Mason v. Summers

Philips, P. J. I. The first question for consideration on this record is, was the judgment in the former suit conclusive on the parties hereto as to the issues tendered in the answer of defendant herein ? That the judgment is conclusive of every matter within the terms of the issues made by the pleadings therein, is too well settled to require the citation of any authorities. The judgment of a court of competent jurisdiction, directly upon the same point, as a plea in bar, or as evidence conclusive between the same parties and their privies, is a complete estoppel in every other jurisdiction. Wells on Res Adjudicata, ch. 22; Henry v. Woods, 77 Mo. 280; Railroad v. Levy, 17 Mo. App. 507. The very question involved in the former litigation between the parties was, as to whether the plaintiff — 181 — therein had kept and performed the contract in question, and whether the defendants therein had violated it. Summers affirmed that he had kept and performed it, and that Mason and Carter had broken the agreement, while Mason and Carter denied that they had so broken it, and alleged that Summers had failed to keep it. That was the issue tried, and by the verdict of the j ary and the judgment of the court we are bound to hold that the issue was found against the plaintiff therein, the defendant here. The judgment, therefore, is conclusive on the parties herein as to such issues. Yet it is perfectly apparent that the whole issue tendered by the defendant in the action under review is, that he had kept and performed the said contract, and that Mason and Carter had not done so, and that by reason of the premises the plaintiff is not entitled to recover herein. And it is manifest from the declarations of law given by the court that it held, if plaintiff had not performed and that defendant had performed the contract, the plaintiff was not entitled to recover. This clearly indicates that the court re-tried the issues litigated in the former action, in total disregard of the existence of the judgment therein. In this it was manifestly in error. II. The plaintiff’s action herein proceeds upon the theory that it having been judicially ascertained and established in the former proceeding and judgment between the same parties, or their privies, that the defendant, Summers, had not performed the contract, and was the party in default, he was not entitled to keep the money paid thereon by the other parties thereto. On this theory his form of action, as for money had and received, was well conceived. Hill v. Reur, 11 Met. 268; Brown v. Harris, 2 Gray, 359; Lyon v. Annable, 4 Conn. 350; Appleton v Chase, 19 Me. 74; Smithhurst v. Woolston, 5 Watts & S. 106; Stewart v. Phy, 11 Oregon, — 182 — It must, therefore, follow that plaintiff is entitled tc recover, unless it can be maintained that this claim foi the recovery of the five hundred dollars was embraced within the former adjudication. It may be conceded to defendant in error that where a given matter has become the subject of litigation, and has passed into judgment, the parties are required to bring forward their whole case, and they will be concluded as to every matter embraced within the terms of the issues made in the pleadings, or which might have been brought forward as part of the subject matter of the action or in defence. Railroad v. Levy, supra, 508, and authorities cited; Aurora City v. West, 7 Wall. 106. It is also said by courts and text writers that the rule of res adjúdieata applies to every jmint which properly belonged to the subject of litigation, and which -the parties exercising reasonable diligence might have brought forward at the time. But it will be seen, from an examination of the adjudicated cases making a jiractical application of this rule, that the matters thus, presumed to have been adjudicated are such as are affirmed in the petition, or pleaded in defence, or such as might have been tendered as a matter of defence, but does not extend to matters which the defendant might have pleaded by way of set-off or counterclaim, but in fact did not set up. Wells, in his work on res adjúdieata, section 250, speaking to this rule, says : “There are limitations, however, which we will notice-below. There are some claims, as for instance, set-offs, and the like, which a party is not always bound to litigate in a pending action.” Again, in section 268: “ The question of cross-claims, or set-offs, requires our notice. It has been held that, where a defendant has a set-off, or counter-claim, applicable to the subject matter of a suit brought against him, he may produce it, but is not bound to do so. But if he does submit it to litigation, he is bound by the results. The parties are at liberty to settle their controversies in such cases in one suit, or by separate action; as, for example, a breach of warranty — 183 — in-Michigan can be set np by way of recoupment of damages in an action for the purchase money of land, or, otherwise, be sued on separately, at the election of the defendant. And so in New York, in regard to a warranty of personal property. If a defendant sees proper he may allow judgment against him for the full value of the goods, and then bring an action for the breach of warranty, or he may recoup the damages resulting from the breach in the action against him for the price. The same has been held in Iowa.” So in Alabama, in the case of Robbins v. Harrison (31 Ala. 163), it was held that, where a suit is brought for the purchase price of a horse, the defendant is at liberty to recoup damages for fraud in the sale, or he may