Court Opinion

ID: 6734689
Source: CourtListenerOpinion
Date Created: 2022-07-20 23:17:22.113142+00
Date Added: 2024-06-11T16:01:43.798342
License: Public Domain

ON RE-HEARING.
Counsel for plaintiff very earnestly press upon us the reconsideration of the point which seemed to us so clear that we did not discuss it at length. They concede the doctrine of merger, and the rule that the supplement bill must not embody facts creating an independent cause of action. Their whole contention ranges around the question, what is the real cause of action in this case? They insist that the debt is the primary right, and that this right, in connection with defendant’s failure to respect it, constitutes the cause of action. Hence it follows, they urge, that that cause of action was not extinguished by the judgment, but exists today as much as ever it did, despite the fact that it has assumed a new form. There is much ambiguity on this subject. Jurists have found it difficult to define with precision the meaning of the phrase “cause of action.” While it may be that this is a difficulty which inheres in the subject itself, and is therefore unsurmountable, yet we do not consider that there should be, despite this fact, much controversy in a case like this as to the cause of action set up in the original complaint. If counsel’s claim that the debt is the cause of action be sound, then there is no distinction between an action for services, for goods sold, and for money loaned. In each case there is a debt. But in no two of these suppositive cases did the debt grow out of the same facts. In each of these cases the peculiar distinctive facts out of which the obligation arises are what constitute the cause of action, when coupled with the omission of the defendant to respect the plaintiff’s rights thereby established. It is not the mere existence of a debt — an element common to them all — which constitutes the cause of action in either of these cases. If the debt were the cause of action, it would be unnecessary for the *235plaintiff to do more than aver in his complaint that the defendant was indebted to him in a specified sum. On this theory the same complaint would do for all actions belonging to these three classes. All that it is necessary for the pleader to do in any case is to set forth' the facts constituting his cause of action. No one would think of stopping with a bare allegation of indebtedness; and yet this is all that is required if that indedtedness alone constitutes the cause of action. There is an element common to all causes of action, but it does not of itself constitute a cause of action. In every case there is present the fact that the defendant has neglected to .observe his legal duty to the plaintiff. In an action at law to recover money, the cause of action is not simply the withholding of the money from the plaintiff by the defendant. In a sense, that may be said to be the legal wrong for which the law furnishes a remedy. But why is it a wrong of which the law takes cognizance? Because, and only because, by reason of certain antecedent facts, the plaintiff has become vested under the law with a right to demand the money. In seeking for one element of the cause of action, we must go back of the mere right to demand that the money claimed shall not be withheld, and ascertain what are the particular facts out of which that right springs. When we have discovered these facts, we have found out that which differentiates the particular cause of action from another,'which, while showing, perhaps, an indebtedness of like amount, arises out of different circumstances. The cause of action is always disclosed by the answer to the inquiry: “How did the defendant become liable to be prosecuted by the plaintiff in this particular action?’’ It is true that a cause of action is not in cases of contracts complete until the defendant has failed to pay in accordance with his legal obligation. But the foundation for it is, in all such cases, laid before the default occurs; and in many instances this element of default is not a constituent part of the cause of action, as in tort cases, where the cause of action accrues the moment the wrong is committed. No one would speak of the failure of a slanderer of character to indemnify the person *236vilified as constituting the latter’s cause of action. It is the slander which forms the plaintiff’s cause of complaint in such a case. A plaintiff may have three different causes of action-against the same defendant, — one for money loaned, one for goods .sold, and one for services rendered. If in each case the withholding of the money alone is the cause of action, then all of - the causes of action are identical in chax'acter. Would this be seriously claimed by any one?
