author: Mr. Justice Brown

text:
    John S. Townsend, Plaintiff in Error, v. The Equitable Life Assurance Society of the United States, Defendant in Error.
    Gen. No. 18,183.
    1. Accounts, § 19

      —when sustaining demurrer to till for an accounting not an atuse of trial court’s discretion. On bill in equity for a discovery and an accounting of amount due on a Tontine policy of insurance alleging that the accounts are intricate and complicated, requiring the skill of an expert accountant to audit them, action of court in sustaining a demurrer to the bill on ground that there is an adequate remedy at law held not an abuse of discretion, there being no specific or definite allegations of fraud nor of inequitable distribution or disposition of the assets involved in the contract between the complainant and the insurance company, and the bill not being strictly a bill for discovery.
    2. Trusts, § 263

      —when till does not lie to compel accounting of amount due on insurance policy. A life insurance society is not a trustee of a tontine fund so that the insured may maintain a bill in equity to compel an accounting for its administration on the theory of a trust relation existing between the company and the policy holders.
    3. Discovery, § 7

      —sufficiency of till. A bill is not strictly and merely a bill for discovery where it waives an answer under oath.
    4. Production of books and papers, § 3*—proceedings in which production may te required. In actions at law as well as in equity, the parties may, upon motion, be required to produce books and writings in their possession or power which contain evidence pertinent to the issue.
    Error to the Superior Court of Cook county; the Hon. Theodore Brentano, Judge, presiding. Heard in this court at the March term, 1912.
    Affirmed.
    Opinion filed November 24, 1913.
    Statement by the Court. John S. Townsend, the complainant below and plaintiff in error here, who was a policy holder in The Equitable Life Assurance Society of the United States, brought a bill in equity (afterwards amended) in the Superior Court of Cook County against that corporation November 22, 1909. To reverse a decree sustaining a general demurrer to the amended bill and dismissing it at complainant’s costs after Ms election to stand by it, entered by said Superior Court November 22, 1911, this writ of error is prosecuted.
    The policy is numbered 248,178, dated September 4, 1892, and recites that in consideration of twenty annual payments of $290.90 each The Equitable Life Assurance Society “promises to pay to John S. Townsend, his executors, administrators or assigns, the sum of ten thousand dollars, (any indebtedness to the Society on account of this contract to be first deducted therefrom) at the office of the Society in the city of New York within sixty days after satisfactory proofs of the death of said John S. Townsend of Chicago, in the County of Cook, State of Illinois, shall have been furnished to the Society at its said office.”
    After stating in a succeeding paragraph the conditions under which the policy shall be incontestable after three years from date, the policy proceeds:
    “This policy is issued and accepted upon the condition that the provisions and requirements, printed of written by the Society upon the back of this policy are acepted by the assured as part of this contract as fully as if they were printed at length over the signatures hereto affixed. ’ ’
    Following the signatures for the Company is the provision:
    “No person except the President, Vice-President, Actuary, Secretary or Assistant Secretary is authorized to make, alter or discharge contracts or waive forfeitures. ’ ’
    Printed on the left side of the policy are these statements among others:
    “1. That this policy is issued under the Tontine Savings Fund Plan, the particulars of wMch are as follows:
    2. That the tontine dividend period for this policy shall be completed on the fourth day of September in the year 1902.
    3. That no dividend shall be allowed or paid upon this policy unless the person whose life is hereby assured shall survive the completion of its tontine dividend period as aforesaid and unless this policy shall be then in force.
    4. That all surplus or profits derived from such policies on the Tontine Savings Fund Assurance Plan as shall not be in force at the date of the completion of their respective tontine dividend periods shall be apportioned equitably among such policies as shall complete their tontine dividend periods.
    5. That upon the completion of the tontine dividend period on September 4,1902, provided this policy shall not have been terminated previously by lapse or death, the said John S. Townsend shall have the option either -first, to withdraw in cash this policy’s entire share of the assets, i. e. the accumulated reserve, which shall he four thousand four hundred and forty-seven and 60/100 dollars and in addition thereto the surplus apportioned hy this Society to this policy; secondly, to convert the same into a paid up policy for an equivalent amount, provided always that if this amount of said paid up policy shall exceed the original amount of the assurance a satisfactory certificate of good health from one of the Society’s medical examiners shall be required; thirdly, to continue the assurance for the original amount and apply the entire tontine dividend to the purchase of an annuity, which together with the annual dividend on this policy shall be paid in cash to said John S. Townsend or assigns; or, fourthly, to withdraw in cash the share of the accumulated surplus apportioned by said Society to this policy and continue the policy in force on the ordinary plan.
    6. That previous to the completion of its tontine dividend period this policy can have no surrender value in cash or in a paid up policy. ********,
    8. After the completion of the tontine dividend period while this policy shall remain in force it shall be entitled to all the rights and privileges of ordinary policies of the same age and kind. ********
    13. The contract between the parties hereto is completely set forth in this policy and the application therefor, taken together, and none of its terms can be modified nor any forfeiture under it waived, except by an agreement in writing signed by the President, Vice-President, Actuary, Secretary or Assistant Secretary of the Society, whose authority for this purpose will not be delegated.”
    We have placed the clause in the 5th paragraph particularly involved in the present litigation in italics.
    According to the allegations of the bill, upon the maturity of said policy on September 4, 1902, Townsend elected to withdraw in cash the entire amount due him under said policy, and thereafter so notified the defendant Company, and the said Assurance Society, through its President, on May 7, 1906, notified him that the cash surrender value of the policy was $7,324.80. The implications of the bill are that the Society was' willing to pay the complainant this amount but no more; that the complainant refused to accept this amount as the sum due him; that in consequence no settlement nor any payment was made, and this bill in chancery was filed, which asks answers to eleven special interrogatories concerning the number issued of policies of the class to which the one here involved belonged, the number of lapses, surrenders, deaths and payment connected with' said class, profits, income and expenses of the Society so far as they relate to the class of policies to which No. 248,178 belongs, and closes with the prayer:
    “That an accounting may be taken under the direction of this Honorable Court of all and every the dealings and transactions of said Assurance Society which have any bearing or relation to the full adjustment of the claim of your' orator upon the policy aforesaid, and that the respective rights of your orator and the said Assurance Society under said policy may be ascertained and that the defendant The Equitable Life Assurance Society of the United States may be decreed to pay to your orator whatever amount shall appear upon such accounting to be due to the complainant from the said defendant.”

      As further ground for calling on the court by this bill for the decree prayed, the complainant sets up in his bill that the defendant is a foreign corporation engaged in the business of life insurance and licensed to do business in Illinois; that a general agent of the defendant solicited him to take the policy in question and to that end placed before him a written document which contained the following statements:
    “The Tontine Savings Fund plan of assurance was devised by The Equitable Life Assurance Society of the United States.
    In order to secure a policy on this plan with its special advantages, dividends and surrender values must be waived during the Tontine period. All profits are accumulated for the benefit of those who survive and whose policies are in force upon the completion of the Tontine period. Many companies allow no cash values for surrendered or lapsed policies, while the rest make it a rule to give in cash only a fractional part of the reserve. ( The Reserve ’ is the full value of a policy as determined by law). One of the chief advantages of the Tontine Savings Fund Policy of the Equitable is, that the Society guarantees to give the policy holder at the-end of the Tontine period the entire Reserve in cash if he chooses to withdraw it, and the exact amount of this Reserve may be written in the policy when issued. The surplus is guaranteed as well as the Reserve, but its exact amount cannot be determined in advance. Res. $4,076.00.

    The figures entered on the blank on the other side of this sheet are taken from the Tontine Blue Book of Estimates now in use by the Equitable Life Assurance Society of the United States. While it is to be understood that these calculations are simply estimates, it is to be remembered also that they are based upon the actual experience of the Society for a number of years. Even should the results fall slightly below the estimates, it is believed that they will be more favorable than the results noio shown by any company on any other form of policy.

    Frank H. Rood, General Agent.
    See estimates other side.”

