author: Pillsbury, J.

text:
    The First National Bank of Centralia et al. v. Edward B. Marshall.

      National Banks—Voluntary Liquidation—Disposal of Assets—New Bank—Bights of Stockholders—Estoppel—“Good Will'’—Lease.

    1. Where a national bank has gone into voluntary liquidation in pursuance of the vote of all its stockholders, and all but one of them have united in organizing a new national bank under a different name, and the omitted stockholder has accepted dividends from the proceeds of nearly the entire assets of the old bank, he can not claim to be a stockholder in the new bank nor a right to share in its earnings.
    2. In the case presented, the complainant is estopped from complaining that the greater part of the assets were sold to the new bank, as he knew they were thus disposed of when he accepted his share of the proceeds.
    3. The old bank having gone into voluntary liquidation had no “ good will” to dispose of, independent of the value of the unexpired lease of the building which it had occupied,
    [Opinion filed May 5, 1888.]
    Appeal from the Circuit Court of Marion County; the lion. Amos Watts, Judge, presiding.
    The First National Bank of Centraba was organized on the 23d day of March, 1865, with a capital stock of §80,000, divided into 800 shares of §100 each, in accordance with the National Bank Act. After its organization it did a regular hanking business until it went into voluntary liquidation about one month prior to the expiration of its charter. The appel" lee was one of the original stockholders, and at the time the bank went into liquidation, he owned §20,500 of the hank stock. At a meeting of the stockholders regularly called, on the 30th day of January, 1885, the question was submitted whether the bank should go into voluntary liquidation under the provisions of the National Banking Act, and every stockholder, including the appellee, voted to take such action and that it should take effect on the 25tli day of February following.
    On the 10th day of February, 1885, the Old National Bank of Centraba, one of the appellants herein, was chartered by the Controller of the Currency and organized with the same persons as officers and directors of the bank that constituted such officers and directory in the First National Bank. In this new organization the appellee did not become a stockholder. It seems from the record that Dr. Marshall, while holding a large amount of stock in the First National Bank, about September, 1883, started a new bank in Centraba called the Ex. change Bank, and by so doing, divided the hanking business of the city to some extent, and thereby injured the First National Bank in depriving it of business that it would otherwise have done to its profit.

      This action on the part of the appellee created unfriendly feelings between the other shareholders of the bank and himself, and several efforts were made by the officers of the National Bank to purchase his stock, but he asking §200 per share, a sum too large in their opinion, they did not buy. Matters were in this condition from that time until the cha:ter of the First National Bank was about to expire by the limitation of twenty year’s fixed in the National Banking Law for the existence of national banks. The officers, the directors and the shareholders, except appellee, desired to continue in the banking business but not with appellee, under the existing circumstances, and they corresponded with the Controller of the Currency, stating their wishes and asking his advice.
    His answer appears in the record and it seems to be conceded by counsel for all the parties that it is a fair interpretation of the banking law upon the points submitted.
    They were advised that unless the stockholders were unanimously in favor of a new organization to take the name of the former bank, it could not be done. That if they retained the old name, that everjr stockholder in the expiring association would be entitled to a preference in the allotment of shares of the new association, in proportion to the number of shares held by them respectively. They were also advised that there was no legal objection to the stockholders voting to place the old bank in process of voluntary liquidation, and the formation of an independent association for banking purposes, and that the department would have no objection to such course. Full instructions were given how to proceed, and necessary blanks furnished by the department. Acting upon this advice, a meeting of the stockholders was called to determine what course of action should be pursued in regard to winding up the affairs of the old bank, and all. the stockholders seem to have been fully advised of the object of the meeting.
    At this meeting every share of stock was voted in favor of putting the First National Bank in process of voluntary liquidation, the complainant below and appellee here voting more than one fourth of the shares of capital stock in favor of the proposition.

      The matters of closing up the business, the disposing of assets of the bank and the distribution of the proceeds, were placed in the hands of the officers of the bank, especially the cashier, Mr. Kohl. When the bank ceased to do business, on February 2oth, the newly chartered bank was prepared to, and did, commence a general banking business.
    The United States bonds held by the bank to secure its circulation were sold to the new bank at the current rate in the market, and re-deposited to secure the circulation of the new bank.' Other bonds were sold in the market for the current prices on day of sale. The greater portion of bills receivable were sold to the new organization, as well as all the fixtures and furniture belonging to the First National.
    Within ten days after the bank went into liquidation, a dividend of $100 to the share, was declared, and Dr. Marshall received $20,500. Within twenty-five days a further dividend was paid, of $50 per share. This last dividend was not paid in cash, but by mutual arrangement the undisposed of local bonds and securities, amounting to nearly $40,000, were divided among the stockholders, the appellee selecting from the entire amount his fro rata share, according to the amount of his stock.
    Additional dividends of five and one-half per cent, have been declared and paid, of which the appellee has received his proper share. Some assets of the bank still remain in the hands of Mr. Kohl, con fisting of some real estate and notes of hand which, if converted into money, would probably pay not far from five per cent, additional.
    In July, 1886, the appellee filed his bill in the Marion Circuit Court against the two banks and the directors and officers of the new organization, charging that the change of organization was for the purpose of “freezing him out,” as a shareholder in the First National Bank; that the new bank was created with the funds of the First National, and the same persons constituted the officers and directory, and turned over to themselves all the assets of the latter bank, and the same has ever since been under the control and appropriated to the use of the “ Old National Bank, ” the new organization; that by such action the stock of complainant was arrested and its earnings closed, although the money was used to sustain the latter bank. That the new organization had converted to its own use the interest of the complainant in the First National without his consent, and that all the actions of the parties defendant were had for the purpose of cheating complainant. He asks for general and special relief, and especially that an account may be taken of the earnings of the new bank, and that it may be decreed to pay complainant such proportionate share of its earnings as the stock of complainant bears to the capital stock of that bank.
    Answers were duly filed, a hearing had and a decree was rendered against all the defendants for over $8,000, and defendants bring the case here by appeal.
    Other facts are stated in the opinion of the court.
    Messrs. McCartney & Casey and Oasby & Dwight, for appellants.
    Messrs. W. S. Forman and Jas. Watts, for appellee.
   Pillsbury, J.

Section 5220 of the National Bank Act provides that “Any association may go into liquidation and be closed by the vote of its shareholders owning two-thirds of its stock.” The sections following provide in detail for winding up the affairs of the bank when such vote has been taken.

It is clear that the stockholders had the right to put the First National Bank into voluntary liquidation rather than to permit its charter to expire by limitation, as it would have done on March 25, 1885. The appellee, as one of the shareholders, voted all his stock in favor of that course.

When the bank ceased doing business on February 25,1885, it became the duty of those placed in charge of its affairs for the purposes of winding up its business to use all reasonable effort to realize out of the assets as much as possible and distribute the proceeds among the shareholders. When this has been done it is clear that the value of the stock can only he measured by the value of the assets. It is not contended by appellee, neither could it well be, that the First National was not legally put into liquidation. The appellee states in his testimony taken on the trial that he voted for liquidation, and he knew this course had its inception in the desire to get rid of him as a stockholder by the organizing of another national bank. There can be no doubt of the right of the stockholders after such vote was taken, to organize a new bank and to dispose of the stock to whomsoever they saw proper, so long as they committed no fraudulent act to the injury of the appellee. The complainant, with full knowledge of what had been done in putting the one bank into liquidation and the organizing of a new one, and the disposition of the assets of the bank by its directory, for he was furnished with a detailed statement by Mr. Kohl, received a cash dividend of 8100 upon each share of his stock, and joined with the officers of the bank in dividing up many of the remaining bonds and securities, selecting those he desired to take and thereby received f>50 per share additional. Instead of objecting to the action of the directory and Mr. Kohl and refusing to take his share of the proceeds derived from the sale of the assets and demanding recognition as a stockholder, or demanding an equal amount of stock in the new organization and offering to pay for it, as others did, he voluntarily, with a full knowledge of the facts, receives his pro rata share of each and every dividend declared, and his explanation of this act is that he never knew of any one objecting to receiving money,” that he knew the new bank would be organized and he left, but he intended “ to hold his grip.” > .

> He further says that when Mr. Kohl presented him with the statement of the disposition of the assets he “had no doubt to base an objection upon,” although admitting, in fact, that he knew how the assets of the bank were disposed of. He has also received two additional dividends, amounting to 85.50 per share, and taken the money without objection, making in the aggregate 8155.50 upon each share of capital stock held by him of the par value of $100, and the remaining assets, amounting, as estimated, to 84536.39, consisting of notes and a farm which had not been converted into cash at time of trial. As to these remaining assets, we think the proof shows that when Mr. Kohl called appellee’s attention to them, at the time he paid the last dividend, he told appellee that if he wanted the matter closed up at once he, appellee, could buy them or they would buy them, and appellee then directed Mr. Kohl to keep on the way he had been doing.

