Donohue v. Pioche Mines Co. , 51 Nev. 403 ( 1929 )

Since an attachment was issued against the chose in action sued on by the plaintiff at the time this action was started, plaintiff had no cause of action that could be based thereon. The liability of the defendant, if any, was to the plaintiff in the action in which the attachment was issued, and to the attaching officer. Upon this point sec. 5154 of the code is very definite.

Under the laws of Nevada the levy of an attachment gives to the sheriff a special interest in and to the property levied on. He has the sole right to reduce a chose in action to collection. The right is of such a nature that if a third party interfere therewith the sheriff may maintain an action to protect his interest therein. This rule is definitely set forth in the case of Foulks v. Pegg, 6 Nev. 136, at 137-8.

Therefore, it is clear that at the time of bringing this suit all right and liability in and to the cause of action alleged in the complaint herein resided in the attaching officer and not in the plaintiff in this suit. The cause of action set forth in the complaint, therefore, was void, and the judgment in favor of the plaintiff therein should be reversed.

The court below erred in compelling the defendant to accept forty shares of its stock in payment of a promissory note which by its terms was payable in cash. The power of the court to dispose of defendant's counterclaim is set forth in sec. 5268 of the civil practice act. The affirmative relief prayed for in defendant's counterclaim was the payment of the aforesaid note. It is respectfully submitted that the judgment herein should be modified so as to provide that the plaintiff pay the note which the court has already decreed he was legally bound to pay. This point of law is sustained by that long line of cases analogous hereto, wherein the elementary principle of law is set forth that a court of law cannot make a new contract for the parties. The right to grant relief to the plaintiff in an action is specifically set forth in sec. 5241 of the civil practice act. The defendant in its counterclaim did not ask for and should not be compelled to accept the shares of stock awarded him by the court, defendant's cause of action being based upon a promissory note for the payment of money, and not for the payment of stock. This restriction on the court's power to award judgment that is consistent with the nature of the action is set forth in the case of Marshall v. Golden Fleece G.S. M., 16 Nev. 156-173. In line with the ruling in that case, therefore, it would seem that the court had no authority to determine upon a new fact not embraced within the pleadings and not a part of, nor consistent with, the cause of action set forth either by the plaintiff or defendant. Defendant must be laboring under a delusion that he is arguing against a demurrer in connection with which all the allegations of his answer must be taken as true. The fact remains, however, that the contentions now made were merely allegations in his answer which he was required to prove by competent evidence upon the trial of the case, if he wished to prevail thereunder. That there was a failure of proof on his part is shown by the judgment. In Kelly v. Kelly, 18 Nev. 49, it is held: "When matter is necessary to be proven in order to support the judgment, it will be presumed to have been proven in the absence of an affirmative showing to the contrary. This principle is always applied when the appeal is taken from the judgment roll alone." The converse would of course be likewise true. And in Jones v. Adams, 19 Nev. 8, it is held: "When the evidence in the case is not presented to the appellate court for review, every material fact not found must be presumed in favor of the judgment." This contention of defendant, therefore, even if properly before this court, could have no merit whatever.

Point two is answered by defendant in citation of par. 5241 (sec. 299) of the civil practice act. After an examination of the pleadings, including the reply and the judgment, it needs no further comment. The judgment, it will be noted, states definitely that the present value of the stock was fixed by "the testimony of defendant."

Firmly convinced that the record in this case conclusively shows that this appeal is prosecuted solely to delay and embarrass plaintiff, it is earnestly suggested that your honorable court add to the costs such damages as may be just.

OPINION The complaint alleges:

"That on June 5, 1923, at Pioche, Nevada, the Defendant made and delivered to the Plaintiff its promissory note of which the following is a copy:

"`Pioche, Nevada, June 5th, 1923.

"`Twelve months after date, for value received, the Pioche Mines Company promises to deliver to Ed. P. Donohue, Nine Hundred (900) shares of the capital stock of the Pioche Mines Company, par value $5.00 per share, or at the option of the said Pioche Mines Company to pay to said Ed. P. Donohue, the sum of Twenty seven hundred ($2700) and 00/100 Dollars in lawful money of the United States, payable at the Bank of Pioche, Pioche, Nevada.

"`Pioche Mines Company, "`By [Signed] John Janney. "`John Janney, President.'

"That said note became due and payable June 5, 1924, but the Defendant has not paid said note nor any part thereof."

