author: Mr. Justice Dove

text:
    Pioneer Life Insurance Company, Appellee, v. Alliance Life Insurance Company, Appellant.
    Gen. No. 9,498.
    Heard in this court at the October term, 1939.
    Opinion filed February 17, 1940.
    George Z. Barnes and George W. Hunt, both of Peoria, for appellant.
    Poppenhusen, Johnston, Thompson & Raymond, of Chicago, for appellee; Floyd E. Thompson, of Chicago, and Clarence W. Heyl, of Peoria, of counsel.
   Mr. Justice Dove

delivered the opinion of the court.

This is a suit brought by the Pioneer Life Insurance Company upon an indemnity policy of reinsurance issued by the Peoria Life Insurance Company on July 12,1932, in the amount of $24,000 on the life of Joseph Marzano, which policy, plaintiff alleged, was assumed by the defendant. The answer of the defendant admitted that the Peoria Life Insurance Company executed and delivered the reinsurance indemnity policy on July 12,1932, as alleged, but denied that the defendant ever assumed or agreed to carry out the obligation of the Peoria Life Insurance Company to the plaintiff. A trial before the court without a jury resulted in a finding and judgment in favor of the plaintiff and against the defendant for $28,801.83 and costs of suit and the defendant appeals.

The record discloses that prior to October 16, 1931, the Rock-River Valley Insurance Company was an assessment insurance company organized under the laws of this State with its principal office in Rockford. Subsequently, its name was changed to the Pioneer Life Insurance Company, appellee herein. On October 16, 1931, it entered into an automatic reinsurance agreement with the Peoria Life Insurance Company of Peoria, hereinafter referred to as the Peoria Life, this agreement, in the insurance business, is spoken of as a treaty for reinsurance. In the instant case, appellee by this treaty, among other things, obligated itself that before applying to any other company for reinsurance upon a standard risk, it would first bind the Peoria Life and the Peoria Life agreed to be automatically bound upon all risks accepted at standard rates by appellee as of the date appellee became bound by virtue of its policy. Appellee also obligated itself to maintain with the Peoria Life such reinsurance so long as the original policy should remain in force. While this treaty was in effect and the parties were operating thereunder, appellee issued its policy of insurance on the life of Joseph Marzano, effective March 26, 1932, by which it agreed to pay his beneficiaries the sum of $25,000. The statute under which appellee was organized limited the amount of insurance which it could carry on one risk to $1,000 and the Peoria Life recognized this fact. On April 25, 1932, appellee submitted its special application for reinsurance of this risk, together with the application for insurance of Dr. Mar-zano to appellee, his medical examination and other documents, to the Peoria Life and afterward on July 12, 1932, appellee submitted to it a formal application, all as provided by the treaty for reinsurance of October 16, 1931. This application was for reinsurance to the extent of $24,000 and was duly accepted by the Peoria Life and reinsurance granted effective from March 26, 1932 and subject to all the terms and conditions of the application and the treaty for reinsurance. Appellee paid the Peoria Life the premium due it under this reinsurance agreement for the quarter ending December 25, 1933.

On November 15, 1933, Charles V. O’Hern was appointed receiver of the Peoria Life Insurance Company by the director of insurance and on that day he qualified and a decree was rendered by the circuit court of Peoria county finding the company insolvent and directing its liquidation by the receiver. At that time the obligations of the Peoria Life to appellee were evidenced by numerous reinsurance policies aggregating $90,294, one of which was the one herein referred to reinsuring appellee on its policy issued upon the life of Dr. Marzano. On November 23, 1933, some of the officers of appellee discussed with the receiver of the Peoria Life its reinsurance in that company and were told by the receiver that he could give them no information regarding the status of their reinsurance in the Peoria Life and that they, must decide for themselves what course they should pursue regarding reinsurance of their existing and future business. Thereafter appellee entered into a treaty for reinsurance with the American Central Life Insurance Company of Indianapolis by the provisions of which appellee obligated itself to exclusively reinsure with the American Central Life Insurance Company all of its new business and the American Central Life Insurance Company obligated itself to automatically accept the same and in addition some 88 of the risks formerly reinsured by the Peoria Life were transferred to the American Central Life Insurance Company and accepted by it. This treaty is dated December 11,1933, and reinsurance agreements were executed by the American Central Life Insurance Company in January, 1934, but there is some evidence to the effect that the treaty was actually signed by the parties on February 27, 1934, however, on January 18, 1934, ap-pellee wrote the receiver of the Peoria Life advising him that it had completed a reinsurance contract with the American Central Life Insurance Company to rein-sure the outstanding reinsurance policies as the coverage period expired with the Peoria Life and to cover new business as written. On December 22, 1933, the American Central Life Insurance Company wrote appellee in connection with some phases of this treaty and among other things said: “With reference to the business that you had heretofore placed with the Peoria, we are prepared to assume the coverage with the exception of the risks of Isidor B. Freed and Joseph Marzano. . . . The reinsurance of the old business will be effective as of noon on the day we receive notice from you that this proposal is satisfactory to you.”

On December 21, 1933, Dr. Marzano died and thereafter appellee paid his beneficiaries the face of his policy. On January 23, 1934, proofs of the death of Dr. Marzano were submitted by appellee to the receiver of the Peoria Life and the receiver, on January 30, 1934, acknowledged the receipt thereof and advised appellee that all death claims were being held in abeyance subject to the further order of court. On March 1, 1934, the American Life Insurance Company assumed $4,000 of the policy issued by appellee to the said Isador B. Freed, which had formerly been ceded by it to the Peoria Life and the parties to the treaty between appellee and the American Life Insurance Company thereafter carried out their respective obligations for reinsurance under that treaty.

In the liquidation proceedings of the Peoria Company, the circuit court of Peoria county, on August 22,. 1934, approved the report of the receiver recommending the approval of the proposal of appellant, then known as the Life and Casualty Company of Chicago, for the reinsurance of the business of the Peoria Company. With this decree there was filed the final draft of the contract between appellant and the receiver, which was thereafter executed by the respective parties on October 4, 1934, according to the provisions of this decree and duly approved by the director of insurance and the circuit court. Among other provisions of this contract is the following:

“The Company does hereby reinsure and assume as of November 15, 1933 (subject to the liens, terms, conditions and provisions and only to the extent herein specifically provided), the liability of the Peoria Life under all policies and contracts of insurance, including . . . all reinsurance contracts issued or assumed by the Peoria Life and outstanding and in force on the books and records of the Peoria Life on November 15, 1933, subject, however, to any and all defenses against claims and actions upon said policies or contracts which would have been available to said Peoria Life had this Agreement not been made. . . . The Company may continue, discontinue or replace any reinsurance agreement between the Peoria Life and any other company, but shall not reinsure for its own account any part of the retention of the Peoria Life in any policy on November 15, 1933. Subject to the foregoing, the Company shall have discretionary powers in handling all transactions pertaining to reinsurance ceded by or accepted by the Peoria Life on a basis that is fair and equitable to the policyholders of the Peoria Life. The receiver shall assign to the Company all the right, title and interest of the Peoria Life and of the Receiver in and to all reinsurance agreements between the Peoria Life and other insurance companies, together with all rights and privileges thereunder, including the right of the Receiver to terminate or cancel any such agreement.” This agreement also provided that the receiver should deliver to appellant the assets of the Peoria Company with some exceptions which should constitute the Peoria Life Fund and the receiver was required to mail a copy of this agreement to all persons named as insured in contracts and policies in force with the Peoria Company on November 15, 1933, and provided that former policyholders of the Peoria Company who did not file claims in the receivership proceedings were considered as assenting to the reinsurance agreement and as having assigned to the Peoria Fund all claims against the Peoria Company. After the execution of this contract between the receiver and appellant a copy thereof was sent to appel-lee, together with a certificate of assumption, which recited that appellant thereby assumed and agreed to carry out the obligations of the Peoria Company under its reinsurance agreement with appellee, subject to the terms and conditions named in the policies and treaty agreement and subject to the agreement between the receiver and appellant, provided, “(a) that the policies of reinsurance were in full force and effect on November 15, 1933, as an obligation of Peoria Life Insurance Company under the terms of said policies and said treaty and (b) said policies are an oblig-ation under the terms of said reinsurance agreement.”

