text:
    In re Estate of Mildred N. Sanders, Deceased. LeRoy J. Miller, Trustee Under the Last Will and Testament of Mildred N. Sanders, Deceased, Appellant, v. Helen Sanders Bovey, Appellee.
    Gen. No. 9,449.

      Heard in this court at the May term, 1939.
    Opinion filed February 9, 1940.
    Rehearing denied March 19, 1940.
    E. E. Wingert and Warner & Warner, all of Dixon, for appellant; H. C. Warner and M. C. Pires, of Dixon, of counsel.
    George C. Dixon and Fremont M. Kaufman, both of Dixon, for appellee.
   Mr. Presiding Justice Dove

delivered the opinion of the court.

On May 21, 1919 Mildred 1ST. Sanders executed her will, the provisions of which, so far as are material to this case, are as follows:

“Second. The rest, residue and remainder of my estate of every kind and character, I give, devise and bequeath to my trustee hereinafter named, to have and to hold the same to him and his successors, upon the following uses and trusts:
“ (a) To invest the same as to the said trustee shall seem proper, in Government bonds, first farm mortgages or other equally good securities and to alter and change the investment thereof and for the further execution of the powers conferred by this paragraph he is hereby authorized and empowered to execute and deliver all necessary and proper conveyances, releases or other instruments, and he is authorized to continue to keep my said property in the form in which it may be held by me at the time of my death, if in his judgment it will be to the best interest of the estate so to do.
“(b) To pay all costs and expenses in the management of said estate, including reasonable compensation for his services, all of which shall be subject to the approval of the court having jurisdiction of the administration of said trust estate.
“(c) To apply the income from my said estate toward the proper support, nurture, tuition and education of my daughter, Helen M. Sanders, until she shall reach the age of twenty-four years. The said trustee is hereby authorized to expend such portion of the principal of my estate as in his judgment is necessary for the proper support and education of the said Helen M. Sanders. When the said Helen M. Sanders shall become twenty-four years of age my said trustee shall pay, transfer and deliver to the said Helen M. Sanders all of the said trust estate and property then remaining unexpended.
“(d) The said trustee shall make a report to the court having jurisdiction of this trust estate, at least once in each two years.
“Fifth. I hereby nominate and appoint Clarence W. Lahman executor and trustee of this my last will and testament.
“Sixth. In the event of the death, disability, inability to qualify or serve, refusal to serve or resignation of the said Clarence W. Lahman as testamentary guardian or as trustee or as executor of this will, then I hereby nominate and appoint Ira J. Trostle, of Franklin Grove, Lee County, Illinois, to act as such testamentary guardian, trustee and executor, respectively, as the case may be.
“Seventh. The successors to the said trustee and to the testamentary guardian of my said child Helen M. Sanders, whose appointments are hereinbefore provided for, shall be appointed in the following manner: (a) The said trustee shall in writing appoint a party who will act as succeeding trustee and each succeeding trustee shall have the same power to appoint a successor. Each appointment shall be subject to the approval of the court having jurisdiction of said trust estate. ’ ’

On January 9, 1925 Mrs. Sanders died and her will was duly admitted to probate and Charles [Clarence] W. Lahman qualified as executor thereof. On May 7, 1926, he filed in the circuit court of Lee county his petition reciting that all the claims and costs of administration in the estate of Mildred N. Sanders had been paid and that there remained in his possession as executor one note executed by Clarence Sanders for the sum of $16,000 with interest thereon from March 1, 1926, secured by a first- mortgage on real estate in Bradford township in Lee county and in addition thereto the sum of $442.20 in cash ready to be turned over to a trustee to be appointed by the court. The petition recited that Helen M. Sanders, for whose benefit and use the trust was created, was a minor and that he and Ira H. Trestle, named in said will as trustee and successor trustee, have each executed an instrument refusing to serve as such trustee. The petition then represented that Leltoy J. Miller is ready and willing' to accept the trust, that he is qualified to act in such capacity, that the nearest relative of Helen M. Sanders desires that he be appointed and prays the court to enter an order appointing Miller as trustee. On the same day the court entered an order appointing Leroy J. Miller trustee and fixing his bond at $30,000, which bond was duly presented and approved. On October 21, 1927 LeRoy J. Miller filed his first report as trustee, in which he charged himself with the receipt of $16,000 principal upon the note of Clarence Sanders, together with $800 interest thereon and $480 interest received from the Park Lane Corporation. By this report he recites that he paid the Woodruff Securities Company for Park Lane Corporation first mortgage 6 per cent serial gold bonds the sum of $16,205.33, that he paid the guardian of Helen M. Sanders $967.42 and retained for his services from appointment to the date of the approval of this report the sum of $50, that he paid an attorney for legal services for preparing said report the sum of $10, and showed a balance on hand on October 4, 1927 of $336.30. This report discloses that the trustee had on hand at that time $16,000 par value Park Lane Corporation first mortgage 6 per cent gold bonds and said sum of $336.30 in cash. This report was approved on October 21,1927. On October 5,1928, another report was filed by the trustee, charging himself with the balance on hand on October 4, 1927, the receipt of $960 interest from the Park Lane Corporation bonds, the disbursement of $800 to the guardian of the beneficiary, together with the payment of taxes, the retention of $50 for his services, the payment of $7.50 to an attorney for preparation of the report and a balance on hand of $270.52. This report was duly approved on October 5, 1928. On October 16, 1929 another annual report was presented by the trustee, in which he showed the receipt of $960 interest from the Park Lane Corporation, the retention of $100 for his services, the payment of $500 to the guardian of the beneficiary and the consent to the approval of this report by the guardian of Helen Sanders. This report was duly approved on October 16,1929. On October 22, 1930, another annual report was filed by the trustee showing the receipt of $480 interest from the Park Lane Corporation, together with $1,000 principal from said corporation, and $477.50 interest from the Park Lane Corporation and the State-Bandolph Building Corporation. This report disclosed that at this time the trust estate consisted of $15,000 par value Park Lane Corporation bonds, $1,000 par value State-Bandolph Building Corporation first mortgage bonds and $411.12 cash. This report was approved the same day. A further current report was filed on October 6, 1931 showing a balance on hand of $189.22, which was approved that day. No further reports were filed by the trustee until February 10, 1938 when he filed his final report in which he charged himself with the balance he had on hand on October 6, 1931 of $189.22 and the receipt on December 15, 1931 of $477.50 and took credit for various sums paid Helen Sanders and to her guardian, taxes and other items, leaving a balance of $47.31 on hand. In this report the trustee recited that the Park Lane Corporation became insolvent and that the trustee had in his hands certificate No. 793 for 150 shares in Park Lane Hotel, Inc., which he received upon the reorganization thereof. That the State-Bandolph Building Corporation also became insolvent and he has certificate No. 0698 of the Capitol Building Company for 10 units of beneficial interest therein under the plan of reorganization of said State-Ban-dolph Building Corporation. This report recites that Helen M. Sanders, now Helen Sanders Bovey, became 24 years of age on February 9,1938, that the trust had therefore terminated and prayed for" an order authorizing him to pay her the $47.31 in cash and transfer to her said two certificates and that he then be discharged and the trust declared fully settled.

To this report the beneficiary filed objections which upon a hearing were sustained and the accounts of the trustee surcharged with principal and interest from March 1, 1927 to January 5, 1939, aggregating $20,890.29. The order rendered judgment against appellant for this amount and provided that the trustee, after making such surcharge, may assign to himself individually the two certificates of interest in the Park Lane Hotel, Inc. and the Capitol Building Company as shown by his report. From this order the trustee has appealed.

It is insisted by counsel for appellant that these investments were authorized by the will of Mildred N. Sanders, that a trustee is required only to exercise the same care and prudence which ordinary men would exercise in connection with their own affairs, that after having purchased these securities the retention thereof by the trustee was not improper, that the court authorized the trustee to surrender his bonds, consent to the plan of reorganization and accept the certificates of interest in the reorganized companies and therefore the court erred in charging the trustee for the principal sum which he invested in these bonds, together with 5 per cent interest for a period of six years.

