Killingstad v. Meigs

Barnes, J. This action was brought to foreclose a claim for mechanic’s lien. The complaint alleged, among other things, that plaintiff prepared and delivered plans and specifications for a building for which defendant agreed to pay $87.50. On the trial the complaint was amended so as to set up a cause of action on quantum meruit, and it was set forth that the plans and specifications furnished were of the reasonable value of $107.50. The answer alleged various defenses and contained a counterclaim for damages resulting from alleged insufficiency and incompleteness of the plans and specifications furnished and from failure to furnish details. The plaintiff moved for an order of reference, basing such motion upon the pleadings and upon an affidavit which recited that the answer set forth numerous setoffs and counterclaims, each of which involved questions of fact, and that the trial of the action would require a large amount of testimony to be taken. The court made an order of reference to hear, try, and determine, against the objection of defendant, and the latter duly excepted to such order. Thereafter the action was tried and the referee made his findings of fact and conclusions of law. Notice of the filing of such report was served on defendant’s attorney on December 24, 1910. On February 24, 1911, the latter filed his exceptions to such findings and conclusions, apparently without leave of court and without procuring any order excusing his failure to file the exceptions within ten days after the notice of filing was served, as prescribed by sec. 2871, Stats. (1898). These exceptions are incorporated in and made part of the bill of exceptions. — 513 — Tbe court confirmed tbe report of tbe referee and entered judgment in favor of tbe plaintiff and against tbe defendant, from wbicb judgment tbis appeal is taken. Tbe decision of tbe case necessitates a consideration of two questions: (l)-Are there any exceptions in tbe record wbicb will permit tbe court to review tbe questions attempted to be raised ? (2) Did tbe court err in ordering a compulsory reference ? Tbe first question must be answered in tbe affirmative. Tbe exception to tbe order of reference is preserved in tbe bill of exceptions, and tbis in itself would permit the court to review that order. Tbe exceptions to tbe findings and conclusions of tbe referee are likewise available. Tbe trial court could, under sec. 2832, Stats. (1898), excuse tbe default of tbe defendant and permit tbe exceptions to be filed after expiration of tbe time fixed by statute. Smith v. Smith, 19 Wis. 522. That case was decided when sec. 38 of cb. 125, R. S. 1858, was in force. Tbe material part of tbis statute is embodied in sec. 2832 of our present statutes. Where exceptions that appear to have been taken too late are incorporated in a bill of exceptions and are. found therein without explanation, it must be inferred that tbe court gave leave to file them. Henrizi v. Kehr, 90 Wis. 341, 63 N. W. 285; Ottillie v. Wœchter, 33 Wis. 252. On tbe second question there is some conflict in tbe decided cases in tbis court. Tbe amount in dispute in tbe instant case is trifling, but it is important that tbe question of practice involved should be set at rest. It is manifest from a reading of tbe pleadings, tbe evidence, and tbe affidavit filed in support of tbe motion to refer, that tbe trial and disposition of tbe case did not involve tbe examination of a long account, within tbe meaning of sec. 2864, Stats. (1898). Respondent concedes as much; and tbe concession was advisedly made, as will appear from an examination of tbe following cases: Knips v. Stefan, 50 Wis. 286, 6 N. W. 877; Druse v. — 514 — Horter, 51 Wis. 644, 16 N. W. 14; Andrus v. Home Ins. Co. 73 Wis. 642, 41 N. W. 956; Brillion L. Co. v. Barnard, 131 Wis. 284, 111 N. W. 483; Untermyer v. Beinhauer, 105 N. Y. 521, 11 N. E. 841. Despondent contends, however, that an action to foreclose a mechanic’s lien is declared to be equitable by sec. 3323, Stats. (1898), and that a court of equity has inherent power, independent of any statute, to order a compulsory reference in any equitable action. It must be conceded that our decisions are not harmonious upon this question, and that the cases of Gilbank v. Stephenson, 31 Wis. 592, and Commercial Bank v. McAuliffe, 92 Wis. 242, 66 N. W. 110, support the position taken by respondent’s counsel. Do those decisions correctly state the law ? Sec. 5 of art. I of our constitution declares that “the right of trial by jury shall remain inviolate, and shall extend to all cases at law without regard to the amount in controversy.” It was held that the compulsory reference statute was not Ob'noxious to this constitutional mandate, because its purpose was to preserve the right of trial by jury as it existed when the constitution was made, and inasmuch as there was then in force a territorial statute (Terr. Stats. 