      On the other side of the same sheet, among other things, were these:
    “Estimate based on actual experience. See explanation other side. Amount of Policy, $10,000. Tontine period, 20 years. Age 28. Annual premium, $290.90.
    Total premiums paid in 20 years........$5,818.00
    At the end of the Tontine period you will have the privilege of choosing any one of the following methods of settlement:
    1. TOTAL CASH VALUE.
    Cash value at end of Tontine period estimated at $10,430.00.
    2. PAID UP POLICY payable at death estimated at $25,600.
    3. ANNUITY.
    sfc * * * *
    Estimated annuity........................$518
    * # * & #
    sJS:
    4. SURPLUS IN CASH.
    Withdraw the accumulated surplus (or profits) in cash, estimated at $5,982.00.
    The original policy being now paid up for $10,000, with annual dividends.
    Dated at Chicago, Ill., Aug. 30, 1882.
    Frank H. Hood,
    Grenl. Agent. ’ ’
    The complainant says he relied on the representations thus made in consenting to take the policy before described; that he duly paid the premium mentioned for twenty years successively; that after electing on September 4, 1902, to withdraw in cash the entire amount due him under said policy, and after so notifying the defendant Society, he from time to time has demanded an accounting from it for the purpose of ascertaining the exact amount due to him under the policy, but that the said Assurance Society has declined to account to him in any way or to furnish any data to him from which the amount due to him upon the said policy from the said Assurance Society, in-eluding the surplus or profits, could he ascertained. This clause then follows in the bill:
    “And your orator further avers that the information and data relating to this particular, to-wit, pertaining to policies issued by said defendant under said Tontine plan, is wholly and exclusively within the knowledge of the defendant and that this complainant has no means whereby the same may be obtained save from the said defendant; that the accounts of said defendant relating to the aforesaid Tontine policy fund and plan are intricate and complicated and would require the skill of expert accountants to' audit same.”
    The complainant further asserts that the figure of $7,324.80 named by the defendant as the sum due him is not correct; that the amount should be at least $10,000; that said amount of $7,324.80 is wholly in conflict with the original .statement issued to him by said Assurance Society as before set forth; that the said defendant has failed to make an equitable distribution of the tontine fund among the surviving policy holders and has from time to time made different settlements upon a different basis with different holders of tontine policies, making discriminations between one and another.
    Appended to the bill as an exhibit and made a part thereof is the charter of the defendant Society. The only parts of which that seem pertinent to mention except article III and that part of article VI hereinafter quoted in full, are provisions that the corporate powers of the Society shall be vested in a Board of Directors and shall be exercised by them, and by such officers and agents as they may appoint and empower ; that said directors shall have power to enact by-laws, rules and regulations for the government of the officers and agents and for the management of the affairs of the Company and amend or repeal such bylaws, rules and regulations at pleasure; that the directors may determine the rates of premiums and the amounts to be insured on any one life and the terms of such insurance, and shall have power to purchase for the benefit of the Company any policies of insurance, dividends or other obligations issued by the Company.
    Article III is: “The capital of said Company shall be one hundred thousand dollars in cash, divided into one thousand shares of one hundred dollars each, which shall be personal property transferable only on the books of the Company in conformity with its by-laws.
    The holders of the said capital stock may receive a semi-annual dividend on the stock so held by them, not to exceed three and one-half per cent, of the same; such dividends to be paid at the times and in the manner designated by the Directors of said Company.

      The earnings and receipts of said Company over and above the dividends, losses and expenses shall he accumulated.”

    Article VI with the exception of its last clause, not pertinent hereto is:
    “The insurance business of the Company shall be conducted upon the mutual plan. All premiums shall be payable in cash. In case any policy holder shall omit to pay any premium due from him to the Company, or violate any other condition of the policy of insurance, the Board of Directors may forfeit his policy and apply all previous payments to the benefit of the Company.
    The officers of the Company, within sixty days from the expiration of the first five years from Dec. 31,1859, and within the first sixty days of every subsequent period of five years, shall cause a balance to be struck of the affairs of the Company, which shall exhibit its assets and liabilities both present and contingent, and also the net surplus after deducting a sufficient amount to cover all outstanding risks and other obligations. Each policy holder shall he credited with an equitable share of the said surplus. Such equitable share after being ascertained shall be applied to the purchase of an additional amount of insurance (payable at death or with the policy itself) expressing the reversionary value of such equitable share at such interest as the Directors may designate, or if any policy holder shall so direct, such equitable share of surplus shall be applied to the purchase of annuity at such rates of interest as the Directors shall designate to be applied in the reduction of his or her future premiums. In case of death, the amount standing to the credit of the party insured, at the last preceding- striking of balance as aforesaid, shall be paid over to the person entitled to receive the same, and the proportion of surplus equitably belonging to him or her at the next subsequent striking of balance shall also be paid when the same shall have been ascertained and declared.
    In case of the death of any party insured prior to passing any period for striking of balance as aforesaid, the Board of Directors may provide what (if any) share of such surplus shall be paid to such person.” The italics as before are our own.
    The ground taken by the defendant in support of the general demurrer below and of the decree sustaining the demurrer and dismissing the bill, is that on which the court below proceeded in rendering the decree, namely, that there is no case made by the allegations of the bill for the interference of equity, the remedy of the complainant on his contract of insurance being at law, so far as the situation is shown by those allegations.
    The complainant relies for reversal on the positions that equity has jurisdiction:

      First, Because of complex and intricate accounts, the data of which are exclusively within the possession and control of the defendant.

      Second, Because the amount sued for is recoverable from a particular fund, and equity can grant more adequate relief than a court of law;

      Third, Because a trust relation exists in this case between the complainant and the defendant Society.
    James Hamilton Lewis and Elijah H. Zoline, for plaintiff in error; Morris K. Levinson, of counsel.
    Mayer, Meyer, Austrian & Platt of Chicago and Alexander & Green of New York, for defendant in error.

      See Illinois Notes Digest, Vols. XI to XIV, samo topic and section number,

   Mr. Justice Brown

delivered the opinion of the court.

We have given very fully in the statement prefixed hereto the contentions of the complainant and the allegations of his bill, including its exhibits, on which those contentions rest. We have done this because the question involved is important and not free from difficulty and the necessarily limited discussion of it which we can give could hardly be well understood in all its bearings without reference to these contentions and allegations.

We do not think the statement in the “prospectus” or proposition put before the complainant as an inducement to him to take the policy is of importance. The policy is complete and speaks for itself. It is a written contract between the complainant and the defendant and it is especially provided therein that the application and the policy completely express the contract. Some emphasis, however, is placed by complainant on the fact that the “prospectus” signed by Rood, the general agent, declared that the “estimated cash value” of the proposed policy would be at the end of the Tontine period $10,430, and the estimated “surplus in cash” $5,982, a sum which added to the “Reserve” named, $4,076, would make an amount slightly less than this “estimated cash value.” But it is expressly stated in the same paper that “the calculations are simply estimates,” and that the exact amount of the surplus cannot be determined in advance. The language of the New York Court of Appeals in Avery v. Equitable Life Assur. Soc., 117 N. Y. 451, in this regard is not unreasonable in our opinion, nor does it differ from what we understand the law of Illinois to be. The Court says concerning this very class of policies:

“The assured was bound to know that the liability of the company on that plan of insurance was contingent upon several elements and indeterminable in advanee. * * * Their statements of what the assured might possibly gain under that plan do not amount to misrepresentation, and if the assured accepted the policy relying upon them and the result is not as supposed or estimated, that presents no ground for relief.”

The fact that in a case cited by plaintiff in error (Parke & Son Co. v. Thompson, 159 Ill. App. 187) involving an order for a certain number of barrels of cement, the word “estimated” was held by the Appellate Court of the Third District of this State to mean “about” or “approximately,” throws no light, in our opinion, on the obligation of the defendant in the case at bar, nor differentiates our law from that of New York.

But if the suggestion of the complainant as to the effect of the-expressions involving “estimates” were better founded, it would have no relevancy to the question which is actually before us. That question is not whether $7,324.80 is all that is due to complainant under the contract of insurance which he holds, but whether a suit on that contract is so cognizable in equity that a court of equity erred in refusing to entertain the bill in this case and thus relegating the complainant to a suit at law. We have no disposition to hold (indeed we do not think the question is before, us) that the holder of a Tontine policy in the Equitable Life Assurance Society or any other company is obliged, without remedy, to take whatever may be offered to him by the company or its directors, notwithstanding grounds of dissatisfaction he may conceive himself to have.

Nor do we think that the New York and Federal decisions involving the rights and obligations of the parties to this form of policy so hold. The importance of these decisions is respectively emphasized and minimized by the defendant and complainant herein, hut they do not deny recourse to the courts if a policy holder is dissatisfied with a settlement offered him, but deal with the two questions, First-. What must be considered a prima facie case of compliance by the company with its obligations, and of what nature and how definite must be the allegations and proof of the policy holder to overcome it? And, Second: Is it at common law or at equity that allegations like those in the particular cases decided should be adjudicated?

