text:
    William Reeda, Appellant, v. The Tribune Company, Appellee.
    Gen. No. 25,596.
    1. Newspapers, § 6

      —what is extent of liability of newspaper. Newspapers are responsible to the law for any wrong committed by them and are subject to regulation by law.
    2. Equity, § 1*—what is effect of maxim allowing remedy far wrong. The maxim that “where there is a wrong, there is a remedy," is not controlled in its application by the novelty of the question involved.
    3. Damages, § 96*—what is essential to award of punitive damages. There must be a finding of actual damage and an assessment therefor before there can be an assessment of punitive damages; the latter are assessable only where the former are recoverable.
    4. Newspapers, § 6*—what are duties and powers of newspapers. A newspaper, in the dissemination of matters of public interest, has a right to abandon any department it may have established or to add new ones or to change its policy, political or otherwise, at its pleasure and as to it may seem best for either its' own or the public weal.
    5. Newspapers, § 6*—when newspaper may refrain from publishing article. A newspaper is free to refrain from publishing such matter as it may determine to be without news value and to publish such matters as it regards as having news value, as long as it does not publish libelous or scandalous matter or matter forbidden by law.
    6. Newspapers, § 6*—when newspaper is not liable for failure to publish news. A newspaper owes to a candidate for political office no duty to publish the fact of his candidacy, and the fact that it fails to mention his name although it gives the names of the other candidates for such office does not subject it to a suit for damages in any form of action.
    7. Damages, § 154*—what must be pleaded to recover damages.. There cannot be a recovery in any form of action on the case unless damage is clearly inferable from the grievance alleged.
    Appeal from the Circuit Court of Cook county; the Hon. John P. McGoorty, Judge, presiding. Heard in this court at the October term, 1919.
    Affirmed.
    Opinion filed April 12, 1920.

      William Beeda, pro se, and Harry H. Krinsky, for appellant.
    McCormick, Kirkland, Patterson & Fleming, for appellee; Howard Ellis, of counsel.

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

   Mr. Justice Holdom

delivered the opinion of the court.

To the declaration and an additional count thereto a general demurrer was interposed and the court after hearing arguments thereon sustained the demurrer.

Plaintiff electing to stand by his declaration, the suit was dismissed at plaintiff’s cost and he prosecutes this appeal,

Plaintiff’s briefs are interesting but not enlightening on the subject before- us. His reply brief metaphorically puts the court “all at sea” by the making of his statement: ‘ ‘ The declaration does not proceed on the theory of slander or libel or an action on the case for false words causing damage, but proceeds on the theory of the common law that there is no violation of a right without a remedy.” Prior to being thus informed we had concluded, from an examination of the declaration, that the action was either “libel” or for “false words causing damage.” However, we will proceed to decide the case according to the latest pronundamento of plaintiff as to what the action really is.

It appears from plaintiff’s declaration that an election of twelve judges of the superior court of Cook county was to be held on November 6, 1917; that the Bepublican and Democratic party managers agreed upon twelve candidates owing allegiance respectively to said parties; that the party known as the Socialist party also nominated a ticket of twelve candidates; that thereupon as a rebuke, as plaintiff claims, to the bi-partisan methods of the two controlling political parties, he was with eleven others nominated for a superior court judgeship on what was termed an “independent judiciary by petition” ticket. The Board of Election Commissioners issued specimen ballots in the month of October prior to the election, with the names of all of the candidates thereon; and on October 31, 1917, defendant, publishing the Chicago Daily Tribune, printed in its issue of that date what purported to be a facsimile copy of the specimen ballot, but the same contained only the nominees appearing upon the tickets designated as the Republican, Democratic and Socialist parties and did not print or publish that part of the specimen ballot known as “independent judiciary by petition,” and wholly omitted ftfom such publication the name of plaintiff as one of the nominees for said judgeship; and plaintiff alleges that the actions of defendant in this regard were wilful and malicious, etc., and done, with intent to hinder and injure the candidacy of plaintiff to his damage.

Plaintiff appears in this court as his own attorney and, while he has an associate for counsel, we will assume from the personal tone adopted that the briefs are his own production.

In his reply brief plaintiff states that “appellant is not embittered by. defeat, because he had no hope of victory,” and continues: “This action is not conceived in spite, but is dedicated to the proposition that a newspaper must be made accountable for the violation of common ordinary rules requiring honest and fair dealing; that the great power for good or evil which it wields is and should be made subject to the regulation of the law.”

That newspapers are responsible to the law for any wrong committed by them and are subject to regulation by law is not open to controversy. It is the boast of the law as administered in our courts that it affords a remedy for the perpetration of any wrong against, any citizen. In other words, it is a maxim of the law that “where there is a wrong there is a remedy.” However, the novelty of the question does not affect the legal right. In a note to 38 Cyc. 423, appears the following:

“While no precedent is cited for such an action, it does not follow that there is no remedy for the wrong, because every form of action when brought for the first time must have been without a precedent to support it. Courts sometimes of necessity abandon their search for precedents and yet sustain a recovery upon legal principles clearly applicable to the new state of facts, although there was nó direct precedent for it, because there never had been an occasion to make one. The question, therefore, is not whether there is any precedent for the action, but whether defendant inflicted such a wrong upon plaintiff as resulted in lawful damages. Kujek v. Goldman, 150 N. Y. 176.”

It may be admitted that the case before us is novel and without precedent—at least no precedent on the facts is cited to us and none on an independent search is found; but this is a tort case wherein .plaintiff contends that defendant wronged him in the circumstances heretofore recited. However, a tort presupposes damages, but plaintiff repels the idea of damages because, he says, he “had no hope of victory,” although he argues that he is entitled to punitive damages. It is elementary law that there must be a finding of actual damage and an assessment therefor before there can be an assessment of punitive damages. Punitive damages are assessable only where actual damages are recoverable.

• Plaintiff contends that defendant as the publisher of a.newspaper is a public utility and is compelled to serve the public in the same manner as a public utility corporation, which in effect it is argued it is. However, we do not think that the question of whether a newspaper is a public utility is necessary for us to decide in the conclusions at which we have arrived, as we place our decision upon other grounds.

Plaintiff argues that because defendant maintains in its newspaper several departments offering advice to soldiers and to the public in general, a legal department' offering legal advice to the public, a medical department offering medical advice, and also a department offering advice to the “lovelorn,” that therefrom its business is impressed with a public character, and having once entered upon the operation of such departments, it is, inferentially at least, bound to maintain them.

We are unable to quite grasp this idea, because it is clear, we think, that what is of paramount interest to newspaper readers today may be obsolete some time in the future, and that a newspaper in the dissemination of matters of public interest has a right to abandon any department it may have established or to add new ones or to change its policy, political or otherwise, at its pleasure and as to it may seem best for either its own or the public weal.

According to plaintiff’s argument, defendant is liable not for what it did, but for what it refrained from doing. Such is indeed a novel proposition. To make defendant liable for its silence, we must hold that it was obligated to publish in its paper the whole of the facsimile judicial ticket. This we are not prepared to do. On the contrary, defendant owed no duty to either plaintiff or the public to publish anything which for any reason it did not see fit to publish. Defendant is the sole judge of the value of news as such. A newspaper must remain free to publish such matters as it regards as possessing news value and to refrain from publishing such matter as it may determine does not possess news value. In other words, it must be the judge of the conduct of its own business and of the news which it prints, as long as it does not offend against the law by publishing libelous or scandalous matter or matter forbidden by law, such as indecent matter or matter which would under the law make it liable to prosecution at the hands of the public prosecutor. Therefore we are confronted with this situation: Defendant might have refrained from publishing any portion of the facsimile judicial ticket on the occasion in question if it saw fit, or it might have published, as it did, sucfy portion thereof as it saw fit, it being the sole judge as to which portion it should publish. Defendant owed plaintiff no duty to announce to the public in its newspaper that plaintiff was a candidate for any office, and the fact that it did not mention plaintiff’s candidacy for the judgeship did not subject it to a suit for damages in any form of action.

As plaintiff claims that his declaration is not in libel or for false words causing damage, we refrain from the discussion as to whether or not the declaration is sufficient to fulfil by its averments the requisites of a declaration in either of these forms of action. However, we are unable to reconcile the averments of the declaration with the rule of the common law that “there is no violation of a right without a remedy.” An examination of the authorities cited by plaintiff not only fails to support such contention as applicable to the facts averred, but there is no case of which we are aware that permits a recovery in any form of action on the case unless damage is clearly inferable from the grievance alleged.

We are of the opinion that the declaration states no cause of action and that the trial judge properly sustained the general demurrer interposed to it; so holding, it follows that the judgment of the circuit court must be affirmed.

Affirmed.

Mr. Justice McSurely took no part; Me. Justice Dever concurs.


source: Caselaw Access Project

author: Mr. Justice Holdom

license: Public Domain

text:
    Minnie Crawley, Appellee, v. Tomkins D. Jermain, Appellant.
    Gen. No. 25,633.
    -1. Roads and bridges, § 231

      —what care must be exercised when driving on sidewalk. Pedestrians have a right of way upon a sidewalk, and one who drives a vehicle over such sidewalk is obligated by law to do so in a careful way so as to avoid injuring pedestrians lawfully using the sidewalk.
    2. Roads and bridges, § 231*—what constitutes negligence in driving across sidewalk. That one backing his automobile from a private roadway across a sidewalk at an excessive speed blew his horn as a signal and did not know that a pedestrian using the sidewalk was deaf and had somewhat impaired .vision does not relieve him from liability for injury to such pedestrian.
    3. Municipal corporations, § 1061*—right to assume safety of sidewalk. A pedestrian on a sidewalk has the right to assume that the sidewalk is safe from the danger of automobiles passing across it and that it is as safe in this regard for a pedestrian having impaired sight and hearing as for one having unimpaired faculties.
    4. Municipal corporations, § 1098*—when negligence of person driving automobile across sidewalk. In an action by one to recover for injuries received through being struck by defendant’s automobile as defendant was backing it across the sidewalk, defendant’s admission that he did not know of the accident until after it had happened is cogent evidence that he was operating the automobile in a negligent manner.
    5. Municipal corporations, § 1060*—right of pedestrian to use sidewalk. A pedestrian using a public sidewalk at a point where it is intersected by a private driveway is not a trespasser.
    Appeal from the Superior Court of Cook county; the Hon. Hugo Pam, Judge, presiding. Heard in this court at the October term, 1919.
    Affirmed.
    Opinion filed April 12, 1920.
    Charles S. Knudson, for appellant.
    McArdle & McAbdle, for appellee.

