author: Mr. Justice Hebel delivered

text:
    Frances Thiel, Appellee, v. Material Service Corporation, Appellant.
    Gen. No. 37,878.

      Opinion filed December 27, 1935.
    Rehearing denied January 7, 1936.
    Miller, Gorham, Wales & Adams, of Chicago, for appellant.
    Finn & Miller, of Chicago, for appellee.
   Mr. Justice Hebel delivered

the opinion of the court.

The defendant, Material Service Corporation, is here on appeal from a judgment of $15,000, which was entered in the superior court of Cook county on the verdict of a jury in an action of trespass on the case. The plaintiff was riding as a guest in an automobile and her injuries occurred when the automobile and a truck, driven by a man named Stine, collided.

The cause was tried upon plaintiff’s amended declaration, in which five defendants were named, two of which were dismissed from the case, and the jury returned a verdict of not guilty in favor of John Beiderer and H. C. Bollman, defendants, and guilty against the Material Service Corporation for the amount herein stated.

The facts appearing from the evidence are that a collision occurred August 16, 1930, on Archer avenue near the entrance to Bethania Cemetery, in Cook county, between the automobile in which the plaintiff was riding as a guest, and a truck driven by Stine. The principal issue in the case as stated by the defendant is whether the Material Service Corporation can be held liable under the doctrine of respondeat superior for the negligence of Stine in the operation of the truck, or the defendant can be held liable for lack of repair to the truck or its unsafe condition. For the purposes of this appeal, the defendant concedes that there is evidence from which the jury might find that Stine was negligent, or that the truck was in an unsafe condition.

John Beiderer was the owner of the truck involved in the accident. He was in the trucking business, and the truck had his name printed on the body of the cab. H. C. Bollman was a cartage contractor, who had a written contract to haul the stone and other materials of the Material Service Company, which was in the business of selling* such materials. The contract provided, in substance, that Bollman would haul all the stone from certain named quarries as directed by the Material Service Corporation, and that Bollman had the exclusive right to haul from these quarries. Boll-man was to be paid for hauling at certain rates per mile measured from the Peoples Crushed Stone Co. quarry by a straight line to the point of delivery regardless of detours. The mileage was so measured regardless of the quarry from which the delivery was made, except in the case of the Blmhurst-Chicago one, from which the mileage was measured direct. It was provided in the contract that Bollman would own and operate at least 15 trucks, and that he would furnish all necessary trucks up to the number of 30. By the contract, Bollman was to be paid for all crushed stone in the last half of the month on the 10th of the succeeding month, and for all stone in the first half of the month, on the 25th. He was to be paid “whether such cartage be performed by the motor trucks owned by Bollman or by subcontractors hired by him to do such work.” It was agreed that Bollman should at all times employ competent men in the operation of the trucks, should carry public liability insurance on all hired trucks, and compensation, public liability and property damage insurance on all trucks owned and operated by him. It also appears from the contract that all trucks employed in the delivery of materials should carry a sign bearing the name “Material Service Corporation,” to be furnished by that company. The contract was for two years from March 18, 1930.

Stine was a truck driver who had hauled materials from the Material Service Corporation yards on one or two occasions prior to Boilman’s contract. The contract was entered into, as we have stated, in March, 1930, and in June of that year Stine hauled materials from the yards of the Material Service Corporation with a truck owned by Frank Beiderer, who was also in the trucking business. The compensation for this hauling was apparently paid in the same manner as the subsequent hauling, namely, to Bollman. He deducted his commission and paid the balance over to Beiderer. This truck was damaged in an accident and could not be used. Stine went to Frank’s brother, John Beiderer, and asked if he could get his truck to use in hauling. All John Beiderer knew of Stine was that he had worked for his brother. John Beiderer gave him the truck and Stine continued to haul from the Material Service yards. In doing this hauling, he followed the usual procedure. He received a ticket from the shipping clerk of the Material Service Corporation-showing the destination of Ms material. He would have one copy signed by the person to whom the material was delivered and return the signed copy to the office of the shipping clerk. Bollman’s contract required that all cartage be evidenced by such signed receipts. These-tickets were collected by Bollman, and from them he made up bills to the Material Service Corporation. Bollman had about 17 trucks, which he owned, and there were some 18 or 20 other trucks owned by about a dozen different owners. All of these trucks followed the same general plan, except that the signed delivery tickets for the trucks owned by Boll-man were left directly at his office. Separate bills were rendered by Bollman for the trucks he owned and for each other owner of trucks. These bills were made up the first and fifteenth of each month to cover cartage of the preceding half month. Bollman rendered five bills, some of several sheets marked John Beiderer, covering the period from the 16th of June, 1930, to the end of August. These bills were computed in accordance with the written contract with Bollman. Material Service Corporation sent Bollman its checks for the amount of these bills, and he deposited the checks to his account. Bollman issued his checks to and paid John Beiderer for the amounts so received less Bollman’s three per cent commission. Beiderer paid Stine at the rate of $7.50 a day, the regular union wage for truck drivers. He paid Stine his wages for the day of the accident.

During* this period from the middle of June until the end of August, Stine appeared at one of the yards of the Material Service Corporation around six-thirty or seven in the morning. He awaited his turn for a load, and when he had one, took a delivery ticket showing the destination. He chose the route he would take himself. He would make the delivery, obtain the signed delivery ticket, and return for another load. When the truck needed gas or oil he obtained the same from a certain filling station and charged the amount to John Beider er. John Beider er paid for the gas and oil, as he did for all upkeep and repairs on the truck. At night, Stine stopped work around 4:30, and took the truck back to the hotel or rooming house where he lived. He let it stand out near there all night.

On August 16, 1930, Stine obtained a load of stone at one of the yards of Material Service. He delivered the stone at Keene and 123rd street. He was coming back empty northeast on Archer avenue on his way to lunch which he usually ate at a place in Lyons. The truck was carrying the sign of the Material Service Corporation.

The evidence of witnesses was conflicting as to how the accident happened, but it is clear the truck slowed down and skidded across on the southbound side of the street and collided with the car being driven southwest by Mrs. Strieder in which the plaintiff was riding. The evidence of a defective or unsafe condition in the truck was that the brakes locked the wheels and caused the skidding.

After the accident, John Beider er paid for the repairs to the truck. Stine with Beiderer’s knowledge and consent continued to haul materials from the Material Service Corporation yards. Bollman rendered the bill for hauling for the last half of August, received his compensation and paid Beiderer the amount less the commission. This bill and this payment included the delivery which Stine had made at Keene and 123rd street on August 16, 1930. Beiderer continued to pay Stine at the rate of $7.50 a day.

Shortly before Labor Day, Stine had his cousin do ■ the hauling while he went away for a day or two. While Stine was away, Beiderer discovered that the cousin was hauling some furniture for his relatives in the truck. Beiderer thereupon took the truck away and kept it.

There is evidence of the steps taken by Stine before he started hauling in the early summer of 1930. He went to a shipping clerk named Heinie and asked if the work would be available if he got a truck. Thereafter he used Frank Beiderer’s truck. Wlien that was wrecked, Stine went to Leonard Buck, a shipping clerk of the Material Service Corporation, and asked if he could haul. Stine testified that Buck said that Boll-man’s consent would have to be obtained, and that Buck obtained it by telephone in the presence of Stine. Bollman testified that there was no such conversation. In any event, Bollman shortly thereafter knew that John Beiderer’s truck was hauling because he received the delivery tickets and began billing for the work of Beiderer’s truck. Bollman testified he did not like the idea of Stine hauling there with Beiderer’s truck, and he told Buck, the shipping clerk, to get rid of him as soon as possible. . However, Bollman continued to get the delivery slips and render bills for the hauling done by Beiderer’s truck for two months thereafter.

There is evidence that Stine himself determined what routes he would take and the manner in which he would drive the truck. The only instruction in this respect evidenced by the record was the testimony of Stine that Beiderer told him to take care of the truck. Bollman gave no instructions to the drivers of his own trucks or any of the others driving under his contract except to report and deliver as indicated by the delivery slips.

The defendant’s theory is that the Material Service Corporation is not responsible under the doctrine of respondeat superior for the negligent driving of the automotive truck by Stine, which was the cause of the injury to the plaintiff, and for reasons, urged that the doctrine of respondeat superior is only applicable where the person sought to be charged has the right to control the action of the person committing the injury.

This question has been before the courts of appeal in this State, and in order to properly consider the question now before this court, it is well to have in mind the rules which apply to this doctrine. One of the factors that must be considered is whether the worker is an employee or an independent worker. If the employer directs where to unload and how the unloading is to be done and retains the right to discharge the employee, the relationship of employer and employee is established. Van Watermeullen v. Industrial Commission, 343 Ill. 73. In order to hold the employer liable under this doctrine, the employee must be subject to the employer’s control as to the terms, kind, results and duration of employment, which must be sufficient to establish the relationship of employer and employee. It is also important in discussing this question to take into consideration that when the employer had given instructions to the employee, the employee could proceed with the work without the necessity of any interference by the employer, and that when the work is not of a character requiring a great deal of supervision, failure to supervise does not change the relationship of employer and employee. Franklin Coal & Coke Co. v. Industrial Commission, 296 Ill. 329.

