#### Washburn Water Works Company, Appellant, vs. Town of Washburn, Respondent.

*February 24*

March *17, 1914.*

*Setoffs: Judgments: Authority of attorneys: Towns: Division: Incorporation of city: Adjustment of equities: Title to judgments, etc.: New trial.*

1. Where a judgment creditor is sued by his debtor upon a different cause of action, he may plead his judgment by way of counterclaim, and if a balance be found due him'from plaintiff may have judgment therefor.

2. Where a water company operating by virtue of a franchise granted to it by an organized town having within its limits an unincorporated village of more than 1,000 inhabitants, sued such town for hydrant rental, and the latter counterclaimed for certain judgments previously obtained against the water company, it was no defense to such counterclaim that by agreement with a former attorney for such town the judgments had been set off against a judgrhent the water -company had recovered against a city formed from such unincorporated village, it not appearing that Such attorney had any authority from, the town to make such offset.

3. After judgment in such action in favor of the town upon its counterclaim, a motion was made for a new trial based upon affidavits showing that in another action between such town and such city and another town formed in part out of the original town, to settle the equities of the respective parties in the judgments against the water company, the city’s proportion had been fixed by a referee at a certain, sum, and that the water company had “settled” with the city, but not showing that any money had been paid to the city. *Held,*that the findings of the referee did not operate to transfer title to the judgments or any interest therein to the city, and the motion was properly denied.

Appeal from a judgment and an order of tbe circuit court for Bayfield county: G. N. Risjoed, Circuit Judge.

*Affirmed.*

Tbe appeal is from a judgment and.from an order denying a motion to vacate this judgment and grant a new trial.

*435
      *A. W. McLeod,*for tbe appellant.

*TS. G. Alvord,*for tbe respondent.

TimliN, J.

Findings in tbis case establish that tbe respondent on and prior to May 6, 1889, and from thence until May 1, 1904, was an organized town containing an unincorporated village of more than 1,000 inhabitants, and that tbe electors of said town at tbe annual town meeting next preceding May 6, 1889, conferred upon tbe town board all powers relating to villages and exercised by village boards under and pursuant to tbe provisions of cb. 40, R. S. 1878. On May 6, 1889, tbe town board of tbe respondent enacted and published-a franchise ordinance under which tbe appellant exercises its powers as a public-service corporation, supplying tbe inhabitants of said unincorporated village called Washburn with water. ■ On May 1, 1904, this village was incorporated as a city of tbe fourth class known as tbe city of Washburn. Tbe plaintiff brought tbis action against tbe town of *Wash-burn*for hydrant rentals amounting to $1,766.65 earned by it during tbe four months immediately preceding the date last mentioned. Tbis action for said rentals was not begun until after March 5, 1910. On July 18, 1904, tbe town obtained judgment against tbe appellant for $2,310, pursuant to tbe mandate of tbis court in *Washburn v. Washburn W. W. Co.*120 Wis. 575, 98 N. W. 539. On July 25, 1904, a further judgment for costs in tbe supreme court in said action amounting to $52 was duly given and rendered in favor of said town of *Washburn*and against said *Washburn Water Worles Company.*Tbe judgment first mentioned was proven by tbe record and tbe judgment docket, which shows tbe judgment creditor to be tbe town of *Washburn*and tbe judgment debtor tbe Washburn Water Company, admitted in open court to be tbe *Washburn Water Works Company,*appellant. Tbe other judgment seems to have been proven by tbe circuit court judgment docket. Tbe first judgment was noted on tbe *436docket, “satisfied this 19th day of July, A. D. 1901, attest F. A. Bell, clerk.” But there was no satisfaction on file and nothing recorded except the foregoing. Mr. D. M. Maxcy testified that he paid both judgments to Mr. W. M. Tomkins, now deceased, by paying Mr. Tomkins $133.34 and offsetting the balance of the judgment against a judgment which he held against the city of Washburn. There was no proof of any authority conferred upon or held by Mr. Tomkins to make such settlement.

On these facts the learned circuit court gave judgment on the counterclaim of the respondent for the amount thereof less the hydrant rental of $1,166.65 and interest thereon from the time the bill for that rental was filed with the’ town clerk, and less the $133.34 paid to Mr. Tomkins. Three months after this judgment was rendered the appellant moved on affidavits to vacate the judgment, claiming that the town of *Washburn,*respondent, formerly included territory now in the town of Eileen as. well as that included in the present city of Washburn. On October 31, 1904, the town of *Wash-burn*began an action against the town of Eileen and the city of Washburn for a settlement. The case was referred to a referee, and the referee reported that on April 19, 1904, the town of *Washburn*was indebted to the appellant in the sum of $1,604.10, and since that date the city of Washburn became indebted to the *Water Company*in a certain sum. The proportion of the judgment described in the counterclaim in this cause against the *Water Company*which the town ought to have was $1,604.10 and the city’s proportion $757.30. It is then averred that the appellant has settled with the city of Washburn and paid its share of said judgment and did not discover this record of the suit last mentioned until June 18, 1913. No details of the payment to the city of Washburn are given, no time or place mentioned, nor is it said there was anything paid to the city of Washburn, but merely that the appellant has settled with the city of Washburn. The sub*437stance of tbe affidavit is that the appellant should have an additional credit for $757.30, the proportion of the judgment in favor of the town which the town owed to the city. This was opposed by an affidavit showing that the judgment in the action referred to, viz. the Town of Washburn v. City of Washburn *et al.,*did not attempt to offset said judgment against the hydrant rentals; that the appellant’s attorney had knowledge of this record and personally examined it long prior to the trial of this cause, and that no part of the $757.30 mentioned was ever paid to the city of Washburn or to any other person for it.

Upon this case as presented to the circuit court the findings and the judgment were unquestionably correct. Appellant was the owner of a demand against the respondent and the respondent was the owner of two judgments against the appellant. The learned circuit court might have given the appellant judgment against the respondent and then on motion offsetlhe respondent’s judgment against that judgment. But it eould also proceed in the way it did. Secs. 4258, 4263, Stats. The moving papers used upon the motion to vacate this judgment showed no sufficient ground to compel a different disposition of the case. The appellant was not a party to the suit by the town of *'Washburn*against the town of Eileen and the city of Washburn for a settlement, and the findings of the referee relative to the proportionate equities between the city of Washburn and the town of *Washburn*in the judgment against the appellant, of which the latter was legally owner, did not operate to transfer title to that judgment or any interest therein to the city. Eor all we know and from all we can gather from this record, that was only an item in an accounting for settlement between the several municipalities which might have been offset by other items or which might enter into a judgment in favor of the city of Washburn and against the town of *Washburn.*The appellant, by the collection of the counterclaim in this case, will *438have paid its own debt to its own debtor, and whether the latter, by reason of this collection, will owe something to the city or not does not concern the appellant. If the appellant had shown that with the consent of the town of *Washburn*it had paid this sum which it owed the town of *Washburn*over to the city, that would constitute a payment to the town for which the appellant should have credit and which it should have asserted in its reply to the respondent’s counterclaim. Instead of doing so, the' appellant produces a statement which it calls a settlement with the town of *Wash-burn,*not only making no claim for this specific credit of $757.30, but pretty effectually concealing it. 'This statement gives the town credit for the judgments described in the counterclaim in this action and another judgment, and attempts to offset this by a judgment against the city with costs and interest and the payments'of $733.34 made to attorneys for the town for which it has received credit in the judgment appealed from. We are unable to discover any merit in the motion to vacate the judgment.

*By the Gourt.*— Judgment and order affirmed.