text:
    W. A. Case and Son Manufacturing Company, Appellee, v. C. Erwin Norman, trading as C. Erwin Norman and Company, and Mrs. William Patterson, Appellants.
    Gen. No. 23,628.
    1. Corporations, § 51* — when de facto corporate existence is shown prima facie. On a plea of nul tiel corporation, interposed by defendant in an action on a note, evidence held sufficient prima facie to show the de facto corporate existence of the plaintiff.
    2. Corporations, § 59* — what estops person to claim corporation has not de facto existence. Correspondence by a party dealing with a corporation in its corporate name, held to estop him from disputing liability on the ground that the corporation did not have a de facto existence.

      Appeal from the County Court of Cook county; the Hon. J. J. Cooke, Judge, presiding. Heard in the Branch Appellate Court at the October term, 1917.
    Affirmed.
    Opinion filed May 15, 1918.
    Cleland, Lee & Phelps, for appellants; Lester E. Lee, of counsel.
    Hoyne, O’Connor & Irwin, for appellee.
   Mr. Presiding Justice Taylor

delivered the opinion of the court.

Appellee brought suit upon a promissory note, which was made by Mrs. William Patterson, payable to and indorsed by C. Erwin Norman and Company, appellant, and delivered by the latter to appellee, and recovered judgment thereon against C. Erwin Norman and Company, upon a directed verdict in the sum of $1,000 and costs.

The appellant, having purchased certain merchandise from the appellee, indorsed and delivered, therefor, to the appellee the following promissory note:

“$961.00. Chicago, Ill. August 13, 1915. Pour (4) months after date I promise to pay to the order of C. Erwin Norman and Co., Nine Hundred, Sixty-one dollars, at 18 W. Kinzie St. Value received with interest at-per cent per annum. Due 12/13/15.
(Signed) Mrs. William Patterson.”

The note was indorsed by appellant as follows: “C. Erwin Norman and Co. by C. Erwin Norman.” On December 13, 1915, the note was presented, to the maker and payment demanded and refused and notice of protest duly sent to appellant. Suit was then brought on the note by the appellee, and the appellant pleaded nul tiel corporation. At the trial, evidence was introduced to the effect that the W. A. Case and Son Manufacturing Company was located at Buffalo, New York; that it had transacted business since January 1, 1914; that it had a set of officers; that it had a minute book in which minutes of corporate meetings were entered; that it had adopted by-laws; that stockholders ’ meetings were held; that directors’ meetings were held; that corporate officers were elected; that certificates of stock were issued; that for three years prior to the date of the note and subsequent thereto, the appellant did business with the app.ellee, using the corporate name of the latter; that appellant wrote a number of letters addressed to appellee in its corporate name, such as “Messrs. W. A. Case and Son Mfg. Co.,” “Mr. J. P. Fell, Vice Pres, and Treas. W. A. Case and Son Mfg. Co.,” “Mr. J. Eobert Sutter, care of W. A. Case and Son Mfg. Co.”; that in a letter of November 29, 1915, addressed by appellant to W. A. Case and Son Manufacturing Company, the former stated, referring to the note involved herein, “The Patterson note is perfectly good and will be paid,” etc.

At the close of appellee’s evidence — the defendant resting — the trial judge, upon motion of the appellee, directed a verdict upon the note in favor of the appellee and entered judgment thereon. This appeal is taken therefrom.

Counsel for appellant announce in their brief, “but one ground for reversal and that is that plaintiff failed, at any time, to prove the de facto corporate existence” of appellee, W. A. Case and Son Manufacturing Company. Having filed a plea of nul tiel corporation, appellant contends that the burden of proof was then upon the appellee, to prove affirmatively its corporate existence, and that to do so it should have proven the statute of the State in which it was organized — which, in this instance, was New York — and its incorporation under that law. Considering the evidence that was offered and which was uncontradicted, we are of the opinion that the trial judge was fully justified, under the circumstances, in presuming that all the formal requirements of incorporation had been complied with and that it was not necessary for the appellee in making out a prima facie case to offer further evidence. Concord Apartment House Co. v. Alaska Refrigerator Co., 78 Ill. App. 683; Hudson v. Green Hill Seminary Corporation, 113 Ill. 618; Walker Paint Co. v. Ruggles, 48 Ill. App, 408; Holt v. Tennent-Stribling Shoe Co., 69 Ill. App. 332; Spreyne v. Garfield Lodge No. 1, 117 Ill. App. 254; West Side Auction House Co. v. Connecticut Mut. Life Ins. Co., 186 Ill. 156. It, however, is unnecessary to place this decision on the sole ground of proof of the existence of the appellee as a de facto corporation. A reasonable interpretation of the correspondence between appellee and appellant justifies the conclusion that the latter has obviously estopped himself from disputing liability to appellee in its corporate name. Spreyne v. Garfield Lodge No. 1,117 Ill. App. 253; Lombard v. Chicago Sinai Congregation, 64 Ill. 477.

We are of the opinion (1) that the evidence offered as to the existence of the appellee as a corporation, (2) the evidence contained in the many letters written by appellant to appellee, in its corporate name, and (3) the fact that appellant delivered the note to the appellee as a payment for merchandise, constituted, all taken together, ample evidence justifying the judgment of the trial court.

Finding no error in the record the judgment is affirmed.

Affirmed.


source: Caselaw Access Project

author: Mr. Presiding Justice Taylor

license: Public Domain

text:
    Norman Carroll, Appellee, v. A. Goldstein, Appellant.
    Gen. No. 23,643.
    (Not to be reported in full.)
    Abstract of the Decision.
    1. Brokers, § 105

       — when property owner is hound to purchase property of another through latter's agent. Where a property owner states to a real estate agent that he will purchase certain property at a specified price which is held for sale by the latter if the latter will procure the sale of the former’s property, there is an offer in the nature of a continuing offer on such property owner’s part, and, if the offer is not previously withdrawn, the moment the agent furnishes the consideration by rendering services resulting in the sale of the owner’s property, there comes into existence a unilateral contract, executed on the agent’s part and binding the owner to purchase the property held by the agent.
    2. Frauds, Statute of, § 130* — when defense of may not first he raised. Where the Statute of Frauds is not mentioned as a defense in the affidavit of merits below, it cannot be considered in the Appellate Court.
    Appeal from the County Court of Cook county;, the Hon. David T. Smiley, Judge, presiding. Heard in the Branch Appellate Court at the October term, 1917.
    Affirmed.
    Opinion filed May 15, 1918.
    Statement of the Case.
    Action by Norman Carroll, plaintiff, against A. Goldstein, defendant, to recover damages for a breach of a contract to purchase certain real estate. From a judgment for plaintiff for $437.50, defendant appeals.
    Bernard J. Brown, for appellant.
    Montgomery, Hart & Smith, for appellee.

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

   Mr. Presiding Justice Taylor

delivered the opinion of the court.


text:
    John F. Kernan, Jr., Appellee, v. Advance Terra Cotta Company, Appellant.
    Gen. No. 23,667.
    (Not to be reported in full.)
    Abstract of the Decision.
    1. Master and servant, § 14

       — when oral contract of employment for one year shown. An oral contract of employment for a year is sufficiently established by evidence of the employee that the employer’s president stated to the employee that the company would pay him a certain amount a week for one year and the employer’s president testified to the same effect and there is no material evidence to the contrary.
    2. Master and servant, § 50* — when incompetency of servant and discharge for cause not shown. In an action to recover for a breach of a contract of employment, evidence held sufficient to support a finding for plaintiff on the issue that he was incompetent and was discharged for cause.
    3. Master and servant, § 50* — when diligence in procuring other employment shown. In an action to recover for a breach of a contract of employment, where plaintiff testifies as to his diligence in securing other employment and his evidence is not denied and no affirmative evidence is offered for defendant in regard thereto, a finding for plaintiff is warranted.

      Appeal from the Municipal Court of Chicago; the Hon. Sheridan E. Ery, Judge, presiding. Heard in the Branch Appellate Court at the October term, 1917.
    Affirmed.
    Opinion filed May 15, 1918.
    Statement of the Case.
    Action by John F. Keman, Jr., plaintiff, against Advance Terra Cotta Company, a corporation, defendant, to recover for a breach of a contract of employment. From a judgment for plaintiff for $200, defendant appeals.
    Buell & Abbey, for appellant.
    James M. Slattery, for appellee.

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

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

   Mr. Presiding Justice Taylor

delivered the opinion of the court.

