text:
    Stillman B. Jamieson, Defendant in Error, v. Robert S. Iles and Robert D. Martin, Plaintiffs in Error.
    Gen. No. 25,325.
    1. Partnership, § 78

      —when partner is not entitled to compensation. One of the members of a partnership of lawyers formed to prosecute suits for the collection of forfeited taxes and divide the fees was not entitled to profit from services rendered by the defendants subsequent to the date of a certain settlement, where he rendered no'services whatever save as he helped to obtain the retainer of one of the defendants by the county board before the formation of the partnership.
    2. Contracts, § 139*—when contract has illegal object. No obligation attached to a promise of compensation for influence or help in obtaining from a public body, such as the county commissioners, a retainer as its attorney to render certain specified legal services.
    3. ■ Contracts, § 139*—what contracts are void as against public policy. All agreements for pecuniary consideration to control the business operations of the government are void as against public policy without reference to the question whether improper means are contemplated or used in their execution.

      4. Contracts, § 161

      —who may assert illegality of contract. Where the illegality of a contract appears, it is of no importance whether such illegality he set forth by plea or allegation of the defendant, as it is the duty of the court both at law and in equity on grounds of public policy to repel plaintiff and refuse its aid to sustain the contract.
    Error to the Circuit Court of Cook county; the Hon. Ebedebiok A. Smith, Judge, presiding. Heard in this' court at the October term, 1919.
    Reversed and remanded with directions.
    Opinion filed November 4, 1920.
    Peter J. Hower, for plaintiffs in error.
    J. Henry Nissen, for defendant in error.

      See Illinois Notes Digest, Vols. XI to XV, and Cumulative Quarterly, same topic and section number.

      See Illinois Notes Digest, Vols. XI to XV, and Cumulative Quarterly, same topic and section number.

   Mr. Presiding Justice Taylor

delivered the opinion of the court.

The complainant’s cause of action is set forth in an amended bill of complaint which was filed in the circuit court on December 3, 1910. The substantial allegations are that the County Board of Cook County on January 2, 1900, gave a contract to the defendant lies, whereby it authorized him to collect certain forfeited taxes and receive as his fees one-fourth of what was recovered; that the complainant and the defendants entered into a written agreement of copartnership, the sole business of which was the collection of forfeited taxes pursuant to the Hes contract of January 2, 1900; that a large number of suits for taxes were begun and that since May 1, 1904, a number of the claims covered by suits pending upon that date have been paid in and a large sum realized as fees for legal services; that according to the agreement of January 2, 1900, the complainant is entitled to one-third of such fees; but that the defendants refused to account therefor. The prayer is for an account of what has been done in the copartnership matter since May 1, 1904, and for a decree to pay what may be shown to be due.

The defendants filed certain demurrers, which were overruled, and on January 28, 1911, filed certain pleas which, also, were overruled. On November 15, 1911, the defendants, pursuant to leave, filed an additional plea, that set up abandonment of the partnership on May 1,1905, by the complainant, and a dissolution and settlement.

On November 15, 1911, there was a trial before' the chancellor of the issues which were precipitated by the amended bill of complaint, an answer and certain pleas of the defendant, and on December 12, 1911, the chancellor entered an interlocutory decree. That decree recited: (1) That the cause came on to be heard on the second amended bill of complaint, the answer, three separate pleas of the defendants, the replication of the complainant, and upon proofs and exhibits taken in open court, and that the court finds:

(2) That the pleas are not sustained and are all overruled; that the equities are with the complainant; that he is entitled to a dissolution of the partnership mentioned in the bill of complaint and an accounting as prayed for in the second amended bill of complaint.

(3) That by the written agreement of January 9, 1900, the parties entered into a partnership agreement as set forth in the amended bill; that the said agreement is still in force and effect; that up to June 7, 1905, the receipts and disbursements of the partnership had been settled between the parties by an account stated and settled, except as to certain minor matters.

(4) That the complainant is entitled to an accounting from both of said defendants for all moneys received and disbursements made by them since June 7, 1905, for legal services rendered in connection with the law business covered by said partnership agreement.

The interlocutory decree ordered that the pleas he overruled and the cause referred to Master in Chancery Rogers to take a mutual account of all dealings and transactions between the complainant and the defendants in said cause from June 7, 1905, and all moneys received and disbursements made by the defendants for legal services rendered in connection with the law business covered by said partnership agreement, etc.

Pursuant to the order of reference, the parties introduced evidence at various hearings before Master in Chancery Rogers, and in the course of the taking of testimony before him, evidence was introduced concerning the origin of the contract of January 2, 1900, with the county board, it being claimed by the solicitors for the defendants that they were entitled to offer evidence to show that the contract to pay the complainant one-third of the fees to be recovered under the contract with the county board was illegal. The master, after certain evidence on that subject was introduced, ruled that under the order of reference he had no authority to pass upon that question and, upon March 23, 1914, a motion was filed by the solicitors for the defendants which recited that they would ask the court to define more specifically the duties of the master under the order of reference and, also, that they “the defendants, be permitted to file an amended plea herein setting up the illegality of the contract sued upon or that this suit be dismissed,” etc. ■

The reason assigned for the illegality was that it appeared upon the face of the record that the contract sued upon was contrary to the public policy of the State; that “it appears upon the record that said contract is contrary to public policy because the consideration thereof so far as the complainant, Jamieson, was concerned was in whole or in part the procurement of the acceptance, by the Board of County Commissioners of Cook County, of the proposition by Robert S. lies to said County Board for the performance of personal services for the County of Cook in the State of Illinois for a certain consideration”; that the contract was for the division between the parties of fees to be earned by lies “in the performance of services of a personal nature in an official or quasi official capacity for the County of Cook”; that the contract was contrary to public policy, etc.

Although we do not find in the abstract or record any express order of the court overruling the motion, we are entitled to assume from the recitation in the certificate of April 17,1914, that the motion was heard and overruled.

Master in Chancery Rogers having died the cause was referred to Master in Chancery Mason. Evidence was taken before the latter, and on October 23, 1915, his report was filed recommending that a decree be entered in' favor of the complainant against both the .defendants in the sum of $3,913.37, and against the defendant, Martin, for the additional sum of $83.33.

On December 18, 1918, a final decree was entered which recited that the “cause coming on to be heard upon the bill of complaint as twice amended, the joint and several answers and the three separate pleas of the defendants (heretofore overruled by the court) and the replication of the complainant thereto and upon the report heretofore filed herein” of the master in chancery, the report of the master is approved, and it then decreed that the complainant recover of the defendants $3,913.37 with interest at 5 per cent from October 9, 1916, and the further sum of $83.33 with 5 per cent interest from April 11, 1914, from the -defendant Martin. It also found that the complainant was entitled to one-third of the net fees when collected in certain pending and undisposed of cases.