These two questions were somewhat intermingled in the cases and in the- opinions deciding them, and they were not free from difficulty. But we think they were decided correctly and we shall follow those decisions in the case at bar, as did the court below.

The most obvious, if not the most forceful, of the complainant’s arguments against the decision of the Superior Court to dismiss the bill is that a trust relation is made between him and the defendant by the very contract of insurance; that thereby the Equitable Life Assurance Society is made a trustee of complainant’s money. Of course, if this is so, a court of equity can and should supervise the execution of the trust when asked to do so by a bill which alleges its violation. But we cannot agree to the premise. The argument of the complainant would prove too much and its fault consists in using the word “trust” in a double sense. In the more general sense that the word may be used to declare that every borrower holds money lent to him in trust to use it for the purpose for which he declares to the lender that he wanted it, and to repay it when repayment becomes due, with whatever increment or 'intérést has been agreed on, the Equitable Life Assurance Society holds all its money received in premiums on all kinds of policies in trust; but that it does so in the sense in which the term must be used in courts of law and equity has been expressly negatived by the highest tribunal in the United States in Equitable Life Assur. Soc. v. Brown, 213 U. S. 25. “That there is such a trust in the fund mentioned has never been regarded as the law in the State of New York nor anywhere else, so far as any case has been cited on the subject,” is the language of Mr. Justice Peckham speaking for the court. “The fund mentioned” as the context shows, was the “so-called surplus,” “the moneys of defendant,” which had “reached the surplus fund.” The only difference between “the fund mentioned” in the Brown case and the fund which complainant herein declares to be a trust fund, is that the former included all “the surplus” of the company, that is, the aggregate of the surplus applicable to each class of policies, and the latter “the surplus or profits derived from policies of the class-to which the complainant’s policy belonged.” The whole includes each of its parts and the trust fund theory can no more properly be predicated of one of those parts than of the whole, in our opinion. That it may, however, is the alternative position of the complainant. That the Supreme Court of the United States does not assent to this alternative position is shown by its particular citation in the Brown case, of Uhlman v. New York Life Ins. Co., 109 N. Y. 421, wherein the Court of Appeals of New York held it untenable. The Supreme Court says:

“In the Uhlman case, supra, the plaintiff was the owner of a policy known as a ten year dividend system policy, otherwise a ‘tontine plan’ policy, which it was averred gave to the holder a special title to the funds derived from the payment of premiums on the policies of that kind and in the particular class to which the policy belonged. The Court of Appeals of New York held that such claim was not well founded, that it could not be said that the defendant is in any sense a trustee of any particular fund for the plaintiff or that it acts as to him and in relation to any such fund in a fiduciary capacity. It has been held that the owner of a policy of insurance even in a mutual company, was in no sense a partner of the corporation which issued the policy, and that the relation between the policy holder and the company was one of contract, measured by the terms of the policy. The holder of a policy of the nature of that referred to in the Ultiman case would be certainly as much entitled to claim that the company was a trustee for the holder as would be this complainant. Indeed the policy holder in the Ultiman case occupied a much stronger position for making the claim than does this complainant, who is the holder of an ordinary life policy with rights to participate in the distribution of the surplus according to methods, etc., adopted by the defendant, as already mentioned. The claim was, however, denied by the State Court, following the decisions of the New York Courts for many years. To hold that a trust is proved in this ease by virtue of the charter and policy of insurance, is to hold contrary to the decisions of the highest court of the State of New York for a long number of years past, without a single decision the other way in all that time.”

We should undoubtedly be inclined to follow the Supreme Court of the United States (in the absence of any decision to the contrary in the court of last resort in our own State on the question) even if it stood alone in its holding. It is, however, on the contrary, in accord with the holding of other courts of the United States of the State of New York and of other States in a long line of cases, for example, to cite only a few: Hunton v. Equitable Life Assur. Soc., 45 Fed. 661, first circuit, Colt, J. (a Tontine policy); Everson v. Equitable Life Assur. Co., 68 Fed. 258, third circuit, Buffington, J. (a Tontine policy); affirmed by the Circuit Court of Appeals of the third circuit, after a very full argument against the opinion of the court below, on the same lines taken by the counsel for complainant in the case at bar (18 C. C. A. 251, 71 Fed. 570); Uhlman v. New Yorh Life Ins. Co., 109 N. Y. 421, the N. Y. Court of Appeals (a Tontine policy); Watts v. Equitable Life Assur. Soc., 55 Misc. 454, the Supreme Court of N. Y. Special Term (a Tontine policy) ; Hackett v. Equitable Life Assur. Soc., 30 Mise. 523, the Supreme Court of New York Special Term (a Tontine policy); Pierce v. Equitable Life Assur. Soc., 145 Mass. 56, the Supreme Judicial Court of Mass, (a Tontine policy.)

It is true that this last case is much relied on by the plaintiff in error because in it the court sustained the jurisdiction of equity. But it did so upon another ground entirely, as we shall point out. As to the precise question we are now discussing, the language of the Court is:

“That the bill brought by the plaintiff cannot be maintained on the ground that he is the beneficiary of a trust fund held by the defendant, which is one of the grounds upon which an account is often ordered, and upon which theory the bill is based, is, we think, reasonably clear. * * *
We proceed to consider, therefore, whether, upon any other ground than that strictly of trust, the bill may be maintained for an account. ’ ’

The complainant maintains that the contrary is the law of Illinois, and directs our attention to a statement in the Encyclopedia of Pleading and Practice, that in Illinois the Supreme Court holds that the officers of a mutual insurance company are trustees of a Tontine fund, and that this doctrine would seem to include the right of the insured to compel them to account for its administration.

This statement of an encyclopedia is not an authoritative utterance any more than is the more definite statement that precedes it that “A suit in equity against a mutual insurance company is not maintainable on the theory of a trust relation between the company and its policy holders, ’ ’ and the only case which is cited to support the assertion concerning the holding of the Supreme Court of Illinois (Chicago Mut. Life Indemnity Ass’n v. Hunt, 127 Ill. 257) does not bear out the complainant’s contention. The question in that case was whether an information in chancery by the Attorney General of the State would lie, “to enforce a due administration of the trust reposed by the corporation in its officers ’ —manifestly a very different question from the one presented to us in the case at bar.

But largely on the authority of the Supreme Judicial Court in Massachusetts' in Pierce v. Equitable Life Assur. Soc., 145 Mass. 56 (from the‘opinion in which we have above quoted), the complainant insists that independently of the theory that the fund to be divided between the tontine policy holders is a trust fund, a court of equity should take jurisdiction because an accounting is necessary to secure an adequate remedy, and the accounts are alleged to be intricate and complicated, requiring the skill of expert accountants to audit the same.

Before discussing the law of Illinois in relation to the jurisdiction of equity, when such jurisdiction is asserted merely on the ground of the necessity of such an accounting, it may be well to note the factors which controlled the Massachusetts court in its decision and the extent to which the Federal and New York courts have differed from it. The Massachusetts statute, says the opinion, “gives jurisdiction in equity upon accounts when, the nature of the account is such that it cannot be conveniently and properly adjusted and settled in an action at law.’ ” The opinion then goes on to say that in the opinion of the court the accounts are so complicated that they cannot be conveniently investigated at common law.

This, in connection with the repudiation of the trust fund theory heretofore quoted, shows that the court places the decision upon the language of the Massachusetts statute, nothing similar to which exists in Illinois.

The opinion, it may be noted, also gives very considerable importance to the argumentum ab inconveniente urged by the Equitable Life Assurance Society, declaring that had the defendant objected originally to the entertainment of the ease by the Massachusetts court on the ground of “the great inconvenience involved in taking suck an account at a distance from the State in which its voluminous book and papers are properly kept, such objection would have been worthy of serious consideration.” Four years later in the Circuit Court of the United States in the District of Massachusetts, the same questions came up in Hunton v. Equitable Life Assur. Soc., 45 Fed. 661, in a suit removed to the Federal court from the State court.

The following excerpts from the opinion of Colt, J., will show the view taken by the Court: ‘ ‘ The question raised by this demurrer is whether a bill in equity will lie for an account against the defendant company for the amount due on a tontine policy, or whether the proper remedy is at law. * * * In this case the complainants being dissatisfied with the amount allowed by the defendant, have brought this bill in equity for an account, and the defendant has demurred, on three grounds: First, that the plaintiffs have not stated such a case as entitles them to any relief in equity against the defendant; second, that it does not appear that any fiduciary relation subsists between the plaintiffs and defendant, and that, therefore, their cause of action, if any, is cognizable in a court of common law; third, that the plaintiffs have not stated such a case as entitles them to demand in equity an account from the defendant.