It is the contention of appellee that each reinsurance agreement entered into between appellee and the Peoria Company was a separate and distinct contract, that the Marzano contract was in full force and effect on November 15, 1933, as an obligation of the Peoria Life Insurance Company, that this contract was revived and renewed by the decree of the circuit court of August 22,1934, and was assumed by appellant by the reinsurance agreement entered into between it and the receiver on October 4, 1934.

Counsel for appellant concede that the policy of insurance issued by appellee to Dr. Marzano was in effect at the time of his death and that the Peoria Life had received its portion of the premiums prior to November 15, 1933, to continue the reinsurance in effect to and including December 25, 1933, but it is insisted by counsel that the reinsurance treaty between appellee and the Peoria Life and all individual policies, agreements or cessions thereunder form an indivisible contract, that the Peoria Life accepted each risk under the basic treaty of October 16, 1931, that this treaty was exclusive and prohibited appellant from obtaining any other reinsurance with any company other than the Peoria Life, that its reinsurance treaty with the American Central Life Insurance Company precluded, by its terms, a continuance of any further reinsurance relationship with appellant and that by so doing it was impossible for appellee to become an automatic reinsurance treaty holder under the terms of the reinsurance agreement entered into by the receiver of the Peoria Life and appellant. In support of this contention, appellant cites and relies upon Manhattan Life Ins. Co. v. Prussian Life Ins. Co., 296 Fed. 39. In that case it appeared that the Manhattan Life Insurance Company desired to procure reinsurance of a certain portion of its liability under certain policies issued by it and to that end entered into a treaty of reinsurance with the Prussian Life Insurance Company by the provisions of which the Prussian reinsured the amount of certain policies in excess of the maximum limit retained by the Manhattan Company. The agreement became effective on January 15, 1914. On November 14, 1917, the Manhattan served formal notice of cancellation of the treaty as provided in the agreement and obtained other reinsurance not only for new business but also for some of the policies already insured by the Prussian and after the cancellation notice became effective, Manhattan ceased to pay Prussian any renewal premiums on the reinsurance of such of its risks as it had insured elsewhere but continued to tender premiums on such risks as it had not insured in other companies. Thereafter Prussian gave notice to the Manhattan that it terminated its liability under the agreement of 1914 and all certificates of reinsurance heretofore issued by it pursuant thereto. This notice assigned as breaches of the contract the nonpayment of premiums due from the Manhattan and its refusal to permit Prussian to examine its books contrary to the provisions of the treaty of 1914. The Manhattan continued to tender premiums under the policies which it had not reinsured in other companies and Prussian refused to accept the same. While this was going on, a party insured by a policy issued by the Manhattan and reinsured by Prussian and which the Manhattan had not reinsured in a company other than Manhattan died and suit was instituted by Manhattan to recover, among other things, the amount for which Prussian had reinsured the risk which had matured by the death aforesaid. In holding there could be no recovery for this item the circuit court of appeals for the second circuit said: “Reduced to its lowest terms plaintiff’s proposition is this: My contract with Prussian meant that, when I exercised my right of cancellation by giving a month’s notice in writing, I could thereafter leave the Prussian as reinsurer on such then existing risks as I did not care to place elsewhere, but as to any risk on which I preferred other rein-surers, or no reinsurance, I could whenever I pleased cease paying premiums. Colloquially put, this interpretation empowered Manhattan to take at pleasure the cream of its business from Prussian, and leave the latter the skim milk. Technically phrased, Manhattan asserts that, whatever may be said of the agreement to place ‘any excess’ over its own retention limit with Prussian, the agreement section providing that reinsurance ‘in force (at cancellation) shall be carried by the Prussian in accordance with the terms of this agreement, unless terminated or modified by special agreement, ’ embodies a divisible contract, the factors being the several risks; therefore if and when Manhattan committed a breach in respect of one or more risks by failing to pay premiums, Prussian was not thereby released from the obligation of carrying the remaining risks, but was left to such action for damages as it might be able to bring in respect of premiums not paid. However put, we cannot accede to this interpretation; it distinctly lacks morals, and this suit is in equity ; and while equity follows the law, we regard the contract between the parties as legally single. It was, as has been well said, a contract for insurance, not one of insurance, and the insurance which Prussian agreed to furnish was to be in respect of the entire first excess over Manhattan’s retention limit, as specifically set forth in the agreement itself. Whatever was the body of insurance thus furnished and in being, at the moment of cancellation, that whole body of insurance Prussian was to continue to carry until Manhattan’s primary liability was ended, saving special agreements from time to time made. The agreement between the parties referred, not to particular risks, but to the assumption of a corpus of liability; it dealt not in retail, but in gross. . . . Consequently we hold, on the wording of the contract, that Manhattan committed two breaches of the whole agreement: (1) It refused to permit an examination of its books, etc., as to some risks, and some risks are included in the phrase ‘any risks’ used in the fifteenth section; and (2) it deliberately and not by inadvertence refused to pay premiums on numerous risks, which were part of the ‘reinsurance in force’ when cancellation notice given.”

Counsel for appellee insists that the foregoing decision has nothing to do with the issues in this case, that here the Marzano reinsurance was not an automatic cession under the treaty, hut a facultative cession, there being a special application and a special investigation by the Peoria Life and further that the amount of the premium was not affected by a continuance of the treaty relations between the Peoria Life and appel-lee nor was it affected by the number of other contracts of reinsurance applied for by appellee or issued by Peoria Life. Counsel further insist that appellee never refused to pay premiums on reinsurance business which would have been due Peoria Life had it not gone into receivership but that when Peoria Life did go into receivership appellee either had to procure reinsurance or go out of business. Much of this is true and the facts in the instant case are not analogous to the facts in the Manhattan Life Insurance Company case but that case is authority for the proposition that the reinsurance treaty and the various cessions including the Marzano agreement are to be construed together in determining the intention of the parties in order to ascertain their respective rights and liabilities.

In the instant case the treaty, agreements and cessions theretofore executed by appellant and Peoria Life were terminated by the insolvency of the Peoria Life and the liquidation of that company. The evidence discloses that many individual policyholders paid their premiums on their policies to the receiver after November 15,1933, and the receiver retained the same in a separate fund, acting under the directions of the court which was supervising the liquidation of Peoria Life. Appellee never paid any premiums to the receiver but recognized that its treaty with Peoria Life was terminated and reinsured its business with other companies. After the death of Dr. Marzano appellee furnished the receiver of Peoria Life with proofs of his death and was advised by the receiver on January 30, 1934, that all death and disability claims were held in abeyance by the receiver subject to the order of court. Appellee correctly concluded that the original treaty and cessions were terminated and its counsel now say that the fact that it made a new treaty with the American Central Life Insurance Company and agreed to reinsure all of its excess risks with it in no way prevented it from making a similar contract with appellant. Perhaps not, but if it did it would be breaching its agreement with the American Central and the record is clear that appellee never intended at any time to enter into any such agreement with appellant.