Now, after receiving his share of the assets disposed of, belonging to the First National, under the circumstances stated, we are at a loss to comprehend how he can claim to be pecuniarily interested in the “Old National Bank,” or entitled to any of its earnings.

He is, of course, entitled to a fair administration of the assets of the defunct bank, the First National, but upon what basis he can claim that his interest in such funds is to be measured by the present value of the stock in the new National Bank we can not perceive.

And yet the court below in its decree found that his stock in the First National Bank was of the value of $190.50 per share, when the assets as disposed of would not, perhaps, exceed in value $160 upon the share.

The record is barren of any proof that the assets of the First National Bank,in which appellee was alargo stockholder, consisting of bonds and bills receivable, and furniture and fixtures, were not sold at the current rates in the stock market, except the fixtures and furniture, the value of which was fixed by the opinion of witnesses varying from $1,000 to $1,600. There is no evidence in the record that the United Btates bonds were sold to the Old National Bank at a less price than current quotations, nor that the bills receivable did not bring all they were worth, and, as to the $40,000 worth of local bonds and securities divided between the stockholders, the appellee can not complain, as he joined in the division and made his own selection for the stock, or surplus dividend of $30 per share. We have been unable to find any evidence in the record that justifies the action of the court below in finding that the stock of the appellee in the First National Bank was worth, when the vote for liquidation took effect, 8190.50 per share. As we have said, if the assets of that bank were properly administered, the value of the property of the bank would determine the value of the stock. and, if the assets were disposed of for their fair market value, the appellee has no reason to complain. We think he is estopped from insisting that the greater part of the assets were sold to this new organization, as he knew they were thus disposed of when he accepted his share of the proceeds; but if he can establish ■that, by an unlawful combination between the two banks, the assets were not sold for their fair market value, he can have an account taken of the value of his stock, based upon such fair value of the assets of the bank, and have a decree for such difference.

A mere honest difference of opinion between him and the other parties authorized to wind up the affairs of the bank, will not, however, render those officers, or the First National Bank, liable to account, but if it should appear, upon a re-trial of this case, that the First National Bank, through its custodian of the assets of the bank, had fraudulently disposed of the property of the bank for the purpose of aiding themselves at the expense of appellee, by selling them for less than their fair value, those taking part in such fraudulent practices must be held to respond to complainant below, and if it should appear that the Old National Bank was a party to such fraud, a decree might well go against it to account for the fair market value of all assets received by it for less than their fair value. We think the complainant is entitled to a fair and honest disposition of the property of the bank and is entitled to receive his just and fair proportion of the proceeds thereof, according to the amount of his stock in the bank compared with the entire capital. At the same time we hold that he can not claim to be a stockholder in the new bank, nor entitled to share in its earnings, nor object to the transfer of the assets of the bank in which he was a stockholder to the new organization, as, with a full knowledge of all the transactions, he took his money arising out of the payments made by the latter bank for such assets. The evidence is very conflicting as to the value of the fixtures, safe, books and blanks of the First National, sold "to the Old National Bank. They were carried on the boohs of the former bank at the value of $1,600 and were sold to the new bank for §1,000, and, if the correctness of the decree depended upon this item alone, we should not be disposed to interfere with it, but we are of the opinion that the court erred in finding from the evidence in this record that appellee’s.stock was of the value of §190.50 per share, upon the ground that he was equitably entitled in some way, to a share in the profits of the Old National Bank, and without determining whether the assets of the First National Bank had been fraudulently disposed of for less than their value to the injury of the appellee. What we have said disposes also of the question of the “good will” of the First National Bank which it is claimed was obtained by the Old National Bank, as the lease of the building was assigned to it and the business 'carried on in the same place.

The First National voluntarily closed its doors as a banking institution on the 25th day of February, 1885, and then ceased to exist as a banking institution. It did not, neither could it, thereafter dispose of its franchise held by it under the law. It had no “good will” to dispose of independent of the value of the unexpired lease for the bank building, This lease was made by appellee to the First National Bank, or its successor, in September, 1833, for five years, and the unexpired term was clearly an asset of the bank which should have been disposed of to the best advantage.

Upon a sale of it, the “good will” would necessarily enter into consideration in determining its value. Dougherty v. Van Nostrand, 1 Hoff. Ch. 68; Austin v. Bays, 24 Beav. 598.

If the parties appointed to wind up the business of the First National Bank have acted in good faith, and with reasonable diligence, they should be allowed a fair compensation for their serv. ices before final distribution is made of the remaining assets.

For the reasons stated the decree will be reversed and the cause remanded for further proceedings.

Reversed and remanded.


source: Caselaw Access Project

author: Pillsbuby, J.

license: Public Domain

text:
    City of East St. Louis, for use, etc., v. Alexander Flannigan et al.

      Municipal Corporations—Indebtedness—Constitutional Limit—Contract <co Furnish Gas—Warrants Drawn against Particular Fund—Treasurer —Action on Official Bond of—Parties.

    L Although municipal corporations can not become indebted in any manner or for any purpose beyond the constitutional limit, they may, for the purpose of paying current expenses, anticipate the collection of revenues already levied and appropriated to the payment of such expenses. Warrants drawn upon the treasury in payment of such expenses must be payable out of particular funds so appropriated, the corporation incurring no liability whatever.
    2. Where there is an agreement to furnish gas for street lights, payment to be made monthly as the gas is furnished, no present liability is created, and warrants drawn for gas furnished after the levy against a fund appropriated for the purpose, are valid.
    3. A municipal corporation may maintain an action, for the use of a person injured, on the official bond of its Treasurer, for a refusal to pay warrants drawn against a particular fund in bis custody.
    [Opinion filed May 5, 1888.]
    In error to the Circuit Court of St. Clair County; the Hon. Amos Watts, Judge, presiding.
    April 20, 1886, the defendant in error, Flannigan, was appointed City Treasurer of the City of East St. Louis, and on the same day executed his official bond, with his co-defendants as sureties, in the sum of §100,000, which was duly approved by the City Council.
    This suit is brought upon that bond by the obligee therein, the city, for the use of one W. D. Griswold, and five breaches of the condition of the bond were assigned, substantially as follows: l(For non-payment of five several city warrants
    drawn on him by order of the City Council in favor of W. D. Griswold, in payment of gas furnished the city for the months of July, August, September, October and November, 1S86."’ The assignments are substantially identical in terms, except as to the dates, serial numbers and amounts of the warrants, and the months for which they are drawn. They recite that after the appointment, etc., of said Flannigan as Treasurer as aforesaid, the fiscal year of said city for the year 1886 commenced on the first day of July, 1886, and that thereupon the City Council of said city duly made its appropriation ordinance for said year, as required by law, in the sum of $113,056, of which amount $7,500 was specially appropriated for lighting the streets of said city, and that afterward, in September following, the Council duly levied upon the taxable property in said city a tax amounting to the sum of $64,129, of which amount, also, $7,500 were specially appropriated and set aside for lighting said streets, and that said tax was duly extended, etc., according to law. That at the beginning of said fiscal year said city was, and ever since that time has been, indebted beyond the constitutional limit, and could contract no further indebtedness. That said city contracted with said Griswold to light the streets of said city during said year for a certain price agreed upon; that said lighting was a necessary and ordinary expense of the city; that the latter had no money in the treasury to defray the sáme, and that the city promised Griswold to issue to him, in payment for such lighting, its warrants to he drawn against and in anticipation of said taxes so appropriated and levied for lighting said streets; that said Griswold did light said streets in pursuance of said contract, and tendered his bills therefor, which were allowed by the Council, and that thereupon the Council, having provided that warrants might be drawn against said taxes, issued to said Griswold its tax warrants for the amounts so allowed him, in payment of such bills; that said warrants were duly signed by the Mayor, countersigned by the City Clerk, and sealed with the seal of the city, and were specially drawn against said taxes so levied and appropriated for lighting said streets and were payable out- of said appropriation only. ' (The warrants are set out in haee verba in the declaration and are four for $509.85, and the fifth for §554.15.) That there was also during all of said year an ordinance of said city which provided that all warrants should foe drawn against a particular fund, and should be paid by the Treasurer on presentation, if there be any fund in the treasury belonging to such fund, and which also made it the duty of the Treasurer to keep a separate account of each fund or appropriation, and on receiving any money from any tax levy, to credit each fund with its pro rata share, and which further made it his duty to pay out the money of the city coming into his hands as aforesaid on orders of the City Council, signed by the Mayor, countersigned by the Clerk, and signed with the city seal. That since the issuing of said warrants there has come to the hands of said Flannigan, as such Treasurer, the sum of $18,837, collected of said tax levy of said city for the year 1886, and that the pro rata share thereof specially appropriated for street lighting is $2,179. That said Griswold, before said Flannigan received said money, gave notice to the latter and presented to him his warrants; and that after said Flannigan received said money, he again presented said warrants and demanded payment thereof; and that said Flannigan, although he had in his hands a sufficient sum, the proceeds of said tax levy, and specially appropriated for lighting said streets, to pay said warrants, refused, and failed to pay the same, and that he has wilfully misapplied said money for other purposes and converted the same to his own use.
    A general demurrer was interposed to the declaration which the court sustained, and the plaintiff electing to abide by its pleadings, judgment for the defendant went in bar of the action, and the city sued out this writ of error.
    Mr. W. 0. Kueeffteb, for plaintiff in error.
    In this case, as the city was indebted beyond the constitutional limit, the only remedy is against the officer having the funds in charge.
    With regard to municipal corporations indebted beyond the constitutional limit, which issue warrants in payment of services rendered, the Supreme Court has construed the legal effect of such warrants to be as follows:

