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Merchandising Corp. v. Marine National Exchange Bank

Citations: 12 Wis. 2d 79; 106 N.W.2d 317; 1960 Wisc. LEXIS 503

Court: Wisconsin Supreme Court; November 29, 1960; Wisconsin; State Supreme Court

Narrative Opinion Summary

In this case, the plaintiff, who acquired property through a warranty deed from John, filed a lawsuit against the executor of Mrs. John’s estate, alleging breach of covenants due to existing easements. These easements had been affirmed in a prior judgment involving Red Star, Patek, and Gash against Merchandising Corporation. The plaintiff, formerly a tenant on the property, claimed these easements violated the warranty deed covenants. The defendant argued that the plaintiff was estopped from claiming breach as they were aware of the easements prior to the purchase. The trial court had sustained the plaintiff's demurrer and granted a summary judgment, excluding damages. However, the appellate court dismissed the appeal due to the absence of a final judgment and found that the defendant’s answer provided a valid defense, referencing a precedent that an openly apparent easement does not constitute a defect in title. The court reversed the trial court's decision, emphasizing that the pleadings should be construed liberally to achieve substantial justice, and remanded for further proceedings, with each party bearing its own costs. Justice Hallows did not participate in the decision.

Legal Issues Addressed

Construction of Pleadings under Statutes

Application: The court applied Sec. 263.27, Stats., which mandates liberal construction of pleadings to promote substantial justice.

Reasoning: According to Sec. 263.27, Stats., pleadings should be liberally construed to ensure substantial justice.

Covenants in Warranty Deeds

Application: The court evaluated whether the alleged easements violated the covenants against encumbrances and ensured quiet possession within the warranty deed executed by John.

Reasoning: The complaint asserts that the easements violate the covenants of Mrs. John's warranty deed.

Estoppel and Knowledge of Encumbrances

Application: The defendant argued that the plaintiff, aware of the easements due to prior tenancy, was estopped from claiming breach of covenants.

Reasoning: The defendant denies knowledge of the alleged facts but claims the plaintiff, having been a tenant for two years prior to the deed, was aware of any claims regarding the premises' use by Red Star Yeast and others, thus being estopped and guilty of laches.

Non-Appealable Orders

Application: The court dismissed the appeal for lack of a final judgment, emphasizing that the orders were not appealable.

Reasoning: As no judgment had been entered in this action, the appeal was deemed non-appealable, leading to its dismissal.

Open and Notorious Use as a Defense

Application: The court found that the defendant's answer, citing open and notorious use known to the plaintiff, constituted a valid defense against breach of covenant claims.

Reasoning: The court determines that the defendant's answer presents a valid defense, thus reversing the order sustaining the demurrer and dismissing the appeal from the summary judgment.

Prescriptive Easements

Application: The court considered the long-standing use of the premises by Red Star, Patek, and Gash as establishing prescriptive easements, which were recognized in prior judgments.

Reasoning: The plaintiff's complaint detailed the long-standing use of the premises by Red Star, Patek, and Gash, establishing their claimed prescriptive easements.