If any liability rests upon appellant, it arises by virtue of the reinsurance agreement of October 4, 1934, entered into by the receiver and appellant. Appellee was not a party to that agreement other than in the sense that it was a creditor of the insolvent company and the receiver, in liquidating the assets of the insolvent, was its representative. This reinsurance agreement covers 23 pages of the printed abstract. No good purpose could be served by setting it forth in this opinion. In its preamble it is recited that a large part of the assets of the defunct company is invested in that class of securities which has depreciated greatly with current depressed markets and great loss would accrue to the policyholders of such company, their beneficiaries and their dependents if forced liquidation of all assets were undertaken at that time. We think this reference and other references in this agreement to policyholders meant individual policyholders rather than appellee, an insurance company itself. There is nothing found in this agreement which obligated appellant to pay all of the obligations of the Peoria Life as they existed on November 15, 1933. This contract of reinsurance had to do with assenting individual policyholders and dealt with no other contract or obligation of the insolvent Peoria Life. People ex rel. Palmer v. Peoria Life Insurance Co., 303 Ill. App. 430, in which an opinion is this day filed. While appellant, by this contract, did assume the liability of the Peoria Life under all reinsurance contracts issued by the Peoria Life and in force November 15, 1933, the agreement must be read in its entirety and it expressly conferred upon appellant discretionary powers in handling such contracts on a basis that is fair to the policyholders of the Peoria Life. The agreement further provided that in consideration of this assumption by appellant, the receiver was required to assign to appellant the interest which the Peoria Life had and which the receiver acquired in and to this treaty of October 16, 1931. When this language is considered in the light of how things stood on October 4, 1934, appellant was clearly within its rights when it rejected appellee’s claim under the Marzano cession. So far as the treaty which the receiver had with appellee was concerned, everything therein of benefit to appellant had been acquired by the Central American Insurance Company and all that remained was a liability under the Marzano claim. The Marzano reinsurance cession, although in force on November 15, 1933 was not, in our opinion, revived and renewed by the decree of August 22, 1934 or by the contract which was entered into by appellant and the receiver on October 4, 1934. By its conduct appellee had placed itself in the class of general creditors of the Peoria Life and was not a beneficiary of this reinsurance agreement.

The judgment of the circuit court of Peoria county will therefore be reversed.

Judgment reversed.


source: Caselaw Access Project

author: Justice Wolfe.

license: Public Domain

text:
    In re Estate of Charles W. Smith, Deceased. Harriet E. Levings, Appellee, v. Franc Ingraham, Ad-ministratrix De Bonis Non of Estate of Charles W. Smith, Deceased, Appellant.
    Gen. No. 9,491.
    Heard in this court at October term, 1939;
    opinion filed February 14, 1940.
    Henry C. Warner and Clyde Smith, for appellant;
    B. Jay Knight, J. E. Goembel and Robert L. Bracken, for appellee;
    Frederick H. Haye, of counsel.
   Opinion by Presiding

Justice Wolfe.

“Hot to be published in full.”


text:
    William V. Dufner, Appellant, v. John H. Mathis, Appellee.
    Gen. No. 9,497.

      Heard in this court at October term, 1939;
    opinion filed February 14, 1940.
    H. D. Morgan and L. 0. Eagleton, for appellant;
    Eugene Letter, of counsel;
    Clarence W. Heyl, for appellee.
   Opinion by Presiding

Justice Wolfe.

“Not to be published in full.’’


author: Justice Matohett.

text:
    Irwin H. Keller, Appellee, v. Christopher L. Anton et al., Defendants. Ida Russell Mack, Appellant.
    Gen. No. 41,090.
    opinion filed February 29, 1940
    rehearing denied March 18, 1940.
    Thomas J. McCormick, for appellant;
    Philip H. Salzman, for appellee;
    Jacob G. Grossberg, of counsel.
   Opinion by Presiding

Justice Matohett.

“Not to be published, in full.’’


author: Mr. Presiding Justice Dove

text:
    Ella Lillie, Appellee, v. John McFarlin, Executor of the Last Will and Testament of Luke McFarlin, Deceased, Appellant.
    Gen. No. 9,419.
    Heard in this court at the February term, 1939.
    Opinion filed January 25, 1940.
    Rehearing denied March 19, 1940.
    Arthur G. Waite, for appellant.
    David B. Joslyn, of Woodstock, for appellee.
   Mr. Presiding Justice Dove

delivered the opinion of the court.

On October 31, 1919 Luke McFarlin and Ida Mc-Farlin, husband and wife, were the owners of 80 acres of land in Walworth county, Wisconsin and on that day they executed, in the State of Wisconsin, their note for $14,000 due March 1,1930 and secured its payment by a mortgage upon said land and delivered the same to Ella Lillie, the claimant herein. On February 26, 1921, the McFarlins conveyed the mortgaged premises to Albert Wiedenhoeft and Mary Wiedenhoeft, subject to said mortgage, but the grantees in said conveyance did not assume or agree to pay the indebtedness secured by said mortgage. The holder of the note and mortgage, Ella Lillie, knew of the conveyance and thereafter accepted from the grantees payments on both the principal and interest. After this conveyance the grantors therein, Mr. and Mrs. McFarlin, made no payments to Ella Lillie, the owner and holder of said mortgage. On March 1, 1930, being the date of the maturity of said $14,000 note, the balance due on the principal sum amounted to $13,600 and at that time there was $680 interest due. On May 22, 1930, without the knowledge or consent of the McFarlins, Ella Lillie and the said Albert Wiedenhoeft and Mary Wie-denhoeft executed the following instrument:

1. “Agreement made and entered into this 22nd day of May, 1930, by and between Ella Lillie of the City of Beloit, State of Wisconsin, party of the first part, and Albert Wiedenhoeft and Mary Wieden-hoeft, husband and wife, of the Town of Sharon, Wal-worth County, Wisconsin, parties of the second part,
WITNESSETH :
2. “That the said party of the first part is the legal owner and holder of a certain promissory note made by Luke McFarlin and Ida McFarlin, dated the 31st day of October, 1919, for the sum of Fourteen Thousand Dollars ($14,000.00) payable ten (10) years after March 1st, 1920, to the order of said Ella Lillie, which note was secured by a mortgage made and executed by Luke McFarlin and Ida McFarlin, his wife, to Ella Lillie, dated the 31st day of October, 1919, and recorded in the office of the Register of Deeds in and for Walworth County, Wisconsin, on the 28th day of November, 1919, in Volume 124 of Mortgages on page 99, and which mortgage covered the following described real estate, situated in the County of Walworth and State of Wisconsin, to-wit: ’ ’ (Here follows a description of the eighty acres of land.)
5. “And whereas, there is now due upon said note and mortgage the sum of Thirteen Thousand Six Hundred ($13,600.00) Dollars, of Principal and Six Hundred Eighty ($680.00) Dollars of interest;
6. “And whereas, said parties of the second part do hereby desire to have the payment of the sum of Thirteen Thousand Six .Hundred ($13,600.00) Dollars, principal of said note, extended for five (5) years from the 1st day of March, 1930, in consideration of and in accordance with the agreement hereinafter made on their part ;
7. “And whereas, the parties of the second part have this day paid Three Hundred Dollars ($300.00) of said interest money, leaving due thereon, as of March 1st, 1930, the sum of Three Hundred Eighty ($380.00) Dollars of interest;
8. “Now, therefore, the said party of the first part agrees that in case the said parties of the second part shall pay the said sum of Three Hundred Eighty ($380.00) Dollars of interest which became due on March 1st, 1930, on or before the 1st day of August, 1930, to extend the payment of Thirteen Thousand Six Hundred ($13,600.00) Dollars, principal of said note, for five (5) years from March 1st, 1930, said principal to bear interest at the rate of five (5) per cent per annum, to be payable annually, at the place mentioned in said note; second parties shall keep and perform all and singular the covenants and agreements in said note and mortgage, except as changed by this agreement ;
9. “And the said parties of the second part agree to and accept said extension upon the conditions aforesaid made and agree that in case of default of the interest payment of Three Hundred Eighty ($380.00) Dollars due on or before August 1st, 1930, and in case of the default of any interest payment, or in case of failure to keep and perform any of the covenants and agreements in said note and mortgage contained, this agreement shall become null and void at the option of said party of the first part, and the balance of Thirteen Thousand Six Hundred ($13,600.00) Dollars oh said .note shall become immediately due and payable and may be collected, together with accrued interest at the rate of Five (5) per cent per annum, anything herein-before contained to the contrary notwithstanding.
10. “It is further agreed, that this agreement shall be binding upon and insure to the heirs, executors, administrators and assigns of both parties hereto.
“Witness, the hands and seals of the parties hereto, the day and year first above written.
“In Presence of: Ella Lillie (Seal)
Lett Shaw Albert Wiedenhoeft (Seal)
Josephine A. Booth Mary Wiedenhoeft (Seal).”