Inasmuch as we are of- the opinion that the determination of the question concerning the illegality of the contract is decisive of the cause, it follows that it will be unnecessary for us to set forth here an analysis of or in any way consider the matters of account. Accordingly, we shall first refer to the evidence showing the origin of the contract with the county board and that between the complainant and the defendants, and then state the law applicable thereto.

A short time prior to January 2, 1900, the defendant lies, a lawyer, undertook to obtain from the County Board of Cook County a retainer or contract for certain legal work, in connection with the foreclosure and collection of forfeited taxes, to be paid for on a percentage basis. On December 18, 1899, the County Commissioner Philip Knopf wrote to the Board of Commissioners of Cook County calling their attention to the fact that there were a large number of tracts of land which from year to year were forfeited to the State for nonpayment of taxes and from which no revenue was derived, and suggested to the board that foreclosure suits ought to be commenced in order to avoid the necessity of extending taxes and carrying them forward from year to year, and that as the work was of a special kind and outside of the County Attorney’susual duties, it ought to be done by a solicitor specially retained for that purpose who should be paid out of the proceeds of the suits.

On December 21, 1899, the defendant lies wrote to the board of commissioners that he had prepared bills for the foreclosure of property forfeited to the State for nonpayment of general taxes under the statutes; that in his opinion such suits should be speedily prosecuted; that they would involve a large amount of litigation; that he would prosecute them to final decree and sale upon condition that he be allowed and paid as solicitor’s fees a sum equivalent to one-fourth of all taxes, penalties, costs and fees recovered.

The evidence shows that the proposition made by the defendant lies was opposed by Irwin, the president of the board, and that, although a majority of the commissioners favored it, the president of the board could by his veto prevent its acceptance. Under the circumstances, the defendant Martin went to Jamieson, the complainant, and told him how the matter stood and that unless the opposition of Irwin was overcome the proposition of lies would not be granted. Jamieson asked Martin, according to the testimony of the latter, “what there would be in it for him if he could get sufficient political influence to get Mr. Irwin to agree to the acceptance of lies’ proposition.”

Martin further testified that he told Jamieson that Ues would take him in on a basis of giving him one-third of the proceeds of the collections if he would use his political influence to get Mr. James Irwin to agree to the proposition; that “he said he had considerable influence; that his father was State Central Committeeman of the Republican party and also that he would in addition to his own influence get the influence of William Lorimer to get James Irwin to agree to the proposition”; that, “if Mr. lies would give bim one-third of the profits he would get this influence to put the proposition through”; that he told Jamieson that “Mr. lies would agree to that and would enter into a contract in writing to divide the profits with him in return for the influence which he would furnish to get the consent of the President of the Board to the proposition”; that Jamieson told him that he went to James Irwin; that he also went to William Lorimer and that Lorimer “requested Mr. Irwin to accept the proposition”; that as a result of these circumstances he, Martin, entered into the contract with lies and Jamieson to give the latter one-third of the proceeds of the fees.

The evidence of the complainant is to the effect that Martin requested his assistance to obtain from the county board the contract which was subsequently entered into in the name of Robert S. Ues; that the latter was the one who conceived the idea and that he had been nnable to secure the contract from the committee ; that for “that reason” they went to him, because he happened to be on friendly terms with a number of the county officials, and he succeeded in getting the contract from the county board; that contract being taken in the name of Mr. lies, as shown in their written agreement.

On January 2, 1900, the County Board passed a resolution retaining Robert S. lies as attorney and solicitor to prosecute to final decree and sale “foreclosure suits upon all lands forfeited * * * for nonpayment of general taxes, now subject to foreclosure under the statutes of Illinois, as the same now stand and appear upon the records of Cook County”; and that he be allowed the equivalent of one-fourth of all recovered as solicitor’s fees, the balance to be paid into the county treasury.

On January 2, 1900, the complainant and the two defendants entered into a written .agreement which, after reciting that they had that day “formed a partnership for the purpose of foreclosing the delinquent tax liens” provided that said contract with the County Board should be taken in the name of lies and “be in trust for and inure to the benefit of the three parties * * * in equal proportion, that is to say, that the said three parties shall carry out the legal proceedings and that each of them shall pay one-third of all costs and expenses in connection with the foreclosure and in return each of said three parties shall receive for his own use and benefit one-third of a fee of twenty-five per cent of the proceeds, ’ ’ etc.

On March 12, 1901, the three parties entered into another written contract, which' after stating that they were then engaged “in legal work in connection witli certain foreclosures and have shared all expenses and profits equally,” provided that certain rent and office expenses should be paid out of the proceeds of the tax foreclosing business and that if that was not sufficient each should contribute equally to make up the deficit.

On December 9, 1902, the same parties entered into another written agreement which after referring to the two contracts of January 2, 1900, provided for the leasing of certain offices and for the payment of certain items of expense and charges which might arise in the conduct of the joint business. Although by that contract each of the three was to furnish his ■private office, it was provided that “out of the proceeds of tax collection business as far as possible” there should be paid $110 per month for rent; $45 per month for a stenographer; $25 per month for a clerk; $150 per year for telephone service and some other small items of charge.

Pursuant to their agreements the work was begun and carried on in the same suite of offices from May, 1900, until they separated in April, 1903. Complainant acted as treasurer and kept the books, signed all checks and had custody of the receipts and did some other work; Martin examined the claims of title on the tract indexes, etc.; and lies selected the suits that were to be brought, and determined the parties that were to be sued and did the trial work if there was any contest.

About May 1, 1905, the complainant moved to other offices in the Ashland Block and the defendants took other offices in the Rector Building. The tax forfeiture business was then continued by the two defendants, the complainant taking no part in any of the work except that which pertained to the case of People v. Davis. .

The evidence is conflicting as to just what transpired at the time of their separation. Martin states that they made an agreement of separation in the latter part of April, 1905, and that the complainant told him that if he was given the fee of a certain case that he had charge of and the defendants would pay the outstanding overdraft that they, the defendants, could take all the other cases and that he would take the case that he was then working on and dispose of it; that he told complainant that was satisfactory; that he figured out how much the complainant’s interest would come to on the books and paid him in cash out of his own pocket for his third interest; that he, Martin, and lies then took over the files and the docket to their new offices in the Sector Building; that from that time on the defendants proceeded to dispose of the cases which they had on hand, paid whatever expenses were necessary and did all the work.

The evidence of the complainant is that he made a proposition to each of the defendants which was substantially to give each one of them a check for $1,000 and allow him, the complainant, to keep all the cases; that Martin said it was worth a great deal more; that he, the complainant, then offered to take $1,000 from each of them and let them retain the business; that that is the only conversation he had with them as to any settlement.

