Case Name: Paulus, Respondent, vs. O'Neill, Executor, Appellant
Court: Wisconsin Supreme Court
Jurisdiction: Wisconsin
Decision Date: 1901-03-19
Citations: 131 Wis. 69
Docket Number: 
Parties: Paulus, Respondent, vs. O’Neill, Executor, Appellant.
Judges: 
Reporter: Wisconsin Reports
Volume: 131
Pages: 69–84

Head Matter:
Paulus, Respondent, vs. O’Neill, Executor, Appellant.
February 2 -
March 19, 1907.
Fraud: Recovery of money paid by participant: Court and jury: Waiver of right to have question submitted to jury.
After the death of one P., who was the holder of a note given by B. for $1,000, P.’s widow, having possession of the note and fraudulently intending to appropriate it to her own use, surrendered it to B. in consideration of a new note to her for $900, and B. afterwards paid to her $350 on the new note. Subsequently B.’s liability to the estate of P. on the original note was established, and recovery from the widow of the $350 paid to her was sought by B.’s executor. Upon the evidence (stated in the opinion) it is held that the question . whether B. was a party to the fraud, so that the amount paid by him could not be recovered, should have been submitted to the jury. ■
Timlin and Siebeckee, JJ., dissenting, are of the opinion that the right to have said question submitted to the jury was waived by B.’s executor, he having requested a special verdict; having presented the form thereof, not including that question, to the court; having made no objection to the verdict as submitted; having first brought the question to the attention of the'court, after the jury were discharged, by a motion for judgment which assumed the right and duty of the court to pass upon the question; ^and not having moved for a new trial after such motion for judgment was denied.
Appeal from a judgment of the circuit court for Clark county: E. W. Helms, Judge.
Reversed.
John Paulus during Ms life held a note of $1,000 against Lemont E. Brown. Paulus died December 11, 1902. Shortly after Ms death his widow, Rilen Paulus, had possession of the note, and surrendered it to Brown for a new note of $900 executed by Brown and payable to her. On the 13th day of October, 1903, Brown' paid $350 on this $900 note. On November 19, 1903, Brown died. The $1,000 note was filed against Brown’s estate by the administrator of the Paulus estate.' The executor of Brown’s estate, James O'Neill, defendant and appellant here, defended the claim on the $1,000 note. The claim on the $1,000 not was allowed against Brown’s estate. The claim for balance due on the $900 note was filed against Brown’s estate by Ellen Paulus, plaintiff and respondent here, and defended by the executor of Brown’s estate, and also a counterclaim set up' by him to recover the $350 paid on this $900 note by Brown.
In the county court all of these claims were tried together, and the trial resulted in judgment against Brown’s estate allowing the $1,000 claim in favor of the Paulus estate and disallowing the claim of plaintiff, Ellen Pandus, for balance due on the $900 note, and allowing the counterclaim for the $350 and interest in favor of the Brown estate and against Ellen Paulus. The plaintiff, Ellen Paulus, appealed to the circuit court. The case was tried by the court and a jury. The defendant demanded a special verdict, which was submitted. The jury found as follows:
“1. Was John Paulus at the time of his.death on December 11, 1902, the owner and in the possession of the $1,000 note executed to him by Brown? A. Yes. 2. Was said note ever paid to John Paulus in his lifetime? A. No. 3. Did said $1,000 note come to the possession of Ellen Paulus after the death of her husband? A. Yes. 4. Did Ellen Paulus surrender and deliver to Brown said $1,000 note in consideration for the note of $900 signed by Brown payable to Ellen Paulus and dated January 14, 1903 ? A. Yes. 5. Was such surrender and delivery by Ellen Paulus of said $1,000 note to Brown the sole and only consideration received by Brown for the making of said $900 note ? A. Yes. 6. Did Lemomt E. Brown pay to the plaintiff, Ellen Paulus, on October 13, 1903, the sum of $350 on said $900 note which was indorsed thereon? A. Yes (by the court).”
The court ordered judgment dismissing the claim of the plaintiff for balance due on the $900 note and dismissed the defendant’s counterclaim. The circuit judge rendered a decision in writing, in which he held that the transaction be tween Ellen Paulus and Lemont E. Brown which resulted in tbe surrender of tire $1,000 note and tbe execution of tbe $900 note was fraudulent, and that every inference from tbe facts proved seemed to point to unlawful motive on tbe part of both plaintiff and Brown, and that none of tbe inferences pointed tbe other way, bence tbe counterclaim should be dismissed ; that in so far as tbe fraudulent purpose bad ripened into action by tbe payment of tbe $350 it should not be disturbed. Defendant appealed to this court from so much of tbe judgment as dismissed the counterclaim.
For the appellant there was a brief by Grow & Campman, attorneys, and J. R. & C. R. Sturdevant, of counsel, and oral argument by Charles F. Grow.
For the respondent the cause was submitted on the brief of W. F. Bailey.

Opinion:
Kerwin, J.
It is established by tbe verdict on the trial below that John Paulus was tbe owner of tbe $1,000 note at tbe time of bis death, that tbe same was unpaid, and came into tbe possession of bis widow, Ellen Paulus, shortly after bis death; that she surrendered it to Brown in consideration of tbe $900 note payable to her; that such surrender was tbe only consideration received by Brown for tbe $900 note; and that on October 13, 1903, Brown paid to Ellen Paulus $350 on tbe $900 note. Erom tbe findings of tbe jury it appears that Ellen Paulus intended by tbe exchange of tbe $1,000 note for tbe $900 note to appropriate to her own use tbe $1,000 note belonging to tbe Paulus estate. Tbe main question upon this appeal is whether Brown participated in such fraudulent transaction and knew, or ought to have known,, that Ellen Paulus was not tbe owner of tbe note.
In talking with Mr. Sturdevant in January after tbe death of John Paulus, Brown exhibited tbe note and claimed it bad for tbe money be borrowed to put on tbe mill, and be said it been paid. Mr. Sturdevant asked him if tbe note was given was, and that tbe administrator wanted him to pay tbe $1,000 over again, and said: "If I have my note, doesn't that show I paid it ? Ain't I all right if I have my note ?" To which Mr. Sturdevant replied: "I don't know as to that. The note is pretty good evidence it is paid, but who did you pay it to?" To which Brown replied: "What difference does that make so long as I have my note ?" It also appears from the evidence that Mr. Sturdevant asked him if he paid it to Mr. Paulus, and Brown replied: "If I have my note, ain't that all right ?" but did not state to whom he paid it. The testimony also shows that he was given to understand at this time that the amount of the note would have to be paid to the estate, and that he said, in effect, he could pay it again if he had to.
Under this evidence mainly, in connection with the facts established by the verdict, the court below found fraudulent participation on the part of Brown as a matter of law. The appellant insisted that the court erred in indulging in a presumption of fraud, and that if there was any evidence in the case sufficient to raise the question it was a question of fact and should have been submitted to the jury. It is well settled that fraud can be established only by evidence that is clear and satisfactory. Bowe v. Gage, 127 Wis. 245, 106 N. W. 1074; Shaw v. Gilbert, 111 Wis. 165, 86 N. W. 188; F. Dohmen Co. v. Niagara F. Ins. Co. 96 Wis. 38, 71 N. W. 69. We cannot find that there is such clear and satisfactory-evidence as would justify'the court below in holding that fraud upon the part of Brown was established as a matter of law and therefore the question should have been submitted to the jury.
By the Court. — That part of the judgment appealed from is reversed, with costs, and the action remanded for a new-trial upon the counterclaim.