At this time the fair, cash market value of the premises was $90 per acre an'd pursuant to said agreement Mr. and Mrs. Wiedenhoeft paid to appellee $300 to apply on the accrued interest of $680 but did not pay the further sum of $380 on or before August 1, 1930. On or about August' 13, 1930, Albert Wiedenhoeft came to the office of the agent of appellee and offered to pay $100 of the interest that by the terms of said extension agreement became due on August 1, 1930 but the agent of appellee told Wiedenhoeft that he could not accept the $100 under the extension agreement as that agreement had expired but that he would accept said amount as interest and indorse the payment thereof on the note, whereupon Wiedenhoeft paid the $100 to the agent of appellee. On October 28, 1930, Luke MeFarlin died and thereafter this claim was filed by Ella Lillie against his estate. In the county court the claim was allowed and upon appeal to the circuit court the cause was submitted to the court upon a stipulation of facts and the oral testimony of witnesses and resulted in a judgment in favor of the claimant in the sum of $6,400 and from that judgment the executor appeals.

It is the contention of appellant that by the provisions of the agreement of May 22, 1930 the time of payment of the debt secured by said mortgage was extended without the knowledge or consent of the mortgagors, that the grantees of said mortgagors assumed the payment of the mortgage debt and thereby the mortgagors were released from liability. Counsel for appellee insist that by the provisions of said agreement the Wiedenhoefts did not agree to pay the indebtedness secured by the mortgage and that by the terms of the agreement of May 22, 1930 appellee simply obligated herself in the event the Wieden-hoefts paid the sum of $380, being the balance of the interest due March 1,1930 on or before August 1,1930, that then and in that event she would extend the time of payment of the balance due on the principal, namely $13,600, to March 1, 1935.

The note, mortgage and agreement of May 22, 1930 were all executed and delivered in the State of Wisconsin and counsel for the respective parties agree that their legal effect is governed by the laws of that State. Counsel also agree that under the law of Wisconsin the assumption of the payment of a debt, secured by a mortgage cannot be implied but must be express and in the instant case it is conceded that prior to the execution of the instrument of May 22, 1930 there was no express assumption by the Wiedenhoefts of the indebtedness secured by the mortgage executed by the Mc-Farlins on October 31,1919.

The issue presented here for determination involves therefore the construction of the instrument of May 22, 1930 and is whether or not appellee did in fact extend the payment of McFarlin’s indebtedness and whether by that instrument the Wiedenhoefts agreed to pay said indebtedness. By the express terms of this agreement the maturity of the principal indebtedness was not extended but by its provisions appellee was barred until after August 1, 1930 from instituting a suit to foreclose her mortgage. The original note matured on March 1,1930. At that time $13,600 was due, being the balance remaining unpaid of the principal sum together with $680 interest. On and after March 1, 1930 the makers of the note evidencing that indebtedness, namely the McFarlins, had the legal right to pay that indebtedness and if they had done so they would have been subrogated to the rights which the holder of said note and mortgage had. After the execution of the instrument of May 22,1930 and on or before August 1, 1930 if the makers had paid their note and become subrogated to the rights of the holder thereof, their rights, in equity, would have been subject to the provisions of the agreement of May 22, 1930, which had been made without their knowledge and consent. During this period of time certainly the holder’s right of action against the mortgaged premises was suspended and if her rights were suspended, the rights of the makers of the note and the mortgagors of the premises, in the event they had paid the indebtedness and had become subrogated to the rights of the holder, would likewise have been suspended. The intention of the parties in making this agreement of May 22, 1930 must be gathered from the whole context of the instrument and the interpretation must be arrived at from a consideration of the entire document and not some particular part thereof. The' agreement stated that it was to become null and void unless $380 was paid by the Wiedenhoefts on or before August 1, 1930. If that sum was paid as provided in the agreement, then the payment of the principal sum was extended to March T, 1935. The effect of this provision was to extend the payment of $380, which was then past due, until August 1, 1930 and pending the arrival of that date the only reasonable conclusion which can be arrived at, consistent with the purposes sought to be attained by the execution of this instrument, is that appellee would take no steps to foreclose. What the Wiedenhoefts desired, so the instrument recites, was to have the payment of the $13,600 extended for five years from March 1, 1930.

Having concluded that by the provisions of the instrument of May 22,1930 the payment of the indebtedness then due was extended to August 1, 1930, the question then arises, did the Wiedenhoefts, the then owners of the mortgaged premises by that instrument agree to pay the mortgaged debt? It is apparent that the consideration for the execution of the instrument by appellee was the payment by the Wiedenhoefts to appellee of $300 on the day the instrument was executed. The agreement so recites. The instrument obligates the Wiedenhoefts to keep and perform the covenants and agreements contained in the note and mortgage except as changed by their agreement of May 22, 1930. One of the agreements of the note and mortgage was to pay the principal sum of $13,600 on March 1, 1930 and $680 interest thereon due that day. In what way did the agreement of May 22,1930 change this ? By the express terms of that agreement the payment of $380 of that sum was extended to August 1, 1930 and 'what the agreement must have implied was that the payment of the $13,600 was likewise extended to August 1, 1930. This is the construction the parties themselves placed upon this instrument. The ninth paragraph of the instrument uses the word “extension” and provides among other things that the principal sum of $13,600 then due, together with accrued interest thereon, shall become immediately due. When? In case of default in payment of $380 on or before August 1,1930.

Prior to the execution of this instrument the Wie-denhoefts were not legally obligated to pay the indebtedness secured by this mortgage or any part thereof. By its terms they agreed to pay that indebtedness and in consideration of the sum of $300 which they that day paid, appellee expressly extended the payment oh $380 of the indebtedness secured by the McFarlin mortgage and impliedly extended the payment of $13,600 principal sum then past due until August 1, 1930. This being true the mortgagors became discharged from personal liability.

