Opinion
May 5, 1953 —
June 2, 1953.
APPEAL from a judgment of the circuit court for Dodge county: W. C. O'CONNELL, Circuit Judge. Affirmed.
For the appellant there was a brief and oral argument by Louis L. Croy of Manitowoc.
For the respondents there was a brief by George A. Hartman, Robert G. Hartman, and Leo C. Hartman, all of Juneau, and oral argument by Robert G. Hartman.
Action by plaintiffs Arnold Pautsch and Herman Pautsch against defendant Clark Oil Company to quiet title to their 2/11th interest in certain real estate which they had conveyed as collateral by an instrument in the nature of a mortgage to secure a note executed by them to the defendant on May 25, 1937. The instrument was recorded in volume 180, Mortgages, page 636, in the office of the register of deeds of Dodge county. The trial court held that judgment of dismissal under sec. 269.25, Stats., in a previous action between the parties was res adjudicata in this action, and from a judgment in favor of the plaintiffs, defendant appeals.
The note given by plaintiffs to defendant, executed May 25, 1937, was payable May 25, 1938. Action was commenced by Clark Oil Company against the Pautsch brothers November 2, 1937, by a complaint which stated in part:
"VII. And the plaintiff further alleges that said note so given contains in part the following clause:
"`And the said Clark Oil Company, a corporation, or its assigns is hereby fully authorized and empowered to declare this note due at any time it may deem itself insecure, even before the maturity of this note, and proceed to collect this note, if it so elect, and take possession of the real or personal property of the undersigned.'
"That said plaintiff has good reason to believe and does believe and therefore upon such information and belief herein alleges that it does hereby deem itself insecure and therefore declares the note and mortgage due at this time and before maturity, by reason of the fact that both Arnold Pautsch and Herman Pautsch are insolvent."
In their answer to this paragraph of the complaint the Pautsch brothers alleged:
"Answering paragraph Seven, have no information sufficient to form a belief as to the truth of the allegations thereof and therefor deny same and put plaintiff to its proof thereof and specifically deny that these answering defendants are insolvent."
Defendants there further denied the validity of the instrument and filed a counterclaim. Clark Oil Company filed a reply to the counterclaim on December 8, 1937. From that date the case remained on file in the circuit court until February 7, 1951, when the Pautsch brothers moved for dismissal of the action under sec. 269.25, Stats., which provides:
"The court may without notice dismiss any action or proceeding which is not brought to trial within five years after its commencement."
The present action was subsequently commenced to quiet title to the land affected by the note and mortgage above described.
Appellant contends that because different matters would have had to be proved in the previous action than are necessary to be proved in this one, the causes of action are not identical and thus the issue in the present action is not res adjudicata.
In the prior action the Clark Oil Company elected to exercise its option to accelerate the maturity of the note and sued for foreclosure of the mortgage and a deficiency judgment. The only cause of action it had under the note and mortgage was the debt obligation when it became due. That is the identical cause of action which appellant seeks to set up as an affirmative defense in this case. The fact that different matters of proof would have been required for Clark Oil Company to maintain its original suit than would be required now to show that the obligation is due and payable, does not make the cause of action in the prior case a different cause of action than it attempts to assert here.
The cases cited by appellant are all cases where actions were dismissed because prematurely brought. They are not applicable here because the Clark Oil Company in its previous action had declared the note due under its authority to do so by reason of the acceleration clause. None of the cases cited were dismissed under sec. 269.25, Stats., granting the court discretion to dismiss actions for want of prosecution any time after five years from the date of commencement.
It must be held that a judgment of dismissal under sec. 269.25, Stats., is res adjudicata as to all matters necessary to support a judgment of dismissal on the merits. We must assume that the Clark Oil Company's cause of action was ripe in 1937 since the complaint alleged, on the basis of the acceleration clause, that the note was due and payable. Sec. 269.25 is in the nature of a statute of limitations. In Geo. Walter Brewing Co. v. Henseleit (1911), 146 Wis. 666, 669, 670, 132 N.W. 631, this court said:
"It is undoubtedly the law of this state that a seasonable voluntary dismissal by plaintiff of his cause of action, or a dismissal pursuant to a stipulation, is no bar to the bringing of a subsequent action for the same cause and between the same parties. Bishop v. McGillis, 82 Wis. 120, 51 N.W. 1075. But it does not follow from such a rule that a dismissal pursuant to sec. 2811 a [now sec. 269.25] has the same effect. Such a dismissal is in invitum and the result of at least constructive laches on the part of the plaintiff. Statutes of limitation are of ancient origin. It was early ascertained that injustice and not justice was often meted out in the prosecution of stale claims, and later it was discovered that, though a suit might be seasonably instituted, yet, if it was not seasonably brought to trial, like injustice might result. Hence the enactment in 1897 of sec. 2811 a. Speaking of its purpose this court has said: `It indicates the legislative policy that actions should not be permitted to slumber indefinitely, but that a reasonable time should be allowed within which to prosecute them, and provides a limitation.' Fleming v. Ellison, 124 Wis. 36, 41, 102 N.W. 398. . . . Before it was passed a plaintiff could suffer a nonsuit, or dismiss at any time and begin over again. If he can do so after the court has dismissed under the statute, then nothing has been accomplished by its enactment." See also Condon W. M. Co. v. Racine E. M. Co. (1924), 183 Wis. 435, 198 N.W. 268.
The order of dismissal under sec. 269.25, Stats., is discretionary and will not be granted where good cause is shown for continuing the action. That is not the situation here. Appellant makes no claim that the action should be reinstated. It attempts to set up as a defense in this case the same cause of action as was dismissed in the prior case. We hold that the dismissal of the prior action under the statute was a dismissal on the merits and that it is res adjudicata as to appellant's defense in this action.
See Wis. Anno. (1950), 1122, to sec. 269.25, Stats.
By the Court. — Judgment affirmed.