28 S.D. 177 | S.D. | 1911
Plaintiff, who is appellant in this court, brought this action to recover from defendant, the respondent, a balance
The principal contention of appellant is that the counterclaim is not connected in any manner with the contract sued upon, namely the notes; that the notes sued upon form the basis of the cause of action; and that the counterclaim must be connected with the contract sued on, and form a part of the transaction of the giving of the notes only. We are of the opinion that this contention is not tenable. The consideration of this question involves the construction of subdivision I, § 127, Code Civ. Pr. A like provision is found in the Codes of many other states. In the case of Story v. Story & Isham Commercial Co., 100 Cal. 30, 34 Pac. 671, the court held that the ‘'transaction” comprehended within the meaning of this section of the Code is not limited to the facts set forth in the complaint, but includes the entire series of acts ana mutual conduct of the parties in the business or proceeding between them which formed the basis of the agreement, and if
The question, based largely on the New York decisions, seems to be well stated in 34 Cyc. 687; “It is difficult to determine or to lay down a rule for determining when a cause of action set forth in the counterclaim is so connected with plaintiff’s cause as to be allowable under the section allowing a counterclaim connected with the subject of the action, for the word ‘connected’ may have a broad signification; the connection may be slight or intimate, remote or near; the best rule for determining the required connection being that the counterclaim must have such a relation to, and connection with, the subject of the action that it will be just and equitable that the controversy between the parties as to the matters alleged in the complaint and in the counterclaim should be settled in one action and by one litigation, and that the claim of one should be offset against or applied upon the claim of
The order appealed from is affirmed, and the cause remanded for further procedure.