In Merchants’ Loan & Trust Co. v. Northern Trust Co., 250 Ill. 86, it is said that the creator of a trust may designate how the investments may be made, what security may be taken and the trustee will be bound by those directions. The powers of the trustee in the instant case depend upon the terms of the will of Mildred N. Sanders and her intention as expressed in her will must control. This instrument provides that her entire estate was placed in the hands of a trustee until her daughter arrived at the age of 24 years and was to be used for her proper support and education. In order to accomplish this she provided that the trustee should apply the income derived therefrom to those purposes and if, in his judgment, it became necessary to expend a portion of the principal for her support and education the trustee was authorized to do so. When her daughter arrived at the age of 24 years, the trust was to terminate and her daughter was then entitled to receive the corpus of the trust remaining unexpended. At the time appellant was appointed and qualified as trustee on May 7, 1926, there came into his hands as trustee $442.20 cash and a note secured by a first mortgage on a Lee county farm. This note was for the principal sum of $18,000, upon which $2,000 of the principal had been paid and the remaining $16,000 would become due March 1,1927, together with 5 per cent interest thereon from March 1, 1926. On February 28, 1927, the Sanders note amounting with interest to $16,800 was paid and it then became the duty of appellant, as trustee, to invest the principal under the provisions of the instrument creating the trust.

In the instant case there is no doubt that under the provisions of the will creating this trust the trustee was given a discretion as to the securities in which he should confine his investments. If he did not desire to invest in government bonds or first-farm mortgages, he was required to invest in other good securities of equal grade. Did he do this ?

The facts as shown by this record are that appellant at this time was 30 years of age and employed by the Citizens State Bank of Franklin Grove as assistant cashier, that he knew Mildred N. Sanders in her lifetime, knew her daughter Helen, who was then about 13 years of age, knew that her parents were divorced and that the trust fund of which he was trustee was the only fund available for the support and maintenance of Helen and that he had a copy of the will of Mildred Sanders and was familiar with its provisions. According to his testimony the executor of the will of Mildred Sanders, Clarence W. Lahman, told appellant, at the time he qualified as trustee, that it was necessary in order for the trust to produce sufficient income to take care of appellee’s education, care, lodging and keep for the investment to earn six per cent; that Lahman was a wealthy man and told him he was investing his money in Chicago real estate bonds. He further testified that at about the time the Sanders mortgage was paid a prospectus issued by the Woodruff Securities Company of Joliet came to his attention, describing a bond issue of the Park Lane Building Corporation, an Illinois corporation, describing a bond-issue aggregating $1,700,000 secured by a trust deed conveying to the National Bank of the Republic certain real estate located at the southwest corner of Sheridan Road and Surf Street in Chicago. That the security consisted of land owned in fee, improved by a 12-story concrete and brick structure then in the process of construction. That the Corporation had leased the property to the Park Lane Hotel Company. That appellant left the matter of determining what investment he should make of his trustee’s funds to Chas. W. Crum, the cashier of the bank in which appellant was employed. That the bonds were delivered to the bank on approval by mail from the Woodruff Securities Company of Joliet on March 1, 1927 and were delivered personally to appellant by Crum, with the bill attached for $16,205.33. That $16,000 of this amount represented the par value of the bonds and $205.33 the accrued interest, the bonds being dated December 15, 1926, and this is the amount his report of October 21,1927 shows he paid for these bonds.

The uncontradicted evidence is that the price of the Park Lane Corp. bonds when appellant purchased them was not par and accrued interest but 96 and accrued interest. On March 1, 1927, appellant gave his check as trustee on the Citizens Bank for $16,205.33, payable to Woodruff Securities or order. The Woodruff Securities issued its check for $640 and appellant’s individual account in the Citizens Bank was credited with this $640 on March 1, 1927. The evidence further discloses that the stockholders of the Park Lane Building Corporation organized the Park Lane Hotel Company and it operated the building under lease from the Park Lane Building Corporation and that the hotel opened in May, 1927; that the gross earnings for the year ending December 31,1928 was $181,409.38 less than the glittering prospectus had estimated they would be. There was also a large loss in operating the hotel each year during 1929, 1930 and 1931. The record also discloses that only a portion of the 1928 real estate tax was paid and the taxes for subsequent years were not paid prior to December 15, 1931 and the corporation did not set aside funds for their payment as provided by the trust deed. That on December 15,1931, the corporation had $1,667,500 principal amount of the bond issue outstanding, and made default in payment of principal, that a bondholders’ protective committee was formed and a reorganization plan under section 77B of the Bankruptcy Act was approved by the federal court and a final order entered on July 8, 1936 by the provisions of which certificate No. 793 for 150 shares of the capital stock of Park Lane Hotel, Inc. was issued to appellant and is the certificate mentioned in his final report. Appellant, having, in accordance with the order of the circuit court of Lee county, entered on November 30, 1935, deposited his bonds with the reorganization committee.

On December 15,1929, appellant received $1,000 from the Park Lane Corporation in retirement of one of the bonds which he held. On January 4, 1930, appellant drew his check as trustee for $969.47 and procured a draft for $25 or $30 less than that amount and delivered the draft to a representative of Hoagland, Allen and Company, a bonding house in Chicago, and in exchange therefor received a bond of the par value of $1,000 in the State-Randolph Building Corporation. According to appellant’s testimony this $25 or $30 was a handling charge made by the Citizens Bank and that the bank received that amount and not appellant personally. This bond is one of a total issue of $4,500,000 and its payment secured by the land and building- formerly known as the Masonic Temple. The bonds were dated April 1, 1927 and appellant testified that he purchased it upon the recommendation of the representative of Hoagland, Allen and Company which had the bonds for sale and an assistant manager of the credit department of the Continental Illinois Bank and Trust Company of Chicago who wrote appellant on December 9, 1929 to the effect that the appraised value in 1927 of the property covered by the trust deed was $7,077,500, that the property was well located and 90 per cent occupied, that the bonds were in good standing and that the interest and sinking fund requirements had been made to that date, that dealers in unlisted securities had informed the writer of the letter that there was some activity in the bonds and that the present quotations were 92 bid, 97 asked. It appears from the stipulation of the parties and from the evidence in this record that when appellant purchased this bond, the taxes for 1927, amounting to $50,524.02 were unpaid, that the taxes for 1928 amounting to $110,747.10 had not been paid, nor had the taxes for 1929. Their payment was being contested in the courts but the corporation had not made the deposits therefor as required by the trust deed. It further appears that on May 1, 1932, $4,235,100 was outstanding in principal and default was made in the payment of the interest due that date and a bondholders’ protective committee was formed and a reorganization plan formulated which was approved by the federal court on December 23, 1937 and the beneficial interest certificate No. 0698 for 10 units in the Capitol Building Company referred to in appellant’s final report was issued to appellant as trustee.

