May 4, 1959 —
June 2, 1959.
APPEAL from an order of the circuit court for Dane county: RICHARD W. BARDWELL, Circuit Judge. Modified and, as modified, affirmed.
For the appellant there was a brief and oral argument by Martin M. Morrissey of Madison.
For the respondents there was a brief by Spohn, Ross, Stevens, Lamb Pick of Madison, and oral argument by James F. Spohn.
Motion by the defendant Edna T. Norden to strike a cognovit judgment entered against her in behalf of the plaintiff law firm of Spohn, Ross, Stevens, Lamb Pick.
Under date of January 26, 1956, the plaintiff law firm commenced an action against the defendant in the circuit court by service of a summons and complaint. By such action the plaintiff sought to recover the sum of $1,068.60, together with interest, for legal services performed by it for the defendant. The complaint alleged that the defendant had executed her promissory note in the sum of $625 payable to the order of the plaintiff dated March 16, 1953, for part of such amount due, and a copy of the note was attached to the complaint and made a part thereof. The defendant filed and served an answer and counterclaim by which she demanded dismissal of the complaint and recovery of the sum of $5,000 damages on the counterclaim. The plaintiff demurred to part of the answer and counterclaim, which demurrer was sustained. Thereafter, an amended answer and counterclaim was served and filed by the defendant wherein the demand for damages on the counterclaim was increased to $10,000.
The $625 note contained a warrant of attorney whereby any attorney of a court of record was authorized to appear for the defendant maker and confess judgment in favor of the holder for the amount due together with reasonable attorney fees and costs. Pursuant to such warrant of attorney, one Warren D. Lucas appeared in the circuit court for Dane county and confessed judgment on such note in favor of the plaintiff and against the defendant in the sum of $859.87 principal, interest, attorney fees and costs, which cognovit judgment was duly entered and docketed by the clerk of said court on January 30, 1958.
The defendant moved the circuit court for an order striking such cognovit judgment and enjoining the plaintiff from enforcing the same. The court thereupon issued an order requiring the plaintiff to show cause on March 19, 1958, why such motion should not be granted. Pursuant thereto, the court held a hearing on such motion and thereafter, on March 21, 1958, entered an order denying the defendant's motion. The material portions of such order read as follows:
"The plaintiff having advised the court that the entry of its cognovit note into judgment was taken for security purposes only, and that it has no desire to do more than to preserve its security rights against the property of the defendant until such time as the action for fees may be brought on for trial, and
"The court being fully advised in the matter,
"Now, therefore, on motion of the plaintiff the motion to strike the judgment entered January 30, 1958, be and the same hereby is denied, and the lien status of that judgment shall continue unimpaired.
"The plaintiff who has not resisted the motion for an injunction is ordered to take no further steps to enforce its cognovit judgment by levy or otherwise, without further order of the court, pending final determination of the action commenced by it for its fees."
The defendant has appealed from such order.
Counsel for the defendant on this appeal states that the motion to strike the cognovit judgment was prepared by a Maryland attorney who was not familiar with Wisconsin practice, and concedes that the proper motion would be one to either open or vacate the judgment. The plaintiff consents that such motion may be so treated by this court on this appeal. Therefore, we will so treat it.
The plaintiff contends that, because of the recital in the order appealed from that the plaintiff had advised the court that the cognovit judgment was taken for security purposes only, such order did open up the judgment and permit the defendant to defend on the merits. However, the order does not make this clear. It should be modified by adding a clause thereto: (1) Specifically directing that the judgment is opened and that the defendant's amended answer and counterclaim in the action for fees, which was instituted by the plaintiff against the defendant, stand as defendant's pleading to the plaintiff's complaint in the cognovit-judgment roll; and (2) that the cognovit judgment be continued in effect for security purposes only until the trial and determination of such action for fees.
Counsel for the defendant also advances the argument that the cognovit judgment should be vacated and not merely opened up. We do not agree. In State ex rel. Bornemann v. Schultz (1952), 260 Wis. 395, 402, 50 N.W.2d 922, we stated:
"In most cases, where relief is sought by a party against whom a default judgment had been rendered, the interests of justice would seem to be best served by opening up the judgment and granting a trial upon the merits, thus retaining the lien of the judgment pending the outcome of such trial, rather than vacating the judgment outright; but nevertheless this is a matter in which the trial courts are free to exercise their own sound discretion."
By the Court. — Order modified as provided in this opinion and, as so modified, is affirmed. No costs shall be taxed by either party on this appeal.
MARTIN, C. J., took no part.