Case ID: wis_152/html/0160-01.html
Source: Caselaw Access Project
Author: {"author": "TimliN, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Blizzard, Appellant, vs. Brown, Respondent.
    
      January 10
    
    January 28, 1913.
    
    
      Justices’ courts: Judgment: Collection: Subsequent reversal: Restitution: Liability of attorney: Pleading: Election between remedies: Appeal: Briefs.
    
    1. In an action against an attorney to recover moneys collected by him upon a justice’s judgment which was afterwards reversed on appeal, a demurrer to the complaint is not such an admission of the facts alleged as will sustain a motion in the supreme court, on appeal from an order sustaining the demurrer, to compel him to refund the money.
    
      2. An agent who has collected money to which his principal has no right, if he has had notice not to pay it over, is personally liable therefor to the party from whom it was wrongfully obtained, even after such payment over; and this rule applies to attorneys at law as well as to other agents.
    3. Where, after collection of a judgment rendered against the defendant in justice’s court, such judgment was reversed on appeal, the defendant did not, by obtaining an order for restitution under sec. 3772, Stats., against the plaintiff, waive his right to recover the money from plaintiff’s attorney who, after notice not to pay it over and after the reversal of the judgment, had paid a part of the amount collected.to the plaintiff.
    4. The obtaining of such an order of restitution was not an election between inconsistent remedies; nor is the statutory remedy exclusive.
    6. Counsel, in presenting precedents, should make first choice of . those in this court.
    Appeal from an. order of tbe circuit court for Dane county: A. H. Reid, Judge.
    
      Reversed.
    
    
      Elmore T. Elver, for tbe appellant..
    
      Ernest N. Warner, for tbe respondent.
   TimliN, J.

Tbe order appealed from sustained a demurrer to a complaint containing tbe following averments of fact:

(1) On December 9, 1910, one Mary Nelly, by tbe defendant, Charles N. Brown, ber attorney, began an action against tbe plaintiff before a justice of the peace and at tbe same time garnished a debtor of tbe plaintiff. Judgment was recovered therein in favpr of Mary Kelly and against tbe plaintiff for $116.32, and in tbe garnishment case in favor of Mary Kelly and against tbe garnishee defendant for $121.07. Tbe garnishee paid this sum last-mentioned to tbe justice.

(2) Tbe plaintiff in this action, defendant in that, appealed from tbe said judgment to tbe circuit court without supersedeas, and pending this appeal attorney for appellant therein and tbe defendant Brown negotiated'for a settlement, and tbe latter stated that unless a settlement could be made be would collect tbe money paid to tbe justice by tbe garnisbee and pay over said money to Mary Kelly, wbo was insolvent. Tbe attorney for Blizzard thereupon notified tbe defendant that if be did tbis be would do so at bis peril, and requested bim to permit tbe deposit to remain witb tbe justice awaiting tbe outcome of tbe appeal. Tbe trial of tbe cause was set in tbe appellate court for April 20, 1911. Three days before tbe date last mentioned tbe defendant Brown collected tbis money from tbe justice. When tbe case came up for trial in tbe appellate court on April 20, 1911, tbe present defendant, as attorney for Mary Kelly, consented to a nonsuit, which was accordingly granted, and thereafter and on tbe same day be paid over to tbe said Mary Kelly $86.07 of tbis money and retained for himself $35 thereof. On May 16, 1911, tbe circuit judge entered an order under sec. 3772, Stats., requiring said Mary Kelly to restore to tbe defendant in that action tbe sum of $121.07 witb interest and $10 motion costs. June 12, 1911, execution was issued thereon and returned unsatisfied. Tbe defendant Brown knew at all times that Mary Kelly was insolvent and in no position to restore tbe money collected on tbe garnishment judgment.

(A) Sec. 3772, supra, provides that if a justice’s judgment, or any part thereof, be collected and tbe judgment be afterward reversed, tbe appellate court shall order tbe amount collected to be restored, witb interest from tbe time of tbe collection; such order may be obtained upon proof of tbe facts, upon notice and motion, and may be enforced as a judgment.

(B) Tbe appellant at tbe time of presenting bis appeal from tbe order sustaining a demurrer to tbe foregoing complaint presents a motion against tbe defendant to compel tbe latter to refund to tbe appellant tbe said sum of $121.07 with motion costs and disbursements. Tbis motion must be-denied, because tbe defendant has not yet been adjudged guilty of tbe matters and things charged against bim in tbe complaint, even if we assume that these matters and things, if true, support the motion. An admission by demurrer is merely an hypothetical admission at this stage of the action. After a ruling against the demurrant the latter may go on and deny and disprove the averments of the pleading demurred to or the other party may fail to establish such aver-ments.

(O) The case is not presented very thoroughly. We expect counsel in presenting precedents to make first choice of those in this court. The case of Wright v. Eaton, 7 Wis. 595, should not have been overlooked. There an agent for collection retained out of moneys collected from Eaton a certain sum for his fees and expenses. He gave the debtor no credit for this sum, but proceeded by levy to collect the unpaid balance. After he had remitted to his principal all the money except that retained for his fees an action was brought against him. The court said:

“The fact that the claimant obtained this money ... as an agent, if wrongfully obtained, cannot absolve him from his liability to the person from whom it was thus wrongfully obtained, although he had paid it over to his principal.”

As long ago as Hearsay v. Pruyn, 7 Johns. 179, 182, it was said:

“The law is, I believe, well settled that an action may be sustained against an agent, who has received money to which the principal had no right, if the agent has had notice not to pay it over; and, in some cases, the action has been sustained where no notice was given, if it appears that the money has not actually been paid over.”

See, also, Houston v. Frazier, 8 Ala. 69; Shepard v. Sherin, 43 Minn. 382, 45 N. W. 718; Garland v. Salem Bank, 9 Mass. 408; Story, Agency (9th ed.) §§ 300, 301; Mechem, Agency, § 561 and cases cited; Bank of U. S. v. Bank of Washington, 6 Pet. 8; Cabot v. Shaw, 148 Mass. 459, 20 N. E. 99; Haunstein v. Ruh, 73 N. J. Law, 98, 62 Atl. 184.

This rule is applicable here. TLe case is not brought within any exception to this rule. It is averred that notice was given to the defendant that he would be held responsible and that he did not deliver the money to his principal until after the justice court judgment was reversed by the nonsuit order of the circuit court.

(D) It is contended, however, that by entering an order of restitution against the principal under see. 3712, supra, the plaintiff in this action elected to discharge the defendant herein and pursue only defendant’s principal. The defendant in this case was not a party to the action in which the order of restitution was entered. It could not have been entered against him. He might well demand, if this order was omitted, that plaintiff should have taken that step for the due protection of the defendant. Upon payment he would be entitled to subrogation. The remedy sought in this action against the defendant is not inconsistent with the talcing of such order of restitution against his principal, nor is the statutory remedy exclusive. Harrigan v. Gilchrist, 121 Wis. 127, 441, 99 N. W. 909. No rule of election of remedies controls, because this remedy invoked by this suit is the only remedy the plaintiff ever possessed against the defendant herein.

It follows that the order of the circuit court sustaining the defendant’s demurrer must be reversed, and the cause remanded for further proceedings according to law.

By the Court. — It is so ordered.