To determine whether the defendant is liable for the negligent operation of the truck which caused the injury to the plaintiff, this court must consider the evidence. We find from this record that Stine, who was the driver at the time of the accident, applied to the Material Service Corporation, for work; that he talked to a shipping clerk named “Heinie” and obtained a truck from Frank Beiderer and proceeded to haul stone, and used for that purpose Frank Beiderer’s truck; that this continued until the truck was wrecked, when he again applied to the same company and talked to Leonard Buck, a shipping clerk of the defendant, and he again asked for work of hauling. Stine testified that Buck stated to him that Bollman, who had the contract to do hauling and to supply the trucks, would have to give his consent, and that the agent of the defendant, Buck, obtained Bollman’s consent by use of the telephone in the presence of Stine. This, however, was disputed by Bollman. Subsequently, Bollman learned that John Beiderer’s truck was hauling, because he received delivery tickets and began billing for the work of Beiderer’s truck. Bollman directed Buck to discharge Stine, which he did not do.

There is evidence in the record, as we have indicated, that Stine, the driver, was told to go to work with a • truck, and it appears that his employment commenced from the time he had a talk with the man he called “Heinie.” The defendant, however, contends that the contract of the defendant with Bollman is material, for it bears upon the question of the right of the defendant to employ men to haul materials covered by this contract. That may be so as between the defendant and Bollman. However, the question of the breach of the contract is not before us. The matter we are obliged to determine is whether Stine was employed by the Material Service Corporation to haul materials by the use of the truck. That he was so employed is evident from the fact that Bollman did not send Stine to defendant’s quarry to work or haul material; that he did not know that he was so employed until he learned at the office of the Material Service Corporation that the name of Beiderer appeared on a delivery ticket; that he spoke to the shipping clerk, Leonard Buck about the truck being used, and asked him to discharge Stine, who was driving the truck, but that Buck because of reasons refused to discharge Stine. This all happened prior to the accident, and the record discloses the following facts sufficient for a jury: First, the employment by Stine to do hauling by the use of a motor truck; secondly, the insistence of Boilman that Stine be discharged by Buck, the agent of the defendant, and his refusal to discharge him. This evidence is in the record. It is also in the record that Stine was directed, in the operation of his truck when he appeared at the defendant’s yards, as to the loads he was to receive and deliver, and the time within which all this was to be done. From the application of the rule of law outlined herein, it would seem that the evidence tends to establish that the defendant is liable for the negligent operation of the motor truck by Stine as its driver at the time of the accident, and that question of fact is one for a jury.

The defendant urges that the court erred in instructing the jury on the law relating to master and servant and independent contractors. The defendant also questions the giving of a certain instruction presented to the court by the plaintiff as being reversible error. The plaintiff, however, has called to our attention the fact that objections to the instruction were not specific, and under sec. 67 of the Civil Practice Act and 27 of the Rules of Court, it does not appear that the specific objection to the instruction was made before the jury retired, and by reason of that failure the defendant is in no position to urge that the giving of the instruction was erroneous. People v. Schneider, 360 Ill. 43; People v. Reeves, 360 Ill. 55; Paulick v. National Bank of Republic, 279 Ill. App. 160; and Greer v. Shell Petroleum Corp., 281 Ill. App. 238.

The ruling of the trial court in refusing to give the special interrogatory is questioned by the defendant. The form of this interrogatory is as follows:

“Did the Material Service Corporation have the legal right to control the manual operation of the motor truck upon the highway at and before the time and place of the collision?”

It would seem that the form of the special interrogatory presented left it to the jury to determine whether the Material Service Corporation had a legal right to control the operation of the motor truck. The question should be directed to questions of fact, and then only to ultimate facts involved in the litigation. Pressley v. Bloomington & Normal Ry. & Light Co., 271 Ill. 622; City of Beardstown v. Clark, 204 Ill. 524; Chicago & N. W. Ry. Co. v. Dunleavy, 129 Ill. 132.

Other objections have been called to our attention, and it is contended that the court erred in the conduct of the trial. We have considered the questions complained of, and are unable to find that the court by its act committed error in its ruling upon the questions to which objections were made.

Finally, the defendant complains of the excessive amount of. damages allowed by the jury. From the evidence "relating to the injuries suffered by the plaintiff, we find that the plaintiff’s left leg is enlarged from the knee down, including both the knee and the ankle. The knee joint is limited as to motion, and the leg is practically stiff. In order to be able to walk, she has to throw the knee from the hip, the knee being of no assistance in taking a step. This causes a considerable strain on the spine, and gives rise to continued and repeated pains in the back. Before the injury the plaintiff was a music teacher, and in the pursuit of this occupation she has been greatly handicapped because of her inability to get around to her pupils and to use the pedal of the piano with this stiff leg. There is evidence that this condition of stiffness is permanent and incurable. The total expense of medical services as a result of this injury was from $1,500 to $1,600, and we are unable to find from the record that the amount allowed by the jury was excessive.

From an examination of this record and the questions involved, we do not find that there was such error in the court’s ruling* upon the questions called to his attention, or upon the objections called to our attention, nor the remarks of counsel in the presence of the jury, such as would justify this court in reversing the judgment; it will, accordingly, be affirmed.

Judgment affirmed.

Hall, P. J., and Denis E. Sullivan, J., concur.


source: Caselaw Access Project

author: Mr. Justice Hebel

license: Public Domain

text:
    Elsie Plewe, Appellee, v. Chicago Motor Coach Company, Appellant.
    Gen. No. 37,900.

      Opinion filed December 27, 1935.
    Rehearing denied January 7, 1936.
    William C. McHenry and Arthur J. Donovan, both of Chicago, for appellant; Samuels, Creenberg, Wolfe & Solomon, of Chicago, of counsel.
    Royal W. Irwin, of Chicago, for appellee.
   Mr. Justice Hebel

delivered the opinion of the court.

This cause is in this court for review upon an appeal by the defendant from a judgment of $3,000 entered by the court upon the verdict of a jury. The judgment appealed from is based upon an action for personal injuries sustained by the plaintiff on the afternoon of October 12, 1932, by reason of the negligent operation of defendant’s motor coach in turning from State street into Randolph street, in Chicago.

Plaintiff’s declaration is in two counts. The first alleges general negligence in the operation of the bus by the defendant’s agent, and the second alleges that as the motor bus approached the plaintiff the defendant failed to give reasonable warning of its approach and failed to use every reasonable precaution to avoid injuring the plaintiff.

The evidence is not disputed that the plaintiff was crossing Randolph street on the east cross-walk of State street early in the afternoon of October 12,1932; that as she was walking on the east cross-walk the defendant’s motor bus was making a right-hand turn from State street into Randolph street at the southeast corner of the intersection to proceed east. The coach at that time was moving at the rate of 5 or 6 miles an hour; that at the time the plaintiff was walking on the cross-walk she passed in front of the bus. The facts are disputed as to just how and when the plaintiff was injured.

The motor bus was 28 feet long, and in turning, the motor driver made a turn to the east, and at that time the front of the bus extended into Randolph street 7 or 8 feet, and the rear was near the curb at the intersection. The driver saw the plaintiff when she passed, together with several other persons who were walking. The accident occurred in the heart of the business district of Chicago, and at the time of the accident, between one and two o’clock in the afternoon, the thoroughfare was congested.

Plaintiff’s evidence is to the effect that when she passed the front of the bus and was within a few feet of the curb she was struck in the back by the bus and thrown forward on her hands and knees and that the right rear wheel passed over and injured her left foot. Several witnesses testified that she, the plaintiff, was thrown on her hands and knees.

Defendant’s theory is that it is not a matter of importance what caused the plaintiff to fall, since, in any event, the evidential facts show that such fall was not due to negligence on the part of the driver of the coach and that without evidence showing negligence there can be no recovery by the plaintiff. However, the motor driver did see the plaintiff pass in front of the motor coach, and it is a fact that the driver knew or should have known that if the turn made at this intersection is not wide enough the rear of the coach will come close to the curb. The motor driver cannot assume, in making the turn, that his only duty is to look ahead. At that time he had notice and knew that the plaintiff, together with other persons, was passing in front of the coach, and it was his duty to drive so that there would be proper clearance between the bus and the curb, to permit the plaintiff to reach the curb in safety. It was his duty in properly driving the bus to avoid injury to any person lawfully on the street at the . time and under the circumstances.