4. Trial, § 265 — when verdict not disturbed as result of compromise. In an action to recover for a breach of contract of employment, where plaintiff’s evidence as to the time he was out of work and the pay which he received when he secured other employment is not contradicted, a verdict for plaintiff will not be disturbed on the ground that it must have been the result of a compromise, merely because there is a disparity between the amount of the verdict and the amount claimed by plaintiff.


text:
    Frank H. Morgan, Appellee, v. Arthur G. Vierling, Appellant.
    Gen. No. 23,679.
    (Not to he reported in full.)
    Appeal from the Municipal Court of Chicago; the Hon. Wells M. Cook, Judge, presiding. Heard in the Branch Appellate Court at the October term, 1917.
    Reversed and remanded.
    Opinion filed May 15, 1918.
    Statement of the Case.
    Action by Frank H. Morgan, plaintiff,. against Arthur G-. Yierling, defendant, to recover for the rental of an apartment. There was a judgment by confession for plaintiff for $42.50 and for $20 attorney’s fees, and from a judgment overruling defendant’s motion to vacate the judgment, he appeals.
    Robert F. Kolb, for appellant; Frank Ingraffia, of counsel.
    Adame, Crews, Bobb & Wescott, for appellee.

      Abstract of the Decision.
    1. Landlord and tenant, § 264

       — what constitutes constructive eviction. Failure on the landlord’s part to provide heat as required by the terms of the lease may constitute a constructive eviction.
    2. Landlord and tenant — when affidavit of defense in action for rent is sufficient. An affidavit of defense in an action for rent setting up a constructive eviction by failure to furnish heat is sufficient where it recites the temperature and time of such failure, and it is obvious that if the recitals are true the heat furnished was not sufficient for the use of the premises for the purposes for which they were rented, and it is not necessary that the affidavit negative the provision contained in the lease by which the lessee waives all right to claim an eviction in case the landlord is unavoidably delayed from furnishing heat.
    3. Landlord and tenant, § 319* — when burden of proving unavoidable delay in furnishing heat is on landlord. In an action for rent, where defendant sets up a constructive eviction by plaintiff’s failure to furnish heat, it is not necessary that he show that plaintiff was not unavoidably delayed in furnishing heat, but the burden of proving such delay is on the landlord, even though the lease provides that the lessee waives the right to claim an eviction in case the landlord is unavoidably delayed in furnishing heat.

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

   Mr. Presiding Justice Taylor

delivered tie opinion of the court.


text:
    Frank H. Morgan, Appellee, v. Arthur G. Vierling, Appellant.
    Gen. No. 23,785.
    (Not to he reported in full.)
    Appeal from the Municipal Court of Chicago; the Hon. Wells M. Cook, Judge, presiding. Heard in the Branch Appellate Court at the October term, 1917.
    Reversed and remanded.
    Opinion filed May 15, 1918.
    Statement of the Case.
    This case involves the same facts and principles as are contained in Morgan v. Vierling, ante, p. 317, and the decision therein controls.
    Robert F. Kolb, for appellant; Frank Ingraffia, of counsel.
    Adams, Crews, Bobb & Wescott, for appellee.
   Mr. Presiding Justice Taylor

delivered the opinion of the court.


author: Mr. Presiding Justice Tatlor

text:
    George E. Krueger, Appellee, v. L. H. lundeen and Owen Johnson, Appellants.
    Gen. No. 23,694.
    1. Tbade-marks and trade names, § 21

       — how former servants may not interfere uÁth business of master. While employees who leave an employer may engage in a similar business in the same neighborhood and may make every legitimate effort to promote its success, they cannot make representations concerning and give out information as to his business for the purpose of seducing his former customers from returning to him and in order to obtain his former customers and to profit thereby.
    2. Injunction, § 51a* — when justified because of unfair competition. On a bill to enjoin unfair competition, it is not the defendant’s motive that is important, but it is his conduct in unfairly depriving complainant of that which belongs to him that is condemned and gives the court jurisdiction and justifies an injunction.
    3. Tbade-marks and trade names, § 26* — what does not constitute variance between bill and proof. There is no variance between a bill of complaint which alleges that defendants had circulated certain reports as to the removal of complainant’s office and had represented to certain of the latter’s patients who had contracted with him for treatment that it would be given at defendants’ office and evidence of such patients that one of the defendants had made representations to influence them to visit defendants and have future work done by them.
    4. Trade-marks and trade names, § 26* — when decree enjoining unfair competition sustained by evidence. On a bill to enjoin unfair competition, evidence held to sustain a decree for complainant.
    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, 1917. Certiorari denied by Supreme Court (making opinion final).
    Affirmed.
    Opinion filed May 15, 1918.
    Rehearing denied May 28, 1918.
    George A. B. Pfuhl and James Considine, for appellants ; Douglas C. Gregg, of counsel.
    Frederick A. Bangs and Richard H. Colby, for appellee.

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

   Mr. Presiding Justice Tatlor

delivered the opinion of the court.

The sole question in this cause is whether a decree permanently restraining the appellants (1) from representing that a dental office operated by the appellee at 802 West Madison street was moved to 740 West Madison street; (2) from circulating the report, or stating to patients of appellee, whose dental work was in process of completion, that their work would be completed at 740 West Madison street; and (3) from making any other representations intending to lead the public to believe that the dental office conducted by appellants at 740 West Madison street had any connection with the dental office at 802 West Madison street, is erroneous.

Krueger, appellee, a licensed dentist, having purchased a dental establishment at 802 West Madison street, known as “McConnell, Dentists,” from one Dr. Whitman, employed Lundeen, one of the appellants, to take charge of and manage it. Subsequently, appellee also employed Johnson, one of the appellants, to work for him at the same place. On September 17, 1916, appellant Lundeen, -who had worked for appellee for over three years, left the employment of the appellee and opened up an office at 740 West Madison street, being just across the street from 802 West Madison street, where appellants had formerly worked for appellee. A number of witnesses were called by appellee to prove that appellants were guilty of unfair conduct in obtaining patients who had formerly visited the dental establishment of appellee.

The evidence of the witnesses Smith, Olsen, Murrell, Brown, McEneany, Shanks and Aramian, which is referred to and commented upon in the master’s report, sufficiently proves that appellant Lundeen made representations to influence them, as former patients of appellee, to visit appellants and have their future dental work done by appellants. It is needless here to set forth a resumé of the evidence on that subject. We are of the opinion that there was ample evidence justifying the decree. There is no doubt but that appellants, when they left the employment of appellee, had the right to go across the street and open up a new office for the practice of dentistry. They were entitled to make every legitimate effort to further their own welfare and increase their professional success and profit. Of course, in such a case as this, it is not the motive of the appellants that is important, as “a, wrongful motive cannot convert a legal act into an illegal one.” Nuns on Unfair Competition, etc., p. 333. It is conduct which unfairly deprives another of that which belongs to him that is condemned and which gives the court jurisdiction and justifies the injunction. (The law does not allow ex-employees to make representations concerning and give out information about their former employer’s business for the double purpose, first, of seducing patients from going back to the place of business of their former employer, and, second, of obtaining their former employer’s customers and pecuniarily profiting thereby.

It is contended by the appellants that the evidence is not consistent with the allegations in the bill of complaint, and that there is a variance. The allegations in the bill of complaint, that appellants had circulated certain reports as to the removal of the dental offices and had made certain representations to patients of the appellee who had contracted for dental work that the rest of the work would be done at the new office, are not only consistent with the evidence, but, when proven, amply support as well as justify the decree.

Finding no error in the record the decree is affirmed.

Affirmed.


text:
    Nannie E. Miles, Appellee, v. International Hotel Company, Appellant.
    Gen. No. 23,758.
    (Not to be reported in full.)
    Abstract of the Decision.
    1. Innkeepers, § 6

       — what care in selection of employees and in caring for baggage shown. In an action against a hotel company to recover for the loss of baggage stored with it, evidence held to show that defendant used normal business care and judgment in the selection and employment of the employees having charge of the baggage room, and that it exercised ordinary care in caring for the baggage.
    Appeal from the Superior Court of Cook county; the Hon. Clinton F. Irwin, Judge, presiding. Heard in the Branch Appellate Court at the October term, 1917.
    Reversed.
    Opinion filed May 15, 1918.
    Rehearing denied May 28, 1918.
    Statement of the Case.
    Action by Nannie E. Miles; plaintiff, against International Hotel Company, defendant, to recover the value of a trunk and its contents, alleged to have been accepted for storage by defendant and to have been lost by it. From a judgment for plaintiff for $1,097, defendant appeals. The facts involved are practically the same as those involved in Miles v. International Hotel Co., 167 Ill. App. 440.
    A. G. Digus, for appellant.
    Thomas D. Nash and Michael J. Ahern, for appellee.

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

   Mr. Presiding Justice Taylor

delivered the opinion of the court.

2. Innkeepers, § 6* — when not required to use more than ordinary care as to baggage. In an action against a hotel company to recover for the loss of baggage stored, with it, a notice by defendant that baggage left with it will receive its “best attention * * * but in case of * * * damage of any kind, it will be at the risk of the owner,” held not to demand of defendant either more or less than ordinary care.

3. Innkeepers, § 6* — when burden not on defendant in action for damages for loss of baggage. In an action against a hotel company to recover for the loss of baggage stored with it, the burden is not on defendant to show the precise circumstances surrounding the actual loss of the trunk.

