of her earnings the claims of the interveners were to be paid in full, and also the sums contributed by them to the purchase fund; and thereafter the Eclipse was to be the absolute property of Braithwaite and Biggert. The interveners claim that they have not been paid in full, and that the judgment for freight earned by the steamer under this contract, or some part of the judgment, belongs to them, and they ask for an accounting. It is obvious that the interveners’ cause of action against Braithwaite, set forth in the complaint in intervention, is upon contract. The counterclaim interposed is for the conversion of the steamboat Eclipse by the interveners. The defendant Braithwaite seeks to recover against these wrongdoes the value of his half interest on account of such conversion.
The right to set up a counterclaim rests upon statute, except in those cases which are peculiar in their nature. In those cases, equity, to prevent injustice, will allow counterclaims which the law ignores. Our first inquiry is whether the defendant Braithwaite has a right to set up this tort as a counterclaim under the statute? This brings us to the statute itself. It provides: “The counterclaim mentioned in the last section must be one existing in favor of a defendant and against a plaintiff, between whom a several judgment might be had in the action, and arising out of one of the following causes of action: First, A cause of action arising out of the contract or transaction set forth in the complaint as the foundation of plaintiff's claim, or connected with the subject of the action. Second, In an action arising on contract, any other cause of action arising also on contract and existing at the commencement of the action.” Section 4915, Comp. Laws. Under the second subdivision, any other cause of action arising on contract would constitute a good counterclaim. It is contended that the defendant Braithwaite had a right to waive the tort involved in the conversion of his interest in the steamboat, and sue in the assumpsit. The averments of the counterclaim would not bring him within the rule that a tort may be waived, as it is
N. D. R.—24.