allow judgment to go against him for the amount of the note, and then bring an independent action for the fraud. Without admitting that such a ruling would obtain in this state, under similar facts, in view of our practice act allowing the defence of a total or partial failure of consideration, where the defendant claims nothing more, yet the case is valuable as illustrating the tenacity with which courts maintain the principle that the defendant, under circumstances like this, is not concluded by a judgment against him as to the matter of set-off, or counter-claim-. When Mason and Carter were sued on the contract by Summers, they had a right to insist upon the simple defence that they were not in default, and that plaintiff himself had broken the contract, and they might have claimed a return of the purchase money paid by way of counter-claim. But this claim would not have been matter of defence to plaintiff’s cause of action, but would, under the practice act, have been a counter-claim, pure and simple. As such, they had the right to withhold it until the determination of the action, to determine whether plaintiff or defendants had kept the contract. Had Summers prevailed in that action, unquestionably the judgment woud have been a bar to the present action, as it would have been a judicial ascer — 184 — tainment of the fact that Mason and Carter were in default on their contract; and, therefore, the very foundation of the present action would have been swept away. But the record in the original suit shows affirmatively that the defendants withdrew their counter-claim before trial and submission. This they had a right to do; and in such case it was not adjudicated upon. Burwell v. Knight, 51 Barb. 267, and authorities cited. The argument of the learned counsel for defendant is, that as it was admitted by the pleadings that the five hundred dollars was paid on the contract, and the plaintiff only prayed judgment for the amount sustained in excess of the sum of five hundred dollars so paid him, this payment was in fact embraced within the substance of the issues. This is ingenious, but it does not stand to authority or sound logic. If respondent’s contention were tenable it at once becomes apparent that the plaintiff in an action for breach of such a contract, by merely admitting in his petition a fact which is undeniable as a part of the transaction, the receipt of a part of the purchase money when the contract was executory, and asking necessarily for a judgment after deducting the amount so received, could thereby compel the defendant, at the risk of a claim of res ad/judiqata, to bring forth his counter-claim, in addition to a general denial, which would be a complete defence to the action. If this be so, what becomes of the well recognized rule that the vendee, when sued on such contract for specific performance, or for breach, is not compellable to interpose his counter-claim ? The defendant had a right to stand on a general denial, and if that defence was maintained the plaintiff was out of court. As said in Appleton v. Warner (supra): “If the record, as in this case, shows that the claim was not tried and submitted, no other proof was necessary ” on the part of the defendant. In Barker et al. v. Cleveland (1 — 185 — Clarke (Mich.) 238), Cooley, Ch. J., speaking to a like principle, observed: “In the present case we do not deem, it important to determine whether the justice * * * took into consideration the moneys, if any, paid towards the purchase price. If he did we think he went aside from the issues to do so, and could not thereby bind the vendor, who did not by his pleadings make the matter the subject of litigation in that suit. * * * The payment of something towards the purchase price appears to have been brought before the justice in the suit * * * by their exhibiting a bill in which they charged Cleveland with one hundred dollars paid. Cleveland had no interest in disputing the payment in that suit, and we do not know whether the justice did or did not allow it to affect the damages he awarded. But, however that may be, it is clear, we think, that Cleveland’s suit for the purchase price was not affected by any matter not in issue being brought to the notice of the justice, and proofs given concerning it by the plaintiff.” So in the former suit between Summers and Mason and Carter, the defendants had no interest in disputing the matter of the payment of the five hundred dollars, and we have no means of knowing, from this record, whether the jury allowed that fact to influence their verdict. On the contrary the record shows affirmatively that Mason and Carter declined to submit their counter-claim for adjudication, and withdrew the same before trial and submission. There being no proof that the jury considered or passed upon the fact of such payment, or that it influenced their verdict, we must assume upon this record that the fact was adjudicated in' that action, that defendants were not in default in their contract, and that plaintiff was.- The unavoidable result, therefore, must follow that Summers held five hundred dollars of Mason and Carter’s money to which he was not-entitled, and the finding of the court' should have been for the plaintiff on the uncontradicted evidence. — 186 — ' The judgment of tbe circuit court is, with the concurrence of the other judges, reversed, and the cause remanded to the circuit court, with directions to enter judgment for plaintiff for the recovery of the five hundred dollars, with interest thereon from the date of its-receipt by defendant. All concur.