Case Name: Ficks and others, Respondents, vs. Purcell, Appellant
Court: Wisconsin Supreme Court
Jurisdiction: Wisconsin
Decision Date: 1917-01-16
Citations: 164 Wis. 596
Docket Number: 
Parties: Ficks and others, Respondents, vs. Purcell, Appellant.
Judges: 
Reporter: Wisconsin Reports
Volume: 164
Pages: 596–600

Head Matter:
Ficks and others, Respondents, vs. Purcell, Appellant.
December 5, 1916
January 16, 1917.
Reformation of instruments: Mistake: Evidence: Sufficiency: Estop-pel: Waiver.
1. In an action to reform a contract by which defendant sold to plaintiffs his interest in a partnership between him and one of them, a finding of the trial court that the consideration for such sale was to be the amount defendant had actually invested in the business, and that through a mutual mistake of fact such amount was overstated, is held to be sustained by the evidence.
2. Payments made by plaintiffs to the defendant after their discovery of the mistake did not, under the circumstances of the case, operate as an estoppel or waiver of the right of defendant’s former partner to recover the amount overpaid.
3. A further finding in such case that a note for $500 given by defendant to his former partner was given as security for the bad debts of the partnership and not as a reduction of the amount paid to defendant for his interest, is also held to be sustained by the evidence.
Appeal from a judgment of the circuit court for Dane county: E. Ray Stevens, Circuit Judge.
Affirmed.
The appeal is from a judgment decreeing the reformation of a certain contract between the parties and that the plaintiff Ficks recover of the defendant the sum of $1,000.
The plaintiff Fieles and defendant in September, 1910, entered into partnership, the agreement providing that the defendant was to furnish the capital needed, not in- excess of $5,000, and that if at the end of the first year both parties so desired, each should become the owner of an undivided one-half interest in the business and property by an agreement to be made at that time, but that if it were not satisfactory then the defendant should have the right to withdraw the amount originally invested, with interest at five per cent, in so far as the assets were sufficient to do that.
They entered upon that business and conducted it for about a year, at which time the defendant became desirous of disposing of the business, and finally the plaintiff Fieles secured the plaintiffs Barnard and Webster to join with him in taking over the said business, and the four then made a written contract dated September 18, 1911. This new agreement recited the former partnership and the desire of the plaintiffs to take the same over and form a corporation to carry it on. The contract as first drafted contained a recital that the said defendant has an “investment” of $7,000 in said partnership, and has also bécome personally liable for certain bank loans made to the partnership for the conduct of the business. At the time of the signing of the agreement the word “investment” was stricken out and the word “interest” inserted, apparently by the plaintiff Webster. The contract provided for the method in which the payments to defendant were to be made, part in cash, the rest in notes, the last payment being made about a year after the making of this second contract.
At the time of the making of the second contract it was supposed that the indebtedness to the bank covered by the notes was $5,500. It was also understood by all the parties that the entire amount invested, including loans, was $14,500, of which it was undisputed the plaintiff Fieles had advanced •$2,000; and, on tbe assumption that tbe indebtedness of tbe bank was $5,500, this would have made tbe investment of defendant tbe $7,000 mentioned in tbe contract.
Immediately after tbe closing of tbe deal between tbe four parties it was ascertained that tbe indebtedness covered by tbe notes to tbe bank was $6,500 instead of $5,500, and that larger amount was paid by tbe new corporation. There was some conversation then between tbe parties witb reference to this condition, and plaintiffs testified that it was suggested that tbe matter should be left for further examination, and that if it should then appear that defendant bad been •overpaid be would repay. There was also' testimony of a conversation between plaintiff Ficks and defendant to tbe effect that there were obligations due tbe former copartnership which in all probability would not be paid and that Ficks desired to be secured to tbe amount of $500 by defendant, as Ficks bad guaranteed tbe payment of such debts to tbe new company. Tbe defendant executed bis note at tbe time of tbe closing of tbe deal to the plaintiff Ficks for $500 and subsequently paid tbe same. There were such unpaid debts due the old copartnership. It appeared that during tbe first year of tbe business tbe books of account were not very accurately kept. Loans had been made at various times during tbe first year evidenced by notes given to tbe banks, some of which were renewed from time to time by tbe giving of new notes.
Tbe defendant testified to tbe effect that be sold whatever interest be bad in tbe business to tbe plaintiffs for tbe $7,000 and. that there was no understanding or agreement that it was meant by tbe reference to the $7,000 in tbe contract to measure tbe interest that he then actually had in tbe business or that be was to receive back merely bis actual investment, and that bis note of $500 to Ficks was by reason of an understanding that be was to receive, so far as be and Ficks were concerned, only $6,500 instead of $7,000 for tbe sale of bis interest in tbe business.
Eor tbe appellant there was a brief by Gilbert & Fla, and oral argument by F. L. Gilbert and Emerson Fla.
Eor tbe respondents there was a brief by Olin, Butler, Stebbins & Stroud, and oral argument by Bay M. Stroud and Harry L. Butler.

Opinion:
Eschweilee, J.
Tbe disputes between tbe parties in this litigation are as to matters of fact only, that is, whether or not at tbe time of tbe agreement in October, 1911, tbe defendant was selling whatever interest be might have in tbe business for tbe lump sum of $7,000, or whether it was understood and agreed between tbe parties that be was to receive back whatever investment be might have made, and that that was but $6,000 instead of $7,000; and secondly, whether tbe $500 note made by defendant to tbe plaintiff Fieles was as security for the bad debts of the former copartnership, or whether it was, as defendant claimed, tbe deduction in tbe purchase price from $7,000 to $6,500. Defendant further contends that tbe payments to him by plaintiffs subsequent to tlieir discovery of tbe mistake as to tbe obligations to tbe bank amount to an estoppel or waiver of any present right to recover.
No useful purpose would be served by a lengthy discussion of tbe evidence. From an examination of tbe record we are satisfied that there is support therein for the several findings of the court below and that tbe court was justified in holding that there was a mutual mistake as to tbe amount actually invested by defendant, even though any mistake be denied by the defendant.
Under the circumstances disclosed the plaintiff Fieles, who alone recovers the $1,000, is not barred by any principle of estoppel or waiver from recovering the amount of the overpayment.
There was a dispute between the parties as to the object add purpose in giving the $500 note by defendant to Ficks, and in that dispute the court found in favor of the plaintiff, and under the familiar rule that governs under such circumstances that finding must also stand.
By the Court. — The judgment of the circuit court is affirmed.