were he living, and will not enforce the same against his heirs and personal representatives. As to the first of these objections, tbe legal proposition involved in it was ruled adversely to the defendants in Clemens v. Clemens, 28 Wis., 637. It was there held that conveyances of property and transactions and agreements between parties, although made for the purpose of defrauding creditors, are, nevertheless, valid and binding upon the parties themselves and their personal representatives. The opinion by DixoN, C. J., contains a most able discussion of the whole subject, including a review of numerous authorities, and is well worthy of a careful perusal. The same doctrine is asserted in Hardy v. Stonebraker, 31 Wis., 640. Whatever fraud may appear to have been committed by the plaintiff upon the creditors of Kunckel, the complaint does not show that any fraud was committed by the plaintiff upon Carl Dietrich. If no fraud was thus perpetrated upon the latter, his heirs cannot take advantage of an alleged fraud upon strangers to this litigation, to defeat the plaintiff’s action. Neither is the second objection above mentioned well taken. In addition to the consideration of natural love and affection, the complaint alleges valuable considerations paid by the plaintiff on account of the alleged settlement, which includes (as it is averred) the satisfaction of the judgments in question. These are, the conveyance by the plaintiff to Carl Dietrich of the forty acres of land in the town of Lake, and the covenants of the plaintiff, contained in the deed of May 9, 1870, to sup [629] port the said Carl and to pay him an annuity of two hundred dollars during his natural life. We are of the opinion that the complaint states a cause of action within the jurisdiction of a court of equity. By the Court — The order of the circuit court, sustaining the demurrer to the answer, is affirmed.