author: Mr. Justice Freeman

text:
    Mary J. Zollman, Appellant, v. Jackson Trust & Savings Bank et al., Appellees.
    Gen. No. 13,907.
    1. Negotiable instruments—who innocent purchaser for value. The purchase of notes secured hy trust deed, which notes and trust deed represent a building loan, may be enforced at law notwithstanding the consideration for the notes has failed, if the purchaser thereof acquired the same for value before maturity and without notice of the lack of consideration, even though such purchaser acquired, together with the notes and trust deed securing the same, an insurance policy which contained an indorsement granting permission to the insured to complete the building covered by the trust deed.
    2. Pleading—when relief sought hy cross-hill appropriate. Where an action is instituted to enjoin the enforcement of promissory notes, a cross-bill praying a decree for - the amount due under the notes is appropriate upon the principle that where a court of equity obtains jurisdiction for one purpose, it will retain it for all purposes necessary to do complete justice between the parties in interest.
    Bill to remove cloud, etc. Appeal from the Circuit Court of Cook county; the Hon. Lockwood Honors, Judge, presiding.
    Heard in the Branch Appellate Court at the October term, 1907.
    Affirmed.
    Opinion filed May 19, 1908.
    Statement by the Court. Appellant filed her bill of complaint in which she states inter pitia that she is erecting an apartment building on certain described property which she owns and is in possession of; that in order to complete said building she negotiated a building loan from one Henry W. Howe in January, 1906, and gave a trust deed on said property to secure her note for $7,000, with interest notes, which notes were made payable to her own order and by her indorsed; that said notes were delivered to said Howe, he agreeing to pay the complainant the said $7,000 as the building progressed; that said Howe never paid her any part of that sum and that the consideration has wholly failed; that Howe delivered said notes, together with the trust deed' and policies of insurance on said premises, to appellee, the Jackson Trust & Savings Bank, which now claims to be the legal holder thereof. She avers that appellees knew at the time they received the notes that no consideration had been paid for them and that the buildings were unfinished. The bill alleges that the trust deed is a cloud upon appellant’s property, and prays it may be decreed null and void, and that appellees may be compelled to cancel and deliver up the note for $7,000, with the interest notes, trust deed, insurance policies and abstract of title to said premises.
    Appellees answered, neither admitting nor denying most of the allegations of the bill, alleging that if complainant negotiated a loan from said Howe the latter was her agent; and denying that Howe never paid her any part of the amount of said loan and that no consideration was paid for the notes or that such consideration has wholly failed.
    Later, on petition of appellant, an order was entered restraining the Jackson Trust and Savings Bank from further prosecution of a suit at law then pending in the Superior Court against appellant as defendant. Thereupon the bank filed a cross-bill in this suit, setting forth that it obtained the said notes in the ordinary course of business from Henry W. Howe for a valuable consideration and in good faith, as security for an indebtedness, of said Howe to said bank approximating $20,000; that it never had any notice of equities alleged to have existed between appellant and said Howe; that appellant made default in the payment of the first interest coupon April 1, 1906; that May 3, 1906, the cross-complainant elected to and did declare the whole principal sum, with accrued interest, due and payable at once, and that there is due from appellant $7,000, with interest at 4% per cent, from and after April 1, 1906, to the third day of May, 1906, and 7 per cent, per annum from and after said last mentioned date, together with $73.80 and interest theron from April 1, 1906, at the rate of 7 per cent, per annum, no part of which has been paid and for which cross-complainant is entitled to judgment against appellant.
    It is further averred that the cross-complainant filed its suit at common law against appellant in the Superior Court of Cook county, which suit the court restrained until the final outcome of this cause and that therefore cross-complainant files the cross-bill to obtain the same relief it might have had in said suit at law.
    Appellant answered said cross-bill alleging that said notes, trust deed and policies of insurance were delivered to said Howe in trust to be held until the title to said lots should show the record of said trust deed and until the amount of said notes became due and payable to the contractors and material men for work and material on said building in process of construction; that said loan is what is known as a building loan and that Howe promised to pay-the bills for material and labor as the building progressed, which promise has been wholly disregarded; that no part of said sum evidenced by said notes has been paid and no consideration given for said notes or alleged trust deed. Appellant—-cross-defendant—-further denies that said bank obtained said notes in the ordinary course of business and for a valuable consideration from said Howe and in good faith as security for a loan prior to maturity, and denies that said bank never had notice of the equities between appellant and said Howe; alleges that said bank took said notes, trust deed and certain insurance policies with full knowledge that the notes were executed for the purpose of a building loan, and that said building was not completed and that no consideration had been paid for said notes. The answer denies other allegations of the cross-bill and denies that the cross-complainant is entitled to the relief it seeks and that the court has jurisdiction to grant such relief.
    The cause was referred to a master, who reported that an alleged law of 1901 making mortgages, trust deeds and other conveyances in the nature of mortgages negotiable instruments is void; that the trust deed securing said notes is also void; but the master recommends a money judgment on the cross-bill. Eventually a decree for money against appellant for the amount alleged to be due on the notes, with interest and costs, was entered, from which this appeal is prosecuted.
    Ernest Sevebly, for appellant.
    Adams & Fboehlioh, for appellees.
   Mr. Justice Freeman

delivered the opinion of the court.

It appears from the evidence, as to which there is no material controversy, that appellant began about October 1, 1905, the erection of an apartment building on the land described in the trust deed in question, and that to complete the building she obtained a building loan of $7,000 from one Henry W. Howe, for which sum she executed her promissory note payable to her own order and by her indorsed, together with seven interest notes, and to secure such loan executed a trust deed conveying the property in question to the Chicago Title & Trust Company as trustee. The trust deed was filed for record January 15, 1906. The notes, the trust deed and certain insurance policies were all placed in the hands of Howe, with an agreement or understanding that February 1, 1906, and afterward as occasion required, appellant should fill out a blank form showing what bills were to be paid and Howe should pay them out of the amount so to be loaned by him to appellant. None of this money supposed to be represented by the note and trust deed executed and delivered to Howe by appellant was ever paid over to appellant or to anyone on her account. On the second of February, 1906, Howe committed suicide.

Meanwhile, on January 20, 1906, Howe had turned over to the Jackson Trust and Savings Bank the note for $7,000 executed by appellant, together with the interest coupons, trust deed securing the same and two policies of insurance on the incomplete buildings. Said policies contained a permit for the completion of the buildings. The notes and other documents were received by the bank as collateral security for loans made by the bank to Howe.

It is argued in behalf of appellant that there can be no innocent purchaser for value without notice of mortgage securities in this state, that the purchaser takes the same subject to equities between the original parties to the mortgage, and that different instruments executed at the same time, constitute in law but a single instrument. In support of such contention appellant quotes what is said in Y. M. C. A. G. Co. v. Bank, 179 Ill. 599-605: “We have frequently held that the assignee of a mortgage holds it and the indebtedness secured by it subject to the same defenses which might have been urged against the mortgage.” In the same case, however (p. 604), it is said that where negotiable paper is “transferred to an innocent purchaser for value before due, without any notice of the absence of title in the assignor, the transferee will obtain the legal title even against the true owner.” The appellee in this case holds the note in controversy, a negotiable instrument, upon the same terms and conditions as the note involved in Buehler v. McCormick, 169 Ill. 269-273. The note in this case, as in that, was indorsed in blank by the maker and delivered to appellee with the trust deed given to secure it. Appellee, as in that case, became “an assignee of the note, and by virtue of that fact an assignee of the mortgage also, though as to the mortgage only an equitable assignee. Because the mortgage secured the payment of the note to the legal holder, cannot, upon any legal principle which we are aware of, make any difference * * * and the note secured would be negotiable and would pass free from all equities between the parties; but the legal and equitable character of the mortgage remained the same.” To the same effect is Martina v. Muhlke, 186 Ill. 327-330. There the distinction between an equitable. claim under a trust deed given to secure notes under conditions similar to those in the case at bar, and the “legal claim, quite independent of any lien upon the premises in question, which legal claim was acquired by the defendant as purchaser of the notes for value and before maturity and without notice ’ ’ of any defense by the maker of the notes, is clearly stated. It was held that an equitable defense against the lien of a trust deed is no defense against a judgment on the notes. It was said by this court in Metcalf v. Draper, 98 Ill. App. 399-408, that if one carelessly and without consideration lets his note go into circulation, and an innocent party purchases it in the usual course of business, upon the former must fall the loss, for he it was whose conduct made it possible for the purchaser to be deceived. In Bradwell v. Pryor, 221 Ill. 602-605, the rule is stated to be that the indorsee or assignee of commercial paper who takes the same before maturity for a valuable consideration without knowledge of any defects and in good faith will be protected against the defenses of the maker, and the only thing which will defeat his title is bad faith on his part; and to establish such bad faith by a preponderance of the evidence the burden of proof is upon the person assailing the assignee’s right.