4. Innkeepers, § 6* — when verdict for plaintiff for loss of baggage not sustained. In an action against a hotel company to recover for the loss of a trunk stored with it, where defendant shows its general practice in handling and keeping baggage and such practice is unobjectionable and shows that the employees ’ who would, normally, take charge of the trunk were of good character and fit for their positions, and the only evidence to the contrary is the presumption arising from the loss of the trunk, a verdict for plaintiff cannot be sustained.

O’Connor, J., dissenting.


author: Mr. Justice O’Connor

text:
    James H. Knight, Administrator, Defendant in Error, v. Edgar F. Seney and Rowland T. Rogers, trading as Seney, Rogers & Company, Plaintiffs in Error.
    Gen. lío. 23,433.
    1. Pledges, § 44

       — when action for conversion lies against pledgor. When pledged property is delivered to the pledgor for a special or limited purpose to be returned later, or the proceeds thereof, to the pledgee, the latter will not lose his lien, and if the pledgor fails, neglects or refuses to return the property or the proceeds, an action will lie against him for conversion.
    2. Pledges, § 44* — when shown that securities or proceeds toere

      to be returned in specified time. In an action in trover against a pledgor for conversion of securities, evidence held sufficient to sustain a finding that such securities or the proceeds thereof were to be returned in a specified time.
    3. Appeal and error, § 438

       — when question of variance may not be availed of. Where appellant’s brief contains no argument that a variance between the pleadings and proof which could have been obviated then was pointed out on the trial, the variance cannot be availed of on appeal.
    4. Municipal Court of Chicago, § 13a* — what does not constitute variance in action for conversion of securities. In an action in trover for the conversion of securities, an averment in the statement of claim that plaintiff did not authorize the sale of the securities is not materially variant from his testimony that he did authorize a sale of securities to be made at a specified place under the circumstances mentioned.
    5. Pledges, § 46* — what should be verdict in action for conversion of pledged securities. Where trover is brought to recover for the conversion of securities which are collateral to a loan, the verdict should be the value of the securities at the time of the conversion with interest thereon, provided the indebtedness for which the collateral is held equals or exceeds such value, but if the amount of the indebtedness is less than the value of the securities converted, then no recovery can be had in excess of the indebtedness, although the securities were worth more.
    6. Usury, § 5* — what constitutes. A contract for the investment of money and for the payment of 10 per cent, interest in consideration thereof, held to be a contract for a loan and usurious and that no interest was recoverable thereon.
    7. Usury, § 32*- — when may be set up to defeat collection of balance. It is not the law that no credit can be given for the payment of usury where it is voluntarily made, but the true rule is that as long as any portion of the debt remains unpaid, usury may be set up by the debtor by way of defeating the collection of this balance.
    8. Usury, § 5* — what may not be set up as. Commissions paid a son of one party to a contract by the other party on the business of such parent cannot be set up as usury in an action under the contract.
    9. Pledges, § 44* — when shown that collateral was applicable to all transactions between parties. In an action of trover for the conversion of securities, evidence held sufficient to support a finding that certain collateral was applicable to all of the transactions between the parties.

      10. Pledges, § 8

       — how determined what debts are secured by collateral. In determining what debts are secured by collateral, the whole transaction between the parties is to be looked to, their intention controlling.
    11. Appeal and ebbob, § 1658* — when error in entering judgment for too large a stum, cured. Error in entering a judgment for too large a sum may be cure.d on appeal, where the amount properly due is not disputed and is ascertainable, and judgment for the proper amount affirmed.
    Taylor, P. J., dissenting.
    Error to the Municipal Court of Chicago; the Hon. Hosea W. Wells, Judge, presiding. Heard in the Branch Appellate Court at the October term, 1917.
    Modified and affirmed.
    Opinion filed May 15, 1918.
    Adams, Crews, Bobb & Wescott, for plaintiffs in error.
    Winston, Payne, Strawn & Shaw, for defendant in error.

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

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

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

   Mr. Justice O’Connor

delivered the opinion of the court.

James H. Knight, as administrator of the estate of Adele Knight, deceased, brought an action in trover against Edgar F. Seney and Rowland T. Rogers, doing business as Seney, Rogers & Company. The case was tried before the court and jury, and there was a verdict in favor of plaintiff for $58,800. The defendants made a motion for a new trial, which was not disposed of for some time. The court overruled the motion and entered judgment for $62,319.76, being the amount of the verdict with interest thereon to the date of the judgment, and defendants prosecute this writ of error.

The record discloses that on August 10, 1911, Adele Knight, deceased, entered into a¿ written contract with the defendants, which recited that the defendants were engaged in the banking and brokerage business, and in the business of loaning moneys, buying and selling mortgages, and other securities, upon commissions and otherwise; and provided that Mrs. Knight would for a period of 5 years, unless the agreement was sooner terminated, invest $30,000 in the purchase of mortgages, trust deeds or bonds, the price not to exceed the par value thereof, and the same to be approved by her representatives; that the defendants in each case were to deliver to her the original notes or bonds, together with a title guarantee policy, or a merchantable abstract of title, policy of fire insurance and other information; that defendants might substitute other mortgages or bonds in lieu of those delivered, provided the same were satisfactory to Mrs. Knight; that the defendants might in such case resell the securities, and upon each resale Mrs. Knight was to deliver up the securities, together with other papers pertaining thereto. There was a further provision that the defendants should pay to Mrs. Knight the sum of $3,000 per year in quarterly instalments, in advance, and in consideration of such payment Mrs. Knight agreed to turn over and deliver to the defendants all interest notes or coupons of the securities in her possession, or the money in case she had collected any, and this was to be a complete payment and satisfaction of Mrs. Knight’s part in the profits arising from the investment and services rendered in examining the securities. There was a further provision that upon the termination of the agreement by lapse of time, or otherwise, the defendants should pay to Mrs. Knight the $30,000 invested by her, together with any quarterly instalments or portion thereof that might then be due, and upon such payment Mrs. Knight should turn over and deliver to the defendants all securities held by her, and upon the termination of the contract, in case the defendants failed, neglected or refused to return or repay the $30,000, together with the quarterly instalments then due, Mrs. Knight, upon giving 10 days’ notice, might sell the securities she held at public auction to the highest and best bidder for cash, and might become the purchaser at such sale and apply the amount towards the repayment of the purchase price, after deducting reasonable costs and expenses, including reasonable attorney’s fees, and in case the proceeds from such sale were insufficient to pay the expenses and the $30,000 or any portion that might remain due, the defendants agreed to pay such deficiency at once. If there was a surplus it should be paid to the defendants. The contract by its terms might be terminated by Mrs. Knight upon giving the defendants 6 months ’ notice in writing, and was made binding upon the executors and administrators of both parties. On'December 9,1911, the same parties entered into five similar contracts aggregating $40,000, and as in the first contract the annual payment to be made Mrs. Knight was 10 per cent, of the amount.

In accordance with the terms of the several contracts bonds and other securities were delivered to Mrs. Knight.. On January 22, 1912, Mrs. Knight died intestate and her son, James H. Knight, was appointed administrator of her estate. On March 1,1912, he gave his check as administrator to the defendants for $15,000, and on May 15th following a similar check for $5,000. July 9, 1912, plaintiff turned over to defendants at their request securities aggregating $10,000 and took their receipt therefor, which is as follows:

Received in Trust from Jas. H. Knight, Bailor, Victoria Bonds ■ $2600.00
Peoples Hospital Bonds $7400.00
and hereby undertake to hold said property of the said Jas. H. Knight and subject to his order, for the purpose of being sold or otherwise dealt "with, as the said bailor may direct; and when sold to pay net proceeds to the said bailor. We hereby acknowledge ourselves to be the bailees of said property for said bailor. If for any reason whatever a sale of said property is not completed before 3 days, we agree to return same to said bailor.
Seney, Rogers & Co.
By R. T. Rogers.”

Three days later, July 12th, under similar circumstances, plaintiff turned over to defendants securities aggregating $30,000 and on February 7, 1913, under like circumstances, other securities aggregating $10,000, all of which had been held by Mrs. Knight under her contracts with the defendants, and on each occasion the defendants gave plaintiff a similar receipt. Some time after the period mentioned in the three receipts had elapsed, plaintiff demanded the return of the securities or the proceeds thereof, and the defendants having failed to return either, this suit was brought.

Plaintiff testified that at and before the several times he delivered to defendants the securities covered by the three receipts, defendants stated that they were negotiating a deal involving more than $300,000 in Toledo, Ohio, and that to enable the defendants to consummate the matter, it was necessary for them to produce collateral, and for this purpose they requested plaintiff to deliver to them the securities mentioned; that on numerous occasions plaintiff demanded the return of the securities or the proceeds, and that the defendants on several of these occasions told him that the deal was still pending, and on others that the securities had been sold and a check had been received for them and that plaintiff would be paid as soon as the check had passed through the bank.

