author: Lacey, P. J. Bakeb, J.'

text:
    Clark Hollenback v. Davidson Todd et al.
    Bailment — Right op action pob possession. — As against a wrongdoer or trespasser, the bailee, or the one having possession of personal property, has aright of action to recover either in trover or trespass, in case he is disturbed in or deprived of possession. As between such bailee and a mere wrongdoer, the former is the owner and has title to it.

      Appeal from, the Circuit Court of Kendall county; the Hon. C. W. Upton, Judge, presiding.
    Opinion filed April 5, 1886.
    Messrs. Fowler Bros, and Mr. A. E. Searles, for appellant.
    Mr. A. J. Hopkins, Mr. FT. J. Aldrich and Mr. F. H. Thatcher, for appellee.
   Lacey, P. J.

On the 14th day of October, 1881, the appellant commenced a suit in attachment against Davidson Todd and Thomas J. Terrell, in the Circuit Court of Kendall county, and the attachment writ was levied on between eight and nine thousand bushels of corn as the property of Todd ife Terrell in the elevator at Millbrook in said county. Todd & Terrell gave a forthcoming bond, and subsequently the appellee herein, Jacob S. Budd, filed a plea of interpleader claiming to be the owner of the property in question so attached. Upon this plea issue was joined and a trial had before a jury, which resulted in a verdict in favor of appellee. Motion for new trial was overruled and judgment rendered against the appellants for costs, from which judgment an appeal is taken to this court.

The warehouse and elevator belonged to the father of appellee, Jacob Budd, and he had rented the house to Todd & Terrell. The latter had operated it for some time as a warehouse, buying and storing grain. The appellee, among others, had stored a quantity of grain with Todd & Terrell, and it had been shipped out by them. Todd & Terrell failed prior to the 1st day of September, 1881, and could procure no more money to purchase grain or pay for that which- they had contracted for, and being in debt to Jacob Budd to considerable amount, and Jacob Budd being their security in Chicago to Wanzer & Co., procured his son, Jacob S. Budd, the appellee, to take possession of the warehouse and to purchase the contracts for grain that Todd & Terrell had with different farmers, to the number of seventeen, which by a written' agreement was for value received, assigned and transferred by Todd & Terrell to the appellee, on the 10th day of September, 1881, he having taken possession of the warehouse on the first day of said month. Terrell continued in the warehouse for appellee on wages.

Prior to the commencement of this suit the appellants demanded the corn of Todd & Terrell he had stored with them, also demanded it of appellee as well as of his father. The corn which was levied on was corn that appellee had taken partly under the contracts so purchased and partly that which he had purchased independently of farmers and which he had in store. Appellee was a young unmarried man about twenty-two years of age and resided with his father and had been engaged in farming. ' He had no considerable means- of his own and it did not require any to purchase out Todd & Terrell for they had no corn in the warehouse at the time appellee took possession. The warehouse and elevator belonged to his father and his father, loaned him $500 to begin business with and the balance of the money to purchase the grain with; prior to the attachment he borrowed of his commission merchants, Tomblin & Co., of Chicago. Hone of the corn called for by the contracts had been paid for by Todd & Terrell, nor any portion of it. The only possible advantage that appellee could have had on account of the contracts was that he had so much corn secured, and any advance in the price of the corn above the contract price at the time of delivery.

The main cause for error insisted on for reversal is that the court refused the appellant’s instructions Hos. 5, 7, 8,9 and 10 “refused,” which go to the point of telling the jury that if the property in question was the property of Jacob Budd and not appellant, the verdict should be for appellant. It is insisted that the property was really the property of Jacob Budd, and that his son’s name was only used nominally and that he had no real interest in it. The substance of the fifth refused instruction is given in the appellant’s first and third “given” instructions, except that the jury are told that in determining whether the purchase of the corn was Iona fide * * * the jury had a right to consider the objects and purposes of the sale, whether fraudulent or not, whether for the purpose of hindering and delaying the creditors of Todd & Terrell, etc.

On reading this instruction it will he observed that the jury are told by it that they must consider as a fact and as a part of the circumstances, the objects and purposes for which the sale was made, whether fraudulent or not, and whether or not for the purpose of hindering or delaying the creditors of Todd & Terrell from collecting their claims at that time,” etc. These were not evidentiary facts, and their existence could only be arrived at after a consideration of all the evidence and circumstances; hence it would be misleading and confusing to the jury to instruct them to look upon the ultimate conclusions to the jury to be determined from the evidence as facts in evidence. It in a measure assumes that the sale was fraudulent and made for the purpose of hindering and delaying creditors.

The point in the instruction that the jury could go behind the written assignment is covered in substance in “ given ” instructions land 3; and it was not important that the jury should be tond in express language that they could do so, having been so told in substance. Thq proper portions of the 7th and 8th instructions “ refused” were given in the 3d. The 8th, as a whole, was erroneous in assuming that the “Budds” purchased the corn in question. This was a disputed fact, the appellee sharply contending that he alone purchased it. The instruction offered by appellant and refused by the court is to the effect that if the real transaction was for the benefit of Jacob Budd,” and he, in fact, was the one “ interested in such purchase,” was the owner of the effects and property in question, although the proofs may show that the same was made to Jacob S. Budd, nominally, from Todd & Terrell, then the jury should find that the property in question was not the property of Jacob S. Budd.”

This instruction raises the point that seems to be chiefly, if not entirely, relied on to reverse the judgment of the court below. We do not think the instruction was proper, or the law governing the case as presented to the jury.. Appellee, by interpleader, claimed the property as his own, and we think against a party like the appellant, who had no claim or right to it whatever in case appellee’s contract with Todd & Terrell was iona fide, the proof that he was the bailee and had the entire control and possession of it, and had borrowed money in his own name to purchase it, was sufficient upon which to base a recovery, and his plea of property in himself was made out.

As against a wrongdoer or trespasser the bailee, or the one having possession of personal property, has a right of action to recover either in trover or trespass in case he is disturbed in or deprived of possession. As between such bailee and a mere wrongdoer the former is the owner and has title to it. What matter is it to the appellant whether appellee had a perfect title to this corn or not, as between himself and father? The appellant certainly had no claim to it unless through Todd & Terrell.

The appellant’s writ of attachment ran against Todd & Terrell and not against appellee or his father, Jacob Budd. The property was found in the peaceable and undisturbed possession of appellee, and levied upon as the property of Todd & Terrell. There might have been a right of action in favor of appellee in trespass against the sheriff for this levy, and in such case the sheriff could not have been permitted to set up such defense as is attempted here. The possession of appellee would have been all he need have shown, and his title could not have been attacked. But instead of resorting to his action of trespass he seeks his rights under the statute by tiling his interpleader claiming the property, and if the property is found by the jury not to be that of Todd & Terrell, it must be restored to the appellee, who was the bailee, at least, if not the absolute owner. We see no merit in equity or law in such claim as is set up by this instruction, and it was properly refused. The tenth refused instruction is bad, because it assumes that the two Budds” had an interest in the assigned contracts, and the court need not give it, for it would have been simply a repetition of Aos. 1 and 3 ah’eady given.

It is also objected that the question as to whether or not appellee had ever taken possession of the property was ignored in appellee’s instructions. This it is insisted was error.

We think that there wa.s no error in this, for the reason that his having taken possession of the warehouse and elevator, and his having succeeded Todd & Terrell in the business, and of his claiming to buy corn on his own account, was notorious — known to nearly every one, and to none better than appellant himself, who was expressly notified of it before his attachment was issued. So no harm could be done in assuming that appellee had actual possession before the attachment writ was issued.

It is finally claimed that the verdict is against the weight of the evidence on the vital point as to the good faith of the purchase of the contracts from Todd & Terrell, that is, whether it was done for the purpose of hindering and delaying their creditors. We can not but think, after reading the evidence, that there are slim grounds for such claim.

It will be observed that no corn whatever, nor other grain, was purchased by appellee of Todd & Terrell. The latter were hopelessly insolvent, had nothing, and could get no more money in Chicago of commission merchants. They were h avily indebted to Jacob Budd, the owner of the warehouse and elevator, and he was security for them for other sums. Todd & Terrell had no avail except certain executory contracts for the purchase of corn, to be paid for on delivery— which might be worth something or nothing as the price of corn advanced or declined. They could not get the corn unless they had money to pay for it. If the transfer was made for the ultimate benefit of Jacob Budd, as is claimed by appellant with considerable force, it must have been done by Budd to save himself and to keep the warehouse property from depreciating, and not to defraud any one. Then, appellee furnished every dollar of the money that paaid for the corn on his own credit; would a man naturally enter into such a transaction as this and consent to act as a cover for mere friendship ? Involve himself in debt to the amount of thousands of dollars for accommodation, for the mere love of intrigue, without the expectation of any benefit? There being no necessity for such a contract we can not believe that appellee or any reasonable man would embark in it and take, such risks for mere accommodation, and, what is most serious, run the risk of having the corn taken to pay Todd & Terrell’s debts, having the money borrowed with which to purchase the corn, to be paid by himself, which would be the result if this corn is taken by appellant.