In Prudential Ins. Co. of America v. Bass, 357 Ill. 72, the court says: “ ‘When a grantee thus assumes payment of the mortgage debt as a part of the purchase price, the land in his hands is not only made the primary fund for payment of the debt but he himself becomes personally liable therefor to the mortgagee or other holder of the mortgage'. The assumption produces its most important effect by the operation of equitable principles upon the relations subsisting between the mortgagor, the grantee and the mortgagee. As between the mortgagor and the grantee, the grantee becomes the principal debtor, primarily liable for the debt, and the mortgagor becomes the surety, with all the consequences flowing from the relation of surety-ship. As between these two and the mortgagee, although he may treat them both as debtors and may enforce the liability against either, still, after receiving notice of the assumption, he is bound to recognize the condition of suretyship and to respect the rights of the surety in all his subsequent dealings with them. . . . While the mortgagee may release the mortgage without discharging the grantee, his release of the grantee, or his valid extension of the time of payment to the grantee without the mortgagor’s consent, would operate to discharge the mortgagor.’ ”

In Reeve, Illinois Law of Mortgages and Foreclosures, vol. 1, sec. 310, the author states: “It is said that a mortgagor is released from liability for the mortgage debt when he conveys the property subject to the mortgage, which the grantee assumes to pay, and thereafter without the knowledge of the mortgagor, the mortgagee enters into an agreement with the grantee, extending the time for paying the mortgage debt, the reason for the rule being that by making such a contract with the mortgagor’s grantee, the original obligation of the mortgagor is materially changed.”

The trial court erred in rendering judgment against appellant and that judgment is reversed.

Judgment reversed.


text:
    George M. Loy, Appellee, v. Robert E. Sparks, Appellant.
    Gen. No. 9,460.
    Heard in this court at the October term, 1939.
    Opinion filed January 25, 1940.
    Rehearing denied March 19, 1940.

      Powers & Powers, of Streator, for appellant.
    Painter & Hates, of Streator, for appellee.
   Mr. Presiding Justice Dove

delivered the opinion of the court.

On April 23, 1937, the plaintiff George M. Loy entered into a written lease with the defendant, Robert E. Sparks, by the provisions of which Loy leased to Sparks his two-story brick building and lot 10 in block 21 in the city of Streator together with a five-horsepower electric motor and one Emery wheel stand, for a term of two years, beginning at noon on June 10, 1937 and ending at noon on June 10, 1939. The rent was to be paid in instalments of $125 per month beginning on June 10, 1937. The defendant was occupying the premises at the time the lease was executed and had been for several years. The building is two stories in height, 150 feet long and at the time the lease was executed was used by defendant as a garage. The lower floor is of cement and a ramp leads from the first floor to the second and disabled cars are hauled over this ramp to the repair department which is located at the rear of the second floor. The instalments of rent due July 10,1938, August 10,1938 and September 10, 1938 not having been paid, this suit was instituted by the plaintiff to recover this rent. The defendant answered and filed a counterclaim in which he alleged that the lease provided that the plaintiff would at his expense keep the roof, furnace, heating equipment and building in a good and serviceable condition for which it was leased and that the plaintiff failed to do so and permitted the electrical apparatus to become so badly out of repair that the insurance department of the State of Illinois insisted that it be rehabilitated and further permitted the floor of the second story and the ramp leading thereto to become so out of repair that it became dangerous for the employees of the defendant to work thereon, that the defendant repeatedly requested the plaintiff to make these repairs but he refused, that thereupon defendant caused the floor to be repaired at a cost of $442.50, of which amount he had paid the contractor the sum of $299.62 at the date the complaint was filed and caused the electrical apparatus to be repaired at a cost of $75.38, which amount he had paid, that said amounts so paid by him in making said necessary repairs aggregated $375 and defendant prayed for recoupment against the plaintiff for this amount. A jury was waived and the issues were submitted to the trial court resulting in" a judgment in favor of the plaintiff for $375 and the defendant and counterclaimant appeals.

The lease expressly provided that the premises were to be used by defendant only as a storage and repair garage, that appellee was to have full access thereto for the purpose of examining and inspecting the same, or to make any needful repairs or alterations and that he would “at his expense keep the roof, furnace and heating equipment and building in a good and serviceable condition for the purposes for which it is herein leased.” There is no serious conflict in the evidence. It discloses that the floor at the west or front end of the second floor, as well as the ramp leading from the first to the second floor, became unsafe and in such condition that they would not support automobiles as they were being transported thereon. An examination of the several photographs found in this record, as well as a consideration of the evidence of all the witnesses who testified disclose this to be true and appellant brought the matter to the attention of appellee, who positively stated he would not spend a penny in making any repairs thereon. The evidence further discloses that on May 27, 1938, a deputy fire marshal of this State addressed a written notice to appellee calling attention to the electrical equipment in this building and ordering the defects therein set forth corrected within 15 days. Appellee brought the matter to the attention of appellant and insisted it was his duty to make the corrections. Appellant contended that such repairs should be made by appellee. Appellee refused. Appellant was then required either to make the repairs to the floor, ramp and electrical apparatus or discontinue the use of the premises or at least a portion thereof. Appellant did what any sensible business man would do and it is not contended by appellee that the floor, ramp and electrical equipment did not need repairing nor is it insisted that the amount appellee expended in so doing was not the usual, customary and reasonable cost thereof. Appellee’9 contention is that appellant must have been the cause of the floor breaking through and he should have repaired it, but instead of repairing it he caused an entire new floor to be constructed and caused some new and heavier wiring and electrical equipment to be installed and now seeks to deduct the cost thereof from the amount concededly due appellee from appellant for rent. The uncontra-dicted evidence is that the floor could not be repaired and made serviceable for the purpose for which it was being used. John Lightholder, a building contractor, so testified. E. M. Rinehart, an electrical contractor for 25 years, testified about replacing the old fuse box near the front door with a new cabinet of eight switches and removed the old open knife switch and replaced it with a safety coil switch and the other work he did all as required by the notice to appellee from the fire marshal.

In appellee’s brief authorities are cited holding that the landlord is under no duty to make repairs unless he expressly agrees to do so by his lease and that inasmuch as appellant, the tenant, continued to occupy the leased premises he is obligated to pay the stipulated rent. Such is the law but where the landlord does expressly agree to keep the building in a good and serviceable condition for the purposes for which it is leased and breaches that covenant, then the tenant may make the repairs himself and deduct the cost thereof from the rent. Oppenheimer v. Szulerecki, 297 Ill. 81. In the course of its opinion in that case the court said: “It has been held that where the landlord has agreed to make all necessary repairs and has refused to do so upon proper request, the tenant may make the necessary repairs and charge them to the landlord,” and quotes from Taylor on Landlord and Tenant as follows : “ ‘ A general covenant to repair, when made by the lessor, requires him not only to keep the premises in good repair but to put them in that condition although the tenant may have entered. ... If the landlord neglects to make suitable repairs after being thereunto required by the tenant, the latter may, after waiting a reasonable time, make such repairs himself and recover the expense from his landlord, or he may, at his option, leave the premises unrepaired and recover any damages he may have sustained from the landlord’s default therein.’ ”

Cromwell v. Allen, 151 Ill. App. 404, also quoted with approval in the Oppenheimer case supra, was an action by a tenant against her landlord to recover damages for personal injuries sustained by her when she fell through a board in a platform at the rear of the building onto which the rear door of the building opened. After stating that in the absence of special agreement the tenant takes the premises as he finds them subject to his own risk, that there is no implied covenant that they are fit for habitation or that they are in any particular condition of repair, the court said that the relation of landlord and tenant created no obligation or duty on the landlord to make repairs unless he assumed such duty by express agreement with the tenant. “In case a landlord fails to make repairs in violation of his covenant,” continues the opinion, “the tenant may (1) abandon the premises if they become untenantable by reason of want of repair; (2) he may make the repairs himself and deduct the cost from the rent; (3) he may occupy the premises without repair and recoup his damages in an action, for rent; (4) he may sue for damages for breach of the covenant to repair, and the damage recoverable in this last instance is usually the difference between the value of the premises in repair and out of repair.” After citing* textbooks and cases, the court then says: “The foregoing states the law as it is applied to ordinary breaches of the landlord’s covenant to repair generally; and, as thus stated, it must be admitted to be about what the ordinary landlord and tenant would expect to find it.”