The defendants offered evidence tending to show that plaintiff was told that the securities mentioned in the receipts of July 9th, and 12th were to be used in the completion of the Victoria Theater building which the defendants were financing and that the securities were sold and the money used for this purpose, and that the securities mentioned in the receipt of February 7th were exchanged for other securities in accordance with the contracts. Plaintiff denied that there was any such understanding or that there had been such an exchange of securities, and there was other evidence that tended to show that the proceeds of the securities were used to pay the general expenses of the defendants in the conduct of their business. The evidence was conflicting and, after a careful consideration, we think the jury were fully warranted in accepting plaintiff’s version of the matter.

The defendants contend that even if the securities were sold in direct violation of the agreement, and although the defendants fraudulently concealed that fact, yet there would be no such conversion of the securities as would warrant a verdict in trover, as plaintiff repeatedly testified that he knew the defendants were to sell the securities, and that in such case trover will not lie. With this contention we cannot concur. When pledged property is delivered, to the pledgor for a special or limited purpose to be returned later, or the proceeds thereof, to the pledgee, the latter will not lose his lien, and if the pledgor fails, neglects or refuses to return the property or the proceeds, an action will lie against him for conversion. Hollister v. Dinsmore, 191 Ill. App. 377; Colburn v. Commercial Security Co., 172 Ill. App. 510; Cooper v. Ray, 47 Ill. 53; Rice & Bullen Malting Co. v. International Bank, 185 Ill. 422; Kellogg v. Tompson, 142 Mass. 76; Way v. Davidson, 12 Gray (Mass.) 465; Hays v. Riddle, 1 Sandf. (N. Y.) 248.

We think there was ample evidence to sustain the verdict that the securities, or the proceeds thereof, were to be returned within a specified time. In this connection it may be pertinent to note that if the defendants’ version is true, viz., that the securities mentioned in two of the receipts were to be sold and the proceeds used towards the completion of the Victoria Theater building, and the securities in the other receipt were exchanged for others, it is strange that they should execute the receipts in the form they did, for it is expressly stated in each that the defendants are to hold the property subject to plaintiff’s order, for the purpose of being sold or otherwise dealt with, as the plaintiff, bailor, may direct, and when sold to pay the proceeds to him, and if for any reason the securities were not sold within 3 days they were to be returned to him.

Defendants also contend that there is a fatal variance between the allegations of the statement of claim and the proof; that it is averred in the statement of claim that plaintiff never directed any sale of the securities, while his own testimony shows that he did do so. We have examined defendants’ brief and find no argument that this variance was pointed out on the trial. If this had been done the variance could have been obviated, and it is elementary that such point cannot be made in these circumstances. But in any event we think that the variance is not material. It is averred in the statement of claim that plaintiff did not authorize the sale and he testified that he did authorize it to be made in Toledo under the circumstances mentioned ; and while it would have been more accurate for plaintiff to have averred that he did not authorize the sale of the securities as made, yet we think the variance is not substantial.

The defendants further contend that the verdict is excessive, for the reason that it is more than the amount owed by the defendants to Mrs. Knight’s estate. It is true that where an action of trover is brought to recover for the conversion of securities which are collateral to a loan, the verdict should be the value of the securities at the time of conversion with interest thereon, provided the indebtedness for which the collateral is held equals or exceeds such value, but if the amount of the indebtedness is less than the value of the securities converted, then no recovery can be had in excess of the indebtedness, although the securities were worth more. Hollister v. Dinsmore, supra. It is also argued on this point that the contracts between the defendants and Mrs. Knight were tainted with usury, and therefore no interest should be allowed on the loans made; that the contracts between the parties clearly showed that the transactions were simply loans made by Mrs. Knight and were worded in an endeavor to evade the statute against usury. From an examination of the written contract, we think it clear that the amounts advanced by Mrs. Knight to the defendants were loans, and as the contract provided for the payment of 10 per cent, it was usurious, and therefore no interest is recoverable. Section 6, ch. 74, Eev. St. (J. & A. 6695). Plaintiff, however, argues that the moneys advanced by Mrs. Knight constitute separate transactions from the ones involved in the instant case; that the former are based on written contracts entered into between Mrs. Knight and the defendants, while the instant case is based on the three receipts given by the defendants to plaintiff. This argument is beside the point. The contracts between Mrs. Knight and the defendants become important only in determining the amount due from the defendants in excess of which plaintiff cannot recover. Plaintiff also argues that even if the contracts were usurious, no credit can be given for the payment of usury where it is voluntarily made as here. This is not the law. As long as any portion of the debt remains unpaid, usury may be set up by the debtor by way of defeating the collection of the balance. Mason v. Pierce, 142 Ill. 331; Meers v. Stevens, 106 Ill. 549. There is no dispute that the defendants paid to Mrs. Knight 10 per cent, on the moneys advanced, or $11,786.11, and defendants should be given credit for this amount. Defendants further argue that commissions of one per cent, paid to plaintiff in obtaining the Victoria Theater business and his mother’s business for the defendants are also usury and should be deducted. It appears from the evidence that plaintiff was employed by defendants and it was agreed that defendants would pay him one per cent, on any business that he might bring to them; that they paid him one per cent, commission on the Victoria Theater contract, which business he brought to them, and that he was also paid one per cent, on his mother’s business. There is no dispute as to the facts in this regard, but we think it obvious that the commissions paid to plaintiff can in no way be considered in the light of usury. The undisputed evidence is that on March 15, 1914, plaintiff rendered a statement of the account showing the amount which he claimed due from the defendants to him. From this it appears that $70,000 was loaned by Mrs. Knight in her lifetime and $20,000 by plaintiff as her administrator, making a total of $90,000. There appears a credit of $43,678.06, and as we held that no interest could be collected, the balance due as shown by the statement is $46,321.94. From this should be deducted the amount of the usury, $11,786.11, which leaves a balance of $34,535.83. The value of the securities involved in the instant case, as shown by the undisputed evidence, together with interest thereon from the several dates they were converted by the defendants, was $58,920.85. The verdict was for $58,800, but in no event could it exceed the amount of the indebtedness due from the defendants. Defendants, however, contend that the $15,000 loaned by plaintiff to the defendants March 1, 1912, cannot be considered as a part of the indebtedness due plaintiff as there was no agreement that the securities held by plaintiff should be collateral for this amount; that this was simply a loan without any collateral, and that the court so instructed the jury, but that the instruction was ignored. The court did so instruct the jury, but we think there was sufficient evidence to warrant the jury in finding that it was understood by the parties that the collateral held by the plaintiff should apply to this amount as well as to the other advances made to defendants. Plaintiff gave his check as administrator for this amount and took a receipt therefor, which does not state that the securities are to he held as collateral, but recites that the loan is to bear interest at 6 per cent, for 30 days, and after 30 days the amount might be withdrawn upon 5 days ’ notice to the defendants. May 15th following, plaintiff again gave his check as administrator for $5,000 and received a receipt which states it is “to apply on collateral arrangement, collateral for same to be delivered three days from date.” The evidence further shows that in the itemized statement which plaintiff submitted to defendants, March 15,1914, was included this $20,000 and no objection was made that this item was improperly included. Furthermore, as to the $15,000, the receipt given for this recites that interest is to be paid at 6 per cent, but one of the defendants testified that they had paid 10 per cent, which is the same rate that was paid under the original contracts with Mrs. Knight, and defendants sought credit for the usurious interest paid on this sum, thereby treating it as a part of the entire transaction. If it was separate and distinct, of course it should not have been brought into the case at all, but these two items of $15,000 and $5,000 were brought into the case by the defendants. Plaintiff in his statement to the defendants above mentioned also showed that he had sold certain securities under the original contract and gave credit on this $20,000 as well as on the $70,000. In determining what debts are secured by collateral the whole transaction between the parties is to be looked to — the intention of the parties is the thing to be ascertained. Jones on Collateral Securities (3rd Ed.), sec. 362; Story on Bailments, sec. 301. In view of all the circumstances, we think the jury were fully warranted in including the $20,000 in the indebtedness for which the securities were held as collateral. And although the court gave instructions to the jury that they should not include the item of $15,000, yet the defendants cannot complain of this action for they have suffered no legal wrong. McNulta v. Ensch, 134 Ill. 46; Chicago, R. I. & P. Ry. Co. v. Carey, 90 Ill. 514. And it must be presumed that this was the view of the trial judge from the fact that he overruled a motion for a new trial.

We have carefully considered the other points urged by the defendants, but find none of them of sufficient importance to constitute reversible error.

