Opinion
December 5, 1955 —
January 10, 1956.
APPEAL from a judgment and order of the circuit court for La Crosse county: LINCOLN NEPRUD, Circuit Judge. Reversed.
For the appellants there were briefs and oral argument by Hubert V. Fuller of La Crosse, attorney, and J. Gilbert Hardgrove of Milwaukee of counsel.
For the respondent there was a brief by Bosshard Arneson of La Crosse, attorneys, and Clifford G. Mathys of Madison of counsel, and oral argument by Mr. Philip G. Arneson and Mr. Mathys.
This action was commenced on March 18, 1952, by Anton Linker, as plaintiff, against Batavian National Bank, a banking corporation of La Crosse, and Gysbert Van Steenwyk, an officer and director of said bank, as defendants. Served simultaneously with the summons was a notice for the discovery examination of Herman O. Klein, president of the bank. On March 25, 1952, the defendants obtained from the court an order to show cause why the discovery examination of Herman O. Klein should not be quashed or limited. The adverse examination of Herman O. Klein was held on April 8, 1952. Pursuant to demand by Messrs. Lees and Bunge, attorneys for defendants, a complaint was served on May 1, 1952. Thereafter at the instance of the defendants, an order was served upon the plaintiff to show cause why the complaint should not be made more definite and certain. Prior to the time set for the hearing of said order to show cause and on June 6, 1952, an amended complaint was served upon the defendants.
In his amended complaint the plaintiff, Anton Linker, alleged that he is the owner and is entitled to the possession of 1,510 shares of the common stock of La Crosse Floral Company the same being the split shares of original stock held by him, the present value being $23,650, and upon which dividends in the amount of $6,699 were paid to the defendant Van Steenwyk from 1946 to 1950; that on June 2, 1936, the defendant bank was in possession of the stock as collateral security for a note given to it by Linker; that on or about July 2, 1936, as plaintiff is informed, the bank by private sale at $1 per share transferred its interest in the stock to Herman O. Klein, then and now president of the bank; that such transaction was consummated without notice to Linker; that the transfer was entered on the books of the company and that a certificate of the stock was issued to Klein; that subsequently the stock was transferred to the defendant Van Steenwyk who at the time was and still is an officer or director of the bank.
It was further alleged that on March 13, 1952, Linker tendered $27,500 to the bank in satisfaction of all obligations collateralized by the stock; that the tender included the sum of $151 together with interest thereon from July 2, 1936, which sum as plaintiff is informed and believes, represents the amount credited to Linker by payment of the alleged sale of the stock, and that said tender included every obligation of Linker to the bank which was the basis of the pledge; that the tender has been kept good by a deposit of said amount with the clerk of the circuit court for La Crosse county, where it still remains.
The plaintiff prayed judgment for recovery of the possession of the stock or for the sum of $30,349, the entire value thereof, in event a delivery of the stock could not be had.
Subsequent to the service of the amended complaint, Attorney T. A. Schuessler of the law firm of Lees Bunge, who then represented the defendants, made request on several occasions to plaintiff's counsel for additional time within which to answer. The requests were granted. On September 29, 1952, plaintiff's counsel addressed a letter to defendants' attorneys (specifically to the attention of Attorney Schuessler), requesting an answer within five days and reminding the sendee of the agreement that the extension had been granted upon express condition that the answer would be filed in time to enable the parties to bring the matter on for trial at the fall term of court (which commenced on October 27, 1952). On October 10, 1952, plaintiff served notice returnable October 20, 1952, of an application for default judgment. On October 22, 1952, Frank H. Grover, a circuit court commissioner, issued an order returnable on October 24, 1952, requiring the plaintiff to show cause why the complaint should not be dismissed or made more definite and certain, and directing "that in the event defendants' motion is denied, defendants' time for answer be and hereby is extended twenty days from the date of such denial." An affidavit of Attorney Schuessler was filed in opposition to the application for default judgment. One of Attorney Arneson was filed in support thereof. The affidavit of Attorney Schuessler dated October 22, 1952, alleged that the letter of September 29, 1952, had not come to his attention for reasons that it was misplaced while the offices of his firm at La Crosse were being remodeled, and that he was then and thereafter spending time at the offices of the firm in another city. Attorney Schuessler alleged that upon receipt of the notice of application for default judgment, he proceeded as expeditiously as possible to take (upon oral stipulation of the parties) the adverse examination of Anton Linker. He further alleged that the plaintiff was not prejudiced by the defendants' failure to answer up to that time, and he sought leave to answer or otherwise plead to the amended complaint. In an affidavit dated October 24, 1952, Attorney Arneson detailed events in the case which had occurred up to that time, and asserted that the delay in answering the amended complaint and in prolonging the litigation was inimical to the interests of the plaintiff who was advanced in age and was in precarious health. On October 24, 1952, Hon. LINCOLN NEPRUD, presiding judge, proceeded with a hearing upon the application for a default judgment, and also upon the order to show cause to dismiss the amended complaint or make it more definite and certain. At the conclusion of the hearing, the court took the matters under advisement and requested briefs from counsel which were subsequently furnished. On December 29, 1954, the court in a memorandum decision determined that the defendants had been in default and that the plaintiff was entitled to judgment in accordance with the relief sought in the complaint. On January 3, 1955, the court permitted a hearing with respect to the value of the stock. On January 4, 1955, default judgment was rendered in favor of the plaintiff for the delivery to him of 2,265 shares of the stock and for $14,898.24 as damages for retention of the stock, or in case delivery of the stock cannot be had, then for $49,897.95, the value of the property in addition to $14,898.24 damages for retention. On January 28, 1955, the court heard and considered a motion of the respective defendants for a reopening of the judgment. Filed in connection with that motion were affidavits of the defendants and their counsel. Proposed answers were submitted. Counteraffidavits were presented in opposition. On June 20, 1955, the court by order denied the motion to reopen the judgment. This appeal is from the judgment and from the order denying the motion to reopen the judgment.
