Opinion
No. 283.
Argued June 1, 1970. —
Decided June 26, 1970.
APPEAL from an order of the circuit court for Milwaukee county: WILLIAM I. O'NEILL, Circuit Judge. Affirmed.
For the appellant there were briefs by Alexander N. Rubin, attorney, and Walter F. Gregorski of counsel, both of Milwaukee, and oral argument by Mr. Gregorski.
For the respondent there was a brief by Ray T. McCann, attorney, and Leonard L. Loeb, of counsel, both of Milwaukee, and oral argument by Mr. Loeb.
This action for repayment of a note was commenced by Norma E. Prestin against her son-in-law Donald W. Baumgartner. In pertinent part the plaintiff's complaint alleged:
"Sanford, Florida, Dec. 2 1957 $2000.00
"3. That heretofore and on December 2, 1957, for value received, to-wit: money loaned by the plaintiff to the defendant, said defendant made, executed and delivered a written instrument under seal promising to pay on demand the sum of two-thousand dollars ($2,000.00); photostatic copy of which instrument is hereto attached, made part hereof, and marked Exhibit A.
"4. That the defendant has failed and neglected to pay the said sum, or any part thereof, although due demand has been made therefor, and that there is now due and owing from the defendant to the plaintiff the sum of two-thousand dollars ($2,000.00), with interest thereon.
"Wherefore, plaintiff demands judgment against the defendant in the sum of two-thousand dollars ($2,000.00), with interest, costs and disbursements of this action."
In answer to these allegations the defendant, after denying knowledge or information sufficient to form a belief as to the plaintiff's residence, alleged as follows:
"3. Answering Paragraph 3, admits that at times material defendant executed a written instrument as alleged but denies that said defendant received the sum of Two Thousand and no/100 ($2,000.00) Dollars and further denies that plaintiff loaned money to the said defendant as alleged or otherwise.
"4. Answering Paragraph 4, denies that plaintiff has made due demand upon defendant as alleged; further answering Paragraph 4, denies that there is now due and owing from the defendant to the plaintiff the sum of Two Thousand and no/100 ($2,000.00) Dollars with interest thereon.
"Wherefore, defendant demands judgment dismissing the complaint of the plaintiff upon the merits, together with costs and disbursements."
Pursuant to sec. 889.22, Stats., the plaintiff then served upon the defendant a demand to admit or refuse to admit that the plaintiff's place of residence was as shown in the complaint, that the document attached to the complaint was a true and correct copy of the note which bore the signature of defendant and that defendant owed $2,000 to the plaintiff. In response to this demand the defendant submitted his refusal to admit.
Subsequent to this refusal to admit and prior to commencement of trial the plaintiff moved for judgment on the pleadings. This motion was taken under advisement and a trial was had to a jury. Following the jury's failure to agree upon a verdict, the plaintiff moved for a directed verdict. The trial court dismissed the jury and later ordered judgment on the pleadings for the plaintiff. In so doing the trial court held that the defendant's answer was insufficient to rebut the essential allegations of the plaintiff's complaint and thus failed to raise issues of fact. The trial judge also refused to accept defendant's contention that he had inferentially pleaded the affirmative defense of either gift or failure of consideration and noted that even if the plaintiff was not entitled to judgment on the pleadings, the evidence at trial was such as to entitle her to a directed verdict. The defendant now appeals from the order allowing judgment on the pleadings.
"For Value Received, I, or We jointly promise to pay to the Order of Norma E. Prestin at the _______ the sum of Two Thousand _______ Dollars ($ ______ ) in installments as follows $ ______ on the ______ day of ______ 19__ and $ ______ on the ______ day of each month thereafter until paid in full.
"Upon default in the payment of any installment, the entire unpaid balance may be immediately at the option of the holder thereof be declared due and payable.
"In the event that this note is placed in the hands of an attorney or attorneys to enforce payment thereof, I/We agree, to pay in addition to the amount due, a reasonable attorney's fees, and to be recovered in the same action, and made part of the judgment.
"In the event that I/We shall fail to make any payment herein provided for at the time when the same becomes due under the provisions hereof and said payment shall become overdue for a period in excess of 15 days, I/We promise to pay a `late charge' of five cents (5¢) for each dollar of each payment so overdue, but not to exceed $5 in respect to any one such late payment, for the purpose of defraying the expense of following up and handling the said delinquent payment. /s/ Donald W. Baumgartner "__________________________ __________________________ (SEAL)
P. O. Box or R.D. Number or Street Number
"______________________ __________________________ (SEAL)
City and State "Celery City Printing Co., -Sanford-1M-10-56"
The sole issue on this appeal is as follows: Was the defendant's answer sufficient either to negate the essential allegations of the plaintiff's complaint or to raise an affirmative defense thereto?