All parties who had anything to do with the purchase of the contracts and agreement betweeu Todd & Terrell and appellee, testify that the contract was iona fide, and, under the circumstances, what could the jury do other than to believe the appellee’s witnesses and return a verdict for appellee. We think the evidence very decidedly preponderates in favor of appellee.

We see no error in the exclusion of the evidence offered of George M. Hollenback. The relation of client and attorney existed between him and Terrell, and appellee was not present; as against him it would not have been competent in any event.

Seeing no error and being .fully satisfied of the justice of the verdict the judgment is affirmed.

Affirmed.

Dissenting opinion by

Bakeb, J.'

In nay opinion the judgment should be reversed. 1 think the decided weight of the evidence is to the effect that J. S. Budd, who filed the interpleader, was the bailee of' Jacob Budd, his father, and as between themselves Jacob Budd was the real owner. In that state of the case the statements and admissions of Jacob Budd, in evidence, tending to prove fraud, should not have been excluded from the jury by the instructions of the court. I also think there were other errors in excluding testimony. Under the rulings of the court the issue was not fairly submitted to the jury. I think, however, the title and possession of J. S. Budd as bailee, if not fraudulent, would be sufficient for the maintenance of his interpleader.


source: Caselaw Access Project

author: Baker, J.

license: Public Domain

text:
    Samuel E. Holtzman v. Joseph Hoy.
    1. Action fob damages against physician — Evidence.—In an action on the case against a physician and surgeon, to recover damages for the want of ordinary care, caution and skill in his management and treatment of a broken leg, evidence to establish his reputation as an ordinarily skillful and learned physician and surgeon is inadmissible.
    2. What is bequibed of physician. — The law does not require of physicians and surgeons the highest degree of skill, but it demands that they shall possess the ordinary skill of those engaged in the profession, and treat their patients with ordinary skill and care, and exercise their best judgment.
    3. Instructions. — An instruction that “ mere expressions of opinion by defendant to plaintiff as to the condition of his leg, and that it was doing all right, should not be considered by the jury in deciding as to whether the previous treatment of plaintiff’s leg had been proper,” was properly refused.
    Error to the Circuit Court of Livingstone county ; the Hon-Franklin Blades, Judge, presiding.
    Opinion filed June 8, 1886.
    Messrs. Stephenson & Ewing, for plaintiff in error;
    that a physician is only bound to possess the ordinary skill and learning possessed by those ordinarily learned and skillful in his profession, and to exercise his best care and skill, cited 1 Hilliard on Torts, 225; Leighton v. Sargent, 7 Foster, 460; Teft v. Wilcox, 6 Kan. 61; Branner v. Storment, 9 Kan. 51; Simons v. Henry, 39 Me. 155; Quinn v. Donovan, 85 Ill. R. 194; McClelland’s Civil Malpractice, 215; McNevins v. Lowe, 40 Ill. 210; Ritchey v. West, 23 Ill. 385; Fisher v. Niccolls, 2 Bradwell, 484.
    Messrs. Straws & P Arrow, for defendant in error;
    that evidence of the physician’s reputation as an ordinarily skillful physician and surgeon was inadmissible, cited Boydston v. Giltner, 3 Oregon, 118; Williams v. Poppleton, 3 Oregon, 139; Leighton v. Sargent, 11 Foster (N. H.), 120; Mertz v. Detweiler, 8 W. & S. 376.
   Baker, J.

This was an action on the case, brought by Joseph Hoy, defendant in error, against Samuel E. Holtzman, plaintiff in error, to recover damages for the want of ordinary care, caution and skill by Holtzman, as a physician and surgeon, in his management and treatment of the broken leg of Hoy, per quod it failed properly to unite, and united only by an infirm flexible ligament.

The verdict and judgment were against Holtzman for §2,500 damages.

There was quite a sharp conflict in the testimony with reference to the actual facts of the treatment bestowed. The accounts given by Hoy and the several witnesses introduced by him in regard to the conduct and management of the attempted cure of the fracture, were different in several important and material points from the history of the treatment as detailed by the attending surgeon. A large number of expert witnesses were introduced by each of the parties to the suit, and there was not any very considerable degree of disagreement in their testimony. The substance of the expert evidence seems to be that upon the hypothesis the management of the case was as stated by the witnesses for Hoy, then it • was not ordinarily skillful and careful; while upon the hypothesis that the facts were as insisted by Holtzman, then ordinary skill and care "were bestowed.

We are unable to say, upon a consideration of the whole testimony, that it does not sufficiently support the verdict.

Plaintiff in error offered upon the trial evidence to establish his reputation as an ordinarily skillful and learned physician and surgeon, but an objection was sustained thereto and an exception taken. We think the ruling of the court was right. The issue before the jury was in respect to the propriety of the treatment in the particular case under investigation; and if want of ordinary skill or negligence in that case were shown, it would have been no answer to say the physician and surgeon had a good reputation for skill and learning. In Metz v. Detweiler, S Watts & Serg. 376, the Supreme Court of Pennsylvania say: u It may be said that his general qualifications might serve to shed light on the propriety of his practice in this particular instance; but it is a light which Avould be less likely to lead to a sound conclusion than to lead astray. The jury, assisted by the opinions of medical witnesses, would be better able to judge of the treatment from the treatment itself than from the more remote consideration of the defendant’s professional reputation, which Avas consequently not tlie best evidence of which the case was suscepti. ble.” See also Leighton v. Sargent, 11 Foster, 119. It may also be remarked, that a question regarding professional reputation Avas only propounded to two Avitnesses, Dr. Allen and Dr. Gaylord; in the first instance, upon objection being made, it was AvithdraAvn without being passed upon by the court; and in the second instance the question not only called for the reputation of plaintiff in error Avith the medical profession, but in the community; and it Avould seem that in any view of the matter the reputation of the physician in the community at large Avould be an improper element for consideration.

It is also urged that six of the instructions submitted by .plaintiff in error were improperly refused.

While the laAV does not require of physicians and surgeons the highest degree of skill, yet it does demand of them that they shall possess the ordinary skill of those engaged in the profession, and treat their patients with ordinary skill and care, and exercise their best judgment. One of the instructions given by the court, at the instance of the defendant below, was, that if such defendant “ used ordinary skill and care in the treatment of plaintiff’s fracture, and while so using such care and skill made a mistake in judgment, then he is not liable for the result of such mistake.” So far as the first refused instruction was proper, it was a mere repetition of the legal principle contained in this instruction; as to the residue of the instruction it was argumentative, and might properly have been refused on that ground. We are of opinion, however, it was otherwise vicious, for by it the court was asked to tell the jury “that there is no issue made by plaintiff, that the defendant is not a reasonably or ordinarily learned and skillful physician and surgeon, etc., and if he exercised his best skill and judgment, etc., then he is not liable.” This was calculated to mislead the jury, for the logic of it was that he must have exercised the ordinary and usual skill of his profession, simply because he possessed it. Besides, we do not understand it to be an admitted fact of the case that the doctor was possessed of the required degree of skill. While no count of the declaration proceeds upon the distinct ground he did not possess the ordinary skill of his profession, yet they all are based upon the theory he failed to exercise such ordinary skill. If evidence proves or tends to prove more than is necessary, yet it is proper if it proves or tends to prove the point that is really at issue. If, in the treatment of this particular case, such gross ignorance of the business of a surgeon had been shown as to establish the fact beyond doubt that the physician had not the degree of skill usual to the profession, or no knowledge of it at all, such evidence would clearly have been responsive to the issue formed. In other words, .if there was a want of ordinary skill in the treatment, then it was wholly immaterial whether the default arose from an absolute lack of skill and knowledge, or from mere neglect to use the skill actually possessed; and we think that neither the one nor the other of these views of the case should have been excluded from the consideration of the jury by an instruction.