Numerous are the reasons assigned by the defendants for setting aside the judgment and for the granting of a trial upon the issues of fact and law in the cause. The plaintiff vigorously resists the defendants' attempt to reopen and vacate the judgment upon any of such bases. In the main the defendants' contentions are as follows: The complaint does not state a cause of action upon which a default judgment can be placed; there was in full force and effect at the time of the entry of the judgment an order of a. court commissioner granting defendants time to answer; the defendants appeared in this action within the twenty days required by the summons and again after receiving notice of application for default judgment which should have entitled them to present their defense; the court failed to grant defendants "short leave to amend or plead" as required by sec. 270.14, Stats.; there was pending and undetermined at the time of the entry of judgment a motion requiring plaintiff to make his complaint more definite and certain, and no default judgment could properly be entered while this motion was pending; the complaint was not properly verified; the order for judgment is not supported by evidence; there was no default in failing to file an answer for the reason that time had been granted by the plaintiff for answer beyond the date at which plaintiff initiated proceedings to obtain judgment by default; that any default that there may have been, was waived; that negligence, if any such existed, in failing to file an answer was due to conduct on the part of the defendants' attorneys and was excusable; the judgment is invalid for the reason that it is in excess of the amount demanded in the complaint and directs delivery of shares of stock admittedly not in existence at the time of the alleged conversion; the court's decision is based upon conjecture and not facts; the court erred in ruling that the defendants have no meritorious defense; the denial of leave to answer or otherwise plead constituted error and an abuse of discretion.
Application for a default judgment according to the demand of a complaint may be addressed to the court, and such judgment may be entered. Sec. 270.62(2), Stats. The relief granted to the plaintiff, if there be no answer, cannot exceed that which he shall have demanded in his complaint. Sec. 270.57. Good v. Schiltz (1928), 195 Wis. 481, 218 N.W. 727. A default judgment may be rendered for the amount claimed in the complaint, but not for a greater amount. 49 C. J. S., Judgments, p. 379, sec. 214 c.
In the case at bar the plaintiff in his complaint prayed for the recovery of the possession of the stock or for the sum of $30,349, the value thereof. The court granted judgment in the alternative for the delivery of the stock and for $14,898.24, damages for retention, or in case delivery cannot be had, then for $49,897.95, the value of the property, in addition to $14,898.24, damages for retention. The amount ordered to be paid under the terms of the judgment is considerably in excess of the money damages demanded in the complaint. Upon such basis alone the judgment cannot be permitted to stand.
Previous to the opening of the fall term, the court took under advisement both the application for default judgment and the motion to make the amended complaint more definite and certain. Although no satisfactory reason appears of record regarding the counsels' action in extending the time to answer, nevertheless, in view of the agreement between the counsel that the defendants were privileged to interpose answer within such time that the case could be heard at the fall term and which was beyond the date at which the plaintiff initiated proceedings to obtain judgment by default, that arrangement was bound to be respected. Had the court promptly determined the motion to make the amended complaint more definite and certain, it is clear, that whether such motion had been granted or denied, with short-term leave granted to plead as provided in sec. 270.14, Stats., sufficient time would have existed to have enabled the defendants to plead to the amended complaint, issue to be joined, and the case ready for trial at the fall term. The delay occasioned subsequent to the time when the court took the matters under advisement is not to be charged to counsel or to the parties. Under the circumstances we are constrained to hold that there was prejudicial error on the part of the court in not specifically determining the defendants' motion to make the amended complaint more definite and certain, and in not granting to the defendants short leave to plead.
In view of these conclusions we find no necessity for determining the other points raised by the defendants in their challenge of the validity of the judgment and the order.
By the Court. — Cause remanded with directions to set aside the judgment, render a determination with respect to the motion to make more definite and certain, afford opportunity of short leave to plead, and for further proceedings according to law. No costs are awarded to either party.