The evidence of lies is to the effect that in a conversation with the complainant he told the latter that a fair way to do would be to take their account as it stood at that.time, at the time of the separation, and allow him his just proportion of the amount that was due him at that time, that is, according to the statements of April and June, 1905; that the complainant said all right, “then make up a statement so I’ll know what it is.”

At the time of the separation there was pending a large number of the 800 suits which had been begun, and some work had been done on all of them.

' The complainant claimed before the master that by the terms of the interlocutory decree he was entitled to one-third of all the fees derived from the tax foreclosures collected after June 7, 1905, and which were partnership business, less certain items of expense, and the master so held.

It was claimed by the defendants that in case of an accounting, the complainant should be charged for part of the office expenses of the defendants which were incurred after the separation and that the defendants also should be allowed compensation for their services after the separation. The master held, however, that in the absence of a special agreement a partner cannot charge his copartner for his personal services in connection with the firm’s business and, although, all the work was done by the defendants and none by the complainant, the latter is entitled to one-third of the net receipts.

The master stated the account as showing the balance due and unpaid the complainant—being one-third of the fees collected less certain limited expenses and less an overdraft of June 7, 1905, and three payments made to the complainant—as $3,913.37, and reported further that the complainant was entitled to one-third of the net fees when collected in certain pending and undisposed of cases. The final decree is substantially based upon the master’s findings save that in addition it allows interest on both amounts.

By the writ of error herein prosecuted the defendants’ claims are substantially as follows: (1) that the contract of January 2, 1900, between the complainant and the defendants created only a “working interest which ceased when he (complainant) ceased to work”; that, as, in the language of counsel for defendants: “There was a breach of the agreement by the complainant when he failed to render service jointly with the defendants to the conclusion of the cases in which fees sought to be accounted for were obtained, he is not entitled to an accounting as prayed for”; (2) that, as the contract of retainer was obtained through influence of' the complainant with members of the county board in return for the promise of a share in the profits of the retainer, the agreement of January 2, 1900, between the complainant and the defendants was illegal and void as against public policy.

It will be seen from the pleadings and evidence that the plaintiff asks to be allowed to profit from the services rendered by the defendants in certain cases since June 7,1905, although he, himself, rendered no services whatever save as he helped to obtain the retainer of lies by the County Board prior to January 2, 1900. The question arises, were the services the complainant rendered in regard to obtaining the retainer of lies by the County Board a legal consideration sufficient to support a binding promise by the defendants to pay him one-third of the proceeds of the retainer.

It is the law that where one, by his influence or help, assists in obtaining from a public body or board such as the county commissioners, the retainer of another as attorney to render legal services and is promised compensation for such influence or help, no binding contract arises. In other words, no obligation attaches to a promise of compensation for influence or help in obtaining from a public body, such as the county commissioners, a retainer as its attorney to render certain specified legal services.

It is a high standard of ethics and does not yet obtain in the domain of general commerce where all the participants are engaged in business solely for private profit. But, from time immemorial, it has been the law as to all dealings with official representatives of the people. What the complainant did may have been entirely innocent and for the public good, but for fear that in rendering such services the temptation might induce evil doing, the law has deemed it wise to rule that such services may never be sufficient consideration for a promise to which a legal obligation attaches. There is not a scintilla of evidence that any wrongdoing was contemplated or occurred, but that does not change the rule of law nor avoid its application. As the court said in Powers v. Skinner, 34 Vt. 274: “The law will not concede to any man, however honest he may be, the privilege of making a contract which it would not recognize when made by designing or corrupt men.”

In Providence Tool Co. v. Norris, 2 Wall. (U. S.) 45, which was an action to recover on a contract to pay Norris a sum of money if he would procure a contract to furnish war supplies for the government, Mr. Justice Field said: “There is no real difference in principle between agreements to procure favors from legislative bodies and agreements to procure favors in the shape of contracts from the heads of departments. The introduction of improper elements to control the action of both is the direct and inevitable result of all such arrangements. * * * All agreements for pecuniary considerations to control the business operations of the government * * * are void as-against public policy, without reference to the question whether improper means are contemplated or used in their execution. The law' looks to the general tendency of such agreements; and it closes the door to temptation by refusing them recognition in any of the courts of the country.”

In Meguire v. Corwine, 101 U. S. 108, the plaintiff brought suit on a promise by the defendant’s testator to pay him one-half of all the fees which the testator should receive as special counsel, that promise having lieen made by the testator in consideration of the assistance to be rendered by the plaintiff in procuring for the testator his appointment as special counsel of the United States in certain litigated cases known as the “Farragut prize cases.” In that case Mr. Justice Swayne used the following laiiguage:

“The law touching contracts like the one here in question has been often considered by this court, and is well settled by our adjudications. Marshall v. Balti more & O. R. Co., 16 How. (U. S.) 314; Providence Tool Co. v. Norris, 2 Wall. (U. S.) 45; Burke v. Child, 21 Wall. (U. S.) 441; Hall v. Coppell, 7 Wall. (U. S.) 542. It cannot be necessary to go over the same ground again. To do so would be a waste of time. The object of this opinion is rather to vindicate the application of our former rulings to this record than to give them new support. They do not need it.' Frauds of the class to which the one here disclosed belongs are an unmixed evil. Whether forbidden by a statute or condemned by public policy, the result is the same. No legal right can spring from such a. source. They are the sappers and miners of the public welfare, and of free government as well. The latter depends for its vitality upon the virtue and good faith of those for whom it exists, and of those by whom it is administered. Corruption is always the forerunner of despotism.”

In Burke v. Child, 21 Wall. (U. S.) 441, the court said: “Within the condemned category are: An agreement—to pay for supporting for election a candidate for sheriff * * * ; to pay for resigning a public position to make room for another * * *; to pay for not bidding at a sheriff’s sale of real property * * *; to pay for not bidding for articles to be sold by the government at auction * * *; to pay for not bidding for a contract to carry the mail on a specified route * * *; to pay a person for his aid and influence in procuring an office, and for not being a candidate himself * * *; to pay for procuring a contract from the government * * *; to pay for procuring signatures to a petition to the governor for a pardon * * *; to sell land to a particular person when the surrogate’s order to sell should have been obtained * * *; to pay for suppressing evidence and compounding a felony * * to convey and assign a part of what should come from an ancestor by descent, devise, or distribution * * *; to pay for promoting a marriage * * *; to influence the disposition of property by will in a particular way. * . * *”

Further, we are of the opinion that the motion of the solicitors for the defendants which was filed on March 23, 1914, requesting permission to file an amended plea setting up the illegality of the contract sued upon should have been allowed.