The plaintiff's contention here, as in the trial court, is that the defendant's answer was comprised of negative pregnants and was insufficient to place the allegations of the complaint in issue.
For discussion of negative pregnants, see generally: Spence v. Spence (1863), 17 Wis. 462 (*448); Schaetzel v. Germantown Farmers' Mut. Ins. Co. (1868), 22 Wis. 393 (*412); Argard v. Parker (1892), 81 Wis. 581, 51 N.W. 1012; Grimm v. Town of Washburn (1898), 100 Wis. 229, 75 N.W. 984; and Carpenter v. Town of Rolling (1900), 107 Wis. 559, 83 N.W. 953.
Negative pregnants occur in responsive pleadings where, as in the instant answer, the denials are stated in the very words employed in the complaint. Such denials were condemned by this court as early as Schaetzel v. Germantown Farmers' Mut. Ins. Co., supra, because they are pregnant with alternative admissions to the allegations of the complaint. An examination of the denials contained in defendant's answer reveals that, although they are not framed in the exact words of the complaint, the similarity is indeed striking. The most crucial shortcoming of the defendant's answer, however, is its admission that he executed the written instrument, which was under seal, yet failed to allege an affirmative defense to its collection.
Under sec. 891.27, Stats., a seal upon an executory instrument is presumptive evidence of sufficient consideration. See: Estate of Cortte (1939), 230 Wis. 103, 106, 283 N.W. 336; Spankus v. West (1936), 222 Wis. 238, 267 N.W. 910. It is defendant's contention on this appeal that denial of the receipt of the $2,000 and denial that a loan was made constitute the inferential allegation of gift as a defense. In support of this contention, he relies upon sec. 263.27, Stats., which states:
" Pleadings liberally construed. In the construction of a pleading for the purpose of determining its effect its allegations shall be liberally construed, with a view to substantial justice between the parties."
While it is true that pleadings are to be liberally construed, sec. 263.13, Stats., states:
"The answer of the defendant must contain:
"(1) . . .
"(2) A statement of any new matter constituting a defense, in ordinary and concise language, without repetition." (Emphasis supplied.)
Sec. 263.16, Stats., further requires that:
"The defendant may set forth, by answer, all defenses . . . he has, whether legal or equitable, or both; they must be separately stated." (Emphasis supplied.)
As a defense, the claim that money was given as a gift is closely akin to the defense of lack of consideration. When claiming lack of consideration, one would assert that he received nothing in consideration for his promise to pay a sum of money, while, when claiming receipt of a gift, one would assert that his promise to repay a sum of money was both unnecessary and ineffectual.
Contrary to the contention of the defendant, we think that the answer here under consideration cannot be interpreted to include the defense of gift or lack of consideration.
Pleadings are intended to fairly apprise the opposing party of the matters to be tried. This court in Johann v. Milwaukee Electric Tool Corp. (1955), 270 Wis. 573, 582, 72 N.W.2d 401, stated that failure of consideration was an affirmative defense and that the facts constituting failure of consideration must be pleaded. The defendant's mere denial that he had received $2,000, beside being a negative pregnant and admitting to the possibility that some other sum was received, is insufficient to raise the defense of lack of consideration. Restatement, 1 Contracts, p. 80, sec. 75 (2), states:
" Consideration may be given to the promisor or to some other person. It may be given by the promisee or by some other person." (Emphasis supplied.)
The defendant's denial of the receipt of the $2,000 thus left open the possibility that someone else received the money at his request. In such circumstances, there is no lack of consideration.
As to the pleading of gifts, it was held in Peters v. Peters Auto Sales, Inc. (1967), 37 Wis.2d 346, 350, 155 N.W.2d 85, that a party seeking to establish the existence of a gift must allege all the essential elements of a completed gift. These elements included: "(1) Intention to give, (2) delivery, (3) end of dominion by donor, (4) creation of dominion in donee. . . . . "
It is obvious from the defendant's answer that such elements have not been pleaded. Since the answer in the instant case admits the execution of a note under seal and fails to plead an affirmative defense thereto, the motion on the pleadings was properly granted.
By the Court. — Order affirmed.