We cite with approval what was said by Berry in the Sixth Edition on the subject of automobiles, Vol. 1, sec. 221, wherein the author said:

“Reasonable care requires greater caution on the part of motorists at street corners and intersections and on the more thronged streets of a city than on the less obstructed in the open or suburban parts. It is the duty of a driver of a vehicle when turning a street corner to give people who are crossing the street some opportunity of escape from his vehicle, because the turning of the corner is often unexpected, and unless care is exercised pedestrians are liable to be injured, and to this end he should have his car under complete control.” The author in support of his statement included among the cases cited Grier v. Samuel, 4 Boyce (27 Del.) 106, 86 Atl. 209, wherein the court said:

“It is the duty of the person operating an automobile, or any other vehicle, upon the public streets of a city to use ordinary care in its operation, to move at a reasonable rate of speed, and cause it to slow up or to stop if need be, where danger is imminent and could, by the exercise of reasonable care, be seen or known in time to avoid accident. Greater care is required at street crossings and in the more thronged streets of a city than in the less obstructed streets in the open or suburban parts. ’ ’

The defendant further contends that the duty of the driver of the coach was only to keep a proper lookout • ahead so as to avoid collisions with other vehicles or with pedestrians passing in front of the motor coach; that it is not the driver’s duty to watch the rear of the motor coach being driven by him.

In the instant case the driver had knowledge of persons passing in front of his bus while he was making the turn, and also that in making the turn unless a wide turn was made, by reason of the length of the motor bus, persons using the cross-walk would be caught at the curb line.

It is a matter of general knowledge that motor cars have installed therein rear view mirrors to enable the driver to see conditions at the rear of the motor car. The driver in this case evidently assumed that he was clear of the curb and proceeded until he was stopped. The facts and circumstances in each case must be considered in order to determine whether there was negligence in the driving’ of the car.

Complaint is made as to the size of the verdict. Plaintiff received services of the hospital, where she remained 17 days. After 15 days in the hospital a cast was placed on her injured foot, which remained in place three weeks.

Upon the trial the plaintiff still suffered pain in the instep and big toe of her left foot. She cannot move her toes either forward or backward. At times the ankle swells, and while plaintiff wears a size six shoe on her right foot, because of the injury she is obliged to wear a size eight on her left foot.

X-rays were taken and read by a doctor qualified to interpret the pictures. The doctor testified, in substance, that there was a fracture of the fifth toe of the left foot. The X-ray also shows a spicule of bone about three-quarters of an inch long and one-sixth of an inch wide at the lower edge of the cuboid bone, which is one of the seven bones of the foot which form the arch. The function of the cuboid bone is to form a joint with the others, the fourth and fifth toes, as well as with the external cunei bone and the navicular bone, which together form the arch of the foot. The cuboid bone supplies attachment, and the area of insertion of muscles, ligaments and affects the strength of the arch of the foot. This particular spicule of bone is in direct line or path of the body weight bearing line, and may interfere with the body weight bearing surface of the affected foot.

The evidence tends to indicate a permanent injury, and this being a question for the jury, we are not impressed by the contention of the defendant that the damages are excessive or that the verdict in this respect is contrary to the weight of the evidence.

The defendant also contends that Dr. Mitchell, a witness produced by the plaintiff, was not the attending physician, but that his examination was made only for the purpose of qualifying as a witness. The doctor testified that he saw from the plate a spicule of bone, which he described as a periosteum fracture or tear; that it “may interfere with the body weight bearing-surface of the affected foot.” We agree with the defendant that the presence of the spicule bone was disputed. The defendant’s witness, Dr. Zeitlin, after an examination of the plate, testified that there was no spicule of bone shown. This question was also passed upon by the jury in its finding for the plaintiff. Perhaps the jury believed that this doctor was mistaken when he testified that if he were to take a picture of the other foot it would likely show a bone such as appeared in the picture of the left foot. After the doctor testified, an X-ray was taken of the right foot. Dr. Mitchell was recalled and examined the plate and testified that there was no evidence of a spicule bone under the cuboid bone, and that the cuboid bone of the right foot was normal.

Other criticism is made of Dr. Mitchell’s testimony. However we have examined the evidence as to his description of the foot, in which he said, on the question of permanency, that it “may interfere with the body weight bearing surface of the affected foot, ’ ’ and it is apparent that his answer left the question open for the jury to determine from the evidence whether the fracture as described by the doctor affects the weight bearing surface of the injured foot.

It is contended that the court erred in refusing to receive in evidence a copy of the hospital record made at the time the plaintiff was treated in the Iroquois Hospital. The plaintiff replies that no evidence was offered as to the authenticity of the record nor as to when and by whom it was made. Upon this question the court did not err in its ruling. The only witness produced was the witness in charge of the records of the hospital. The record is silent as to the whereabouts of the doctor or the nurses who attended the plaintiff in this hospital, or in whose handwriting the entries were made. The hospital record was offered in evidence for the purpose of contradicting plaintiff’s testimony as to how she fell at the time of the accident.

The final question concerns the giving by the court of plaintiff’s instruction as to damages. The instruction is objected to on the ground that there is no evidence of permanent injury, and that the attending physician was not produced as a witness, although plaintiff was calling* upon the attending physician. Other criticism is made of this instruction, but from our examination, we find as a part of the instruction the court instructed the jury that “you may also consider whatever evidence there is, if any, as to whether any of such physical injuries, if any, are permanent,” and we are of the opinion that the instruction was not prejudicial. The other objection to this instruction is without merit. Therefore the giving of the instruction was not reversible error.

For the reasons stated in this opinion the judgment is affirmed.

Judgment affirmed.

Hall, P. J., and Denis E. Sullivan, J., concur.


text:
    Continental National Bank and Trust Company of Chicago v. Chicago Builders Building Corporation et al. Melvin L. Straus v. Chicago Builders Building Corporation et al. American National Bank and Trust Company of Chicago, Appellee, v. Harriette Elliott, Appellant.
    Gen. No. 37,925.
    Opinion filed December 27, 1935.
    Cohon & Goldstein and J. Kentner Elliott, all of Chicago, for appellant.

      SoNNENSCHEIN, BeRKSON, LiAUTMANN, LeVINSON & Morse, of Chicago, for appellee; Isaac E. Ferguson, of Chicago, of counsel.
   Mr. Justice Hebel

delivered the opinion of the court.

This is an appeal by the respondent, Harriette Elliott, from a decree entered in the circuit court of Cook county, directing that a permanent injunction issue restraining her from proceeding in an action pending in the municipal court of Chicago, wherein the respondent is plaintiff and the Chicago Builders Building Corporation is defendant, which decree was entered upon the petition of the American National Bank and Trust Company of Chicago, as trustee.

From the petition it appears that the petitioner has been successor trustee since January 14, 1932, under the first mortgage trust deed dated June 28, 1926, under which trust deed a decree of foreclosure was entered in the cause in which the instant petition was filed, entitled Continental National Bank and Trust Company of Chicago, as trustee, v. Chicago Builders Building Corporation, et al.; that under the decree of foreclosure the court found that the amount of indebtedness $5,000,000 due thereunder on the bonds secured thereby had, on March 30, 1932, been declared by the petitioner, as trustee, to be due; that thereafter no sale was had pursuant to such decree. In the suit entitled Harriette Elliott v. Chicago Builders Building Corporation, which suit is still pending in the municipal court of Chicago as case number 2770097, the plaintiff claims to be the owner of and asks judgment on bond No. 6919 for the sum of $1,000, executed by the Chicago Builders Building Corporation, being one of the bonds secured by the trust deed; that the cause then pending in the municipal court was set for trial on June 8, 1934, and petitioner fears judgment will be entered at that time. That the bond in question contains the following language:

“For a more particular description of the covenants of the Mortgagor as well as for a description of the mortgaged property, the nature and extent of the security, the rights of the holder of this bond, the terms and conditions upon which the bonds are issued and secured and the method of payment thereof, reference is made to such Indenture, to all provisions of which this bond and each coupon hereto attached are subject, with the same effect as if the same were herein fully set forth. . . . Said Indenture and this bond as well as all of the other bonds aforesaid are to be taken and considered together as parts of one and the same contract. ’ ’

The trust deed provides in part as follows:

“No action at law or suit in equity shall be brought by, or on behalf of, the holder or holders of any bonds or coupons, whether or not the same be past due, except by the Trustees or by the requisite number of bondholders acting in concert under the provisions of this Section for the benefit of all bondholders. In the event that pursuant to the terms hereof the holders of Twenty-five per cent (25%) in principal amount or more of the bonds then outstanding, shall have joined in exercising the right to act in lieu of the Trustees, the remainder of the bondholders shall have no right to institute any legal or equitable proceedings of the same in a similar character for the same default of the Mortgagor. ’ ’

The petitioning trustee further states that Harriette Elliott has not complied with the provisions of such trust deed in bringing her suit at law; that her bond is less than 25 per cent of the total outstanding bonds; that the bond matures May 28, 1941; that Harriette Elliott sued for the principal amount thereof, relying on petitioner’s having accelerated the maturity of all such bonds; that this action is based on petitioner’s rights in such trust deed, and that she should not be permitted to use such trust deed to her advantage and disregard its provisions when deemed to her disadvantage.