When we take into consideration all of the many provisions of the trust deeds securing these bonds, we have no hesitancy in holding that they are not such investments as the provisions of the will of Mildred N. Sanders authorized. Appellant was not investing his own money. He should only have taken such risks as a reasonably prudent man would have taken who was charged with the duty of investing money either for himself or for others. He knew that it was of the utmost importance that the principal as well as the interest should be forthcoming at the appointed time. He failed, in our opinion, to exercise the discretion required of him because he invested in the Park Lane Corporation practically the entire trust fund. He invested in an enterprise which was new and untried and whose success had not been established. The probability of the safety of the fund invested and its repayment to him as trustee depended upon the earning capacity of this hotel which was not even completed or opened for business until several months after he had made his investment. Furthermore, the amount he invested was negligible when compared with the whole amount of the bond issues and if default occurred he was helpless to protect his trust estate. He made no personal examination of the security nor sought independent competent advice but was governed largely by the recommendations of those who had bonds to sell. Whether the $640 he received as a result of his purchase of the Park Lane Corporation bonds or whether the $25' or $30 of the purchase price of the State-Randolph Building Corporation bond which went into the earnings of the bank of whiqh he was an officer and a portion of which came to him by way of dividends because he was a stockholder in that bank had anything to do with his decision to buy these bonds for his trust need not be determined. Good faith is the essence of a trustee’s obligation. He must, as has frequently been said, always remember that he is handling a trust fund, the care of which has been entrusted to him in reliance of his integrity, fidelity and sound business judgment. A trustee’s compensation is limited to his legal fees fixed by the instrument from which he derives his authority and the court under whose jurisdiction the trust is being administered. He is not permitted to buy securities for his trust and in consideration of so doing receive 4 per cent of the value thereof for his own compensation. He • cannot so enrich himself. His reports show that he charged and received a reasonable fee for the services he rendered and if his reports had disclosed the true transactions it is needless to say had the matter been called to the attention of the court to which they were presented, they would not have been approved. ‘ ‘ Many forms of conduct permissible in a workaday world for those acting at arm’s length, are forbidden to those bound by fiduciary ties. A trustee is held to something stricter than the morals of the market place. Not honesty alone, bnt the punctilio of an honor the most sensitive, is then the standard of behavior. As to this there has developed a tradition that is unbending and inveterate. Uncompromising rigidity has been the attitude of courts of equity when petitioned to undermine the rule of undivided loyalty by the ‘disintegrating erosion’ of particular exceptions (Wendt v. Fischer, 243 N. Y. 439, 444). Only thus has the level of conduct for fiduciaries been kept at a level higher than that trodden by the crowd. It will not consciously be lowered by any judgment of this court.” Meinhard v. Salmon, 249 N. Y. 458, 164 N. E. 545, cited in In re Estate of Nonnast, 300 Ill. App. 537, 565.

Counsel for appellant argue that no trustee is an insurer of property and if it is shown that he acts in good faith he is not responsible for mere mistakes or errors of judgment as his liability is then limited to loss occasioned only through fraud or neglience. This is true if he acts within the limits of the powers conferred upon him and in the instant case whether or not appellant was authorized to make the investments he did must be ascertained by determining the intention of Mildred N. Sanders as disclosed by her will. By its provisions the trustee was given a discretion. By applying the principle of ejusdem generis to the construction of the investment clause of the will of Mrs. Sanders, the words “or other equally good securities” would limit the trustee to an investment in securities of the same kind and character as government bonds and first farm mortgages. The “first farm mortgage” which the testatrix held at the time she executed her will was dated December 7, 1916 and it was the Clarence D. Sanders mortgage given to secure the payment of $18,000 secured by a first mortgage on a farm located in the county where she lived. She still had this note and mortgage when she died and it was this note and mortgage which finally passed into the hands of appellant and which he collected and invested the proceeds thereof in bonds of the Park Lane Building Corporation. This Sanders mortgage secured only the payment of the note which she held while the bonds secured by the trust deeds executed by the Park Lane Building Corporation and the State-Randolph Building Corporation were held by many. It is true, as counsel for appellant state, that In re Estates of Lalla, 362 Ill. 621 and In re Guardianship of Lutz, 362 Ill. 631, it was held that whether a debt is to a single person or divided among many does not affect the quality of the lien of the mortgage and that a conservator or guardian may rightfully invest his ward’s funds in participating interests in proper securities. An investment of trust funds in a participating interest in one or more first mortgages on land may be a proper trust investment when authorized by the instrument creating the trust but when the language employed by Mrs. Sanders in her will is considered, together with all the facts and circumstances as disclosed in his record, we are in accord with the trial court’s order sustaining appellee’s objections to appellant’s final report.

There is no merit in appellant’s contention that the appellee was guilty of laches, White v. Sherman, 168 Ill. 589, or that she is estopped from objecting to the final report of appellant because the court had approved the ex parte current reports of the trustee, nor can appellant successfully argue that the depression of 1929 was the cause of the loss disclosed by his final report. The depression is said to date from October, 1929, two and one-half years after the Park Lane bonds were purchased. On January 15,1929, the trustee knew or could have known that the corporation in which he had invested practically all of the funds of the trust had not for the two preceding years earned anything like the estimated gross rental upon which he relied in making his investment. When he purchased the State-Randolph Building bond on January 4, 1930 that corporation was already in arrears in the payment of its taxes. The almost total loss of this trust estate may be due in part to the depression but no court can approve of the purchase by the trustee of these particular securities under the provisions of Mrs. Sanders’ will, nor can a court approve any of the actions of the trustee shown to have occurred when these bonds were purchased, nor can we approve of his failure to do anything to properly inform himself after the investments were made and thereby perhaps protect the trust. The trial court charged the trustee with interest at the rate of 5 per cent. Under all the facts disclosed by this record, we feel that 3 per cent is all appellant should be required to pay. The order appealed from will be modified to this extent. In all other particulars it will be affirmed and appellant will pay the costs in this court.

Order modified and as modified affirmed.


source: Caselaw Access Project

author: Mr. Presiding Justice Dove

license: Public Domain

text:
    Daisy E. Davis, Appellant, v. S. T. Oliver et al., Appellees.
    Gen. No. 9,463.

      Heard in this court at the February term, 1939.
    Opinion filed February 9, 1940.
    Rehearing denied March 19, 1940.
    Thomas F. Reilly, of Chicago, for appellant.
    F. B. Bennett and Charles P. Barnes, both of Woodstock, and Henry L. Cowlin and Walter F. Kelley, both of Crystal Lake, for appellees.
   Mr. Presiding Justice Dove

delivered the opinion of the court.

On August 8, 1936, a consent decree in'a foreclosure proceeding pending in the circuit court of McHenry county was entered, from which no appeal was taken. On July 8, 1938, a complaint in the nature of a bill of review to set aside this decree was filed in the circuit court of McHenry county, to which a motion to strike was sustained and the complaint dismissed with leave to the plaintiff to file an amended complaint within 20 days. Within the time specified and on August 11, 1938 an amended complaint was filed, which was stricken on motion of the defendants and an appeal was prosecuted to the Supreme Court, which transferred the cause to this court. Davis v. Oliver, 371 Ill. 287.

From the amended complaint it appears, as stated by the Supreme Court in its opinion, that appellant and her husband were the owners of certain subdivision property consisting of a large number of unimproved lots; that in 1927 and 1928 two deeds of trust were executed to Lynn Richards, trustee, covering most of said lots, to secure one loan of $25,000 and a second loan of $7,662.93; that in 1930 all of the lots described in said two mortgages were conveyed by appellant to the Woodstock State Bank as trustee for the purpose of carrying out the terms of a certain trust agreement known as trust No. 53, by the provisions of which said bank could sell and convey any of said lots and apply the proceeds as specified in the trust agreement. The amended complaint further alleged that in 1931 Richards, as trustee, filed his bill to foreclose the two trust deeds and in that proceeding the Woodstock State Bank as trustee filed a cross-bill setting forth its rights and duties under the trust agreement. That by stipulation between appellant and the holders of the notes under the Richards ’ trust deeds, 52 lots were dismissed from the foreclosure so that the Woodstock State Bank as trustee could complete certain sales of lots under the trust agreement to purchasers thereof and apply the money so received therefrom on the mortgages and for other purposes set out in the trust agreement. The amended complaint further alleged that on December 30, 1929, a suit to foreclose a mechanics’ lien was filed by James Stearns and that thereafter this suit was consolidated with the foreclosure proceeding instituted by Richards, trustee: It is then alleged that on April 4, 1936, the parties to said foreclosure suit met, compromised, agreed and settled the foreclosure suit and entered into a stipulation to that effect by which all the lots covered by the trust deeds except one were to be conveyed by appellant tothe Woodstock State Bank as trustee and all of her indebtedness canceled. The amended complaint then alleges that a decree was presented to Judge Shurtléee at his residence in Ma-rengo and subsequently signed by him and on August 8, 1936 filed with the circuit clerk of McHenry county. It is then alleged that this decree “did not recite the lots covered by the trust deeds or mortgages as provided for by the stipulation of the parties but on the contrary by mistake, inadvertence or fraudulent intent, said decree did recite that Gr. E. Stott and Daisy E. Davis will sign, acknowledge and deliver to the State Bank of Woodstock as trustee a good and sufficient deed of conveyance covering all the premises conveyed to the State Bank of Woodstock, as trustee, by the deed from John W. Davis and Daisy E. Davis to the State Bank of Woodstock, Trustee, bearing date of August 4,1930 and recorded in the Recorder’s office of McHenry County in Book 201 of Deeds at page 250.” It is then alleged that this provision of the decree was wholly different from the settlement agreed upon and the stipulation of the parties in that it directed appellant to convey to the said bank of Woodstock 52 lots which had been dismissed out of said suit according to the former order and in addition thereto required appellant to convey 14 lots which were never covered by the Richards trust deeds. It is then alleged that by reason of the wrongful conduct and practices of the defendants appellant was defrauded and wrongfully deprived of these 52 lots and these 14 lots and the complaint prayed that the decree be set aside and that the State Bank of Woodstock be ordered to convey to the plaintiff or such parties as shall be designated by her all parts or parcels of land not covered by the trust deeds which were foreclosed and that said bank be ordered to account to the plaintiff for any funds received on said lots since April 4, 1936. The defendants in the proceeding are S. T. Oliver, deputy receiver of the United State Bank of Crystal Lake, Illinois, P. F. Rosenthal, Anton Ibels, Gr. D. Crabtree and State Bank of Woodstock, trustee.