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

   Mr. Justice Holdom

delivered the opinion of the court.

In an action for personal injuries caused by defendant in running an automobile against the plaintiff and badly injuring her, plaintiff had a verdict and judgment for $2,000, and defendant appeals.

On the occasion in question plaintiff, an old lady whose sight and hearing were somewhat impaired and who was not familiar with the surroundings at the place of the accident, was, while walking upon the sidewalk, run into by defendant’s automobile and severely injured..

Tripp avenue, upon which the accident occurred, is a resident street in Chicago. Defendant, who resided on this street, kept his automobile in the rear of his lot and maintained a driveway from the street to the garage where he kept the car, driving the same across the sidewalk from his lot to the street when going out and conversely in returning.

Defendant proceeds upon an erroneous theory as to the rights of the parties at the time of the accident, contending that plaintiff was not in the exercise of due care because she did not so act as to avoid the accident.

It is clear from the testimony that defendant was in his environment operating his automobile negligently. He was backing it out, which to some extent obscured his vision of travel upon the sidewalk, whereas had he proceeded in a forward direction he would have had an unobstructed view of persons or objects which might have been in his path upon the sidewalk. Pedestrians have a right of way upon a sidewalk, and one who drives a vehicle oyer such sidewalk is obligated by law to do so in a careful way so as to avoid injuring pedestrians rightfully using such sidewalk. Defendant was not driving upon a street or a pri \ ate roadway at the time of the accident; moreover, he was proceeding at an excessive rate of speed, considering the fact that he was driving not upon a roadway but over the sidewalk, where it was to be expected pedestrians would be encountered. The fact that he did not know that plaintiff was somewhat deaf and her sight impaired does not militate in his favor nor in any way minimize his responsibility for the accident and liability to respond in damages therefor. It is beside the question that he was honking the horn of his car, because, aside from giving such a warning, it was incumbent upon him to proceed across the sidewalk cautiously so as to avoid running over pedestrians rightfully proceeding upon the same.

It is idle, in the circumstances of this case, to contend that plaintiff was not in the exercise of due care for her own safety; she had a perfect right to assume that the sidewalk was safe for her to walk upon and that it was as safe for a deaf and near-sighted person as it was for those whose faculties of sight and hearing were normal.

Defendant’s admission that he did not know of the accident until after it had taken place is cogent evidence that he was not proceeding with due care, but was operating his automobile in a negligent manner. The contention that plaintiff was a trespasser is fallacious; she was on the public sidewalk, where she had a right to be.

The special finding of the jury that plaintiff could not have avoided the accident by the exercise of ordinary care is, we think, abundantly sustained by the evidence and supports the general verdict of guilty.

Defendant’s argument that the testimony of plaintiff’s witnesses “did not ring true,” that they “dodged” and were not candid nor fair nor entitled to full faith and credit, is, we think, in the light of all the evidence, without force, because there is really no controversy upon the material facts which in law fasten liability upon defendant for the accident in suit.

An examination of the instructions does not disclose any infirmities in any of them justifying a reversal of the judgment.

Plaintiff’s injuries were very severe and the smallness of the verdict is cogent evidence of the fact that nothing occurred on the trial to afféct the minds of the jury to the detriment of defendant.

The judgment of the superior court does justice between the parties and is affirmed.

Affirmed.

Mr. Presiding Justice McSurely and Mr. Justice Dever concur.


author: Mr. Presiding Justice Thomson Mr. Justice O’Connor Mr. Justice Taylor

text:
    R. Stuart Adam, Administrator, Appellant, v. The Columbian National Life Insurance Company, Appellee.
    Gen. No. 24,827.
    1. Appeal and error, § 1733

      —what questions cannot be considered on subsequent appeal. Questions which were decided adversely to one by the decision on a former appeal cannot be reopened on the second appeal, as, on the second appeal matters decided on the former appeal bind both the parties and the appellate tribunal as far as concerns the particular case, and the operation- of this rule is not affected by such facts as are presented in the appellate tribunal on the second appeal for the first time.
    2. Appeal and ebrob, § 1734*—when question may be considered on subsequent appeal. On a second appeal contentions which were not involved on the former appeal may be passed upon.
    3. Insurance, §' 350*—when payment of premiums may be waived. The provision that a policy of life insurance will become void for nonpayment of any premium is inserted for the benefit of the insurer and the policy does not ipso facto become void upon such nonpayment, but the insurer may, at his option, waive such provision.

      4. Insurance, § 350

      —what constitutes waiver of forfeiture for nonpayment of premiums. If an insurer, by any act, statement or course of conduct towards the insured, recognizes his policy as existing and valid notwithstanding his failure to pay the premium when due, and gives him further time or urges him to pay, it will be held to have waived its right to forfeit the policy for nonpayment of the premium.
    5. Insurance, § 350*—necessity of clear intention to enforce forfeiture. Unless the circumstances show a clear intention of the insurer to claim a forfeiture of the policy for nonpayment of the premium, the clause providing therefor will not be enforced.
    6. Insurance, § 350*—when evidence shows waiver of forfeiture for nonpayment of premiums. In an action to recover on a policy of life insurance in which defendant contends that the policy was void for failure of the insured to pay the premium when due, the fact that the note given by the insured for the premium was not canceled and sent to defendant’s home office, as was its custom in case a policy lapsed; that the policy was carried on the insurer’s records as live; that the insurer repeatedly made unconditional demands on the insured for payment of the note with interest (though one demand requested also a health certificate) establishes that there was no intention on the insurer’s part to claim a forfeiture and establishes a waiver of the forfeiture.
    7. Waiver, § 1*—when waivef is equivalent to estoppel. Where all of the elements of an estoppel are present in a waiver, the terms may be used interchangeably.
    8. Insurance, § 321*-—when waiver is distinguished from estoppel. There may be a waiver of a condition in an insurance policy which waiver does not contain all the elements of an estoppel.
    9. Estoppel, § 43*—what is essential to constitute estoppel. To constitute the course of one an estoppel, it is essential that such course shall have been relied upon by another and that the latter shall have been induced by that course to act or refrain from acting so that he will be substantially injured if the former shall be allowed to repudiate his course.
    10. Insurance, § 321*—what are distinctions between estoppel and waiver. A waiver may depend upon what one himself intends to do, without regard to its effect upon the one claiming the waiver, while an estoppel necessarily depends upon what he causes the one claiming the estoppel to do or forego, in reliance upon his course.
    11. Waiver, § 1*—what is effect of waiver. A waiver established by virtue of what one himself intends to do, without regard to the effect which his course has upon the one seeking to establish the waiver, is binding notwithstanding the elements of an estoppel are not shown.
    12. Insurance, § 350*—what waiver of nonpayment of premiums is founded on. An implied waiver by the insurer of the exercise of the right to forfeit the policy for failure to pay a premium when due through his retention of and attempts to collect the note given for the premium is founded upon the doctrine, not that the insurer misled the insured to believe that his policy was in force, but that the insurer will not be heard to say that the policy was in force for the purpose of collecting the premium for a given period, and at the same time to say that it was invalid for the purpose of paying a loss incurred during such period.
    13. Insurance, § 321*—when insurer may not rely on forfeiture. While an insurer is not required to do affirmatively some act to accomplish a forfeiture where it has the right to a forfeiture, it will not be permitted, on the other hand, to do an act entirely inconsistent with a forfeiture and, at the same time, claim the forfeiture.
    14. Insurance, § 350*—what is effect of waiver of nonpayment of premiums. Where an insurer has waived the forfeiture of a policy for nonpayment of a premium and such is the status of the parties when the insured dies, the insurer’s liability becomes fixed without regard to any tender to it of the amount of the premium, ■ though such amount should be deducted from the amount called for by the policy.
    15. Insurance, § 329*—when insurer is bound by acts of agent. An insurance company is bound by the acts of its agent, if they are within the powers he is held out to the public as possessing.
    16. Insurance, § 350*—when insurer is bound by cashier’s acts as to waiving forfeiture. Where the evidence shows that the cashier in one of the offices of an insurance company acted within his authority in seeking to collect from the insured the payment of his note given for the premium on his policy, the fact that the cashier’s acts amounted to a waiver of the company’s right to forfeit the policy for nonpayment of the premium has no effect on the question of his authority to do the things he did.
    17. Insurance, § 323*—when act is within apparent scope of agent’s powers. In the absence of evidence to the contrary, the act of the cashier of one of the regular agency offices of an insurance company in demanding payment of a note given for a premium on a policy issued by the company must be held to be within the apparent scope of his authority.
    18. Appear and error, § 1810

      —when Appellate Court may enter-final judgment. On appeal by plaintiff from a judgment for defendant in an action to recover on a policy of life insurance, where the facts are not involved and there are no conflicting inferences to be drawn from them, and it is held that the denial of plaintiff's motion to direct a verdict in his favor was error, judgment for plaintiff may properly be entered in the Appellate Court.
    Appeal from the Circuit Court of Cook county; the Hon. Victob P. Abitold, Judge, presiding. Heard in the Branch Appellate Court at the October term, 1918.
    Reversed and judgment here.
    Opinion filed April 21, 1920.