In the case at bar appellant had borrowed money from Howe which, she had left in his hands for disbursement on her order as the building progressed. The notes evidencing the loan were turned over to him. To all appearance at least, if not in fact and law, he was at liberty to sell or otherwise dispose of them as he might see fit, provided of course as between himself and appellant it was his duty to advance to her the money as agreed between them. By the transfer of the notes to appellee for an actual consideration advanced by the latter in good faith, before maturity and without notice of any equities in favor of appellant against Howe, appellee became a bona fide holder for value. The evidence clearly, we think, sustains the contention that appellee was in fact an innocent purchaser before maturity-for value, notwithstanding that the insurance policies delivered to appellee with the notes and trust deed contained an indorsement granting permission to the insured to complete the building covered by the trust deed. We are unable to concur in the contention of appellant’s counsel that these indorsements were “equivalent to the statement” that the notes were for a building loan upon a building-in course of construction, and that the money had not yet been paid over by Howe; and that they tend to show, therefore, the bank was not an innocent purchaser for value. The fact that it was a building loan was in no way equivalent to notice that the money had not been, much less that it would not be, paid over. It might have been paid, so far as the notes or other papers showed; but whether so or not, appellant had trusted Howe to pay it over as required, and had trusted him with the notes. Appellee was, we think, entitled to assume that she had protected herself against fraud or failure on his part. That he failed to pay it was her misfortune, not the fault of appellee. In Sigel v. Chicago Trust and Savings Bank, 131 Ill. 569-572, the court quotes approvingly from State Nat. Bank v. Carson, 39 La. Ann. 865, that “it cannot affect the negotiability of a note that its consideration is to be hereafter realized or that from contingency it may never be enjoyed.” That the note is given for an ex-ecutory contract or promise on the part of the payee will not destroy its negotiability, it is said, unless the recital on the instrument “qualifies the promise to pay and renders it conditional or uncertain, either as to the time of payment or the sum to be paid.” There are no such qualifying recitals in the case at bar.

It is urged there is no equity in the cross-bill, and that it gave the court no jurisdiction, that when a cross-bill seeks relief it must be equitable relief; citing Cotes v. Bennett, 183 Ill. 82, and Phelan v. Iona Sav. Bank, 48 Ill. App. 171. The case at bar, however, is not a foreclosure proceeding. Appellee had begun a suit at law in the Superior Court on the notes. Appellant enjoined its prosecution and forced appellee into chancery. It is a rule of equity procedure that where a court obtains jurisdiction for one purpose “if will retain it for all purposes necessary to do complete justice between the parties interested, although that may require that some matters be passed upon which alone would not be cognizable in such a court. ’ ’ Correll v. Freeman, 29 Ill. App. 39-44. In - such case “the right of the defendant to maintain a cross-bill that is germane to the original bill is not dependent upon the validity of the claim made in the original bill.” Biegler v. Merchants L. & T. Co., 164 Ill. 197-209. In the same case the Appellate Court (62 Ill. App. 560) said: “Parties resorting to equity and inviting its administration are not permitted, after the filing of a cross-bill which prays for relief germane to the original suit, and after being defeated in equity or anticipating defeat there, to retrace their steps and compel the defendant who has filed his cross-bill to again return to the court of law from proceeding in which he had been enjoined.”

It is urged that appellee had no right to compromise with parties claimed to have been liable on any of the collateral security which it held. Whatever may be said as to such right, it is apparent in any event that appellant was not injured by its exercise in this instance. Had such compromises not been made and the whole of the amounts compromised been paid to appellee, there would still have been due the latter more than it will obtain on this judgment and any other collateral it holds.

We find no material error in the decree, and it must be affirmed.

Affirmed.


source: Caselaw Access Project

license: Public Domain

text:
    Anton Fatz, Appellee, v. Continental Manufacturing Company, Appellant.
    Gen. No. 13,998.

      Instructions—when erroneous in ignoring defense of assumed risTc. An instruction as follows, with respect to the preponderance of the evidence, is erroneous in ignoring the defense of assumed risk.
    “While the burden is on the plaintiff to prove his case by a preponderance of the evidence, still if the jury find that the evidence bearing upon the plaintiff’s case preponderates in his favor, although but slightly, that would be sufficient to warrant the jury in finding in his favor. If you find from the evidence that the plaintiff has proved his case as laid in the first count of his declaration by a preponderance of the evidence, then you should find the issues for the plaintiff.”
    Action in case for personal injuries. Appeal from the Circuit Court of Cook county; the Hon. Charles M. Walker, Judge, presiding.
    Heard in the Branch Appellate Court at the October term, 1907.
    Reversed and remanded.
    Opinion filed May 19, 1908.
    Statement by the Court. This is an action for personal injuries in which appellee recovered a judgment for $500.
    At the time of the injury appellee was operating a planer in appellant’s furniture factory, dressing, it is said, one-inch boards down to a thickness of seven-eights of an inch. A board was in process of being planed and had passed nearly through the planer, within five inches of the end, it is said, when the board was “kicked back,” striking appellee, who was standing about sixteen feet in front of the machine, inflicting the injuries complained of. Appellee states that when he first started to work on the machine he noticed that it was not quite right; that the plates or “chip breakers” which pressed down on and held the boards as they were being planed were three-sixteenths of an inch longer on one side than the other, so that the roller would catch the board more on one side than the other. He states that he mentioned this to the foreman, who said he “would have it fixed.” About two days before the accident the foreman sent a man to fix the rollers, but it is claimed that the screws or bolts with which the rollers were adjusted were too short and that this prevented the roller from gripping the board tightly enough. The foreman is said to have been told of this and he said a man from the machine shop would come and fix it. It is claimed that very often, sometimes as often as every other day, “boards would get stuck in the machine, ’ ’ and that then a man “would come and fix the machine and it would run all right again.”
    The declaration charges that appellant allowed the planer to become and remain in an unsafe condition and out of repair so that it became “worn out and defective so that the feed rollers by means of which boards were carried under and through the knives of said planer” became ineffective, etc.
    F. J. Canty and J. C. M. Clow, for appellant.
    J. W. Sutton, for appellee.
   Mr. Justice Freeman

delivered the opinion of the court.

It is contended in behalf of appellant that the proof utterly fails to sustain the charge of negligence in the declaration; that plaintiff had been a regular and constant operator of planers for nearly seven years before the accident, and under the law must be held to have had full knowledge of the condition of the planer, whatever it was, and that the rule of assumed risk is a complete bar to recovery by appellee. It is urged, therefore, that it was erroneous to instruct the jury that a servant assumes only those risks incident to the work, omitting the class of risks which the servant assumes by continuing the work with full knowledge of the danger; and that by a further instruction the court eliminated entirely the defense of assumed risk.

The instruction last referred to is as follows:

“While the burden is on the plaintiff to prove his case by a preponderance of the evidence, still if the jury find that the evidence bearing upon the plaintiff’s case preponderates in his favor, although but slightly, that would be sufficient to warrant the jury in finding in his favor. If you find from the evidence that the plaintiff has proved his case as laid in the first count of his declaration by a preponderance of the evidence, then you should find the issues for the plaintiff.”

This instruction was erroneous, inasmuch as it wholly ignores the question of assumed risk.” Montgomery Coal Co. v. Barringer, 218 Ill. 327. The instruction directs the jury that they “should find the issues for the plaintiff” if they find from the evidence that the plaintiff has proved by a preponderance of evidence his case as laid in the first count of his declaration, the only count upon which the cause was submitted. We said, through Mr. Justice Baker, in The Lake Street Elevated Railroad Company v. Fitzgerald, 136 Ill. App. 281: “In a case where the assumption of risk is involved, it is error to instruct the jury that if the plaintiff has made out his case as alleged in his declaration or any count thereof he is entitled to a verdict, for the reason that such instruction ignores the assumption of risk.” In the opinion filed in that cause the question here involved is fully considered and the authorities cited. The instruction above quoted was clearly erroneous and requires that the judgment of the Circuit Court shall be reversed and the cause remanded. It will be so ordered.

Reversed and remanded.


author: Mr. Justice Smith

text:
    Matthew H. McCarthy, Appellant, v. Henry Crawford et al., Appellees.
    Gen. No. 13,988.
    1. Res judicata—when judgment not, of merits of controversy. A judgment upon a demurrer sustained upon jurisdictional grounds is not conclusive of the merits of the controversy involved in a proceeding.
    2.. Receiver’s certificate—nature and effect of. A receiver’s certificate is not a negotiable instrument and likewise it is not a gtotzs ¿-negotiable instrument; it is not a substantive obligation, but is mere evidence of an indebtedness proven against an estate under an administrative order for the purpose of administering the estate, and entitles the holder to a distributive share when the amount thereof has been determined and distribution ordered.
    3. Receiver’s certificates—when title to, does not pass. The title to a receiver’s certificate does not pass by delivery where such certificate has been issued pursuant to an order of court which required the registration of such certificate and provided that interest was to be paid only to the registered owner and that title thereto should be recognized only on condition of a surrender thereof and the making óf a new registration.
    4. Receiver’s certificates—when purchaser bound to investigate extent of broker's authority to sell. One who undertakes to purchase trust property of a broker, such as a receiver’s certificate, is bound to investigate and ascertain the power of such broker to make sale thereof; and this rule is not changed by the fact that the owner of such certificate may have signed the transfer and power of attorney on the'back of the certificate, as no estoppel arises against such owner by reason of the execution thereof. Koch v. Willi, 63 Ill. 144, and Otis v. Gardner, 105 Ill. 436, distinguished.
    Bill in chancery. Appeal from the Superior Court of Cook county; the Hon. Georqe A. Dupuy, Judge, presiding.
    Heard in the Branch Appellate Court at the October term, 1907.
    Affirmed.
    Opinion filed May 19, 1908.
    Statement Tby the Court. The appellant filed his bill in the court below against appellee Crawford, the Chicago Union Traction Company and James H. Eckels and Marshall E. Sampsell as receivers of said traction company appointed by the Federal Court. He therein alleged that he was the equitable owner by purchase from brokers of a certain instrument in writing executed by the said receivers, called a certificate of indebtedness, No. 323, and officially certifying that the Chicago Union Traction Company was for value received indebted to Henry Crawford in the sum of $10,-815.24, with interest at 6 per cent, per annum, payable to the registered holder quarterly on the first day of October, January, April and July at the office of the treasurer of said company. 11 This certificate is one of the series bearing like interest made and executed by the undersigned as receivers of the Chicago Union Traction Company in conformity with an order of the United States Circuit Court, Northern District, Illinois, Northern Division, entered July 10, 1903, in suit of Guaranty Trust Company of New York v. Chicago Union Traction Company, reference to which order is hereby made.”
    It was further recited therein: “The claim upon which this certificate is issued has been audited and approved by the undersigned as receivers under said order as a valid obligation against the Union Traction Company. This certificate is registered and transferable only upon the books of the said company by ...................................................., or his attorney upon surrender of this certificate.”
    The order of court under which the certificate was issued and the petition of the judgment creditor on which the order was based are in the record. Such order makes such certificate a lien on all the assets in custody subject to the bonded indebtedness. The order provides in substance that any unsecured creditor of the traction company shall have the right to present his claim to the receivers, who should thereupon investigate and audit them, and if found correct, the receivers should issue and deliver to such creditor a certificate that the debt represented thereby had been duly proven as a valid debt against the estate of the Chicago Union Traction Company.