      “Where a warrant or order, payable from a specific appropriation or tax, levied but not yet collected, is accepted for services rendered or to be rendered, or for materials furnished, so that there is, in fact, but the exchange of one thing for another, the duty remains for the proper officer to collect and pay over the tax in accordance with the appropriation; but obviously, for any failure in that regard, the remedy must be against the officer, and not against the corporation, for otherwise a contingent debt would in this way be incurred by the corporation.” City of Springfield v. Edwards, 84 Ill. 634.
    “ When a city is indebted beyond the constitutional limit, and it hires labor, as it can incur no debt, it may, in thus hiring or purchasing, agree to transfer so much of the tax thus levied as will pay for the same, and if the agreement is not so expressed in terms, the law will imply one to that effect.” Law v. The People ex rel., 87 Ill. 385.
    As it was the duty of the City Treasurer, under the law and the city ordinance, to pay these warrants out of the money in his hands specially levied and appropriated for their payment, a suit on his bond will lie for the violation of this duty for the use of the party injured.
    “Whenever a functionary of any grade is endowed by law or ordinance with powers involving the receipt or custody of public money or property, or the liberty or property of private persons, that officer, as a rule, is bound to give security that he will faithfully discharge the duties which the law imposes upon him. The bond is universally considered the great safeguard of the public interest as well as the surest remedy of private grievances.” Mur free on Official Bonds, Sec. 310.
    “The laws which provide for the execution of bonds similar to the one before us, do not require them for the purpose of protecting the rights of the State alone. They are also designed to secure the faithful performance of official duties, in the discharge of which individuals and corporations have a deep interest, and, therefore, they should have the privilege of suing on such bonds for injuries sustained by them, through the negligence and malconduct of the officer.” Ib. Sec. 323 ; State, for use, etc., v. Norwood, 12 Md. 177, 194.

      “ The law, in requiring an official bond, contemplates it as security for those whose rights it commits in certain cases to the officer.” Murfree on Official Bonds, Sec. 486.
    The official bond of a County Clerk, made payable to “the People of the State of Illinois,” may be sued on for the use of the parties injured, although the statute contains no special provision that suit may be brought in that manner. Satterfield v. The People, for use, etc., 104 Ill. 449.
    “ It is sufficient if the plaintiff had the legal interest. * * * If he has parted with the beneficial interest, the equitable assignee has the undoubted right to sue in his own name to enforce the liability. * * * It is a matter of no importance whether the plaintiff had any substantial interests in the subject-matter of this proceeding, or whether it was commenced with his knowledge or by his consent.” Bryant et al. v. Dana, 3 Gilm. 349.

      “ The suit is in the name of the proper person, and it makes no difference to the defendant for whose benefit it is brought. As was said in the case of McHenry v. Bidgley, the court will not inquire whether the plaintiff sues for himself, or as trustee for some other person. It is sufficient that he has the legal interest.” Chadsay v. Lewis, 1 Gilm. 159.
    6 The words, for the use of Maurice L. Whiteside, add nothing to or detract nothing from the right of recovery. Whiteside is not the legal, but the beneficial plaintiff. All after the name of the real plaintiff may be rejected as surplus-age. When a recovery is had, the question may then arise whether the People or Whiteside shall have the money. I. & St. L. R. R. Co. v. The People, 91 Ill. 455.
    Messrs. B. A. Halbebt and Tubiteb & Holdeb, for defendants in error.
    The supposed contract set out in the declaration is void, and the city had no power to appropriate money or levy taxes to carry it out. Howell v. City of Peoria, 90 Ill. 104. It was against public policy for Griswold and the city to make an agreement for the lighting of the city for one year, the city being indebted beyond the constitutional limit, no tax having been levied and not even an appropriation having been made for the purpose of lighting the city. There was no tax levy in process of collection to be anticipated; no tax levied; no estimate made of the current expenses of the city for the fiscal year upon which a tax levy could be based. This is not the condition suggested hy the Supreme Court in City of Springfield v. Edwards, 84 Ill. 626; Law v. People, ex rel., 87 Ill. 385.
    The proceedings set out in the declaration are dearly in violation of the Constitution, its letter and spirit.
    It was the intention of the people in adopting the Constitution to prevent the reckless extravagance of city governments which had theretofore prevailed, and to cut off all expenses unless the city had the money in its treasury with which to pay, or a tax levy in process of collection which could he assigned to the persons rendering services, at the time the services were rendered.
    This supposed contract being void—the city and Griswold both being parties thereto—neither the city nor Griswold can enforce it directly or indirectly, in law or in equity. Penn v. Bornman, 102 Ill. 523.
    The city, then, and the person for whose use the suit is brought, were manifestly and knowingly engaged in violating or evading the organic law of the land; the enforcement of such contract, the collection of the money stipulated in such contract to be paid, from the sureties of the Treasurer, would undoubtedly encourage future evasions of the law, and the courts will not assist either the city or Griswold in carrying ont such void contract. On this ground alone the demurrer was properly sustained by the Circuit Court.
    The liabilities of sureties on official bonds are limited by their terms, not only as to what the sureties are liable for, hut also to whom they are responsible. Third persons generally can have no beneficial interest in a bond of this character, unless a provision to that effect is embodied in the statute which authorizes the bond. Mnrfree on Official Bonds, See. 184; Brown v. Phipps, 6 Smed. & M. 57.
    A breach of the bond must be alleged and proved as to the obligor. Mnrfree on Official Bonds, Sec. 468, and notes thereto.

      And this is peculiarly so as to bonds given by city officers to secure the faithful performance of their duties to the city-Most of the powers granted to a city are purely local, and not governmental in their character. This is so as to the care and control of sewers, water works, public buildings, gas works> etc. Their contracts in respect thereto are not made by the municipal corporation by virtue of its local sovereignty, bn* in its capacity of a private corporation. Western Saving Fund Society v Philadelphia, 31 Pa. St. 183; Wheeler v. Philadelphia, 77 Pa. St. 354; People v. Hurlbut, 24 Mich. 103; Board of Park Commissioners v. Detroit, 28 Mich. 237; Small v. Danville, 51 Me. 361; Oliver v. Worcester, 102 Mass. 49; San Francisco Gas Co. v. San Francisco, 9 Cal. 453; Western College v. Cleveland, 12 Ohio N. S. 375; State v. Tappan 29 Wis. 664; Atkins v. Randolph, 31 Vt. 26; People v. Mayor of Chicago, 51 Ill. 30; Galena v. Corwith, 48 Ill. 423; DeVoss v. Richmond, 18 Gratt. 338; Lloyd v. Mayor of New York, 5 N. Y. 374.
   Pillsbuby, J.

Two principal points are made against the right of the plaintiff in error to maintain this action for the use of Griswold: First, that as the contract was entered into before the tax was actually levied, it was void as creating an indebtedness against the city when it was already indebted beyond the constitutional limit of five per cent, upon the assessment of the previous year; and second, that the bond in suit is not for the benefit of individuals but to secure the city, and as the city had discharged itself from all liability by issuing the warrants upon, this special fund it has not been damnified, and therefore no breach of the bond has accrued upon which any one can hold the sureties.

The constitutional provision relied upon is the 12th section of Art. 9, and is this: “ Ro county, city, township, school district, or other municipal corporation, shall be allowed to become indebted in any manner or for any purpose, to an amount, including existing indebtedness, in the aggregate exceeding five per centum on the value of the taxable property therein, to be ascertained by the last assessment for State and county taxes, previous to the incurring of such indebtedness.”