The counts in the declaration do not set out specifically wherein the want of skill and negligence consisted. We must therefore look to the evidence in order to ascertain the particular grounds of complaint. They seem to arrange themselves under five heads: i. e., that the Liston splints were taken off too soon; that the surgeon knew at the time the first plaster of paris bandage was applied to the fractured leg, that it was composed of poor material, and did not furnish a firm ¡-support, and that it was negligence or malpractice to leave the femur without such support for about twenty-four hours ; that the second plaster of paris bandage was permitted to be-ome loose, so that it was insufficient to hold the broken bone in place; that the surgeon directed the patient to stand upon and use the broken leg before there was any bony union, and when there were no sufficient supports to hold the fractured parts of the broken femur in position; and that after the broken leg had failed to properly unite, and there was only a ligamentary union, the surgeon failed to inform him the union was only ligamentary and advised a surgical operation, but told him the leg was all right, and that he would walk without crutches within a year. There was a conflict in the testimony bearing upon this latter ground of complaint; and the court asked, in the second refused instruction, to charge the jury that if they believed from the evidence that defendant told plaintiff that the union of his broken leg was only ligamentous, and not bony, and that it would be necessary to have an operation in order to procure bony union, and advised such operation, and that defendant, up to that time, had exercised the ordinary skill of a surgeon in ¡attending upon the broken leg, then the jury shouldfind defendant not guilty. The principle that but ordinary skill was required of plaintiff in error was fully announced in the 1st, 6th, 10th and 11th instructions given on his motion; and the principle that the failure to secure a proper .union must be traceable to some default of the surgeon was clearly stated in the 8th, 9th, 10th and 12th instructions so given. The only difference between this refused instruction and those referred to was, that the former singled out one of the five supposed instances of malpractice, and told the jury that if they found for plaintiff in error as to that, then, if there was ordinary skill as to the other supposed delinquencies, the verdict should be, not guilty. Each one of the other claimed delinquencies might just as well, and in the same way, have been made the basis of a similar and separate instruction. We are unable to say that the action of the court in refusing it was erroneous.

The ruling upon the third refused instruction was proper-It singled out several circumstances in evidence and ignored others of equal importance bearing upon the same point, and told the jury that these selected circumstances should be considered, thereby giving them undue prominence.

The fourth refused instruction was as follows: “Mere expressions of opinion by defendant to plaintiff as to the condition of his leg, and that it was doing all right, should not be considered by the jury in deciding as to whether the previous treatment of plaintiff’s leg had been proper.” There is considerable testimony to show that statements of the kind indicated were made frequently, and all along during the treatment. The result shows they were incorrect; and there is evidence tending to prove that such statements, in many instances, were not justified at the times when made by the then existing state of things and condition of the limb of the patient. If plaintiff in error did not at the times of these several statements have knowledge of the true condition of his patient to the extent that a surgeon of ordinary skill and learning would he required to know from his examinations, then we are unable to see why such want of knowledge and incorrect diagnosis is not competent testimony tending to prove a want of ordinary and usual skill, learning and care in the management of the case.

We think the instruction was properly refused.

The substance of the fifth refused instruction is to be found in the 1st* 8th, 9th, 10th and 12th instructions] given for plaintiff in error; and there was therefore»no error in refusing it.

The sixth refused instruction was vicious for the same reason the third was; and it was also argumentative; and so far as it announced any correct rule of law, it was covered by other instructions.

The series of twelve instructions that were given on behalf of the plaintiff in error presented the law of. the case as favorably and fully as was necessary; and it was not the duty of the trial court to repeat again and again, but in variant forms, legal principles already announced in other instructions.

We find no error that should reverse the judgment, and it is therefore affirmed.

Affirmed.


text:
    William Richards v. Elizabeth Richards.
    1. Habitual drunkenness. — In a suit for a divorce on the ground of habitual drunkenness an instruction that if the jury believed from the evidence that the defendant, for a period of two years prior to the beginning of the-suit, was frequently and customarily or habitually given to the excessive use-of intoxicating drink, and had during said two years or more lost the-power or the will, by frequent indulgence, to control his appetite for it,, then the defendant was guilty of habitual drunkenness, was proper.
    , 2. Same. — It was not error to refuse' an instruction to the effect that to constitute the habitual drunkenness the intemperance must be such as to disqualify him from attending to his business during the principal portion of the time usually devoted to business.
    Appeal from the Circuit Court of La Salle county; the Hon. George W. Stipp, Judge, presiding.
    Opinion filed June 8, 1886.
    Messrs. Bull, Strawn & Huger and Messrs. Mayo & Widmer, for appellant;
    cited Mahone v. Mahone, 16 Cal. 626; McKay v. McKay, 18 B. Mon. 8; Camp v. Camp, 18 Texas, 528.
    Mr. L. W. Brewer and Mr. D. B. Sjstow, for appellee;

      cited Murphy v. People, 90 Ill. 60; C. & R. I. R. R. Co. v. Crandall, 41 Ill. 234.
   Baker, J.

This was a bill for divorce filed by Elizabeth Bicliards against her husband, William Eichards, charging habitual drunkenness for moré than two years, adultery, and extreme and repeated cruelty.- The verdict and decree were for her on the first mentioned ground. The record is now brought here, and various errors are assigned.

The evidence is quite voluminous and conflicting, and we think sufficiently supports the verdict. If the statements of appellee and her witnesses were believed by the jury, then they were fully justified in returning a verdict that appellant had been guilty of habitual drunkenness for the space of two years prior to the filing of the bill. Numerous witnesses, many of them business men in Streator, were introduced on the part of the defense, who testified they had met appellant, some of them quite frequently, and had never seen him intoxicated. The weight of their statements is much weakened by the facts, which appear in evidence, that he lived on a farm adjoining the city limits and did much of his drinking at home, and in saloons located outside of the corporation, and after night. In Murphy v. People, 90 Ill. 59, in speaking of this character of testimony, the court said: We lay no stress on the fact that some witnesses, having a pretty fair knowledge of Leahy’s habits, never saw him intoxicated. Such evidence is negative only, and does not disprove the affirmative evidence of those who testify to having seen him drunk.”

Many objections are urged with reference to the rulings of the court upon the admissibility of testimony. From the examination we have made, we are inclined to think the decisions were substantially correct. Extreme and repeated cruelty was a substantive charge in the bill, and facts tending to prove that charge were properly admitted. in evidence, even if such facts did not tend to prove drunkenness; and the circumstances that appellee did not, when the evidence was closed, ask for a verdict on the ground of cruelty, did not relate back and have the effect to render the rulings of the court in that behalf erroneous. There was no motion made to exclude such testimony. The conversation with Dr. Finley was not improperly admitted, as appellee first stated she thought her husband was there, and afterward stated positively that he heard what was said. There was no error in sustaining an objection to the question that was propounded to appellant in his own behalf; it was leading and suggested the answer that was desired. The trial court must be allowed to exercise a large discretion on the subject of leading questions. Parmelee v. Austin, 20 Ill. 35. We have referred to the principal points made under this assignment of error, and do not deem it necessary to specify the others. We may remark that it would be indeed strange if in the course of a long trial in a warmly contested ease, where frequent objections are interposed, many of which are captious, if not trivial, the rulings of the court should in every instance be entirely accurate and above criticism. If there were any errors committed on the trial in this regard, they are not sufficiently manifest to justify a reversal on that ground.

The court instructed the jury that if they believed from the evidence that the defendant, for a period of two years prior to the beginning of the suit, was frequently and customarily or habitually given to the excessive use of intoxicating drink, and had, during said two years or more, lost the power or the will, by the frequent indulgence, to control his appetite for it, then the defendant was guilty of habitual drunkenness. And the court refused, when requested so to do by the defendant, to instruct the jury that before they could find the defendant guilty a preponderance of the evidence must show that for a continuous period of two years prior to the filing of the bill the defendant had a fixed,,habit of drinking to excess to such a degree as to disqualify him from attending to his business during the principal portion of the time usually devoted to business.

Bouvier defines an habitual drunkard to be “ a person given to inebriety or the excessive use of intoxicating drink, who has lost the power or will, by frequent indulgence, to control his appetite for it.” In State v. Pratt, 34 Vt. 323, it was said: “ An habitual drunkard is one who is in the habit of getting drunk, or is commonly or frequently so, but not necessarily always or universally drunk; ” and it was there further said, the common term or phrase uses liquor to excess when applied to a person is ordinarily understood to mean the same as saying that he gets intoxicated or drunk.” In Commonwealth v. Whitney, 5 Gray, 85, it was said that he is an habit ual drunkard whose habit is to get drjmk, whose inebrietyhas become habitual.” In Ludwick v. Commonwealth, 18 Penn. St. 174, this language was used: Occasional acts of drunkenness do not make one an habitual drunkard. Mor is it necessary he should be continually in an intoxicated state. A man may be an habitual drunkard and yet be sober for days and weeks together. The only rule is, has he a fixed habit of drunkenness.” In Magahay v. Magahay, 35 Mich. 210, the court held the defendant was an habitual drunkard within the meaning of the divorce law; and as the basis of that conclusion they said, he has a habit of indulging in intoxicating liquor so firmly fixed that he becomes intoxicated as often as the temptation is presented by his being in [the vicinity where liquor is sold. He either makes no vigorous effort to resist and overcome the habit, or his will has become so enfeebled by indulgence that resistance is impossible.” In Murphy v. People, 90 Ill. 59, it was held that a person who is in the habit of getting intoxicated is one who has the involuntary tendency to become intoxicated, which is acquired by frequent repetition.