In the instant case the evidence is that appellant had expended in making the necessary repairs which ap-pellee expressly obligated himself to make, an amount exceeding the amount due appellee under the lease for rent and to recover which this suit was instituted. By his answer and counterclaim appellant seeks to defeat appellee’s demand. The facts disclosed by this record sustain the allegations of his counterclaim and in our opinion the trial court erred in not so finding*.

The judgment appealed from is reversed and as this cause was tried by the court without a jury, judgment will be entered in this court in favor of appellant and against appellee in bar of the action.

Judgment reversed and judgment here.


text:
    Kathryn Clark, Appellee, v. Richard Hasselquist et al. Richard Hasselquist, Appellant.
    Gen. No. 9,473.

      Heard in this court at the October term, 1939.
    Opinion filed January 25, 1940.
    Rehearing denied March 19, 1940.
    Kenworthy, Shallberg & Harper, of Moline, for appellant; S. R. Kenworthy and R. G. Graham, of Chicago, of counsel.
    Harry E. Brown, of Geneseo, and Edward L. Eagle, of Rock Island, for appellee.
   Mr. Presiding Justice Dove

delivered the opinion of the court.

This is a suit brought by Kathryn Clark against Richard Hasselquist, Raymond Gray and Edward Keegan to recover damages for injuries which she sustained when the automobile in which she was riding as a guest of Hasselquist came into a collision with an automobile of the defendants Gray and Keegan. The complaint consisted of one count and among other things charged that the automobile in which the plaintiff was riding as a guest on August 8, 1937 was being driven east by Hasselquist on U. S. Highway No. Six, where the highway curves to the southward, that Has-selquist was driving at an excessive rate of speed of 60 miles per hour, that the defendants Gray and Kee-gan were intoxicated and unable to control the automobile which they occupied, that they were driving their car very slowly or had parked their car upon the south and west or left side of the paved portion of the highway and failed to have any lights on their car in time to warn approaching cars. The complaint also averred that the plaintiff was at all times in the exercise of due care and caution for her own safety and charged that Hasselquist had prior to the accident been drinking intoxicating liquor and was unable to control himself and properly operate his car at the time of the collision, that plaintiff had repeatedly requested her driver to be more careful and proceed more slowly but he disregarded her requests and wantonly and wilfully drove his car into the Gray and Keegan car. The defendant Hasselquist answered admitting that the plaintiff was riding with him as his guest upon the night and at the place charged, admitted that the Gray and Keegan car was in the east traffic lane as charged, that Gray and Keegan were intoxicated and unable to operate or control their car and that they failed to have lights on their car in time to warn approaching cars, denied that plaintiff was in the exercise of due care and caution for her own safety and denied the other averments of the complaint. The defendants Gray and Keegan were served with summons but made no appearance or answer. They were not defaulted but the issues made by the complaint and the answer of Hasselquist were submitted to a jury, resulting in a verdict finding Hasselquist guilty and assessing plaintiff’s damages at $6,000. Upon this verdict judgment was rendered and this defendant appeals.

The evidence discloses that prior to and for some time after August 7, 1937 appellee and appellant had been keeping company and were frequently together. Appellee was 19 years of age, lived at Geneseo with her parents and on August 7,1937 came from her home by train to Moline. By appointment appellant met her at the station about 8:30 in the evening. He was a young man 20 years of age and was driving his father’s car and they went from the station to a moving picture theater and from there to the Fort Armstrong Grill, where she had a glass of ginger ale and he drank either a glass or a bottle of beer. They danced and left the hotel to drive to appellee’s home about 12:30 a. m. The evening was pleasant but dark, the headlights of their car were burning and the pavement dry. They proceeded over the Colona road to route six, a paved highway. At this intersection and before entering route six, appellant stopped his car. They then proceeded along route six over the Rock River bridge and thence eastward three-eighths of a mile. The road was straight and there was no traffic in either direction. An oak tree is located on the south side of the slab and the “Lone Oak Tavern” is located about 150 feet southwest of the Oak tree. It was near this tree where the collision occurred. About 200 feet west of the tree is the beginning of the curve in the highway to the east and just beyond the tree the pavement begins its curve to the south. The distance from the hotel in Moline to this curve is approximately 12 miles and they arrived at the curve about one o’clock a. m. As the car in which the parties hereto were riding entered the curve the lights of another car appeared directly in front of them headed west and in their traffic lane. Appellant applied his brakes but his car proceeded and there was a head-on collision between his car and an automobile in which Raymond Gray, Wanda Gray, his wife, and Edward Keegan were riding. As a result of that collision appellant was rendered unconscious and appellee sustained the injuries for which she is seeking to recover.

Appellant was familiar with this road as he had traveled it many times, as frequently as once or twice each week during the summer of 1937, to see appellee at Geneseo. According to the testimony of appellee their car crossed over the black line marking the center of the pavement as they made the sharp turn onto the Rock River bridge and she there said to appellant to “take it easy, Dick.” Appellant denied this. According to the testimony of appellant he had been driving between 40 and 45 miles per hour after he left Moline and at the time of the impact between 20 and 28 miles per hour. Appellee testified that in her opinion the instant before the collision he was driving 65 miles per hour and at the time of the impact he was going between 40 and 45 miles per hour. Wanda Gray, wife of Raymond Gray, and Edward Keegan testified on behalf of appellee to the effect that they observed appellant’s car as it approached the car in which they were and in their opinion it was going 60 miles per hour. The evidence is further that the Keegan and Gray car was headed west and in the east-bound traffic lane. It was either going very slowly or had stopped. Keegan and Gray were drunk and the weight of the evidence is that the lights on their car were not burning until appellant’s car was within not more than 75 feet of their car. A written statement signed by appellee was offered and admitted in evidence. It was signed by her four weeks after the accident. In this statement she said appellant, at the time of and preceding the accident, had been driving at a moderate rate of speed, that she had no recollection of seeing the other car and did not remember the collision. Other witnesses testified that appellee told them that she was resting her head on the back of the seat and was dozing and didn’t know the accident had happened, that ap-pellee had frequently stated that appellant was not to blame in any way and that the accident was not due to any fault of his. The testimony of Keegan and Wanda Gray cannot be given much credence and furthermore their evidence upon this trial was at variance with their testimony upon another trial of another case involving this same accident.

It is insisted by counsel for appellant that the court erred in permitting improper questions to be asked and answered by the witness John Buckley; that the verdict of the jury is manifestly against the weight of the evidence; that the court erred in giving to the jury appellee’s second instruction and that counsel for ap-pellee made an improper argument to the jury.

The record discloses that John H. Buckley was called as a witness on behalf of appellant and testified on direct examination to securing a statement which was signed by appellee, to which we have referred. On cross-examination the record discloses the following questions propounded to this witness and his answers thereto.