It makes no difference, in considering the matter before us, however, because it is the law that in case of an illegal contract, such as the one sued upon here, it is of no importance whether the illegality of the contract be set forth by plea or allegation by the defendant. As said in Isler v. Brunson, 6 Humph. (25 Tenn.) 277: “It is the duty of either court (that is law or equity) on grounds of business policy to repel the plaintiff and refuse its action on his behalf.” The court said in Wilde v. Wilde, 37 Neb. 891: “It is a sufficient answer to this contention that courts will refuse their aid in enforcing similar claims, not on account of any solicitude for the parties, but as a duty they owe the cause of justice and the integrity of its courts. Whenever it is apparent that an agreement is contrary to business policy and sound morals, it will be ignored by the court, even though both parties should assent to its enforcement.” Mr. Justice Cartwright said in Pietsch v. Pietsch, 245 Ill. 454: “If a cause of action is such as no court would entertain, a court is bound to raise the question in the interest of due administration of justice and not for the benefit or in the interest of either party. Whether a claim of illegality is made by the pleadings or not, parties cannot compel a court to. adjudicate upon alleged rights growing out of a contract void as against public policy or in violation of public law.”

For the reasons above set forth the decree is reversed and the cause remanded with directions to dismiss the bill of complaint for want of equity.

Reversed and remanded with directions.

O’Connor, J. and Thomson, J., concur.


source: Caselaw Access Project

author: Mr. Presiding Justice Taylor

license: Public Domain

text:
    J. C. Cooper, Plaintiff in Error, v. Peoples Trust and Savings Bank, Defendant in Error.
    Gen. No. 25,396.
    1. Banks and banking, § 134

      -—when bank is not liable for payment of cheek. A bank was not liable to a depositor for the amount of a check given by plaintiff in payment of an automobile, where defendant introduced no evidence and plaintiff’s evidence showed that the automobile was taken by the police as a stolen car and delivered to the true owner and where the pleadings, statement of claim, affidavit of merits and testimony led directly to the conclusion that plaintiff failed to prove that the payment of the check by defendant was not in reality to the payee, the person named in the check.
    2. Banks and banking, § 146*—when forgery of check is not shoivn. Although, if the automobile for which a check was given was a stolen one, a crime was committed by the payee in getting the check, that crime was getting money under false pretenses, and from that it followed that when the check was subsequently indorsed and negotiated and paid through the clearing house, a forgery was not necessarily committed, so as to hold the bank liable to the depositor for making payment according to the terms of the check.
    Error to the- Municipal Court of Chicago; the Hon. Irwin R. Hazen, Judge, presiding. Heard in this court at the October term, 1919.
    Affirmed.
    Opinion filed November 4, 1920.
    Albert O. Olson, for plaintiff in error.
    Cooke, Sullivan & Ricks, for defendant in error; Francis L. Daily and Frank A. Lasley, of counsel.

      See Illinois Notes Digest, Vols. XI to XV, and Cumulative Quarterly, same topic and section number.

   Mr. Presiding Justice Taylor

delivered the opinion of the court.

This is a suit by the plaintiff in error, J. C. Cooper, against the defendant for the amount of a check drawn by the plaintiff on the defendant bank- and paid by the defendant on an alleged forged indorsement. The plaintiff’s statement of claim sets forth elaborately what purports to be a history of the whole transaction and the affidavit of merits denies most of the important allegations of the statement of claim. The cause was tried before the court without a jury and at the close of the plaintiff’s evidence and upon motion by the defendant the court found the issues for the defendant and entered judgment thereon.

On May. 7, 1917, the plaintiff drew a check in the sum of $781 upon his account in the Peoples Trust & Savings Bank, the defendant, payable to the order of A. Johnson; he gave the check to one Guy Harrison. On the same day the check was presented to and certified by the defendant. The evidence does not show by whom. Subsequently one Weinberc went to the Hibernian Bank, “0. K.’d the check and the indorse- ' ment and it was paid-through that bank after acceptance by the defendant.”

The testimony of the plaintiff is that he drew the check on May 7, 1917,' on his account as a depositor with the defendant, Peoples Trust and Savings Bank, to pay for a Buick automobile; that one Harrison told him he had a Buick automobile and asked him if he wished to look at it and that he, the plaintiff, told him that if the car was all right he would take it; that subsequently Harrison said to the plaintiff, “I have deliveréd the automobile at your garage and you can make me out a check for it”; that he, the plaintiff, then said, “I won’t make out a check to you, I am buying it from the owner, I will make out a check only to him”; that Harrison then said, “I will come back and bring you the bill of sale and give it to you”; that he did come back and then said, “You can make out that check to A. Johnson, the owner of the automobile”; that Harrison said he was making a commission; that he, the plaintiff, then delivered to him the check; that he “relied upon him (Harrison) as being the agent of the owner to deliver that check.”

It is admitted in the defendant’s brief that it was stipulated that, if present, one Vaughn, a policeman, would testify that on May 28, 1917, he took a Buick car from Cooper as a stolen car and delivered it to one B. H. Barnett a.s the owner; that B. H. Barnett, if present, would testify that he was the owner of the car; that the check here in question never came to his, Barnett’s, hands; that he did not indorse it nor authorize any one to indorse it for him.

The defendant in its affidavit of merits stated that it did not admit that the check did not come from the hands of the said A. Johnson and was not indorsed by him or his order; that the said sum of $781 was not paid to him; that it does not admit that in April, 1917, one Guy Harrison made certain representations to the plaintiff or that Harrison brought a certain Johnson, an insurance adjuster, to the plaintiff, and does not admit that Harrison purported to sell the automobile to the plaintiff or that the plaintiff gave him a check as agent of and for the use of the said Johnson.

It is the contention of the plaintiff that in a suit by a depositor against a bank when the question is whether the bank has disbursed the depositor’s funds upon proper authority and to the proper parties the burden of proof is upon the bank and that the .bank is hable to the depositor if it pays to some one other than the intended payee and charges it to his account.

Although the evidence and the admissions seóm to show that one Barnett was the owner of the automobile that was delivered and purported to be sold to the plaintiff and that neither Johnson nor Harrison had any interest in it, and that the plaintiff gave Harrison a check payable to one A. Johnson in payment for the stolen automobile, and the check was subsequently certified and finally paid by the defendant bank, there is not sufficient evidence in the record of the failure of the bank to identify the payee' or that the bank was guilty of any negligence. And further there is no evidence that the check was not indorsed by A. Johnson or by his authority; for, although it is set up in the statement of claim that through the connivance of Harrison the cheek was signed and indorsed by a woman by the name of A. Johnson and not the payee described in said check, those allegations were denied in the amended affidavit of merits and of these facts no affirmative proof whatever was offered by the plaintiff.