We have used these few obseivations for the reason that the plaintiff’s counsel seem to take the position that in this case the witholding of the money constitutes the cause of action. We will now tuim to the plaintiff’s contention that the debt, coupled with defendant’s default, is the cause of action. If the mere fact that thei'e is a debt, independently of the circumstances out of which such debt arose, constitutes the cause of action in any case, then all legal distinctions are in this x'egard obliterated. The real essence of this contention is that, in all cases to x-ecover money, it is the original obligation to pay, in connection with defendant’s default, which constitutes the plaintiff’s cause of action. If this be so, then a cause of action for libel is not affected by the fact that the defendant has, in full settlement of the claim, given his note for a cei-tain sum of money. A note is not actual payment. The oi'iginal obligation to pay damages lies at the basis of such note. It is, in substance, the same claim as the original claim for damages. So, it is after judgment upon the note. But the cause of action is not the same in each case. The statute of -limitations as to each is different. The action for libel -would, have to be brought within two years after that cause of action accrued. The action upon the note would have to be commenced within six yeai's after that new cause of action, x'esting upon different facts, accx-ued. And the action upon the judgment could be instituted within 10 years after that cause of action, based upon still different facts, had accrued. Rev. Codes §§5200, 5201, 5203. Sections 5199 to 5201, Rev. Codes, differentiate a cause of action upon a judgment from the cause of action upon the claim upon *237which it was rendered. Under these provisions, an action upon contract must be brought within six years after that cause of action accrues; and an action upon a judgment rendered upon the same contract may be brought within ten years after that cause of action — that new and distinct cause of action — accrues. How can it be said that a cause of action upon a judgment accrues if no cause of action upon it does in fact accrue, but the old cause of action, for the original claim, still continues unaffected, and the judgment is only the same cause of action in another form ? No judgment for. money ever has been or ever can be rendered of which it cannot be as truthfully said as of this judgment in the case at bar that it is only the original claim in another form. Is it a fact that lawyers, judges, and codifiers have so long been mistaken in supposing that a distinct cause of action upon a judgment accrues when the judgment is rendered. The fact that the same debt lies at the foundation of distinct causes of action does not render them identical. If one who has borrowed money fails to pay it, a cause of action against him for money loaned exists. If his creditor thereafter takes the debtor’s note in full payment, the old cause of action is extinguished, and a new one is created. The fact that there was an original debt is important only for the purpose of showing a consideration for the note. But an action upon such a note, under such circumstances, cannot be regarded as an action for money loaned. The original cause of action'in the-case supposed has been wiped out. If, in turn, a bond should be executed in payment of the note, the cause of action on the note would, in turn, be destroyed. If judgment should finally be recovered upon such bond, the cause of action upon the bond would likewise be extinguished. In the case supposed, there would exist, in succession, four distinct causes of action, all founded upon the same debt, which had at no time been paid, despite all the various changes which had taken place in the form of the evidences of such indebtedness. Would counsel for plaintiff seriously contend that in such a case there existed at all times only one cause of action, — the original cause of action, for money *238loaned ? Pushed to its logical consequences, the doctrine contended for would make it necessary for a court to apply to an action upon the judgment here involved the statute of limitations applicable to the original cause of action, the six years statute of limitation. All must agree that no action upon the notes can be maintained after judgment. This is conceded. All will assent to the proposition that the action must be maintained upon the judgment. And yet if it is the same cause of action as that upon the notes, or for the original debt, the six-years statute of limitation governs. This will be true in all cases. The consequence will be that in every instance the statute of limitations applicable to the cause of action upon which the judgment is founded will govern in actions upon such judgment. Would counsel for plaintiff concede -that their cause of action upon this judgment would be barred in six years? Here is a decisive test.
It is urged that the facts set up in the supplemental complaint do not of themselves constitute a cause of action, independently the facts alleged in the original complaint; that the execution of the notes or the existence of the original debt is an essential element of the cause of action upon the judgment. We can see no force in this claim. The judgment is the cause of action, irrespective of the character of the claim on which it rests. No averment as to the nature of such anterior cause of action is necessary or even proper. Such an allegation would be stricken out as surplusage. In an action upon a judgment, the only inquiry which a court will make is whether there is a valid judgment, unsatisfied and unpaid. The test as to the necessity of an allegation in a complaint is whether that specific fact need be proved to make out a case. When a judgment is sued upon, it is a matter of no moment what lies behind the judgment, if it is valid; or, indeed, whether there was any claim behind it at all. That question is forever foreclosed by the judgment