Counsel for appellant concedes that the instant proceeding is a collateral attack upon the decree of August 8, 1936 and admits that the court rendering that decree had jurisdiction of appellant and all other parties to that proceeding but, as we understand his argument, insists that as to 14 lots not described in the trust deeds and 52 lots as to which the foreclosure proceeding had been dismissed, the court did not have jurisdiction to make any order concerning them and that the decree so far as these lots were concerned is a nullity.

An examination of the record discloses that these lots (not 14 in number as counsel states but 17 tracts, being 15 full lots and a part of 2 other lots) were described in the cross-bill filed by the State Bank of Woodstock as trustee and were also described in the deed executed by appellant and her husband on August 4, 1930, which conveyed the legal title thereto to the State Bank of Woodstock as trustee. They were also described in the trust agreement executed by appellant and in the declaration of trust and these instruments were attached to and made a part of the cross-bill filed by said bank in said foreclosure proceeding. These lots therefore were before the court and were within the jurisdiction of the court at the time the final consent decree was rendered. As to the 52 lots which were described in the original bill to foreclose as to which an interlocutory decree had been entered dismissing the bill so far as they were concerned, an examination of the record discloses that the amended complaint alleges that the bill was dismissed as to them in order that the bank, as trustee, might be able to carry out contracts which it had made with various purchasers, the interlocutory decree providing that upon payment to the trustee of the balance of the purchase price by the purchaser of any of these lots that then the bank as trustee should convey to such purchaser the lot so purchased.

Regner v. Hoover, 318 Ill. 169, was a bill in the nature of a bill of review seeking to vacate a decree pro confesso rendered by the superior court of Cook county against the plaintiff. The error alleged was that the relief granted was not warranted by the allegations of the bill or prayed in the prayer thereof. In the course of its opinion the court said:

“A bill of review is in the nature of a writ of error and is brought for error of law apparent on the face of the decree and for the purpose of the review. It includes not only the decree but the pleadings and facts as found in the original cause. (Vyverberg v. Vyverberg, 310 Ill. 599; Palenske v. Palenske, 281 id. 574.) An attack on a decree by a bill of review is collateral. The question is not whether the facts found in the.decree under review are in accordance with the pleading and evidence but is one of law. A bill of review cannot be made to function as an appeal or writ of error. (Harrigan v. County of Peoria, 262 Ill. 36.) Remedy for error in the final decree is by appeal or writ of error, and the error to be reviewed by a bill of review must be more than the result of a- mistaken judgment. . . .
“Counsel contends that relief in this case should be granted because, it is argued, the pleadings did not justify the decree. It is evident that the court had jurisdiction of the parties and of the subject matter, and where this is so its decree will not be set aside in a proceeding of this character on the allegation that it is not sustained by the pleadings. That is a question which can be reviewed by appeal or writ of error. Errors which present questions of procedure and not jurisdiction, and do not reach the matter of the right of the court to hear and decide a cause, go only to the question of the correctness of the court’s decision and are not open on a bill of review. Vyverberg v. Vyver-berg, supra.”

In Miller v. Rowan, 251 Ill. 344, the court said:

“A judgment or decree is not binding upon anyone unless the court rendering the same had jurisdiction of the parties and the subject matter of the cause. The court did have jurisdiction of the parties, and the appellant, who is disputing the binding effect of the decree, was one of the complainants. Jurisdiction of the subject matter is the power to adjudge concerning the general question involved, and if a bill states a case belonging- to a general class over which the authority of the court extends, the jurisdiction attaches and no error committed by the court can render the judgment void. If the court has jurisdiction, it is altogether immaterial, when the judgment is collaterally called in question, how grossly irregular or manifestly erroneous its proceedings may have been. The judgment cannot be regarded as a nullity, and cannot, therefore, be collaterally impeached. Such a judgment is binding on the parties and on every other court unless reversed or annulled in a direct proceeding and is not open to collateral attack. If there is a total want of jurisdiction in a court its proceedings are an absolute nullity and confer no right and afford no protection but will be pronounced void when collaterally drawn in question.”

Knaus v. Chicago Title & Trust Co., 365 Ill. 588 was a bill in the nature of a bill of review, having for its object a review of a prior foreclosure proceeding theretofore had in the circuit court of Cook county. In the course of its opinion the court said that the constitution confers on circuit courts original jurisdiction of all causes in law and equity, that jurisdiction of the subject matter is power to hear and determine cases of the general class to which the proceedings in question belong and that such jurisdiction does not depend upon the sufficiency of the bill of complaint, the validity of the demand set forth therein, the regularity of the proceedings or the correctness of the decision rendered and that where a decree is rendered by a court having jurisdiction of the person and of the subject matter, it is not subject to attack in a collateral proceeding. So in the instant case the decree attacked was rendered by the circuit court of McHenry county, which had full jurisdiction of foreclosure proceedings and there is no merit in appellant’s contention that its pronouncements so far as these lots and parts of lots were concerned are not binding* upon the parties to that proceeding.

It is held in Cox v. Lynn, 138 Ill. 195, and numerous other cases that it is indispensably necessary to the sufficiency of a bill of review that a copy of the bill, answer, replication and decree in the proceeding sought to be reviewed should be given and that a synopsis of these files is not sufficient. In the amended complaint in the instant proceeding this was not done. For instance on page 67 of the transcript of the record, the third paragraph of the amended complaint appears and it is as follows: “3. That on the 17 day of October 1931 this plaintiff appeared and filed her answer (to the original bill) in words and terms as follows:” No answer is found and the foregoing allegation is all that appears on this page. At the top of the next page the fourth paragraph of the complaint commences and the cross-bill of the State Bank of Woodstock is set forth in haec verba. Paragraph five of the amended complaint appears on page 127 of the record and is as follows: “5. And thereafter, on the - day of - 193 this defendant filed her answer to said cross bill which said answer was in words and terms as follows:” No answer to the cross-bill is found in the amended complaint. Under the authorities this amended complaint was clearly insufficient and amenable to appellees’ motion to dismiss.

Furthermore, the record contains 193 pages. Counsel’s abstract thereof is less than eight printed pages. It is wholly insufficient and this court, under our rules, would be justified in affirming* the decree for want of a sufficient abstract. Again an examination of the record discloses that at least seven persons who were parties to the original foreclosure proceeding* and parties thereto at the time the consent decree was entered were not made parties to this proceeding.