This provision has frequently been construed by the Supreme Court and its effect upon “temporary loans,” “ certificates of indebtedness ” and “ contracts creating liabilities in the future,” passed upon and determined, and it will only be necessary for ns to ascertain the law thus declared and apply it to the facts of this case as shown by the averments of the declaration.

In the City of Springfield v. Edwards, 84 Ill. 626, a bill was filed by a taxpayer to enjoin the city from incurring indebtedness and levying and collecting taxes in violation of the charter and of the constitution. It appeared in that case that the city, although indebted beyond the constitutional limit, had been borrowing money to pay current expenses, and had issued warrants made payable at a future day with interest, and had also issued bonds for some of the loans thus made.

It was contended in that case by the city that when liabilities are created -and appropriations are made which are within the limits of the revenue accruing to meet them, they are not debts within the meaning of the prohibition of the constitution, and that temporary loans are not, when within the limit of the revenue expected to be realized. Authorities were referred to from other States bearing upon this contention and the rule deduced from them by our court is thus stated: These cases maintain the doctrine that the revenues may be appropriated in anticipation of their receipt, as effectually as when actually in the treasury; that the appropriation of moneys, when received, meets the services as they are rendered, thus discharging the liabilities as they arise, or rather anticipating and preventing their existence.”

The court, then, after commenting upon the language of the provision of the Constitution above quoted, and considering what kinds of indebtedness are within its terms, announces its conclusion as to the rule that should obtain in this State as follows:

“ In this view, we are only prepared to yield our assent to the rule recognized by the authorities referred to, with these qualifications: First, the tax appropriated must, at the time, be actually levied; second, by the legal effect of the contract between the corporation and the individual, made at the time of the appropriation, the appropriation and issuing and accepting of a warrant or order on the treasury for its payment, must operate to prevent any liability to accrue on the contract against the corporation.

“ The principle, as we understand, is, that there is in such case no debt, because one thing is simply given and accepted in exchange for another. When the appropriation is male and the warrant or order on the treasury for its payment is issued and accepted, the transaction is closed on the part of the corporation, leaving no future obligation, either absolute or contingent upon it, whereby its debt may be increased.

“ But until a tax is levied, there is nothing in existence which can be exchanged, and an obligation to levy a tax in the future, for the benefit of a particular individual, necessarily implies the existence of a present debt in favor of the individual against the corporation, which he is lawfully entitled to have paid by the levy. If the making of the appropriation and issuing and accepting a warrant for its payment does not have the effect of relieving the corporation of all liability, or, in other words, if it incurs any liability thereby, it must manifestly incur, either absolutely or contingently, a debt.

“ Where a warrant or order, payable from a specific appropriation of a tax levied but not yet collected, is accepted in exchange for services rendered or to be rendered, or for materials furnished, so that there is, in fact, but the exchange of one thing for another, the duty'remains for the proper officers to collect and pay over the tax in accordance with the appropriation; but obviously, for any failure in that regard, the remedy must be against the officers and not against the corporation, for otherwise a contingent debt would, in this way, be incurred by the corporation.”

Again, in Law v. The People, 87 Ill. 385, the question came before the Supreme Court, arising, however, upon the right of the City of Chicago to issue certificates of indebtedness to be paid out of the tax levy of the year for current expenses, and it was held that such certificates were void, as creating an additional indebtedness to be paid in the future, and that the case was within the principle of the Edwards case and governed by it. For the purpose of showing how the court construed the Edwards case we quote from the opinion in the Law case.

“ In the case of The City of Springfield v. Edwards, 84 Ill. 626, we pointed out the manner in which revenue already levied and to be collected might be anticipated without the city becoming indebted, or violating the constitutional or statutory prohibition, and the questions presented by this record are essentially the same as in that, and must be governed by that case. In that case it was held that the tax upon which the warrant is drawn must, at the time, be actually levied, and the delivery of the warrant on the treasury must have the legal effect and operate as a contract between the corporation and the person receiving the warrant, that the city shall thereby incur no liability whatever. In such a case there is no debt incurred, because the warrant on the Treasurer is received for the work done or the articles furnished.” The doctrine of these cases was re-affirmed in Fuller v. The City of Chicago, 89 Ill. 282. Howell v. City of Peoria, 90 Ill. 104, was a case where the city had contracted with Dean Brothers to build and set up in the city certain water works pumps for the sum of $11,000, one fourth to be paid down and the baHnce in equal payments of $2,750, payable at different times in the future, with eight per cent, interest, and to secure the deferred payments the city was to give its three promissory notes. At the suit of a taxpayer the court held the contract invalid as increasing the indebtedness of the city, it being already indebted beyond the constitutional limit.

In the case of this same plaintiff in error against the East St. Louis Gas Light and Coke Company, 98 Ill. 415, the action was brought by the gas company to recover certain monthly installments due it for gas furnished for lighting the streets of the city. It appeared in that case that in 1874 the city entered into a contract with the gas company to erect lamp posts and extend its street main pipes so as to accommodate the city and to furnish gas at a certain price per lamp per year, to be paid in monthly installments. The contract was to continue for thirty years from October 1, 1874.

It was insisted by the city, in that case, as one objection to the contract, that by it an indebtedness of §211,200 was created against the city, it requiring that sum to pay for the gas furnished under it for the thirty years it was to run. The previous indebtedness of the city was only §20,000 less than the limit allowed by the Constitution. In answer to this contention the court says: “The contract was for the furnishing of an article for nightly consumption by the city during a period of thirty years, fixing the price at which the article should be furnished. There was no indebtedness in advance of anything being furnished, but indebtedness arose as gas should have been furnished along from night to night during the period of thirty years. The contract provides for the payment monthly, at the end of each month, the amount that became due for the month then ended. When the company has furnished the gas for a certain month, then there is a liability—an indebtedness arises—and not before, as we conceive. Hence the amounts that might become due and payable under the contract in future years, did not constitute a debt against the city at the time of the entering into the contract, within the meaning of the Constitution.”

The distinction between this and the Howell case is very manifest. Here no liability is incurred until the article is fmnislied from time to time, the consideration being received daily during the entire term of the contract; consequently the aggregate amount that might have to be paid under the contract, if complied with, is not to be taken as creating the indebtedness at the inception of the contract, while in Howell’s case the entire consideration was to be received at once, and to be paid for in the future, thus clearly adding to the indebtedness of the city.

From these decisions we deem the following propositions to he fully established:

First. That a municipal corporation can not become indebted in any manner or for any .purpose beyond the consti- ' tutional limit.

Second. Ho contract, certificate of indebtedness, nor temporary loan, can be valid if it has the effect of increasing the present municipal indebtedness beyond such limit.

Third. Municipalities may, for the purpose of paying their ourrent expenses, anticipate the collection of the revenue appropriated to the payment of such expenses by observing the following requirements:

1st. The tax appropriated must at the time be actually levied.

2d. The warrant drawn upon the treasury in payment of services rendered or articles furnished, must be drawn payable out of this particular fund, and must operate-as a contract, and have the legal effect, between the corporation and the person receiving the warrant, that the corporation shall incur no liability whatever.

Applying these principles to the case in hand the question made is not difficult of solution. The City of East St. Louis was, at the time of entering into the contract, indebted beyond the constitutional limit, and has ever since remained so, as alleged in the declaration and admitted by the demurrer. As the tax contemplated to be levied for lighting the streets had not been levied at the time of making the contract, the contract on the part of the city can have no greater force than an agreement thereafter to levy such tax for the benefit of the other contracting party, which can not be done by the city under the authorities of Springfield v. Edwards; and Law v. The People, supra. The tax not being levied, there was nothing to give in exchange for the gas furnished, and manifestly, if it agreed to pay monthly for the gas furnished for the preceding month, a debt was created against the city within the inhibition of the Constitution.

As was said in East St. Louis v. E. St. L. G. L. & C. Co., supra, “when the company has furnished the gas for a certain month, then there is a liability—an indebtedness arises—and not before.”

It is averred in the declaration that Griswold, after the end of the month of July, rendered his bill for gas furnished during that month, amounting to $509.35, which bill was allowed. by the proper authorities of the city and ordered paid, and that a warrant was issued for that sum payable out of the fund appropriated and levied for street lighting purposes. This warrant was issued September 20th, a date subsequent to the date of the passage of the ordinance levying the taxes.

It is urged that as it was agreed in the contract that Gris-wold would look alone to the fund to be thereafter appropriated and levied, for his payment, no debt was thereby created against the city for the gas furnished thereunder prior to the ievy of the taxes. As we have seen, the contract was entered into before any taxes were levied to meet the respective monthly payments, and by it the city promised to appropriate a sufficient amount of revenue to be derived from taxation to provide for the liquidation of those monthly bills and to issue to Griswold its warrants against such fund.