Q. Were you working for anyone September 3, 1937, when this statement was taken?

Mr. Graham: Object to that.

The Court: He may answer.

A. I was investigating the case for Kenworthy, Shallberg and Harper.

Q. Were you investigating the case at that time for anybody else?

Mr. Graham: Object to that. Immaterial.

The Court: He may answer.

A. Yes, sir.

Q. Who?

Mr. Graham: Object to that.

Mr. Eagle: We certainly have a right to show the interest of this witness in this case.

Mr. Graham: That isn’t the question.

Mr. Eagle: It certainly is and we want to be heard on it. We have a right to show the interest of this witness.

Mr. Graham: I object to the remarks of counsel.

The Court: Objection overruled. He may answer.

A. Yes, Mr. Hasselquist.

Q. Anybody besides Mr. Hasselquist and Mr. Ken-worthy’s firm?

Mr. Graham: I object to that.

The Court: He may answer.

Q. Why do you hesitate, Mr. Witness? Can you answer that question?

A. I can answer it.

Q. Answer it.

A. The Travelers Insurance Company.

Mr. Graham: I make a motion—

The Court: You can make a motion afterwards.

Mr. Graham: I want the record to show I make a motion to withdraw a juror.

The Court: Motion denied.

Mr. Graham: And move for a mistrial.

The Court: Motion denied.

From the foregoing it appears that after Buckley-had testified that he was investigating the case for appellant and for his counsel when he obtained ap-pellee’s statement on September 3, 1937, counsel for appellee persisted in asking him who else he was investigating the case for and he replied the Travelers Insurance Company. In his closing argument to the jury, counsel in commenting upon the visit of Buckley to the hospital on September 3 and the statement he that day obtained from appellee said: “He,” referring to appellant, “brought this fellow (Buckley) up to help her? Oh, no, Buckley wasn’t up there to get a statement that would help her in this case. He was up there to get a statement to help his employer.” Counsel for appellee argue that there is nothing in this record to show that the Travelers Insurance Company was the insurance carrier in this case. If not, it was not the fault of counsel for appellee. They succeeded in apprising the jury that appellee, the plaintiff in this suit, who was severely injured as a result of this collision while riding as a guest of appellant, was interviewed by a party who was investigating the case for appellant and for his attorneys and for the Travelers Insurance Company and that his purpose in procuring a statement from appellee was to help his employer. The liability in the instant case, if any, is primarily that of appellant and it was improper and prejudicial to deliberately bring to the attention of the jury facts from which the jury could only infer that their verdict, if they found the defendant guilty, would be satisfied not by defendant but by someone else. Evidence that defendant carries indemnity insurance protecting Mm from paying any judgment in an action for negligence is not admissible. Briggs v. Golden Cream Dairy, Inc. 298 Ill. App. 628 (Abst.); Peterson v. Jones, 283 Ill. App. 652 (Abst.); Wiersema v. Lockwood & Strickland Co., 147 Ill. App. 33. It is true as counsel for appellee argue that they had a right to show by questions on cross-examination any and all interest of Buckley in the case which might affect the weight and credit to be given Ms testimony and that it is proper to show the relationship which exists between a witness and the parties to the suit, but here, after Buckley had testified that he was investigating this case for appellant and his attorneys, counsel for appellee assumed he was investigating the case for some other party not a party to this record and his answer disclosed that other party to be an insurance company. In our opinion this examination by counsel, when considered in connection with their argument to the jury, was for no other purpose than to disclose to the jury that the Travelers Insurance Company was the insurance carrier and the trial court erred in permitting counsel to pursue their inquiries after Buckley had stated that he was investigating this case for appellant and his counsel of record.

It is next insisted by counsel that the evidence does not disclose that appellant was guilty of wilful or wanton misconduct, and that the verdict of the jury in so finding is manifestly against the weight of the evidence. A wilful and wanton act may be defined as an intentional disregard for a known duty necessary to the safety of the person of another and an entire absence of care for the person of another. In Streeter v. Humrichouse, 357 Ill. 234 the court said: “To constitute an act wanton, the party doing the act or failing to act must be conscious of his conduct, and, though having no intent to injure, must be conscious, from his knowledge of the surrounding circumstances and conditions, that his conduct will naturally and probably result in injury. An intentional disregard of a known duty necessary to the safety of the person or property of another, and an entire absence of care for the life, person or property of others, such as exhibits a conscious indifference to consequences, makes a case of constructive or legal wilfulness.” Excessive speed may or may not be evidence of wilful and wanton misconduct. The determining factor is the circumstances surrounding such excessive speed and the question is as stated in Streeter v. Humrichouse, supra, whether under the circumstances as they appear in this record did the speed at which appellant was driving show an entire absence of care for the safety of appellee and such as exhibited a conscious indifference to consequences 1 The allegation of the complaint to the effect that at and before the time of the accident appellant, because of having drunk intoxicating liquor was not in control of himself or able to properly operate his automobile was not sustained by the evidence and counsel for appellee do not insist that it does. Counsel for appellee do insist however that in addition to the speed at which appellant was driving just before the collision the evidence is that as he proceeded down a hill a mile before he arrived at the point of collision he was traveling at least 45 miles per hour, that there is also evidence to the effect that appellant in making the turn as he entered the Rock River bridge crossed the black mark over into the west-bound traffic lane, that appellant must not have had his car under control or he could have stopped it after he became aware of the presence of the Keegan-Gray car or if he could not have stopped he could have avoided striking it by turning his car out of his own traffic lane.

In the instant case appellant was proceeding east in his car along a highway with which he was familiar in the country at one o’clock in the morning, the night was dark, the pavement dry, his headlights were burning, there was scarcely any traffic and only one car had been observed while he had traveled a distance of almost 12 miles, he was proceeding in his proper traffic lane around a long, gradual curve, there were no intersecting roads and he had the right of way and while he should have assumed that other cars might be on the highway, he did have the right to assume that traffic coming from the opposite direction would be proceeding in their proper traffic lane and would be equipped with lights as required by law. How the Keegan-Gray car came to be where it was does not satisfactorily appear from the evidence. There is no evidence that it approached from the west end of the curve. The evidence of appellant is that when he first saw the light of this car he was 50 or 55 feet away. Appellee testified that she was watching the road, looking straight ahead and saw no part of the car, that she saw a light but couldn’t determine whether it was moving or still, that an instant later there was a crash and that she did not say anything after she saw the light.

We have carefully read the evidence as abstracted and examined the photographs appearing in the record and we do not believe this judgment can be sustained. Appellant may have driven carelessly but his conduct does not indicate that he was indifferent to the duty which he owed his guest. It is true that under the authorities whether appellant was guilty of wilful or wanton misconduct is a question of fact for the jury to pass upon but we are clearly of the opinion that their finding in this case is manifestly against the weight of the credible evidence in this record and thó trial court erred in not granting appellant’s motion for a new trial.

There was no error in giving the instruction complained of but for the errors indicated the judgment of the trial court will be reversed and the cause remanded.

Reversed and remanded.


author: Mr. Justice Huffman

text:
    F. J. Dillenburg et al. (Lauren J. Drake, Appellee), v. Charles F. Hellgren et al. (Frank V. Hellgren, Appellant).
    Gen. No. 9,478.
    Heard in this court at the February term, 1939.
    Opinion filed January 25, 1940.
    Rehearing denied March 19, 1940.
    John H. Armstrong and John A. Berry, both of Ottawa, for appellant.
    Arthur E. Bristol, of Chicago, and Richard O. Leitch, of Plano, for appellee.
   Mr. Justice Huffman

delivered the opinion of the court.