It is also insisted by counsel for appellant that this decree is void because it was entered at a time and place not authorized by law. There is no merit in this contention. The allegations of the amended complaint are that plaintiff is informed and believes that the attorney for the State Bank of Woodstock appeared before Judge Shurtleff at his home in Marengo on August 7, 1936, pursuant to notice, and then and there presented to him a decree which was signed by him and that this decree was entered in the circuit court of McHenry county on August 8, 1936. This decree is then set forth in haec verba. The decree recites that the cause came on to be heard upon the pleadings of the various parties to the suit, the various interlocutory orders and decrees rendered, upon the testimony of witnesses as well as upon documentary evidence submitted'by the parties. The decree then recites that the court after having ascertained that all the parties before the court have consented to the entry of the decree and have agreed to the provisions and conditions therein found then proceeds to make numerous findings and orders which finally determined the cause.

Other reasons were set forth in appellees’ motion to strike which warranted the court in sustaining their motion which need not be mentioned. The chancellor did not err in sustaining the motion to strike and dismissing the amended complaint and the decree appealed from will therefore be affirmed.

Decree affirmed.


author: Mr. Justice Wolfe

text:
    Henrik Goranson, Appellant, v. Carl Solomonson, Appellee.
    Gen. No. 9,494.
    Heard in this court at the October term, 1939.
    Opinion filed February 9, 1940.
    Rehearing denied March 19, 1940.
    Andrews & Essington and Charles S. Thomas, all of Rockford, for appellant.
    Carl Solomonson, pro se.

   Mr. Justice Wolfe

delivered the opinion of the court.

An action in chancery was brought by plaintiff appellant, Henrik Gorans on, against the defendant ap-pellee, Carl Solomonson, to cancel and annul a contract of employment entered into between them, because the fee required to be paid by the contract for services rendered by said defendant appellee, as an attorney, was so grossly excessive as to amount to a fraud against the plaintiff and was unconscionable. The greater part of this fee was the transfer to said attorney of a large part of capital stock which was the subject matter of litigation in another suit.

The plaintiff filed his complaint and alleged that on the 3rd day of November, 1938, a suit was filed against him by the Rockford Screw Products Co., to enjoin and restrain him from selling, assigning, transferring or disposing of 1,000 shares of capital stock of the said company, and to compel him to first offer said capital stock to the said company in accordance with a certain agreement between the said plaintiff and the Rockford Screw Products Company. The plaintiff further alleged that, on the 10th day of November, 1938,.he conferred with Carl Solomonson, a duly licensed and practicing attorney in Rockford, Illinois, about said suit, and at numerous times thereafter; that he was advised by the said defendant regarding his legal rights in connection with said suit; that he employed the said defendant to represent him in said suit, prior to November 28, 1938; that on November 28, 1938, while the plaintiff was in an intoxicated condition, the defendant secured the signature of the plaintiff to the agreement in which plaintiff should pay the defendant the sum of $500 as an attorney fee, and if the defendant was successful in said litigation, or if the temporary injunction involved in said suit should be dissolved, then the plaintiff should pay an additional fee by the assignment and transfer of 300 shares of capital stock of Rockford Screw Products Co., and that the plaintiff should also pay and advance any and all costs necessary to properly defend said cause; that after said agreement was signed, the said appellant paid to the defendant the sum of $500, and that the defendant made demand on the plaintiff for the sum of $150 for costs, which he, the plaintiff, paid; that shortly after the contract was signed, as aforesaid, he, the plaintiff, did transfer 300 shares of said capital stock of the Rockford Screw Products Co., to the said Carl Solo-monson ; that at the time of the transfer of said stock, it was worth approximately $20 per share.

In his petition, the plaintiff stated what the defendant, Solomonson, did in connection with the injunction suit, and alleges that on December 22, 1938, the Rockford Screw Products Co., voluntarily dismissed its suit. The petition further alleges that the fee charged for such services by said defendant, Solomonson, was so grossly excessive, as to amount to a fraud on the plaintiff ; that such agreement was so unconscionable,' that it was illegal and void. The plaintiff prays that said capital stock now held by the defendant, shall be ordered returned to him, also that the $500 be returned to him and the $150 paid to the defendant, for expenses be returned to him, less such amount as the court finds a reasonable fee for the services rendered by the said Solomonson to the plaintiff.

The cause was heard before the court without a jury, who found the issues in favor of the defendant, so far as the fraud in the contract was concerned, but held that the evidence showed that there had been only $10 expended by the defendant for the costs in the suit, and ordered the balance of $150 to wit; $140 to be returned to the plaintiff. The court entered a decree in conformity with his findings. It is from the entry of this decree that the plaintiff prosecutes his appeal.

The law is well settled that where a fiduciary relation exists between parties, especially as between attorney and client, the utmost good faith must be exercised in all dealings by the attorney to his client. One of the earlier cases is Ross v. Payson, 160 Ill. 349, and on p. 358, we find the following: “Thus it is said in Story’s Equity Jurisprudence, (sec. 310): ‘The situation of an attorney or solicitor puts it in his power to avail himself, not only of the necessities of his client, but of his good nature, liberality and credulity, to obtain undue advantages, bargains and gratuities. Hence the law, with a wise providence, not only watches over all the transactions of parties in this predicament, but it often interposes to declare transactions void which, between other persons, would be held unobjectionable.’ ” In Jennings v. McConnel, 17 Ill. 148, Chief Justice Scates, rendering the opinion of the court, quoted with approval the foregoing language, and said (p. 150): “And this is applicable to contracts or gifts generally, while the confidential relation continues, and is not confined to particular property about which the attorney may have been employed. It is not required that a client should establish fraud or imposition — the onus of proof — upon showing the relation when the contract or gift was made, is upon the attorney to show fairness, adequacy and equity; and upon failure to make proof, courts of equity treat the case as one of constructive fraud.” The doctrine here announced has never been departed from by this court, but often reiterated. Alwood v. Mansfield, 59 Ill. 496; Laclede Bank v. Keeler, 109 Ill. 385; Morrison v. Smith, 130 Ill. 304; Elmore v. Johnson, 143 Ill. 513.

This case has been cited with approval in Ringen v. Ranes, 263 Ill. 11; and Warner v. Flack, 278 Ill. 303, at p. 307, in which it is said:

‘ ‘ The procuring of the conveyances to the defendants from their client was an independent transaction, entered into after the trust deed had been obtained. The demurrer admits that during the existence of the relation of attorney and client the defendants purchased their client’s property. In snch case it is not necessary to show fraud or imposition on the client, but the burden is thrown upon the attorney of proving the perfect fairness, adequacy and equity of the transaction, and upon his failure to make such proof a court of equity will treat the case as one of constructive fraud.”

In the more recent case of Masterson v. Wall, 365 Ill. 102, at p. 110, we find the following: “Where a fiduciary relation exists, the burden of proof is on the grantee or beneficiary of an instrument executed during the existence of such relationship to show the fairness of the transaction, that it was equitable and just and that it did not proceed from undue influence. (Suchy v. Hajicek, 364 Ill. 502.) Allen v. McGill, supra; Rutherford v. Schneider, 307 Ill. 28; Pillsbury v. Burns, supra; Dowie v. Driscoll, 203 Ill. 480.) This rule applies to contracts between client and attorney made during the existence of such relation and afterwards attacked by the client. (Warner v. Flack, 278 Ill. 303; Willin v. Burdette, 172 id. 117; Ross v. Payson, 160 id. 349; Morrison v. Smith, 130 id. 304; Jennings v. McConnel, 17 id. 148.)”

The law is clearly stated in these cases, that if the relation of attorney and client exists, then if a contract is entered into between the parties, that the burden of proof is upon the defendant to show that the same was entered into fairly, and that the client had been advised fully in regard to his rights in the matter.