We think these authorities fully establish the propriety of the action of the court in charging the jury as it did, and in refusing to instruct as asked by appellant. The only authority to which our attention has been called which seems to hold the law to be as contended for by appellant, is the case of Mahone v. Mahone, 16 Cal, 626, and it will be noted that the point for decision in that case was this: the charges of the court below had been such as to convey the idea to the jury that the habit of drinking to excess must be of such a character as to render the party at all times incapable of attending to business, and the court of review held the charge was too stringent, and in that connection said: If there is a fixed habit of drinking to excess to such a degree as to disqualify a person from attending to his business during the particular portion of the time usually devoted to business it is habitual intemperance, although the person may at intervals be in condition to attend to his business affairs.” It is hardly to be presumed from this, that the court intended to hold that there could be no such thing as habitual intemperance or drunkenness unless it was indulged in during the usual business hours of the day. The reason why the law makes habitual drunkenness a ground for divorce is not alone because it disqualifies the husband or wife from attending to business, but in part, if not mainly, because it renders the person addicted thereto unfit for the duties of the marital relation, and disqualifies such person for properly rearing and caring for the children born of the marriage. In Burns v. Burns, 13 Fla. 376, the court say: “ The charge of habitual intemperance can only refer to a persistent habit of becoming intoxicated from the use of intoxicating drinks, thus rendering his presence in the marriage relation disgusting and intolerable.” The intructions asked were also objectionable in this, that they required that the habit of drinking to excess should have been persisted in for the “ continuous ” period of two years ; this was calculated to mislead the jury. As we have seen, the authorities are all to the effect it is not necessary the defendant should be continually in an intoxicated state, or universally drunk.

For a similar reason to this last, the action of the court in refusing to give the fourth instruction asked by appellant, without first making a modification, was right.

The fourteenth instruction was objectionable, in the form in which it was presented to the court; under it, even though the habitual drinking existed to such an extent as to deprive appellant of his faculties, and render him unwilling to control his appetite for strong drink, and unfit to attend to his usual affairs and business, yet such drinking would not be excessive.

We think the fifth and tenth- instructions given on behalf of appellee are somewhat objectionable. The first mentioned is' argumentative, and calls the special attention of the jury to an inconclusive fact, thereby giving it undue prominence. Tlie other, in the first part of it, trenched upon the province of the jury, but this was substantially cured by what followed. The defects in these two instructions were not of such character as'to mislead the jury, and it is improbable that appellant was in any way injured thereby.

Upon consideration of the whole record, we are of opinion the decree should be affirmed.

Affirmed.


text:
    Anne G. Paddock v. Eugene C. Bates, Assignee, etc.
    1. Assignment — Coll ater al security does not affect dividends.— In a voluntary assignment for benefit of creditors under the statute, where one claimant holds collateral security, but not sufficient to satisfy his entire debt, dividends should be allowed to such claimant on his whole claim, and not merely upon the ¡residue only, after deducting the value of the security held.
    2. Same — Assignee more than a mere volunteer. — While the assignee is a mere volunteer in respect to the property rights acquired from the assignor, yet he is something more than a mere representative of the assignor, in respect to the distribution of the assets of the insolvent estate.
    Appeal from the Circuit Court of Bureau county; the Hon. George W. Stipp, Judge, presiding.
    Opinion filed June 8, 1886.
    July 2, 1883, the firm of Sower Brothers, of Princeton, Illinois, executed their- promissory notes to appellant, Anne G. Paddock, and secured the same by their trust deed of even date therewith, on their mill property in Princeton.
    April 28, 1881, said Sower Bros, being insolvent, executed their deed of assignment of all their property to Eugene-C. Bates, for the benefit of all their creditors, and mentioned appellant’s claim at $1,000 in the list of creditors attached to said deed of assignment.
    May 15, 1881, said assignee notified all creditors of said firm to present their claims within three months thereafter.

      ■ August 14, 1834, said Anne Gr. Paddock proved and presented her claim for $1,017, under oath, - to said assignee, being the balance owing her upon said notes.
    August 18, 1884,' said assignee filed with the clerk of the county court ar list under oath of all such creditors as had proven and presented their claims to him, which list included the claim of appellant for $996.08 and interest thereon from April, 26,1884, at seven per cent., and a statement that said claim was secured by said trust deed; and no person interested as creditor or otherwise within thirty days thereafter, made any objection or filed any exception to appellant’s claim, as the same was proven, presented and reported.
    December 30,1884, appellant’s claim amounted to$l,043.33, and the value of the property securing the same by said trust deed was only $765.75 (the mill having been destroyed by fire).
    December 30, 1884, said assignee made a report to the county court, and therein prayed for an order of distribution of thirty per cent, among the creditors, except to appellant, and asked for an order to pay to her thirty per cent, on the excess of her claim over and above said $765.75, and to hold in his own hands thirty per cent, on said $765.75, until her rights in the mortgaged property "should be determined and realized ■upon.
    Anne Gr. Paddock and her trustee, prior to and at the hearing of said cause, offered to surrender or assign her claim and her security to said assignee and the other creditors of said insolvent estate on payment in full of her claim as proven, presented and reported; or if preferred, to release her claim and said trust deed to said assignee or creditors, or to both, on such payment being made to her, and such offers were refused. ,
    At the hearing appellant moved for a dividend upon the full amount of her claim as proven, presented and reported.
    The court overruled appellant’s said motion and granted said prayer of said assignee, and ordered such distribution as prayed by said assignee.
    Anne Gr. Paddock appealed, and the cause was heard by the circuit court- upon an agreed state of facts substantially as aforesaid, and upon said report and said prayer therein, and upon the motion of appellant in said circuit court for a dividend of thirty per cent, on the full amount of her said claim as aforesaid.
    The decree of the circuit court was substantially the same as the order that had been entered in the county court. •
    Messrs. Skisker Brothers and Messrs. Kendall & Love,joy, for appellant;
    cited Morrison v. Kurtz, 15 Ill. 193; Evertson v. Booth, 19 Johnson, 486; Brinkerhoff v. Marvin, 5 Johnson’s Ch. 320; Woolcocks v. Hart, 1 Paige Ch. 185; Morris v. Olevine, 22 Penn. 44; Brown v. Cozard, 68 Ill. 178: Findley v. Hosmer, 2 Conn. 330; West v. Bk. of Rutland, 19 Vt. 403; Graeff’s Appeal, 79 Penn. 146.
    An assignee, under a voluntary assignment for the benefit of creditors, does not represent the creditors, but is the exclusive representative of the assignor: Hawks v. Pritzloff, 51 Wis. 162; Easterbrook v. Mississmitt, 18 Wis. 551; Hemricks v. Woods, 7 Mo. Ap. 236; Morris’ Appeal, 88 Penn. St. 382.
    Messrs. Eckels. & Kyle, for appellee;
    that the general principle is that if one party has a lien on or interest in two funds for a debt, and another party has a lien on or interest in one only of the funds for another debt, the latter has a right in equity to compel the former to resort to the other fund, in the first instance, for satisfaction, cited 1 Story Eq. Jurisprudence, See. 633; Wise v. Shepherd, 13 Ill. 41; Hurd v. Eaton, 28 Ill. 122; Marshall v. Moore, 36 Ill. 321; Morrison v. Kurtz, 15 Ill. 193; Doyle v. Murphy, 22 Ill. 502; Sweet v. Redhead, 76 Ill. 374; Rogers v. Meyers, 68 Ill. 92; Hords v. Burton, 79 Ill. 508.
   Baker, J.

The claim of appellant was duly established in the county court as a valid claim against the estate of the insolvents. The main question at issue in this litigation is whether, the value of the collateral security held by her being insufficient to pay her debt in full, the dividends to be paid her out of the general assets in the hands of the assignee should be upon the basis of the whole of her claim, or upon the basis of the unsecured excess of her claim.

The ground taken by appellee is, that the rule in equity requires that if one party has a lien on or interest in two funds for a debt, and another party has a lien on or interest in one only of the funds for another debt, then the former should be compelled to resort to the fund upon which only he has a lien or in which only he has an interest, in the first instance, for satisfaction; and that the true doctrine is that when a debtor has made an assignment for the benefit of creditors, a creditor having a special security should be required to first exhaust such security, and should receive a dividend only upon the unsatisfied or unsecured portion of his debt. The ground taken by appellant is, that there will be no marshaling of assets, and this rule in equity will not be enforced when it trenches upon the rights, or operates to the prejudice of the party entitled to the double fund; and that the orders of distribution made by the county and circuit courts do trench upon her rights and operate to her prejudice.