      The hill of appellant, made an exhibit of snch certificate and alleged that Crawford, the payee thereof, delivered the same to Whipple & Co., who were brokers, at Chicago, “to effect a sale thereof on account of Crawford”; that when so placed in the hands of the brokers the printed form of assignment had been signed by Crawford, but the three blanks in such form for the name of the assignee, the attorney in fact to transfer and the date had not been filled.
    Appellant thereupon alleged that on August 24,1905, he had employed Whipple & Co. to purchase stocks for him and deposited with such brokers $9,100 to be applied to such purchase; that Whipple & Co. failed to purchase the stocks which complainant ordered them to buy, and thereupon offered to complainant the certificate of indebtedness delivered to them by Crawford, to be sold by them as brokers, in the place of the stocks which the complainant had directed them to buy; that complainant accepted said certificate, and by virtue of implied authority of Crawford he had filled the blanks. The conclusion of law is then averred that by means of the premises complainant became the equitable owner of such certificate as against Crawford, Whipple, the traction company and its receivers.
    The bill alleged that on request the receivers had refused to accept the surrender of the certificate or to issue a new one to McCarthy. The prayer was that the court adjudge that he was the equitable owner of the certificate and entitled to a transfer, and reissue; that the receivers be decreed to accept such surrender and to issue a new certificate to complainant, and that Crawford be enjoined from setting up any claim of right, title or interest in such certificate.
    The answer of appellee Crawford admits the admin-, istration suit against the traction company, the issue to hirn by the receivers of certificate No. 323; that he employed Whipple & Co. as brokers to negotiate the sale of his certificate for cash at a designated price; the certificate itself was not delivered to such brokers when such defendant employed them, or for a considerable period thereafter. It was so delivered on the request of the brokers in order that any intending purchasers could inspect it; the signature of defendant on the blank assignment on the back had been placed there long before the employment of said brokers.
    At divers times prior to October 9, 1905, the brokers reported that they had been unable to obtain an offer for the purchase of the certificate on the terms fixed by defendant. On October 9, 1905, defendant demanded the immediate return of his certificate. The brokers informed him that it had been sent to New York to their correspondent. Defendant at once notified said brokers that such action was without authority and illegal and that such certificate must be immediately returned from New York and delivered to him. This was promised, but the certificate was not returned. On October 13,1905, a petition in bankruptcy was filed against the brokers and with their consent they were on that day adjudicated bankrupts and a receiver was appointed. After such adjudication the defendant ascertained that the statements of the brokers that they had sent his certificate to New York were false and fraudulent, and that the following facts were true:
    In August, 1905, McCarthy, the complainant, had employed the said brokers to purchase for his account 100 shares of Atchison, Topeka & Santa Fe Eailroad stock. The brokers through their New York correspondent, purchased the stock on a margin of $500 paid them by appellant. Thereafter, on August 28, 1905, McCarthy paid over to the brokers cash sufficient to fully complete payment for the shares and directed the brokers to fully pay for such shares and deliver them to him. The brokers reported that they had used the money paid them for that purpose and had ordered the shares so fully paid for to be sent to Chicago. All such statements were false and fraudulent. None of the money received by them from McCarthy was in fact used to pay for the stock purchased for him. The entire amount was misappropriated by the brokers and used to pay their own debts, and they were financially embarrassed and insolvent.
    In answer to the repeated demands of McCarthy for the delivery of his stock the brokers responded that the shares had been paid for in full, but that there might be a few days’ delay before they would be received in. Chicago. About September 8, 1905, the brokers having misappropriated the money received from McCarthy, secretly and without authority delivered defendant’s certificate of indebtedness to McCarthy, stating that he might hold it until the firm should deliver to him the 100 shares of Atchison stock which they reported they had bought for him. No consideration passed, at the time. It was a gratuitous and unlawful bailment of defendant’s property by his brokers.
    That McCarthy ever since has held the unlawful possession of such certificate and after the revocation of the brokers’ agency on October 9, 1905, and the adjudication in bankruptcy, he filled out the blank transfer to himself and tried to surrender the same and take out a new certificate to himself as registered holder.
    At the same time appellee Crawford filed his cross-bill setting up the same matters which are included in his- answer.
    He therein prayed that the court would decree that he was the lawful owner of the certificate and entitled to the provision thereof that the present assignment therein to McCarthy was placed there without consideration or authority and should be cancelled, and the plaintiff should be enjoined from setting up any title or right of possession and the certificate be surrendered to its true owner.
    Appellant’s answer to such cross-bill recites that possession of the certificate was obtained from the brokers under circumstances radically variant from the averments of his original bill.

      The answer expressly avers that the certificate “was sold to cross-defendant in the manner hereinafter more particularly set forth by the agents of cross-complainant, in whom he had vested such power of disposition over said certificate as to bind cross-complainant by the sale of said certificate by said agents of this defendant.”
    The answer of appellant to the cross-bill further alleged the employment of the brokers by McCarthy to purchase 100 shares of Atchison stock and his payment to them of the full price of all such shares, but in response to his pressure to deliver such stock the brokers replied that although such stock had been paid for there was some delay before the shares would reach Chicago. It admits that on “September 11, 1905, the brokers delivered said certificate to this cross-defendant, stating that he might hold the same until brokers should deliver his 100 shares of Atchison stock.”
    It admits that he has had possession of certificate No. 323 “ever since September 11, 1905, when he acquired it.” He alleges that he lawfully filled in the blanks on the prescribed assignment over the signature of Crawford because he purchased the certificate from the brokers for a valuable consideration.
    It is then averred that on August 25, 1905, appellant paid such brokers $9,116.30, to be used by them in the purchase of Atchison stock. They failed to buy, and thereupon they offered in place of the stock certificate No. 323 for ninety-five per cent, of its face value, which McCarthy accepted. Thereupon appellant paid for said certificate by the application to said purchase price of $9,116.30, which the brokers had received from McCarthy as bailees, and the balance of said agreed purchase price amounting to $1,158.19, the said McCarthy agreed to pay to the brokers. .
    On final hearing the original bill of appellant was dismissed for want of equity, and the court rendered a decree on the cross-bill of Crawford, finding that he was the lawful owner of certificate No. 323, subject to a lien of $875 for advances by the brokers. That the assignment to appellant on the back of the certificate was null and void because he had obtained the same from Crawford’s brokers without paying any present consideration therefor, and not in the usual course of business.
    Jule F. Brower and Samuel B. King, for appellant.
    Julius A. Johnson, for appellee; Charles H. Aldrich, of counsel.
   Mr. Justice Smith

delivered the opinion of the court.

The controversy here involved is over the ownership of the certificate of indebtedness.

Appellant insists that the decree of the Circuit Court be reversed and appellant be granted the relief prayed in his original bill, upon the following grounds, stated in his brief:

First. The question of the merits of the case was presented to the United States Circuit Court by the seventh ground of demurrer to the ancilliary bill filed in that court, which demurrer was sustained in its entirety and a decree for costs was rendered therein against appellee, the complainant in that suit.

Second. The instrument in question was quasi-negotiable in its character, and Crawford is estopped from disaffirming the act of the brokers whom he had constituted his general agents for the sale thereof, by the fact that Crawford had clothed his special agents, the brokers, with the indicia of ownership and with the unqualified power of disposition of the certificate; and Crawford is further estopped by the fact that he had recited, over his signature, that he, “for value received, have bargained and sold and-by these presents do bargain, sell and assign * * * the within certificate of indebtedness.”

Third. That Crawford had made a valid and binding sale of all this right in or to said certificate on October 11, 1905, and his only right with respect to said certificate is his right to recover of the brokers the amount of money he had agreed to accept therefor.

Fourth. The court erred in excluding the evidence of the fact that, according to the usual course of business between the brokers and their bank, the check tendered by the brokers in payment of the certificate would have been paid by the bank upon presentation.

Fifth. Since the cancellation of a past indebtedness or obligation is all the consideration a bona fide purchaser need show, the theory of the decree is wrong.

Sixth. Since the only basis for the finding of the decree that appellant did not acquire the certificate in the usual course of business, is the fact that he paid no present consideration for it, that theory of the decree must fail for the reason stated in the fifth ground above.

We do not think the proceedings in the United States Circuit Court shown by the record are a bar to the prosecution of this suit. The special demurrer filed in that court presented the ground that no diversity of citizenship between the parties was averred in that bill, and other jurisdictional grounds, and that therefore the court was without jurisdiction as a federal court to hear and determine the controversy presented in the bill. The conclusion is obvious from the record that the demurrer was sustained on jurisdictional grounds, and not on the ground that the bill did not show any equity in favor of the complainant against the defendant. This is shown conclusively by the opinion of the United States Circuit Court of Appeals in that case, appearing in the record before us. A decree for costs would logically follow when the complainant elected to stand by his bill, and this should not, in our opinion, be held to be a bar in this case to relief on the merits on the cross-bill of appellee.