The dispute in this case is, whether at the time the contract between the plaintiff and defendant was entered into, namely, on November 28, 1938, the relationship-of attorney and client existed. The burden of proof was upon the plaintiff to show that this relationship did exist. The-plaintiff testified that he went to see the defendant on November 10, 1938, which was on Saturday. He went there for the purpose of employing Mr. Solomonson to represent him in the then pending litigation with the Rockford Screw Products Co.; that he discussed the matter with Mr. Solomonson, and went back again on Monday, November 12, and again discussed the matter with him, and further testified as between these dates, and November 28, he had several conversations with Mr. Solomonson in regard to the suit, but that at no time, had he discussed the fees which Mr. Solomonson would expect for his services. Mr. Solomonson claims that he was not employed to represent the plaintiff until November 28, the time the contract was entered into. Mr. Solomonson’s own testimony refutes this claim, because he states in his evidence, when he was called as an adverse witness by the plaintiff, as follows: “I do not recall how much time I spent between November 14, and November 21, investigating the authorities and working on the case of Rockford Screw Products Company vs. Henrik Goran-son. I did not keep a record of the time I spent on this case. My recollection is that I spent almost all of my time on that matter. ’ ’ Later, the abstract shows: ‘ ‘ On November 21, Henrik Goranson and I discussed the possibility of the Rockford Screw Products Company purchasing the stock at a -greater figure than the book value. Between November 21, and November 23,1 discussed the matter with Frank Maynard, who was the attorney for the plaintiff, meaning (Rockford Screw Products Company.) ” If Mr. Solomonson was spending the most of his time in working on the case of the plaintiff from November 14th, to the 21st, and going-over to see the attorney for the Rockford Screw Products Company about the settlement of the matter, it seems clear to us that the relationship of attorney and client existed prior to November 28, 1938. We therefore hold, as a matter of fact, that from November 10, 1938, to November 28, 1938, the relationship of attorney and client existed between the plaintiff, Goranson, and the defendant, Carl Solomonson.

The plaintiff having established that the fiduciary relation of attorney and client existed at the time the contract was entered into, the burden then shifted to Mr. Solomonson to show that it was fairly entered into, and that the plaintiff had been fully advised of his rights before the same was signed. The defendant wholly failed in this proof, as he offered none whatsoever, except his own testimony at the time he was called by the plaintiff, as an adverse witness. There is testimony in the record tending to show that a reasonable fee would be as low as $100. According to Mr. Maynard’s testimony, who represented the plaintiff in the suit against G-oranson, Mr. Solomonson did not spend more than one and one-half hours in court arguing the three motions which he filed to dismiss the suit, and in his opinion, 10 hours would be a reasonable time for a lawyer to prepare himself to defend the suit, and file the motions as filed by Solomonson. Other lawyers in answering a hypothetical question and assuming that Mr. Solomonson put in his entire time from the time that Goranson first called to see him, until the suit was dismissed, placed the fee much higher. Mr. Solomonson is entitled to a reasonable fee for his professional services which he' rendered to the plaintiff. However, the contract as entered into between the parties, was so unconscionable that it amounts to a fraud, as against the plaintiff, and should not be allowed to stand.

It is admitted that the plaintiff paid the defendant $150 as expense money, and only $10 was used for that purpose. The plaintiff would be entitled to the return of $140, as the court properly held in his decree. As to the transfer of the stock, and the payment of the $500, it is our opinion that the decree affirming this contract, should be reversed. It is therefore ordered that the cause be remanded to the trial court with directions to fix a reasonable fee for the defendant for his services rendered to the plaintiff, and .order that the stock in question be returned by the defendant to the plaintiff; that if the fee, as allowed by the court, is less than $500, the remainder of the $500 should also be returned to the plaintiff, but if the fee .is $500, or more, the cash in his hands that has been paid him by the the plaintiff, should be retained by him and applied on his attorney fee.

Reversed and remanded with directions.


author: Mr. Presiding Justice Wolfe

text:
    In re Estate of Rodney A. Wright, Deceased. H. G. Wright et al., Executors of Estate of Rodney A. Wright, Deceased, Petitioners for a Citation, Appellees. Marie Furr, Intervening Petitioner, Appellant.
    Gen. No. 9,455.

      Heard in this court at the May term, 1939.
    Opinion filed February 17, 1940.
    Rehearing denied March 19, 1940.
    Lloyd M. Brown and C. W. Armstrong, both of Chicago, for appellant.

      John K. Newhall, of Aurora, and Cassius Poust and L. Frank Moudry, both of Sycamore, for appel-lees.
   Mr. Presiding Justice Wolfe

delivered the opinion of the court.

At the time of the death of Rodney A. Wright, late of the county of DeKalb, C. D. Thornton, cashier of the DeKalb Trust and Savings Bank, had in his possession, in a safety deposit box of the bank, Certificate No. 397, for 2,000 shares of the common stock of the Northern Illinois Finance Corporation, and also collateral trust notes of the Finance Corporation of the face value of $14,000. All these securities, it is conceded by the parties hereto, at one time were the property of Rodney A. Wright, together with other similar notes of the face value of $6,000. So far as can be ascertained from the record, the certificate and the notes were originally put by Wright in the custody of Thornton, as a means of placing some of his personal property in a place unknown to his wife, and to avoid an injunction obtained by her in a divorce- suit. The certificate for the stock is in the name of P. T. Wright, a brother of Rodney A. Wright, and indorsed by the former in blank. P. T. Wright does not claim any interest -in the stock. The notes were payable to bearer, and were renewed from time to time, and new notes, took the place of matured notes.

On May 23, 1934, the executors of the estate of Rodney A. Wright filed in the county court of DeKalb county, their petition for citation, under section 82 of the Administration Act [Ill. Rev. Stat. 1939, ch. 3; Jones Ill. Stats. Ann. 110.082], alleging that C. D. Thornton had in his possession the certificate and notes; that the Northern Illinois Finance Corporation had in its possession, money in the nature of dividends on the stock all of which, it was alleged in the petition, belonged to the estate of Rodney A. Wright. The petition prayed that the respondents be required to answer the petition, and ordered to deliver the certificate and the notes to the executors.

Rodney A. Wright was a physician. He was in Europe from May to August in 1932. In December 1932, he was ill in the Masonic Memorial Hospital in Chicago. In January 1933, he was a patient in the (Hidden Hospital in DeKalb. Dr. Wright was not in the hospital in March 1933, and sometime between January and March 1933, he was able to be out and attend to his financial affairs. Sometime in March

1933, he went to Prescott, Arizona, where he remained until his death on August 24, 1933. Before 1932, and thereafter until his decease, Wright was deeply in love with Mrs. Marie Furr who resided in Chicago. He wrote to her from Prescott many letters expressing his great love, indeed, infatuation. In some of these letters he discussed business matters and referred to the securities, which are the subject matter of this litigation. The letters disclose that Wright was greatly disturbed by his marital status, and the pendency of the divorce suit against him. The letters reveal that Wright disliked his wife; that he and Marie Furr had kept company and that his tender feelings were reciprocated.

Marie Furr filed an intervening petition in the summary proceeding for citation, claiming as her own by gift inter vivos from Rodney A. Wright, the notes for $14,000 and the certificate for 2,000 shares of stock and the increments and earnings thereof. In her petition, she alleged that the notes and the certificate were given to her by Wright, and that she placed them in a safety deposit box in a bank in Chicago, to which she alone had access; that in January 1933, C. D. Thornton suggested to her that they take the securities to Dr. Wright in the hospital in DeKalb and this was done; that Wright told Thornton in her presence, that the securities were her property and asked Thornton to keep them for her, hut this Thornton declined to do; that in February 1933, with her knowledge and consent, Dr. Wright took the securities to Thornton’s bank and again told Thornton that the secnrities belonged to Marie Furr, and asked Thornton to keep them for her, and he has since kept them in his possession, and now has them as requested by Wright.

C. D. Thornton in his answer to the petition of the executors, admitted that he has possession of the securities, but further states that he neither admits nor denies that they are the property of the estate of Rodney A. Wright; that he is ready and willing to deliver the securities to the person entitled to them, as directed by the court.