It demands judgment for 900 shares of the capital stock of defendant company, or in lieu thereof judgment in the sum of $2,700, with interest and costs.

To the complaint an answer and counterclaim was filed. The answer admits the execution of the document pleaded in the complaint, and alleges an agreement in writing between the parties extending the time for performance to January 1, 1925. The answer further avers that a writ of attachment was sued out by a partnership known as Pierce, Critchlow Marr against the plaintiff in this action to recover the sum of $5,289.24, wherein this defendant was garnished, and that the same was still in full force and effect.

For counterclaim the defendant alleges that the plaintiff, for value received, made, executed, and delivered to the defendant his certain promissory note in the sum of $200 payable on January 1, 1925, without interest, which had fallen due and remained wholly unpaid.

The complaint in the action was filed December 15, 1926, and summons was served on the same day. The case was tried to the court on February 27, 1928.

There is no bill of exceptions in the record containing the testimony; hence the case is before us on the judgment roll alone.

The court found that the value of the stock of the defendant company was $5 per share; that the documents alleged in the complaint and counterclaim were executed as averred; and that the terms of neither had been complied with. It appears from the judgment roll that the attachment pleaded in the answer was dismissed prior to the trial of this case. The court also found that the defendant was entitled to recover judgment on its counterclaim in the sum of $200.

The court adjudged that plaintiff was entitled to recover from the defendant 900 shares of its stock, that the sum of $200 be set off against the judgment in favor of the plaintiff, and that the defendant deduct from the 900 shares of stock awarded to plaintiff 40 shares, and deliver to plaintiff 860 shares; and that, in the event of refusal, failure, or inability of defendant to deliver said stock, the plaintiff in lieu thereof do have and recover of the defendant the sum of $4,300, with interest at 7 per cent per annum, and costs.

1. It is first asserted that in view of the attachment mentioned the plaintiff had no right of action at the commencement of the suit. In support of this contention our attention is directed to the case of Foulks v. Pegg, 6 Nev. 136. There is nothing in the case mentioned to justify the contention. The facts of that case are dissimilar from those in this. There the constable took physical possession of lumber under an attachment, which the court correctly said gave him a special property interest therein. In the attachment against plaintiff there was no change of possession. But if there had been, the result would be the same, since the attachment proceeding would have only created a lien; there would have been no change of title unless followed by judgment and sale. The dismissal of the attachment obviated such a possibility.

2. It is next asserted that the court erred in adjudging that the defendant deliver to plaintiff 900 shares of the stock, less 40 shares in cancellation of the sum of $200 due from plaintiff to defendant.

In this connection counsel for defendant directs our attention to section 5268, Rev. Laws.

In pursuance of this section, counsel insists that as to the counterclaim the court had no authority to render anything but a money judgment in favor of the defendant for $200. We cannot agree with the contention. Concerning a counterclaim it is said in 34 Cyc. 629: "A counterclaim is a claim presented by a defendant in opposition to or deduction from the claim of plaintiff. A species of set-off or recoupment introduced by the codes of civil procedure in several of the states, of a broad and liberal character, and embraces, as a general rule, both recoupment and set-off, although broader and more comprehensive than either, and secures to defendant the full relief which a separate action at law, or a bill in chancery, or a cross bill, would have secured him on the same state of facts. * * *"

We think it the purpose of the code provision authorizing a counterclaim to confer upon the courts in a proper case the broadest latitude, with a view of adjusting all differences and avoiding a multiplicity of suits. Such being the spirit of the law, we do not see how the court could have rendered any judgment in the case, under the findings, which are not complained of, except to apply the claim of the defendant to the reduction of plaintiff's demand.

3. We think, however, the judgment is excessive, as contended. The document sued upon fixes the amount of plaintiff's money demand at $2,700.

Furthermore, plaintiff sued upon that theory. The complaint does not allege the value of the stock. Having elected to sue upon that theory, and not having amended his complaint to present any other theory, and not now urging any reason in support of the judgment in the amount given, other than that the court found the value of the stock to be $5 per share, we would not be justified in sustaining the judgment in the amount for which it was rendered. As quoted approvingly in State v. Board of County Commissioners of Lander County, 22 Nev. 71, 79, 35 P. 300, 302: "It may accordingly be laid down as a broad proposition that one who has taken a particular position in the course of a litigation must, while that position remains unretracted, act consistently with it."

It is ordered that the trial court modify its judgment in accordance with the views herein expressed, and, as so modified, that it stand affirmed.