Court Opinion

ID: 4010027
Source: CourtListenerOpinion
Date Created: 2016-07-06 11:11:09.121104+00
Date Added: 2024-06-11T07:44:42.032760
License: Public Domain

This is an action by Agnes Wall Frank, commenced on October 19, 1940, against Walter Schroeder, defendant, to recover upon an alleged guaranty of real-estate bonds by defendant.  The complaint alleges that on May 1, 1928, Breithaupt Realty Company of Milwaukee executed a deed of trust to Chris.  Schroeder  Son Company and Fred W. Krueck, Milwaukee, as trustees, to secure the issue of certain *Page 160 
first-mortgage bonds to be sold by Chris.  Schroeder  Son Company.  That on August 11, 1928, defendant under seal executed an unconditional guaranty of these bonds.  The guaranty states its purpose to be to obtain from the railroad commission of Wisconsin a permit for the sale of the bonds, and to that end to improve the security of the bonds.  According to the terms of the bonds defendant guarantees the prompt payment of principal and interest on each and all of the said bonds and "performance by the said Breithaupt Realty Company of all of its obligations of said trust agreements." The guaranty is under seal and is "signed, sealed, and delivered in presence of" two witnesses.  It is further alleged that on August 20th, in reliance upon the guaranty, the railroad commission issued a permit for the sale of the guaranteed bonds, and that certain bonds were sold under the permit to one John H. Wall of Milwaukee; that Wall died on September 13, 1935, and that on the 23d of March, 1936, his will was admitted to probate, and William H. Wall and Agnes Wall Frank appointed executors; that on December 21, 1936, the final decree of the county court assigned certain of the guaranteed bonds to plaintiff, Agnes Wall Frank.  The complaint further alleges default by the Breithaupt Realty Company, and demands judgment against defendant upon the guaranty.  The answer admits execution of the guaranty set forth in the complaint but denies that any consideration was given for its execution.  Defendant further sets forth as a defense that the guaranty was given in response to a demand by the railroad commission for a guaranty in order that the underwriter might receive a permit for the sale of the bonds; that after various conferences and after the mailing of a duplicate of the guaranty to the railroad commission the requirement for a guaranty was abandoned and that there never was a valid delivery of the guaranty; there having been issued to underwriter on August 20, 1928, a Class B permit to sell without the requirement of a guaranty. As a further defense the provisions of sec. 281.22(4), Stats., *Page 161 
are set forth, this being the moratorium statute prohibiting actions at law except for foreclosure where the evidence of indebtedness is secured by a mortgage on real estate.  Thereafter plaintiff moved for a summary judgment, and both parties filed supporting affidavits' which need not be summarized. These affidavits deal entirely with issues of delivery and interpretation.
The trial court denied the motion for a summary judgment and filed a memorandum decision expressing the view that substantial issues of fact were disclosed by the pleadings. From an order entered denying a summary judgment plaintiff appeals.
The following opinion was filed October 7, 1941:
While briefs on this appeal are largely devoted to the question whether any triable issues of fact are presented by the record with respect to, (1) interpretation of guaranty; (2) the application of sec. 281.22, Stats., as a defense; and (3) nondelivery of the instrument, we deem this case determined at the outset adversely to appellant upon the issue of consideration.
The answer denies any consideration for defendant's guaranty. No attack by affidavit is made upon the issue thus raised by defendant.  It is plaintiff's claim that as a matter of law no defense of want of consideration may be set up since the guaranty was under seal, and since, as held in Jost v.Wolf, 130 Wis. 37, 110 N.W. 232; Bibelhausen v. Bibelhausen,159 Wis. 365, 150 N.W. 516; Bradley Bank v.Pride, 208 Wis. 134, 242 N.W. 505, an instrument under seal conclusively imports consideration and the defense of no consideration raises an immaterial issue. *Page 162 
The vice in plaintiff's argument is that the doctrine of these cases applies to executed contracts under seal.  In Singer v.General Acc., F.  L. Assur. Corp. 219 Wis. 508,262 N.W. 702, it was pointed out that sec. 328.27, Stats., provides that with respect to an executory contract the seal shall be merely presumptive evidence of consideration.  The seal is conclusive of consideration only in the case of executed contracts.  It was therefore open to defendant to show that in fact there was no consideration for the execution of the guaranty and upon the record as it stands defendant has raised a legally material issue.  There is nothing in the affidavits to indicate that it is not a substantial issue of fact.  In view of this the trial court could not properly have entered a summary judgment and we consider it to be neither necessary nor expedient to consider the merits of the other contentions upon this appeal.
By the Court. — Order affirmed.
A motion for a rehearing was denied, with $25 costs, on December 2, 1941.