Illinois Steel Co. v. Warras

Dodge, J.

The principal error assigned consists in relieving- the defendant from the stipulation of March 15, 1907. That conduct is sought to be supported on the ground, amongst others, that such stipulation was beyond the power of the defendant’s attorney. The powers of attorneys at law in charge of litigation are very broad, and while it may be that the general retainer is not sufficient to authorize an absolute surrender of substantive property rights which the attorney is employed to establish and enforce (Fosha v. O’Donnell, 120 Wis. 336 , 97 N. W. 924 ), still it is and must be sufficient to enable the attorney in his honest judgment to control all matters of procedure in the action brought for such enforcement. Weeks, Attorneys (2d ed.) § 221; Read v. French, 28 N. T. 285, 293. In this case the plaintiff had a clear and absolute right by statute (see. 3074, R. S. 1878) to make proof of title and right to possession acquired subsequent to the commencement of the action, upon payment of the costs accrued up to the time of claiming such right, and, probably, upon some form of procedure sufficient to fairly notify defendant. Whether such procedure should be by notice, by application to the court, or by supplemental pleading is not now material *123 to declare. The effect of the stipulation as against defendant was merely to waive such procedure and such payment of costs in consideration, however, of plaintiff’s waiver in the-same stipulation of the right to insist on costs, in the discretion of the court., to he paid by defendant upon the granted privilege of amending his answer after his strict right so to do-had expired. The defendant’s costs, accrued up to the time of the stipulation, were obviously trifling. Substantially nothing had been done by the defense in the suit except to retain Mr. Oble and to serve an answer. We cannot doubt that such mere matter of procedure and of the balancing of claims to costs, especially where, as here, they must have been so-nearly equal in amount, is within the power of the attorney at law employed to conduct the litigation, nor that his acts in> such regard are binding upon his client independently of any express consent or even knowledge or understanding by the latter, and may safely be relied on by the antagonist and the-court. Wa lker v. Rogan, 1 Wis. 597 ; Clason v. Shepherd, 10 Wis. 356 ; Beach v. Beckwith, 13 Wis. 21 ; Blomberg v. Stewart, 67 Wis. 455 , 30 N. W. 617 ; Bingham v. Winona Co. 6 Minn. 136 ; Emmons v. N. Y. & E. R. Co. 17 How. Pr. 490 ; In re Maxwell, 66 Hun, 151 , 21 N. Y. Supp. 209 ; Leahy v. Stone, 115 Ill. App. 138 .

A contention is m.ade, somewhat ambiguously, that the stipulation never came into effect or that it lacks mutuality, because not signed by John H. Paul, the attorney who signed the summons and for whom no substitution had been made. There are two answers to this contention: First, that it is. fully established that the firmrnf Van Dyke, Van Dyke & Carter, with consent of Mr. Paul, had full authority from the-plaintiff as its attorneys to conduct the litigation, and that defendant’s attorney knew it; also that said firm had already taken some steps, and executed certain papers, in the procedure of the case as attorneys for plaintiff. Walker v. Bogan, supra; King v. Bitchie, 18 Wis. 554 . Further, the stipula *124 tion was treated as effective by botb parties and was acted npon by tbe defendant promptly to bis own advantage, for be •exercised tbe right therein granted to file bis amended answer without any application to the court and without payment of .any costs, expressly declaring in said answer that it was so ¡served and filed by virtue of the stipulation. Such right was recognized by tbe plaintiff as having been accorded by tbe .stipulation. In such situation there can, of course, be no •doubt either of tbe mutuality or completeness of tbe agreement.

Tbe court, however, set the stipulation aside upon tbe expressly stated ground that on tbe defendant’s part it bad been improvidently made. We confess our inability to discover any improvidence. Beyond doubt, it ujas fully understood by defendant’s attorney who was intrusted with discretion to malee it. As already stated, it granted no new right to the plaintiff except absolution from a small amount of costs, and ■did that in acquisition to defendant of certainty of right to .amend tbe answer without difficulty or formality, which at the time was at most a. mere conditional privilege resting in the discretion of the court, upon tbe granting of which costs might properly have been imposed upon him. When to that is added the fact that defendant exercised the right so granted to him by the stipulation after due period for reflection and has rested upon that right for some ten years, we feel no hesitation in declaring the finding of improvidence in antagonism to all the disclosed facts.