A careful scrutiny of the pleadings, the statement of claim and the affidavit of merits and the evidence, which latter is contained in the testimony of the plaintiff and what purports to be such testimony as would have been given by Vaughn and Barnett, if called, leads directly to -the conclusion that the plaintiff has failed to prove that the payment of the check by the defendant was not, in reality, to the payee, the person named in the check. Of course, if the payment was made according to the terms of the check, the plaintiff is out of court. It is true that the defendant offered no evidence, but it does not follow from that that the plaintiff has shown that the indorsement was forged or that the defendant failed in its duty towards him. The check may have been obtained by Harrison from the plaintiff in payment for a stolen automobile, but, where the plaintiff under such circumstances gives a check payable to one Johnson and that check is subsequently certified and goes through the clearing house and is paid by the drawer’s bank, the bank is immune and entitled to charge up the check to the plaintiff’s account unless something in the way of guilty knowledge or negligence on the part of the bank is shown.

The plaintiff may have been deceived as to the true name of A. Johnson or as to who he was and mistaken as to the ownership of the automobile, but A. Johnson, or whoever represented himself to be A. Johnson, had the right to payment as between himself and the bank “it having no notice of or part in the fraud or the transaction in which it was practiced.” Meyer v. Indiana Nat. Bank, 27 Ind. App. 354. In the latter case that court further said: “Appellants are the victims of a fraud as bold as it was successful. They did not protect themselves when they could have done so, and the bank had neither opportunity nor power to take better care of them than they themselves did. ’ ’ McHenry v. Old Citizens’ Nat. Bank of Zanesville, 85 Ohio St. 203; Land Title & Trust Co. v. Northwestern Nat. Bank, 196 Pa. St. 230.

The plaintiff intended that the payee, one Johnson, should use the check, either get it cashed or indorse it over, and, of course, if the automobile for which the check was given was stolen, a 'crime was committed in getting the check, but that crime was getting money under false pretenses, and from that it follows that when the check was subsequently indorsed, and negotiated, and paid through the clearing house, that that did not necessarily involve a forgery.

Further, there is no evidence whatever that the indorsement of the name of the payee was not made by A. Johnson, and from that it follows that the plaintiff did not make out a prima facie case of lack of care on the part of the defendant. The plaintiff urges that that the burden of introdncing evidence to show that the defendant exercised appropriate care fell upon the defendant and that as the defendant offered no evidence judgment should have been entered in favor of the plaintiff. That contention is unsound. The plaintiff was bound first to make out a prima facie case. He failed to do so and it then became the duty of the trial judge to enter judgment for the defendant.

We are of the opinion that the evidence and admissions of the pleading (and the latter we are not legally bound to consider inasmuch as the rules of the municipal court are not contained in the bill of exceptions) entirely fail to prove .that the defendant either paid the cheek on a forged indorsement or was guilty of any negligence or other dereliction.

Finding no error in the record the judgment is affirmed.

Affirmed.

O’Connor, J. and Thomson, J., concur.


author: Mr. Justice O’Connor

text:
    Dora Joseph, Appellee, v. New York Life Insurance Company, Appellant.
    Gen. No. 25,300.
    1. Insurance, § 95

      —what constitutes contract of insurance. Under a life insurance policy expressly providing that the policy and application should constitute the entire contract and that no representations made by the insured in his application could be interposed as a defense unless they were contained in the written application, the insurer could not be heard to say that other questions were asked the assured and other answers made than those appearing in the written application.
    2. Insurance, § 204*—what is effect of good faith of applicant when policy is claimed to have been obtained by misrepresentation. Where it is sought to avoid a life insurance policy on the ground that the insured made false answers in his application, the question of the good faith of the applicant in making his answers, in the absence of an express provision that they are warranties, is always a material one, and the question in each case is whether the answers made by the applicant were knowingly false.
    3. Insurance, § 347*—what is effect of incontestible clause in policy. Although a policy provided for its incontestibility after one year from its issuance, and the insured died within about a month of such issuance and shortly thereafter notice of rescission was given, the company had the right to file pleas more than one year from the date of issuance. >
    Appeal from the Superior Court of Cook county; the Hon. M. L. McKinley, Judge, presiding. Heard in this court at the October term, 1919.
    Affirmed.
    Opinion filed November 4, 1920.
    Hamlin, Topliee & Cooper, for appellant; James H. McIntosh, of counsel.
    Moser, Bosenthal & Kennedy, for appellee; Walter Baohrach, of counsel.

      See Illinois Notes Digest, Void. XI to XV, and Cumulative Quarterly, s^me topic and section number.

   Mr. Justice O’Connor

delivered the opinion of the court.

On March 1, 1913, the New York Life Insurance Company issued its two policies to Simon Joseph, one for $1,000 and the other for $2,000, in which his wife, Dora Joseph, was named as beneficiary. March 30, 1913, Simon Joseph died. Liability under the policies was denied and Dora Joseph brought this suit. The case was decided on the pleadings. There was a finding and judgment in favor of plaintiff for $3,861.67, being the full amount of her claim, to reverse which defendant prosecutes this appeal.

The declaration consisted of two counts, one on each policy. The policies, of which the applications were a part, were set out in hose verba and each contained the following provision: “The policy and the application therefor constitute the entire contract between the parties. All statements made by the insured shall, in absence of fraud, be deemed representations and not warranties, and no such statements shall avoid this policy or be used in defense to a claim hereunder unless it be contained in said written application, a copy of which was attached to this policy when delivered. ’ ’ The applications were attached to the policies and set out questions put to Joseph, and answers made by him. The application also set out “Answers made to the Medical Examiner,” and contained the following: “I warrant and declare, on behalf of myself and of every person who shall have or claim any interest in any insurance made hereunder, that I have carefully read each and all of the above answers, that they are each written as made by me, that each of them is full, complete and true, and that to the best of my knowledge and belief I am a proper subject for life insurance. Each and all of my said answers are made by me to obtain said insurance, and I understand and agree that they are each material to the risk and that the Company believing them to be true will rely and act upon them.” To each count defendant filed a special plea which set up that Simon Joseph had misrepresented and concealed material matters concerning the state of his health; that upon discovery of these facts (after Joseph’s death) the company elected to rescind the policies and tendered back the premiums; that the tender was refused.