Upon the particular point in controversy, as to whether the dividend paid to appellant, her security not being sufficient to satisfy her entire debt, should be a pro rata dividend on the whole amount of her claim, "or upon the residue only after deducting the value of the security held, the authorities are in conflict, and a plausible reason can be given for either view. We think the weight of authority is in favor of the proposition that the dividend should be allowed on the whole claim, and that seems to be in accordance with the doctrine as held in til's Stite. Morrison v. Kurtz et al., 15 Ill. 193, was a case analogous to this. There Morrison held a debt against a copartnerdi'p, which was secured by a deed of trust on real estate beffinging to one of the firm in his own right; and the circuit court decreed that he should first exhaust the real estate, and that if after having exhausted the real estate there should be a ba'ance unpaid against the firm, he was to become a general creditor in respect to the assets of the firm and be paid in the same manner with the other creditors to the extent of said balance, and that money should be retained by the commissioner sufficient to pay any deficiency of the claim of Morrison, which might exist after the sale of the real estate on which he held the deed of trust. The decree was reversed, and in their opinion the court referred to the fact that the firm was insolvent and said: “While a court of equity has an undoubted authority to compel one creditor to satisfy his debt out of a particular fund to which he alone can resort, yet it will never do this to the injury of such creditor, or where that course will work injustice to other parties. * * * We think Morrison has a right to insist upon his distributive share of the cash raised from the sale of the property as a creditor of the firm. As a creditor of the firm he has the same abstract right to the proceeds of the sale as the other creditors. He is as meritorious in every respect as they; and because he was more vigilant or cautious in requiring security, it is no reason why he should be. put in a worse condition than the other creditors, by having his debt postponed and his payment delayed till by a proper proceeding he can realize out of the property upon which his debt is secured; while the other creditors are paid in cash.” See also, Brown v. Cozard, 68 Ill. 178, and Sweet et al. v. Redhead, 76 Id. 374.

Section six of the Voluntary Assignment Act provides that the court shall order the assignee or assignees to make, from time to time, fair and equal dividends among the creditors of the assets in his or their hands, in proportion to their claims; and section thirteen provides that all debts and liabilities within the provisions of the assignment shall be paid fro rata from the assets thereof. It is an adjudicated fact that the claim of appellant is a debt and liability within the provisions of the assignment that was made by Sower Brothers, and she has a statutory right to have and receive a fro rata share from the assets of the assignment. In respect to the real estate covered by the trust deed, thq, only property or right therein that was included in the assets of the assignment was the equity of redemption that was vested in Sower Brothers; and the residue of the property therein belonged to appellant. There is no pretense she has been paid any portion of her claim; it is still, in its entirety, a debt against the assignors, upon which they might be sued and a personal judgment against them recovered. If she does not get her distributive share on the full amount of her claim, how can it be said that the assets of the assignment have been paid prorata upon all the existing indebtedness? How can it be said that the order entered by the court directs an equal dividend of the assets in the hands of the assignee among the creditors in proportion to their claims ? As a creditor whose claim has been established in conformity with the requirements of the statute, appellant has the same right to her pro rata share of the assets ready for distribution that the other creditors have to their pro rata shares. It is true she is the beneficiary in a trust deed given to secure her debt, but she is also a creditor of the assignors; in the one capacity she has the right to look to her security for the collection of her debt, and in the other capacity she has the right to look to the assets that were covered by the assignment, and her two remedies are concurrent. Of course she can have but one satisfaction of her debt; and if the mortgaged premises should at any time produce more than is sufficient for the payment of her claim, such surplus would go to the benefit of the other creditors. And it will be noticed that prior to and at the time of the hearing appellant offered to do all that equity would require of her — that is, to surrender her special security upon full payment of her claim. The order that was made by the court marshaling the assets trenches upon the rights of appellant, and operates to her prejudice and injury. She has the right to equal dividends in proportion to her claim with the other creditors, out of the assets to be distributed, and "to have such dividends paid when theirs are paid. But, by the order entered, the other creditors received thirty per cent, upon their entire claims in cash, while she received thirty per cent, in cash upon but a fraction of her claim, while the thirty per cent, upon the residue of §765.75 was ordered to be retained by the assignee for an indefinite period. The delay in the use and enjoyment of this dividend on the §765.75 and the doubt there is about her ever getting it under the order as made, both operate to her injury. She has a right, as a cestui que trust under the assignment, and as a creditor under the statute, to be paid dividends equal, qyro rata, with those paid the other creditors; and then has a right under her trust deed, to make the residue of her debt out of the property that was, prior to the assignment, pledged as security for her debt, thereby being enabled to collect the full amount of her claim. But by the rule announced in the order of the court, the special fund being admittedly insufficient to pay her whole debt, and her debtors being insolvent, and their property including the special fund, insufficient to pay all the claims against it, it necessarily follows that she will lose a part of her claim, since she will receive upon the excess of her claim, over and above the $765.75, only the same dividends that the other creditors of the insolvent estate receive. This is in derogation of the rights she has under the deed of assignment, the statute, and the contract she was provident enough to make for the security of her debt; and that it would operate to her detriment and prejudice is manifest.

The other point made by appellant, that the rule in equity with reference to the marshaling of assets will only be applied at the instance of another creditor and never enforced upon the suggestion of the debtor, and the assignee under a voluntary assignment takes as a mere volunteer, stands in the shoes of the assignor, and can assert no right or claim that he could not assert, and that therefore it was error to enforce the rule in equity that we have considered at the instance and upon the motion of the assignee, when the debtors themselves, had there been no assignment, could not have asked it in respect to appellant, a creditor, we do not regard as of much force. While the assignee is a mere volunteer in respect to the property rights acquired from the assignor, yet, in view of the provisions and requirements of the statute now in force, he is something more than a mere representative of the assignor, in respect to the distribution of the assets of insolvent estate. Besides this, it was the duty of the county court, under the statute, either with or without suggestion from the. assignee or any one else, to make a proper order of distribution.

For the error indicated herein, the order and decree of the court is reversed and the cause remanded, with instructions to enter an order of distribution in conformity with this opinion.

R eversed and remanded.


author: Barer, J.

text:
    Charles Blain v. Alexis Rivard.
    1. Acknowledgment — Defective.—An acknowledgment which omits the word “ known ” is fatally defective.
    2. Foreclosure — Mortgagee in possession. — In an attempted foreclosure sale for covenants broken, which through informality or for some other reason, is ineffective to pass the legal title, the mortgagee, or his trustee subsequently in possession thereunder, will not be regarded as a trespasser, but as a mortgagee in possession, and might be required, on a bill to redeem, to account for rents and profits to the mortgagor.
    3. Same — -Attornment.—In such a case where the mortgagee claimed both the right to the rents and the control of the land, and the tenant on the land made an arrangement to hold the place for another year, and paid the mortgagee the rent for the current year, the law would in such case protect the tenant against suit of the mortgagor, and make him the tenant of the mortgagee, even without direction from the mortgagor.
    Appeal from the Circuit Court of Kankakee county ; the Hon. Alfred Sample, Judge, presiding.
    Opinion filed June 8, 1886.
    Mr. H. K. Wheeler, for appellant.
    Messrs. Richardson Brothers, for appellee.
   Barer, J.

In December, 1876, Alexis Rivard executed and delivered to appellant, Charles Blain, a trust deed on a tract of land in Kankakee county, for the purpose of securing a promissory note given by said Rivard to Camille Blain. The trust deed contained full covenants of warranty, and a covenant that the grantor would pay all taxes and assessments on the land when due and payable, and a provision that in case of default in the payment of the note and interest, or any part thereof, or of a breach of any of the agreements in the deed, then the grantee might enter into or upon the premises and receive all rents, issue and profits thereof; and it also contained a power of sale.

In 1879 the note was more than two years overdue, and no part of the principal or interest thereon had been paid, and default had been made in the payment of the taxes of 1876, 1877 and 1878; the land had been sold for the taxes of 1876, and appellant was informed by appellee that the man who had bought the land for the taxes of 1876 was about to take a deed, and that he had better see to it. In July, 1879, appellant made sale and foreclosure, or attempted sale and foreclosure, as trustee under the trust deed. On the first day of March, 1879, Rivard had leased the premises to one Xavier Fortier for a term of two years, said Fortier agreeing to pay as rent therefor two fifths of all crops raised thereon. At the time of the salé Fortier lived on the land, and continued to live there for several years, paying the rent to appellant, and in 1879 he raised a crop of corn there. Appellant was on the place three or four times during the season, and after the sale in July, and claimed to be in possession, and made arrangements with For-tier to stay another 3’ear. He claimed, and got the rent corn of 1879, as agent for his brother, Camille Blain, the beneficiary in the trust deed and purchaser at the sale made in July. The evidence of both Rivard and Fortier shows that the former directed the latter to deliver the corn to appellant, and weigh the first load, and said he would settle with appellant according to that one load. But it does not appear that appellant was advised of this conversation. This present suit was prosecuted by Rivard, against appellant, to recover the value of this rent corn of 1879, and he obtained a judgment in the circuit court for $195.

On the trial appellant laid the statutory foundation for such testimony, and offered in evidence the record of the trustee’s deed from himself to Camille Blain, dated July 7,1879, and showing sale under the power granted in the trust deed. The certificate of acknowledgment was fatally defective. Either intentionally or by accident, the word “known,” had been omitted from the certificate, and consequently it did not appear therefrom that the person who made the acknowledgment was personally known to the officer to be the grantor named in the deed.

