Opinion
September 13, 1949. —
October 11, 1949.
APPEAL from an order of the circuit court for Milwaukee county: August E. BRAUN, Circuit Judge. Affirmed.
The cause was submitted for the appellants Louis Rosenberg and Rose Manor Realty Company on the brief of Wolfe, O'Leary Kenney and Z. F. O'Leary, and for the appellant Lavo Company on the brief of Bender, Trump McIntyre, all of Milwaukee.
For the respondents there was a brief by Shaw, Muskat Paulsen, attorneys, and John F. Zimmermann of counsel, all of Milwaukee, and oral argument by Mr. Zimmermann.
This action was commenced on the 9th day of October, 1946, by Joseph E. Uihlein, Jr., and others, plaintiffs, against I.J. Rosenberg, Louis Rosenberg, Lavo Company of America, and Rose Manor Realty Company, defendants, invoking the powers of a court of equity to reach property of the defendant I. J. Rosenberg alleged to have been transferred to the other defendants fraudulently and without consideration to defeat the rights of plaintiffs and other creditors of said I.J. Rosenberg. The defendants demurred to the plaintiffs' amended complaint as amended. The defendants appeal from an order entered February 17, 1949, overruling the demurrers.
The amended complaint, as amended, contains the following material allegations: The entry of a judgment in the circuit court for Milwaukee county in favor of Big Bay Realty Company against the defendant I.J. Rosenberg on July 23, 1935; the assignment of said judgment to plaintiffs; that the plaintiffs are the owners of said judgment; the issuance of an execution on said judgment on September 10, 1945, which execution was returned unsatisfied except for a partial payment through the proceeds of an execution sale; a conspiracy between the defendants I.J. Rosenberg and Louis Rosenberg to place the assets of I.J. Rosenberg beyond the reach of his creditors; that the defendants Lavo Company of America and Rose Manor Realty Company are Wisconsin corporations under the complete domination and control of I.J. Rosenberg and Louis Rosenberg; that these corporations were used by the Rosenbergs for the holding of title to property belonging to I.J. Rosenberg as a means of defrauding his creditors; that these corporation defendants were at all times aware of the conspiracy to defraud said creditors, and entered into and became parties to said conspiracy; that in furtherance of said conspiracy five fraudulent transfers were made: (1) On February 27, 1933, I.J. Rosenberg made a fictitious assignment to the defendant Lavo Company of his right to receive rentals from certain real estate described in the complaint; (2) on June 25, 1934, Louis Rosenberg, as agent for I.J. Rosenberg, was paid $27,500 by Milwaukee Electric Railway Light Company for the cancellation of a lease on real estate described in the complaint, and that Louis Rosenberg still holds said funds invested in his own name for I.J. Rosenberg; (3) in December, 1939, I.J. Rosenberg purchased certain real estate described in the complaint from the banking commission of Wisconsin through the Lavo Company and title to said property was conveyed to the Lavo Company; (4) that at the time of the purchase of said property from the banking commission of Wisconsin all of the capital stock of the defendant Lavo Company of America was owned by the defendant I.J. Rosenberg, but as a means of concealing his ownership of said capital stock the certificates representing the shares of said capital stock were in form transferred by I.J. Rosenberg to the defendant Louis Rosenberg without payment of any consideration, and new certificates were in form issued in the name of said Louis Rosenberg; (5) that certain real estate described in the complaint was owned by the defendant I.J. Rosenberg from the 23d day of July, 1935, until the 8th day of March, 1945, although said defendant pretended that said property was owned by his wife and that an unrecorded deed to said property from himself to his wife had been lost; that on March 8, 1945, a tax deed executed by the city treasurer of the city of Milwaukee purported to convey said real estate to Rose Manor Realty Company, and on the 26th day of July, 1945, a tax deed executed by the county clerk of Milwaukee county, Wisconsin, purported to convey said property to Rose Manor Realty Company; that on the 10th day of September, 1945, all the right, title, and interest that defendant I.J. Rosenberg had in and to said property from the 23d day of July, 1935, was purchased upon execution sale by the plaintiffs herein in the name of an agent.
The defendant Lavo Company demurred to the amended complaint as amended on two grounds, to wit: (1) Misjoinder of causes of action; (2) failure to state facts sufficient to constitute a cause of action. The defendants Louis Rosenberg and Rose Manor Realty Company demurred separately upon the same grounds.
The defendants contend that the five alleged fraudulent transfers described above are five separate and distinct causes of action, each of which affects some of the defendants but that none of them affects all of the defendants, and that this results in a misjoinder of causes of action.
The correct rule is stated in Simon v. Weaver, 143 Wis. 330, 341, 127 N.W. 950:
"It is, however, a misconception of the complaint before us to say that it states more than one cause of action. True, a number of wrongful acts are set out, and different forms of relief are demanded, but that is only alleging the various ways in which the fraudulent scheme was consummated, and demanding appropriate relief for each separate wrong flowing therefrom. It is not alleging separate causes of action. As was said by this court in Zinc C. Co. v. First Nat. Bank, 103 Wis. 125, 139, 79 N.W. 229:
"`There is but one subject of action, — the conspiracy to defraud and its consummation to the damage of plaintiff. All the allegations of fact are parts of the presentation of that one subject. The test of whether there is more than one cause of action stated or attempted to be stated in a complaint is not whether there are different kinds of relief or objects sought, but whether there is more than one primary right sought to be enforced or one subject of controversy presented for adjudication.'
"To the same effect are Gager v. Marsden, 101 Wis. 598, 77 N.W. 922; Adkins v. Loucks, 107 Wis. 587, 83 N.W. 934; Herman v. Felthousen, 114 Wis. 423, 90 N.W. 432. In these cases the question has been so fully discussed, and the distinction between alleging separate causes of action and alleging one subject of wrong out of which separate wrongs may flow calling for different relief is so clearly pointed out, that it is deemed neither necessary nor advisable to further extend the discussion of the subject." See also 30 C.J.S., Equity, p. 591, sec. 153; 69 A.L.R. 229; Ellis v. Northern Pacific R. Co. 77 Wis. 114, 45 N.W. 811; Warne v. Petzke, 223 Wis. 435, 270 N.W. 922.
As to the second ground, the allegations of fact in the amended complaint as amended must be taken as true. As the case has not been tried we make no comments upon the alleged facts or the law that might tend to influence in any way the outcome of the trial. We will only say that a careful review has been made of the allegations. If the facts alleged can be proved at the trial the plaintiffs will be entitled to judicial relief.
By the Court. — Order affirmed.