      Certiorari denied by Supreme Court (making opinion final).
    John L. Hopkins and Donald J. De Wolfe, for appellant ; Albert L. Hopkins, of counsel.
    Holt, Cutting & Sidley, for appellee.

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

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

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

   Mr. Presiding Justice Thomson

delivered the opinion of the court.

The plaintiff administrator brought this action against the defendant company, seeking to recover the proceeds of a $5,000 policy of life insurance, which had been issued by the company to plaintiff’s intestate. The defendant took the position in the trial court that the policy had lapsed by reason of the failure of the assured to pay an annual premium and that it could only be liable for the paid-up value of the policy on the date said premium was due, with interest from that time, amounting in all to $632.54. The issues were submitted to a jury and they returned a verdict finding the issues for the defendant. Judgment was entered accordingly, from which the plaintiff has perfected this appeal.

The annual premium, amounting to $163, was due on the 6th day of December of each year. On that date in 1911, the premium was not paid. In the following February, the assured gave the defendant his note for the amount of the premium and the defendant gave him a receipt for it reading, “the premium due as set forth below has been settled this day.” The note was dated December 6, 1911, the date the premium was due and was for a period of six months and it recited, “this note is given with the full knowledge and intent on my part that if it is not paid when due without grace, said policy shall become absolutely null and void, subject to the legal conditions contained therein relating to cash value, paid up and extended insurance and in accordance with the conditions of this agreement without further notice.”

On the original trial of this case, the trial court excluded evidence offered by the defendant in explanation of the premium receipt given the assured in February, 1912, and directed a verdict for the plaintiff for the amount of the policy with interest. From the judgment entered on this verdict, the defendant appealed to this court and the judgment was reversed and the cause remanded for a new trial (191 Ill. App. 378). We there held that the court should have admitted the evidence which the defendant sought to introduce and that á receipt, not contained in the policy itself but purporting to acknowledge the payment of a premium other than the first, was merely presumptive evidence of payment and might be contradicted or explained by proof of other relevant facts and circumstances; that where the contract of insurance is already in force and is a continuing contract, requiring periodical payments to keep it alive and prevent forfeiture,^ and a receipt is given merely for the purpose of acknowledging payment of one of these subsequent premiums, a new contract is not thereby created, and there is nothing to prevent the application of the usual rule permitting receipts to be explained or contradicted by parol evidence.

On the retrial of the case the plaintiff made proof of the policy and the premium receipt for the year ending December 6, 1912, which was the receipt given the assured in February, 1912, when he executed the note referred to. Over plaintiff’s objection, the defendant introduced the note and also a health certificate furnished by the assured at the time he executed the note. It was shown that the note was extended a period of 60 days, making it mature August 5, 1912, and that upon such maturity the assured paid nothing on the note. In rebuttal, plaintiff introduced evidence, seeking to prove his contention that the defendant had waived prompt payment of the note and continued to treat the policy as alive and binding. It was shown that under date of August 12, the defendant’s cashier wrote the assured, calling his attention to the fact that his note was due on August 5, and saying, “Kindly let us have your check to cover these items (principal and interest) and oblige.” No attention being paid to this letter, the cashier wrote the assured on September 20, again calling attention to the fact that the note “is still unpaid. As this is over 30 days due, will ask that you kindly fill in the enclosed declaration of good health and return with your remittance, and oblige.” Still the defendant heard nothing from the assured and again, on October 16, the cashier wrote him that his note of $163 “is still unpaid. The amount of interest on same to date is $6.79. Kindly let us have your check for the above amount. ”

It was further shown that it was the practice of defendant to send such premium notes to its home office in Boston when the policy was considered lapsed. Such was not done with the note in question and the policy continued to be carried on the books of the company as a live policy and not as one which had lapsed. The assured died on November 3, 1912, leaving the note unpaid.

These facts are not disputed. The plaintiff claims on the one hand that there was a waiver by defendant of any right it may have had to a forfeiture of the policy and that it had not lapsed but was in full force at the time the assured died and that the trial court erred in denying Ms motion requesting the court to direct the jury to find the issues in Ms favor and assess his damages at the full amount of the policy, and the defendant claims on the other hand, that not only was the verdict right but that the court should not have submitted the issues to the jury but should have directed the jury to return the verdict which it did return on its consideration of the case,—and that this verdict being the only one possible on the facts the judgment should be affirmed, notwithstanding plaintiff’s contentions as to erroneous instructions, in which defendant contends there was no substantial error.

In support of this appeal, plaintiff first makes certain contentions wMch were decided adversely to him upon the former appeal to this court. On those matters that decision is now binding in this case, both upon this court and the parties to the case, and we are precluded from again considering them at this time. People v. Powers, 283 Ill. 438; Warren Land Co. v. Chicago, St. P., M. & O. Ry. Co., 205 Ill. App. 425. These contentions of plaintiff to which we refer are in no way affected by such facts as are presented for the first time in this court, on this appeal.

But the plaintiff makes further contentions that were not involved on the former appeal and which a,re therefore such as this court may now pass upon.

On the first appeal of this case to this court we said that the mere fact that the note (given the defendant by the assured in February, 1912) was not canceled and returned by defendant, when the assured failed to pay it at maturity, could hot be held to be a waiver of the forfeiture of the policy, “if unaccompanied by any other fact or circumstance tending to prove that the company had retained at for the purpose of collecting it as an independent obligation.” In our opimon, the evidence introduced on the retrial of the case shows such facts and circumstances accompanying the retention of this note by the defendant as clearly prove that they did retain it for the purpose of collecting it.

The clause in the policy providing that it would become void for nonpayment of any premium was obviously put there for the benefit of the insurance company. The policy did not ipso facto become void if a premium fell due and was unpaid. In such event the company would have a right to claim a forfeiture of the policy or, if it saw fit, it might waive that right and give the assured further opportunity to pay the premium. If the company, by any act or statement or course of conduct toward the assured, recognized the policy as existing and valid and expressly gave the assured further time for the payment of the premium or urged his payment of it, it will be held to have waived its right to a forfeiture of the policy. Unless the circumstances show a clear intention to claim a forfeiture, it will not be enforced. Chicago Life Ins. Co. v. Warner, 80 Ill. 410; Manufacturers’ & Merchants’ Ins. Co. v. Armstrong, 145 Ill. 469; Conductors’ Mut. Aid & Benefit Ass’n v. Tucker, 157 Ill. 194; Illinois Life Ass’n v. Wells, 200 Ill. 445; Bennett v. Union Cent. Life Ins. Co., 203 Ill. 439. In our opinion the fact that the note was not canceled and sent to the defendant’s home office, as was the custom of the defendant in case a policy lapsed; that the policy was carried on defendant’s records as a live policy and not one that had lapsed; and especially the fact that defendant repeatedly made- unconditional demands on the assured for payment of the amount of the note with interest (the fact that one of those demands includes a request for a health certificate does not change the situation), clearly shows there was no intention on the part of the defendant to claim a forfeiture and establishes a waiver of its right to a forfeiture of the policy. Lane v. Yeomen of America, 125 Ill. App. 406; Union Cent. Life Ins. Co. v. Bur nett, 136 Ill. App. 187; Chicago Life Ins. Co. v. Warner, 80 Ill. 410; Grand Lodge A. O. U. W. v. Lachmann, 199 Ill. 140; Illinois Life Ass’n v. Wells, 200 Ill. 445; Williams v. Empire Mut. Annuity & Life Ins. Co., 8 Ga. App. 303, 68 S. E. 1082; Fidelity Mut. Life Ins. Co. v. Goza, 13 Ga. App. 20, 75 S. E. 735; Fidelity Mut. Life Ins. Co. v. Price, 117 Ky. 25, 77 S. W. 384; New York Life Ins. Co. v. Evans, 136 Ky. 391. In contending the contrary, counsel for defendant has called our attention to many authorities. The three cases cited from the reports of our own State, Phoenix Ins. Co, v. Carlock, 32 Ill. App. 255; Weston v. State Mut. Life Assur. Co., 234 Ill. 492, and Roberts v. Ætna Life Ins. Co., 212 Ill. 382, are, in our opinion, clearly distinguishable from the case at bar on the facts involved. The issue presented here was not involved in any of those cases.

In the Carlock case both the policy and the premium note involved, provided that if the note was not paid at maturity the policy would then become null and void and so remain until the note was paid in full. The note provided that in case of loss the note should immediately become due and payable and be deducted from the amount of the loss. The policy also provided that “no legal action on the part of this company to enforce payment (of the note) shall be construed as reviving the policy:” The premium note involved in that case was renewed' several times. It was never paid. About a year and a half after the last extension and after the last correspondence between the parties, the loss sued upon occurred. On the first trial of the case the assured recovered. On appeal to the Appellate Court for the Third District the judgment was reversed and the cause remanded for a new trial. On the retrial of the case the defendant secured a judgment and on appeal to the Appellate Court the judgment was affirmed. 38 Ill.. App. 283. In that decision the court said: “Had the loss occurred while the payment was suspended by the extensions granted ' * * * another and a very different case would be presented,” but the court held that in view of the facts involved in the case, it would not be a fair construction of the contract and the conduct of the parties to say that a waiver of the forfeiture could be implied. The court referred to the Warner case, 80 Ill. 410, and said it was not controlling “because depending upon wholly different facts.” We elsewhere refer to that case as one which does apply to the situation presented in the case at bar. On appeal from the last judgment of the Appellate Court in the Carlock case to the Supreme Court, that judgment was affirmed (138 Ill. 210), the Supreme Court saying: “The case is quite different from one in which, by the terms of the contract, the failure to pay the premium works a forfeiture of the policy. In that case, since there can be no liability to pay the premium, where there is no liability upon the policy, the acceptance of the premium is an implied admission of liability upon the policy.” It seems queer that an unqualified demand for the premium or the full amount of the premium note would have a like effect.

