Court Opinion

ID: 4009372
Source: CourtListenerOpinion
Date Created: 2016-07-06 11:09:33.936272+00
Date Added: 2024-06-11T13:43:11.360332
License: Public Domain

Action begun February 17, 1940, in the civil court of Milwaukee county by Atlas Investment Company against Andrew F. Christ and Joseph G. Jurinec to recover the sum of $2,500, with interest, upon a demand promissory note. The complaint alleged that defendant Andrew F. Christ executed and delivered the note to plaintiff; that defendant Joseph G. Jurinec, for valuable consideration, guaranteed the payment of said note by written indorsement thereon; that demand was made by plaintiff upon both defendants but that no payment had been made; and that plaintiff was the owner and holder of said note.
The defendants in answer to the complaint alleged:  That the note was executed in May, 1939, as part of a transaction in violation of sec. 176.17 (2) and (3), Stats., and was therefore void and unenforceable; that the defendants executed the note in order to finance a third person for the purpose of equipping a tavern, and that the Blatz Brewing Company represented that it "would furnish the sum of $5,000 to promote and equip the tavern, upon condition that the major portion of the beer and soft drinks to be dispensed in the tavern would be purchased from the Blatz Brewing Company over a period of five (5) years."  That the Blatz Brewing Company represented to the third-person licensee that it would pay a monthly rebate on beer and soft drinks to be applied on the payment of the $5,000.  That to circumvent the provisions of the statute, it was understood that the Blatz Brewing Company would furnish the money and that defendant Andrew F. Christ would act as go-between.  That the Blatz Brewing Company furnished two blank notes, each for the sum of *Page 116 
$2,500, that neither of said notes was filled in except for the amount payable; that defendants were given to understand that the name of the Blatz Brewing Company or its agent would be filled in and that such notes would be paid solely out of rebates, and that the principal was to be payable over a period of five years without interest.  That defendant Joseph G. Jurinec indorsed one note on the understanding that no attempt would be made to collect on said note and that payments would be made only in the form of rebates. That no authority was given the Blatz Brewing Company to insert the name of Atlas Investment Company as payee.  That plaintiff was "merely a subsidiary of the Blatz Brewing Company and was used in this transaction merely as a cover to attempt to circumvent the provisions of the Wisconsin statutes."
Although adverse examinations and affidavits filed by the parties failed to indicate that the plaintiff was a subsidiary of the Blatz Brewing Company there was some evidence tending to establish the transaction as alleged in the answer and to show that appellant Atlas Investment Company acted through agents of the Blatz Brewing Company in executing the note.  The civil court was of opinion that the alleged transaction with the Blatz Brewing Company did not fall within the scope of sec. 176.17 (2) and (3), Stats., and granted plaintiff's motion for summary judgment on the ground that the affidavits on defendants' behalf contained no showing that the Atlas Investment Company was a subsidiary of the Blatz Brewing Company and that there was therefore no showing of any facts sufficient to call for a trial, bringing the case within the summary-judgment statute, sec. 270.635 (2), Stats.
An appeal was taken to the circuit court for Milwaukee county and that court reversed the judgment of the civil court, reinstated the defendants' answer and remanded the cause for further proceedings.  This appeal is by the plaintiff from the order of the circuit court. *Page 117 
The purpose to be served by the summary-judgment statute so far as it relates to motions by plaintiff, is to prevent interposition of false or frivolous answers for the purposes of accomplishing a delay in the securing of a just judgment.  The statute is, however, drastic and is to be availed of only when it is apparent that there is no substantial issue to be tried.  Prime Mfg. Co. v. A. F. Gallun  SonsCorp. (1938) 229 Wis. 348, 349, 350, 281 N.W. 697. It is not a substitute for a regular trial nor does it authorize trial of controlling issues on affidavits.
The answer in this case sets out several claimed defenses, among them that the note was void and illegal; that no dealings were had with plaintiff; and that defendants are not indebted to plaintiff.  While the answer is not as definite and certain as it might be, the question of whether the plaintiff was a holder in due course was considered; and although the issue is raised only in a limited way it is present and this being on motion for summary judgment and not to make the pleadings more definite and certain, we treat it as though sufficiently pleaded.  McLoughlin v. Malnar (1941),237 Wis. 492, 495, 297 N.W. 370.  There appears from the affidavits and testimony taken on adverse examination some evidence that appellant conducted the transactions leading up to the execution of the note through agents of the Blatz Brewing Company and that these agents and the respondents reached an agreement, which, if it existed to appellant's knowledge, sets up a defensive matter and takes appellant out of the class of holder in due course. Secs. 116.18, 116.57, and 116.60, Stats.  These questions rest in circumstances over which a dispute exists *Page 118 
and because of this dispute the respondents are entitled to their day in court.
Under the facts as they appear upon this motion for summary judgment, the question as to whether the instrument was fraudulently put in circulation as to defendants is sufficiently raised, and when shown, the appellant has the burden of establishing that it is a holder in due course. Sec. 116.64, Stats.  See Kinney v. Kruse (1871),28 Wis. 183, 188; Brannan's Negotiable Instruments Law (6th ed. by Beutel, 1938), p. 717 et. seq., § 59; note (1922), 18 A.L.R. 18; note (1925), 34 A.L.R. 300; note (1928), 57 A.L.R. 1083.  This is the important issue.  Because of the disclosures in the record furnishing grounds for an inference that appellant is not so disassociated with the original transaction out of which the note comes as to be capable of being a bonafide holder in due course, we agree with the decision in the circuit court.
By the Court. — Order affirmed.