If this bill can be maintained, it must be on the ground that a trust relationship existed between the parties, or that the account is of such a character that equity jurisdiction attaches. That no trust exists between the assured and the insurance company has been held in Pierce v. Society, 145 Mass. 56, and Bewley v. Society, 61 How. Pr. 344, and I agree with the reasoning of the court in those cases. I am also of opinion, upon the authority of Root v. Railway Company, 105 U. S. 189, that, this being merely a suit for an account, and it not appearing that any other ground of equitable jurisdiction exists, a bill in equity cannot, upon general principles governing the jurisdiction of courts of equity, be maintained. The plaintiffs rely, in this case, upon a provision of the Public Statutes of Massachusetts, * * * which confers equity jurisdiction in cases where ‘the nature of the account is such that it cannot be conveniently and properly adjusted and settled in an action at law.’ * _ * * It is well settled that the equitable jurisdiction of the United States courts cannot be changed by state statute. * * * Demurrer sustained.”

When Equitable Life Assur. Soc. v. Brown, supra, was heard and decided by the Supreme Court of the United States in 1909, Mr. Justice Holmes, who, as Judge of the Supreme Court of Massachusetts, had concurred in the opinion in Pierce v. Equitable Life Assur. Soc., supra, was a member of the Supreme Court of the United States and concurred in its opinion in the Brown case, supra. In that case the Court distinctly held a contrary doctrine as to the right of a policy holder to call upon the interposition of a court of equity to order an accounting, and quoted approvingly cases from the courts of New York which hold that under a policy like the present, “how much of the surplus shall be distributed to the policy holder and how much shall be held for the security of the defendant and its members, is to' be decided by the officers and management of the defendant in the exercise of their discretion to distribute, having in mind the present and future business, and in the absence of any allegations of wrongdoing or mistake by them, their determination must be treated as proper and their apportionment of the surplus is to be regarded prima facie as equitable.”

The New York courts seem uniformly to approve this same doctrine and the courts of Ontario in the Dominion of Canada also accede to it. Bain v. Aetna Ins. Co., 20 Ont. 6, 11, Canadian L. T. 273.

The theory concerning a life insurance company policy, whether tontine or otherwise, and whether issued by a mutual company or not, which is adopted by the courts of the greatest authority seems to be that the relation is not a trust but a contractual one, and that if the contract is alleged by the holder to be broken, the burden is on him to prove wherein and how.

The complainant insists, however, that even under this view a court in equity in Illinois should take jurisdiction of the case at bar, on the ground that the bill seeks a discovery and accounting in a matter involving complex and intricate accounts, and cites, as authority that this is the law of Illinois, various cases (Miller v. Russell, 224 Ill. 68, and others) which support the contention that a court of equity is justified in its discretion in taking jurisdiction where a complex and complicated account is involved, the right to take jurisdiction not depending in such case, it is said, on the entire absence of any remedy at law, but upon the inadequacy and impracticability of such remedy. But it is to be remembered that in the case at bar the question as it comes to its is not whether the court below in its discretion would have been justified in taking jurisdiction of this bill; it is, whether the court below in its discretion was justified in refusing to take jurisdiction and in relegating the complainant to his possible remedy at law.

That the court may act in taking or refusing jurisdiction in its discretion in such cases is certainly impliedly if not expressly the doctrine of Crown Coal & Tow Co. v. Thomas, 177 Ill. 534, and Miller v. Russell, supra.

That in cases like the one at bar seeking an accounting and discovery from an Insurance Company of practically innumerable items at a great distance from its headquarters, without specific or definite allegations of any instances or examples either of fraud or of inequitable distribution or disposition of the assets involved in the contract between the complainant and the Company, the argument from inconvenience against the interference of equity in the manner prayed, is, although not conclusive, nevertheless forceful and to be considered, many decided cases of high authority recognize; for examples: Equitable Life Assur. Soc. v. Brown, 213 U. S. 25, p. 212; Everson v. Equitable Life Assur. Co., 68 Fed. 258; Pierce v. Equitable Life Assur. Soc., 145 Mass. 56.

The bill is not strictly and merely a bill for discovery. It waives an answer under oath, which a bill “for discovery only” may not, under the chancery statute.

The statute concerning “Evidence” provides that in actions at law as well as in equity, upon motion and good and sufficient cause shown and reasonable notice thereof given, parties may be required to produce books or writings in their possession or power which contain evidence pertinent to the issue.

We do not think a case is made by the amended bill, which required the court below to take jurisdiction in equity of the charges of the complainant, or that it abused or exceeded its discretion in sustaining the demurrer and dismissing the bill. The decree is therefore affirmed.

Affirmed.


source: Caselaw Access Project

license: Public Domain

text:
    City of Chicago, Defendant in Error, v. Edward Meyers, Plaintiff in Error.
    Gen. No. 18,258.
    1. Municipal Court of Chicago, § 39

      —presumption on review when evidence not preserved in record. Where the evidence is not preserved in the record it will he presumed that it showed the defendant guilty of the matters, or some one of them mentioned in the complaint.
    2. Municipal Court of Chicago, § 39

      —when want of appearance by prosecution not preserved on review. Objection that there was no appearance by the City of Chicago to prosecute cannot be raised where there is nothing in the record to show that the city did not appear to prosecute, and the officer who made the complaint was in a sense the agent of the City.
    3. Criminal law, § 461

      —conclusiveness of record. Assignment of error that the complaint was subscribed and sworn to “after judgment” cannot be considered where the contrary appears from the record.
    4. Criminal law, § 391

      —when order of commitment not invalidated by order for an execution. Fact" that an execution was ordered for the fine, does not render an order of commitment to work it out in the house of correction illegal.
    Error to the Municipal Court of Chicago; the Hon. John R Caverly, Judge, presiding. Heard in this court at the March term, 1912.
    Affirmed.
    Opinion filed November 24, 1913.
    Charles E. Erbstein, for plaintiff in error.
    William H. Sexton and James S. McInerney, for defendant in error; Edwin J. Raber, of counsel.

      See Illinois Notes Digest, Vols. XI to XIV, same topic and section number.

      See Illinois Notes Digest, Vols. XI to XIV, same topic and section number.

   Mr. Justice Brown

delivered the opinion of the court.

The record in this case shows that the plaintiff in error was arrested and brought into the Municipal Court by a police officer of the City of Chicago; that. the Municipal Court thereupon took jurisdiction of his person; that the police officer received leave to file a complaint against him and did so, under oath; that the plaintiff in error then being advised by the court as to his right to a trial by jury, elected to waive a jury and executed a waiver in writing in the cause, which was entitled “City of Chicago vs. Edward Meyers

The complaint stated that the officer making it was a police officer of the City of Chicago, and that he saw the plaintiff in error in the act of committing various offenses against good order (which are included in a printed blank) “in violation of Section 2012 of the Chicago Code of 1911.” The offenses charged are all those included in said section and called therein generally “disorderly conduct.”

The complaint also states that so seeing him, the complaining officer took the plaintiff in error “without delay before the Municipal Court of Chicago.”

It does not appear that the defendant made any demand for a more specific bill of particulars. If he had done so he would have been entitled to a more specific statement of what he was accused of. City of Chicago v. Williams, 254 Ill. 360. The court found him guilty and the evidence is not preserved in the record. It must be presumed, therefore, that it showed him guilty of the matters, or some one of them, mentioned in the complaint, and declared “disorderly conduct” in the section of the City Code in question. The plaintiff in error was after being thus found guilty fined by the court $200 and costs, the judgment being that “the City of Chicago have and recover from the defendant a fine in the sum of $200, etc., and that execution issue therefor, ’ ’ and also that ‘ default having been made in the payment of said monies,” etc., he be committed to the House of Correction until the fine and costs shall be worked out at the rate of fifty cents per day, etc., or until the whole of said fine and costs shall have been paid, or until said defendant shall have been discharged according to law.

There is nothing irregular in this procedure. Counsel for plaintiff in error says in his brief that the complaint was subscribed and sworn to “after judgment.” This is not shown by the record, but the contrary appears. The complaint and judgment were the same day, but the record shows the filing of the complaint was first. The procedure of bringing the defendant into court was in accordance with clause IV of section 49 of the Municipal Court Act, said clause having been added to that act by the Amendatory Act of June 3, 1907.

