Court Opinion

ID: 7098248
Source: CourtListenerOpinion
Date Created: 2022-07-24 12:13:11.750957+00
Date Added: 2024-06-11T16:13:19.450383
License: Public Domain

Beok, Ch. J.,
dissenting. — I think the court erred in sending the case to a referee. This point I will briefly examine. The statute upon the subject of reference demanding consideration in this ease is found in the following provisions of the Code:
“Section 2815. All or any of the issues in an action, whether of facts or of law, or both, may be referred upon the consent of the parties, either written or oral, in court, entered upon the record.
“Section 2816. When the parties do not consent the court' may, upon motion of either, or upon its own motion, direct a reference in either of the following cases:
“1. When- the trial of an issue of fact shall require the examination of mutual accounts, or when, the account being on one side only, it shall be made to appear to the court that ■it is necessary that the party on the other side should be examined as a witness to prove the account, in which case the *386referee may be directed to hear and report upon the whole issue, or upon any specific question of fact involved therein; or—
“2. When the taking of an account shall be necessary for the information of the court before judgment, or for carrying a judgment or order into effect; or—
“3. When a question of fact shall arise in any action by equitable proceedings, in which case the court, in the order of reference, shall prescribe the manner in which the testimony shall be taken on the trial. ”
It will be observed that, without the consent of the parties, references may only be had in cases cognizable in equity. The settlement of mutual accounts, and the taking of accounts contemplated in the first and second paragraphs of section 2816, are matters, it is presumed, of which a court of chancery has jurisdiction. It is not intimated, however, that when issues arise in actions at law involving matters of this character, they may not be referred without consent of the parties.
It is claimed by plaintiff that the issues of fact in the case required the examination of mutual accounts, and that the defendant’s answer, setting up his cross-claim, presents an equitable cause of action. Upon this ground the ruling of the court ordering the reference seems to have been made. It, therefore, demands consideration.
Let me state briefly the issue in the case. The petition claims to recover for money received by defendant. The receipt of the money is admitted in defendant’s answer. TTis liability therefor is denied on the ground that it was applied toward the payment of a sum due from plaintiff under the ■contract. It is plain that the issues arising upon the petition do not require such settlement or examination of mutual .accounts as to bring the case within the statute above quoted. We do not understand this is claimed by plaintiff’s counsel. The issues upon the petition; therefore, require no further ■consideration.
The cross-petition of defendant sets up a contract with *387another party, under which he rendered services for which he was, by the terms of the contract, to be paid a certain compensation. It is alleged that plaintiff assumed the performance of this contract. The original contract, as well as the contract of plaintiff, is denied in the answer to the cross-petition. Special defense, as that the contract is within the statute of frauds and is without consideration, is also pleaded. It is impossible to say that these issues involved the examination of mutual accounts. The plaintiff does not claim to hold any account against defendant, other than that set up in the petition, which, being admitted by the defendant, is not in issue.
The defeiidant’s claim against plaintiff rests upon an alleged contract for service-3. While defendant may be said, in common language, to hold an “account” against plaintiff, we think his claim is not a matter of “account” of which equity takes cognizance. Under all contracts for services “accounts” of like character may exist. The “account” in this case may be unusually prolix, and require a long time to adjust it, but these are not grounds of equitable cognizance. The mere fact that a case involves'the examination of an account, using the word in its common acceptation, will not give chancery jurisdiction thereof.
In order to understand this subject clearly, attention must be given to the doctrines and rules of equity applicable to this subject. They are familiar to the profession, and cannot be the subject of controversy. They are summarized by Justice Story in the following language:
“So that, on the whole, it may be laid down as a general doctrine that in matters of account growing out of privity of contract courts of equity have a general jurisdiction where there are mutual accounts; and a fortiori where these accounts are complicated, and also where the accounts are on one side, but a discovery is sought and is material to the relief. And, on the other hand, where the -accounts are all on one side, and no discovery is sought or required; and, also, where there *388.is a single matter on the side of the plaintiff seeking relief, and'mere set-offs on the other side, and no discovery is sought or required, in all such cases courts of equity -will decline taking jurisdiction of the cause. The reason is that no peculiar remedial process or functions of a court of equity are required; and if, under such circumstances, the court were to entertain the suit, it would merely administer the same functions in the same way as a court of law would in the suit. In short, it would act as a court of law.” 1 Story’s Equity Jurisprudence, § 459. See, also, McMartin v. Bingham, 27 Iowa, 234.
It is not claimed that there are mutual accounts in the case, nor is a discovery claimed. '
The trial may involve the examination of many items which constitute the claim of defendant. This does not give equity jurisdiction. It may involve the examination into the state of the accounts of the two contracting companies, of Blair and of plaintiff, relating to the purchase and sale of lands and-lots; but defendant does not base his right to recovery upon these accounts, and plaintiff cannot claim that they are accounts against defendant. They are examined for the purpose of determining the amount of compensation defendant ought to recover under the terms of the contract. Facts disclosed therein constitute the basis of compensation in such investigation.
I reach the conclusion that the District Court erred in ordering the'reference without the consent of the parties, and that the judgment of the District Court ought to be
Reversed.