It was averred in the pleas that Joseph applied for insurance and submitted himself to defendant’s physician for examination both orally and physically so that it could determine whether or not to issue a policy to him; that the following questions were put to Joseph and that he made the. following answers:

“Q. Have you ever raised or spat blood? A. No.
‘ ‘ Q. Have you ever had or suffered from any of the following diseases:
(A) Of the brain or nervous system? A. No.
(B) Of the heart or lungs ? A. No.
(C) Of the stomach, intestines, liver, kidneys or bladder? A. No.
(D) Of the skin, middle ear or eyes? A. No.
(E) Rheumatism, gout or syphilis? A. No.
“Q. Have you consulted any physician for any ailment or illness not mentioned above? A. No.”

Thereupon the Medical Examiner asked Joseph the following question:

“Q. -Has the applicant recently lost weight, and if so, how much, and to what is it due?”

And that Joseph answered that he had not. The plea then avers that each of the answers was false and untrue and that Joseph “knew them to be false arid untrue” and knew that they were to be relied and acted upon by the defendant in determining whether a policy should issue; that Joseph made them “with such knowledge for the purpose of defrauding and deceiving the defendant” and inducing it to issue a policy. The plea further averred that for 6 months prior to the examination Joseph had been passing blood and lost in weight approximately 30 pounds; that he was under the care of a physician for enteritis caused by carcinoma or cancer of the intestines; that he was then preparing for an operation for the removal of the cancer; that he was operated on and died shortly thereafter as a result thereof; that Joseph had been under the care of a physician for such disease long prior to the examination, “all of which said Joseph well knew and concealed from said examiner” for the purpose of defrauding the defendant and inducing it to issue a policy; that the answers were taken to be true and the company issued its policies on the strength of them, and upon discovery of the fraud after Joseph’s death it tendered back the premium and claimed the policies were void. Afterward defendant filed additional pleas which were substantially like the special plea first filed except that a copy of the questions put to and the answers made by Joseph were set out in hcec verba in these pleas. It was also averred that Joseph knew his answers were false and untrue, and that he purposely, and with intent to deceive, concealed the true facts and that he knew that the policies would be issued in reliance .upon the truthfulness of his answers. To these pleas plaintiff filed several replications, among other things setting up that if the answers made by Joseph were untrue he did not know that they were untrue; that he did not know he had suffered from any of the diseases mentioned in the questions put to him. Defendant demurred to these replications and the demurrer was overruled. The first special plea was held bad on demurrer and defendant refusing to plead further, judgment was entered against it for the amount claimed. '

Defendant first contends that its special plea set up a good defense of rescission by it of the policies on the ground that they were obtained by misrepresentation and concealment of material facts as to the state of health of the assured; that its defense is based not ‘‘ on the contract” but on a rescission of it; that after the death of Joseph the insurance company first learned of the deception practiced upon it and that it then notified plaintiff of the deception, tendered back the premium and denied liability on the policies; that this constituted a rescission of the contract. In any view of the case, we must determine whether this plea set up a good defense. We think it did not, for the reason that it sought to set up the question whether Joseph had recently lost weight and the answers made which were not contained in the application, contrary to the terms of the policy, for it was there expressly provided that the policy and application should constitute the entire contract, and that no representation made by the assured in his application could be interposed as a defense to the policy unless such representation was contained in the written application. Defendant could not be heard to say that other questions were asked the assured and other answers made than those appearing in the written application. This it sought to do and the demurrer was, therefore, properly sustained. In the case of Archer v. Equitable Life Assur. Society, 218 N. Y. 18, it was held that the insurance company could not interpose as a defense to an action on one of its policies that the assured had intentionally made false representations to questions asked him for the reason that the statute of that State provided that every policy issued should constitute the entire contract between the parties and that nothing should be incorporated by reference to any constitution, bylaws, rules, application or other writing “unless the same are indorsed upon or attached to the policy.” It was there said: “It is clear that the legislature enacted by the section that the policy, that is, the paper or document, should contain, physically, the entire contract.” And we think it can make no difference whether the provision is found in the statute or in the contract itself.

It is next contended by defendant that where answers made by the assured to questions put to him are false, this avoids the policy whether the assured knew that they were false or not, that it is of no avail that the assured did not know his answers were untrue. This question is not at all free from difficulty and the decisions of this and other States are apparently not harmonious. , The defendant in support of this proposition cites the cases of United States Fidelity & Guaranty Co. v. First Nat. Bank of Dundee, 233 Ill. 475; Smith v. Bankers Life Ass’n, 157 Ill. App. 236; Davis v. Catholic Order of Foresters, 165 Ill. App. 137.

The United States Fidelity Co. case was a suit in chancery seeking the cancellation of a fidelity bond guaranteeing the bank against loss by reason of any wrongdoing of its employees, including its cashier, on the ground that the bond was procured by false and fraudulent representations of the bank to the effect that the books and accounts of the bank “were examined by us from time to time in the regular course of business and we found them correct”; that all the moneys handled by the cashier had been accounted for and that he had performed his duties in an acceptable and satisfactory manner. The bank denied that there were any misrepresentations made and filed its cross-bill seeking to recover the amount of money which its cashier had embezzled during the period covered by the bond. The chancellor found that the bank had made no misrepresentations and held the company liable. The decree was affirmed by this court, 137 Ill. App. 382, where the court said (p. 391): “We conclude, therefore, that the statements or representations made in the certificate * * * were justified b>y the facts and were substantially true.” The Supreme Court affirmed the judgment of this court, and said (p. 483): “Appellant insists that the failure of the bank to discover this discrepancy (of the cashier) is conclusive proof that no examination was, in fact, made. This conclusion is not warranted by the facts and circumstances in this record.” And continuing the court further said (p. 485): “We, therefore, agree with the conclusion of the trial court and the Appellate Court that the certificate of January 22, 1902, was substantially true.” From this it clearly appears that the question whether the hank knew that at the time it applied for the bond the cashier was short in his accounts was in no way involved—the question of knowledge was not in the case. There was no misrepresentation in fact made. 0

The Smith case was an action on an insurance policy. The defense was that the assured had made false representations by way of answer to questions put to him in his application for insurance and that the policy was, therefore, void. The evidence showed (see same case 123 Ill. App. 392) that the assured had been consulting several physicians at different times up until a short time before he applied for insurance, and that the answers made by him to the questions were knowingly false. The court, there speaking by Mr. Justice Holdom, said (p. 237): “Whether the answer of Black that he was in good health at the time of his application for membership in' defendant association was a representation or a warranty, is of no moment. Such answer was not only material but vital to the making of the contract of insurance, and therefore whether the answer was intentionally false or simply erroneous is of no importance. If untrue in fact, it vitiates and voids the certificate issued in faith of its verity.” In that case it is obvious that the assured knowingly made false answers to the questions put to him touching the state of his health.