The counsel for defendant also insists that there was no appearance by the City of Chicago to prosecute. There is nothing to show the City did not appear and prosecute. The officer who made the complaint was in a sense the agent of the City. At all events, for all that the record shows, the whole law department of the City may have been present. The proceedings in the absence of any showing to the contrary are in this particular presumed to be regular. Nor is there any merit in the contention that because an execution was ordered for the fine, the commitment to work it out under the Act approved April 12, 1879, providing for the punishment for violation of municipal ordinances was illegal or vice versa, that the order for the execution was illegal because of the commitment. When the fine is paid in any manner the imprisonment would end, and whatever is earned under the statute by labor in the House of Correction would be credited on the execution.

The judgment of the Municipal Court is affirmed.

Affirmed.


text:
    Nathan Kanter, Defendant in Error, v. Abraham Finkelstein, Plaintiff in Error.
    Gen. No. 18,270.
    (Not to be reported in full.)
    Error to the Municipal Court of Chicago; the Hon. John R. Newcomer, Judge, presiding. Heard in this court at the March term, 1912.
    Affirmed.
    Opinion filed November 24, 1913.
    Statement of the Case.
    Action by Nathan Kanter against Abraham Finklestein to recover for goods sold and delivered. From a judgment for plaintiff for $448.52, defendant brings error.

      Abstract of the Decision.
    Appeal and error, § 1749

      —affirmance in absence of error. Where the only question in an action for goods sold and delivered is one of fact, a judgment will he affirmed where no error appears.
    B. M. Shaffner, for plaintiff in error.
    No appearance for defendant in error.

      See Illinois Notes Digest, Vols. XI to XIV, same topic and section number.

   Mr. Justice Brown

delivered the opinion of the court.


text:
    A. R. Fifer, Defendant in Error, v. Hyman Lewis and Louis Redman, Plaintiffs in Error.
    Gen. No. 18,289.
    (Not to be reported in full.)
    Error to the Municipal Court of Chicago; the Hon. John R. Newcomer, Judge, presiding. Heard in this court at the March term, 1912.
    Affirmed.
    Opinion filed November 24, 1913.
    Statement of the Case.
    Action by A. R. Fifer, trading as A. R. Fifer & Company, against Hyman Lewis and Louis Redman, to recover broker’s» commissions on the sale of property. From a judgment of three hundred dollars and costs, defendants bring error.
    William Reeda and Samuel Micon, for plaintiffs in error.
    Max M. Grossman, for defendant in error.

      See Illinois Notos Digest, Vols. XI to XIV, samo topic and section number.

   Mr. Justice Brown

delivered the opinion of the court.

Abstract of the Decision.

Brokers, § 48 —when principal effecting sale is liable for commissions. A broker secured a purchaser and the owner not agreeing to the purchase price in the contract of sale prepared by the broker refused to sign the contract and terminated the negotiations. The owner subsequently sought out the purchaser and made a similar contract with him in a third person’s name, providing for the repudiated purchase price. The third person then assigned the contract to the purchaser. Held, the owner was liable to his broker for commissions.


text:
    The People of the State of Illinois, Defendant in Error, v. Leon A. Berezniak, Plaintiff in Error.
    Gen. No. 18,304.
    Contempt, § 17*—-when unlicensed attorney not guilty of. A contempt order reciting that the defendant was in open court and acted before the court as a properly admitted and licensed attorney and participated in the trial of a cause as such an attorney where in truth he was not a party to the cause nor a properly admitted and licensed attorney, without a showing in what way defendant’s conduct “tended to impede and interrupt the proceedings and lessen the dignity of the court,” does not show any authority for committing defendant for a contempt of court.
    Error to the Municipal Court of Chicago; the Hon. Fred C. Hill, Judge, presiding. Heard in this court at the March term, 1912.
    Reversed.
    Opinion filed November 24, 1913.
    Harry M. Fisher, for plaintiff in error.
    Maclay Hoyne, for defendant in error.
   Mr. Justice Brown

delivered the opinion of the court.

This is a writ of error to reverse an order of the Municipal Court entered by one of the judges holding said court on February 8, 1912, committing the plaintiff in error to jail for five days for an alleged contempt of court committed in the presence of the judge. The only record in the case consists of the order itself, which recites that the defendant, Leon A. Berezniak, was present on February 8, 1912, in open court, and while the court was in open session appeared and acted before the court as an attorney at law, properly admitted and licensed by the Supreme Court under the laws of this State, and thereby entitled to practice as such in the court, and participated as such alleged attorney at law in the trial of the case of the Inter Ocean Newspaper Company v. Frank J. Hanscom, when in truth he wa¡e not a party to said cause nor an attorney admitted and licensed under the laws of the State and was not then and there entitled in any manner to appear and act in the court as such attorney. “Which conduct of said defendant tended to impede and interrupt the proceedings and lessen the dignity of the court,” says the order.

Just how or why it so tended we are not informed, as no argument has been made in this court for the People.

Certainly no sufficient record is here to show any authority for this commitment. The defendant may have been admitted to practice in a neighboring State and relying on a well known custom of our courts have supposed the courtesy of being allowed to appear would be accorded him. He may have been the agent of the corporation which was a party to the suit. It doesn’t appear how he “participated” in the trial. Perhaps he was taken by surprise by the accidental absence of the lawyer for the corporation and acted as a locum tenens while waiting for him.

Many things might be imagined which would leave the findings of the court true, and yet negative any intention on the part of the plaintiff in error “to impede and interrupt the proceedings and lessen the dignity of the court.”

We can hardly suppose that under such cireumstances a judge would have sent him for five days to tho county jail, but as those may have been the facts as far as appear, the order is reversed.

Reversed.


author: Mb. Justice Brown

text:
    The Bartholomae & Roesing Brewing & Malting Company, Appellee, v. Helen Modzelewski and Brun Modzelewski, Appellants.
    Gen. No. 19,748.
    1. Injunction, § 67

      —when negative covenants will not he enforced. In the absence of special circumstances, a contract which equity will not interfere directly to enforce by a decree for specific performance, it will not interfere -to enforce by the coercion of an injunction against its violation.
    2. Injunction, § 75

      —enumeration of cases of enforcement of negative covenants. Where the remedy at law for a breach of a contract is plainly inadequate because the defendant is an assignee or is insolvent, or where there are personal services involved which are unprocurable from persons other than the defendant, or where, after a sale of business good-will, a valid negative covenant in restraint of trade can be specifically enforced by injunction and the damages are presumed irreparable and unascertainable, or where the covenant is one connected with the conveyance in fee, for life or for years, of real estate, express negative covenants may be enforced.
    3. Injunction, § 75

