#### West Allis Lumber Company vs. Wiesenthal, Appellant, and Smith-Blodgett Company, Respondent.

*January 11*

February *1, 1910.*

*Liens: Notice by subcontractor: Bight of owner to setoffs: Pleading: Counterclaim.*

1. Sec. 3315, Stats. (1898), as to stating, in the subcontractor’s notice, the amount due, is satisfied by such substantial compliance therewith that the person served with notice can readily determine therefrom the correct amount.

2. In an action to enforce a subcontractor’s lien, the owner of the building is entitled to the benefit of all deductions from the ''claim which the principal contractor might rightfully insist upon, including damages for failure to properly perform the subcontract.

3. In an action to enforce a subcontractor’s lien, damages for non-fulfilment of the subcontract may be claimed by the owner of the building as an offset, and pleaded as such in the form of a . counterclaim.

4. Matter of offset must, in any case, be pleaded as a counterclaim.

5. If facts pleaded as an offset in the form of a counterclaim do not constitute a cause of action in favor of the party pleading them, the pleading is not demurrable for insufficiency though relief to the extent of a judgment in favor of such party is demanded. [Syllabus by Mabshail, J.]

Appeal from a judgment of tbe circuit court for Milwaukee county: W. J. TubNeb, Circuit Judge.

*Reversed.*

*461Action to foreclose a subcontractor’s lien under cb. 143 (secs. 3314 — 3347»), Stats. (1898). With the proprietor-*(Wiesenthal)*and the principal contractor (Potter), *Smdth-Blodgett Gompcmy,*a corporation, was made a defendant upon the ground of its claiming a like lien.- The complaint was in the usual form. The defendant lien claimant answered setting up its demand and praying for appropriate relief. The-answer was duly served upon all parties concerned.

A subcontractor’s notice was served by *Bmifh-Blodge.it Company*for the purpose of complying with sec. 3315, Stats. (1898). In respect to the statutory requirement for such notice to state the amount due the subcontractor from the principal contractor, the writing showed by appropriate words that the subcontractor performed for the principal contractor lienable work and fumighed him lienable material in constructing the dwelling house in question of the value of $412.13, referring to an exhibit made part of the notice. Such exhibit contained an itemized statement of $697.13, upon which’was credited $285, and a balance brought down of $412.73, opposite the words “Balance due.”

The proprietor answered the demand of defendant lien-claimant, putting in issue the allegations of its pretended cause of action, and further pleading, in the form of a counterclaim, a setoff to the effect that the subcontractor agreed with the principal contractor to put in the heating plant- and do the plumbing work in the building in first-class workmanlike manner, with such material as the contract called for; that in breach thereof it failed to do good work or to use good material or install the heating plant as agreed, rendering the-house as completed, of less value than it otherwise would have been, to the extent of $500, for which judgment was demanded against the subcontractor with costs.

The counterclaim was duly replied to.

The court ruled on the trial that the notice was sufficient- and that the owner ,of the building could not counterclaim, *462■against tbe subcontractor’s demand for tbe damages bis creditor might have for failure to carry out tbe contract.

Tbe court found in favor of tbe proprietor on plaintiff’s -cause of action for want of proper service of the notice of lien, but found in favor of *Bmilh-Blodgett Company*on its ■claim, and ordered judgment accordingly. Tbe amount of such claim witb costs was $298.47, wbicb included tbe full -amount mentioned in tbe notice less $200 paid after service ■thereof. Tbe proprietor appealed.

For tbe appellant the cause was submitted on tbe briefs of *F. C. Weed.*

For tbe respondent there was a brief by *Holt &*Coombs, .attorneys, and *John J. Coolc,*of counsel, and oral argument by *A. N. Coombs.*

Maeshall, J.

Tbe subcontractor’s notice to tbe proprietor did not, witb commendable fulness, comply witb the requirement of sec. 3315, Stats. (1898), as to stating tbe ■amount due from tbe principal contractor; but it did comply therewith substantially. There was no difficulty in determining therefrom and the statement, made a part of it, tbe ■exact amount claimed to be due. . That was sufficient. Such •compliance satisfied tbe statute. *Hausmann Bros. Mfg. Co. v. Kempfert,*93 Wis. 587, 67 N. W. 1136; *Chandler L. Co. v.*Fehlau, 137 Wis. 204, 117 N. W. 1057.

Tbe learned circuit court committed fatal error in ruling that tbe owner of tbe building could not reduce tbe claim of tbe subcontractor by offsetting damages for breach of bis contract witb tbe principal contractor, pleaded in tbe form of a counterclaim. Tbe proposition involved is ruled by *the*statute itself (sec. 3315, Stats. 1898), and by *Seeman v. Biemann,*108 Wis. 365, 376, 84 N. W. 490. It was said by tbe court in tbe *Beeman Case,*that in an action to enforce a subcontractor’s lien under tbe statutes of this state, tbe owner •of tbe property affected is entitled to tbe benefit of all tbe *463•defenses against tbe claim possessed by tbe principal contractor ; referring to tbe statute. ■ -Tbe term “defenses” as there used includes all claims by way of setoff which tbe principal contractor has against the subcontractor. True, tbe proprietor cannot obtain an affirmative judgment against the subcontractor in the right of tbe principal contractor, but he can have full benefit of tbe setoff, which is pleadable as a counterclaim. *Schumacher v. Seeger,*65 Wis. 394, 27 N. W. 30. Tbe statute expressly so provides:

“In actions in courts of record a setoff claimed by tbe defendant shall be pleaded as. a counterclaim and regulated by tbe rules of pleading and practice applicable to counterclaims. . . Sec. 4264, Stats. (1898).

Tbe learned court overlooked the fact that this court derided in *Seeman v. Biemann, supra,*that the property owner, in a case of this sort, has all the rights of the principal contractor as to such matters as will qualify or defeat the claim ■of tbe lien claimant; and further overlooked tbe fact that iaatter of setoff is to be treated, in pleading, the same as a counterclaim; and, further, that where the facts constitute a good setoff in favor of tbe party pleading them, but do not constitute a cause of action in his favor against the complainant, the pleading setting up tbe setoff in form as a counterclaim, is not demurrable for insufficiency, although it improperly demands an affirmative judgment. *Schumacher v. Seeger, supra.*

*By the Gourt.*— Tbe judgment is reversed, and the cause remanded for further proceedings in~respect to the appellant’s claim of setoff and for judgment according as tbe facts in ■that respect and those heretofore found, may appear.