In form and substance the bill of appellant seeks to obtain a specific performance of an alleged lawful sale of the certificate of indebtedness made by Whipple & Co. as the agents of appellee who was the registered owner of the indebtedness or claim evidenced by the certificate. The theory of relief presented is based upon the ownership of Crawford, his employment of Whipple & Co. as brokers and a lawful sale made by them to appellant. And, in line with that theory, it is here contended that the sale by the brokers was not in violation, but in fulfillment of the purpose for which the certificate was placed in their hands; and that the wrong of the brokers consists, not in having sold the certificate to appellant, but in their failure to account to Crawford for the purchase price thereof.

Appellant’s pleadings admit that Crawford was the registered and absolute owner of the certificate at the time of the alleged sale thereof, and that as such owner he employed the brokers to negotiate a sale for his account. And appellant’s pleadings set up that he obtained his title through a lawful sale by Crawford’s agents, who had possession of the certificate as bailees and fiduciaries, without any color of ownership or right of property therein.

The record thus presents the question whether the pleaded and proven acts of the brokers in respect of the certificate were within the scope of their agency, and were legally sufficient to transfer ownership of the indebtedness evidenced by the certificate from Crawford to McCarthy.

We deem it important at this point to consider what this certificate is,—what is its legal effect and purpose.

In appellant’s briefs, and in oral argument, it is contended and spoken of as a security of a quasi-negotiable character, and that McCarthy’s alleged purchase of it should be considered upon the same basis as if he had acquired in good faith before maturity and for value an instrument, the title to which could be passed by mere delivery.

This view of the instrument is not sound. The order of court appearing in the record under and in pursuance of which the certificate was issued provides that, with the consent of all parties, the receivers of the Chicago Union Traction Company audit claims of creditors who may present them, and if found to be a just and valid debt of said company, they shall issue for such claim one or more certificates as such receivers, declaring that the claim has been audited and approved by the receivers as a valid debt against the estate of said company for the amount stated therein and interest,- and that the lawful holder of each of such certificates is entitled to share in all payments and distribution of assets of said company, and shall stand on a parity with the complainant in said suit. The court’s order makes the claim represented by the certificate a charge on the corporate assets subject to the bonded debt.

When a certificate is issued under this order it represents a fully-matured liability and entitles the holder thereof to a standing in that receivership case. It is not an unconditional promise of anyone to pay a specified sum of money. No suit could be brought thereon against anyone for a money recovery. It is not a substantive obligation, but is mere evidence of an indebtedness proven against an estate under an administrative order for the purpose of administering the estate, and entitles the holder to a distributive share when the amount thereof has been determined and distribution ordered.

The office and effect of such a certificate is stated in Richmond v. Irons, 121 U. S. 52, as follows: “If he proves such a claim, then he does prove himself to be a creditor, and as such is entitled to come in under the decree, and has a right to be considered as a party complainant from the beginning by relation to the time of filing the bill. ’ ’

This, we think, is the sole office or effect of the certificate; and it is neither negotiable nor quasi-negotiable. Turner et al. v. P. & S. R. R. Co., 95 Ill. 134.

When it is further considered that the order of court required the certificate to be registered by the court officials, and that interest was to be paid only to the registered owner, and that the title of any alleged assignee would not be recognized except on condition of a surrender of the old certificate and taking-out a new registration, the theory that title thereto could be passed by mere delivery finds little support in the record.

By the allegations of the original bill it appears that Crawford placed the certificate in the hands of the brokers for sale, and at the same time signed the assignment and power of attorney on the back of the certificate leaving the blank for the name of the transferee and of the attorney in fact and the date not filled; that the same brokers had been employed by McCarthy to purchase certain stocks for him, and that on August 24, 1905, McCarthy had paid to them nine thousand one hundred dollars to be applied by the brokers to the purchase of such stocks. The brokers had failed to purchase the stocks as ordered, but offered to McCarthy the certificate in question in place of the stocks, and that McCarthy accepted the certificate and filled in the blanks in the assignment and power of attorney.

Crawford’s answer and cross-bill averred that the brokers had misappropriated all the moneys which they had received from McCarthy to buy stock for him and did not make any purchase for him, and being pressed by McCarthy to deliver the stock, they falsely reported to him that the shares had been purchased but there was some delay attending the transfer thereof; and that on or about September 8, 1905, the brokers fraudulently delivered the certificate then in their custody as brokers to McCarthy to hold in pledge until they should deliver the stock which he had ordered purchased. These averments are admitted by McCarthy in his answer to the cross-bill, and the facts are proved by the testimony of McCarthy and Nugent, the brokers ’ cashier. Nugent also testified that the certificate did not come into the possession of the brokers until after McCarthy paid the money to the brokers for the purchase of the stock, and it had all been used and paid out by the brokers, who were then insolvent and in a failing condition, for their own use.

McCarthy states in his testimony that at the time the certificate was delivered to him he did not agree to buy it, or pay any money for it. He simply signed a receipt for it, acknowledging the receipt of the certificate as security for the delivery of the stock. After holding the certificate in this way four or five days, McCarthy testifies, he asked Whipple if it was for sale, and Whipple replied it was for sale. McCarthy questioned Whipple as to the ownership, and a price was agreed upon for the certificate, and McCarthy purchased it from Whipple by applying his credit on Whipple & Co.’s books of $9,116.30 on .the purchase price of the certificate, and a memorandum was made to that effect, dated October 11, 1905. The price agreed upon for the certificate was ninety-five cents on the dollar for the face value of the certificate amounting to $10,274.49. The balance of the purchase price, $1,158.19, was never paid.

The certificate on its face notified appellant, McCarthy, that the indebtedness which it evidenced was due to Crawford, and pointed him to the order of court under and in pursuance of which it was issued; and that the certificate itself was transferable only on the books of the company. This was notice that at the time he received the certificate and at the time of his alleged purchase Crawford was its owner, and that Whipple & Co. were not its owners. It put McCarthy on inquiry as to Whipple & Co.’s authority to deal with the paper in their hands. It pointed out the person of whom such inquiry should be made. The certificate, and the well known fact to him that Whipple & Co. were brokers were notice to appellant of the fiduciary character of the brokers, and that the certificate was trust property in their hands and that they could not deal with it for their own personal benefit. In Meacham on Agency, sec. 994, the learned author thus states the doctrine on this subject:

“Nor does it make any difference that the pledgee was ignorant of the extent of the factor’s authority, or supposed him to be the real owner of the goods. As in the case of other agents, the person dealing with the factor must ascertain the extent of his authority, and omits to do so at his peril.

This rule operates to prevent a transfer or indorsement of the bill of lading by way of security for the factor’s debt, as well as the actual delivery of the goods themselves in pledge. Nor can the power arise from usage.”

Chancellor Kent held in the early case of Rodrigues v. Hefferman, 5 Johnson’s Ch., 417-429: “It is an old settled and understood rule, that a factor cannot pledge, even though the creditor1 have no notice of his character as factor. In such a case every creditor trusts and deals at his peril.”

This doctrine was adopted by the Supreme Court in Potter v. Dennison, 5 Gilm. 590-598, in the following language: “And yet the principal, whenever his factor has bartered or otherwise disposed of the goods in a manner not within the ordinary and accustomed modes of transacting the like business, may follow and reclaim the property; and in such a case, it is wholly immaterial whether the person dealing with the factor, knew him to be such or not.” Citing Story’s Agency, secs. 224, 225; Dunlap’s Paley’s Agency, 219. To the same effect are many later cases in this state. Berry v. Allen, 59 Ill. App. 149; Bertholf v. Quinlan, 68 Ill. 297; Gray v. Agnew, 95 id. 319; First National Bank v. Schween, 127 id. 573; Clemmer v. Drovers Nat. Bank, 157 id. 206.

In the Federal Courts the absolute disability of brokers to pledge or otherwise transfer property contrary to the usage of trade, and for -their own benefit, is declared by many decisions. In Warner v. Martin, 11 How. 209, it was held that a factor has no power to transfer the title of his principal to goods consigned to him for sale, in payment of a precedent debt due from himself. And a creditor who receives the goods under such an arrangement, as well as his vendee, though acting in good faith, and in ignorance of the fact that the goods did not belong to the factor, acquires no title as against the principal. The case of Union Stock Yards Bank v. Gillespie, 137 U. S. 411, is directly in point.

The evidence is undisputed and abundantly warrants the inference that Whipple & Co. undertook to pledge the certificate to appellant as security for their debt to him; and they afterwards attempted to sell it to appellant for the same consideration in part. These transactions were fraudulent and void as to Crawford and did not pass Crawford’s title to appellant.

In our opinion the fact that Crawford signed the transfer and power of attorney on the back of the certificate does not estop him to deny the facts recited therein. Appellant is not entitled to protection, upon the evidence in the record, against the fraud of the brokers, upon the principle that where one of two innocent persons must suffer for the fraud of a third, he who made it possible for the loss to occur must bear the loss. McCarthy was not an innocent person in the transaction under consideration. As we have seen, he was put upon inquiry, and is chargeable with all the knowledge which such inquiry would have brought to him. He had no right to infer from the assignment in Hank that Whipple & Co. were the owners of the certificate, or had the right to pledge or otherwise dispose of it for their own use.

Appellant relies with apparent confidence upon Koch v. Willi, 63 Ill. 144, and Otis, Admr., v. Gardner et al., 105 Ill. 436. We think these cases differ- so materially in their controlling facts, and the relations of the parties to each other, from the case at bar, that they required the application of different principles from those which should be applied to the facts disclosed in this record.

We think the decree of the lower court is right and must be affirmed.