      —when negative covenant not enforced. A violation of an express covenant in contract between a saloon keeper and a brewery not to purchase any beer from any other party than the brewery will not be prohibited by an injunction where the contract further provides for liquidated damages in case default shall be made in its observance.
    Appeal from the Superior Court of Cook County; the Hon. Michael L. McKinley, Judge, presiding. Heard in this court at the March term, 1912.
    Reversed.
    Opinion filed November 24, 1913.
    Rehearing denied and opinion modified and refiled December 8, 1913.
    Statement by the Court. This is an appeal under section 123 of the Practice Act, allowing appeals from an interlocutory order or decree granting an injunction or overruling a motion to dissolve the same or enlarging the scope of an injunction order.
    The order appealed from was one overruling a motion to dissolve a preliminary or pendente lite injunction of the Superior Court of Cook county. It was entered on July 7,1903. The preliminary injunction had been obtained on June 6, 1913, on the face of a bill in equity theretofore filed and the report of a master before whom both parties bad appeared and argued their respective contentions.
    The defendants on June 10, 1913, filed an answer to the bill, and afterwards made a motion to dissolve the injunction, presenting in support of the same various affidavits preserved in the record. Complainants presented affidavits in opposition to said motion. On its denial the defendants perfected an appeal to this court, assigning as error both the entry of the order granting the injunction and the denial of the motion to dissolve the same.
    The bill in the cause alleges that the complainant, Bartholomae & Roesing Brewing and Malting Company, is a brewing company manufacturing and selling beer; that the defendants, Helen Modzelewski and Brun Modzelewski, have been since May 1, 1912, owners of the premises at No. 5426 Justine street in Chicago; that on May 1, 1912, the complainant and defendants entered into a written agreement whereby the defendants agreed to conduct a saloon business continuously and exclusively upon the first floor of 4526 Justine street from May 1, 1912, up to April 30, 1917, and that during all said period they would purchase from the complainant and no other person, firm or corporation whatsoever all of the draught beer sold, used, consumed or given away by them in and about said saloon premises, for which said beer the defendants agreed to pay at the market price thereof in the city of Chicago, and further agreed “that during said period of time they would not purchase any draught beer for sale, use or consumption on said premises from any other person, firm or corporation than the party of the first part;” that the complainants agreed to sell and deliver to the defendants for the period of time mentioned and at the prices in said agreement mentioned (i. e. the market prices of said complainant’s beers in the city of Chicago), and further agreed to loan said defendants as an additional consideration for the said covenants by them to be performed a first-class set of saloon fixtures and furniture for use by them in said premises, free from all charge and expense; that in pursuance of said agreement the complainant installed a set of saloon fixtures and appliances and said defendants began and continued to conduct a saloon business in the said premises, purchasing their draught beer from the complainant in accordance with the prices specified in said agreement until May 2, 1913, when the said defendants, without the complainant’s fault, refused to purchase further draught beer for sale or consumption in said premises from the complainant, or otherwise perform the covenants in said agreement contained and removed all of the saloon furniture and fixtures of the complainant from said premises; that since said date the defendants have purchased the draught beer sold by them in said premises from the Mullen Brewing Company, and have represented to the complainant that they will continue so to do and no longer purchase draught beer from the complainant; that the complainant has fully performed all the terms and conditions of the said agreement by it to be performed, and is ready and willing to do so in the future; that it has no adequate remedy at law for the breach of said agreement “by reason of the fact ’that the damages which will be sustained by the complainant by reason of the continued refusal of the said defendants to carry out and perform the terms of said agreement cannot be ascertained and that it will be irreparably injured unless the court intervene by injunction to prevent the further violation of said agreement by the defendants.
    The bill prays that on final hearing “said defendants be decreed not to purchase for sale or consumption in the said premises any draught beer from any other person, firm or corporation than the complainant up to and including April 30, 1917, and not to sell or permit to be sold on the premises described any draught beer other than that manufactured by complainant up to and including April 30, 1917,” and “that said defendants be restrained and enjoined from either directly or indirectly' purchasing for sale or consumption in said premises or selling or permitting to be sold in said premises any draught beer other than that manufactured by complainant and from in any manner either directly or indirectly violating said negative covenant in the contract” and that an injunction pendente lite issue to the same effect.
    The contract in question was appended to the bill as an exhibit and made a part thereof. Besides the provisions which are set out in the bill as above abstracted it contains the following clauses:
    “4. The said parties of the second part” (the defendants) “agree to use continuously and exclusively in the conduct of said saloon business the bottled beers as manufactured and sold by the party of the first part, the United States Brewing Company of Chicago and the Yal Blatz Brewing Company and will pay therefor in cash upon delivery the market price of said bottled beers in Chicago excepting such bottle beers that are specifically asked for by their patrons.
    6. The parties of the second part expressly agree that they will not permit a dramshop to be conducted on any of the properties on Justine street between 45th and 46th streets in which they have any interest of whatsoever kind and nature during the term hereof than at the premises hereinabove mentioned.
    7. The party of the first part expressly agrees that so long as the parties of the second part shall have faithfully complied with all the covenants in this contract contained by them to be kept and performed, it will allow the said parties of the second part the sum of $25 per month to be applied on beer purchased during the preceding, month.
    8. It is further agreed and understood by and between the parties hereto that if the parties of the second part shall at any time during the term of this contract make default herein, or fail to keep and live up to all of the covenants and agreements herein set forth to be kept and performed by them, or shall fail to purchase until the expiration hereof all the draught beer of the party of the first part and the bottled beer and pay therefor as herein provided, then and in that event they shall pay to the party of the first part as liquidated damages the sum of $50.00 per month for each and every month and fraction of a month covering the unexpired term, viz: from the date of such default to and including April 30, 1917. The parties of the second part agree to pay such liquidated damages to the party of the first part upon demand and upon the failure of the parties of the second part to pay such liquidated damages to the party of the first part, the party of the first part shall have the right to use any and ail necessary and proper means to enforce the payment of the same. * * *
    9. It is further understood and agreed by and between the parties hereto that the neglect or failure of the party of the first part to enforce rights or declare forfeiture for a breach by the parties of the second part of one or more covenants in this contract contained, shall not be deemed or construed as a waiver on its part to enforce rights or declare or enforce forfeitures in case of a breach of other or similar or different covenants in this contract contained.
    This agreement shall extend to and be binding upon the successors and assigns of the party of the first part, and upon the heirs, administrators, executors, successors and assigns of the parties of the second part.”
    The cause having been referred to a master upon the question of an issuance of an injunction pendente lite, and he having reported in favor of such issuance, the defendants and their agents were enjoined in the first instance:
    “From either directly or indirectly using or suffering or permitting to be used on the premises described in said bill of complaint herein (being the premises occupied by the said defendants as a saloon and dram-shop and known as number 4526 Justine street, Chicago, Illinois) any domestic draught beer other than that manufactured and sold by the Bartholomae & Roesing Brewing & Malting Company;” and also “From directly or indirectly buying, taking or selling on said premises any draught beer whatsoever manufactured or sold by any other brewing company than the complainant.-’ ’
    Contemporaneously with the filing of an answer by the defendants the injunction order was modified to read:
    “The court doth therefore order, adjudge and decree that said defendants * * * be and they are hereby restrained and enjoined from either directly or indirectly purchasing any draught beer for sale, use or consumption on the premises described in said bill of complaint * * * from any other person, firm or corporation than the said Bartholomae & Roesing Brewing and Malting Company.”
    It was in this form when the motion was made to dissolve it.
    The answer, which had been filed meanwhile, was sworn to and used as an affidavit on behalf of the defendants on the hearing of said motion. The answer asserts that contemporaneously with the agreement set forth in the bill, and as a part thereof, the complainant executed another agreement, to allow the defendants 4% barrels of beer on each monthly sales of beer of the complainant to May, 1913, if the sales of beer of said Company averaged the same as for May and July, 1.912, and subsequently orally agreed, through its manager, that said allowance of beer to May, 1913, would be at the rate of 4y2 barrels of beer for each 73% barrels of the complainant’s beer bought by the defendants from the complainant from August, 1912, to April, 1913, inclusive, 73% barrels being the average sale of complainant’s beer to defendants for the months of May and July, 1912.
    The answer admits the allegations of the bill as to the refusal on or about May 2, 1913, and subsequently to purchase draught beer from the complainant, but charges that the said actions by defendants were caused by various breaches of the contract by complainant prior to May 2, 1913. It denies the absence of any adequate remedy at law to the complainant, and insists that the damages in case of breach are liquidated in the agreement. It also alleges that the complainant has not paid the defendants the sum of $25 per month for the months of February, March or April, 1913, although said money was due from the complainant to the defendants and although prior to the purchase of beer by them from any one other than the complainant, they had demanded it for the month of February and for the month of March, 1913, and stated to complainant that unless the complainant would make such payments to them they would regard their agreement as cancelled and buy their beer elsewhere.
    The answer also alleges that from August, 1912, to April, 1913, the defendants bought from the complainants 493% barrels of beer, and under the agreement were entitled to 26% barrels of beer, but had only furnished them four barrels and had refused to furnish any more before they, the defendants, bought beer from anyone else, and that it was only after said breaches of the agreement by the complainant the defendants removed the fixtures of the complainant from the saloon and notified the complainant to come and get them, which the complainant did on May 6, 1913.
    Besides the answer thus used as an affidavit, the defendants presented various other affidavits in support of the motion to dissolve. One made -by Brun Modzelewski, one of the defendants, alleged that op. or about April 15, 1913, lie made a demand on Mr. Seitz, the manager of the complainant, for $50 due under the contract for the months of February and March, 1913, and that the manager refused to give it to him and told him to get the $500 necessary to pay for a license for the period beginning May 1,1913; that on April 17 and on April 21 and on April 25 he had interviews at the office of the complainant with Mr. Clark, the assistant manager of the complainant (Mr. Seitz being absent each time), and that at each interview the affiant demanded $50 and it was refused by Mr. Clark, who at the last interview said, “We won’t pay you; get $500 for the license and that’s all; don’t come around any more,” to which affiant replied, “If you don’t pay me I won’t take beer from you.” Clark said, “We don’t care for that place—you do as you please.”
    An affidavit of one Zawora, who swears he was present at the interview between Modzelewski and Clark on April 21, corroborates the former as to what happened at that interview; and one Max Ehrman in an affidavit alleges that he was present at the interview of Clark and Modzelewski on April 25, 1913, and gives substantially the same account of it as Modzelewski. He says that Modzelewski told Clark at that interview, “If you don’t keep up your contract we are going to take beer somewhere else,” and that Mr. Clark refused to pay anything to defendants unless the defendants would pay $500 on account of the license fee to become due. According to this affidavit Modzelewski also told Clark there was beer due to the defendants from the complainant. William English also made affidavit showing that on May 7, 1913, as attorney for the defendants, he demanded of the complainant by letter $25 for the month of February, 1913, $25 for the month of March, 1913, and $25 for the month of April, 1913, and also $102 on account of an alleged agreement to allow the defendants from August 1,1912, four barrels of beer free for every 73% barrels bought by them, to which letter no answer was received. Englisk also made two other affidavits, one to the effect that at an interview which as attorney for defendants he had with Mr. Seitz during the latter part of March or early in April, 1913, Seitz told him that “although the defendants had not made monthly purchases of beer from the complainant of the same average as their purchases for the months of May and July, 1912, nevertheless the complainant would allow the defendants and furnish them free of charge four barrels of beer for as many times as the average of defendants’ purchases of beer from complainant for the months of May and July, 1913, was contained in the total purchases of beer by defendants from the -complainant from August, 1912, to April, 1913, inclusive. (The number of barrels thus purchased was stated in the letter of English as 493%, for which four free barrels only had been received.)
    Another affidavit of English alleges advice on his part to defendants that they could not compel the complainants to allow the defendants the free barrels of beer, but that the defendants could compel the complainant to pay the defendants the $25 a month from February and March which was unpaid, and that if complainants did not pay said money to defendants on demand, complainant would be breaking its contract and defendants would not have to carry out their contract.
    The complainant presented on the hearing of the motion to dissolve; the affidavits of John F. Seitz, Frederick G-. Clark, Philip Beisz and Frederick Pietsch.
    Seitz swore in effect that the promised allowance of beer was not a part of the agreement of May 1, 1912, that there was never a promise by the complainant to make any such allowance to defendants unless their sales averaged the same as May and July, 1912, and that they never did; that the credit of $25 a month was always shown on the books of the Company; that up to and including January, 1913, said allowance was applied to license fees advanced by the complainant for the defendants, at their request; that the allowance of $25 a month for September, October, November and December, 1912, and January, 1913, were receipted for by the defendants by Max Ehrman (the affiant, for the defendants) and applied at their request to the license account; that the defendants did not, April 15, 1913, or at any other time, request the affiant to pay them $50 in cash for February and March, 1913, nor did the complainant refuse any such request, but that it was thoroughly understood the defendants were entitled to a credit for it either on the purchase of beer or any other account with the complainant; that all the conversations between the defendant B. Modzelewski or his attorney and the affiant were with reference to the allowances of beer.
    Clark swore that the conversations in April, 1913, between B. Modzelewski and himself were all about the claim for an allowance of free beer and “that at no time did the defendant B. Modzelewski ask for an allowance of $50 for the months of February and March, 1913, nor did the said affiant or anyone in his presence at any time refuse to give the said allowance, but told the said defendant that he was entitled to an allowance of $25 per month according to the contract and no more, and that the same would be allowed to him on any account that he wanted it.”
    The affidavit of Clark also specifically denies the material assertions in the affidavit of Ehrman.
    Beisz made affidavit that on or about April 25, 1913, when Modzelewski and Ehrman called at the office of the complainant, Clark brought them into the office of the affiant, who was an employe of said complainant, and that Clark, Ehrman and Modzelewski talked for some time in his presence, but at no time did Ehrman or Modzelewski demand payment of any part of the $25 a month allowance, but that Modzelewski said that unless the Brewery would allow him the four barrels of beer per month that he claimed he would throw out their fixtures and take other beer.