The record was properly excluded by the court from the jury. Fully v. Davis, 30 Ill. 103. Thereupon appellant was unable either to produce the original deed or make sufficient proof of its loss or destruction.

In the view we take of the case, it is unnecessary to determine whether or not there was sufficient evidence afforded by the statements and admissions contained in the bill in chancery, theretofore filed by Rivard, to establish the facts of foreclosure, and that the equity of redemption was lost, and the full legal and equitaffie title vested in Camille Blain, the cestui que trust in the trust deed and purchaser at the sale. If the equity of redemption was cut off, and the full ownership vested in him, then the after accruing rents belonged to him, and the rent of 1879 was properly paid to appellant, as his agent. If, on the other hand, the foreclosure sale was ineffective to pass the legal title to Camille Blain, then he, or his trustee in possession, would not be regarded as a trespasser, but as a mortgagee in possession, and might be required, on a bill to redeem, to account for rents and profits to the mortgagor. Harper et al. v. Ely et al., 70 Ill. 581. The beneficiary in the trust deed was the purchaser, and there is no pretense he had ever received his debt and interest, or the redemption money and taxes paid, or any part of any of these demands, otherwise than in his bid for the land itself. As already stated, the right of possession and the right to collect the rents were expressly given in the trust deed. His lease to Fortier was executed after the trust deed or mortgage, and the mortgagee could not by mere notice compel the tenant to pay rent to him, but he might, after condition broken, and either with or without foreclosure, treat the tenant as a^ trespasser, and evict him; and to prevent such eviction, the tenant might attorn and pay rent to him. The evidence shows that appellant claimed both the right to the rents and the control of the land, and that Fortier made an arrangement with him to hold the place for another year, and also actually delivered to him the rent corn for the current year, and that too with the knowledge and consent of the mortgagor. This was an amply sufficient attorning on the part of the tenant to give appellant all the possession required in order to make him a mortgagee in possession. Even if there had been no direction from the mortgagor, yet the law would in such case protect the tenant against suit by the mortgagor. 1 Jones'on Mortgages, Sec. 777.

The instructions of the court were based upon the theory that if Fortier was the tenant of appellee a”t the time of the delivery of the rent corn, and appellee still in possession through him as such tenant, then there was a right of recovery. We think the instructions were in this respect erroneous, and misled the jury, and occasioned the verdict that was rendered.

The mortgagee was by the contract entitled both to the possession and the rents, hut one principal reason for giving him the right to take possession was in order to give him opportunity to collect the rents and apply them on the mortgage indebtedness. Under the circumstances of this case, it was wholly immaterial whether he had taken possession of the land or not, when the rent corn was hauled to him. Having the two rights, both given for his benefit, he might have waived, or temporarily postponed the enforcement of this one, and yet avail himself of the other. He might have insisted upon taking possession of the premises, and yet have permitted the mortgagor to collect and enjoy the rents. Ho good reason is perceived why he might not, without ejecting the tenant of the mortgagor, still claim and take the rents, provided both the mortgagor and the tenant of the mortgagor agreed thereto, or in any way permitted him so to do.

The suit was for the value of the rent corn of 1879, that had been delivered to appellant under a claim of right. Ho express promise to pay for it was shown, and such a promise would have been inconsistent with the claim made.

Ho implied promise thatwonld justify the judgment arises out of the facts in proof. If the equity of redemption had passed out of appellee, and the title and ownership had vested in the beneficiary in the trust deed, then must assuredly the law would not imply a promise to pay the mortgagor the value of the rent corn that became due, and was collected after that. If the foreclosure was ineffective, then there can be no pretense that any part of the mortgage indebtedness had at that time been paid, and the only promise that the law, under the circumstances, would imply, would be that if the rent corn of 1879 was more than sufficient to pay the debt, interest and taxes advanced, then the mortgagee or trustee would pay the surplus to the mortgagor. But it is not claimed, and does not appear, that this rent paid the whole amount due, and left a surplus.

We are of the opinion that appellee has no cause of action. The judgment is reversed.

Reversed.


text:
    James M. Lowman v. George A. Lowman et al.
    1. Mortgage — Merger.—If a mortgage is the eldest lien, and is for an amount exceeding the value of the premises, and the mortgagee, to avoid the expense of foreclosure, takes a conveyance from the mortgagor, a court of equity will not permit the mortgaged premises to be swept away from him. by a junior judgment creditor without payment of the mortgage, under the pretense that its lien had been lost by merger.
    2. Partnership — Paving individual debts with partnership assets. — Creditors alone of an insolvent firm have a right to object to an arrangement whereby the notes and accounts of the firm are turned over in payment of a note and discharge of a mortgage held by one member of the firm against the other.
    Appeal from the Circuit Court of Stark county ; the Hon. T. M. Shaw, Judge, presiding.
    Opinion filed June 8, 1886.

      On the 26th day of July, 1872, William Lowman and George A. Lowman executed to Samuel Burge & Co. their promissory note for $5,000, payable two years after date with ten per cent, interest, and also a mortgage on a tract of land in Stark county owned by William Lowman and on the west half of lots two and'three in block fourteen in the town of Toulon, owned by George A. Lowman, to secure the payment of said promissory note; and the mortgage was duly recorded on the same day. The wives of the mortgagors joined in the execution of the mortgage deed, and it contained full covenants of warranty, and waiver of dower and homestead rights. On the first day of the following April said George A. Low-man made and delivered to Branson Lowman a promissory -vote for $400 due three years after date, with interest at ten ■>er cent., and also secured it by mortgage, in which his wife joined, on the west half of said two lots in the town of Toulon, which mortgage was also recorded. On the first day of August, 1874, Branson Lowman gave to Samuel Burge & Go. a promissory note for $400 due one year after date, with ten per cent, interest. On the tenth day of the following September said George A. Lowman and wife conveyed the said west half of lots two and three in block fourteen in the town of Toulon, by warranty deed, to Samuel Burge, for the expressed consideration of $2,000, and this deed was recorded on the 20th day of March, 1875. This $2,000 was indorsed as a payment on the $5,000 note of William and George A. Low-man ; and Burge took possession of the premises and resided there until the fall of 1882 ; while so residing there he entered upon the margin of the record of the $5,000 mortgage the following: “We hereby release and forever discharge this mortgage, the note hereby secured having been fully paid and satisfied. Dated Feb’y 1,1881. Samuel Burge & Go.” He expended some $400 or $500 in making improvements on the premises ; and on the 25th of September, 1882, sold them to Hopkins Shivvers for $1,500, and said Shivvers has been in possession and paid taxes since that date.
    The evidence shows that although the $5,000 note and mortgage and the Branson Lowman note of $400 were made to the firm of Samuel Burge & Co., yet that Samuel Burge, individually, is the real and equitable owner of the claims represented by them; and that he had no actual notice of the existence of the mortgage to Branson Lowman until after the sale to Shivvers, and that lie then wrote to .said Bransun, who was at that time living in ¡Nebraska, requesting him to release the §400 mortgage, and stating to him that he held a mortgage which was a prior lien and which he could foreclose if necessary. It also appears that at the time the §5,000 note was given both William and George A. Lowman were, and at all times since have been, insolvent; and that the property mortgaged was not then, and has never been since, and is not now, worth the face of the note; and that the note and mortgage have ever since their execution been retained by and are still in the possession of Burge.
    In the winter of 1883-4, Branson Lowman assigned the §400 note and mortgage bearing date April 1,1873, to Ms son, James ¡M¡. Lowman, and the assignment of the mortgage was recorded on the 14th of August, 1884, and on the 18th of the same month said James M. Lowman, who is appellant herein, filed his bill in chancery to foreclose that mortgage. George A. Lowman, Mary E. Lowman, his wife, Hopkins Shivvers, and Samuel Burge, were defendants to the bill and filed answers, and it was stipulated that the answer of Burge should stand both as an answer and cross-bill, and that the party entitled to affirmative relief should have the same as effectually by decree as though he had filed a cross-bill, and that either party entitled to equity or relief should have the same as effectually as he would have had had all the rules of pleading been strictly adhered to.
    The testimony of George A. Lowman was to the effect that he and Branson Lowman carried on business at Toulon for about two years as equal partners under the firm name of B. and G. A. Lowman, but being financially embarrassed, ceased to do business in 1870, and that some debts of the firm still remain unpaid. That a week or two before he made the deed to Burge he informed Branson Lowman that he intended doing so, and Branson said it was “ all right,” and that he turned over to Branson the notes, accounts and boobs of the old firm under an agreement that he, Branson, would have the mortgage released. That he supposed satisfaction had been entered; had not seen the notes, books or accounts since, and could not state the amount of the notes and accounts, or how much had been collected on them by Branson;" that since that Branson had always been hard up for money, bat had never asked him to pay the note; and that Branson told him he had collected money on the notes and accounts turned over to him, and had applied some on liabilities of the firm and used some.
    The testimony of appellant was to the effect he had been bookkeeper for the firm, and does not think the assets, including notes and accounts, equaled the liabilities; that when Branson Lowman moved to Nebraska in the spring of 1882 he left the remaining notes and accounts with him to collect for the firm, but that he could get nothing out of them. He also testified that after the assignment George A. Lowman admitted to him that the note and mortgage assigned were for an honest debt, and that not a cent of the principal or interest had ever been paid; but George A. Lowman positively denied making any of these statements.
    It is deemed unnecessary to mention the other evidence in the case, otherwise than as it is briefly referred to in the opinion of the court.
    The decree of the circuit court was against appellant.
    Hr. H. Shallenbergbr and Hr. B. F. Thompson, for appellant.
    Hr. James H. Hiller, for appellees;
    cited Olds v. Cummings, 31 Ill. 188; 4 Kent, 102, 12th Ed.; 1 Hilliard on Mortgages, 3d Ed. 531; Edgerton v. Young, 43 Ill. 464; Richardson v. Hockenhall, 85 Ill. 124.
   Baker, J.