It appears by reason of the above, petitioner fears Harriette Elliott will obtain a preference or priority over other bondholders; that petitioner is in possession of the mortgaged property and is collecting the rents and profits thereof, but fears that if the plaintiff obtains a judgment she will endeavor to interfere with petitioner in the collection of rents, and will prevent petitioner from complying with the decree heretofore entered; that petitioner has no remedy at law to prevent her from violating and disregarding the provisions of said trust deed; that by reason of the threatened action of Harriette Elliott the petitioner and those bondholders represented by it are threatened with irreparable damage and are without remedy except in equity, and the petitioner prays for a temporary, as well as a permanent injunction restraining Harriette Elliott from prosecuting* or attempting to prosecute her action.

To this petition the respondent filed her written motion to strike the petition on the ground that she never was a party to the proceeding, and that the suit sought to be enjoined is an action in personam to which petitioner is not and never has been a party. The court denied the motion of the respondent to strike the petition, and entered the order for the issuance of a permanent injunction, from which the respondent brings this matter to this court on appeal.

The petitioner in this case contends that regardless of the effect, as between respondent and the debtor corporation, of the provisions of the bond and trust deed respecting actions on ..the bonds and trust deed, said provisions clearly and emphatically manifest an intention and design to prevent interference by one bondholder with the action taken or to be taken by the trustee on behalf of all the bondholders.

The general rule of law is that the trust deed and the defendant’s bond, as well as all the other bonds secured by the trust deed, are to be taken and considered in determining whether defendant has a right to sue. This question has been passed upon by the Supreme Court in the case of Oswianza v. Wengler & Mandell, 358 Ill. 302, to which our attention has been called. The court said:

“The sole question in the case is whether the defendant in error has a right to sue at law for the recovery of the amount of these bonds or is relegated to the provisions of the so-called ‘no-action clause’ appearing in the trust deed. It is conceded that in the absence of provisions of the trust deed the holder of a note or bond secured by a mortgage may waive the right to apply to the security and sue at law in a personal action, and so the question here is whether the no-action feature of the trust deed is to be read into the bonds. . . .

“There is substantial authority for the position that the right to sue is an essential ingredient of negotiability. (Shaw v. Merchants Nat. Bank of St. Louis, 101 U. S. 557, 25 L. Ed. 892.) It does not follow, however, that all notes or bonds on which a right to sue exists are negotiable instruments, and so negotiability is not a primary factor in determining whether a right to sue at law exists here. Nor are we impressed with the argument that these bonds have matured and are no longer negotiable, and that the rule regarding the right to sue, as an essential element of a negotiable instrument, does not apply. Such begs the question, since the right to sue on any negotiable instrument does not accrue before the instrument becomes due.

“Regardless of the negotiability of these bonds, the first question here is whether the bonds by their terms are subject to the provisions of the trust deed affecting the right to sue. It is not to be doubted that the quoted provision of the trust deed limited the right of the bondholders to sue, and if such provision may be said to have been incorporated by reference into the bond, defendant in error has no right to sue thereon.

“It is argued that the bond and trust deed having been made at the same time and as a part of the same transaction, the universal rule of the construction of contracts requires that they be read and construed as constituting a single instrument. Counsel’s statement of the general rule is correct. (Crandall v. Sorg, 198 Ill. 48; Wilson v. Roots, 119 id. 379.) There is, however, a well recognized exception in cases of mortgages and notes. If all the agreements contained in the mortgage be, as a matter of law, imported into the note, the well recognized rule that a note negotiable on its face retains its negotiable character notwithstanding it is secured by a mortgage upon real estate could not obtain, for it is generally true that a negotiable instrument cannot be bound up and fettered with collateral agreements. The note or bond is a distinct promise to pay money. The pledge of real estate to secure that promise is a different and distinct agreement, which • ordinarily in nowise affects the promise to pay but gives a further remedy for failure to carry out that promise. A holder of a note may discard the mortgage entirely and sue on his note. (Sturgis Nat. Bank v. Harris Trust and Savings Bank, 351 Ill. 465; Page v. Ford, 65 Ore. 450; Thorpe v. Mindeman, 123 Wis. 149.) It follows that if there be read into the bonds in this case the no-action provisions of the trust deed it must be by an appropriate reference found in the ' bond. The mere statement that the trust deed and bond are to be considered as parts of one and the same contract states merely the fact, commonly known, that a bond, and the mortgage or trust deed securing it, are parts of the same transaction. The rule which plaintiff in error would invoke as to the necessity for reading all terms of one contract into another made at the same time and as a part of the same transaction does not apply to cases of this kind. Sturgis Nat. Bank v. Harris Trust and Savings Bank, supra, and cases there cited.

“This case resolves itself into the question whether there is in. the bond language which may reasonably be said to incorporate therein, by reference, the no-action clause of the trust deed. The only provision of the bond, other than the one just discussed, from which it might be argued that such inclusion by reference results, is as follows: ‘For a description of the mortgaged property and the nature and extent of the seen-' rity reference is made to said trust deed, to all of the provisions of which this bond and each coupon hereto attached are subject, to the same effect as if said trust deed were herein fully set forth.’ This language is applicable only to the description of the mortgaged property and the nature and extent of the security. A purchaser of the bond has his attention drawn to the trust deed for the provisions, in detail, concerning those matters. True, if he would seek to enforce the trust deed he is bound to follow and is limited by its provisions, but it does not follow that when he waives the security and sues by virtue of his common law right there is notice to him that his bond, by reference to the trust deed or otherwise, denies him that right. The language here quoted refers to. the rights conferred upon the bondholders in case they look to the security for the payment of the bonds. The language is so phrased and arranged as to strongly indicate, that the obligor was speaking solely of the security. The purchaser of these bonds would not be impressed with any other thought. It would not occur to him, from this language, that in case the bonds were defaulted on maturity, as is true here, he might be unable to collect because of some provision in the trust deed limiting his power to sue at law. Enforcement against the security and a suit at law are matters of radically different import, and to destroy the right to sue at law, a provision of such character in the trust deed must be included in the bond, expressly or by clear reference thereto. Sturgis Nat. Bank v. Harris Trust and Savings Bank, supra; Enoch v. Brandon, 249 N. Y. 213,164 N. E. 45.”

The bond in question does not provide that the plaintiff cannot maintain an action on the bond secured by the trust deed. The promise to pay is distinct from the pledge of the real estate as a further security for the amount due under the terms of the bond. The plaintiff as a holder may disregard the security of the trust deed and maintain an action on the bond. Oswianza v. Wengler & Mandell, supra. If a judgment be entered in the municipal court for the plaintiff in that action, the bond will be merged in the judgment and will be subject to the lien of the trust deed securing all of the bonds. This judgment will be subordinate to the lien, and does not create a preference that will inure to the plaintiff in her action over the other bonds secured by the trust deed. The contract providing for the bond and trust deed executed by the maker is the contract that is to be considered by this court, and it is not for this court by construction to add or subtract from the written document in order to prevent the plaintiff from maintaining her action on the bond in question. There is nothing in the bond which would indicate that such action is prohibited.

The Supreme Court in the case of Oswiansa v. Wengler & Mandell, 358 Ill. 302, above cited, is conclusive upon this very question. The fact that a judgment is entered will not as a general rule change the form of the debt so as to satisfy a mortgage given to secure it, unless it is intended to so operate. The Supreme Court in Flower v. Elwood, 66 Ill. 438, upon this question said:

“As a general rule, the mere change in the form of the debt does not satisfy a mortgage given to secure it, unless it is intended to so operate. The lien of the debt attaches to the mortgaged property, and the lien can, as between the parties, only be destroyed by the payment or discharge of the debt, or by a release of the mortgage. Mere change of the form of the evidence of the debt in nowise affects the lien. A renewal of the note, its reduction to a judgment, or other change, not intended to operate as a discharge of the lien, still leaves it, as between the parties, in full vigor. This is a rule in equity that is sanctioned by many adjudged cases. In that forum, mere form is disregarded, and the substance only is considered. The cases of Hamilton v. Quimby, 46 Ill. 91, Wayman v. Cochrane, 35 Ill. 155, Elliott v. Blair, 47 Ill. 343; and Rogers v. Trustees of Schools, 46 Ill. 428, illustrate the rule."

In the case of Darst v. Bates, 95 Ill. 493, the Supreme Court upon this question said the following-:

“Where a mortgage is given to secure the payment of a debt, and the debt becomes merged in a judgment, the mortgage stands as security for the judgment. Wayman et ux. v. Cochrane, 35 Ill. 152. See also Rogers v. Trustees, etc., 46 Ill. 428; Hamilton v. Quimby et al., id. 90; Flower v. Elwood, 66 id. 438; Worcester National Bank v. Cheeney, 87 id. 602.”

For the reasons stated in this opinion the court erred in entering* a decree g-ranting- a permanent injunction restraining* the plaintiff from maintaining her suit. The decree is accordingly reversed.

Decree reversed.