In the Weston case the loss occurred after the time covered by the note there involved had expired and after the defendant’s request for a new note had been refused by the assured, the court holding that the facts showed the assured understood he was giving up the insurance. In the Roberts’ case, term insurance was provided, for successive terms of 2 months each, and under the contract there would be no insurance for a given term until the note given for the premium for that term was paid. The court said: “The case in this respect stands on a footing different from one in which failure to pay the premium merely gives the insurer the option to forfeit the policy and terminate the insurance. Here the insurance would not come into existence unless the payment was made, and to bring it into existence required some act on the part of the insured equivalent to the satisfaction of the note or an extension of the time of payment. ’ ’

Likewise, the issue presented in the case at bar was not at all involved in some of those cases decided in other jurisdictions, to which counsel for defendant has called our attention. It is impossible to analyze them all here. In some of them, payment of the overdue premium note was not only demanded by the company but was refused by the assured; some of them involved provisions contained in the policy of insurance or the note which are materially different from those contained in the policy and note involved here; and in some of them the decisions are based upon a failure to properly distinguish between an- estoppel in pais and an implied waiver. Following the latter authorities, defendant here contends that the waiver sought to be established by the plaintiff is in the nature of and equivalent to an estoppel and it is argued that the plaintiff has failed to establish it for there is no showing that the assured was misled into believing that his insurance was in force, by the demands defendant made upon him for the payment of his note after it had matured. This contention cannot prevail. There is a distinct difference between an implied waiver such as is urged under the facts here involved, and an estoppel in pais. There are, of course, different kinds of waivers. In some of them all the elements of an estoppel are present and in such instances it may be said that the terms may be used interchangeably. That was true in the case of Phœnix Ins. Co. v. Grove, 215 Ill. 299. In that case there was a condition in a fire insurance policy providing that it would be void if the insured procured other insurance on the property unless consent to that effect were indorsed on the policy in writing by the company. The assured did procure other insurance and notified the company he had done so. No written consent was indorsed on the policy but the company did not exercise the right of cancellation or forfeiture, but continued to treat the policy as alive and led the plaintiff to believe they were so treating it, and it was held that the company could not avoid the payment of a loss on the ground that the plaintiff had violated the condition referred to because it had waived the condition. There the waiver involved contained all the elements of an estoppel and the two terms might be used interchangeably as the court there said “as applied to such a case as this.”

But there may be a waiver of a condition in an insurance policy which waiver does not contain all the elements of an estoppel. Beggs v. Supreme Council, 146 Ill. App. 168. Where the course of one amounts to an estoppel, one of its essential elements is that such course must have been relied upon by another and the latter must have been induced by that course, to act or to refrain from acting so that he mil be substantially injured if- the former should be allowed to repudiate his course. 11 Amer. & Eng. Encye. of Law, pp. 387, 421 and 436; Powers v. Wells, 244 Ill. 558. But the conduct of the company may be less than that and yet amount to a waiver of its right to the forfeiture of a policy. It is generally true that the term “waiver,” besides implying an intention on the part of the company (applying the principle to the situation before us) to relinquish a right, which is not necessarily present in an estoppel, refers only to the act or the consequence of the act of the company, •—the party against whom the waiver is sought to be enforced,—regardless of the attitude assumed by the other party (the assured) whereas estoppel in pais arises where, by the fault of one party (the company) another (the assured) has been induced, ignorantly or innocently, to change his position for the worse, in such manner that it would operate as a virtual fraud upon him to allow the party by whom he has been misled (the company) to assert the right in controversy. 29 Am. & Eng. Encyc. of Law, 1092. In other words, a waiver may depend upon what one himself "intends to do, without regard to its effect upon the one claiming the waiver, while an estoppel necessarily depends upon what he causes the one claiming the estoppel to do or not to do, in reliance upon his course. There is a clear distinction between that kind of a waiver and an estoppel, and where such a waiver is made out, the defendant will be held liable although the elements of an estoppel are not shown to be present. There are numerous examples of it in the decisions of our courts in insurance cases. An implied waiver of the exercise of the right to a forfeiture under the terms of an insurance policy, under such facts as are involved here, is founded upon the doctrine, not that the company has misled the insured into a belief that his policy was in force, but that the company will not be heard to say that its contract is valid for the purpose of collecting the premium for a given period, and at the same time assert that it is invalid for the purpose of paying a loss incurred within that period. It will be remembered that the note defendant was seeking to induce the assured to pay, when it sent its communications referred to, covered the premium for the year up to December 6,1912-, ■ and that the insured died in November of that year.

In Cox v. American Ins. Co., 184 Ill. App. 419, which was a fire insurance case, the acts of the company which the court construed as a waiver on its part to 'declare a forfeiture of the policy took place after the loss had occurred, of which latter fact the company had full knowledge. The court said in discussing the waiver there involved: “A waiver of a breach of a condition of a policy, does not require the company to do anything to the disadvantage of the assured.” In Illinois Life Ass’n v. Wells, 200 Ill. 445, the same situation was present except that it does not appear in that case that the company knew the assured was dead when they made the statements and committed the acts that the court construed as a waiver, but the court said in that case that whether the company knew that the assured had died or not could make no difference as to the competency of the testimony going to establish the facts constituting the alleged waiver or as to its legal effect. Also in Chicago Life Ins. Co. v. Warner, 80 Ill. 410, the things which the court held amounted to a waiver on the part of the company or its right to declare a forfeiture of the policy, took place after the loss had occurred. In none of these cases was an estoppel established or involved but in all of them the courts held the defendant had waived its right to a forfeiture.

The case of Schimp v. Cedar Rapids Ins. Co., 124 Ill. 354, is one in which the facts involved were not such as are presented here, for in that case the facts relied upon by the plaintiff to constitute a waiver by" the company of a forfeiture of the policy, occurred long after the risk under the policy had terminated and after defendant had refused payment of the loss, and the court held that the facts in question did not constitute a waiver by the company and that the doctrine of waiver did not apply to the facts in the case. But the court, in that case, announced in clear terms the nature of the sort of waiver that is here being urged. The court referred to it as an implied waiver and said: .

“This class of waivers is frequently to be met with in the law of insurance. Thus, where the assured has been guilty of some breach or breaches of the conditions of the policy, and the insurer, with full knowledge thereof, during the pendency of the risk, accepts a maturing premium, or does any other act recognizing the continued existence and validity of the policy, such acceptance or other act will operate as a waiver of the right of forfeiture occasioned by said breaches, unless something appears to show that it was not intended to have that effect, and that the assured so understood it. This well recognized rule in the -law of insurance is founded, at least in part, upon the fundamental principle, that one having the exclusive right to terminate an executory contract, must abrogate it altogether, if at all. He cannot be heard to say it is valid for one purpose, and, in the same breath, that it is invalid for all other purposes, but it is founded chiefly upon the general principles of common honesty and natural justice, which the law exacts of mankind in their intercourse and dealings with one another.”

The court then proceeded to say, as we have already pointed out, that the doctrine of waiver had no application whatever to the facts of that case, and also held that the facts were not such as to create an estoppel against the company and in that connection the court used the following language, to which the defendant in the case at bar has called our attention (p. 357): “The waiver or estoppel relied on cannot prevail. It is destitute of that element which is most essential to either. It does not appear, nor is it claimed, that the assured has been misled in any manner, to her prejudice, by the company accepting payment of the note. ’ ’ In announcing this as an element of waiver generally, as well as of estoppel, the court was hardly consistent with the language it had previously used in the same opinion, which language we have quoted above.

Counsel for defendant have also called our attention to Northwestern Mut. Life Ins. Co. v. Amerman, 119 Ill. 329; Dwelling House Ins. Co. v. Dowdall, 159 Ill. 179; and United States Life Ins. Co. v. Ross, 159 Ill. 476. In these cases the facts were such as to create an estoppel. Counsel have also called our attention, in this connection, to Weston v. State Mut. Life Assur. Co., 234 Ill. 492, and Phœnix Ins. Co. v. Grove, 215 Ill. 299. In the Weston ease the facts were entirely different from those involved here. The assured gave the agent of the company his note to cover the premium for a specified period but failed to make any provision for the period following, during which the agent wrote him urging him to do something about it. The court pointed out that the assured did nothing further to keep his insurance in force and that the evidence showed nothing to indicate that he thought that it was in force. The court also held that the waiver of the payment of premiums by a company for a specified time is only valuable to the insured when payment is made or a loss occurs within that time. In the case at bar the loss did occur within the period for which the waiver is shown to have been made. The Grove case has already been referred to. It will be seen that in that case the facts set up were such as to amount to an estoppel.