How it is evident that if the city had failed either to make the appropriation or levy the tax, Griswold could have maintained an action to recover for gas furnished, against the city, except for the constitutional provision preventing it from becoming further indebted.

If the city should violate its contract with him to pay out of a particular fund to be raised through its action by taxation, no reason is perceived why he might not sue and recover against the city generally. This contract, it seems to us, created a present indebtedness at the end of each month, but by agreement, it is to be discharged in a particular way; and if this view be correct, this indebtedness is as clearly within the constitutional prohibition as though it was to be paid generally. The contingency upon which it was to be paid out of a particular fund depended upon the further action of the city. If it neglected to perform its. part of the contract the specified means of payment would fail and it would become a general indebtedness against the city.

Our conclusion upon that branch of the case is, that the warrants drawn upon the treasury in payment of the gas furnished prior to the actual levy of the tax were illegal and void. Those, however, issued in payment for the gas furnished after the tax levy, rest upon a different basis.

It was held in the G.is Light and Coke Company case, supra, that the city had the general power to enter into contracts for the furnishing of gas for city purposes; that such contracts were within the scope of its authority, and, having ■ such general power over the subject-matter of the contracts, the courts should not destroy the contracts made by the parties further than some good reason requires.

There can be no serious ground for contention that, if this contract had been mad after the passage of the general appropriation bill wherein the fund for lighting streets was set aside and specified, and the tax levy had been actually made, it would have been free from legal objection, as it would fall within all the limitations and conditions of the Constitution as construed by the court in the decisions referred to above. The city would then have had something to exchange for the gas furnished.

Having, then, this general power over the subject in question, ' there seems to be no good reason for holding that if, after such tax levy was actually made, Griswold furnished gas, which was used and accepted by the city, the city might not pay for it by warrants drawn against this particular fund, and in determining the amount to be paid therefor, should adopt the contract price for it. This view, we think, is fully supported by the last case above cited, where substantially the same question was raised, and decided in favor of the gas company.

The second question raised upon this record is whether the city can support an action upon the bond in suit for the use of Griswold. The argument is that, as the city is entirely discharged and freed from all obligation to him when it delivers to him the warrant, it has no further interest in the matter ; that Griswold must look to the Treasurer alone for h is payment, and that an action for money had and received against him is the only remedy left to Griswold.

To this proposition we can not give our unqualified assent. It may be, perhaps, that such action would be against Flannigan as Treasurer, but we can not concede that such remedy is exclusive.

The condition of his bond is, that he will promptly account for and turn over to his successor, or other person designated to receive the same, all moneys, etc., coming to his hands, and shall well and truly perform the duties of the office; then the bond is to be void, otherwise to remain in Ml force, etc.

It is averred in the declaration that “said Griswold gave notice to said Flannigan, while he was such Treasurer, and before said money came to the hands of said Flannigan as aforesaid, that he, the said Griswold, would be entitled to said money so to be collected for said fund appropriated for lighting said streets, under his said contract with said city, and presented'to him his said warrant drawn against said appropriation, as aforesaid; and that said Griswold, after said money came to the hands of said Flannigan, and while the latter was still such Treasurer, again presented said warrant to said Flannigan, as such Treasurer, and demanded payment thereof.”

The declaration further avers that there came into his hands as such Treasurer over §2,000, appropriated and collected for the purpose of paying for lighting the streets, against which fund these warrants were drawn. How, as we understand the law this $2,000 was none the less a public fund in the hands of the Treasurer, because it was appropriated, levied and collected as a special fund to be applied in the discharge of current expenses of the city for a special purpose—the lighting of the streets. It was as much the duty of the Treasurer under the law and ordinance of the city to pay legal warrants drawn upon and against this fund as it was to pay general warrants from the general funds of the city.

The levy and collection of this fund was under the general power of the city, and the whole proceedings were had by the same officers and under the same legal authority and power as though it had not by such warrants been assigned to Griswold.

The taxes were levied by competent authority, collected in the usual course and put into the hands of the Treasurer to be paid out upon the legal warrants of the City Council. This he refuses to do; and while the city has not and can not sustain any substantial damages, as no general liability is created, as we have seen, by anticipating the collection of the revenue assessed for a special purpose, it clearly has a right of-action against the Treasurer and his sureties for his failure to perform his official duty in paying oat the funds in his hands accordingly as he should be directed upon warrants of the city legally drawn upon him, when he has in his hands moneys regularly and legally appropriated to the payment of such warrants.

This suit is brought by the city, the obligee in the bond, and the party in which the right of action is vested, and the breach alleged is the failure by the Treasurer to pay a legal warrant drawn against a special fund collected in the regular course of law to meet the expenses of the city in this regard.

The contention that Griswold must sue the city first and obtain judgment is without force. The city has done all that it is required to do. It has levied the tax and it has been collected in the usual course of proceedings'under the revenue laws. It has been received by the Treasurer for a specified purpose and it has been legally drawn against. The duty of the Treasurer is to pay such legal warrants, and the bond in suit is his official pledge that he will perform such duty.

We think this bond is held by the city as a further security •that the Treasurer will perform all his. duties in paying out the funds in his hands to those to whom the City Council, according to the statutes and ordinances of the city, direct payment to be made, and if the Treasurer refuses to comply with his duty, when the means of fulfilling are in his own hands, an action will accrue to the city upon his bond for the use of any party who shows upon the trial that he will be substantially injured by a non-performance of such official duty.

In Hurfree on Official Bonds, Sec. 323, it is said: “It is usually provided in statutes authorizing official bonds to be required of state, county or municipal officers, that suits may be brought upon them in the name of the official obligee ‘upon the relation,’ or ‘to the use’ of the party injured by the breach of the bond or interested in its enforcement. Whenever, however, this express provision is omitted in the statute itself, the deficiency is supplied by the construction given to such statutes by the courts whenever a proper case for such a ruling is presented. In a Maryland case (1858) the court held that it was not necessary for a plaintiff, before instituting a suit upon an official bond payable to the State, to obtain the State’s permission to do so; and this, although there was in the "statute which prescribed the bond no specific provision for making the bond payable to the State, or for giving the party interested the right to sue upon it. The court adds, however, that ‘ there js no doubt that it is incumbent on the party suing on the bond, to show that he has an interest in it, before he could recover in a regular trial prosecuted to verdict.’

“ The rationale of official bonds is well expressed by the court in this case. 8 The laws which provide for the execution of bonds similar to the one before us, do not require them for the purpose of protecting the rights of the State alone. They are also designed to secure the faithful performance of official duties, in the discharge of which individuals and corporations have a deep interest, and, therefore, they should have the privilege of suing such bonds for injuries sustained by them through the negligence and malcouduct of the officers?’”

This doctrine we consider applicable to the bond in suit, and hold that the city can maintain an action upon the bond to recover substantial damages for the use of Griswold,the really injured party, for a failure to pay those warrants really drawn against tin"s particular fund in the Treasurer’s hands, as indicated in this opinion.

The demurrer being general to the whole declaration, where some of the breaches assigned are good, should have been overruled and defendant required to plead.

For the reasons stated the judgment will be reversed and the cause remanded for further proceedings.

Reversed, and remanded.


author: Green", P. J.

text:
    The Consolidated Ice Machine Company v. Anton Kiefer.

      Master and Servant—Dufy of Master—-Reasonable Care—Liability for Causing Death of Servant—Parties Defendant—Joint Liability—Conflict of Evidence—Questions for Jury—Corporations—Stockholder as Witness-Competency of-—Damages—Whether Excessive.

    1. It is the duty of the master to use reasonable care to protect his servant from extra hazard. He should not direct the servant to work in a place which he knows, or might by reasonable care and diligence have discovered to be dangerous.
    2. In the case presented, it was the duty of the defendant company, in the construction o£ its refrigerator plant, to use reasonable care to furnish a support sufficiently strong to bear the weight of a certain tank when filled. The servant on his part assumed only those risks incident to his employment, of which he had express or implied notice.
    3. Where tvzo corporations are co-operating in the erection of a structure, and their successive concurrent negligence causes the death of an employe of one of them, they are jointly liable.