      The affidavit of Pietsch, who is the head bookkeeper of the complainant, states that the books of the complainant show a credit to the account of the defendants of $25 for February, March and April, 1913; that on April 25, 1913, affiant told Ehrman in the presence of Modzelewski that the defendants had $50 coming for the months of February and March, 1913, in accordance with the contract, and were not entitled to any other allowance, and that neither said Ehrman nor Modzelewski asked affiant or anyone else in the presence of affiant for the said sum of $50.
    “Affiant further says that at no time to the knowledge of affiant was any demand made for the said sum of $50, nor did the defendant or any one in his behalf request the application of said allowance for any,particular purpose without such application being made in accordance with the defendant’s request.”
    The certificate of evidence further shows that on the argument of the motion to dissolve, the counsel for the complainant stated in substance to the court and to defendants ’ counsel that complainant had always been willing to make the allowance of $75 and had since offered this money to the solicitor for defendants, and that defendants ’ solicitor had replied in substance that he would accept the $75 on condition that he be allowed to do so without prejudice to any rights which the defendants might have, to which the counsel for complainant had answered that he was not prepared to pay the money under such conditions.
    James P. Harrold, for appellants.
    Winston, Payne, Strawn & Shaw, for appellee; John C. Slade, of counsel.

      See Illinois Notes Digest, Vols. XI to XIV, same topic and section number.

   Mb. Justice Brown

delivered the opinion of the court.

If our disposition of this appeal rested upon the contested matter brought into the case on the motion to dissolve the injunction, namely, whether the complainant had been shown to have been gnilty of a breach of the contract of May 1, 1912, prior to May 2, 1913, when it is admitted the defendants broke it and refused to purchase further beer from the complainant, we should have no hesitation in affirming, on the ground that at least this question was left so much in doubt by the affidavits and counter-affidavits, that the decision of the chancellor as to the continuance as well as to the allowance of the injunction was correct, and that until a full and fair hearing of the case on proofs other than affidavits could be had, the preliminary injunction ought to stand.

But our view of the matter is one that differs from that of the master, who recommended the injunction and whose report is found in the record, from that of the chancellor below, who granted it, and from that of the counsel for the complainants, who have ably and elaborately argued in its support on this appeal. It involves the fundamental and important question whether the express negative covenant in the contract in this case should be enforced by an injunction. This question is not complicated in this case with any of the various additional elements or collateral factors, some one at least of which has usually been present where equity has intervened in this manner to prevent the breaking of a contract. Indeed the negative answer which we think it necessary to make receives support by considerations additional to the general one we deem to be the law in the absence of special circumstances, namely, that a contract which equity will not interfere directly to enforce by a decree for specific performance, it will not interfere to enforce by the coercion of an injunction against its violation. Welty v. Jacobs, 171 Ill. 624.

The express negative covenant is that defendants during a prescribed time “will not purchase any draught beer for sale, use or consumption on said premises from any other person, firm or corporation than the party of the first part.”

The additional considerations which we have noted are that there is in the contract an express stipulation for damages liquidated at a certain amount in case default shall be made in its observance, and that an injunction against the breach of the negative covenant would afford, as we said in a somewhat analogous case (Bour v. Illinois Cent. R. Co., 176 Ill. App. 185) “no damages or compensation at all” (for the breach), “but only a morally coercive pressure which may lead to juster dealing.”

Counsel for complainant, however, make first the distinction (which whether material or not is obvious) between cases like the Bour case of implied negative covenants and express negative covenants, and rest their case chiefly on the position thus expressed in their brief:

* ‘ Where a bill seeks by injunction to restrain the violation of an express negative covenant it is not necessary to the relief sought that the complainant have no adequate remedy at law. Nor is the right to such injection affected by the fact that the contract contains a provision for liquidated damages

To this proposition they cite many cases. But of these citations those which are really of authority for us, cases in the Supreme Court of this State, are comparatively few, and we think may be distinguished from the case at bar by facts to which the language used must be applied.

"Where the remedy at law for a breach of a contract is plainly inadequate because of the insolvency of the defendant or because no suit at - law could be maintained against the defaulting party because he is but an assignee of the contract, where such a remedy is inadequate or impossible because there are personal services involved which are unprocurable from persons other than the defendant, and are therefore incommensurable in money damages; or where, after a sale of business good-will a valid negative covenant in restraint of trade can be specifically enforced by an injunction and the damages are presumed to be irreparable and practically nnascertainable; or where the covenant broken is one connected with the conveyance in fee, for life or for years, of real estate, which is a peculiar kind of property affected by particular doctrines of the law, there is no doubt that express negative covenants have been enforced by injunction in Illinois as in other States and in Great Britain.