Affirmed.


text:
    John F. Devine, Administrator, Appellant, v. Mary E. Healy, Executrix, Appellee.
    Gen. No. 13,993.
    1. Statutory law—rule of construction. Where a statute previously existing in another state or in England has been adopted in this state, the construction which at the time o£ adoption had been placed upon such statute by the courts of such other state and England, will be given great weight by the courts of this state in ascertaining its meaning. '
    2. Lord Campbell’s Act—effect of adoption of Illinois statute. The "statute of this state which is a substantial copy of Lord Campbell’s Act, which gives a right of action to the personal representative of a person killed by the wrongful act of another, does not work a simple devolution of the cause of action which the deceased would have had to and upon his personal representative, but it is an entirely new cause of action, created by the statute. This statute, likewise, does not in terms or by necessary implication make any change in the common law rule as to the liability or nonliability of the executor or administrator of the wrong-doer.
    3. Negligence—when action for, does not lie against personal representative of wrgng-doer. No action lies against the executor or administrator of one whose wrongful act has caused the death of another. McIntyre v. Sholty, 121,Ill. 660, distinguished.

      Action in case for death caused by alleged wrongful act. Appeal from the Superior Court of Cook county; the Hon. Axel Chytratjs, Judge, presiding.
    Heard in the Branch Appellate Court at the October term, 1907.
    Affirmed.
    Opinion filed May 19, 1908.
    Búheteles, Burry & Johustoue, for appellant; Guy M. Peters, of counsel.
    Gorham: & Wales, for appellee; Whliam H. Duval, of counsel.
   Mr. Justice Smith

delivered the opinion of the court.

This is an appeal by the plaintiff below from a judgment of the 'Superior Court sustaining a demurrer to the plaintiff’s amended declaration and dismissing the suit at the costs of the plaintiff.

The amended declaration avers that John M. Healy, defendant’s intestate, was on April 20, 1906, a general contractor engaged in laying water mains in Lake county, Illinois, in a public street. On that date Frank Biggs, plaintiff’s intestate, was in the employ of said Healy as a calker, and was working at the bottom of a ditch which had been dug by Healy’s men, engaged in calking a water main, and a large part of the wall of the ditch caved in and fell upon Biggs, killing him instantly; that Frank Biggs left him surviving his father, his mother, and brothers and sisters, naming them, and that all of them are still living and were dependent upon said Frank Biggs, in whole or in part, for their support, and have been deprived of his support because of his death.

The amended declaration was filed July 18, 1907, and alleges that July 16, 1906, Healy died, and Mary E. Healy, the defendant, was appointed executrix of his will; and that in April, 1907, letters of administration on the estate of Frank Biggs, deceased, were' taken out by the plaintiff as public administrator.

A general demurrer was filed to the amended declaration. The defendant insisted that the cause of action was not one that survived against the representative of the defendant. The demurrer was sustained. The plaintiff elected to stand by his declaration, and the case was dismissed.

The question presented is: Can this action be maintained against the personal representative of the tortfeasor?

At common law, there was no action in favor of the representative of one whose death was caused by the wrongful act of another. For an injury to another negligently inflicted the wrongdoer had to respond. If his negligence caused the death of the injured party, the wrongdoer went free. This was felt to be an injustice, and accordingly Parliament passed what is known as Lord Campbell’s Act (9th and 10 Vict. C. 93), giving a right of action for death of a person caused by wrongful act, neglect or default, for the benefit of certain designated surviving relatives. New York passed a similar statute in 1847, and Illinois followed by adopting the Act of February 12, 1853, which was a copy of the New York statute, and under which this action is brought.

Section 1 of the Act of 1853 is said to be a verbatim copy of the corresponding section of Lord Campbell’s Act, and is as follows (Revised Statutes, ch. 70, sec. 1):

“Whenever the death of a person shall be caused by wrongful act, neglect or default, and the act, neglect or default is such as would, if death had not ensued, have entitled the party injured to maintain an action and recover damages in respect thereof, then in every such case, the person who, or company or corporation which, would have been liable if death had ensued, shall be liable to an action for damages, notwithstanding the death of the person injured, and although the death shall have been caused under such circumstances as amount in law to a felony.”

Since this statute is a copy of the New York statute which in turn is taken from Lord Campbell’s Act, the construction placed upon it by the English and New York courts should have great weight in determining the construction to be placed upon it. From these authorities we think it is clear that the present action is not brought to enforce the right which the common law gave to the deceased. The statute does not work a simple devolution of a cause of action which the deceased would have had to and upon his personal representative, but it is an entirely new cause of action, created by the statute, which is here sought to be enforced. The statute does not profess to revive the cause of action which deceased would have had, if death had not ensued, in favor of the executor or administrator. That was extinguished by his death. But, as said in Holton v. Daly, Admr., 106 Ill. 131, 137, after quoting the second section of the Act: “In construing this section this court said in City of Chicago v. Major, 18 Ill. 349, 356: ‘The legislature intended that the money recovered should not be treated as a part of the estate of the deceased. They designed to exclude the creditors from the benefit of it, and to prevent its passing by virtue of any provisions of the will of the deceased. The personal representatives bring the action, not in the right of the estate, but as trustees for those who have more or less direct pecuniary interest in the continuance of the life of the deceased, and who have some claim at least upon his or her natural love and affection.’ ”

This construction of the statute is sustained by Legott v. The Great Northern Ry. Co., 1 Q. B. Div. 599; Whitford v. Panama Ry. Co., 23 N. Y. Rep. 470, and cases cited in Holton v. Daly, supra.

While, as we have seen, the cause of action created by the statute is not in right of the estate of the deceased, but is “for the exclusive benefit of the widow and next of kin of such deceased person,” and the measure of recovery is not the same, still, the cause of action is the “wrongful act, neglect or default,” resulting in death, and the action is for a tort. The demurrer raises the question—Can this action he maintained against' the personal representative of the wrongdoer?

Blackstone says: “And in actions merely personal, arising ex delicto, for wrongs actually done or committed by the defendant, as trespass, battery and slander, the rule is, that actio personalis moritur cum persona; and it never shall be revived, either by or against the executors or other representatives,-—for neither the executors of the plaintiff have received, nor those of the defendant have committed, in their own personal capacity, any manner of wrong and injury.” Vol. 2, Cooley’s Blackstone, 362.

At common law, neither the executor nor heir was to answer for the. personal tort of the decedent. Tooley v. Windham, Cro. Eliz., 206; Baily v. Birttes, T. Raym. 71. “No action,” said Lord Mansfield, “where in form the declaration must be guare vi et armis et contra pacen, or where the plea must be that the' testator was not gnilty, could be against the executor; upon the face of the record, the cause of action arises ex delicto; and all private criminal injuries or wrongs, as well as all public crimes, are buried with the offender.” Cowp. 375. “Executors and administrators,” said Lord Ellenborough, “are the representatives of the temporal property, that is the debts and goods of the deceased, but not of their wrongs, except where those wrongs operate to the temporal injury of their personal estate.” Chamberlain’s Admr. v. Williamson, 2 M. & S., 415; Vol. 3; Robinson’s Practice, 288; Mellen v. Baldwin, 4 Mass., 480; Cravath v. Plympton, Admr., 13 Mass. 453.

The act approved February 12, 1853, changed this rule, as we have already indicated, as to the right of action, and by whom and for whose benefit the recovery may be had. That act, however, does not, in terms or by necessary implication, make any change in the common law rule above stated, as to the liability or non-liability of the executor or administrator of the wrongdoer.

It is contended by counsel for appellant that this act of 1853 should be construed in connection with section 122, chapter 3 of the Revised Statutes, which is as follows:

“In addition to the actions which survive by the common law, the following shall also survive: Actions of replevin, actions to recover damages for an injury to the person (except slander and libel), actions to recover damages for injury to real or personal property, or for the detention or conversion of personal property, and actions against officers for misfeasance or non-feasance of themselves or their deputies, and all actions for fraud or deceit.”

And it is argued that this action is one for the recovery of damages for injuries to the person resulting in death, and that the cause of action is the wrongful act; and since the estate of one who injures another wrongfully must respond in damages, there is no reason in the nature of things, why the estate of • the wrongdoer should escape if the wrong is greater, and the injury results in death.

We think, however, the survival statute above quoted providing for the survival of “actions to recover damages for an injury to the person” refers to common law actions for that purpose, and not to the action authorized by the statute of 1853, which gives an action, unknown to the common law, not to recover damages for injury to the person, but to recover for the pecuniary loss to the widow and next of kin occasioned by the death of the person caused by the wrongful act.

In Holton v. Daly, Admr., supra, the court, after discussing the acts under consideration, said: “We feel, therefore, constrained to hold the act of 1872 was not intended to apply to cases embraced by the act of February 12, 1853.”

In Davis v. Nichols, 54 Ark. 358, Curtner, the wrongdoer, died while an action was pending against him under a statute modeled after Lord Campbell’s Act. An attempt was made to revive the action against his administrator, and the question was, could the cause be revived against his administrator? In the course of a well-considered opinion the court, at page 361, says:

“But the cause of action which survives to the administrator upon the death of one who has received physical injury does not inure to the benefit of the widow and next of kin. The action which is prosecuted for their benefit is not founded on survivorship, but is a new cause of action which death itself originates. It begins where the action which survives ends. * * * It follows that the action prosecuted for the benefit of the widow abated upon the death of Curtner, the wrongdoer.” Norton v. Wiswall, 14 Howard’s Prac. 42, and Hegench v. Keddie, 99 N. Y. Rep. 268, are interesting cases, deciding the same question under similar statutes.

Mr. Justice Caton, in City of Chicago v. Major, supra, in discussing the act of 1853, said: “This is a new cause of action given by this statute and unknown to the common law and should not be extended beyond the fair import of the language used.”

If this statute gives a new cause of action for the recovery of the loss to the widow and next of kin, it alone controls the recovery thereunder and the terms of the statute itself must decide and determine the scope of the rights granted by it. The statute is silent as to any right to hold the executor or administrator of the wrongdoer liable for the cause of action given by it. The statute does not éxtend that right of acition beyond the wrongdoer himself. It does not, expressly or impliedly, impair the familiar common law rule that the wrongdoer and the wrong are buried together. Courts ought not to extend the terms of the act beyond their natural and plain import, where the legislature has failed to give any intimation of such an intent in the act itself.