      4. In an action against a corporation to recover damages for causing the death of the plaintiff’s intestate, a stockholder of the defendant corporation is incompetent as a witness as to events prior to the death of the plaintiff’s intestate.
    5. Where the evidence is conflicting in regard to material matters, it is the duty and province of the jury to determine the weight and credit to be given the testimony of the several witnesses.
    6. In cases like the one presented, it is the peculiar province of thé jury to estimate and award, under the evidence introduced, the amount of damages that plaintiff should recover.
    [Opinion filed May 11, 1888.]
    Appeal from the City Court of East St. Louis; the Hon. B. H. Caney, Judge, presiding.
    Messrs. Leo "Bassieutb and W. C. Kueeeneb, for The Consolidated lee Machine Company, appellant.
    The Consolidated lee Machine Company is not liable, unless it could, by the exercise of ordinary care and diligence, have discovered that the support for this tank was insufficient-

      “As respects his duty toward an employe in his service, the employer is not bound to provide absolutely safe machinery. The law imposes on the employer only the obligation to use reasonable and ordinary care and diligence in providing suitable and safe machinery.” Camp Point Mfg. Co. v. Ballou, 71 Ill. 418; Chicago R. R. Co. v. Sweet, 45 Ill. 202.
    “ The law imposes on an employer only the obligation to use reasonable and ordinary care and diligence in providing suitable and safe machinery for the use of their employes.” Kranz v. White, 8 Ill. App. 583.
    “A servant, when he engages in an employment, is "held to have done so with a knowledge of the risk of its ordinary hazards, whether from the carelessness of fellow-servants in the same line of employment, or from latent defects in, or the ordinary dangers in the use of machinery and appliances used in the business.” Richardson v. Cooper, 88 Ill. 273.
    “The law requires of both employer and employe the exercise of sueli a degree of care as under all the surrounding circumstances of the ease a reasonable man would exercise to avoid danger.” C. & A. R. R. Co. v. Mahoney, 4 Ill. App. 262.
    “Where an employe, after having an opportunity to become acquainted with the risks oE his situation, accepts the same, he can not complain if subsequently injured by such exposure.” Chicago, etc., Ry. Co. v. Geary, 104 Ill. 383; Camp Point Mfg. Co. v. Ballou, 71 Ill. 417.
    “An employe can not recover for an injury suffered in the course of the business about which he is employed, from defective machinery used therein, after he has knowledge of such defect, and continues his work without objection.” The Chicago, etc., R. R. Co. v. Munroe, 85 Ill. 25.
    “Although machinery furnished by a railroad company forth e use of its employes may be unsafe, yet if an emjffoye, knowing the character of the machinery, continues- to use it, he is bound to exercise care commensurate with the danger, and if he fails to do so and is injured, his negligence will preclude a recovery against the company on account of such injury.” Toledo, etc., Ry. Co. v. Asbury, Adm’r, 84 Ill. 430.

      “'If a plaintiff by the exercise of ordinary cai-e and prudence might have avoided the consequences of the defendant’s .negligence and failed to do so, he can not recover of the latter for mere negligence.” Abend v. Terre Haute, etc., R. R. Co., 111 Ill. 203.
    “ Should an employe discover that the service has become more hazardous than usual, or than he had anticipated, by reason of defective machinery, etc., the general rule is, lie must quit the service or assume the risks to which he is exposed. ” Missouri Furnace Co. v. Abend, 107 Ill. 51.
    “ The servant seeking to recover for an injury, takes the burden upon himself of establishing negligence on the part of the master, and due care on his part. He is met by two presumptions, both of which lie must overcome.” Wood on Master and Servant, See. 382.
    “ The mere relation of master and servant can never imply an obligation on the part of the master to take more care of the servant than he may reasonably be- expected to take care of himself. And so it is held that where the defects in the machinery are as well known to the servant as the master, the servant must be regarded as voluntarily incurring the risk resulting from its use, unless the master, by urging on the servant, or coercing him into danger, or in some.other way, directly contributed to the injury.” Pennsylvania Co. v. Lynch, 90 Ill. 335.
    Mr. M. Millard, for the Heim’s Brewing Company, appellant.
    The plaintiff here is suing his own master for a breach of duty, and has joined with him another party who was not sustaining that relation to him for the breach of another duty, and the declaration charges these breaches as separate acts of negligence. It does not allege a joint duty and is not based upon the theory of joint action or neglect, and therefore does not show a'joint liability. Instead of charging concerted action it alleges separate conduct, and as the wrongful act of one party rests upon the rights of a servant against Ms master and of the other upon the rights of a person who is in no way related to the wrong-doer, it is clear that these causes of action can not be joined in the same suit. Yeazel v. Alexander, 58 Ill. 254; C. & N. W. Ry. v. Scates, 90 Ill. 586.
    It is plain from the testimony that the accident was caused by a latent defect in the swivel of the truss rod, or hog chain, as some of the witnesses call it. This defect was not seen by anybody, and was not visible to an ordinary inspection. It was perfectly concealed, for the witnesses describe it as a weld ing on the outside, forming a crust or thin skin, while ninety per cent, of the metal did not unite. Nothing, therefore, could render it more latent,
    In such cases there is no liability, because there is no negligence. See Beach on Con. Neg., Sec. 133, citing Malone v. Hathaway, 64 N. Y. 5; Georgia Rd. v. Kenney, 58 Ga. 485; Ladd v. New Bedford R., 119 Mass. 412; Ford v. Fitchburg R., 110 Mass. 240; Ruby v. Steamship Co., 29 La. Ann. 791; Murphy v. Boston R., 88 N. Y. 146.
    Messrs. G. B. Burnett, B. A. Halbebt and Fxannigan & Barter, for appellees.
    Both defendants were acting in concert and co-operating to effect a common purpose—the erection of the refrigerator plant; both, Gohn, Heim’s carpenter, consulting with Dennety, the superintendent of the ice company, were present, and deceased was killed through and by means of their concurring negligence. This brings the case within the rule announced by the Supreme Court in Yeazel v. Alexander, 58 Ill. 254.
    If two or more persons are jointly concerned in a particular act resulting in injury to another, they may be sued jointly. So far has this been carried, that it is held in Massachusetts that one who superintends, although gratuitously, and not under contract, work done on premises of another, and through whose negligence, as well as of such other, an injury occurs, is liable therefor in an action against him and such other jointly. Wharton on Negligence, Sec. 788; Hawkesworth v. Thompson, 98 Mass. 77.
    It is a familiar rule that if the concurrent or successive negligence of two persons combined together, results in an injury to a third person, he may recover damages of either or both. Thompson on Negligence, p. 1088, and authorities there cited. In this case deceased lost his life through the concurring and successive negligence of the ice machine company and the brewing company combined, and the action may be maintained against them, either severally or jointly. W., St. L. & P. Ry. Co. v. Shacklett, 105 Ill. 364.
    If deceased is to be considered as a servant of the brewing company, then the latter could not, by such proof, absolve itself from the absolute duty which the law imposed upon it to furnish safe and sufficient structures and appliances for-doing its work. It could not shift this responsibility upon another servant to whom it had delegated authority to provide the structure, because the act of such servant in providing the structure was in law- the act of the brewing company itself. Hutchinson v. R. R. Co., 6 Eng. Ry. and Canal Cases, 442; Swett v. C. & N. W. R. Co., 45 Ill. 197.
    A direction given to a foreman, which, if followed, would have prevented injury to a servant, is not sufficient in law to exonerate the master from liability. Avilla v. Nash, 117 Mass. 318.
    In all cases the master must show that he in fact adopted such precautions as ordinary prudence suggests, and failing in that, he is liable, although the injury resulted in part from the negligence of a co-servant. Cayzer v. Taylor, 10 Gray 274. If deceased is not to be considered a servant of the brewing company, then his relation to that company was that of one who was impliedly invited by it upon its premises. In such case the duty of the brewing company was to warn deceased of any danger of which the brewing company had knowledge, or of which it ought to have had knowledge, and of which deceased was not aware. Samuelson v. Cleveland, etc., Co., 49 Mich. 164; Coughtry v. Globe Woolen Co., 56 New York, 124. Such being the law, it was not competent for the brewing company to prove that it had instructed its foreman to build a good strong truss, because whether or not it had given such instructions, was wholly immaterial.
   Green", P. J.

Anton Kiefer, administrator of his deceased son, John Kiefer, brought this suit against appellants to recover damages for the death of his intestate, for the benefit of the next of kin.

The negligence alleged as creating the liability, is that the brewing company failed to exercise care in providing supports safe and sufficient to support an iron tank, part of a refrigerator plant, and the ice machine company carelessly and negligently undertook and attempted the erection of the plant and directed deceased, then in its service, to go upon the roof of the engine house of the brewery, when it knew, or by the exercise of ordinary care, and prudence might have known, the supports for said tank were wholly insufficient; and while deceased was upon the roof performing his work as directed, without knowledge of the insufficiency of the supports, the tank, by reason of such insufficiency, fell, taking with it a portion of the roof upon which deceased was then standing, and thereby he was precipitated into the engine house and killed.