Hall, P. J., and Denis E. Sullivan, J., concur.


text:
    Tillie Buhai et al., Complainants, v. The West Side Trust and Savings Bank of Chicago et al., Defendants. Edward Morris et al., Appellants, v. Edward Berkson, Appellee.
    Gen. No. 38,023.
    Opinion filed December 27, 1935.
    Rehearing denied January 7, 1936.
    John M. Lee, of Chicago, for appellants; Thomas J. Carroll, of Chicago, of counsel.
    Edward Berkson, of Chicago, pro se.

    H. J. Rosenberg, of Chicago, for appellee.
   Mr. Justice Hebel

delivered the opinion of the court.

This is an appeal by the respondents named in the petition filed by the receiver from an order entered in the circuit court of Cook county on December 5, 1934. This order recites that upon the motion of the receiver the court granted leave to the receiver to compromise and cancel a note signed by Nate Frazen and Bessie Frazen for the principal sum of $15,000 and secured by a trust deed executed by them conveying the real estate therein described to the West Side Trust and Savings Bank, as trustee, and accept in lieu thereof certain bonds of the Home Owners ’ Loan Corporation, accrued interest and cash in the aggregate sum of $10,564.

The respondents, who appeared by their counsel, objected generally to the entry of this order. In the instant case the receiver was appointed by the court in a cause then pending wherein the complainants instituted suit against the West Side Trust & Savings Bank of Chicágo and the named directors for an accounting for the loan of moneys wrongfully invested and for profits made by the use of the trust fund conveyed to the bank by Samuel Weiss, now deceased, under the terms of a trust agreement wherein the complainants were named as beneficiaries. To this action there were also named as defendants the auditor of public accounts of the State of Illinois and the receiver named for the bank and in possession of the bank’s assets, which bank has since failed and closed its doors.

Among other charges in the bill of complaint it appears that some of the funds were invested in a mortgage note of $15,000, executed by Nate Frazen and Bessie Frazen, secured by a trust deed to the West Side Trust & Savings Bank, as trustee, upon the premises located at 7953 Essex avenue, Chicago, Illinois; that said investment was improper, among other reasons, because at the time of the purchase of said mortgage note, said premises at 7953 Essex avenue, Chicago, Illinois, were not worth in excess of $12,500, and that no reservations had been made for the payment of the general taxes for the years 1929 and 1930. The bill further charges that the directors of the bank had knowledge of and acquiesced in the purchase of the real estate bonds and mortgage for said trust estate and had knowledge that the purpose of the trustee in purchasing the bonds and mortgages for said trust estate, was the g’ain and profit said bank would derive.

In the original proceeding, on motion of the complainants, the court directed that the receiver of the bank deliver to the receiver in this proceeding the bonds, cash and assets in said trust estate, and authorize this receiver to collect interest on all the bonds and mortgages, and to grant extensions of said mortgages and bonds as he deemed advisable.

Thereafter on December 4, 1934, this receiver filed his petition under oath, in which he states in substance that he holds as assets of the estate a certain mortgage in the amount of $15,000 and interest note in the sum of $450, executed by Nate and Bessie Frazen, and which became due on June 15, 1933; that the notes were secured by trust deed; that the general taxes on said property for the years 1930, 1931, 1932 and 1933 amount to approximately $1,601.70; that there is an instalment of special assessment in the amount of $102.70, all due and unpaid; that the owners of the property, Nate and Bessie Frazen have applied to the Home Owners’ Loan Corporation for a loan to refinance their indebtedness; that the corporation would make a loan in the sum of $12,475; that the owners have executed their mortgage note and mortgage to said corporation for $12,462, and that there is available $10,564 to refund the mortgage held by the trustee as assets of said trust estate, and that in the opinion of the petitioner it would be to the best interest of all parties to receive $10,564 in bonds in exchange for said mortgage. The respondents, the former directors of the West Side Trust & Savings Bank, objected to the entry of the order. However, they did not file an answer or offer any evidence upon the question involved. They admit that the court had jurisdiction to advise receivers appointed by the court in receivership administration and was vested with power to authorize this receiver to compromise claims, but contend that there was no showing which would warrant the court in directing by its order that the receiver compromise the amount involved by accepting an amount to be paid by the Home Owners’ Loan Corporation which would result in $5,000 loss.

From this record it appears that the note signed by the Frazens and secured by a trust deed to the bank conveying title to the real estate to secure the payment of this note is only of the value of $12,500; that the note itself had matured, and that there were unpaid taxes for several preceding years.

The mortgagors themselves being in distress, applied for a loan under the terms of the Home Owners’ Loan Corporation Act of 1933.

The respondents ’ contention is that the court did not hear evidence before allowing the order to be entered in this case, and therefore erred. The facts as far as they appear from this record are not contradicted and the court takes judicial notice of the verified bill filed in this case, and from the facts stated the order entered was warranted. Bailey v. Kerr, 180 Ill. 412.

This court will indulge in the presumption that where nothing* appears in the proceedings as to whetlier proof was heard or not, the trial court considered proof necessary to sustain the order. The respondents contend, however, that notwithstanding the presumption, such presumption does not prevail when the order itself indicates the court considered only the verified petition and arguments of counsel. The court was fully justified when it considered not alone the receivership petition under oath, but also the verified bill of complaint and the rights of the several parties, and then entered the order in question.

These respondents did not by their objection specify . to the court any grounds upon which they relied, and ■ it is apparent from this record that the respondents for the first time pointed out the several grounds upon which they believed the court erred. This cannot be done. Unless objection is made specific enough to advise the court, it cannot be raised here in this court for the first time. The order appealed from is affirmed.

Order affirmed.

Hall, P. J., and Denis E. Sullivan, J., concur.


author: Mr. Justice Denis E. Sullivan

text:
    Edward H. Martin, as Administrator of the Estate of Anton H. Luckenbach, Deceased. Appeal of James F. Hutchison et al., Appellants, v. Bankers Life Company, Appellee.
    Gen. No. 38,019.

      Opinion filed December 27, 1935.
    Ossian Cameron and Edward H. S. Martin, of Chicago, for appellants.
    Winston, Strawn & Shaw, of Chicago, for appellee; John D. Black, Walter H. Jacobs and Grier D. Patterson, all of Chicago, of counsel.
   Mr. Justice Denis E. Sullivan

delivered the opinion of the court.

This is an appeal by a number of plaintiffs from judgments of the superior court sustaining demurrers of the defendant to the declarations of the said various plaintiffs. The latter electing to stand on their said declarations the said suits were dismissed at plaintiffs ’ costs, from which said orders and judgments this appeal is taken.

The plaintiffs filed their various declarations alleging anticipatory breaches of certain contracts of insurance by the Bankers Life Company of Iowa, a life insurance company. To these declarations general and special demurrers were filed in the court below and upon argument the same were sustained, from which an appeal was taken to the Supreme Court on the ground that a constitutional question was involved; that the policies issued by defendant were in violation of the provisions of the Constitution of the United States as well as the Constitutions of Iowa and Illinois. The 17 cases were consolidated for the purposes of appeal. The appeal to the Supreme Court was disposed of by the decision in Martin v. Bankers Life Co., 358 Ill. 388, and the causes transferred to this court.

The record in this case discloses not one cause of action, but 17 different causes of action by 17 different persons in which the allegations of facts and the claimed application of law in the various declarations are different. An attempt was made to consolidate all of these cases by an order entered in the court below, thereby making it very difficult for a reviewing court to correctly assemble the facts and equally difficult to write one opinion disposing of the entire number of cases.

Each of the plaintiffs alleges that he was the holder of a certificate of membership in the Bankers Life Company, which agreed to pay on the death of the plaintiff to the beneficiary the principal sum of money mentioned in the certificate. The declaration further shows that the application for the said certificate, or certificate of membership together with the articles of incorporation and the by-laws of the association, shall form the contract between the applicant and the association. The articles of incorporation and the by-laws are pleaded in each case.

It further appears from the declarations, so far as we can find in the abstract, that before the beginning of the suit the defendant, the Bankers Life Company, made increased assessments against the plaintiffs and notified plaintiffs to pay these increased assessments in order to maintain their memberships in force. The various declarations contain different allegations as to what was done by the respective plaintiffs after this alleged wrongful assessment was made, some paying under protest; some tendering the amount originally specified in the policies and one of them, Hutchison, doing neither. Each declaration alleges that by reason of the wrongful assessment, the defendant has breached its contract with the plaintiff and therefore, entitled to recover damages.