As the value of the securities converted was greater than the amount of the indebtedness due from the defendants, and the verdict was for the value of the securities, it is too large; but as the amount of the indebtedness is not in dispute, the error in entering judgment for too large a sum can be cured here. Plaintiff was entitled to a verdict for $34,535.83, as of March 20, 1916, the date when the jury returned their verdict, and to this sum should be added interest at the rate of 5 per cent, to the present, which is $3,717.40. This makes a total of $38,253.23. The judgment is accordingly modified and, under the authorities of sections 110, 111, Practice Act, J. & A. fifí 8647, 8648 (Pearsons v. Bailey, 2 Ill. 507; People v. Board Sup’rs Madison Co., 125 Ill. 9; Wilmans v. Bank of Illinois, 6 Ill. 667; Commercial Ins. Co. v. Scammon, 123 Ill. 601; Borg v. Chicago, R. I. & P. Ry. Co., 162 Ill. 348, and Dean & Son, Ltd. v. W. B. Conkey Co., 180 Ill. App. 162), judgment will be affirmed in favor of plaintiff and against defendants for $38,253.23.

Judgment modified and affirmed.

Mr. Presiding Justice Taylor dissenting:

Mr. Presiding Justice Taylor dissents, being of the opinion that the evidence shows an indebtedness but not a conversion.


text:
    T. Allen Beall, Appellee, v. Thomas L. Jones et al. A. M. Earel and A. M. Honeywell, Appellants.
    Gen. No. 23,614.
    (Not to he reported in full.)
    Abstract of the Decision.
    1. Account, § 49

       — when decree for accounting is inequitable. Decree on a bill for an accounting under a contract which allows complainant and denies defendants credit for amounts expended before the execution of the contract, held inequitable.
    2. Contracts, § 53* — when shown that signatures of additional persons to contract were necessary. On a bill for an accounting under a contract, evidence held not to support a finding that the contract was to become effective from its date but to show the intention of the parties to have been that it should not be binding until additional persons executed it and that it was not executed by such additional persons.

      Appeal from the Circuit Court of Cook county; the Hon. Thomas G. Wittoes, Judge, presiding. Heard in the Branch Appellate Court at the October term, 1917.
    Reversed and remanded with directions.
    Opinion filed May 15, 1918.
    Rehearing denied May 29, 1918.
    Statement of the Case.
    Bill for an accounting under a contract and for the removal of the trustee therein named by T. Allen Beall, complainant, against Thomas L. Jones, Alfred H. Trego, A. M. Earel and A. M. Honeywell, defendants. From a decree confirming a master’s report wherein complainant was given and defendants were denied credit for amounts expended prior to the execution of the contract, defendants Earel and Honeywell appeal.
    Dyer & Dyer, Dow & Cummings and J. B. Wall-bridge, for appellants.
    Charles Hudson, for appellee.

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

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

   Mr. Justice O’Connor

delivered the opinion of the court.

3. Contracts, § 53 — when contract not binding. Where a contract is not to become binding until executed by additional persons and such persons do not execute it, the contract does not become effective.

4. Costs, § 79* — when may be apportioned. On an appeal in a chancery proceeding the Apellate Court may apportion the costs.


text:
    Anton J. Cermak, Bailiff, for use of Robert Eckhardt, Appellee, v. Chicago Bonding & Surety Company, Appellant.
    Gen. No. 23,686.
    (Not to he reported in full.)
    Appeal from the Municipal Court of Chicago; the Hon. Nels A. Larson, Judge, presiding. Heard in the Branxfe Appellate Court at the October term, 1917.
    Affirmed.
    Opinion filed May 15, 1918.
    Statement of the Case.
    Action on a replevin bond by Anton J. Cermak, bailiff of the Municipal Court of Chicago, for the use of Robert Eckhardt, plaintiff, against Chicago Bonding & Surety Company, defendant. From a judgment for plaintiff for $95.91, defendant appeals.
    William McKinley, Luther F. Binkley and Albert Sabath, for appellant.
    No appearance for appellee.
   Mr. Justice O’Connor

delivered the opinion of the court.

Abstract of the Decision.

Replevin, § 152* — when judgment is sufficient. A judgment in a replevin suit complies with, section 22 of the Replevin Act (J. & A. f 9207) and is sufficient to support an action on the bond where it holds, in effect, that the property is held by the defendant in replevin for the payment of money, and orders that unless the amount for which it is so held be paid within twenty days, the property be returned. ,


text:
    Charles H. Lang, Appellee, v. Fred W. Blocki et al., Appellants.
    Gen. No. 23,720.
    1. Insurance, § 25

       — how capital stock may not be used. There is nothing in Hurd’s Rev. St. ch. 73, sec. 179 (J. & A. ji 6456) which warrants the conclusion that money subscribed for the capital stock of a life insurance company may be used by the corporators for the necessary expenses incurred in the formation of the company.
    2. Insurance, § 25* — what is duty of corporators of proposed company as to proceeds from subscriptions to stock. The corporators of a proposed life insurance company are trustees of the funds received from subscriptions to the stock and are required to conserve such funds and turn them over to the company when the organization is completed, and if this is not done but the funds are expended for other purposes, a subscriber who does not acquiesce in the expenditure may sue the corporators for money had and received.
    3. Corporations, § 25* — when corporators are liable to subscriber for amount of subscription. Where one subscribing for stock in a proposed corporation pays his subscription to the corporators and the corporation is never completed, he may recover against the corporators in an action for money had and received, even though the money was honestly spent in endeavoring to complete the organization and plaintiff sets up no claim of fraud, misrepresentation or deceit.

      Appeal from the Municipal Court of Chicago; the Hon. Hosea W. Wells, Judge, presiding. Heard in the Branch Appellate Court at the October term, 1917.
    Affirmed.
    Opinion filed May 15, 1918.
    Rehearing denied May 28, 1918.
    Adelor J. Petit and Charles F. McElroy, for appellants; Joseph J. Thompson, of counsel.
    John W. Creekmur and Donald J. De Wolfe, for appellee.

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

   Mr. Justice O’Connor

delivered the opinion of the court.

Charles H. Lang brought suit in the Municipal Court of Chicago against Fred W. Blocki, Sephas S. Driver, Julius C. Kirchner, Monroe Mundhenk, Maurice A. Barnett, Gilman W. Petit, David S. Bose, George W. Peck and Charles E. Gavin, to recover $1,000 and interest thereon. The defendants, Blocki, Driver, Kirchner, Mundhenk, Petit and Barnett, were served with process or filed their appearance. The other defendants were not served and did not appear. There was a trial before the court without a jury and a finding and judgment in favor of plaintiff for $1,093.75, to reverse which this appeal is prosecuted.

The record discloses that the nine defendants named on or about August 28, 1911, associated themselves together for the purpose of organizing a life insurance company under the laws of the State of Illinois; that they had taken certain steps in the organization of the company and sought subscribers to the capital stock; that plaintiff paid to defendants $1,000 for fifty shares of stock, which was to be issued when the company was completely organized.. The plan of the defendants to organize the corporation proved abortive and was abandoned. Thereafter plaintiff demanded the return of his money. The demand was refused on the ground that the money had all been spent for legitimate purposes in endeavoring to complete the organization of the corporation. Thereupon this suit was brought.

The defense interposed was that plaintiff had specially authorized defendants to expend the money for the expenses of selling stock, rents, clerk hire and other ordinary and usual expenses in and about procuring subscriptions to the capital stock and completing the organization of the proposed company, and that the money was so spent. The defendants further contended that the plaintiff knew the money was to be used for the purposes mentioned, and that he offered no objections but acquiesced therein. On the trial of the case, the defendants made no attempt to prove that plaintiff specifically authorized the expenditure of the money, but claimed that plaintiff knew that the money was being spent by defendants in an endeavof to complete the organization, and that plaintiff made no objection thereto, and in support of this latter contention it is argued that knowledge that the money was being expended was brought home to plaintiff by the fact that defendants had caused to be published the charter of the proposed company in a newspaper published and in general circulation in the City of Chicago, as required by paragraphs 178 and 179 of chapter 73, Rev. St. (J. & A. fifí 6455, 6456). Paragraph 179 provides that whenever the corporators of a proposed life insurance company, receive from the insurance superintendent a certified copy of the charter, it shall be published, and that they may then open books to receive subscriptions to the capital stock. The charter which was published provides, inter alia, that the corporators shall in advance fix the salaries to be paid to the officers, and that they shall pay all necessary expenses and costs of the organization, hire and employ all necessary help, fix the salaries of such help and employees, rent offices, provide and pay all necessary traveling expenses incident to the organization, and keep a just and true account of all receipts and disbursements; that they shall render the stockholders a full and complete account of all receipts and disbursements, together with vouchers and receipts for all expenditures, and shall turn over to the directors and officers of the company, when elected, all moneys and property, etc. And in addition to this notice, it is argued that it is the law that all persons subscribing for stock of a proposed corporation are presumed to know the provisions of its charter and articles of incorporation, and therefore the defendants had a right to expend the moneys in the necessary expenses incurred in the formation of the corporation, and that as plaintiff did not object he is presumed to have acquiesced in such expenditures and cannot recover.