This is an appeal from a decree of the circuit court ordering a writ of assistance to issue against appellant for a tract of land in Kendall county. Charles F. Hell-gren and his wife Ada, executed a trust deed on the premises' involved herein on April 16, 1921, to secure the payment of their notes in the sum of $5,000. In April, 1933, suit was brought to foreclose against the mortgaged premises. The defendants in such suit were defaulted and a decree of foreclosure was rendered on December 20, 1933. The trial court rendered its decree in conformity with the Judgments and Decrees Act of 1921, which act had not taken effect at the time of the execution of the mortgage. The proceedings to sell the mortgaged premises should have been conducted in accordance with the provisions of the Judgments and Decrees Act of 1917. To this extent, the directory portion of the decree containing the provisions respecting the manner in which the decree was to be carried into effect, was improper. Pursuant to that decree, the master made sale of the premises and after the expiration of 15 months, issued a deed therefor to appellee.

In October, 1936, appellee petitioned the court for a writ of assistance, but upon discovering that the decree in directing the manner in which the sale of the premises was to be had, was improper, withdrew his application for the writ and filed a petition to amend the foreclosure decree, setting up that the acts had thereunder with reference to the sale of the premises, were erroneous, and praying that the decree be amended by a supplemental decree which should direct the master to make sale of the premises in accordance with the act of 1917. The defendants to the foreclosure suit filed their motion to strike such petition, on the ground that the foreclosure decree as originally entered, was a final decree; that more than five terms of court had elapsed since the same was rendered; and that the court had lost jurisdiction over the same. The motion to strike was denied and the original decree amended by supplemental decree, which provided for sale of the premises to be made by the master in the manner prescribed by the act of 1917. The defendants in that suit appealed to this court from the action of the trial court in rendering the supplemental decree. (Dillenburg v. Hellgren, 291 Ill. App. 448.) In that appeal, appellants urged that the court was without jurisdiction to thus amend its decree. This court in that case considered that such amendment in no way went to fix the rights or liabilities of the parties; that it was merely modal in character, and that the court had the right to change or amend its decree for the purpose of carrying* the same into effect, when such amendment or change was not substantial in character in that it did not tend to enlarge, modify, fix or change the rights or liabilities of the parties. Petition for leave to appeal in that case was denied by the Supreme Court. (Dillenburg v. Hellgren, 371 Ill. 452, 455.) Following the disposition of the petition for leave to appeal, the premises were sold by the master to appellee, pursuant to the amended decree, and a master’s deed executed and delivered to appellee and by him recorded on July 7,1938.

In the month of August, 1938, appellee petitioned the circuit court for writ of assistance. Objections to the issuance of the writ were filed by appellant, who alleged the conveyance to him of the premises in question on October 26,1936, by his father and mother (the mortgagors in the above mortgage). The objections by appellant were overruled and the writ was ordered issued. Appellant took an appeal in this instance to the Supreme Court. (Dillenburg v. Hellgren, 371 Ill. 452.) The facts contained in the petition for writ of assistance and in appellant’s objections filed thereto, appear on pp. 455, 456 of that opinion. The case was transferred to this court from that court, and is now before us for decision.

Appellant in this appeal from the order of the court granting the petition for writ of assistance, raises the same question that was raised by his father and mother as mortgagors in the former appeal to this court, that is, that the foreclosure decree of December, 1933, was final and that the court, when it rendered the supplemental and amended decree, was without jurisdiction, and that such supplemental decree was null and void; and further, that this appellant was not a party thereto, and that such decree was rendered without notice to him, thereby depriving him of his property without due process of law. The Supreme Court in its opinion at p. 456, calls attention to the fact that appellant’s objections do not contradict the allegation in the petition that his parents at the time the bill to foreclose was filed, were in possession of the premises and continued in possession thereof as owners of record, and that appellant and his wife resided with his parents on the property as members of their family. It is further suggested by the Supreme Court in the above opinion at pp. 456 and 457, that a court’s jurisdiction to render a judgment or decree, having once been attacked, the final adjudication of such issue precludes the raising of the question again. And further, that such adjudication is binding both upon the parties to the proceeding and their privies in title.

A court cannot, under the guise of correcting its record, put upon it an order or judgment which never in fact had been made or rendered. It cannot thus repair its own lapses and omissions to do what it could legally and properly have done at the right time. Gebbie v. Mooney, 121 Ill. 255, 258; Wesley Hospital v. Strong, 233 Ill. 153,159; Culver v. Cougle, 165 Ill. 417, 422; Cameron v. Clinton, 259 Ill. 599. However, this situation must be distinguished from those wherein the court can amend its judgment after expiration of the term. While proceedings for the amendment of judgments after the term at which they are rendered ought never he permitted to become revisory or appellate in their nature, or the means of enlarging, modifying or materially changing the judgment or decree with respect to the substantial rights of the parties, yet there are cases in which it so clearly appears that a certain portion of the decree or judgment rendered is not that which the law ought to have pronounced upon the facts as established by the record, that when such provisions of the judgment or decree are merely modal in character and do not serve to disturb the rights of the parties, such mistakes will be assumed to be inadvertent and the judgment may be corrected in such respect as to make it correspond with what it would have been, but for such mistake, in order that substantial justice may be done. Davenport v. Kirkland, 156 Ill. 169, 174; Kurd v. Goodrich, 59 Ill. 450, 458; Ernest Tosetti Brewing Co. v. Koehler, 200 Ill. 369, 372; Totten v. Totten, 299 Ill. 43, 45; Moore v. Shook, 276 Ill. 47, 53.

In this case the rights between the parties were established and fixed by that portion of the decree which found the indebtedness, the mortgage, and the default thereunder. The change made by the amended decree merely went toward the sale of the mortgaged premises and was not an amendment of the previous decree in a matter of substance as between the parties.

Appellant claims that the original decree entered in December, 1933, was a final decree; that the court had no jurisdiction over same after expiration of the term at which it was rendered; that the rule of caveat emptor, applied to the purchaser of the property at such sale; that the purchaser thereat obtained no rights thereunder and is not entitled to any relief because of such sale; that the second sale had under the amended decree was void because, the court had no jurisdiction to render the amended decree, and therefore the same was void and all steps taken thereunder void; and that the only lien now against the premises is the sum of $728.35, which was the deficiency existing from the first sale.

It was definitely settled in the former appeal to this court (291 Ill. App. 448) that the trial court had jurisdiction of the case at the time it rendered the amended decree. The position of this court in this respect was affirmed by the Supreme Court (371 Ill. 452, 457). Since the trial court had jurisdiction of the case at the time it amended the decree, appellant must be considered as haying acquired title to the premises during the pendency of the suit.

Some delay was encountered with respect to the first sale because of a restraining order issued out of the United States District Court pursuant to a petition by the mortgagors under the Frazier-Lemke Act. This order was vacated in June, 1935, and the first sale had in July, 1935. During all this time, appellant and his sister were living with his parents, the mortgagors, upon the premises in question. It appears that he acquired his title from his father and mother during the pendency of these proceedings, and therefore was a purchaser pendente lite. Such a purchaser is not a necessary party in a foreclosure suit, and he takes the property subject to any decree that may result therefrom. Kemper v. Weber, 318 Ill. 494.

The judgment of the circuit court is affirmed.

Judgment affirmed.