In our opinion these cases cannot apply to the facts now before us. Here we have the company accepting the note of the assured, and giving him its receipt therefor, reciting that the premium on his policy for a given year has been “settled” and following his failure to pay the note at maturity we have the insurance company making these demands in writing for the full amount of the note with interest, one of these demands mentioning a health certificate and two of them being entirely without any such condition or reference, and then we have the death of the assured, —all occurring within the period covered by the premium in question. We hold that the doctrine of waiver, as applied to such a case as this (which is entirely different from those just referred to), is not that of estoppel in pais. Although it was not shown that the deceased postponed his payment of the note, in reliance upon a belief on his part that, because of the conduct of the defendant, it would not insist upon a forfeiture and although therefore an estoppel in pais is not made out here, nevertheless the facts do establish a waiver on the part of the defendant of the forfeiture of the policy. While the defendant is not required to affirmatively 'do some act to accomplish a forfeiture, where it has the right to a forfeiture, it on the other hand will not be permitted to do some act entirely inconsistent with a forfeiture and at the same time claim the forfeiture,—it cannot at one and the same time take the position both that the policy is in force, by demanding payment of the note, representing the premium for the full year and also that the policy is not in force by refusing to pay the amount it calls for when a loss occurs within that year.

In Freise v. Metropolitan Life Ins. Co., 206 Ill. App. 404, the court said that • forfeiture of life insurance policies are not favored and will never be enforced unless the evidence is clear that such was the intention. While in that case the court holds that where the conduct and dealings of the insurance company with the assured is such as to induce the assured to believe that a forfeiture will not be insisted upon, the company will be estopped from taking advantage thereof, it also holds that where it appears that, after the death of the assured, the beneficiary paid an overdue premium at the office of the company without saying anything about the death, and where the policy had not then been forfeited, the company would be liable. The latter holding of the court is based on the ground of a waiver by the company, and it will readily be seen that it in no way involved the elements of an estoppel, inasmuch as the facts constituting the waiver happened after the assured had died. The court gives as its reason for the latter ruling, the fact that the circumstances referred to were evidence that the company was not relying upon the failure to make prompt payment of the premium as a forfeiture of the policy. We have already referred to a number of other cases in this State where the facts were such that no estoppel could have been involved and yet the court held that a waiver on the part of the company was established.

The company having waived the forfeiture of the policy, and such being the status of the parties when the loss occurred, the company’s liability became fixed without regard to any tender to-it of the amount of the premium. The amount of the premiums should, of course, be deducted from the amount called for under the policy, as the language, of the policy itself provides.

There is a further contention that the authority of the cashier in the Chicago office of the company, who wrote the assured the letter's demanding payment of the note, was not such that his acts could amount to a waiver,—that he had no power or authority to waive a forfeiture. This contention is untenable. An insurance company will be bound by the acts of its agent, if within the powers he is held out to the public as possessing. Phenix Ins. Co. v. Hart, 149 Ill. 513; Phenix Ins. Co. v. Stocks, 149 Ill. 319; Continental Ins. Co. v. Ruckman, 127 Ill. 364; Electric Life Ins. Co. v. Fahrenkrug, 68 Ill. 463; Manufacturers’ & Merchants’ Mut. Ins. Co. v. Armstrong, 45 Ill. App. 217; Hodges v. Bankers’ Surety Co., 152 Ill. App. 372. The evidence clearly shows that the defendant’s cashier had full authority to do all he did in this case. The fact that his actions amounted to a waiver on the part of the defendant can have no effect on the question of his sauthority to do the things he did do.

If the cashier of one of the regular agency offices of such a company makes demand for the payment of a premium note, such action on his part, in the absence of evidence to the contrary, must be held to be within the apparent scope of his authority and such demand will be given its full legal effect.

In our opinion the trial court erred in overruling plaintiff’s motion to direct a verdict in his favor for the ^amount of the policy, $5,000, with interest thereon at 5 per cent from December 5, 1912, the date proof of death was duly made, less the amount of the note with like interest thereon from December 6, 1911 to November 23, 1912, the date on which the evidence shows the plaintiff tendered payment to defendant , on the note.

We are of the opinion that in such a case as the one at bar this court, upon reversing the judgment of the trial court, has the power to enter judgment here. The facts involved are not disputed and there are no conflicting inferences to be drawn from the facts. In City of Spring Valley v. Spring Valley Coal Co., 173 Ill. 497, it was held that this court had erred in entering judgment for the plaintiff upon a reversal of the judgment of the trial court for the defendant, as such judgment for the plaintiff, entered in this court, took away the right which the defendant had to a jury trial but in that case this court entered its judgment for the plaintiff on a finding of facts. By referring to the opinion of this court in the case cited (72 Ill. App. 629), it appears that in the trial of that case the plaintiff did not make a motion requesting the court to direct a verdict in its favor but, nevertheless, this court held that there being no controverted question of fact in issue “the trial court would have been entirely justified in directing a verdict for the plaintiff and no doubt would have done so if asked” and that in such a case this court could not be said to invade the province of the jury in rendering judgment for the plaintiff. But on appeal to the Supreme Court, that court said on this point, that although the plaintiff might have obtained a directed verdict in the trial court, it in fact did not make the motion for a directed verdict and stated that if the plaintiff “had done so the question presented would have been a different one from that presented under this finding of facts,” and in that situation the appellant might have had the proposition reviewed in the Supreme Court. The court goes on to say: “The right of a trial court to direct a verdict is one of the incidents of a trial by jury. The motion for such a direction raises a question of law, and the fact that a question of that kind might have been raised does not justify an assessment of damages upon a finding of facts. If it had been raised it could be reviewed in this court, while if judgment might be entered, as was done in this ease, upon the finding of facts, plaintiff would be deprived of the right to a review in this court.”

In the case at bar, the question of whether, on the admitted facts, the plaintiff was entitled to a directed verdict, as a matter of law, was raised, because the plaintiff did make his motion requesting the trial court to direct the jury to return a verdict in his favor, and inasmuch as we hold that the court erred in denying that motion, we are of the opinion that judgment for the plaintiff should be entered here. That course was followed in a similar situation' in Dean & Son v. W. B. Conkey Co., 180 Ill. App. 162.

For the reasons stated the judgment of the circuit court is reversed and judgment for plaintiff is entered here for the amount of the policy, $5,000, with interest at 5 per cent from December 5, 1912, to the date of the judgment here, $6,843.93, less the amount of the note, $163 with interest at 5 per cent from December 6, 1911 to November 23, 1912 ($170.87), or the total sum of $6,672.86.

Judgment reversed and judgment here.

Mr. Justice O’Connor

especially concurring:

I agree with the conclusion reached but not with what is said as to the distinction sought to be made between waiver and estoppel. It has long been held in this State, as applied to the law of insurance, that the two terms are used interchangeably. In Phœnix Ins. Co. v. Grove, 215 Ill. 299, Mr. Justice Cartwright in delivering the opinion of the court said (p. 302):

“The doctrine of waiver, as applied to such a case as this, is that of estoppel in pais. There is no substantial distinction between the two, and the terms are used interchangeably, a waiver being only another name for estoppel.” ' Citing Dwelling House Ins. Co. v. Dowdall, 159 Ill. 179, and 16 Amer. & Eng. Encyc. of Law (2nd Ed.) 935. In the latter citation the author says: “In Inany of the decisions attempted distinctions have been made between a waiver and an estoppel, it being contended that an implied waiver may arise from acts or conduct on the part of the insurer which do not create a technical estoppel. But it seems to be the prevailing opinion that the doctrine of waiver as asserted against insurance companies to avoid the strict enforcement of conditions contained in their policies is only another name for the doctrine of estoppel.” As authority for this proposition the case of Globe Mut. Life Ins. Co. v. Wolff, 95 U. S. 326, is cited. In that case Mr. Justice Field speaking for the court said: “The¡ doctrine of waiver, as asserted against insurance companies to avoid the strict enforcement of conditions contained in their policies, is only another name for the doctrine of estoppel.”

Mr. Justice Taylor

concurring:

I am in accord with the conclusion, but do not agree with the Presiding Justice on the subject of waiver and estoppel.


author: Mr. Presiding Justice Thomson

text:
    Henry Utpatel and Richard C. Mauer, Appellants, v. Chicago Title & Trust Company et al., Appellees.
    Gen. No. 24,884.
    1. Mortgages, § 175

      —what is effect of common law as to assignment of mortgage. The common-law rule that the assignee of a mortgage or trust deed takes it subject to all equities existing against the security in the hands of the mortgagee is the law of Illinois.
    2. Appeal and error, § 384*—necessity of objections ip court below. Semble that an appellant cannot urge in the Appellate Court- that a statute not mentioned by him in the trial court is fatal to his adversary’s contentions.
    3. Evidence, § 5*—what court will talce judicial notice of. The courts take judicial notice of all of the statutes of the State and render their decisions with such statutes in mind and will interpret and apply them to the facts of any case falling within them, whether or not the parties raise the question of the applicability of the statute.
    4. Statutes, § 274*—what statutes must be proved. All statutes in Illinois enacted since .1874, the date of the last revision, must be proven by the Session Laws certified by the Secretary of State or by copies thereof certified by the same officer.
    5. Statutes, § 274*—how statutes are proved. While an act which is included in the Sesssion Laws is prima facie a part of the statute law of the State, such evidence is not conclusive.
    6. Statutes, § 275*—when session law is not a part of law. Session Laws 1901, p. 248 (J. & A. H 7589) does not exist as a part of the laws of Illinois.
    7. Judgment, § 502*—what matters are concluded by former verdict. The verdict against defendant in an action at law brought against him on notes signed by him will not preclude him from setting up, on a bill to foreclose the trust deed given to secure such notes, the defense that the notes and trust deed were secured from him by fraud and were without consideration.
    8. Mortgages, § 405*—when equities are with defendant in suit to foreclose. On a bill to foreclose a trust deed given to secure notes, where it appears that the execution of the deed by defendant was obtained without his knowledge and by gross fraud which was not discovered by him until some months thereafter and the notes of defendant which it purported to secure were made on the representation of a real estate agent that they would enable the intending purchaser of the defendant’s property to complete the purchase of the property and that the agent sold such notes and trust deed to complainants, it was held that the equities were with defendant.
    9. Mortgages, § 176

      —what is duty of assignee of mortgage when purchasing. It is the duty of one purchasing notes secured by a trust deed to inquire of the maker if any reason exists why the incumbrance should not be paid, and on buying without such inquiry, he assumes the risk of such equities as may be in existence between the maker and the one from whom the purchase is made.
    Appeal from the Superior Court of Cook county; the Hon. Denis E. Sullivan, Judge, presiding. . Heard in the Branch Appellate Court at the March term, 1919.
    Affirmed.
    Opinion filed April 21, 1920.
    Ernest Saunders and Otto G. Kneoht, for appellants.
    Thurman, Hume & Kennedy, for appellees.