The case of Southern Fire Brick & Clay Co. v. Garden City Sand Co., 223 Ill. 616, strongly relied on by complainant, actually falls within the class where, as the Court says in its opinion, the complainant could not maintain an action at law against the defendant because it was not a party to the original contract, and the Court in a portion of its opinion not only notes but places the decision upon this ground.

The case of Lumley v. Wagner, 1 De Gex, McN. & G. 604, and many cases which have followed it in this country, fall within the class where the damages are incommensurable with money values because the contract is for services that are unique.

As often as this case has been followed, however, it has not, as Mr. Justice Ball in this court noted in Rabinovich v. Reith, 120 Ill. App. 409, escaped criticism; e. g. in Whitewood v. Hardman, L. R. 2 Ch. Div. 42S. Limited, however, to the class of cases within which Lumley v. Wagner and Montague v. Flockton, L. R. 16 Eq. 189, fall, the doctrine may be considered established.

The line of cases in Great Britain known as the “Tied House Gases” begins more than a hundred years ago. In 1792 a covenant in an assignment of a lease to take beer from a particular brewery was under discussion (Hartley v. Pehall, 1 Peake N. P. 178) and in Holcombe v. Hewson, 2 Campbell 391 (1810) and Cooper v. Twihill (1808), reported in a note to Jones v. Edney, 3 Campbell 285, Lord Ellenborough tried in an assumpsit suit and in a replevin suit,, questions arising from the breach of such covenants in leases. He took occasion to say in the last case that “The whole of these leases by which the people of the description of the plaintiff are prevented from having the article they deal in from those who will serve them best are extremely injurious to the public interest and welfare, ’ ’ and that he hoped it was the last time he should see such a provision in any lease. But his hope was certainly not fulfilled nor his opinion received with favor, for in 1869 Lord Justice Selwyn in the Court of Appeals in Chancery, rendering the judgment in Catt v. Tourle, L. R. 4 Ch. App. 654, said: “With respect to this particular covenant, it seems to me that the court cannot but take judicial notice of its being extremely common. Every court of justice has had occasion to consider these brewers covenants and must be taken to be cognizant of the distinction between what are called free public houses and brewers public houses, which are subject to this very covenant. We should be introducing very great uncertainty and confusion to a very large and important trade if we were now to suggest any doubt as to the validity of a covenant so extremely common as this is.”

The case was a bill in .equity for an injunction to restrain a defendant who had with notice acquired the land, from persons who had taken a deed from the plaintiff with an affirmative covenant therein for his benefit that all beer consumed thereon should be bought from him. The right in a court of equity to an injunction was sustained on a demurrer to the bill, and the case is cited in some of the cases relied on by the complainant and may be considered a strong authority in favor of the jurisdiction of equity in England in like cases to enforce such a covenant.

The Supreme Judicial Court of Massachusetts in Butterick Pub. Co. v. Fisher, 203 Mass. 122, speaks of the covenant in Catt v. Tourle, supra, as in a lease, but says that makes no difference in principle. The covenant was not in a lease, but in a deed of the fee, practically, however, the same thing, but we think the language and reasoning of the Lord Justices Selwyn and Griff ard hardly bear out the inference that the fact that the covenant was connected with the conveyance made no difference to the decision. Lord Justice Selwyn quotes approvingly from other cases as a basis of his opinion: “That the question does not depend upon whether the covenant runs with the land is evident from this, that if there was a mere agreement and no covenant this court would enforce it against a party purchasing with notice of it, for if an equity is attached to the property by the owner no one purchasing with notice of that equity can stand in a different position from the party from whom he purchased.”

And: “Reason and justice seem to prescribe that at least as a general rule where a man by gift or purchase acquires property from another with knowledge of a previous contract lawfully and for valuable consideration made by him with a third person to use and employ the property for a particular purpose in a specitied manner, the acquirer shall not to the material damage of the third person in opposition to the contract and inconsistently with it, use and employ the property in a manner not allowable to the giver and seller. ’ ’

Lord Justice Griff ard put his opinion on the ground that “One thing at least is certain, viz.: that if the plaintiff cannot sustain a bill in this court, he is without remedy altogether, it being plain that this is a covenant which does not run with the land. ’ ’

Catt v. Tourle, supra, therefore falls within the class where covenants of this kind, express and implied, have been enforced when connected with the conveyance and use of real property and also within the class where the contract was unenforceable at law against the person sought to be coerced.

Lukes v. Dennis, L. R. 7 Ch. Div. 227 (1877-1878), also is a case where a covenant was contained in a lease, although not the lease of the particular property where the violation of the covenant was involved. The same covenant was, however, contained in a mortgage assignment of the second lease to the brewers. An injunction (although not granted because of a compromise) was held by the court proper under condition that the brewer performed the implied agreement on his part. The defendant was, however, not the original covenanter, but his assignee with notice.

Clegg v. Hands, L. B. 44 Ch. Div. 503 (1889) is a leading case, giving fully the reasoning of the Vice Chancellor of the County Palatine Court of Lancaster and of the Lords Justices of the Court of Appeal on covenants tying public houses to brewers and the right to enjoin on a negative covenant like-the one at bar when they occur in leases, but in that case the respective judges held that the covenant in question was a covenant relating to the way in which the business at a particular house was to be carried on, and accordingly a covenant running with the land. Also that whether it rah with the land or not it was enforceable in equity in favor of the assignee of the reversion, on the ground that the defendant having presumably obtained a lease of the house at a lower rent by reason of the restrictive covenant ought to be restrained from dealing with the house in a way inconsistent with the covenant.

These cases and many others in Great Britain recognizing in the given cases the validity of a negative “tied-house” covenant, express or implied, and the jurisdiction of equity to enforce it, however.they may reinforce the complainant’s argument would not seem to us, even if they were binding authority, to go to the extent of rendering it conclusive. There is no case that we can find in which the use of an injunction to enforce a negative contract for thus “tying” a public house to the manufacturer, unconnected with the conveyance of land, and where the controversy was between the original parties to the contract (to say nothing of the provision for liquidated damages) has been sustained, nor even one in which it seems to have been asked.

If the contention of the complainant is correct in its full extent, nothing more is necessary to turn over to courts of equity and to their summary processes for the enforcement of their orders, the practical supervision of the specific performance of any personal contract for the future purchase or sale of commodities or the rendition of services in the future, than to add to the affirmative agreement a supplementary negative one that the intending purchaser will not buy the commodity from, or the intending employe will not perform the service for, any other person than the contraetee.

We understand the general rule to be very distinctly against this theory, and that it would be inconsistent with the whole spirit of our jurisprudence. The reasoning of the Supreme Court of Michigan in Hardy v. Allegan Circuit Judge, 147 Mich. 594, seems to us sound on this subject.

We are not convinced that the Supreme Court of Illinois are committed by the general language of Mr. Justice Wilkin in Southern Fire Brick & Clay Co. v. Garden City Sand Co., supra, to the doctrine, insisted on by complainant for the decision is distinctly put on the fact that no action could be maintained at law in that case for an unjustifiable breach of faith. For such a breach of faith in the case at bar, if it exists, the remedy at law is open and distinctly provided for.

Nor do we think any other opinion of the Supreme Court of Illinois goes farther than that in the Southern Fire Brick <p Clay Co. case. Mr. Justice Shope in Consolidated Coal Co. of St. Louis v. Schmisseur, 135 Ill. 371, says: “It seems to be well settled that where there is an express negative covenant courts of equity will entertain bills for injunction to prevent their breach, although the same will occasion no substantial injury or though the damages, if any, be recoverable at law.” But he adds: “This is upon the principle that the owner of land selling or leasing it may insert in his deed or contract just such conditions and covenants as he pleases touching the mode of enjoyment and use of the land. ’ ’

It does not seem necessary to extend this opinion by a discussion of whether all the opinions in the Appellate Courts of this State or the .opinions of courts in all other States are consistent herewith or with each other. For the considerations that are above given and which are to a large extent identical with those advanced by the Supreme Court of Michigan in Hardy v. Allegan Circuit Judge, supra, and by this court in Rabinovich v. Reith, 120 Ill. App. 409, and in Bour v. Illinois Cent. R. Co., 176 Ill. App. 185, we think the injunction order should not have" been granted,, and, having been granted, should have been dissolved. The order appealed from is therefore reversed.

Reversed.