It appears by the record that the refrigerator plant was being put up by the ice machine company at the instance of its co-defendant, the latter undertaking as its part of the work to fix the location for the tank and to construct a support for it. The support furnished was a truss, composed of timber, and hog chain underneath, the hog chain consisting of two iron rods anchored one in the north and the other in the south wall of the engine room and joined in the center by a swivel. From, this truss cross timbers were run across and rested upon the top of the east wall, and upon this structure the tank, made of iron, was placed. It fell by reason of the support breaking, and carried with it the portion of the roof on which deceased then stood doing some work on the tank, precipitating him to the floor of the engine house and killing him. lie was a laborer, then in the employ of the ice machine company.

It was the duty of the ice machine company to use reasonable care to protect its servant, the deceased, from extra hazard, and not direct him to work in a place which it knew, or might by reasonable care and diligence have discovered, to be dangerous.

It was the duty of the brewing company in performing that part of the work it had undertaken to do in effecting the common purpose of appellants, the construction of a refrigerator plant, to use reasonable care to furnish a support sufficiently strong to bear the immense weight of the tank when filled. The deceased on his part assumed those risks only, incident to his employment, of which he had express or implied notice. This risk and peril in the performance of the work he had contracted to do, ought not to have been increased by the malfeasance or negligence of those employing him. Wharton on Feg., Sec. 206, 207, 208, 209, notes, and cases cited. The appellants are also to be held liable.for all the consequences which might have been foreseen and expected by them as the result of their acts or omissions. If it is proven the structure erected by the brewing company was being used by its permission, it would be probable the employes of the ice machine company would be obliged to work on or about the tank, and in such employment, if the structure was insufficient and unsafe, it was a consequence to be apprehended that the tank would fall, and carry in its fall and injure those so at work on or aboutit. Weick v. Lander, 75 Ill. 93; Samuelson v. Cleveland Iron Co., 49 Mich. 164; Coughtry v. Globe Woolen Co., 56 N. Y. 124.

It is contended, however, on behalf of appellants, that they are absolved from any liability, because the brewing company used the reasonable care required of it by the employment of competent mechanics and use of suitable, sufficient and good material in the construction of said support, and it broke by reason of a hidden defect in the weld in the swivel, which could not have been discovered by careful examination, and also that deceased was warned by the superintendent not to go upon the roof until the water was let out of the tank, but not heeding the warning, went into the place of danger, and by his own negligence caused his death. In support of these theories, at the trial defendants introduced testimony showing the carpenter employed in erecting said support was competent, the lumber used was fit and suitable, and the hog chain was made by a reputable firm whose business it was to make such appliances. John, the carpenter, also testified for them that, in his opinion, the swivel first gave way, and the timbers broke because of that, and because there was more weight put on them than he was told would be; that the tank weighed more than twice as much as he was told it would; and another thing, the swivel was made of bad iron. On their behalf also, Elliot, manufacturer of frogs and trusses, and a machinist, Beckmann, an engineer and machinist in the employ of the brewing company, Gains, practical worker in iron, Wilson, a blacksmith, Licli, a blacksmith, Meyer, a blacksmith, and Manion, a blacksmith, were called as expert witnesses, and gave as their opinion that the hog chain in question would support a weight much greater than that of the tank when filled, if the weld in the swivel had not been defective, and testified the defect was latent, and attribute the breaking of the truss to this defect.

Three of these experts testify the'only sure way to discover such defect would be a test by putting a weight or strain on the iron. One of the experts, who testified the swivel, if well made and of good material, would stand a strain of 140,-000 lbs., admitted he testified before the coroner’s jury, the swivel, under same conditions, would stand a strain of thirty tons only. Another, who testified the swivel, if properly made, would stand a strain of 80,000 to 100,000 lbs., testified before the coroner’s jury it would stand a strain of twenty to twenty-five tons.

Upon the sécond point the proof, when carefully examined, does not, as we think, establish the fact that deceased was warned of the danger of going upon the roof, or knew, or might have known by seeing the truss as it appeared when finished, that it was unsafe or insufficient. He had been at work for the ice machine.company only about a day and a ha’f, and it does not appear by the evidence he had knowledge or experience enabling him to detect by observation the insecurity of the structure. On behalf of plaintiff, Stith, a laborer in the employ of the ice machine company, and who had worked in a rolling mill for a long time, Toys, a carpenter, who had built trusses for the support of heavy burdens, Ellis, the blacksmith who made the swivel, Dennety, superintending 'the work on behalf of the ice machine company, all testified the truss as constructed, if without defect in material used, was insufficient and not strong enough to support the weight of the tank when filled. The last named witness, who had eight years experience in the construction of refrigerator plants, testified also, that when this support was completed, and before the accident, he called the attention of Heims (who was there acting for the brewing company) to the structure, told him it was not strong enough and would not sustain the tank, and he ought to support it with two additional cross beams and an additional hog chain. It also appears in evidence that Heims, when he gave the order for the hog chain which was used, to the firm who furnished it, did not disclose the use or purpose for which it was to be employed. Bevelot, a witness for plaintiff, testified also that Dennety directed deceased, himself and another employe to go upon the roof to fit up a heater on top of the tank and do some other work there; that such direction was obeyed, and while on the roof the tank fell, and with it the roof and those on it, including Kiefer. Dennety denied giving such direction. It thus appears that Heims was guilty of negligence in not informing the firm which furnished the liog chain of the use for which it was intended, so that care in making it and testing its strength might be insured, and defects in it, if any, thus be detected. This, with all the other evidence in the case, justified the jury in finding appellants guilty of the negligence charged. True, the evidence was conflicting in regard to material matters, but it was the duty and province of the jury to determine the weight and credit to be given the testimony of the several witnesses; these witnesses were before the jury; their manner while testifying, their apparent intelligence,'the means of knowledge disclosed, the discrepancies in their testimony, the probability or improbability of the statements made by them, were means whereby the jury were better enabled to reach a correct finding than we could, and we decline to abrogate the rule adhered to by our Supreme Court in like cases and invade this province of the jury. Shevelier v. Sacger, 121 Ill. 568.

It is further insisted, however, that the defendants can not he held jointly liable, because, as counsel say, “ plaintiff is suing his own master for a breach of duty, and has joined with him another party, who was not sustaining that relation to him, for the breach of another duty, and these breaches are charged as separate acts of negligence.”

We do not so understand the averments or the proof. The appellants were acting in concert, co-operating in the erection of the plant; the brewing company was negligent in providing a structure which was unsafe and insufficient whereby deceased incurred an extra peril when at his work, not incident to his employment; the ice machine company was negligent in directing deceased to work in this place of danger, it having knowledge, and he being without notice or knowledge of such danger, and the successive concurrent negligence of appellants thus united in causing the death of Kiefer.

Persons who co-operate in an act directly causing an injury are jointly liable for its consequences. If they act in concert or if they unite in causing a single injury, although acting independently of each other, they are jointly liable. Shear-man & lledf. on Negligence, Sec. 58; Wharton on Neg., Sec. 788, and notes.

Error is also assigned for the refusal of the court to permit Heims to testify; but it appeared he was a stockholder in the brewing company, a private corporation, and for that reason was an incompetent witness. Thresher v. Pike Co. R. R., 25 Ill. 393.

By the statute he was competent as to any conversation or admission by him, testified to by any witness for plaintiff, and occurring before the death of Kiefer, but the offer by the appellants was a general one to prove by this witness facts, material to the defense, prior to the death of Kiefer, not confining his testimony to any conversation or admission of his prior to such death, testified to by a witness for plaintiff, and the ruling of the trial court was right.

It is also claimed as a sufficient cause for reversal, that the amount of $2,500 awarded as damages, for which sum judgment was rendered, is excessive. It is the peculiar province of the jury in this class of cases to estimate and award, under the evidence introduced, the amount of damages plaintiff pught to recover, and upon an examination of the evidence in this case we are unable to discover that the jury acted improvidently or awarded excessive damages. City of Chicago v. Major, 18 Ill. 349; C. & A. R. R. Co. v. Shannon, 43 Ill. 346; City of Chicago v. Scholten, 75 Ill. 468.

We are satisfied upon a careful inspection of the record there is no substantial error in the ruling of the court below, or in the rendition of the judgment appealed from, requiring its revei sal.

The judgment is affirmed.

Judgment affirmed.


author: Green, P. J.

text:
    The People of the State of Illinois ex rel. v. Board of Education.

      Schools—Division of District—Apportionment of Pupils—Powers of Board—Mandamus—Evidence—Instructions—Bill of Exceptions—■Jury.