      See niinois Notes Digest, Vole. XI to XV, and Cumulative Quarterly, same topic and section number.

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

   Mr. Presiding Justice Thomson

delivered the opinion of the court.

This is an appeal by complainants from a decree dismissing their bill to foreclose a trust deed, for want of equity, and allowing the prayer of a cross-bill which sought to have the deed set aside and canceled.

One of the defendants, whose name is Mengel, owned the property in which he and his family lived. He desired to sell it and one Werner, a real estate broker, produced a prospective buyer whose name was Grander and ultimately the parties executed a contract of sale by the terms of which the latter agreed to pay $2,550 for the property. Some time later Werner went to Mengel and told him Grander did not have cash enough on hand to complete the purchase and was obliged to borrow $1,200 so as to pay Mengel the full purchase price in cash and Werner suggested to Mengel that he (Mengel) execute notes to that amount so that Grander could take them to the Chicago Title & Trust Company and get $1,200 from them on the notes and then be in a position to complete his purchase of Mengel’s property by paying him the full amount in cash, called for by the contract. Men-gel not only executed the notes but a trust deed conveying his property to the Chicago Title & Trust Company to secure the notes. Mengel was a foreigner and not very familiar with the English language. The decree entered in the trial court finds that he did not discover that one of the papers he had signed was a trust deed until 5 or 6 months later. Mengel received $100 as earnest money on his sale but nothing further developed, although he had turned his abstract of title and insurance policy over to Werner. Upon making some inquiries of Werner several months after the contract had been executed, Mengel was told that Grander had found it impossible to raise even $1,350 whereupon the contract was canceled. Mengel then asked Werner to give him back “his papers.” Werner put him off and Mengel went to a lawyer who investigated the situation and Mengel then learned for the first time that he had executed a trust deed on his property. Not being ablé to secure the return of the trust deed or the notes, Mengel had Werner arrested. It appears from the record that at the time of the hearing in this ease he had departed for parts unknown.

After getting possession of the trust deed and notes executed by Mengel, Werner, representing himself as the owner of the paper, sold it to these complainants for its face value less accrued interest and commissions. Default was made on the interest due on the notes, whereupon the complainants, Utpatel and Mauer, instituted these foreclosure proceedings and Meng-el filed the cross-bill to which we have already referred. After filing the bill in the suit at bar complainants sued Mengel at law on the notes and recovered a judgment and set those facts up here' by supplemental bill.

The common-law rule that the assignee of a mortgage or trust deed takes it subject to all equities existing against the security in1 the hands of the mortgagee, as laid down in Olds v. Cummings, 31 Ill. 188, and many subsequent cases, down through McAuliffe v. Reuter, 166 Ill. 491; Buehler v. McCormick, 169 Ill. 269; Bouton v. Cameron, 205 Ill. 50, and Peacock v. Phillips, 247 Ill. 467, is still the law of this State.

Complainants urge that the equitable defenses sought to be interposed in this foreclosure proceeding by Mengel are "completely barred 'by a statute appearing in the Session Laws of 1901 at page 248, which provides that whenever a mortgage, trust deed or other sucl> conveyance, is executed, conveying reál estate for the purpose of securing an indebtedness on the real estate mentioned in said conveyance, the conveyance shall be considered as incident to the indebtedness secured thereby and shall be exempt from defenses to the same extent as the negotiable paper described in the conveyance, if held by a bona fide purchaser for value before the maturity of the indebtedness in question. We have not been favored by any comment on this contention in the brief filed by appellees. The contention cannot prevail. The record discloses that no point was made of this alleged statute in the trial court but it is mentioned in this case for the first time in the brief filed by complainants.

While we think complainant might be barred from urging the statute referred to in this court for the first time, still, as this court pointed out in a recent decision we shall refer to in a moment, all decisions are made with the statutes of the State in mind, of which the courts take judicial notice. If the facts of any case fall within the statutory enactments, the court will interpret the statute and apply it to the case as the law. While foreign statutes, to be availed of, must be pleaded, domestic statutes are, at least, ihferentially in the mind of the court. There has been no revision of our statutes since the revision of 1874, —consequently all statutes passed since that time must be proven by "the Session Laws certified by the Secretary of State or by copies thereof certified by the same official. According to the Session Laws of 1901, the act in question is prima facie a part of the statute law of this State, although such prima facie evidence thereof is not conclusive. Spangler v. Jacoby, 14 Ill. 297; Prescott v. Board of Trustees of Illinois & M. Canal, 19 Ill. 323; Illinois Cent. Co. v. Wren, 43 Ill. 77; Grob v. Cushman, 45 Ill. 119.

While the act appears in the Session Laws of 1901 (J. & A. ft 7589), it has never been included, in any of the editions of Hurd’s Statutes. Preceding the act, as it appears in the edition of the Statutes by Jones & Addington, is a statement reading in part: “It is said upon good authority, and the records at Springfield seem to support the statement, that the above (entitled) Act was never passed by the House of Representatives.” . The same comment is made as to this act where it appears in 4 Starr & Curtis, p. 891. In the case of Schott v. Horney, 201 Ill. App. 10, this act was invoked and the question of its validity was raised in the case for the first time when the case reached the Appellate Court for the Third District, and the court reversed the decree which had defeated the foreclosure sought, on the equitable defenses interposed by defendants, and remanded the cause so that the question of the validity of the Act of 1901 referred to, could be tried out and determined. That case does not again appear in the published reports of the Appellate Court nor in the reports of the Supreme Court since that time.

However, the question of the validity of the statute has been raised in our Supreme Court in the case of Bartholf v. Bensley, 234 Ill. 336, in which case, as well as a number of others, decided by the Supreme Court since 1901, including Zollman v. Jackson Trust & Savings Bank, 238 Ill. 290, and Peacock v. Phillips, 247 Ill. 467, the court followed the law as laid down in Olds v. Cummings, supra, and the long line of decisions following, holding that such paper as is involved here is, in equity, subject to all the defenses which could be equitably interposed against the original holder. In its opinion in Bartholf v. Bensley, supra, the Supreme' Court makes no reference to the Act of 1901 and in Schott v. Horney, supra, the Appellate Court for the Third District concluded that the attention of the Supreme Court had not been called to the statute although the incumbrance sought to be foreclosed in that case was created after the passage of the act.

However, this act was again involved in the recent case of Smith v. Niemann, 216 Ill. App. 179, where it was pointed out that an examination of the briefs and abstracts filed in the Supreme Court in Bartholf v. Bensley, supra, showed that in that case this act was not only brought to the attention of the Supreme Court, but that the journals of the House of Representatives were introduced in evidence before the master, and that such journals showed that the act in question had been defeated in that body and the validity of the statute was argued at length in the briefs.

As pointed out in Smith v. Niemann, supra: “While the subject of the existence or nonexistence of this Act of 1901 is not alluded to in the opinion in Bartholf v. Bensley, supra, we will assume that the court reached the conclusion from the evidence of the journals of the House of Representatives in that record that the act was * * * nonexistent, and placed its decision, as it did, upon the doctrine of the Olds case, supra, uniformly followed wherever the question there decided was subsequently before the court.” Following these decisions, we hold that the Act of 1901, invoked by complainants, does not exist as a part of the laws of Illinois.

In urging that the decree be reversed, complainants further contend that Mengel is estopped, by the verdict against him in the action at law on these notes, from setting up the defense that the notes and trust deed were procured from him by fraud and are without consideration. Of course this cannot be true for the equitable defenses available to Mengel in the suit at bar were not available to him in the action at law. The issues involved here are therefore broader than they were in the action at la.w. That being true, Mengel cannot be estopped by the verdict in that action, from setting up those equitable defenses here. The cases called to our attention by complainants in support of their contention are not at all in point. One of these cases is Black v. Thomson, 120 Ill. App. 424, in which the court holds that the findings of a decree in a foreclosure proceeding are res adjudicata in an action at law instituted upon the notes foreclosed where the parties are identical and no question of jurisdiction is raised. That is the reverse of the case at bar. In the case cited no defenses could be interposed in the action at law which were not available to the defendant in equity. The issues involved in the action at law were narrower than they were in the suit in equity. Whereas, in that situation, the defendant would be precluded by the decree in the equity suit from again setting up against his notes, in the action at law, the defenses which had been available to him in equity, it by no means follows that where a judgment at law precedes the decree in the equity suit, a judgment in the law action will preclude a defondant from setting up against the complainants in equity, those defenses available to him there and which'he had not been able to interpose at law. Ati-n other case cited by complainants is Fosdick v. Forbes, 120 Ill. App. 226. In that case judgments were recovered by Forbes against Fosdick on certain judgment notes given by the latter in payment for a stallion. Fosdick thereupon conveyed certain, real estate to his wife. Forbes alleged the conveyance was fraudulent and filed a bill in equity to set it aside. A conservator was appointed for Fosdick and he defended the suit in equity and filed a cross-bill praying that the judgments by confession, upon which the suit in equity was predicted, be set aside and that he be permitted to plead and defend in the suits at law. That is very different from the prayer of the cross-bill filed by Mengel here.' The defenses sought to be set up under the cross-bill in the case cited were the legal defenses of breach of warranty and failure of consideration which had already been determined in the .action at law, while the defense which Mengel seeks to avail himself of here is the equitable defense of fraud which he could in no way put in issue in the action at law.