While we of course recognize broad discretion in trial ■courts to relieve parties from stipulations and admissions when improvident and induced by fraud, misunderstanding, ■or mistake, or rendered ■ inequitable by the development of a new situation, as in Brown v. Cohn, 88 Wis. 627, 636 , 60 N. W. 826 , yet that is a judicial discretion to be exercised in promotion of justice and equity and not in subversion thereof. Stipulations differ in their character. Some are mere admissions of fact simply relieving a party from the inconvenience *125 of making proof, and the setting aside thereof may place the parties in no worse position than they were when the stipulation was made. The agreement under consideration, on the contrary; was in all essential characteristics a mutual contract by which each party granted to the other a concession of some rights as a consideration for those secured. Such a contract is entitled to all the sanctity of any other, and when on the faith of it the parties have so acted in execution thereof that the status quo cannot he re-established as to one of them, it is only in a plain case of fraud, mistake, or oppression that the court should set it aside. Especially impregnable is such a contract when the one party thereto has received and enjoyed the fruits thereof, and the other, on the faith of it, has so-changed his situation that he will he seriously and irremediably prejudiced. Burnham v. Smith, 11 Wis. 258 ; Blomberg v. Stewart, 67 Wis. 455 , 30 N. W. 617 ; Brown v. Cohn, 88 Wis. 627, 637 , 60 N. W. 826 ; Garvin v. Crowley, 116 Wis. 496 , 93 N. W. 470 ; Schroeder v. Klipp, 120 Wis. 245 , 97 N. W. 909 ; Washburn v. Lee, 128 Wis. 312 , 107 N. W. 649 ;. Rogers v. Greenwood, 14 Minn. 333 ; Keogh v. Main, 52 N. Y. Super. Ct. 160; Slaven v. Germain, 64 Hun, 506 , 19 N. Y. Supp. 492 ; Smith v. Barnes, 9 Misc. 368 , 29 N. Y. Supp. 692 ; Thompson v. Ft. W. & R. G. R. Co. 31 Tex. Civ. App. 583 , 73 S. W. 29 . In the instant case, as stated, defendant for ten years has enjoyed the rights granted him by the stipulation, during which time the conveyances now excluded have been.of record. On the other hand, plaintiff, in reliance on the stipulation, has forborne to-exercise its right under sec. 3074, which existed at the time of the making of the stipulation, and now cannot exercise it except by complying with that statute in paying all costs now accrued, which, obviously, from the record before us, are large in amount, probably approximating the value of the property in controversy. Further, as a result of the court’s action in setting aside the stipulation and nonsuiting the plaintiff, its right, if any, in the property would become barred by statute of limitations pre^ *126 eluding a new action. Such a result is grievously inequitable, and we are constrained to declare the action of the trial court so in disregard of mutual equities as not to constitute an exercise of judicial discretion, but to be arbitrary and unreason.able and therefore erroneous.

It is urged that, even were the stipulation not set aside, the judgment of nonsuit was proper because the plaintiff, being an Illinois corporation, is not competent to acquire or own this real estate, the law of Illinois not according such a corporation power to hold real estate beyond the needs of its general business. This contention might well be answered by the consideration that defendant has not proved the law of Illinois, and we cannot take judicial notice that it differs from that of Wisconsin. But a more complete answer is that inability of a corporation, foreign or domestic, to' acquire title to any property cannot be raised by a stranger claiming the property unless, perhaps, such inability results from express statutory prohibition. Such merely ultra vires acts can be •questioned only by persons directly interested in the corporation, or by the state, whose charter and franchises are exceeded or abused. John V. Farwell Co. v. Wolf, 96 Wis. 10 , 70 N. W. 289 , 71 N. W. 109 ; Att’y Gen. ex rel. Askew v. Smith, 109 Wis. 532, 541 , 85 N. W. 512 ; Security Nat. Bank v. St. Croix P. Co. 117 Wis. 211, 217, 94 N. W. 74 ; Cowell v. Springs Co. 100 U. S. 55 ; Christian Union v. Yount, 101 U. S. 352 ; American B. Soc. v. Marshall, 15 Ohio St. 537 .

No question is raised or decided whether the excluded ■deeds, if in evidence, would prima facie establish title in plaintiff to the parcel in controversy. The rulings of the trial court are considered on the hypothetical assumption that they would do so, apparently made both by that court and by counsel here. The confusion of descriptions, and perhaps of grantors, is such that we should not undertake analysis of the surveys or the chain of title in absence of discussion.

By the Court. — Judgment reversed and cause remanded for a new trial.