    1. It is within the power of a Board of Education to lay off and divide the district into sub-districts, establish therein schools of different grades and apportion pupils to "the several schools.
    2. If, in the exercise of these powers, the rules and orders made are reasonable, necessary and such as will best afford all children of school age within the district the benefits of proper instruction, they will be sustained by the courts.
    3. Upon a petition for mandamus to compel a Board of Education to enroll as pupils in a certain school within the district, the children of the relator, who resided in a sub-district of the same district, it is held: That there was no substantial error in admitting the evidence of a certain witness and refusing to admit a letter of the State Superintendent, nor in giving certain instructions; that objections to remarks of counsel not contained in the bill of exceptions can not be considered; that the children of relator were properly required to attend the school in the sub-district in which he resided; and that he acquired no right to send them to the other school by placing them to board near it and sending them for a few days without the knowledge or consent of the Board.

      Opinion filed January 4, 1888.]
    Appeal from the Circuit Court of Madison County; the Hon. Anos Wat'.s, Judge, presiding.
    Messrs. Dale & Braeshaw and Metoalfe & Metcalfe, for appellant.
    Messrs. Burroughs & Waritook, for appellees.
   Green, P. J.

This was a proceeding by mandamus, to compel said Board of Education to enroll as pupils in the Webster School two children of Frank B. Lemen, the relator, and to admit said children to all the privileges of said school. Issues were made up and submitted for trial to a jury, who found a verdict for defendant, whereupon relator moved to set aside the verdict and for a new trial, which motion the court overruled, and rendered judgment against relator for costs. To reverse this judgment the relator appealed. It appears from the record the said Board of Education set apart certain sections of said district 3 as a sub-district, in March, 1885; that relator, with his family, then resided and continued to reside within the bounds of said sub-district up to and at the time of filing the petition; that a comfortable and suitable school house was provided by said Board, ready for occupation, in the early part of October, 1885, sufficient to accommodate all the children residing in said sub-district entitled to school privileges, including said children of relator, from that time up to and when said petition was filed; that relator sent his said children to said school in October, 1885, and they continued to attend there as pupils (with the exception of four or five weeks’ absence), during the whole of that school year. The distance from the residence of relator to the Webster School, in Collinsville, is four and three-fifths miles; to the Clay school house in the sub-district, by the public road, three and four-fifths miles, and by the route across the fields used by said children one and four-fifths miles.

On Saturday, September 4, 1886, relator took his children to Collinsville to stay with an aunt there and attend the Webster School, which was in School District 3, but not in said sub-district. On September 6th, the first day of the school term, Ralph, the elder of the two children, was placed in room five, and Ames, the other child, was placed in room four by the principal of the Webster School, who did not then know the parents of said children were residents of said sub-district. On September 6th, two members of said Board of Education, visiting the Clay School in said sub-district learned the children of relator were not in attendance there, and returning to Collinsville, found one of them in room four and the other in room five of the Webster School, and directed the principal to take them out and send them to the school where they belonged. This action was communicated to the relator by said principal on September 7th, and on that day, after receiving such notice, the relator interviewed the principal, inquired about the notice, and expressed his wish to send his children to the Webster School, because it was nearer and more convenient. The principal and relator then visited the president of the Board to ascertain if some arrangement could he made to permit said rhildren to attend the Webster School instead of the Clay School, and the president said he would call a meeting of the Board to take action in the matter. On September 8th, such meeting was held, and the record of its proceedings shows the Board met to consider the application of relator to permit his two children to- attend in rooms four and five of the Webster School, and it was ordered “said application be denied, because said children reside in the sub-district of this school district where is situated the Clay School and because of the crowded condition of said rooms of said Webster School,” and it was ordered that said children be assigned for the present term to the Clay School in said sub-district. This action of the Board was communicated to relator within a day or two after the meeting, and on September 15tli relator was again notified by said principal that the Board had ordered his children be not assigned to the Webster School, and if he persisted in sending them there they would bo treated as visitors. The children continued to attend said school for the first five weeks of the term, but received tuition during the first week only, and not after the teachers had notice of the action of the Board. The relator took his children home, and on October 18, 1886, filed his petition. The errors assigned are: First, the refusal of the court to admit a letter from Baah, State Superintendent, to be read on behalf of relator. Second, admitting improper testimony given by Lehr, the principal of the Webster School, on behalf of defendants. Third, giving improper instructions for defendants. Fourth, denying relator’s motion to set aside verdict and for a new trial. Fifth, not awarding the writ of mandamus, and rendering judgment for respondents.

We find, after careful examination of the record, no substantial objection to the ruling of the Circuit Court, either in admitting the*testimony of Lehr and refusing to admit the letter offered on behalf of the relator or in giving the instructions complained of. Under the fourth assignment of error counsel suggest improper remarks were made by defendants’ attorney in his argument to the jury, and that four of the jurors who tried the case were School Directors, hence the verdict should have been set aside. The bill of exceptions does not disclose what remarks were so made, or that any member of the jury w'as a School Director, and unless such objections (if material) are made a part of the record by being preserved in the bill of exceptions, they can not be noticed hv this court

The merits of the case, and the law applicable to the facts proven, will now be considered. It is not objected that defendants acted impro vidently or unreasonably in setting apart the territory embraced in said sub-district, as a sub-district, nor is it proved, or insisted upon, that the children of relator would not have received sufficient and proper instruction, suited to their capacity, if they had attended the school in said sub-district ; hut relator claims that in going to and from that school his children were obliged to go through fields in which grass, clover, etc., was growing, and they would get wet with the dew, and there was a branch or stream they had to cross which became swollen after a rain, and they were in danger of falling in, and in winter, when the snow was deep, were obliged to break a path; in short, that the road was bad and the children’s health liable to be impaired by exposure to said dangers, and hence it was impossible for them to attend. If the testimony in chief, given by the parents, the grandfather and aunt of these children, and the testimony in chief of the two other witnesses for relator who testified touching said matters, is taken by itself, it would support the relator’s objections to sending his children to the sub-district school, and for the reasons so urged by him; hut the facts elicited upon the cross-examination of these witnesses, and the testimony of witnesses given on behalf of defendants, justified .the jury in finding said route to be neither very bad nor dangerous; and that the children of relator in using it were not exposed to greater jeopardy in respect to health or liability to accident than children attending country schools usually are subjected to, who live a like' distance from the school they attend. It also appeared, at the time relator sent his children to the Webster School, room four had a seating capacity for fifty-four pupils, and that fiftysbven, including one child of relator, were then in attendance, and room five had a seating capacity for fifty-two, and there were fifty-five in attendance, including the other child of relator. These children, aged respectively ten and nine years, were present and testified at the trial, thus giving the jury an opportunity to see them and judge as to their physical ability.

But relator further insists that, because he sent these children away from their home and made arrangements to board them with an aunt in Collinsville during the school term, and sent them to the Webster School and received tuition as pupils for a few days, said children acquired a right to attend said school, which defendants could not take away, and could not assign them to the school in the sub-district where their parents resided, and this, notwithstanding defendants neither knew of, nor consented to the removal of the children, and at the earliest opportunity after learning the fact of their attending the Webster School, made an order refusing relator’s application to permit them to attend that school, and assigning them to the school in said sub-district, which action of the Board was communicated to the relator immediately. Such contention receives no support in Rulison v. Post, 79 Ill. 567, cited on behalf of appellant, and we can not hold it to bo the law. The powers given the Board of Education are conferred by the statute, and the following among others:

“ To establish schools of different grades and make regulations for the admission of pupils into the same.”

“ To lay off and divide the district into sub-districts.”

“ They shall have power to apportion scholars to the several schools.” Starr & C. Ill. Stat. 2250. In the exercise of these powers, the rules and orders made by the defendants must not be unreasonable or such as to defeat the wise and beneficent purposes of the school law, and if reasonable, necessary and such as will best afford to all the children in their district entitled to attend public schools an opportunity to receive the benefits of proper instruction, such reasonable and necessary rules and orders should be sustained by the courts. Tested by this rule under the facts proven, the order of defendants refusing permission to relator to send his children to the Webster School, and assigning them to the school in said sub-district, was reasonable and necessary, and a proper exercise of the express power conferred by the statute. The crowded condition of the rooms in the Webster School, and the fact that said children belonged in said sub-district where a good school and competent teacher were furnished, and which they could attend without any considerable inconvenience (as we think the proof shows), justified said order; these defendants could not adapt their action merely to suit the wishes of relator in respect to his children, but their duty required that the rights and interests of the scholars in the Webster School also should be protected, and they he furnished with proper accommodations and seats in their respective rooms. We are satisfied 'the verdict of the jury was supported by the evidence, and that the court properly refused to award the writ prayed for. The judgment is affirmed. Judgment affirmed.