Complainants also cite in this cqnnection, Chicago Title & Trust Co. v. Moody, 233 Ill. 634, where the court applies the principles of estoppel by verdict to a situation where those principles are applicable. We hold that the situation presented by the facts involved in the case at bar is one where those principles cannot be applied.

Finally, complainants contend that the equities are with them; that the notes executed by Mengel were accommodation paper and thus within the rule laid down in Miller v. Larned, 103 Ill. 562; that Mengel possessed no equities at the time complainants bought the notes and trust deed in question but that his equities, if any, did not arise until his contract of sale with Grander was subsequently canceled and that Werner cannot be considered as an assignee of Men-gel and assignor of these complainants but as the agent of Mengel, which the latter had clothed with apparent authority to dispose of the paper by placing it in his possession. Even if we could dignify the notes signed by Mengel with the term “accommodation paper,” we are of the opinion that Miller v. Larned has no application to the facts involved here. The fallacy of all complainants’ contentions, just referred to, lies in the fact that the execution of the tirost deed here sought to be foreclosed by complainants was obtained by Werner by the grossest fraud. Mengel’s testimony is to the effect that he did not discover that among the papers he signed at the time the notes were executed, there was included this trust deed, until some months later. The decree appealed from contains a finding to that effect. It is true that the master’s report, at least constructively, makes a contrary finding to the effect that the evidence fails to support the allegations of Mengel’s cross-bill. However, his evidence on this point is in no way contradicted in the record, except by the bare fact that he did execute a trust deed. But it is not hard to understand that one who would be so gullible as to comply with such a preposterous proposition as Werner made when he asked Mengel, the seller of the property, to sign notes for use by Grander, the buyer, in raising the cash with which to pay the seller the purchase price of the property, could also be made to put his signature on a trust deed without knowing that the paper he was signing was a deed. Mengel testified that when he put his signature on the trust deed, it was not opened up but was folded together and in asking him to sign it Werner said something about the need of Mengel signing some paper to show that he was the owner of the property.

When the complainants purchased the notes secured by the trust deed here sought to be foreclosed, it was their duty to inquire of Mengel if any reason existed why the incumbrance should not be paid. If they chose to buy the paper without malting such inquiry, they assumed the risk of such equities as might be in existence between Mengel and Werner. As was said by our Supreme Court in McAuliffe v. Reuter, 166 Ill. 491, quoting from Sumner v. Waugh, 56 Ill. 531: “When a person buys that which is not assignable at law, relying upon a court of equity to enforce and protect his rights, he takes it subject to all the infirmities to which it would have been liable in the hands of the assignor,” and further quoting from Haskell v. Brown, 65 Ill. 29, in such a case “a court of equity will let in any defense which would have been good against the mortgage in the hands of the mortgagee himself.” The court also said, referring to Shippen v. Whittier, 117 Ill. 282, that the fact that the notes involved were payable to the order of the maker and indorsed by him and that the security was in the form of a trust deed is unimportant. Complainants strenuously argue that Werner was Mengel’s agent. We think the point entirely without merit and moreover, in getting these papers from Mengel, if Werner was acting as the agent of any body, it was as agent of Grander.

We find no error in the record and the decree of the superior court is, therefore, affirmed.

Affirmed.

Mr. Justices Taylor and O’Connor concur.


author: Mr. Justice O’Connor

text:
    Krug Coal Company, Appellant, v. C. G. Blake Company, Appellee.
    Gen. No. 24,782.
    1. Sales, § 373

      —when evidence is sufficient to show performance of contract. In an action by a coal company against a mine operator to recover for breach of a contract for the sale and delivery of coal, where the contract provides that shipments thereunder are subject to the “omissions of railway companies,” and it is agreed that there was a shortage of cars and that defendant ratably proportioned the cars it received among its several customers and, on conflicting evidence, the court below found that there was a well-known custom of coal dealers of the city where the coal was delivered to apportion the cars among customers in case of such a shortage, it will be held on appeal that defendant did all that he was required to do under his contract when he ratably distributed his cars.
    2. Appeal and error, § 1300*—when existence of custom is presumed established. Where the evidence in regard to the existence of a custom of a trade is conflicting, it will be assumed, on appeal, that the trial court in deciding for defendant, found that the evidence established defendant’s contention in regard thereto.
    3. Carriers, § 78*—when shipper is entitled to delivery of goods. Where a shipper retains the bill of lading he is authorized, under Rev. St. ch. 121-a, sec. 20, par. 3 [Callaghan’s 1916 Stat. 1i 10021(23)], to take possession of the car as against the buyer to whom it was shipped, and where the latter is in default in payment at the time of the diversion, he cannot complain thereof.
    4. Sales, § 367*—what claim, may be set off by seller. A claim for the purchase price of cars of coal as agreed upon, being a claim for liquidated damages, can be set off in an action brought to recover damages for an alleged breach of contract.
    Appeal from the Municipal Court of Chicago; the Hon. Harry P. Dolan, Judge, presiding. Heard in the Branch Appellate Court at the October term, 1918.
    Affirmed.
    Opinion filed April 21, 1920.
    Howard Ames, for appellant.

      Gallagher, Kohlsaat & Rinaker, for appellee; B. B. Wilkiusou, of counsel.

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

   Mr. Justice O’Connor

delivered the opinion of the court.

The Krug Coal Company brought suit against the C. G. Blake Company claiming damages by reason of the failure of defendant to ship coal to plaintiff in accordance with the terms of a contract between them. Defendant filed an affidavit of merits and a set-off claiming $550.46 balance due for coal sold and delivered. The cause was tried before the court without a jury. There was a finding and judgment in favor of defendant for the amount of the set-off, to reverse which plaintiff prosecutes this appeal.

The record discloses that plaintiff was engaged in selling coal in Chicago. Defendant operated a coal mine in West Virginia, with its principal place of business in Cincinnati and a branch office in Chicago. The parties entered into a written contract July 31, 1916, whereby defendant sold to plaintiff two thousand tons of New River Run of Mine coal at $1.50 per ton, f. o. b. mines, shipments to be made six cars per month from August 1, 1916, to March, 1917, both inclusive. Payments were to be made on the 15th of each month 'following shipments. The contract further provided that, “Shipments on this contract are subject to the normal operation of. the collieries and omissions of the railway companies.” At the expiration of the time covered by the contract defendant had failed to ship more than six hundred tons of the coal sold. The evidence shows that practically every month the defendant failed to ship the number of cars specified in the contract. On March 15, 1917, there was a balance due defendant of $84.30 for coal shipped during the month of February, and on March 27, 1917, defendant notified plaintiff that it had canceled the contract on account of plaintiff’s failure to pay the biff due March 15. Thereafter defendant refused to ship any more coal under the contract. Afterwards, on May 27 or 28, defendant sold and delivered to plaintiff two cars of coal at $5.25 per ton, making the amount of its set-off, $550.46. Plaintiff claimed that these two cars were shipped under the contract. A witness for plaintiff testified that on the 27th or 28th of May he tallied over the telephone with the representative of defendant and the latter asked him if he wanted two cars of coal then being shipped and he replied that he did; that there was nothing said about the price. On the other hand, a representative of defendant testified that the conversation on the telephone was in substance that the witness asked plaintiff’s president whether he wanted to purchase the two cars of coal at $5.25 per ton, and that the latter replied in the affirmative; that the coal was then sent to plaintiff as was also a copy of the order of sale and a bill. The evidence further shows that defendant had coal contracts with other parties in Chicago that were entered into prior to the date the contract in question was made, and that all of the contracts made by defendant for the sale of coal disposed of but 50 per cent of the capacity of defendant’s mines. It was agreed that there was a shortage of cars, and that defendant- could not obtain sufficient cars to fill its contracts, and that defendant delivered eoal under its contracts ratably among all of its customers including plaintiff—that plaintiff secured its proportionate share of the coal shipped.

Plaintiff contends that defendant first breached the contract when it failed during the several months to ship the quantity of coal required and, therefore, plaintiff was entitled to recover damages. On the other hand, defendant’s position is that it did not breach the contract at any time; that the failure to deliver the number of cars specified was the fault of the railway companies and that this contingency was expressly provided for in the contract, for the defendant was excused for failure to deliver the number of cars where such failure was caused by “omissions of the railway companies.”