In his answer to the intervening petition of Marie Furr, Thornton alleges that he can neither admit nor deny that the securities were given to Marie Furr, or that she removed them and placed them in a safety deposit box in a bank in Chicago', to which she alone had access. He admits that in January 1933, he asked Marie Furr to bring the notes and certificate to his bank in DeKalb, which she did, and he thereupon suggested to her that they take them to Rodney A. Wright at the hospital; that the securities were taken to him, and that Wright, in the presence of Thornton and Marie Furr, told him that the securities were the property of Marie Furr, and asked him (Thornton), to keep them for her, but that he declined to do so. In his answer, Thornton denies that in February 1933, Wright with the consent and knowledge of Marie Furr, brought the securities to Thornton, and told him that they were the property of Marie Furr and asked him to keep them for her, or that he has them now for her. Further answering he says that on or about March 1933, Wright called at the DeKalb Trust and Savings Bank, and delivered to him the securities with instructions to deliver them to Marie Furr at her request.

There was a hearing before the county judge on the petitions and answers, and the intervening petition of Marie Furr. The testimony in the county court was taken in shorthand and later transcribed. The order of the county court finds that the securities are the property of the estate of Rodney A. Wright, and directs the delivery thereof, to the executors. Marie Furr appealed from the order of the county court to the circuit court of DeKalb county, and it was stipulated by the parties, that the circuit judge should read the testimony heard in the county court together with additional evidence to be introduced in the circuit court, and render his decision thereon. The parties reserved the right to object to the competency, materiality or relevancy of the testimony heard in the county court. The circuit court ordered the securities delivered to the executors, and dismissed the appeal. Marie Furr has appealed to this court from the order of the circuit court.

If there is a claim that the delivery of personal property, the subject matter of a purported gift inter vivos, was to a third person for the benefit of the donee, then it becomes necessary to determine in what capacity the property was received by the third person. (Taylor v. Harmison, 179 Ill. 137; In re Estate of Warden v. Pelting, 299 Ill. App. 353.) Delivery of the subject matter of a gift inter vivos is necessary to the validity of such gift. Words of gift are not sufficient, but there must be actual and positive change of possession. Delivery to the agent of the donor, to be by such agent delivered to the donee, is not effectual if the donor dies before the agent has carried out his instructions, as the death of the principal revokes the authority of the agent, but if the donor delivers the property to an agent of the donee and parts with the possession and all right of control over the property, and the agent is invested with the actual possession thereof, the gift becomes complete though the donee does not himself have the manual possession of the property. The possession of the agent is the possession of the principal— the donee. The gift must take effect in praesenti upon delivery of the property if to the agent of the donee. Jennings v. Neville, 180 Ill. 270; (also, Trubey v. Pease, 240 Ill. 513). In the case at bar Thornton, who held the securities at the time of the death of Rodney A. Wright, never delivered the securities to Marie Furr, the claimant of the securities as donee by gift inter vivos from Wright.

The law is well settled that the title to personal property by gift may be passed by delivery of it by the owner to another, as trustee for the donee. In such case, delivery to the trustee is deemed, in law, delivery to the donee, and divests the donor of all control over, or right of title in the property, and the gift is irrevocable. When a trust has been perfectly created it is not revocable by the death, nor at the will of the party who created it. (Taylor v. Harmison, 179 Ill. 137; Telford v. Patton, 144 Ill. 611; Light v. Scott, 88 Ill. 239; Lawrence v. Lawrence, 181 Ill. 248.) It is incumbent on the party asserting the trust to prove it by clear and satisfactory evidence. Whether a trust exists is to be determined from the proof, having in view all the surrounding facts and circumstances, and the intention of the parties, and the proof must be clear and explicit. The words or acts relied upon, as creating the trust, must show clearly and unequivocally the intention of the donor to create a trust. Trubey v. Pease, 240 Ill. 513.

There is no competent proof in this case proving the actual or symbolical delivery of the securities by Rodney A. Wright to Marie Furr, personally with the intention to transfer title thereto. The following statement of the law of gifts is applicable to the above conclusion of ours, and to legal aspects of this case, as the same are disclosed by the evidence.

“It is now well settled by all the authorities that negotiable instruments are subjects of a valid gift without indorsement or written assignment by the payee, if delivered to the donee by the payee, with intent to transfer the title. The burden of proof of the gift is on the donee to prove all facts essential to a valid gift. The essential facts are the delivery of property by the donor to the donee with intent to pass the title, and the great weight of authority is that the proof to sustain the gift must be clear and convincing. (Maxler v. Hawk, 233 Pa. St. 316; In re Bolin, 136 N. Y. 177; Grey v. Grey, 47 id. 552; Chambers v. McCreery, 106 Fed. 364; 45 C. C. A. 322.) Mere possession by one claiming property as a gift, after death of the owner, is universally, we believe, held insufficient to prove a valid gift. The competent proof here shows plaintiff had possession of the notes and certificates a short time before her aunt’s death and claimed title by gift. She was not competent to testify to the circumstances of the gift or what her aunt said and did, and there was no testimony on that question. ’ ’ Rothwell v. Taylor, 303 Ill. 226, 230. It is clear, therefore, that the testimony of C. D. Thornton stating what Marie Furr had told him Wright had said to her about the ownership of the securities, and the giving to her of the key to the safety box in which the securities were kept by Thornton, was incompetent.

The claim of the intervener, Marie Furr, that she is the owner of the securities by gift inter vivos from Rodney A. Wright, must rest on clear and convincing evidence produced by her, that Wright delivered the securities to Thornton with the unequivocal intention to pass the title to the securities to Marie Furr. To complete the gift, it was necessary that there should have been a delivery of the securities to Thornton by which Wright parted with all control over the securities reserving no right to reclaim or repossess himself of them. The delivery must have been absolute, Wright parting with all his present and future interest and control over the securities. The gift could have been made to Thornton for Marie Furr, if made absolute and unconditional, so that the gift would have taken effect at once. (Taylor v. Harmison, supra.)

There is no evidence in the record proving clearly and convincingly that Wright delivered the securities to Thornton and thereby made Thornton the agent of Marie Furr, with Wright parting with all control over the securities absolutely, and making Marie Furr the principal invested with title to the securities and absolute control thereof as owner.

It is contended by counsel for Marie Furr that the trial court erred in not holding that C. D. Thornton was a trustee of the securities for Marie Furr, and that he should have surrendered them to her upon her demand after the death of Eodney A. Wright. It is specifically urged that all the facts and circumstances in evidence prove that when Wright brought the securities to Thornton in March 1933, just before he left for Arizona, he gave them to Thornton to keep for Marie Furr, and to deliver them to her upon her demand, as they were her property, and made Thornton a trustee for Marie Furr, as the donee of a gift of the securities. The question here is: Is the finding of the circuit judge contrary to the manifest weight of evidence that the intervener, Marie Furr, did not prove by clear and convincing proof an unequivocal intention by Wright to create a trust, and thereunder pass the title to the securities to Marie Furr, which intention was accomplished, in praesenti, by a delivery of the securities to Thornton by which Wright parted with all control over the securities reserving no right to reclaim or repossess himself of them. (Coleman v. Halt, 293 Ill. App. 615.)

Early in January, 1932, or shortly prior thereto, Eodney A. Wright told Thornton that he was accumulating considerable cash which he did not want to put in his account, because of an injunction, and he asked Thornton to keep it for him. Thornton refused and said that the only way he would do such a thing would be to rent a safety deposit box in his own name, and give Wright access to it. On January 2, 1932, subsequent to this conversation, and at Wright’s request, Thornton rented Box No. 12 in; the safety deposit vaults of the DeKalb Trust and Savings Bank in his own name, made Wright his deputy to enter the box, and gave both keys to the box to Wright. At that time, Wright had a box in the same bank. Marie Furr had had safety Box No. 355, in that bank, since 1930.

Some time in May 1932, just before Wright was to leave for Europe, he delivered to Thornton collateral trust notes of the Northern Illinois Finance Corporation, of the par value of $20,000 and a certificate for 2,000 shares of common stock of that corporation. Wright then instructed Thornton to place the securities in Box No. 12, and take care of them for him. At that time, he gave Thornton one key to Box No. 12. Upon Wright’s return from Europe in August 1932, Thornton delivered the securities and the key to Box No. 12, to Wright, and Wright took the securities out of the box.