It is contended, however, on behalf of appellant that the question of maintaining an action of this character against the administrator of the tort-feasor has been settled in this state in McIntyre v. Sholty, 121 Ill. 660.

It cannot be doubted that the question was squarely involved in that case. But the only question argued in that case, and the only question decided by the court, was the liability of an insane person in a civil action for torts he may have committed. We do not think the Supreme Court is bound by such a decision as to a grave question of the construction of a statute, when the question, though necessarily involved in the case, was not suggested or argued. For that reason we do not follow the decision.

We think the ruling of the court on the demurrer to the declaration was correct, and the judgment is affirmed.

Affirmed.


text:
    Antonina Kiolbassa, Appellant, v. The Polish Roman Catholic Union of America, a corporation, et al., Appellees.
    Gen. No. 14,012.
    1. Fbatebnal benefit societies—what interest in certificate enforceable in equity. A benefit certificate issued to one who may be lawfully named as beneficiary will be enforced in equity in favor of such beneficiary notwithstanding an attempted change by the members, if it appears that such beneficiary has made a loan to such member upon the faith of such certificate.
    2. Fbatebnal benefit societies—when change of beneficiary effected. Held, under the evidence in this case, that a change of beneficiaries had been duly effected, notwithstanding the old certificate was not surrendered as provided by the by-laws, it appearing that such old certificate had been lost or misplaced and a written request for a new certificate made.

      3. Evidence—what testimony of wife incompetent. A wife is not permitted to testify to conversations between herself and her husband where the interests of a third party are involved.
    Bill of interpleader. Appeal from the Superior Court of Cook county; the Hon. Willabd M. MoEwen, Judge, presiding.
    Heard in the Branch Appellate Court at the October term, 1907.
    Affirmed.
    Opinion filed May 19, 1908.
    Statement by the Court. March 7, 1906, The Polish Roman Catholic Union of America, a fraternal insurance society, filed its bill of interpleader in the Superior Court, making Antonina Kiolbassa, appellant, and Kosciol Sw. Stanislava Kostki, parties defendant, and praying that they be required to inter-plead as to their conflicting claims for the amount due from complainant under certain certificates of membership issued during his life time to one Peter Kiolbassa, a deceased member.
    Both of the defendants filed answers to the bill, and complainant filed its replications to such answers.
    The usual order for the defendants to interplead was entered. Complainant deposited with the clerk of the court the amount, $750, claimed under the certificates, and was dismissed out of court with its costs.
    Appellant amended her answer by alleging a loan of $1,000 made by her to said Peter Kiolbassa and the delivery by him to her of a certificate issued by the complainant, dated March 23, 1904, numbered 181, for $750, payable to her upon the death of said Peter Kiolbassa, as part security for the loan; and that if a certificate was issued by complainant under date of June 15, 1905, designating defendant, Kosciol Sw. Stanislava Kostki, a beneficiary she had no knowledge thereof, except from the bill, and that such certificate, if any, was not issued in accordance with the statute, and laws of said society, and was void and of no effect.
    On the hearing' before the learned chancellor a decree was entered sustaining the validity of the June 15, 1905, certificate, and ordering the payment by the clerk to said Kosciol Sw. Stanislawa Kostki of the sum of $450, and to the appellant the sum of $300, less complainant’s costs, taxed at $63.50. This appeal is prosecuted from the decree.
    Joseph A. Casey, for appellant.
    1ST. L. Piotrowski, for appellee; John P. Mahon, of counsel.
   Mr. Justice Smith

delivered the opinion of the court.

The beneficiary certificates shown in the record contain the usual provisions in such certificates to the effect that the member must comply in the future with the constitution, laws, rules and regulations governing said Union and its funds, at the time the certificate was issued, and that might thereafter be enacted by the Union, and that such rules, regulations and laws are made a part of the certificate; and particularly, that any benefit to be paid thereunder or any beneficiary named therein might be revoked, altered or changed, and substitution had at the request in writing of the acceptor of the certificate. Such request was to be made in accordance with the laws of the Union then in effect and governing the manner and form thereof, and such change must be approved by the proper officers of the Union before becoming effective.

Chapter 3, section 199, of the constitution and bylaws of the Union provides:

“Any member holding a beneficiary certificate desiring at any time to make a new direction as to its payment may do so by authorizing such change in writing on the back of the certificate in the form prescribed, attested by the secretary, with the seal of the society attached, and by the payment to the general secretary of the sum of 50 cents. But no change of direction shall be valid or have any binding force or effect until such change shall have been reported to the general secretary, the old certificate, if possible, filed with him, the change approved by the Executive Council and the new beneficiary certificate issued and said new certificate shall be numbered the same as the old certificate and be endorsed as having been issued upon the surrender of the old certificate, and all other formalities provided for upon the issuance of an original certificate shall be complied with upon the issuance of a changed, altered or new certificate, provided should it be impracticable for the recording secretary to witness the change desired by the member, attestation may be made by a notary public or an officer of the court of record, seal to be attached in attestation.”

Section 200 of the constitution and laws of the Union is as follows: “Parol evidence of a member’s intention or desire to change his beneficiary must be disregarded. ’ ’

Section 201 provides:

“In case a benefit certificate is lost or beyond a member’s control the member may in writing surrender all claim thereto and .direct that a new certificate be issued to him payable to the same or a new beneficiary or beneficiaries in accordance with the laws of the Union upon making affidavit of the facts in the case and upon the approval of the same by the society, and such facts being satisfactory to the Executive Council and paying a fee of 50 cents.”

The record shows that on or about June 15, 1905, Peter Kiolbassa signed the following document of that date, addressed to the general secretary of the Union:

“Dear Sir:

I, the undersigned, ask to have the certificate wherein my wife, Antonina Kiolbassa, is the beneficiary for the sum of Seven Hundred and Fifty ($750.00) Dollars, issued to me by said Union cancelled and made null and void, and direct that a new one be issued to me for the same amount, as follows: To Antonina Kiolbassa, my wife, the sum of Three Hundred ($300.00) Dollars,.and to the Church of Sw. Stanislawa Kostki, Chicago, Illinois, the sum of Four Hundred Fifty ($450.00) Dollars, hereby revoking and cancelling all other certificates issued to me prior to above date by the Polish Roman Catholic Union of America.

Signed in presence

Peter Kiolbassa.”

On that date the Union issued a new certificate to Peter Kiolbassa wherein appellant, his wife, was made.a beneficiary for $300, and appellee Kosciol Sw. Stanislawa Kostki, Chicago, Ill., was made a beneficiary for $450.

It is conceded that the Complainant Union was formed to include in its membership only the membership of the Roman Catholic Church. Under the amendment of the statutes relating to Fraternal Insurance Associations made in 1901, benefits might be made payable to religious or charitable institutions. No question, therefore, of want of authority under the statute, and by-laws of the Union, to make appellee a beneficiary in the certificate is raised by the record or presented for consideration.

The claim of appellant to the entire fund of $750 named in the certificate No. 181 issued March 23,1904, is based upon an alleged loan of $1,000 which she testifies she made to her husband about the date of the certificate, upon his promise to have his life insured for $1,000 for her benefit. She testifies that she gave him the money which he used for his own separate use, and that he thereafter handed her the certificate of March 23, 1904, for $750 in which she was the sole beneficiary; that she accepted the certificate as security for the repayment of the money loaned to bim, and that it has remained in her possession from its delivery to her. No part of the sum loaned by her to her husband has ever been repaid to her.

Appellant also testifies that about two weeks before her husband’s death, she went to his bedside in company with Theresa Gorski, a young lady who lived in the same building, and that her husband drew from under the pillow of his bed an unexecuted policy and a written request for a change of beneficiary, and told her that the Eev. Andrew Spetz and Frank Kwasigiock had left the papers for him to sign and that he had refused. He also said to her that the money which would come in the event of his death, as the proceeds of the certificate of March 23, 1904, belonged to her, and was little enough; that he owed her a great deal more, and asked her where the certificate was, and upon being informed, he told her to take the unexecuted papers and carefully preserve them with her certificate.

Theresa Grorski substantially corroborates in her testimony appellant’s account of the bedside conversation between appellant and her husband.

Appellant contends upon this testimony that Kiolbassa pledged and transferred equitable rights in the certificate as security for the loan made by her to appellant, which will be enforced in equity; and that appellee, designated as a beneficiary in the new certificate, a mere volunteer, having parted with no consideration, will not be protected in equity, as against appellant, the beneficiary in the original certificate who has a vested equitable interest therein.

It cannot be questioned successfully that if appellant’s contention as to the facts is established by the evidence her equitable rights may be enforced in equity. Ptacek v. Pisa, 231 Ill. 522. If the evidence shows that appellant made the loan to her husband, as testified to by her, and the original certificate was taken payable to her as security therefor, and the loan was never paid, appellant has equitable rights in the certificate and the proceeds thereof which a court of equity ought to enforce.

It appears from the evidence in the record that the only testimony tending to show a loan from appellant to her husband, and that he procured the certificate in question to be issued to him payable to her, as security for the loan, in pursuance of an agreement with appellant to that effect, is the testimony of appellant as to certain conversations between herself and her husband. No evidence in writing of the agreement is shown in the record. Objection was made by appellee to the testimony of appellant to the conversations, and appellee now insists that her evidence as to such conversations was not competent under the proviso in section 5, chapter 51, of the Revised Statutes.

In our opinion, appellant was not a competent witness to testify to the conversations detailed in her testimony, and her testimony on that subject must be disregarded.

