Driver v. Gillette

GATES, J. Appeal from an order overruling a demurrer to defendant’s counterclaim. This action is upon a promissory note. By his amended answer defendant admitted the giving' of the note, but alleged that it was given as part of the purchase price of plaintiff’s dental business at Armour, including office and fixtures; that as an inducement to such purchase, upon which defendant relied, plaintiff made false representations as to the value of the business; and that certain articles of furniture belonging to another were included which were thereafter taken by the true owner. The .counterclaim reiterated the above allegations and further alleged: “That the plaintiff sold and delivered' to him his office furniture and fixtures and dental business at,, Armour, S. D.,. but that after,the said sale the plaintiff repeatedly told people lfging in Armour and vicinity that he was coming back to Armour to resume his practice at his old office, and the plaintiff further stated that he had not sold his said ¡business to the defendant, but had merely made arrangements with him to run his business until he returned. “That the plaintiff caused to be published in the Armom •Chronicle, a weekly newspaper published at Armour, S. D., a statement to the effect that he had commenced suit against the defendant for the purpose of getting possession of his office furniture and fixtures and dental 'business at Armour, S. D., and that he would resume his said business at Armour, S. D. “All the foregoing was false and injurious to the business [64] of this defendant, and the- defendant was damaged thereby in his dental business at Armour, S. D., in the u-m of $1,000.” [1, 2] Appellant mistakenly contends that the counterclaim contains a cause of action for libel. Further discussion of that contention is not deemed necessary. He also contends that respondent’s cause of action does not arise “out of the contract or cause of action set forth in the complaint as the foundation of the plaintiff’s claim', or connected with the subject of the action,” within the meaning of subdivision 1, § 127, C. C. P. 1903 (Rev. Code 19-19, § 23-54, subd. 1). -Appellant contends that his cause of action arises from the giving of the promissory note by respondent and from respondent’s default in not paying it when due, and that such is the only transaction set out in the complaint. Appellant overlooks the controlling" point that the promissory note -w'as but the evidence of the debt due from respondent to him, and that respondent was entitled to make the same defense or counterclaim as if the original contract, of which the promissory note was the evidence, had been sued upon. In Laney v. Ingalls, 5 S. D. 183, 186, 58 N. W. 572, this court said: “As between the original parties, or those who stand in their place, it would be repulsive to our practice, and inconsistent with a fair, economic and speedy administration of justice, to hold that a person sued on a promissory note given for the purchase price of personal property could not defend on the ground that there w-as a failure of consideration or a breach of warranty as to the quality of such property, which, if proved, would partially or entirely defeat plaintiff’s recovery. The reasons for the practice are too apparent to admit of argument or illustration. It avoids á multiplicity of suits, enables litigants to determine their controversies without additional expenses, and, in case a plaintiff be insolvent, it is often the only means by which a defendant may obtain justice and prevent a wrongdoer fro-m' obtaining something for nothing.” See, also, the authorities -cited in such opinion. We are convinced that the issues raised by the counterclaim arise “out of the cause of action set forth in the complaint,” and also that they are “connected with the subject of the action.” The order overruling the demurrer is affirmed.