It appears that the defendant in this case by its articles of incorporation was constituted as a body corporate for benevolent purposes, pursuant to the statute of Iowa in such case made and provided. Article II of said Articles of Incorporation provides: “The creation of a fund by making mutual pledges and giving valid obligations of the members to each other for their own insurance from loss by death, etc. ’ ’

It further appears that the defendant desired to change from a mutual assessment company into that of a level premium or old line company. After this was done the right to make this change was challenged by holders of certain life insurance contracts. Wall v. Bankers Life Co. of Des Moines, 208 Iowa 1053, 223 N. W. 257, which was a suit in equity, filed against that company, asking that the defendant company be enjoined from making assessments alleged to be in violation of its contracts, and second, required to make a full and complete account of its funds accumulated for the use and benefit of the plaintiffs. The District Court in which the suit was brought denied the injunction and the accounting, and the Supreme Court of Iowa affirmed this action and in its opinion reviewed the right of the company under the law to change its character and make use of its funds for the purposes and in the manner in which the plaintiffs in the cases at bar complain. On page 261, the court in the Wall case said:

“Legislative enactments previously quoted intervened for the benefit of appellee in the case at bar, for by such enabling acts it was authorized to transform itself from an assessment company into that of a legal reserve or level premium entity. Previous to this legislation, appellee was prohibited by statute from being anything but an assessment corporation.” We are inclined to believe that the decision in this case would be controlling in the matter of these contracts. The contracts were executed in the State of Iowa and the decision of the Supreme Court of Iowa as to what the law of that State is in relation thereto, would be controlling as to all similar contracts.

We think the law relating to anticipatory breaches of contracts is quite well settled as set forth in Lake Shore & Michigan Southern Ry. Co. v. Richards, 152 Ill. 59, wherein the court at page 80 says:

• “It is well settled that where one party repudiates the contract and refuses longer to be bound by it, the injured party has an election to pursue either of three remedies: He may treat the contract as rescinded, and recover upon quantum meruit so far as he has performed ; or he may keep the contract alive for the benefit of both parties, being at all times himself ready and able to perform, and at the end of the time specified in the contract for performance, sue and recover, under the contract; or he may treat the repudiation as putting an end to the contract for all purposes of performance, and sue for the profits he would have realized if he had not been prevented from performing. In the latter case the contract would be continued in force for that purpose. Where, however, the injured party elects to keep the contract in force for the purpose of recovering future profits, treating the contract as repudiated by the other party, in order to such recovery the plaintiff must allege and prove performance upon his part, or a legal excuse for non-performance. As said by Lord Coleridge in Freeth, et al. v. Burr, (L. R.) 9 C. P. 208: ‘In cases of this sort, where the question is whether the one party is set free by the action of the other, the real matter for consideration is, whether the acts or conduct of the one do or do not amount to an intimation of an intention to abandon and altogether refuse performance of the contract.’ His lordship then adds: ‘I say this in order to explain the ground upon which I think the decisions in these cases must rest. There has been some conflict among them. But I think it may be taken that the fair result of them is as I have stated, viz., that the true question is, whether the acts and conduct of the party evince an intention no longer to be bound by the contract.’ ”

As was said in a well considered case, viz., Indiana Life Endowment Co. v. Carnithan, 62 Ind. App. 567, 109 N. E. 851, 854:

“The authorities also emphasize the fact that one party to such a contract may not by himself rescind it, and that a repudiation by him alone, although absolute and sufficient to justify the other party in treating it as an anticipatory breach, does not necessitate such action by the latter party, but the latter party may elect to stand upon his contract and perform, or offer to perform, all the conditions thereof required of him, • and then when the day of performance arrives, proceed to enforce his contract. It seems that in cases like the one under consideration, where an insurer repudiates its contract and denies liability thereunder, and refuses to receive premiums, the policy holder may pursue either of three courses, viz.:

“ ‘First, he may elect to consider the policy at an end and recover the equitable and just value of the policy; second, he may institute proceedings to have the policy adjudged to be in force in which case the question of forfeiture may be determined; third, he may tender the premiums, and, if acceptance is refused, wait until the policy by its terms become payable, and then test the forfeiture in a proper action on the policy.’ Day v. Connecticut, etc. Ins. Co., 45 Conn. 480, 29 Am. Rep. 693; Metropolitan L. Ins. Co. v. McCormick, 19 Ind. App. 49, 56, 49 N. E. 44, 65 Am. St. Rep. 392, and cases cited.

“In such cases, however, the policy holder may not treat his policy as in force and effect and still preserve his right to sue for damages for its breach. Upon this subject the Supreme Court of the United States, in the case of Boehm v. Horst, supra, 178 U. S. 13, 20 Sup. Ct. 785, 44 L. Ed. 958, quotes with approval the following language of Lord Justice Bowen:

“ ‘We have therefore to consider upon what principles and under what circumstances it must be held that a promisee who finds himself confronted with a declaration of intention by the promisor not to carry out the contract when the time for performance arrives may treat the contract as broken, and sue for the breach thereof. It would seem on principle that the declaration of such intention by the promisor is not in itself, unless acted on by the promisee, a breach of the contract, and that it only becomes a breach when it is converted by force of what follows it into a wrongful renunciation of the contract. Its real operation appears to be to give the promisee the right of electing either to treat the declaration as brutum fulmén (a harmless thunderbolt — a noisy, but ineffectual, menace), and, holding fast to the contract, to wait till the time for its performance has arrived, or to act upon it and treat it as a final assertion by the promisor that he is no longer bound by the contract, and a wrongful renunciation of the contractual relation into which he has entered. But such declaration only becomes a wrongful act if the promisee elects to treat it as such. If he does so elect it becomes a breach of the contract and he can recover upon it as such.’ ”

In some of the declarations that were filed in these cases it appears that the plaintiffs have taken different positions. They allege that they have either paid the premiums without knowledge of the facts, or have tendered the premium in the original amount and the same has been refused. In either event they have elected to keep the policies in force.

It does not appear from the allegations in the declarations that the increase in premium rate would be destructive of the entire contract.

In Barker & Stewart Lumber Co. v. Edward Hines Lumber Co., 137 Fed. 300, at p. 309, the court says:

“(4) If the renunciation of part performance does not go to the whole consideration (full performance not being rendered impossible), and the renunciation was not intended to excuse performance of other provisions, and does not render unattainable the main object of the contract, no breach occurs, and no right of action arises.” Selby v. Hutchinson, 9 Ill. 319; Weintz v. Hafner, 78 Ill. 27.

The notice by the insurance company to the plaintiffs that unless they paid the increased premiums the policies would cease to be in full force and effect within a stated time in the future was, as said by the United States Supreme Court in the case of Roehm v. Horst, 178 U. S. 1, at page 13: “But such declaration only becomes a wrongful act if the promisee elects to treat it as such. ’ ’

In some of the declarations filed in these cases they set forth that they have elected to treat the statements of the insurance company as a final cancellation of the contract of insurance except in the declarations of James F. Hutchison, which charges the . actions of the defendant company in violation of the Constitution of the United States and of Iowa and Illinois. This contention was disposed of by the Supreme Court as heretofore stated in the case of Martin v. Bankers Life Co., 358 Ill. 388. In the instant cases, the time for performance of the contract by the defendant is not until after the death of the insured providing the contract is kept in full force and effect in accordance with its terms by the payment of the premiums. If, however, as they have alleged here, the defendant wrongfully breaches the contracts and does not intend to carry them out, then the plaintiffs do not have to wait until the death occurs, but may notify the defendant of their election to rescind the contract. They may anticipate the date fixed by the contract for performance according to its terms and commence suit immediately to recover their damages, if any.

As heretofore shown in the Lake Shore & Michigan Southern Ry. Co. case and cases therein cited, if plaintiff wishes to commence suit, he must exercise his election to end the contract and so notify the defendant. He cannot treat it as a broken contract and sue on it as such and, at the same time, elect to keep it in force by a payment of the premiums under protest. If he elects to keep it in force, he must wait until the death of the insured, as provided in the policy, and then bring his suit at that time for the entire damages. Supreme Council A. L. H. v. Lippincott, 134 Fed. 824. From the declarations before us, however, plaintiffs have not elected to recognize the breaches which they allege and rescind the contracts which action is a condition precedent to commencing the suit.

Nowhere in these various declarations do we find what is the item or measure of damages which the plaintiffs have sustained. The declarations do not set forth with sufficient particularity the elements of damage claimed by reason of defendant's alleged breach of the various contracts. The defendant is entitled to know by the pleadings the items which compose the entire sum claimed. Assuming for the moment that the defendant, by its officers, has mismanaged the internal affairs of the company, as alleged in the declaration, and depleted the fund of the company, does it follow that the plaintiffs, as the insured, would be entitled to individual damages for their action? Of what does their damage consist? The declarations state a premise, but there does not seem to be any logical deduction or conclusion drawn therefrom when it comes to alleging the measure of damages and the items that compose it.

We are of the opinion that the declarations are uncertain as to what the damages consist of and are also demurrable because they do not state that they rescind the contract after its breach by the other party and elect to collect their immediate damages. For the reasons herein set forth we think the court properly sustained the demurrers to the declarations and that the plaintiffs electing to stand by said declarations, it was proper to dismiss the same with costs against the plaintiffs. It is, therefore, ordered that the judgment and order of the superior court be and they are hereby affirmed.

Judgment and order affirmed.

Hall, P. J., and Hebel, J., concur.


text:
    Jacob Oswald, Appellee, v. Grand Trunk Western Railway Company, Appellant. Elizabeth Oswald, Appellee, v. Grand Trunk Western Railway Company, Appellant.
    Gen. No. 38,054.