The theory and the facts set up in appellant’s answer and testified to by her are contradicted and proven to be untrue by the facts and circumstances shown by the evidence offered in behalf of appellee. It appears that the deceased, Kiolbassa, was a member of the complainant society from its organization, and that he was at one time prior to the taking out of the certificate dated March 23, 1904, payable to appellant, the general president of complainant; that he had held from the organization of the society a certificate for the same sum of money payable to Paulina Kiolbassa, his first wife, and after her death and his marriage to appellant, he caused his certificate to be changed and made to appellant. The Rev. Father Spetz and Frank Kwasigiock both flatly deny that they left the papers—an unexecuted certificate and a request for a change of beneficiary—with Kiolbassa. And Theodore Ostrowski, treasurer of the complainant, gives in detail a conversation with Kiolbassa in which the latter expressed his wish to have a change made in his certificate; and that the papers were prepared by the witness and were left with Kiolbassa by the witness. He further testified that new papers were prepared, and he left them with Kiolbassa’s physician in the hospital to which he had been removed.

It appears from the evidence that Kiolbassa in a conversation with the president of the complainant Union expressed his intention to change his certificate so that it should be made payable $300 to his wife, and $450 to St. Stanislaus Church, and thereupon the president of the Union instructed the secretary to prepare the papers accordingly.

In our opinion the evidence shows that the change in the certificate was made at Kiolbassa’s request, and disproves any theory of fraud upon appellant, or undue influence upon the deceased, to change the designation of the beneficiary in his certificate in favor of the appellee.

We think the conclusion is warranted from the evidence that no vested rights in the certificate dated March 23, 1904, or the proceeds thereof, existed in favor of appellant when Kiolbassa caused a new certificate to be issued changing the beneficiaries as therein stated.

As to the apparent irregularity in issuing the new certificate without requiring a surrender of the existing certificate as provided in the by-laws of the Union, the evidence shows that the deceased made search for the certificate in his desk where he supposed it was, and that he failed to find it. Supposing it to be misplaced or lost, he then signed the written request for a new certificate shown in the record. Niblack on Benefit Societies and Accident Ins. (2nd ed.), sec. 222; Martin v. Stubbings, 126 Ill. 387.

The evidence, we think, supports the decree, and the decree is affirmed.

Affirmed.


text:
    Beth Moshav Z’Keinim of Chicago, Appellant, v. Grand Lodge Independent Western Star Order et al., Appellees.
    Gen. No. 14,017.
    1. Fraternal benefit societies—effect of assignment of certificate. A fraternal benefit certificate is not assignable at law, but all beneficial interests therein may be enforced in equity, except insofar as the statute operates to prevent assignment.
    2. Fraternal benefit societies—when assignment of certificate will not he enforced in equity. The assignment of a benefit certificate to one not a lawful beneficiary under the statute, will not be enforced in equity where the question of the unlawfulness of the beneficiary is set up by the society, and this notwithstanding the acceptance of dues and assessments from such unlawful beneficiary.
    Bill for injunction. Appeal from the Circuit Court of Cook county; the Hon. Thomas G. Windes, Judge, presiding.
    Heard in the Branch Appellate Court at the October term, 1907.
    Affirmed.
    Opinion filed May 19, 1908.
    Statement by the Court.' Appellant, Beth Moshav Z’Keinim of Chicago, a charitable corporation supporting and conducting a Jewish Home for the Aged, filed its original bill in the Circuit Court for the purpose of restraining appellee, Grand Lodge, Independent Western Star. Order, from paying to appellee, Bertha Greenbaum, the sum of $500 due under a benefit certificate of her husband Wolf Greenbaum, issued by the Western Star Order, a fraternal beneficiary society, organized under the laws of this State.
    The bill sets forth that the complainant is carrying on and supporting an Orthodox Jewish Home for the Aged in Chicago, and that it is supported entirely by voluntary contributions,; that no particular requisite for admission to the home is required, except that applicants be worthy, and that they conform to the laws, rules and regulations of the home.
    It alleges that on or about February 1, 1904, one Wolf Greenbaum and his wife, Bertha Greenbaum, defendant, applied for admission to the home; that they were "without means of support, and were required to sign in accordance with the rules of the home applica tions for admission setting forth that they were holders of certificates in the defendant order in the sum of $500 each, and that the by-laws of said home had been read and explained to them and that they made the statements therein contained as to property or income in compliance therewith; arid sets out the rules and by-laws of the home. In said application the appellee promised if admitted to the home to observe all the laws, rules and regulations then in force, and all others to be thereafter adopted.
    The bill further alleges that in the by-laws of the home it is provided that any person entering the home as an inmate shall deliver all property of any and all description to said home; that section 6 of article 10 provides: “That applicants who are members of any endowment society, shall be required to assign to the home before admission, all benefits resulting from said membership.” These provisions are set out at length in the applications.
    'Said Greenbaums signed applications and entered the home about July 15, 1904, and lived there respectively as follows: said Wolf Greenbaum until August 19, 1906, when he died, and said Bertha Greenbaum resided there until the day before the filing of the bill of complaint herein.
    The bill shows that in accordance with said by-laws, both said Wolf Greenbaum and the said Bertha Greenbaum delivered to complainant their respective benefit certificates in the said Western Star Order, numbered respectively 102 and 103, which are still in the hands of complainant; that complainant has paid since January 1, 1905, all the dues and assessments due upon both the said certificates amounting to the sum of $31.45.
    Upon the death of said Wolf Greenbaum, "complainant requested said Bertha Greenbaum to sign certain papers, and to give certain assistance to enable complainant to realize the sum of $500 on the benefit certificate of said Wolf Greenbaum, but she refused so to do; and that thereupon complainant gave notice to the defendant Order that it claimed the said amount by reason of being the assignee of said certificate, and that said Order has acquired and holds a voucher for $500 which it claims it will pay over to Bertha Greenbaum unless restrained by the injunction of some court. The insolvency of said Bertha Greenbaum, and her inability to respond to any claim or suit for $500 or any part thereof is averred.
    Defendants demurred, generally, to the bill, and after the demurrer had been sustained, the complainant amended its bill averring that the defendant order and its officers had full knowledge of the assignment by Bertha Greenbaum of her interest in the benefit certificate issued to Wolf Greenbaum, and that said order received such dues and assessments paid by complainant with knowledge of said assignment and with knowledge that said dues and assessments were being paid by complainant.
    The amendment sets forth that since the said G-reenbaums entered said home they were supported and maintained by complainant exclusively, were fed, clothed, lodged and taken care of by complainant, and furnished medical treatment, in consideration of and relying upon the assignment of said benefit certificates, all of which was reasonably worth for each of said parties the sum of five dollars per week, which is less than the actual cost thereof. The amendment then asks the additional relief that said order be decreed to pay to complainant the sum of five dollars per week for each of said Greenbaums respectively while they were so maintained and cared for, and also such sums as complainant has laid out for dues and assessments.
    Upon a general demurrer to the bill as amended, the court sustained the demurrer, but found the complainant is entitled to be reimbursed in the sum of $31.45, being the amount paid out by it for dues and assessments upon said certificates; and the defendants having in open court paid into court said sum for use of the complainant, the bill of complaint as amended was ordered to be dismissed for want of equity at the defendants’ costs. This appeal followed.
    Israel Cowen, for appellant.
    Wharton Plummer, for appellees; Joseph Epstein, of counsel.
   Mr. Justice Smith

delivered the opinion of the court.

The decree of the Circuit Court is peculiar in that it recognizes an equity in the complainant, and upon the payment into court of a certain amount of money for the use of the complainant, sustains the demurrer to the bill as amended, and dismisses the bill at defendants’ costs. But appellant states in its argument that its purpose is to ask this court to disregard any formal pleading and to meet and decide the legal questions involved, and no argument is made on the form of the decree.

The case made by the amended bill is founded on the certificate of the Western Star Order, which is the promise of the order to pay the benefits accruing thereunder on the death of Wolf G-reenbaum in accordance with and to the parties named in the statute and designated and provided for by the laws of the order, and an assignment thereof to appellant. The bill does not show that appellant is a beneficiary named or provided for by the laws of the order, or that it is such a society as the statute authorized payment of benefits to under a benefit certificate. The appellee order has waived no right by bringing the money into court, and acknowledging its liability to pay it to appellant or to Bertha Greenbaum, as would have been the case had it filed a bill of interpleader and brought the money into court, asking the court to determine which of the claimants is entitled to the fund. The appellee order is here standing upon its contract, ready to execute it by paying the money as it agreed to pay it, but objecting to paying the fund to any person or corporation other than the beneficiaries authorized by the statute under which it is organized, and the laws of the order. A different question is therefore presented by the bill from that decided in Binkley v. Jarvis, 102 Ill. App. 59. That case as stated by the court was in effect a bill of interpleader, and the court said: “The company only has the right to complain that this agreement (assignment) is void under its charter. But it is entirely content and makes no objection on that ground. Johnson v. Van Epps, 110 Ill. 561-563.”

The question presented by the demurrer to the bill is, will a court of equity under the facts shown in the bill enjoin appellee, Western Star Order, from paying the benefits to appellee G-reenbaum, and decree that such benefits be paid to appellant as assignee thereof for value?

“While a certificate such as the one here in question is not assignable in law, still all beneficial interests therein may be transferred in equity, and such equitable rights may be enforced in equity." Ptacek v. Pisa, 231 Ill. 522. Except as the statute inodifies this right of assignment, it .will be enforced in equity.

It is urged in behalf of appellant that the acceptance of dues and assessments from appellant, with knowledge of the assignment, operated as a waiver of the by-laws of the society providing that assignments shall be made only to blood relations, and as an estoppel of the society itself, since these by-laws were for the benefit only of the insured and may be waived by the society.