The Davis case was a suit upon a benefit certificate. It was provided in the contract of insurance that the answers made in the application were warranties. The pleas set up that the insured knowingly made false answers to questions in the application put to him as to his health. It is there said (p. 144): “It has also been held that a material misrepresentation, whether made intentionally and knowingly or through mistake and in good faith, will avoid the policy.” In that case also the evidence showed that the insured must be presumed to have known that the answers made by him were false.

In Minnesota Mut. Life Ins. Co. v. Link, 230 Ill. 273, which was an action on a life insurance policy, the court, by Mr. Justice Vickers (p. 274), said: “The trial court held that the alleged false statements were mere representations and not warranties, and that appellant could not rest a defense upon such statements without averring and proving their materiality and that they were known to be false by the assured at the time they were made.” There the contention of the insurance company was that the assured, by answering in the negative to questions asking whether he had ever had any of the enumerated diseases, warranted the answers to be true, “and that if they were false in any particular such falsity will avoid the policy, whether such answers were material to the risk or not, and notwithstanding they may have been made unintentionally and innocently through mere mistake or inadvertence.” Continuing the court said (p. 276): “It is not reasonable to suppose that Miller took this policy with the distinct understanding that it would be void and that all premiums paid by him on it were a mere gratuity conferred upon the company, and yet, if the absolute truth of all of the answers to the more than three-score questions was warranted, there is scarcely a probability that any liability could ever accrue on such policy. It is well known, as is observed by the Supreme Court of the United States in Moulor v. American Life Ins. Co., 111 U. S. 335, that a person may have diseases of the presence of which in his system he has and can have no knowledge and which even skillful physicians are unable to discover after a most searching examination. It is therefore unreasonable that persons who organize corporations for.the purpose of selling life insurance would exact a warranty of an applicant for insurance of the truth of a matter which, from the very nature of the inquiry, might be wholly unknown to the applicant, and still more unreasonable that any sane person would knowingly warrant that he had never had, in any form or any degree, any disease .embraced within the long catalogue embodied in this application. ’ ’

Globe Mut. Life Ins. Ass’n v. Wagner, 188 Ill. 133, was an action of assumpsit brought on an insurance policy. The chief ground of defense was that the assured made a false answer to the question, “How many brothers dead?” The evidence showed that a brother of the assured had died in London more than 4 years before the application. There was no evidence that he knew his brother was dead but it was contended that whether he knew it or not made no difference and that since the answer was false the policy was void. The court there said (p. 137): “In the absence of explicit, unequivocal stipulations requiring such an interpretation, it should not be inferred that the insured or the appellee took a life policy with the distinct understanding that it should be void if any statements made in the medical examination should be false, whether the insured was conscious of the falsity thereof or not. (Moulor v. American Life Ins. Co., 111 U. S. 335.) Whether or not the deceased knew of the death of his brother at the time of the application for insurance was a question for the jury, and no evidence of such knowledge appears in the record. To hold that, as a precedent to any binding contract, he should guarantee absolutely that none of his brothers were dead would be unreasonable, in the absence of a more explicit stipulation than here appears. It not infrequently happens that a man loses trace of all or a part of his relations, and to hold him to absolutely guarantee that they were living, in order that he might obtain insurance, would sometimes be to require an impossibility, and would be almost absurd.” The court then quotes with approval from the Moulor case and held that false answers in the absence of knowledge on the part of the assured at the time would not avoid the policy.

Moulor v. American Life Ins. Co., 111 U. S. 335, above referred to, was an action on a policy of insurance. “The main defense was that the insured had been afflicted with scrofula, asthma and consumption prior to the making of his application, and that, in view of his statement that he had never been so afflicted, the policy was, by its. terms, null and void.” There was evidence tending to show that the assured had been afflicted with some of these diseases prior to his application. There was also evidence tending to show that he was in sound health at that time and that he did not know or believe that he had been afflicted with any of these diseases. The trial judg'e instructed the jury that it was of no consequence in such case whether the insured knew his answers true or not; that he was bound by them. The Supreme Court on review held that if his answers were warranties, no recovery could be had unless they were true, but if the answers were not warranties, the question whether the answers were knowingly false was a material one. Mr. Justice Harlan, delivering the opinion of the court, said (p. 343): “The applicant was required to answer yes or no as to whether he had been afflicted with certain diseases. In respect of some of those diseases, particularly consumption, and diseases of the lungs, heart and other internal organs, common experience informs us that an individual may have them, in active form, without at the time being conscious of the fact, and beyond the power of any one, however learned or skilful, to discover. Did the company expect, when requiring categorical answers as to the existence of diseases of that character, that the applicant should answer with absolute, certainty about matters of which certainty could not possibly be predicated? Did it intend to put upon him the responsibility of knowing that which, perhaps, no one, however thoroughly trained in the study of human diseases, could possibly ascertain?” Continuing the court further said: “If it be said that an individual could not be afflicted with the diseases specified in the application, without being cognizant of the fact, the answer is that the jury would, in that case, have no serious difficulty in finding that he had failed to communicate to the company what he knew or should have known was material to the risk, and that consequently, for the want of ‘fair and true answers,’ the policy was, by its terms, null and void.” It was held that unless his answer was knowingly false, relief would not be barred and that the question was one for the jury.

In Bloomington Mut. Life Benefit Ass’n v. Cummins, 53 Ill. App. 530, it is said: ‘ ‘The rule of law is believed to be in regard to representations, as distinguished from warranties, that motive, or knowledge of material facts about which direct inquiry is made, is not issuable, but is as to immaterial facts. * * * There may be some exceptions to this general rule, as in the case of lurking or constitutional tendency to certain diseases of the insured, which may even be manifest to the careful observer, and yet not be consciously recognized by the insured himself. It is natural for a man to desire to disbelieve that his body is afflicted with a constitutional taint, and therefore he does not readily give credence to manifestations that to other people a,re apparent. Therefore, as to such matters, it is insisted in many well considered cases that the honesty and good faith of his answers, even to direct inquiry, is an issuable fact. Moulor v. American Life Ins. Co., 111 U. S. 335. If such tendencies are manifest at the time of the insurance, there seems to be no good reason why the insurance company should not protect itself by the physical examination of its medical examiner. If in such case the examiner reports the insured as a fit subject for insurance, this is some evidence that the insured himself was not at the time aware of the character of his affliction, and the legal effect of his answers should be determined by the test of honesty and good faith.”