There is no statement in the charter as published to the effect that the moneys of the subscribers in the proposed company were to be expended in the necessary expenses incurred in the formation of the company. Ñor do we think there is anything in the statute referred to that would warrant the conclusion that such moneys could be used in the manner contended for. The corporators of a proposed life insurance company, such as the one in the instant ease, are trustees of the funds received from subscribers, and it is their duty to conserve such funds and turn the same over to the company when the organization is completed, and if this is not done, and the money is expended for other purposes and such action has not been acquiesced in by the subscriber, he may sue the corporators in an action for money had and received. Greiger v. Salzer (Colo.), 165 Pac. 240; Watson v. Donald, 142 Ill. App. 110.

Defendants further contend that there can be no recovery in this case, for the reason that plaintiff must allege and prove that the defendants are guilty of misrepresentation, fraud and deceit which induced plaintiff to subscribe for stock; that the representations when made were known by the defendants to be false and were designedly made for the purpose of deceiving plaintiff, and that plaintiff acted as an ordinarily prudent person and honestly relied upon such representations to his injury, and that there is no such charge in the instant case, but on the contrary it appears that the money was honestly spent for legitimate purposes. It is true that there is no claim of misrepresentation or fraud or deceit made by plaintiff, and it further appears that the money was honestly spent in endeavoring to complete the organization, but this is no defense. Where a subscriber of stock in a proposed corporation pays money therefor to the corporators, and the corporation is never completed, he may recover in an action for money had and received. Watson v. Donald, supra; Greiger v. Salzer, supra; Miller v. Denman, 49 Wash. 217; Kempson v. Saunders, 4 Bing. (Eng.) 5.

The judgment of the Municipal Court of Chicago is affirmed.

Affirmed.


text:
    Otto C. Vondrak, Appellant, v. Reuben H. Donnelley, Appellee.
    Gen. No. 23,734.
    1. Libel and blandee, § 100

       — when declaration does not state cayse of action for libel. A declaration in an action on the case for libel, not averring special damage, alleging that defendant published the name of plaintiff, a dealer in window shades, under the heading “Wines and Liquors” in a classified telephone directory, does not state a cause of action.
    2. Evidence, § 44* — what presumed. It is presumed that a name entered in a classified telephone directory will not be brought to the attention of a large number of persons.
    Appeal from the Circuit Court of Cook county; the Hon. H. Steeling Pomeboy, Judge, presiding. Heard in the Branch Appellate Court at the October term, 1917.
    Affirmed.
    Opinion filed May 15, 1918.
    Oliver & Mecartney, for appellant.
    George W. Brown, for appellee.

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

   Mr. Justice O’Connor

delivered the opinion of the court.

This is an action on the case for a libel, brought by Otto C. Vondrak against Beuben H. Donnelley. A demurrer was sustained to the declaration and the suit dismissed.

The libel alleged is found in a certain classified telephone directory, entitled, “The Bed Book,” published and widely circulated in the City of Chicago, under the heading, “Wines and Liquors,” in words and figures as follows: “Franklin 4203 Brinckmann-Vondrak Co. 160 N. 5th.” It is alleged that this meant that plaintiff was then and there engaged in handling and selling intoxicating wines and liquors; that this was false; that plaintiff was not and never had been engaged in such business, but on the contrary plaintiff and his copartner, Theodore F. Brinckmann, were at the time engaged in the window shade business at No. 160 North Fifth avenue, under the firm name of Brinckmann-Vondrak Company; that at no time was plaintiff or his copartner Brinckmann engaged in the handling or selling of intoxicating wines or liquors of any description; and it is further averred that by reason of such publication by defendant plaintiff was injured in his good name, etc. There is no averment of special damages, and the question is, did the declaration state a cause of action?

Counsel for plaintiff say: “The words complained of permit of but one meaning — that plaintiff was engaged in the sale of intoxicating liquors. He was not then and never had been engaged in such business. One can best appreciate the effect of such words by asking himself the question, ‘How should I feel to be advertised as being engaged in the wine and liquor business V ” And it is argued that there is a moral question of great moment, as well as economic, involved. Continuing counsel say: ‘ ‘ The only question, therefore, involved in this appeal is: Whether or not the words of the publication in question are reasonably or fairly susceptible of any defamatory meaning as respects the plaintiff in his occupation or business, or tend to impair his credit, injure his character, disgrace him or deprive him of the confidence and goodwill of society or lessen its esteem for him, and thereby cause him mental distress.”

To sustain their contention that the declaration stated a cause of action, counsel rely on the case of Peck v. Tribune Co., 214 U. S. 185. In that case the matter alleged to be libelous was found in an advertisement printed in The Chicago Sunday Tribune, and it was averred that the advertisement represented that plaintiff was a nurse and had for many years used Duffy’s Malt Whisky as a tonic, both for herself and as a nurse, while the fact was that she was not a nurse, and did not either for herself or as a nurse use whisky. The Circuit Court of Appeals held that the advertisement was not libelous, or at most entitled plaintiff only to nominal damages. (154 Fed. Rep. 330, 83 C. C. A. 202.) The Supreme Court of the United States, however, held that the question was one for the jury. Mr. Justice Holmes, in delivering the opinion of the court, said (189): “The question, then, is whether the publication was a libel. It was held by the Circuit Court of Appeals not to be, or, at most, to entitle the plaintiff only to nominal damages, no special damage being alleged. It was pointed out that there was no general consensus of opinion that to drink whisky is wrong, or that to be a nurse is discreditable. It might have been added that very possibly giving a certificate and the use of one’s portrait in aid of an advertisement would be regarded with irony, or a stronger feeling, only by a few. But it appears to us that such inquiries are beside the point. It may be that the action for libel is of little use, but, while it is maintained, it should be governed by the general principles of tort. If the advertisement obviously would hurt the plaintiff in the estimation of an important and respectable part of the community, liability is not a question of a majority vote.

“We know of no decision in which this matter is discussed upon principle. But obviously an unprivileged falsehood need not entail universal hatred to constitute a cause of action. No falsehood is thought about or even known by all the world. No conduct is hated by all. That it will be known by a large number, and will lead an appreciable fraction of that number to regard the plaintiff with contempt, is enough to do her practical harm. * * * It seems to us impossible to say that the obvious tendency of what is imputed to the plaintiff by this advertisement is not seriously to hurt her standing with a considerable and respectable class in the community.”

It therefore appears in that case that from common knowledge, prima facie at least, the advertisement would be brought to the attention of a considerable class in the community and an appreciable number of such persons would regard plaintiff with contempt, and it would therefore do her practical harm. In the instant case, if we assume that the publication concerning plaintiff would, if brought to the attention of an “important and respectable part of the community,” cause such part of the community to regard plaintiff with contempt, yet we think it obvious that the matter complained of would be brought to the attention of, not a large part of the community, but only a very few; for it is obvious that a classified telephone directory is not read as a newspaper is, but that practically speaking only a few persons looking for persons engaged in the wine and liquor business would be informed of the publication, and it seems to us obvious that no considerable portion of such persons would look upon plaintiff in an unfavorable light. The number of persons who would think plaintiff engaged in the wine and liquor business would be further reduced by the fact that his individual name does not appear in the publication. "We are therefore of the opinion, there being no averment of special damages, and the presumption being that the publication would not be brought to the attention of a large number of persons, that plaintiff has failed to state a cause of action.

The judgment of the.Circuit Court of Cook county is affirmed.

Affirmed.


text:
    Theodore F. Brinckmann, Appellant, v. Reuben H. Donnelley, Appellee.
    Gen. No. 23,735.
    (Not to be reported in full.)
    Appeal from the Circuit Court of Cook county; the Hon. Look-wood Honors, Judge, presiding. Heard in the Branch Appellate Court at the October term, 1917.
    Affirmed.
    Opinion filed May 15, 1918.
    Statement of the Case.
    This appeal involves the other member of the firm involved in the case of Vondrak v. Donnelley, ante, p. 342, and the decision in the latter case controls herein.
    Oliver & Mecartney, for appellant.
    George W. Brown, for appellee.
   Mr. Justice O’Connor

delivered the opinion of the court.


author: Mr. Justice Thomson

text:
    John Feulner, Appellee, v. Anna Gillam, Appellant.
    Gen. No. 23,515.