In National Home Building Assn. v. Bank, 181 Ill. 35-46, it is held: ‘‘The cases in this court where the corporation has been held to be estopped have been where the act complained of was within the general scope of the corporate powers.” And in the same case it is held that: “A party dealing with a corporation of limited and delegated powers conferred by law is chargeable with notice of them and their limitations,' and cannot plead ignorance in avoidance of the defense.”

Beneficiary societies organized under the laws of this state are corporations of limited powers, and their benefits are restricted to certain classes of persons named and fixed by statute. A benevolent association of the character of appellant cannot take as a beneficiary, as it is not within the classes specified in the statute. Old Peoples Home Society v. Wilson, 176 Ill. 94." In our opinion, under the authorities, the appellee, Western Star Order, did not waive its by-laws by accepting dues and assessments as averred in the amended bill, and it cannot be estopped from asserting and insisting upon its entire want of power under the law of its organization to agree to pay or to pay its beneficiary funds to appellant. What it cannot agree to do, directly or indirectly, it will not be compelled to do in equity, at the instance of an equitable assignee with full notice and knowledge of its charter powers.

The certificates in the possession of appellant on their face state that the benefits therein provided for should be paid to the beneficiaries only named in and provided for in the laws of the order. Appellant therefore was put on inquiry and thereby notified that it was not, and could not become, a beneficiary of the funds of the order under the laws and charter of the order, for the statute and the laws of the order were a part of the contract between the order and the G-reenbaums.

As said in Alexander v. Parker, 144 Ill. 355, 363, and quoted in Old Peoples’ Home Society v. Wilson, supra:

“Where the statute under which a benevolent corporation is organized, and its charter adopted in pursuance of such statute, designate certain classes of persons as those for whom a benefit fund is to be accumulated, a person not belonging to either or any of such classes is not entitled to take the fund. The corporation has no authority to create a fund for other persons than the classes specified in the law, nor can a member direct the fund to be paid to a person outside such classes.”

A court of equity will not, in our opinion, by its decree compel a fraternal beneficiary society organized under the existing statute of this state, to pay over a beneficiary fund, contrary to the provisions of its charter and laws, at the instance of an assignee outside of the classes named in the statute.

It is urged against this view of the case, that if the money is paid to appellant it is really paid to Mrs. G-reenbaum, the beneficiary named in the certificate and the charter and laws of the. order. We do not think this contention is tenable. It is based on the equities between appellant and Mrs. Greenbaum solely, and leaves out of consideration the fact that appellee, Western Star Order, has done nothing by which it has waived its rights to stand upon its charter rights and insist upon the strict terms of its contract. The relation of appellant to the order is not materially different from what it would have been if the old certificates had been surrendered and new certificates issued payable to appellant. The certificates were issued under section 258, chapter 73 of the Revised Statutes, which specifies the persons to whom benefits may be paid and limits such payments to the persons named. .

The decree is affirmed.

Affirmed.


author: Mr. Presiding Justice Willis

text:
    Thomas Tully, Appellee, v. Western Union Telegraph Company, Appellant.
    Gen. No. 4,929.
    1. Torts—when action for delay in delivery of telegram will not he sustained. Delay in the delivery of a telegram which requests that a common carrier delay the departure of its boat until the arrival of the sender of such telegram, will not confer a cause of action, in the absence of proof that the carrier had previously agreed to comply with such request.
    2. Torts—when action for delay in delivery of telegram will not he sustained. Held that the evidence in this case did not sustain a cause of action for the delay of the company in failing to deliver a telegram as follows:
    “Joliet, October, 8, 1905.
    J. Burke,
    Graham & Morton Dock, Chicago.
    Train late, will be in Chicago ten a. m.; hold boat for a few minutes.
    Thomas Tully.”
    3. Evidence—how proof of marhet price may he made; how may not he made. Proof of the market price of a commodity at a particular time and place cannot be made by hearsay evidence, except that in the absence of witnesses having personal knowledge of such market price, market quotations or reports in newspapers of general circulation are competent.
    Action commenced before justice of the peace. Appeal from the Circuit Court of La Salle county; the Hon. Edsar Eldredse, Judge, presiding.
    Heard in this court at the October term, 1907.
    Reversed and remanded.
    Opinion filed March 11, 1908.

      West, Eckhabt & Taylob, for appellant.
    E. J. Kelly and Buttebs, Armstrong & 'Ferguson, for appellee.
   Mr. Presiding Justice Willis

delivered the opinion of the court.

Thomas Tully brought suit before a justice of the peace of LaSalle county against the Western Union Telegraph Company to recover for the loss of prospective profits claimed to have been sustained by failure to deliver a telegram, and obtained judgment. The company appealed to the Circuit Court of said county, and Tully there obtained a verdict for $197. A motion for a new trial was overruled, judgment was entered on the verdict, and the company prosecutes this further appeal.

In October, 1905, appellee was engaged in the fruit business at Ottawa, Illinois, and was accustomed to purchase his supply of fruit in Benton Harbor, Michigan, where he had a regular agent or commission man, named Gray. When he wished to buy small quantities of fruit he made his purchases through Gray, but when he wished" to purchase large quantities, he went to Benton Harbor. On Sunday morning, October 8, 1905, he left Ottawa for Chicago on the 6:10 train over the • Chicago, Bock Island & Pacific Bailroad, intending on his arrival in Chicago, to take passage on a boat of the Graham & Morton Dock Company, which was to leave for Benton Harbor at ten o ’clock a. m. on that day. The train upon which appellee was a passenger from Ottawa to Chicago was behind its schedule time and reached J oliet at ten minutes before nine. There appellee stepped from the train and delivered to appellant’s operator in the Bock Island depot, the following telegram, addressed to one Burke who controlled the departure of the boats of the Graham & Morton Dock Company, over whose line appellee shipped produce, and who was Chicago manager for said company:

“Joliet, October 8, 1905.

J. Bubke,

Graham & Morton Dock,

Chicago,

Train late, will be in Chicago ten a. m. ; hold boat for' a few minutes.

Thomas Tully.”

He paid the operator the sum of thirty-one cents for the transmission of the telegram, and told him to “rush” the message as he had a big fruit deal on in Benton Harbor and did not wish to miss the boat. Appellee arrived at the dock in Chicago at 10:10 a. m. and found that the boat had gone. The message was delivered at 10:30 a. m. Appellee testified that he intended to buy fruits of various kinds at Benton Harbor that night or the next morning, which in the ordinary course of shipment would reach Ottawa Tuesday morning following; that a number of retail merchants had told him that, if his fruit was nice and the price suited, they would take some peaches and other fruit; that he did not reach Benton Harbor until two o’clock Monday afternoon, and did not have in Ottawa, Tuesday morning, the fruit he expected to have.

Appellee also testified over objection, that he at one time had a conversation with Burke, in which he said that if appellee should ever desire to have the boat delayed, to notify him and he would hold it for ten or fifteen minutes. He further testified that he intended to purchase in Benton Harbor, Sunday afternoon, October 8, 1905, certain kinds and quantities of fruit, but that he purchased nothing on that day. He also testified as to the market price of the fruits on that day, and on cross-examination, that he learned the market prices from his agent.

At the close of appellee’s evidence in chief, appellant moved the court to instruct the jury to find the issues for the plaintiff and assess his damages at the sum of thirty-one cents and offered an instruction to that effect, which the court refused.

There is no evidence in this record that the Graham & Morton Dock Company had, through Burke, entered into a contract with appellee to hold the boat for him. No proof was offered that they would have held it, and had such proof been offered, it would have been incompetent. Allen v. Stout, 51 N. Y. 668; Smith v. W. U. Tel. Co., 83 Ky. 104; Weed v. Martin, 89 Ala. 587; Com. Bnk. v. Firemen’s Ins. Co., 87 Wis. 297; W. U. Tel. Co. v. Ferguson, 157 Ind. 64. The only proof of the price of fruit in Benton Harbor on Sunday, October 8, 1905, was appellee’s statement that Gray, his agent, had told him what the prices were that day This proof was but hearsay and clearly incompetent, and should have been excluded on appellant’s motion. Kost v. Bender, 25 Mich. 515; Carpenter v. First Nat. Bnk., 119 Ill. 352; Grubey v. National Bank of Illinois, 133 Ill. 79. In the absence of witnesses having personal knowledge of the market price, the market quotations or reports in newspapers of general circulation would have been a proper source of information and admissible to establish it. Sisson v. Cleveland & Toledo Railroad Company, 14 Mich. 497; Cleveland & Toledo Railroad Company v. Perkins, 17 Mich. 296. But private information conveyed in a conversation from Gray to appellee was not admissible. There is no proof in this record that there was on the market in Benton Harbor, at the time appellee expected to arrive there and make his purchases, any fruit such as he contemplated purchasing, nor that he could have obtained such fruit at prices satisfactory to him, nor was there proof that the fruit which was on sale that day in Benton Harbor would have been satisfactory to any of his customers in Ottawa, or that the prices which he would have charged would have been satisfactory to them. There is no competent evidence tending to show that he had contracts for the sale of fruit on Tuesday, nor is there any proof that he lost any sales by the failure to deliver the telegram. It appears from the proof that he was in Benton Harbor a few hours later than he would have arrived there by the boat, but there is no proof in this record whether or not he purchased the fruit he intended to buy, or. if he purchased any, that it was not of as good quality and at as good prices as he could have bought the day before. There is no proof that he did not supply his customers twenty-four hours later with as much fruit and as good' fruit and for as good prices as he would have supplied them if the boat had been held. There is no proof that he sustained any damages, except what he paid for the telegram, and therefore there is’no occasion for us to consider the many authorities cited by counsel. There is no proof in this record to support more than a recovery for nominal damages, and the court should have given the instruction asked to find the issues for the plaintiff and to assess his damages at thirty-one cents and should have entered judgment therefor.

The judgment of the trial court is reversed and the cause remanded.

Reversed and remanded.