In Metropolitan Life Ins. Co. v. Larson, 85 Ill. App. 143, it was held that false answers in an application for insurance did not necessarily invalidate the contract unless the answers were known to be false at the time made, and were made by the applicant for the purpose of defrauding the insurance company. To the same effect is Globe Mut. Life Ass’n v. March, 118 Ill. App. 261. See also the case of Raymer v. Modern Brotherhood of America, 157 Ill. App. 510, where the plea was that the insured had knowingly made false answers in his application. Mr. Justice Dibell, speaking for the court, said (p. 519): “As already shown, the form of the issues submitted by appellant made the validity of the defense here interposed to depend upon whether Arthur Baymer made the answers in good faith, believing them to be true. We are of the opinion that it is the general tenor of the cases cited and also of Globe Mut. Life Ins. Ass’n v. Wagner, 188 Ill. 133, * * * that all that was required of the applicant was that the answers should be a fair statement of the facts, honestly and truly given, as understood by the applicant. Moreover, it is a rule applicable to contracts generally that to authorize rescission because of the untruth of a representation relied upon in making a contract, it must be shown that the party making the untrue representation knew or believed it to be untrue. * * * ‘No misrepresentation is fraudulent at law, unless it is made with actual knowledge of its falsity, or under such circumstances that the law mus.t necessarily impute such knowledge to the party at the time when he makes it.’ Therefore both by the rules of law appEcable to the case and by the issues upon which the case was tried, it was essential to establish a defense that it be proven not only that some representation made by Arthur Raymer was material and untrue, but also that he knew it to be untrue or did not act in good faith in making it.”

In Deming v. Prudential Ins. Co. of America, 169 Ill. App. 96, it was held that to avoid a policy on the ground of false answers “it should appear from the proofs the answers of Deming were false at the time they were made, that he knew that they were untrue and that the fact concealed or the falsehood expressed was material to the risk. Globe Mut. Ins. Ass’n v. Wagner, 188 Ill. 133.”

In passing on this same question in the case of Diehl v. Mutual Life Ins. Co., 176 Ill. App. 462, the court said (p. 465): “Representations in an application for insurance made in good faith, even though untrue will not prevent a recovery. To avail as a defense, the defense must aver and prove the representations in an appEcation for insurance are false and that the applicant knew them to be false at the time he made them. This proposition is supported by the following authorities : Continental Life Ins. Co. v. Rogers, 119 Ill. 474; Globe Mut. Life Ins. Ass’n v. Wagner, 188 Ill. 133, and Provident Sav. Life Assur. Society v. Cannon, 103 Ill. App. 536. ’

In 25 Cyc. 801, it,is said: “Representations as to a material matter which are false in fact avoid the policy, although not fraudulently made. But so far as the questions propounded in the application call for answers founded upon the knowledge or belief of the applicant, a misstatement or omission to answer will not avoid the policy unless wilfully and knowingly made with an attempt to deceive.”

In 1 Bacon on Insurance, sec. 265, the author in discussing the question under consideration said: “In a case where the issue was as to false representation in an application as to the good health and freedom from disease of the applicant, in holding that tuberculosis of the lungs or of the bones of the wrist is a material matter, the court (86 Neb. 372) said: ‘If the applicant had no knowledge of the fact that his lungs were afflicted with tuberculosis, or that it was tubercular disease of the bones of the wrist * * * and the answers to the questions in the application were not made as absolute statements of facts, but as matters of belief or opinion, and as to which he might be honestly mistaken, then, under former decisions of this court, the answers were mere representations, and his beneficiary might recover if they were made honestly and in good faith. * * * If the evidence should prove, however, that he had consulted reputable physicians as to his condition, and that he had been told by them that he was suffering from such an insidious and dangerous disease as tuberculosis at a time so near the time of making the application as to rebut and repel the idea of forgetfulness or good faith on his part, the concealment of such a fact, so material to the risk, and one that, if known, his application would have been rejected, would avoid the contract.’ ”

In Royal Neighbors of America v. Wallace (Neb.), 99 N. W. 256, the court said: “The plaintiff in error * * * insists that knowledge of the falsity of her answers by the insured is immaterial; that the true rule is that a false representation in a matter material to the risk avoids the policy, regardless of whether the applicant knew the representation to he false or not. As to matters with which the applicant is charged with knowledge, this is undoubtedly true, and this court has held that a false representation relating to the amount of liens on property will avoid a fire risk taken thereon. * # * Where, however, the questions propounded to the insured in his application are such that, in the nature of things, he can only express his opinion, giving his best judgment, this rule does not and should not obtain. * •* * Whether a party is at the time affected with any disease which can be said to affect the risk, or whether at some prior period of his life he has suffered from any particular disease, is a matter upon which the best medical men of the country often differ, and are often in doubt, and to say that an honest answer given by the applicant—an answer containing his best judgment and honest opinion —would avoid the risk is going further than we think is warranted by the authorities.”

From a consideration of the authorities to which we have referred and of many others which we have examined, we think the law is that where it is sought to avoid a policy on the ground that the insured made false answers in his application, the question of the good faith of the. applicant in making his answers (in the absence of an express provision that they are warranties) is always a material one, and as Mr. Justice Harlan said in the Moulor case: “If it be said that an individual could not be afflicted with the diseases specified in the application without being cognizant of the fact, the answer is that the jury, in that case, would have no serious difficulty in finding that he had failed to communicate to the company what he knew or should have known was material to the risk, * * * and the policy was, by its terms, null and void.”

While there is some apparent conflict in the language used in the reported opinions, yet we think upon a careful analysis of each" case it will be found that there is no real conflict; that the question in each case is whether the answers made by the applicant were knowingly false. Other authorities sustain this view. Donahue v. Mutual Life Ins. Co., 37 N. Dak. 203; Baer v. State Life Ins. Co., 256 Pa. 177; Oplinger v. New York Life Ins. Co., 253 Pa. 328; Sharrer v. Capital Life Ins. Co., 102 Kan. 650; Reserve Loan Life Ins. Co. v. Isom, 173 Pac. (Okla.) 841; Mutual Life Ins. Co. v. Morgan, 39 Okla. 205; Guarraia v. Metropolitan Life Ins. Co., 90 N. J. L. 682; Suravitz v. Prudential Ins. Co., 244 Pa. 582.

In the instant case, the pleas filed by the defendant expressly averred that the answers as made by the insured to the questions propounded to him were knowingly false. The replication denied that the answers were knowingly false and thus joined issue on that question. We are, therefore, of the opinion that the demurrer to the replication was properly overruled.

Plaintiff makes the point that since the policies provided that they should be incontestible after one year from the date of issue, that certain pleas of the defendant filed more than one year after the date of the issuance of the policies would not lie. The policies were in effect but about a month when the deceased died. Shortly thereafter the defendant notified plaintiff that they had rescinded the policies and denied any liability thereunder, and within a few months this suit was brought. The defendant at different times filed its pleas, some of them more than one year from the date of the issuance of the policies. We think it had the right to do this.

The judgment of the superior court of Cook county is affirmed.

Affirmed.

Taylor, P. J. and Thomson, J., concur.