      Opinion filed December 27, 1935.
    Rehearing denied January 7, 1936.
    Winston, Strawn & Shaw, of Chicago, for appellant ; Edward W. Everett and Raymond O. Mitchell, both of Chicago, of conns el.
    Royal W. Irwin, of Chicago, for appellees.
   Mr. Justice Denis E. Sullivan

delivered the opinion of the court.

This is an appeal from the circuit court of Cook county by the defendant, Grand Trunk Western Railway, asking that the two judgments rendered against it, one for $3,000 in favor of Jacob Oswald and the other for $1,000 in favor of Elizabeth Oswald, be reversed.

The accident out of which these causes of action grew occurred on the 21st day of December, 1926, at a point where Western avenue intersects the Grand Trunk tracks. The two plaintiffs, husband and wife, were in an automobile, driving south on Western avenue between five and six o’clock in the evening and when crossing the tracks of the Grand Trunk Eailway Company they were struck by a passenger train coming from the east and sustained the injuries resulting therefrom.

The usual questions of care and negligence are present in this case. It was dark and snowing at the time of the accident. A street car going south on Western avenue was being followed by the two plaintiffs in their automobile. After the street car stopped to discharge passengers, the plaintiffs turned out to the right of the street car and passed it and proceeded on their way across the track. As they approached the track they saw the train for the first time, too late to avoid the collision. Both plaintiffs stated that they were familiar with the crossing, having passed over it upwards of 50 times and that the' defendant always had a flagman at the crossing and that they always relied upon him to direct them across the crossing; that this night they looked for the flagman and seeing none there, they thought that it was safe for them to cross. It is further claimed by plaintiffs that as they got upon the track they saw the flagman running toward his shanty, to get his lantern.

The claim on behalf of the defendant is that the engineer blew the whistle as he approached the crossing and there was a continuous ringing of the bell; that the brilliant headlight on the engine threw a light for a great distance; that the railway track was straight and the train could have been seen if the plaintiffs looked in that direction, and, consequently, the accident was the result of contributory negligence on the part of the plaintiffs.

The first point raised by the defendant is that the plaintiffs were not justified in depending solely upon the flagman to give a warning and were not excused from using their senses of sight and hearing for their own safety.

In Greenwald v. Baltimore Ohio R. Co., 332 Ill. 627, at page 631, the court said:

“The rule has long been settled in this State that it is the duty of persons about to cross a railroad track to look about them and see if there is danger, and not to go recklessly upon the track but to take proper precaution to avoid accident. It is generally recognized that railroad crossings are dangerous places, and one crossing the same must approach the track with the amount of care commensurate with the known danger, and when a traveler on a public highway fails to use ordinary precaution while driving over a railroad crossing, the general knowledge and experience of mankind condemns such conduct as negligence. ’ And further on in the same case the court continuing, said: “One who has an unobstructed view of an approaching train is not justified in closing his eyes or failing to look, or in crossing a railroad track in reliance upon the assumption that a bell will be rung or a whistle sounded. No one can assume that there will not be a violation of the law or negligence of others and then offer such assumption as an excuse for failure to exercise care. The law will not tolerate the absurdity of allowing a person to testify that he looked but did not see the train when the view was not obstructed, and where, if he had properly exercised his sight, he must have seen it.” (Italics ours.)

In this case the plaintiffs both testified that the street car obstructed their view so that they could not see the approaching train. The question of due care on the part of the plaintiff is a question for the jury when there is any evidence of the same given on the trial from which any legitimate inference may be legally and justifiably drawn.

The second point made by the defendant is that the verdict should have been directed for the defendant as to both plaintiffs because both plaintiffs testified that they relied entirely on the flagman’s warning.

The plaintiff Elizabeth Oswald testified that she had been accustomed to seeing a flagman at this crossing if a train was coming and that on the occasion in question she looked straight ahead in an endeavor to locate the flagman and was watching for signals; that after the street car’s first stop it moved up and they also went ahead. Plaintiff testified that she did not hear or see the train until they passed the street car and were on the track.

It is next contended that it was the duty of the plaintiff Elizabeth Oswald to notify the driver of the car of the approaching train when she did see it. The uncontested evidence in the record is that upon her seeing the train, she fainted. The state of being unconscious would naturally relieve her from the performance of any duty which the law would otherwise place upon her.

The plaintiff Jacob Oswald testified that he relied on the flagman at the crossing; that when he was back of the street car he looked and listened, but neither heard nor saw any train; that when he passed the street car his automobile was right on the rails when he stopped; that he saw the flagman run out in the street; that he tried to stop as quickly as he could, but the front wheels of his automobile were just about in the north rail.

In the Greenwald case, supra, the court further said: “The question of due care on the part of a plaintiff is a question for the jury when there is any evidence given on the trial which, with any legitimate inference that may be legally and justifiably drawn therefrom, tends to show the use of due care.”

The testimony of the plaintiffs tends to show that they relied upon the fact that it had been customary for the defendant to protect persons crossing over the railroad by having a flagman at the crossing whenever a train was approaching and that they were induced to cross upon said tracks because of the fact that the flagman was not present.

As the Supreme Court said in Chicago & E. I. R. Co. v. Schmitz, 211 Ill. 446, at page 451:

“The fact, that the gates on the west side of the Western Indiana tracks were raised after the passage of the freight train to the south, operated as an invitation to her to proceed west. Whether she was justified in doing so, and whether she took proper pains to look north and south to see if any train was coming, were questions of fact to be submitted to the jury.”

There are many cases throughout the courts of the country wherein the question as to whether some failure on the part of the railway company to furnish a warning of an approaching train, either by bell, gates or flagman which at other times had usually been employed, relieves the traveler on the road of the same degree of care for his safety as would otherwise be required. These cases proceed on the theory that a traveler has a right to expect and be guided by the warning usually employed at the crossing and that, although the warning was intended as a notice to the traveler, the absence of the warning justified the traveler if he relaxed his usual caution, some of the cases going to the extent of saying that it is an invitation extended to the traveler to cross the tracks with an implied assurance that no train is approaching, which he may to some extent rely upon and lessening the otherwise imperative duty of the traveler to stop, look and listen. Wabash Ry. Co. v. Walczak, 49 F. (2d) 763; Birmingham So. Ry. Co. v. Harrison, 203 Ala. 284, 82 So. 534; Welch v. Baltimore & Ohio R. Co., 7 Pen. (Del.) 140, 76 Atl. 50; Brender v. New York, O. & W. Ry. Co., 177 F. Y. S. 469. One who knows that a flagman is employed by a railroad company at a certain crossing may presume that he will be at his post and warn him of the approach of trains, and is justified in proceeding to cross the track in the absence of the watchman, although his view in one direction is partially obstructed. Chicago & A. B. Co. v. Blaul, 175 Ill. 183; Chicago, St. Louis & Pittsburg Railroad Co. v. Hutchinson, 120 Ill. 587; Wabash Ry. Co. v. Walczak, 49 F. (2d) 763; Teague v. St. Louis Southwestern Ry. Co., 36 F. (2d) 217.

It is next contended that the court committed error in refusing to give an instruction based on what is known as the “proposition for an instruction,” which reads as follows:

“The plaintiffs, Jacob Oswald and Elizabeth Oswald, as a matter of law, were not justified in relying upon the presumption that a flagman would be at the crossing to give a warning. For were they justified in relying upon the presumption that a bell would be rung or a whistle sounded.”

This abstract proposition of law would not be of assistance in determining whether or not either party was guilty of negligence. We think that the instructions given by the court presented the rights of both parties under the law and it was not error to refuse' this proposition. Other propositions of instructions submitted to the court were rightfully refused.

In the instant case where evidence was introduced tending to show that the flagman was seen running to his shanty to obtain his lantern to flag the approaching automobile, and that he did so too late, that fact at least left the question of any contributory negligence on the part of the plaintiffs as a question of fact to be determined by the jury.

The next contention of the defendant is that the court erred in the consolidation of the causes. The new Practice Act, section 23, provides that:

“Subject to rules, all persons may join in one action as plaintiffs, in whom any right to relief in respect of or arising out of the same transaction or series of transactions is alleged to exist, whether jointly, severally or in the alternative, where if such persons had brought separate actions any common question of law or fact would arise: Provided, that if upon the application of any party it shall appear that such joinder may embarrass or delay the trial of the action, the court may order separate trials or make such order as may be expedient, . . .” Ill. State Bar Stats. 1935, ch. 110, If 151.

Section 44 of the Civil Practice Act provides in part:

“ (1) Subject to rules any plaintiff or plaintiffs may join any causes of action, whether legal or equitable or both, against any defendant or defendants; . . .” Ill. State Bar Stats. 1935, ch. 110, H 172.

■ Section 51 of the Civil Practice Act provides in part:

“An action may be severed, and actions pending in the same court may be consolidated, as an aid' to convenience, whenever it can be done without prejudice to a substantial right.” Ill. State Bar Stats. 1935, ch. 110, If 179.