During the month of December 1932, while Wright was in the hospital in Chicago, his office assistant, Mrs. Mordoff, brought to Thornton, at Wright’s direction, collateral trust notes of the Finance Corporation of the par value of $20,000 and the certificate for the 2,000 shares of stock of that corporation, with a key to Box No. 12, and asked Thornton to place the securities in Box No. 12, which he did.

About January 12, 1933, Thornton went to Box No. 12, to remove and renew $11,000 of notes then matured, and found the box empty. He spent about two weeks attempting to locate the securities, but he failed to find them. Thornton did not tell Wright that the securities were missing, because of Wright’s physical condition, although he talked to him about the securities, hoping Wright might indicate, or state where the securities were. Wright told Thornton that the keys to Box No. 12, were in his office safe and he did not tell him that he had given a key to the box to Marie Furr. The Northern Illinois Finance Corporation notified the trustee of the collateral trust, that the notes now in question, were missing and not to pay them on presentation. Miss Quinn, the assistant secretary of the Finance Corporation, was called to the DeKalb hospital on January 13, 1933, by Wright, who inquired of her why he had not received a check for interest on collateral trust notes, which was due on January 8,1933. She told him that the records did not show that the notes were in his name, and that she would take up the matter with the record holder of the notes, the DeKalb Trust and Savings Bank. Wright told Miss Quinn that he could not understand why the notes had not been presented for payment; that they were in his safety box at the DeKalb Trust and Savings Bank; that Thornton had one key to the box and Mrs. Mordoff had the other key. Also, that he was very much in need of funds, as he was under heavy expenses, due to his illness. Wright further discussed with her, dividends paid on his common stock due January 2, 1933, which the Finance Corporation was enjoined from delivering to him.

Some time about the middle of January 1933, Wright called Mrs. Mordoff to his room in the DeKalb hospital, and asked her if she had delivered the notes to Thornton ; and told her that the notes were lost, and that he was disturbed about their disappearance. Mrs. Mordoff told Wright that there was a record of the notes which she had delivered to Thornton; under Wright’s direction she brought the record to him the next day. Wright also sent Mrs. Mordoff to the office of the Finance Corporation to collect interest on the notes, but the agents of the corporation told her that the interest could not be paid, because of the injunction. Wright also told his sister that the notes were lost; that the stock in his brother’s name was for his children.

The evidence shows that on December 20,1932, Marie Furr gained access to deposit safety Box No. 12, at the DeKalb Trust and Savings Bank during the absence of Thornton. Thornton testified that at no time did he deputize Marie Furr to open Box No. 12, nor any other person than Rodney A. Wright.

In February, 1933, at Thornton’s request, Marie Furr returned to him the securities which were taken from Box No. 12. Thornton and Marie Furr took the securities to Wright, who was then a patient in the hospital in DeKalb. Thornton returned the securities to Wright, and told him that he had been greatly disturbed by the disappearance of the securities; that he had endeavored to obtain a surety bond at a cost of $800 to insure the replacement of the value of the securities, but found it impossible to do so. Wright said that he was sorry that the matter had caused Thornton so much concern; that it was unfortunate, as Marie Furr had the right to get the securities, as they were hers; that he had given them to her; she had a right to g*et them; that he had given her a key to Box No. 12, and instructed her to get them. Wright asked Thornton to keep the securities for Marie Furr, but this, he declined to do, and left them with Wright on a table in Wright’s room in the hospital.

About the first of March, 1933, just before leaving for Prescott, Arizona, Wright brought collateral trust notes of the Northern Illinois Finance Corporation of the par value of $14,000 (being renewals of matured notes heretofore mentioned), and the certificate for 2,000 shares of common stock of the Northern Illinois Finance Corporation to Thornton at the DeKalb Trust and Savings Bank. At that time Wright asked Thornton to keep the securities for Marie Furr and deliver them to her at her demand, as they were her property. Wrignt then also informed Thornton that the notes were reduced from $20,000 because he had made a loan of $5,000. Thornton placed the notes to the par value of $14,000, and the certificate in his own safety Box No. 248, and did not use Box No. 12 again.

On March 3, 1933, Wright called at the .office of the Northern Illinois Finance Corporation and inquired of Thomas E. Courtney, the president of the corporation, why his check for interest on notes in question, was for 6 per cent and not 7 per cent. Wright then stated that he was a stockholder of the corporation, and the owner of the notes on which interest had been paid him. Thereupon, he was paid $110 additional interest on his statement that he was a stockholder of the corporation, and the owner of the notes. Before leaving the notes and the certificate with Thornton in March 1933, Wright used some of the notes to the value of $5,000 to make a loan to his brother, Harry.

From Arizona Wright wrote to Marie Furr as follows : “Dale has the fourteen notes right where they were. Loaned five to Harry and have one with me. I do not want anything but that you should have them, Dear; right now would only be 15 for I couldn’t get other 5, but simply had to invest in order to get bigger income for dear it is truly questionable whether or not I’ll ever do another day’s work and I have to have more or be dependent. ’ ’ Wright had consulted a physician in Paris, and it is evident from the record and his letters, that before March 1933, he was not a well man.

Although Wright was in a precarious state of health, and his financial interests were involved in the divorce suit, he was hopeful of the day when he and Marie Furr could be married. His personal expenses were very heavy and he realized that owing to his physical condition, he would be dependent on the interest from the securities, and the principal of some of them for his care. He was not interested in Mrs. Furr’s employment, and did not want to be informed about it. Before leaving for Europe, Wright left his securities with Thornton, and wrote to him as follows: “Hotel Pennsylvania, New York, May 13, 1932. Dale: In the event anything happens to me, permit Marie to get into safety Box No. 12, and taire as her own the $19,000.00 in collateral trust notes of the Northern Illinois Finance Corporation. She has the key. Rodney A. Wright.” Subsequently, he wrote to Marie Furr from Prescott, Arizona, that owing to his illness he probably would not be able to earn his living, and that he would have to invest them for greater return thereon. It also appears from the evidence that Thornton acted as Wright’s confidential agent during the divorce suit, which was pending during all the times the securities were in Thornton’s possession, and that other securities of Wright not now in question, were held secretly by Thornton.

There are no facts in evidence proving* clearly that Wright created a trust for the benefit of Marie Furr by delivering the securities to Thornton with the explicit intention of passing title to Marie Furr beyond recall by Wright. From the facts appearing in evidence, the reasonable conclusion must be drawn that (Thornton was at all times while in possession of the securities, the agent of Wright, and under his instructions ; and that the securities were held by him for an ulterior purpose, rather than an outright, or completed gift to Marie Furr. Under the facts and circumstances appearing in this case, it would be reasonable to draw the inference that Wright did not have the intention to give away the source and means of his support by gift of his assets, which would take effect before his death. We cannot say that the finding* of the trial court that Wright did not make a completed gift inter vivos of the securities to Marie Furr is contrary to the manifest weight of the evidence, and the reasonable inferences to be drawn therefrom.

The executors called Marie Furr under section 60, of the Civil Practice Act [Jones Ill. Stats. Ann. 104.060], as a witness to prove the handwriting* of Rodney A. Wright in one of his letters to her. It is contended by counsel for Marie Furr, that having been called by the executors, her incompetency as a witness under the Evidence Act, was removed and she could testify in her own behalf concerning the subject-matter of the letter. Under the rule, as stated in the cases of Merchants’ Loan & Trust Co. v. Egan, 222 Ill. 494, and Garrus v. Davis, 234 Ill. 326, the disqualification of Marie Furr, as a witness was not removed.

The petition for citation alleged that the securities were the property of the estate of Rodney A. Wright. In the circuit court the petition was amended to read that the "securities were the property of Rodney A. Wright. We are of the opinion that the amendment was properly allowed, and that there is no variance between the allegations of the amended petition and the proof in the case. (Sullivan v. Arcola State Bank of Arcola, 314 Ill. 40; Hansen v. Swartz, 345 Ill. 609.

The order of the circuit court of DeKalb county is affirmed.

Affirmed.