    1. Pleading, § 404

       — when evidence admissible under plea. Semble, that if a plea is good on demurrer, the evidence offered in support of it should be held admissible.
    2. Evidence, § 327* — when parol evidence is inadmissible. Pursuant to the general rule that parol evidence is inadmissible to vary or contradict a written contract, if a bill or note is absolute on its face, evidence of a verbal agreement, made at the same time, qualifying its terms is not admissible.
    3. Evidence, § 327* — when parol evidence is inadmissible. Parol evidence is inadmissible to show that a note absolute on its face was to be paid to some other person than the one named therein as payee.
    4. Bills and notes, § 327* — what is no defense in action on note. It is no defense to an action on a promissory note that the plaintiff, although the holder of the legal title to the note, is merely a nominal party in interest and that the beneficial interest in the note is in another.
    5. Evidence, § 327* — when may be shown by parol that plaintiff is merely trustee or agent for another. Where the plaintiff in an action on a promissory note to which he has the legal title is, in fact, merely the trustee or agent for another who is the beneficial owner of the note, parol evidence is admissible to show such fact, provided the defendant has a good defense to the note as against the beneficial owner.
    6. Bills and notes, § 327* — what defense available where action is brought by trustee or agent. In an action to recover on a promissory note brought by one who, while holding the legal title, is merely agent or trustee for the beneficial owner of the note, defendant may interpose any defense which might be set up against the beneficial owner, just as though the action had been brought in the latter’s name.
    7. Bills and notes, § 420* — when error to exclude evidence as to ownership of note. In an action to recover on a promissory • note, where defendant sets up that her mother was the real owner of the note and had forgiven her the note and had directed that it be canceled and returned to defendant, it is error to refuse to admit evidence in regard to the beneficial ownership and to exclude from evidence a certified copy of the mother’s will by which the note was bequeathed to defendant.
    8. Evidence, § 223

       — what properly excluded as hearsay in action on note. In an action to recover on a promissory note in which defendant sets up that the mother’s estate and not the plaintiff was the beneficial owner, evidence of third persons as to conversations with the mother offered to show that the beneficial ownership was in another than plaintiff is properly excluded as hearsay.
    9. Witnesses, § 95* — when defendant not incompetent as witness. Hurd’s Rev. St. ch. 51, sec. 2 (J. & A. V 5519) does not apply to exclude the evidence of the defendant in an action to recover on a promissory note because of the fact that the defense is set. up that plaintiff is, in fact, as to such note, trustee for plaintiff's deceased mother and merely the holder of the legal title, where plaintiff seeks to recover as the absolute owner of the note.
    Appeal from the Superior Court of Cook county; the Hon. Joseph Sabath, Judge, presiding. Heard in the Branch Appellate Court at the October term, 1917.
    Reversed and remanded.
    Opinion filed May 15, 1918.
    Rehearing denied June 3, 1918.
    Spencer Ward, for appellant.
    Manierre & Pratt, for appellee.

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

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

   Mr. Justice Thomson

delivered the opinion of the court.

This is an action in assumpsit brought by the appellee on a promissory note for $8,000, in which he was the payee, against the appellant, the sister of the appellee and maker of the note in question. The defendant pleaded the general issue and also a number of special pleas. The plaintiff demurred to all the special pleas, and the demurrers were sustained to all except those designated as the second, third and fourth special pleas, to which the demurrers were overruled, whereupon the plaintiff filed replications to those pleas. In the second special plea, the defendant set forth that the plaintiff was without right of action as against her because, at the time of the execution of the note in question, he was the agent of the mother of the parties and had charge of her affairs and business and transacted the same in the mother’s name, and that the defendant being indebted to her mother, and for the purpose of evidencing said indebtedness, executed the note in question with the name of the plaintiff therein as payee, and that the plaintiff at no time had any interest in the note except as agent of his mother, who was always the sole owner of the note and the only one interested in the proceeds thereof, and that later the mother died testate, and her last will and testament was duly probated, in and by which will the mother gave and bequeathed the defendant said promissory note with all there was due thereon at her death, and directed that the note be canceled and delivered to the defendant, the plea concluding: “ Wherefore the said promissory note was before the time of the beginning of this suit, cancelled and discharged by the owner thereof, and this defendant was released from the payment thereof.” The third plea set up the same facts and concluded: “Wherefore the defendant became and was the legal owner of the said promissory note at and prior to the time of the commencement of this suit, and at the time of the commencement of this suit the plaintiff was not the legal owner or holder of said note.” The fourth special plea again recited the same facts except it did not set forth the provisions contained in the will with reference to the note, but merely that the mother left a last will and testament, and that the same had been duly admitted to probate, this plea concluding: “Wherefore the legal title to said promissory note is not and was not, at the time of the commencement of this suit, in the said plaintiff.”

On the trial, the plaintiff introduced the note in evidence and stated the amount alleged to be due thereon and rested. Thereupon, the defendant took the stand as the first witness in her behalf and her counsel asked her a number of questions based upon the line of defense set forth in the special pleas, to all of which the plaintiff objected. The court sustained these objections, and, in order to save the time of the court, the defendant made a formal offer of proof substantially following the line of defense as pleaded in her special pleas, to which objection was also made by the plaintiff and objection was sustained. The defendant further offered a certified copy of the last will and testament of her mother together with a certified copy of the proof of will in the Probate Court and the letter’s testamentary issued by that court. An objection being made to this, it also was sustained. The defendant then offered to show by a Mrs. Broeker that cer- ’ tain declarations had been made to the witness by the defendant’s mother to the effect that the plaintiff had managed all her affairs and that the sum represented by the note in question belonged to her (the mother) and not to her son. The court also sustained the objection made to this offer of proof. The defendant further offered to show by a Mrs. White, who was a witness to the mother’s last will and testament, that the mother had talked with the witness immediately after the date of making the will and stated that she had made the will largely for the reason that she was afraid from the way the plaintiff was acting that he would not do the right thing by the defendant. The court sustained the plaintiff’s objection to this offer of proof, whereupon the court, on motion of the plaintiff, instructed the jury to find the issues in his behalf, and to assess the plaintiff’s damages at the sum of $10,514. Judgment for the plaintiff in that amount followed, from which the defendant has appealed.

The defendant urges that the judgment of the trial court should be reversed and the cause remanded by reason of the alleged errors of the trial court in ruling upon the evidence. It is difficult to reconcile the rulings on the demurrers to the special pleas with the rulings on the evidence. If the pleas were good on demurrer, it would seem that the evidence which was offered in support of them should be held admissible.

It is a general principle of law that parol evidence is inadmissible to vary or contradict a written contract and therefore, if a bill or note be absolute on its face, no evidence of a verbal agreement made at the same time, qualifying its terms, can be admitted. This rule applies to the offer of parol evidence to the effect that the note was to be paid to some person other than the person named in the note as the payee. Daniel on Negotiable Instruments, sec. 80. It is no defense to an action on a promissory note that the plaintiff, although the holder of the legal title to the note, is merely the nominal party in interest and that the beneficial interest in the note is in some one other than the plaintiff. Illinois Conference v. Plagge, 177 Ill. 431. It is a matter of no consequence, so far as the defendant is concerned, who may be the equitable owner of the note. But this is true only where the defendant has no defense to the note as against the equitable owner. Caldwell v. Lawrence, 84 Ill. 161. Where the plaintiff sues on a promissory note to which he has the legal title and he, in fact, is merely the trustee or the agent for another who is the beneficial owner of the note, parol evidence is admissible to prove that fact, provided the defendant has a good defense to the note as against the beneficial owner, and, in such case, the defendant may interpose as against the plaintiff any defense which might be set up as against the beneficial owner just as though the suit had been brought in the latter’s name. Daniel on Negotiable Instruments, sec. 1181a; 8 Cyc. 61, 79; McHenry v. Ridgely, 3 Ill. 309; Merrill v. Randall, 22 Ill. 227; Belohradsky v. Kuhn, 69 Ill. 547; Chicago Fire Proofing Co. v. Park Nat. Bank of Chicago, 44 Ill. App. 150. It is pointed out in the latter case that where an action is brought by the legal holder, with the beneficial interest in another as to whom the debtor has no defense, “the debtor is protected by the judgment in favor of the legal holder, and the question of beneficial interest does not concern him, but only the holder and beneficiary.” But it will be clearly seen that where the debtor does have a good defense as against the beneficiary, a judgment in favor of the legal holder will afford him no protection. In the same case the court says: “Possession of the note is evidence of property in it, and the defendant cannot raise the question of beneficial ownership, save to make defenses available which would be good against such owner.”

We are, therefore, of the opinion that the trial court erred in sustaining the objections to questions put to the defendant with regard to the beneficial ownership of the note. The situation would have been different if the defendant sought merely to show that her brother, although possessing the legal title to the note, was merely the nominal owner, and that her mother was the real owner of the note, but her defense was more than that, namely, that her mother had forgiven her the note and directed that it be canceled and be given back to her. If the defendant could prove her contentions, she had a perfectly good defense on the note as against the beneficial owner, her mother, and if that were the case under the decisions referred to, she had the right by parol proof to establish the beneficial ownership in her mother and to show that defense. It follows that the court also erred in sustaining the plaintiff’s objection to the certified copy of her mother’s will.

We are of the opinion that the trial court was correct in sustaining the objection to the offer of testimony to be given by Mrs. White as being immaterial, and also in sustaining the offer of testimony to be given by Mrs. Broeker. That testimony was on the question as to whether another than the plaintiff was the beneficial owner, and was clearly hearsay as to the plaintiff.