Apparently it was the intention of the legislature to permit the court in its discretion to consolidate causes of action for the hearing in order to save time and expense. In the instant case the evidentiary facts were substantially the same as to both plaintiffs, and whilst there may be a difference as to the rule relating to contributory negligence of plaintiffs and their various legal duties at the time and preceding the accident, they could have been and were taken care of by the court’s instructions. We are of the opinion that the court, acting under the discretionary power given to it by statute, was not wrong in ordering both cases tried together. We cannot see how defendant’s rights were prejudiced and no resulting damage has been pointed out.

It is contended by defendant that error was committed by the trial judge in his rulings upon the admissibility of the evidence and also that his conduct toward the defendant was prejudicial. We gather from this record that both counsel were quite earnest in presenting their conflicting views as to the law and evidence. The trial judg*e was apparently attempting to conduct, the hearing without error and we do not think that the rights of the defendant were prejudiced in any way by his rulings in so far as this record discloses.

Defendant further contends that the court erred in giving certain instructions to the jury. We have examined the instructions and we believe that the jury was fairly instructed on all phases of the law applicable to the facts and that no error was committed in this regard.

It is finally contended that the verdicts are contrary to the law and evidence and that the court erred in not granting a new trial. In a case of this kind where there is conflicting evidence as to the material facts, a jury having seen the witnesses and heard them testify are well fitted to pass upon the facts. Time and again have the courts of last resort denied the right of judges to weigh the evidence and set aside verdicts because they might, if sitting as jurors, arrive at a different conclusion. As stated by our own Supreme Court in the case of People v. Hanisch, 361 Ill. 465, 468: “Whatever may be the rule in certain other jurisdictions, we firmly adhere to our often-asserted belief that it is the province of the jury, alone, to determine the weight of the evidence and the credibility of witnesses. If it were not so there would be little use for the jury system. The jury, as a fact-finding body, is of such importance that' an abridgment of its functions in this regard and an appropriation of them by the judges would mean the forsaking of a valued tradition in our system of jurisprudence. The utmost caution should be exercised not only by the trial courts but by the reviewing courts to uphold the sanctity of the trial by jury.”

We are of the opinion that we would not be justified in disturbing the judgments for any errors that have been called to our attention. Therefore, for the reasons stated in this opinion, the judgment of the circuit court ■ is hereby affirmed.

Judgment affirmed.

Hall, P. J., and Hebel, J., concur.


text:
    In re Estate of Elvira J. Parks, Deceased. M. J. Pufahl, as Receiver of the Austin National Bank of Chicago, Appellant, v. Estate of Elvira J. Parks, Deceased, Appellee.
    Gen. No. 38,123.

      Opinion filed December 27, 1935.
    Glenn, Schwartz, Real & Browning, of Chicago, for appellant; Harold E. Baily, of Chicago, of counsel.
    Castle, Williams & McCarthy, of Chicago, for appellee; Franz W. Castle and Joseph J. Witry, of Chicago, of counsel.
   Mr. Justice Denis E. Sullivan

delivered the opinion of the court.

This is an appeal from a judgment entered in the circuit court of Cook county, denying the claim of M. J. Pufahl, as receiver of the Austin National Bank of Chicago, against Philip W. Huston also called Houston, and Frank M. Pray, as executors of the estate of Elvira J. Parks, deceased.

The cause of action arose out of an assessment by the comptroller of currency of the United States against all shareholders of the Austin National Bank of Chicago, to enforce the superadded liability of the shareholders, including Philip W. Huston and Frank M. Pray, as executors, who are the owners and holders of 12 shares of the capital stock of the Austin National Bank.

The circuit court found that Philip W. Huston and Frank M. Pray, as executors of the estate of Elvira J. Parks, deceased, were liable to M. J. Pufahl, as receiver, for the sum of $1,200 plus interest, to the extent of the property and funds in their hands as such executors.

The circuit court further found that the claim did not accrue and was not filed in the probate court until after the one-year period for filing claims had expired and that consequently, claimant was barred from sharing in the funds of the estate, except as to uninventoried assets. M. J. Pufahl, as receiver, appealed from the entire judgment.

The theory of M. J. Pufahl, as receiver, is that the liability of the executors of the estate of Elvira J. Parks, deceased, for the stock assessment levied against them as the owners and holders of 12 shares of stock, arises by virtue of section 5152 of the Revised Statutes of the United States (12 U. S. C. A. Sec. 66) and binds them the same as the deceased would be bound if living, and is not such an ordinary claim as would be barred by chapter 3, section 70, Ill. State Bar Stats. 1935, If 71.

It is further contended by claimant that section 71 of the Administration of Estates Act was not designed to bar a claim arising by virtue of the federal statute which was not absolute and which did not accrue until after the one-year period for filing claims had expired.

Elvira J. Parks, who owned these shares of stock in her lifetime, died March 20, 1928. Philip W. Huston and Frank M. Pray, as executors, are now the owners and holders of the 12 shares of capital stock of the Austin National Bank of Chicago at the par value of $100 each.

On the 30th day of March, 1931, the comptroller of currency of the United States declared and adjudged said Austin National Bank of Chicago to be insolvent and closed said bank. Subsequently, on April 6, 1931, M. J. Pufahl was appointed receiver of said bank by the comptroller of currency of the United States.

May 21, 1931, the comptroller of currency in order to pay the debts of the Austin National Bank of Chicago made an assessment upon all the stockholders of said bank equal to 100 per cent of the par value of the stock of said bank owned by said stockholders, including an assessment of $1,200 against the defendants, Philip W. Huston and Frank M. Pray, as executors of the last will and testament of Elvira J. Parks, and the said comptroller of currency demanded of the said Philip W. Huston and Frank M. Pray the payment of said stock assessment as aforesaid, together with interest at the rate of five per cent per annum from June 29, 1931, and the said executors refused to pay M. J. Pufahl, as receiver, the amount due or any part thereof.

On May 21, 1931, the said comptroller of currency directed M. J. Pufahl, as receiver of the Austin National Bank of Chicago, to take the necessary proceedings to enforce the assessment levied against the" capital stock of said bank.

On May 17, 1928, letters of administration were issued to Philip W. Huston and Frank M. Pray by the probate court, in a proceeding pending therein entitled, “In the matter of the Estate of Elvira J. Parks, deceased.” It was stipulated that an inventory and supplemental inventory were filed in the probate court of Cook county one year from the date of issuance of letters testamentary, and that the said estate is still open and there has been no final distribution.

On September 1, 1933, M. J. Pufahl, as receiver, filed his claim against the estate of Elvira J. Parks in the probate court for the sum of $1,327.17, béing $1,200 assessment plus interest at the rate of five per cent to date of filing said claim.

The only point of controversy involved here is whether the comptroller of the currency by levying the assessment against the stockholders is in any different position than any other creditors filing their claims against the estate.

Chapter 3, section 70 of the Illinois Revised Statutes, 1935, H 71, which is applicable to this question, reads as follows:

“All claims and demands of whatever class not exhibited to the court within one year from the granting of letters as aforesaid shall be forever barred as to property and estate of the deceased which has been inventoried or accounted for by the executor or adminisfrator; ... all claims not exhibited to the court prior to the date so fixed shall be forever barred as to the property and estate listed in such inventory, and the amount remaining due on all claims exhibited to the court on or prior to the day so fixed upon as aforesaid, including* those filed within one year from the granting of letters, shall be paid pro rata out of such subsequently inventoried estate. . . . ”

It is contended by the claimant that the Federal Statute (section 66 of Title 12, United States Code Annotated) creates a special class of claims which is charged as a lien upon the estate of the deceased stockholder, and which is not governed by the laws of Illinois relative to the administration of estates of decedents.

It may well be admitted that the validity of the claim cannot be affected in any way by the laws of the State, but as to the method of its enforcement, it is governed by the practice prescribed by the State laws, the same as any other claimant. We are inclined to believe this exact question was settled by the Supreme Court of the United States on February 4, 1935, in the case of Forrest v. Jack, 294 U. S. 159, on page 163, referring to the said section 66 of Title 12, United States Code Annotated, wherein the court said:

“In the absence of federal enactments relating to procedure for enforcement of the liability imposed by Section 66, collection is to be made in accordance with state laws governing claims against estates of deceased persons, at least to the extent that such laws are not inconsistent with enforcement of the liability imposed by national authority.” And again the court said:

“There is no suggestion that the laws of the State of Utah discriminate against or are inadequate for the just and convenient enforcement of liability imposed. ’ ’

■ In other words, this liability which was created by the comptroller of the currency more than one year after the time when claims could be filed under the law of Illinois is treated the same as any other claim and we think rightfully so. No discrimination is made against it nor can we see any reason why it should be preferred over other claims. No exception in its favor is made in any law and we do not see why we should attempt to make one.

We are of the opinion that the finding of the circuit court is correct and its order and judgment are, therefore, affirmed.

Order and judgment affirmed.

Hall, P. J., and Hebel, J., concur.