Opinion
January 8, 1941 —
February 4, 1941.
APPEAL from an order of the circuit court for Milwaukee county: DANIEL W. SULLIVAN, Circuit Judge. Affirmed.
For the appellants there were briefs by John L Devos, attorney for Francis E. McGovern, and Thomas E. Leahy, attorney for H. E. Struck, both of Milwaukee, and oral argument by Mr. Devos.
For the respondents the cause was submitted on the brief of Norman L. Miswald of Milwaukee.
This action was begun on July 27, 1938, by Mandy Unmack and twenty-three other plaintiffs against Francis E. McGovern, Henry Ernst, St., George Schuh, George Sullivan, Joseph Lemay, H. E. Struck, Jake Shorter, Eric E. Buntrock, and Hartley B. Hutchison, defendants, to recover certain sums of money alleged by the plaintiffs to have been deposited with the Union Co-operative Shoe Association, a Wisconsin corporation, to be held in escrow until the full sum of $15,000 should have been paid in; that the corporate officers in violation of the understanding and agreement caused said funds to be disbursed for corporate purposes. Plaintiffs seek to recover the amounts deposited by them from the defendants, among whom are the defendants, Francis E. McGovern and H. E. Struck.
The defendants McGovern and Struck answered denying the allegations of the complaint, setting out in great detail the facts connected with the transactions set out in the plaintiffs' complaint. The defendants McGovern and Struck upon supplementary affidavits moved the court for summary judgment. The court denied the motion for summary judgment, being of the view that the allegations of the amended complaint, which were repeated in plaintiffs' affidavits in opposition to motion for judgment, considered in connection with the allegations of the denial of moving defendants, presented substantial issues of fact which required a trial of the action.
The motion for summary judgment in this case was made pursuant to sec. 270.635, Stats., which is as follows:
"Summary judgments. (1) Summary judgment may be entered as provided in this section in an action (a) to recover a debt or demand arising on a contract, express or implied (other than for breach of promise to marry); or . . .
(2) The judgment may be entered in favor of either party, on motion. . . ."
While seven classes of action are enumerated in which the motion may be made, sub. (1) (a) is the only one which could possibly have any application to the facts set out in this complaint. The defendants in their brief, in stating the nature of the action, say:
"Plaintiffs herein, as creditors of Union Co-operative Shoe Association, and as beneficiaries under a chattel mortgage covering the assets of the corporation, bring this action against the officers, directors and the general manager for an accounting and for a return of loans made by them to this association. Their claim is that at the time the money was so loaned the defendants represented that the funds contributed would be held by a trustee until the sum of $15,000 had been subscribed and that in the event the full amount was not received, the money was to be returned to the various contributors."
Other allegations of the complaint show that the moneys paid in by the plaintiffs were disbursed for corporate purposes. The plaintiffs' allegations with respect to the nature of the action are:
"The action was commenced against the officers, directors, general manager, and trustee under the $15,000 loan program in their personal and individual capacity for fraud, deceit, mismanagement, and false representations made by officers and agents of the Union Co-operative Shoe Association. . . .
"The action was not commenced against the Union Cooperative Shoe Association by reason of its insolvency and adjudication in bankruptcy."
Whether we adopt plaintiffs' or defendants' statement of the nature of the cause of action, it is clear that this is not one of the classes of actions in which a motion for summary judgment lies under the statute because it is not one upon a contract, express or implied. An implied contract does not arise under the facts of this case because the defendants who are being sued did not receive the money or use it for their own purposes. Inasmuch as no action is brought against the co-operative, no cause of action against it can be implied because of the fact that the money was used for corporate purposes.
It is doubtful whether the complaint states a cause of action against the appealing defendants. However, we cannot consider that question upon this appeal. While a motion for summary judgment searches the record ( Sullivan v. State (1933), 213 Wis. 185, 251 N.W. 251, 91 A.L.R. 877) this case is not within the statute authorizing a motion for summary judgment. The statute relating to summary judgment having no application to this case, the trial court should have dismissed the motion, which would have the effect of a denial but on a different ground.
By the Court. — Order affirmed.
FRITZ, J., took no part.