Three questions arising upon the record are submitted by the briefs and arguments of counsel for our decision.

One ground of defense made to the bill of appellant is that the note for §400 secured by the mortgage sought to be foreclosed by him was paid by George A. Lowman to Bran-son Lowman, and the mortgage satisfied before the assignment to appellant. The fact of the possession of the note and mortgage by appellant raises a presumption the note is unpaid and the mortgage not satisfied, but the force of this presumption is, perhaps, somewhat lessened by the fact that at the time of the transfer of the claim Branson Lowman did not have the mortgage in his possession, and said he did not know where it was, unless it was in the recorder’s office.

The evidence upon the question of the settlement of the note and satisfaction of the mortgage is somewhat conflicting, and not entirely satisfactory; but when regarded in the light of the surrounding circumstances, we are unable to say it was insufficient to justify the finding of the circuit court in favor of appellees. It is urged by appellant that the firm was insolvent, and therefore the assets of the firm could not lawfully be applied to the payment of a private indebtedness between its members. But the creditors alone had a right to object to an arrangement whereby the notes and accounts of the firm were turned over in payment of the note and discharge of the mortgage held by one member of the firm against the other.

A second ground relied upon by appellees is 'that a court of equity will keep alive the prior mortgage for §5,000, notwithstanding the release entered upon the margin of the record, in order to protect the title of the first mortgagee under the deed he took from the mortgagor, as against the junior mortgagee. In Edgerton et al. v. Young et al., 43 Ill. 464, it was said: “If a mortgage is the eldest lien, and is for an amount exceeding the value of the premises, and the mortgagee, to avoid the expense of foreclosure, takes a conveyance from the mortgagor, a court of equity would not permit the mortgaged premises to be swept away from him by a junior judgment creditor without payment of the mortgage, under pretense that its lien had been lost by merger.” Where a greater and a less estate meet in the same person, a merger does not always follow; it will depend upon the intention and the interest of the parties. The case .at bar is much like that of Richardson v. Hockenhall et al., 85 Ill. 124. In that case a quit claim deed was executed, while here, although a warranty deed was given, yet in that respect it gave to Burge no right he did not already have under his mortgage deed, which contained full covenants of warranty and waivers of the dower and homestead rights. On the other hand, it being a question of intention, the circumstances of this case are stronger in favor of appellees than were the facts of that case in favor of appellant, Bichardson. In that case, two days after the execution of the deed, not only was the mortgage released upon the record, but the note it was given to secure was surrendered; while in this case the entry of satisfaction wras not made until several years after the deed was delivered and possession taken, and both the note and mortgage were retained, and are yet held by Burge. The testimony of Burge and of George A. Lowman shows that the conveyance was made to save the costs of foreclosure, and because all the mortgaged property was not sufficient to pay the debt, and the mortgagors had no other property subject to execution. In Richardson v. Hockenliall it was held that, as there was a bare equity of redemption, which was released without any consideration except the discharge of the mortgage indebtedness, and the release was taken merely to save the trouble and expense of foreclosing, it would be unreasonable to believe, under the circumstances, it was the intention of Bichardson to give up his mortgage, and leave the property free and clear to be taken on judgments, which were a lien only on the equity of redemption. The case was distinguished by the court from Campbell v. Carter, 14 Ill. 286, and the court said that in the latter case, the equity of redemption was not the only consideration received; the mortgagee obtained the covenants of warranty of the mortgagor and a relinquishment of a dower interest in the property, which were regarded by the court as important facts in the decision of the case.” In the case at issue, as we have seen, the mortgagee received no consideration, other than the release of the equity of redemption, that he did not already have. Upon the authority of Richardson v. Hockenhall, we think the decree of the circuit court upon this point would be affirmed. Under the view we have taken of the rights of the parties, it is unnecessary to decide the third question suggested in the briefs of counsel, which involves the right of Burge to set off, in equ ity, the note of $400 given by Branson Bowman to Samuel Burge & Co. against the note and mortgage sought to he foreclosed.

The decree is affirmed.

Affirmed.


text:
    William R. Milligan v. Andrew J. O’Conor et al.
    1. Assignment — Statutory.—A valid assignment can now only be made under the statute, and when so m ide the estate must be administered and distributed substantially in conformity with its provisions, and all voluntary assignments for the benefit of creditors now stand on the same footing.
    2. Same — When it operates to hinder and delay creditors. — The placing of property in the hands of trustees or assignees for any other purpose than to enable them to distribute it or its proceeds among creditors must necessarily have the effect to in some degree hinder and delay creditors in the collection of their debts.
    3. Same — Release of judgment lien. — Where judgment creditors have the property levied upon turned over by their consent to trustees with po a er to continue business, etc., such action will operate as a release of the■ lien of their judgments, and will leave the prooerty open to the liens of subsequent judgment creditors who have taken no part in such proceedings and have not in any way consented thereto.
    4. General assignment for specific purpose not an equitable mortgage. — The arrangement in this case held, not to be an equitable mortgage, for it and the deed included a.ll the property of all kinds of the company, and had the effect of a general assignment, and not of a mortgage of, or trust placed upon, specific property.
    Appeal from the Circuit Court of Ba Salle county ; the Hon. O. Blalíchaed, Judge, presiding.
    Opinion filed June 8, 1886.

      Hr. E. D. HcDonald and Hr. Walter Beeves, for appe1* Jant;
    cited Hanchett v. Waterbury, Chicago Legal News, August 15, 1885; Bodley v. Goodrich 7 How. (U. S.) 276; Brown v. Parkhurst, 24 Ill. 257.
    Hr. Lester H. Strawn and Hr. James W. Duncan, for appellees;
    that courts will enforce an equitable assignment, cited Carr v. Waugh, 28 Ill. 418; Morris v. Cheney, 51 Ill. 451; Chapman v. Shattuck, 3 Gilm. 49; Hodson v. McConnel, 12 Ill. 170; Creighton v. Village of Hyde Park, 6 Bradwell, 272; Dehner v. H. F. & R. Hills, 7 Bradwell, 47.
   Baker, J.

This was replevin in the Circuit Court of La Salle county, prosecuted by appellees to a final judgment in said court in their favor against appellant, sheriff of the county.

The action was for certain horses, mules, wagons, beer kegs, beer casks, and other goods and chattels. The pleas of the sheriff alleged property in the Eliel Brewing Company, and justified under two executions, one in favor of James J. Vernon and the other in favor of the Streator National Bank.

In Hay, 1884, the Eliel Brewing Company, a corporation located at La Salle, was in debt to the amount of some $125,000, and was in failing circumstances, and its real estate was incumbered with a mortgage for $25,000. On the 19th day of that month judgments amounting in the aggregate to $18,-452.57 were entered against it by confession, and executions immediately issued and placed in the hands of the sheriff; and on the following day attachment suits for smns aggregating $16,046.54 were commenced against it, and the writs lev. Jed on the real estate.- Other suits and other judgments followed in the wake of these, including a judgment for $1,050 in favor of the Streator National Bank, rendered Hay 22, 1884, and a judgment in favor of James J. Vernon for $481.50, entered June '12th of that year. The executions issued upon the judgments of Hay 19th were on that day levied on the property of the corporation, with the exception of one execution in favor of Charles W. Holzheimer for §1,650, which was returned “no property found,” and made the foundation for a creditor’s bill, which was filed May 22, 188-1. There was a large ¡quantity of beer in process of manufacture, and the property of the company was otherwise in had shape to be realized upon, and on the 23d day of May, by common consent of the parties holding judgments or prosecuting suits against the corporation, a receiver was appointed by the court. The receiver took charge of the property and business of the company, but he had neither money nor credit, and was in no condition to carry on the business, and the creditors became anxious and dissatisfied.