itself. If an allegation as to the existence of the notes set forth in the original complaint is vital to the cause of action upon the judgment, then issue upon that fact might be taken by the defendant. Will it be urged that *239the defendant would be allowed to go into that question in a suit upon the judgment which had forever set that question at rest? Section 5291, Rev. Codes, provides that the plaintiff cannot unite in the same complaint a cause of action' for slander and another cause of action based upon a contract. If the same defendant should thrice slander the same plaintiff, and judgment for one of such slanders should be recovered by the plaintiff, and th,e defendant should give him his note in settlement of the damages sustained by him by reason of another thereof, would it be contended that thereafter the' plaintiff might, in the same complaint, join the cause of action upon the judgment and the cause of action upon the note with the cause of action for the third slander, on the ground that the note and the judgment had not changed the essential nature of the original causes of action for the two slanders, but had merely given the original, obligations to pay damages for such slanders another form? In all causes of action there exist, as we have before observed, two fundamental elements. There are the facts which create the obligation. There is the other fact that that obligation has not been respected. In this action, as originally instituted, upon the notes, the fact which constituted the obligation was the execution and delivery of notes for a consideration. The default of the defendant was in failing to pay them when due. But neither of these particular elements enters into the cause of action upon the judgment. The obligation in the latter case is created by the judgment, and not by the notes. The default is the failure to pay such judgment, and not an omission to pay the notes, which can no longer be paid, because the judgment has as completely extinguished any cause of action upon them as payment would have done. How can a cause of action based Upon one kind of obligation arising out of a certain fact, coupled with a failure to discharge that obligation, be the same cause of action as that which rests upon another and different obligation, springing out of a new fact, coupled with a a failure to comply with such new obligation. Every cause of action is the invasion of the plaintiff’s rights by the defendant, or *240the latter’s failure to discharge some legal duty to the plaintiff. If a defendant assaults a plaintiff, he invades his rights. If he omits to pay when due his note held by the plaintiff, he fails to discharge a legal duty to the plaintiff. In each case, these respective elements constitute the plaintiff’s cause of action. A court, in determining whether the defendant has invaded plaintiff’s rights, or neglected to discharge a legal duty which he owes the plaintiff must make the preliminary inquiry as to the facts out of which plaintiff’s alleged rights arises. If that right rests upon the defendant’s obligation to pay a note, it is that particular right, in connection with defendant’s failure to respect it, that constitutes the plaintiff’s cause of action. If it rests upon the defendant’s obligation to pay a judgment rendered against him upon such note, it is that particular right, in connection with the defendant’s disregard of it, which constitutes that particular cause of action. This is the utmost scope of Prof. Pomeroy’s language in his work on Remedies and Remedial Rights (§453). The primary right therein referred to is the plaintiff’s right in. the particular case. If it rests upon contract, it must stand upon the particular contract sued upon. A plaintiff’s primary right in an action upon a note is the defendant’s duty to him which the note creates. When a judgment is rendered upon such note, the primary right is the defendant’s duty to the plaintiff created by such judgment, and not by the note, which has ceased to be the source of any duty of the defendant to the plaintiff.
Counsel essay to distinguish the case of Wattson v. Thibou, 17 Abb. Prac. 184, from the case at bar. We are unable so to distinguish it. It is true that the notes in that case were not extinguished by a judgment, but by bonds received in payment thereof. But wherein does this difference affect the principle? The original debt had not been paid by the bonds, any more than the original debt in this case has been paid by the judgment. Accepting such bonds in satisfaction of the notes is strictly analogous to recovering judgment upon notes in the case at bar, and thus extinguishing them as subsisting obligations. Each act *241is the voluntary act of the creditor. Whether he, in terms, extinguishes the original cause of action, or invokes the powers of a court of justice to do that which has the same effect, — i, e. render a judgment upon such original cause of action, — is immaterial. Nor does it make any difference that the act of extinguishing the original cause of action by accepting a new obligation is called “novation,” whereas the act of destroying such cause of action by the recovery of judgment is not called “novation,” but “merger.” The vital question is: Has the original cause of action been destroyed, and a new one substituted for it? The very argument made by counsel for plaintiff in this case could have been employed by the court in the Wattson case to justify the allowance of plaintiff’s motion that he be permitted to file a supplemental complaint. The court could have said with as much truth as can be here asserted that the original debt had not been affected, but only a new evidence of indebtedness substituted for the old. But this was not regarded by the court in that case as at all important. The court saw and held that a cause of action upon bonds was not the same as a cause of action upon notes previously given, although the same debt furnished the consideration for each of these classes of obligations.
