North Baltimore Bottle Glass Co. v. Altpeter

Siebeckee, J. The judgment rendered in the circuit court on the $200 note, prior to the order of consolidation of the actions, is in no way impeached as to its validity, .It must be presumed that the order vacating it upon condition that Alpetei pay the sums specified in the order was not complied with, since the judgment was entered after the expiration of the period given Altpeter to prevent its entry upon the verdict by the payment of the sums so ordered. Nor does the record disclose that any steps were taken by him to comply with the court’s directions in this respect. Defendants’ nonappearance upon the trial of this case resulted in not litigating the issues raised by the counterclaim alleged by defendants against the plaintiff’s claim on this note. The same counterclaim was interposed in each of the actions on the other two notes and was carried into the consolidated action. Upon the trial of the instant action the trial court was of the opinion that plaintiff’s recovery of a judgment in th'e action on the $200 note in the circuit court operated as an adjudication of the merits of the counterclaim, though defendants omitted to appear to actually litigate the issues raised by it, and that this amounted to an adjudication of the claim alleged in the counterclaim and precluded consideration of it as a counterclaim to’ the plaintiff’s claim in the actions on the other two notes. Under the circumstances shown, this ruling was not justified. Defend [117] ants’ counter claim constitutes an independent cause of action in their favor, which they were not compelled to present as a counterclaim, hut, if they so chose, they had a right to litigate it in a separate suit. Their failure to appear and litigate it as a counterclaim to the demand on the $200 note was in effect a withdrawal of it from that action, and it therefore constitutes no part of the judgment in that case, and such judgment is therefore inoperative as a har to the prosecution of the counterclaim in a subsequent action. Ressequie v. Byers, 52 Wis. 650, 9 N. W. 779 ; Dudley v. Stiles, 32 Wis. 371; 2 Black, Judgm. (2d ed.) § 620 et seq.; 1 Van Fleet, Former Adjud. § 168. There is nothing in plaintiff’s conduct showing an intention to waive its right to this judgment of the circuit court. The circumstances disclose that counsel who were conducting the case for the plaintiff were misled through' an inadvertent omission to note the state of the proceedings in each of the actions on these three notes, and consequently did not know that the defendants had defaulted and had not complied with the conditions of the order vacating this judgment on the $200 note. This also explains why this action was included in the stipulation for a consolidation of 'the actions. Defendants, however, were in no way misled to their disadvantage, and the circumstances can furnish no ground for an estoppel against plaintiff’s asserting its right to the judgment. The defendant Alt-peter is a voluntary bankrupt, and it appears that he scheduled plaintiff’s notes as subsisting debts, and that he was discharged from all his debts on July. 23, 1899. There is nothing to show that this counterclaim was treated as an asset or was claimed by the trustee in bankruptcy. Under these circumstances it is a subsisting liability against plaintiff, and is properly enforceable as such by Altpeter s surety in plaintiff’s suit on the two notes not theretofore prosecuted to judgment. Plaintiff contends that the evidence adduced is insufficient [118] to authorize the assessment of any damages as the proximate result of its failure to furnish the size of bottles purchased from it, and, if such damages were shown, that Altpeter waived them by his failure to inspect the bottles when he received them and to return them, and that his use of them in his business for about three weeks before making any complaint that they did not comply with the terms of the purchase constitutes an acceptance of them. There is evidence tending to show that the defect in the size of the bottles was not apparent from mere observation; that Altpeter believed they were of the proper size, and first learned that they were not from the complaints of his customers after he had used them for some weeks; that he thereupon had them tested, found them wanting, and immediately notified plaintiff. This conduct tends to show that he acted with reasonable diligence, and precludes the inference of an acceptance of them as complying with the order, or that there was a waiver of any damages resulting from plaintiff’s default. Altpeter also testifies that his customers, for this reason, refused to deal with him thereafter, unless he should cease using these bottles and furnish his commodities in bottles of the proper size; that he was unable to secure bottles of the regular size in the market, and that he was therefore compelled to wholly abandon his business for that season. If these facts are found, then these consequences are within the natural and probable results of plaintiff’s default to comply with the agreement, and they are sufficiently definite in their character to afford reasonable ground for estimating the damages they occasioned. Upon these considerations the judgment must be reversed and the cause remanded for a new trial, so that the issues raised by the counterclaim may be litigated in the action. By the Gourt. — It is so ordered.