In September, 1884, an arrangement was made between the Eliel Brewing Company and the principal creditors, whereby the levies made upon the executions of May 19th, and attachments of May 20tli, were abandoned, the creditor’s bill dismissed and the receiver discharged, the real estate of the company conveyed to appellees by deed, and an instrument in writing and under seal, bearing date September 16, 1884, executed both by the corporation and by appellees. The instrument stated that it had been agreed upon by the company and its several stockholders and creditors, that the business of the company should be put into the hands of appellees as trustees, to be managed for the benefit of the creditors. It then assigned to appellees in trust the certificates of shares of the capital stock of the company, and all its personal property, stock in trade, beer, materials for the manufacture of beer, bills receivable, accounts and other evidences of indebtedness, money in the hands of the receiver, and the accounts, notes and bills receivable due him as such receiver, and conveyed to them in trust all the real estate of the company. It then provided that the trustees should carry on the business of the company in such manner as should in their judgment he for the best interest of the creditors, and continue the same as long as profitable and until the creditors should be fully paid, unless in the judgment of the trustees it should be for the interest of the creditors sooner to close the same out; and that they should annually, if practicable, declare a pro rata dividend to each creditor from the profits of the business only for such amount as the profits of the business should in their judgment warrant and justify, leaving a sufficient sum in their hands to carry on the business successfully; and that when the profits of the business 'or the avails of the property and assets of the company should form a sufficient sum to pay all the creditors in full, then it should be the duty of the trustees to pay each creditor the amount due him, and reconvey to the company the real estate remaining unsold, if any, and all the personal property and choses in action in hand, and re-deliver to the several stockholders or their assigns the certificates of shares of capital stock belonging to them respectively, but that the trustee8 should not be required to carry on the business any longer than in their judgment should be for the interest of the creditors, they on the contrary being fully authorized to close out the business, and sell and dispose of all the assets and divide the avails of such assets among the several creditors pro rata whenever in their judgment it should be for the best interests of the creditors to do so, the trustees being the sole judges whether the business should be closed out before the creditors could be paid in full. The instrument also gave the trustees numerous other powers, and contained various other provisions unnecessary now to mention.

Appellees took immediate possession of all the property of the Eliel Brewing Company, and it being out of repair and in bad condition, they expended some $46,000 in repairing the buildings, casks and vats and in buying new kegs and material of various sorts, all of which has been paid but about twelve or thirteen thousand dollars. On the 18th of December, 1884, an execution was issued on the judgment in favor of James J. Vernon and against the company, and on the next day an execution was issued on the judgment in favor of the Streator National Bank against the company, and on the 23d of said December appellant levied these two executions upon the personal property in controversy, and which was at the time in possession of appellees. Vernon and the Streator National Bank were not present or represented at the meeting or meetings that resulted in the arrangement between the company and its creditors. They were, however, notified the meetings of the creditors would be held, and invited to attend the same, and were afterward informed of the arrangement made, but did nothing either in affirmance or disaffirmance of such arrangement prior to the suing out of their executions in December.

As Vernon and the bank did not attend or participate in the meetings of the creditors, or give their assent to the action taken whereby the property of the Eliel Brewing Company- was assigned or transferred to appellees, they are not bound by such transfer or assignment, unless either it was valid in law, or their conduct with reference to it, or the property, or the other parties in interest, has been such as to preclude them from now objecting. The act of May 22, 1877 (Laws of 1877, p. 116), concerning voluntary assignments, professes upon its face to be applicable to all cases of such assignments thereafter made for the benefit of creditors, and its provisions seem to cover the whole ground or entire subject-matter.

This is the view taken by the Supreme Court of the State. In Hanchett v. Waterbury, Chicago Legal Mews, Aug. 15, 1885, that court said, in speaking of this act, that it was essentially in its framework and detail a general insolvent law, and so intended by tin-, legislature; that a valid assignment can now only be made under the statute, and when so made the estate must be administered and distributed substantially in conformity with its provisions, and that all voluntary assignments for the benefit of creditors now stand on the same footing. Id Freydendall et al. v. Baldwin et al., 103 Ill. 325, the court held that by this statute the whole management of the estates of insolvent debtors, under voluntary assignments, is committed to the jurisdiction of county courts.

If the writing here in question is to be regarded as a voluntary assignment, it is very plain it is not in conformity with the requirements of the statute ; it allows the assignees to continue the business of the insolvent corporation, and in the name of that corporation, for an indefinite period, and pay dividends to the creditors only when and to such amounts as they see fit; and it takes the control of the insolvent estate wholly out of the hands of the county court, and places it beyond the reach of creditors, and leaves it entirely optional with the assignees whether the business shall ever be closed out or the property and assets sold and disposed of, and the proceeds applied in payment of the debts; and,- after the assignees have carried on the business for an indefinite period and paid all debts, it provides that the real estate unsold, and all the personal property and choses in action, shall be returned to the company, and the certificates of shares in the capital stock of the corporation re-delivered to the several stockholders. These and other extraordinary powers not allowed by the statute are given by the writing und.r consideration to the trustees or assignees, and at the same time they are freed from the necessity of giving a bond, as is required by the statute, for the security of the creditors, and are relieved from the various restrictions imposed by the act for the purpose of guarding the interests of such creditors.

Without any reference to the circumstances of its nonconformity with the requirements of the statute now in force, the deed of trust or assignment was void as to the creditors not consenting thereto, as tending to delay, hinder and defraud such creditors. The placing of property in the hands of trustees or assignees for any other purpose than to enable them to distribute it or its proceeds among creditors must necessarily have the effect to, in some degree, hinder and delay creditors in the collection of their debts. Gardner v. Commercial National Bank, 95 Ill. 298, is a case analogous to this, and the powers there conferred upon the trustees by the deed of assignment were substantially those conferred by the deed here involved, and it was held the deed was void as against creditors.

It is suggested by appellees that the reason why an assignee may not be invested with full and unlimited powers to continue the business of the assignor is, that it acts as a fraud upon the creditor in hindering and delaying him, and it is urged that in the ease at bar the reason of the rule fails and the rule itself should not be applied. In that connection it is insisted that all the property of the Efiel Brewing Company was covered by executions and by other liens which were first liens upon and sufficient to exhaust it; and that neither the Streator National Bank nor Vernon could in any event he damaged by the arrangement that was made for the transfer of the property to appellees. The answers to this suggestion are several. In the first place, we do not understand the evidence as showing that as matter of fact the value of the property levied upon was not more than sufficient to pay the liens upon it, but that in the condition the property was in, and under the circumstances surrounding it, it could not, in the opinions of the witnesses, have been sold for more than enough to pay those liens; non constat that the bank and Vernon would not have taken steps, in order to let in their own judgments, by which the property would have sold for its full and actual value.

They also had the right to test the validity of the liens and of the claims upon which they were founded. They might have found other property which had not been levied bn, if all the personal property of whatever kind and nature, and all the real estate whatsoever of the brewing company, had not been transferred and conveyed to appellees. The creditors wl^o held the first lien upon the personal property of the company by virtue of their executions and the levies thereon, voluntarily abandoned their levies and waived their rights under the executions, without having been induced to do so by any act or request on the part of either the bank or Vernon, and the circumstance of this formerly existing lien is no longer a fact to be considered in determining the validity ot the deed of assignment from the company to appellees, none f whom were plaintiffs in any of the executions that had been levied. At most the matter suggested has reference only to an equity supposed to exist as between the creditors whose executions were levied and the bank and Vernon; and it throws no light upon the question of the legal title of appellees to the property involved in this controversy. The assignment being the voluntary act of the assignors, the assignees represent simply the assignors and not the creditors in respect to the title to the assigned property; and they stand in no priority to the creditors, and can not arrogate to themselves any of the attributes or rights of the creditors. Twelves v. Williams, 3 Wharton, 485; Vandyke v. Christ, 7 Watts & Serg. 373; Housel v. Cremer, 13 Neb. 298.

It is also urged that courts of law will recognize and enforce an equitable mortgage when the mortgagee is in possession; and that this transaction amounted to an equitable mortgage in favor of the .creditors who held prior liens, and that they have possession through appellees as their agents. We think that the arrangement made between the creditors and the brewing company, by virtue of which the deed of trust was made to appellees, can not he regarded and sustained as an equitable mortgage, for the arrangement and deed included all the property of all kinds of the brewing company and had the effect of a general assignment, and not of a mortgage of or trust placed upon specific property.

The mere fact that the Streator National Bank and Vernon gave no notice of objection to what had been done, and failed to sue out executions upon their judgments until some three months after the assignment was made, did not have the effect of estopping them from claiming that which they now claim. As they were not parties to the arrangement that was^nade, and have done nothing that would work an'estoppel, we think the assignment was fraudulent and void as to them, they being creditors of the brewing company.

In our view, the justification pleaded in bar of the action by appellant was established by the evidence.

The finding and judgment of the circuit court having been otherwise, that judgment is reversed and the cause remanded.

Reversed and remanded.