It is urged by the plaintiff that all the rulings of the trial court on the evidence, so far as they concern the defendant as a witness, were warranted, by reason of the fact that, on her theory of defense, she, herself, would be an incompetent witness. In this connection, the plaintiff contends that inasmuch as the defendant seeks to defend on the theory that the plaintiff is in fact the trustee for their mother and the success of her defense depends upon the establishing of that trusteeship, she, the defendant, automatically becomes an incompetent witness under, the provisions of section 2 of chapter 51, Illinois Statutes (J. & A. 5519), providing that no party shall be allowed to testify therein in his own behalf when any adverse party sues or defends “as the trustee or the conservator of any idiot, habitual drunkard, lunatic or distracted person, or as the executor, administrator, heir, legatee or devisee of any deceased person, or as guardian or trustee of any such heir, legatee or devisee, unless when called as a witness by such adverse party so suing or defending. ’ ’ In our opinion, this section of the statute has no application to the situation in question. Assuming that the defendant is correct in her contention as to the real status of the plaintiff with regard to the note sued upon, that in no way changes the capacity in which the plaintiff has brought his suit. He would still remain the party plaintiff suing as one having the legal title to the note, and seeking, by the action brought, to recover thereon as the absolute owner of the note.

For the reasons given, the judgment of the Superior Court will be reversed and the cause remanded to that court for further proceedings consistent with the views herein expressed.

Reversed and remanded.


text:
    Auto Utilities Manufacturing Company, Appellee, v. U. S. Blow Pipe & Dust Collecting Company, Appellant.
    Gen. No. 23,595.
    (Not to be reported in full.)
    Abstract of the Decision.
    Corporations, § 325

       — what not within powers of corporation. Under a charter which authorizes a corporation “to manufacture, buy, sell, use, and deal in automobile specialties; to manufacture, buy, sell, use, and deal in and with machines, goods, wares, and merchandise of all kinds; to purchase, sell, lease and deal in inventions, patents, and processes, and in connection with its business of manufacturing, buying, selling, using, dealing in and with machines, goods, wares, and merchandise, patents, inventions, and processes, to construct, build, lease, own, and operate all necessary factories, shops, buildings and plants” the powers of the corporation are not such as to permit it to collect commissions for services rendered in procuring contracts for others even though those contracts involve such a subject-matter as would bring the contract within the corporation’s charter powers if it was making the contract itself, and even though the contract on Which the commission is claimed has been made in conjunction with and incident to a separate and distinct contract had by the corporation with the same party with which the other contract has been made.

      Appeal from the Municipal Court of Chicago; the Hon. Dennis W. Sullivan, Judge, presiding. Heard in the Branch Appellate Court at the October term, 1917.
    Reversed.
    Opinion filed May 15, 1918.
    Statement of the Case.
    Action by Auto Utilities Manufacturing Company, a corporation, plaintiff, against U. S. Blow Pipe & Dust Collecting Company, a corporation, defendant, to recover a commission on a contract between defendant and another. From a judgment for plaintiff for $120.75, defendant appeals.
    Henry N. Miller, for appellant.
    J. Edward Clancy, for appellee.

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

   Mr. Justice Thomson

delivered the opinion of the court.


text:
    Paul Brautigan, Administrator, Appellee, v. Union Overall Laundry & Supply Company, Appellant.
    Gen. No. 23,617.
    (Not to be reported in full.)
    Appeal from the Circuit Court of Cook county; the Hon. Samuel C. Stough, Judge, presiding. Heard in the Branch Appellate Court at the October term, 1917. Certiorari denied by Supreme Court (making opinion final).
    Affirmed.
    Opinion filed May 15, 1918.
    Rehearing denied May 28, 1918.
    Statement of the Case. .
    Action by Paul Brautigan, administrator of the estate of Franklin Brautigan, deceased, plaintiff, against Union Overall Laundry & Supply Company, a corporation, defendant, to recover damages for the death of plaintiff’s intestate, alleged to have been caused by a collision with defendant’s automobile arising through the negligent operation of the automobile by defendant’s servant. From a judgment for plaintiff for $3,000, defendant appeals.
    Cruice & Langille, for appellant; Daniel L. Cruice, of counsel.
    Landon & Holt, for appellee; John B. Fruchtl, of counsel.

      Abstract of the Decision.
    1. Automobiles and garages, § 2

       — what care must be exercised by one seehing to drive automobile on wrong side past approaching wagon. One seeking to drive an automobile past an approaching wagon on the wrong side must exercise care to give proper signals and not to pass at a high rate of speed, and this duty is not affected by the fact that the right side of the street is not usable.
    2. Negligence, § 106* — when of child will not be imputed to parent. In an action to recover for the death of one who, while walking in the street behind a wagon, was struck by an automobile which passed the wagon on the wrong side, negligence of the deceased’s son who was driving the wagon cannot be charged to deceased.
    3. Autqmobti.es and garages, § 3* — when evidence supports verdict for death of person in street behind wagon. In an action to recover for the death of one who, while walking in the street behind a wagon, was struck by an automobile as it passed the wagon on the wrong side and going at a high rate of speed without signals, evidence held sufficient to support a verdict for plaintiff.
    4. Automobiles and garages, § 3* — when instruction on prima facie case of negligence in operation of automobile is correct. In an action to recover damages for the death of a person killed by an automobile as he was walking in the street, it is not error to instruct the jury that “in an action brought to recover damages either to the person or property caused by running an automobile propelled by mechanical power along a public street through a residential portion of an incorporated city at a greater rate of speed than fifteen miles an hour, the plaintiff is deemed to have made out a prima facie case of negligence by showing the fact that the deceased was killed by said automobile and that the person running such automobile was at the time of the injury running the same at a rate of speed greater than the law permits,” even though there was but slight evidence that the district in which the accident occurred was a residential district, where the evidence, in other respects, makes out more than a prima facie case of negligence.
    5. Death, § 73* — when instruction correct on damages for wrongful death. In an action to recover for wrongful death, an instruction that if the jury believe from the evidence that the deceased “while in the exercise of ordinary care for his safety and without fault or negligence on his part lost his life by and through the negligence of the defendant, as charged in the declaration or in either count thereof, as amended, and that said Franklin Brautigan [the deceased] left him surviving next of kin, then you should find the defendant guilty and assess the plaintiff’s damages at such sum as you believe from the evidence will be fair and just compensation based upon the pecuniary loss, if any, resulting from the death of the said Franklin Brautigan to his said next of kin, not exceeding the sum of ten thousand ($10,000) dollars” is proper, even though it suggests the assessment of damages at a sum not exceeding that named in the declaration and omits the words “under the instructions of the court,” especially where the verdict is for a less sum than the maximum named.

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

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

   Mr. Justice Thomson

delivered the opinion of the court.

6. Automobiles and garages, § 3 — when instruction on care in. operation of automobile is not erroneous. In an action to recover for the death of a person struck as he was following a wagon in the street by an automobile which the evidence shows was passing the wagon on the wrong side while going at a high rate of speed and without signals, it is not error to instruct that an automobile driver using the highway must use reasonable care to avoid injury to others.

7. Instructions, § 151* — when properly refused. Refusal to give an instruction the substance of which is embraced in other . instructions given is not error.


text:
    Harry Homewood, Appellee, v. Myer J. Stein, Appellant.
    Gen. No. 23,625.
    (Not to be reported in full.)
    Abstract of the Decision.
    1. Appeal and error, § 711

       — what not considered on appeal. Alleged facts which do not appear in the record will not he considered on appeal.
    2. Appeal and error, § 1574* — when power of attorney to confess judgment containing waiver of right of appeal may not be complained of. That a power of attorney to confess judgment for unpaid rent contains a provision waiving the right to appeal, cannot be complained of by defendant on an appeal from a judgment confessed thereunder, where plaintiff has not attempted to interfere with defendant’s enjoyment of the right of appeal.
    3. Landlord and tenant, § 327* — when attorney’s fees are not unreasonable in amount. Where a power of attorney to confess judgment for rent specifies the amount to he allowed as attorney’s fees, it is not error to allow such amount unless it is clearly unreasonable, and such unreasonableness is not apparent from the fact that the fee is almost as large as the instalment of rent for which judgment is confessed.

      Appeal from the Municipal Court of Chicago; the Hon. Arnold Heap, Judge, presiding. Heard in the Branch Appellate Court at the October term, 1917.
    Affirmed.
    Opinion filed May 15, 1918.
    Statement of the Case.
    Action by Harry Homewood, plaintiff, against Myer J. Stein, defendant, for rent. From a judgment by confession for plaintiff for $36.50 and $25 attorney’s fees, defendant appeals.
    Maurice G. Cohen, for appellant; Myer J. Stein, of counsel.
    No appearance for appellee.

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

   Mr. Justice Thomson

delivered the opinion of the court.

4. Landlord and tenant, § 330* — when judgment for rent under power of attorney to confess judgment not disturbed. Where a power of attorney to confess judgment for rent is exercised within its limitations and judgment is entered for a certain and liquidated sum, namely, one month’s rent at the monthly rental specified in the lease, the judgment will not be interfered with.