It is undisputed that the failure of defendant to ship the coal as required was caused by its inability to secure sufficient cars. Plaintiff’s position, however, is that the failure of defendant to secure sufficient cars does not excuse it since there were enough cars available to deliver to plaintiff its coal if there had been no prorating of the coal delivered by defendant among its customers, and that under the contract defendant was not authorized to do this. In 35 Cye. (p. 248) it is said: “If the sale is made subject to strikes, accidents, or causes beyond the seller’s control, the seller is not liable for deficiencies on his part in shipments due to a strike or a shortage of cars or other causes beyond his control, if he treats the buyer fairly and ratably with reference to other parties with whom he was dealing, and is not re-, quired to deliver to the buyer the whole amount of his order to the exclusion of other customers.” The author cites as authority the case of Garfield & Proctor Coal Co. v. Pennsylvania Coal & Coke Co., 199 Mass. 22. In that case the contract for the sale of coal provided that part of it should be shipped in about equal monthly proportions, and further that shipments to be made were “subject to strikes, etc.” There was a shortage of cars and the seller shipped to the purchaser his pro rata share of all the coal produced, but not the full amount of the contract. The court held that this was a compliance with the contract and said: “The court ruled in substance that defendant would not be liable for deficiencies on its part which were due to strikes or a shortage of cars or other causes beyond its control, if under the circumstances it had treated plaintiff fairly and ratably with reference to other customers with whom it was dealing; that defendant was not bound under the terms of the agreement to deliver to plaintiff the whole amount of its coal to the exclusion of its other customers.” To the same effect is Jessup & Moore Paper Co. v. Piper, 133 Fed. 108, where there was a failure on the part of the seller to deliver the quantity of coal contracted for on account of a shortage of ears. The contract provided that the seller should not be liable for a failure to perform if prevented by hindrances beyond their control. The evidence showed that the seller had distributed the cars which were furnished ratably among their customers. The court there said: “The allegation upon the part of the defendants that they did not have sufficient cars to enable them to fulfill their contracts, and therefore they did the next best thing; that is to say, they apportioned their cars among all their customers, giving to each one his due and ratable share. If the facts were as averred by the defendants, I think that would be a fair, a reasonable and proper thing to do. I do not think the defendants could be called upon to carry out one contract in full at the expense of all the other contracts for which they were equally bound, but that if there was a genuine scarcity of cars, so. that it was impossible for them, for example, to carry out more than 25 per cent of their contracts, if they carried out 25 per cent of .each contract I think that would be a perfectly fair and proper and lawful thing to do, under such a contract. * * * If they gave the plaintiff its ratable share of cars during the period in question, then they certainly have discharged all their duty with reference to that part of the claim that they could be called upon to discharge.” The same ruling was applied in Consolidated Coal Co. v. Mexico Fire-Brick Co., 66 Mo. App. 296. In the instant case it is agreed that there was a shortage of cars and that defendant ratably proportioned the cars it received among its several customers. This was all it was required to do under the terms of the contract. In addition there was testimony, pro and con, as to whether there was a well-known custom among coal dealers in Chicago, in the event of a shortage of cars, for a seller of coal to proportion such cars as he received among his customers, and although there was conflict in the testimony on this point, since the court decided for the defendant, we must assume that he found the evidence established the custom. In these circumstances, the custom entered into and formed a part of the contract and, therefore, the defendant did all it was required to do under the contract when it ratably distributed the cars among its customers.

On March 20, 1917, defendant shipped a car of coal to plaintiff, but, before delivery, diverted it to another customer. Plaintiff contends that this was a conversion of the car of coal, and that it was entitled to the value of it. Apparently the defendant retained the bill of lading, and in these circumstances, par., 3, sec. 20, ch. 121-a, Rev. St. [Callaghan’s 1916 Stat. ft 10021(23)] authorized defendant to. take possession of the car as against the buyer, and since plaintiff was in default at the time of the diversion, he can make no complaint.

Plaintiff also argues that defendant’s claim was not proper subject-matter of set-off. We think the point is untenable. Defendant’s claim was for liquidated damages, being the purchase price of the two cars of coal as agreed upon, and in such circumstances it can be set off in an action brought for damages for an alleged breach of contract.

The judgment of the municipal court of Chicago is affirmed.

Affirmed.

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


text:
    Thomas C. Dennehy and Virginie Dennehy, Appellants, v. Frederick R. Barnheisel, Appellee.
    Gen. No. 24,943.
    Landlord and tenant, § 274

      —when tenant who covenants to pay taxes need not pay income tax. Under a covenant in a lease, executed at the time a federal income tax was in force, which provides that the lessee is to pay, in addition to the rent “income tax (should there ever be any levied), * * * which may be levied, charged or imposed upon said premises,” and requires the lessee to pay all taxes and assessments before any application for judgment is made in any court to collect the same, and provides also that the landlord may pay all taxes and assessments “charged upon the demised premises,” which shall be so much additional rent, the lessee cannot be required to reimburse the landlord for income tax paid by the landlord on the rental derived from the premises, where the federal act under which the tax was imposed does not make it a charge against the premises but a personal liability against the person receiving the income, but such provision in the lease would be effective against the lessee were the income tax made by the act a charge upon the premises.
    Appeal from the Municipal Court of Chicago; the Hon. Hugh J. Kearns, Judge, presiding. Heard in the Branch Appellate Court at the March term, 1919.
    Affirmed.
    Opinion filed April 21, 1920.
    Isadore S. Blumenthal, for appellants.
    Mayer, Meyer, Austrian & Platt, for appellee.

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

   Mr. Justice O’Connor

delivered the opinion of the court.

Plaintiffs brought suit against defendant to recover ground rent, income tax, and attorney’s fees, which they claim to be due them under the terms of a lease, by which they leased certain premises to defendant. Defendant admitted that he owed the ground rent and tendered it. The case was tried before the court without a jury and there.was a judgment in favor of plaintiffs for the amount defendant admitted was due, and a finding and judgment against plaintiffs as to the balance of their claim, to reverse which plaintiffs prosecute this appeal.

The facts, shortly, are these: October 31, 1916, plaintiffs, by a written lease demised to defendant certain premises in Chicago for a term ending March 31, 2011. The lease, after requiring the payment by the tenant of a specified annual rental,. provides: “The lessee further covenants and agrees to pay, in addition to the rents herein reserved, all taxes, assessments, income tax (should there ever be any levied), sanitary district or drainage taxes, water rates, and all other impositions and charges, general and special, which may be levied, charged or imposed upon said premises, or any part thereof, # * * which taxes, assessments, water rates and other impositions shall be paid by the lessee in the name of the lessor before any application for judgment in any court to collect the same/ is made, and the receipts for such payments *. * * before the first day of the tax sale for the year in which such taxes are payable, shall be" delivered by the lessee to the lessor * * *.

“The lessor shall at their option have the right without application, to inquire into the validity thereof, at all times during the said demised term, to pay any rates, taxes, assessments, water rates or other charges upon said demised premises * * * remaining unpaid after the same shall have become due and payable.” . The lease further provides that any such payments made by the lessors shall be so much additional rent.

The question to be determined is whether defendant under the provisions of the lease just quoted was required to reimburse plaintiffs for income tax paid by them on the rents derived from the premises. We think it clear that the question must be answered in the negative. The covenant in question expressly provides that the lessee in addition to the rent is to pay “income tax (should there ever be any levied) * * * which may be levied, charged or imposed upon said premises.” At the time of the execution of the lease there was in force a national law of the same character as the present income tax law and if it was intended, as plaintiffs now contend, that the tenant should pay all income taxes, why insert the words “should there ever be any levied”! If it were the intention to require the tenant to pay all income taxes which plaintiffs were compelled to pay by reason of the rent derived from this property, it would have been a simple matter to have stated so in plain language. The income tax which plaintiffs are seeking to recover is not “levied, charged or imposed upon said premises.” It is a personal liability against the person receiving the income. That the tenant is not required, under the lease, to pay the income tax in question is further shown by the fact that the lease requires him to pay all taxes and assessments before any application for judgment is made in any court to collect the same, and from the further fact that the landlord may pay all taxes and assessments “charged upon the demised premises,” which shall be so much additional rent.

We have examined all the, authorities cited in the briefs, and a discussion of them would serve no useful purpose. The provisions of no two leases are the same, and each case must be decided upon the particular wording of the lease under consideration. We mention, however, the two leading cases: Suter v. Jordan Marsh Co., 225 Mass. 34, principally relied upon by plaintiffs, and Codman v. American Piano Co., 229 Mass. 285, relied upon by defendant. In the Suter case the covenant of the lease, besides requiring the payment of an annual rent, water taxes, and other rates, provides that the lessee “will also pay in addition in each year whenever the same are due and payable, and before any interest or penalty accrues thereon, all taxes and assessments whatsoever, except betterment taxes, which may be levied for or in respect of the said leased premises, or any part thereof, or upon or in respect of the rent payable hereunder by the lessee, howsoever and to whomsoever' assessed.” Under this provision the tenant was held liable for the landlord’s income tax. In the Godman case the' provision was: “And. the lessee further covenants and agrees with the lessors to pay punctually within fourteen (14) days from the times when they become due and payable, all taxes and assessments whatsoever, which may be payable for or in respect of the leased premises during the term thereof, except assessments for betterments hereinafter arranged for.” It was there held that this provision did not require the tenant to pay any income taxes. The court there discussed the Suter case and in reference to the covenant of the lease quoted from that case said (p. 288):

“It is to be noted that the covenant required the lessee to pay the taxes not only for or in respect to the premises leased, but also ‘upon or in respect of the rent payable’ under the lease. Accordingly it was said by this court that ‘by the terms of the lease, the defendant has obligated itself to pay “all taxes and assessments * * * upon or in respect of the rent * * * howsoever and to whomsoever assessed.” The setting forth of the defense shows that it cannot prevail.’ In other words, the agreement of the parties as expressed in the lease is to govern and control their respective rights in view of the language employed.

“In the case at bar the covenant in the lease contains no agreement that the lessee will pay taxes assessed upon or in respect of rent payable under the lease, and is so clearly distinguishable from the case of Suter v. Jordan Marsh Co., supra.”

We think it clear that the provisions of the lease did not require the tenant to pay the income tax sought to be recovered in this ca.se. If, in the future, however, the Congress should enact legislation which would impose any income tax upon the property in question, then the provision in the lease would become effective.

The judgment of the municipal court of Chicago is affirmed.

Affirmed.

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