It is urged that we did not speak with precision when, in distinguishing the case of Jenkins v. Bank, 127 U. S. 484, 8 Sup. Ct. 1196, we asserted that the cause of action in that case was the lien sought to be foreclosed. We fail to discover our error in this respect except that we should have spoken of the lien as constituting the cause of action when coupled with defendant’s failure to perform his legal duty to satisfy the lien. It is said that if the lien constituted one element of the cause of action in that case, in contradistinction from the debt, the indebtedness need not have been set up in the complaint therein; that it would have been necessary to refer to nothing but the lien in the bill. But a lien presupposes a debt. It cannot exist without one. A lien is the legal grip of a debt upon property. When it is said *242that a lien constitutes an element in a cause of action in a particular case, the assertion is made that this grip of a debt upon property is the cause of action which the plaintiff is seeking to enforce by a foreclosure suit. In an action to •foreclose a lien, the lien is the main thing. It is illogical to speak of the lien being a mei'e incident of the debt in such a case. The debt is a component pax't of the lien, and not something separate from it, of which the lien is a mere incident. One who has secured a lien upon propei'ty is vested with an equitable cause of action, distinct fx'om his mex'e legal cause of action to recover a pex'sonal judgment against .the debtor. It is the lien, and not the mere debt, which gives him that equitable cause of action. If the indebtedness constitutes the cause of action in such a case, then an action to fox'eclose a lien is an action at law, the same as an action against the debtor to recover a mex-e money judgment, for the cause of action in each case is the same, — i. e. the debt. A plaintiff brings an action on a note, and also an action to fox'eclose a lien which secui'es such note. Are the two actions the same? All know that they are not. What distinguishes them is the lien. When the suit is to foreclose the lien, the cause of action is the lien to be foreclosed, coupled with defendant’s default. When the object of the action is to obtain a money judgment merely, the note, coupled with defendant's default, constitutes the cause of action. If, in a foreclosure action, the lien is not one of the elements in the cause of action, in contradistinction fi'om the debt, we are at a loss to know what, in such a case, does, in fact, constitute one of the elements of the cause of action. If a complaint in a foreclosure action should fail to allege the existence of the lien, it would be demurrable. When it does properly set forth the fact of a lien, it necessax-y contains an averment as to the debt, for this is an essential ingi'edient in every lien. A lien is not alleged unless a debt of some chax'acter is set up. But the debt is not stated in the pleading, as the substantive cause of action, but merely to make complete the allegations of the complaint as to the existence of a lien, the lien being the real cause *243of action sought to be enforced by the suit, when coupled with defendant’s failure to satisfy it. A cause of action is that which enables the plaintiff to maintain the particular action he seeks to prosecute. What is it that gives the plaintiff a right to institute and carry on a suit to foreclose a lien if it is not the lien itself, in connection with the debtor’s default?
It is insisted that the change proposed to be made by the supplemental complaint is one which relates to the form of the action only. We are unable to assent to this view. If the plaintiff had brought debt upon the judgment in question after the same had been rendered, and if forms of action had not been abolished by the code, and if it were the doctrine in this country, as in England, that a foreign judgment is not a record, and hence that an action of debt would not lie thereon, then in case the plaintiff should seek to change his action from debt to assumpsit, we would have the mere question of a change in the form of the action, the cause of action remaining the same. But it is not a change of this character which is attempted in this case. The plaintiff is not essaying to alter the mere form of his action (a thing never done by supplemental complaint,) but to bring into the case an entirely new cause of action. He seeks to eliminate from the complaint a cause of action which, since the commencement of this action, has been extinguished, and substitute in its place a new cause of action, which accrued after this action was instituted.
It is urged that the New Jersey case is not in point, for the reason that no radical changes had been made by statute in that state in the rules of procedure. But we have seen — and counsel for plaintiff assent to this conclusion — that the statute of this state regulating the filing of supplemental complaints has not altered the old rule that a new cause of action cannot by such means be substituted for the old. Nor is there anything in the language or spirit of our code which in any manner affects the significance of the phrase “cause of action.” On the contrary, several provisions of the code to which we have referred *244conclusively show that the old meaning of that phrase has not been disturbed. That which before the code system was adopted was not the cause of action, is not now the cause of action. It is therefore apparent that the statutory regulations of practice in this state have in no respect affected the two inquiries which lay at the foundation of the decision in the New Jersey case, and which also lie at the basis of our judgment in this cause, — i. e.\ Can a new cause of action be substituted for the original by supplemental complaint? Does a new cause of action arise in this country when a judgment is recovered upon a claim in any of the courts thereof? The importance of this question to the profession is our apology for the length of this additional opinion.
(69 N. W. Rep 455.)
The petition for a rehearing is denied.
Wallin, C. J., concurs.
Note — See Ch. 50, Laws 1897.