1839, p. 209, sec. 84) providing for the reference of cases involving the examination of a long account, it was not the intent of the constitution to place a ban on references in such cases. Stilwell v. Kellogg, 14 Wis. 461; Dane Co. v. Dunning, 20 Wis. 210. When the constitution was adopted, however, it was the common if not the universal practice of courts of chancery to refer pending causes to a master in chancery to take testimony. It is quite apparent that this method of trying equity cases had proved to be unsatisfactory, as well it might, and that it was the deliberate purpose of the framers of the constitution to make a radical change in the existing practice. Accordingly, by sec. 19 of art. YII of the constitution, it was provided that “the testimony in causes in equity shall be — 515 — taken in like manner as in cases at law, and the office of master in chancery is hereby prohibited.” .Construing this provision, in Noonan v. Orton, 5 Wis. 60, 61, the court said: “We have no doubt that each party to a suit in chancery is, under our constitution, entitled to have his witnesses examined in open court, subject, of course, to' the occasional exceptions provided for in cases at law.” In Brown v. Runals, 14 Wis. 693, the same question was considered and discussed at length.- There, as in the instant, case, there was a compulsory reference ordered, not because the examination of a long account was involved, but because the issues in the case would necessitate the taking of a large-amount of testimony. The court held that it was the intent and meaning of the constitutional provision quoted to give-litigants in equity causes the same right to have their witnesses examined and their testimony taken in open court as litigants in actions at law had in this regard. The abuses which arose under the old system are discussed and the wisdom of the change is approved and commended, and it was held that the right guaranteed was a substantial and a valuable one, and the judgment was reversed because it was held that the court erred in making the order of reference. Oh. 88 of the Laws of 1861 provided for the compulsory reference of certain classes of mortgage foreclosure suits. In Oatman v. Bond, 15 Wis. 22, this act was held to be in contravention of sec. 19, art. VII, of the constitution, and to deprive litigants of a right thereby guaranteed, and the court approved of what was said upon the subject in Noonan v. Orton and Brown v. Runals, supra. In Druse v. Horter, 57 Wis. 644, 16 N. W. 14, the court went a step farther and held that it was not permissible to order a compulsory reference in any equity action. In so far as this decision held that a reference might not be ordered in an equity action involving the examination of a long account,. — 516 — it was impliedly overruled in Littlejohn v. Regents, 71 Wis. 437, 37 N. W. 346, and Jordan v. Estate of Warner, 107 Wis. 539, 550, 83 N. W. 946, and was expressly overruled in Winnebago Co. v. Dodge Co. 125 Wis. 42, 46, 103 N. W. 255. In Klein v. Valerius, 87 Wis. 54, 61, 57 N. W. 1112, tbe portions of tbe decision in Oatman v. Bond above referred to are considered and approved, and in Winnebago Co. v. Dodge Co., supra, it is expressly said that tbe right to refer an equitable action must be found in tbe statutes, if it exists. Sucb is tbe general rule elsewhere. Thayer v. McNaughton, 117 N. Y. 111; Roome v. Smith, 123 App. Div. 416, 107 N. Y. Supp. 1088; 34 Cyc. 778, and cases cited in note 28. There are cases to tbe contrary, however. Id. 779, and cases cited in note 30. Tbe constitutional provision quoted would seem to be plain and unambiguous. It was construed within a very few years after tbe constitution was adopted, and that construction has been followed in many subsequent cases, ending with Winnebago Co. v. Dodge Co. 125 Wis. 42, 103 N. W. 255, where tbe decision in Brown v. Runals, 14 Wis. 693, is expressly approved, and we do not think that there ever was any intentional departure from that construction. No reasons are given in Gilbank v. Stephenson, 31 Wis. 592, or in Commercial Bank v. McAuliffe, 92 Wis. 242, 66 N. W. 110, for tbe conclusions there reached, and tbe constitutional provision is not alluded to in any way. Had there been any deliberate intent to overrule tbe former decisions upon tbe question, they would have been discussed and tbe reasons stated which led tbe court to place a different interpretation upon tbe constitution. Sec. 2864, Stats. (1898), applies to all actions whether in law or in equity. This has been uniformly held, as will appear from tbe decisions cited, except in tbe case of Druse v. Horter, supra, which has been overruled. There is little doubt that the construction adopted in tbe cases at variance — 517 — witih. Druse v. Horter is the correct one. Actions at law which involved the examination of a long account might he compulsorily referred ever since the constitution was adopted and for a long time before. Sec. 19 of art. VII, in providing that the testimony in equity cases should he taken “in like manner as in cases at law,” clearly means that, where we have an equity action which involves the examination of a long account, the action may he referred and the testimony taken in the same way that it may he taken in a legal action involving the examination of such an account. TTor can we regard the error complained of as immaterial. This court has uniformly held that it was reversible error to grant a compulsory reference where it was unauthorized. Brown v. Runals, supra; Oatman v. Bond, supra; Knips v. Stefan, 50 Wis. 286, 6 N. W. 877. We should he loath to say that the deprival of a party against his protest of a right guaranteed by our organic law could he so cavalierly disposed of. The cases of Gilbank v. Stephenson and Commercial Bank v. McAuliffe, In so far as they are in conflict with what is here decided, must be considered as overruled. It follows that the judgment of the circuit court must he reversed. By the Court. — The judgment of the circuit court is reversed, and the cause is remanded for a new trial.