text:
    Middle Western Telephone Company and Ohio Central Telephone Corporation, Appellants, v. United States Fire Insurance Company of New York, Appellee.
    Gen. No. 39,822.
    Opinion filed June 29, 1938.
    Rehearing denied July 12, 1938.

      Howard A. Brhndage, of Chicago, for appellants; Austin J. Doyle, of Chicago, of counsel.
    Sam:uel Levin, of Chicago, for appellee; Harry B. Begley, of Chicago, of counsel.
   Mr. Presiding Justice Hebel

delivered the opinion of the court.

This is an appeal by the plaintiffs from a judgment entered for the defendant upon the finding of the court at the close of the plaintiffs ’ case.

The action was to recover the unearned premiums at the time a certain fire insurance policy issued to the plaintiffs was canceled by the defendant insurance company. No questions have been raised as to the pleadings, but the question involved is largely one of fact, and from the facts it appears that the Middle Western Telephone Company, a holding company, is a corporation organized by virtue of the laws of the State of Delaware, and the Ohio Central Telephone Corporation, an operating company, is a corporation existing by virtue of the laws of the State of Ohio, and that they are the plaintiffs.

The defendant is the United States Fire Insurance Company of New York, which was organized under and by virtue of the laws of the State of New York.

In June, 1930, the plaintiffs, having been solicited by Michael B. Byan, a Chicago insurance broker, commissioned him to procure insurance to cover the properties of the operating company. Byan, as a broker to obtain fire insurance for the plaintiffs, approached Crum & Forster, the defendant’s general agent in Chicago, and arranged for a temporary policy, which he delivered to the plaintiffs together with his own bill in the amount of the premium.

On October 4, 1930, the regular policy, with term commencing as of that date was ready for delivery and was turned over by the defendant’s general agent to the broker Byan for delivery to the plaintiffs. Ryan delivered the policy to the plaintiffs, together with his own credit memorandum in the amount of $2,-009.58 on the temporary policy, which had been canceled, together with his own bill in the amount of $1,-407.73, thereby aggregating an annual premium of $3,-417.35, so from the evidence it appears that at the time of the delivery of the policy by Ryan from the defendant, the plaintiffs paid to Ryan $3,417.35, the premium for the period for which this fire insurance policy was issued.

Six months later, on April 4,1931, the plaintiffs forwarded this policy to Ryan and ordered him to surrender it to the defendant for cancellation, and it appears from the evidence that there was due $1,706.66 as unearned premium. After four or five months, the plaintiffs, not having received the return premium communicated with the general agent .of the defendant, and by letter from it learned that the return premium of $1,706.66 had been paid to the broker, meaning Michael B. Ryan, who had acted for the plaintiffs in procuring the policy, as well as in having it canceled.

The evidence shows that Ryan, after receiving the money from the plaintiffs in payment of the premium, paid over to the defendant $1,357.86 in four instalments, and upon cancellation of this policy, the amount of the unearned premium of $1,706.66 was credited to the personal account of Ryan. At a conference between the plaintiffs and the broker Ryan, the attorney for the plaintiff took Ryan’s note, payable in six months in the amount of the return premium, less commission, in order, as the broker Ryan testified, “to give me some time to work this thing out ... to save the situation that is here now. ’ ’ At the end of the six months period the note remained unpaid and the plaintiffs thereupon filed this suit against the defendant.

The contention of the plaintiffs is that ordinarily an insurance broker is the agent of the insurance company for delivery of the policy and the collection of the premiums, and they cite in support of this contention the case of Ocean Accident & G. Corp. v. Emporia Tele. Co., 139 Kan. 106, decided in 1934, in which the court said:

‘ ‘ The only question before us is whether the broker, St. Clair, was authorized to receive payment of the premium. A broker is, of course, the agent of the person who employs him. For purposes which are not in conflict, and when authorized to do so, he may represent both parties to a transaction. Defendant requested the broker, St. Clair, to procure for it certain insurance, and thereby made him its agent for that purpose. A broker so employed usually is regarded as the agent also of the insurer for the purpose of delivering the policy and collecting the premium. ’ ’

The answer to plaintiffs ’ contention is that the decisions of this State are not in accord with what was said by the Supreme Court in Ocean Accident & G. Corp. v. Emporia Tele. Co., 139 Kan. 106, for it appears from an examination of the authorities that as to whether the insurance broker is the agent of the assured or the insurer, is generally a question of fact to he considered.

In the case of Lycoming Fire Ins. Co. v. Rubin, 79 Ill. 402, the court on the question of an agent’s act, stated:

“This supposed agent is a Mr. Ludlum, who was not at that time, nor at any other time, the appointed agent of this [insurance] company. He was a man in the habit of picking up, as a broker on the street, any risk of which he might get information. It was on his application to appellee [assured], to permit him to place some insurance for appellee, that the policy was written. He never made any examination of the stock at any time; he merely looked into the ‘show case,’ where he saw some watches, some chains, and some plated forks; saw no invoices, but took the value from representations and figures made by appellee, which appellee had ready to show him on the second visit he made to him. After this showing, Ludlum took the application to the agent of the company, and obtained the policy in question. In this, he was the agent of appellee and not of [the insurance company] appellants. The fact that the agent allowed him a commission does not change the character in which he acted.” Applying the quoted portion of the opinion to the instant case, the fact that Ryan was allowed commissions does not change the character in which he acted. See also Merchants’ Ins. Co. of Newark v. Union Ins. Co. of San Francisco, 162 Ill. 173; Ben Franklin Ins. Co. v. Weary, 4 Ill. App. 74; Kings County Fire Ins. Co. v. Swigert, 11 Ill. App. 590; Security Ins. Co. v. Mette, 27 Ill. App. 324. These cases, in principle, approve, the character of the agency as applied to Ryan, that is, when Ryan received the policy delivered to him by the insurance company he still was the agent of the plaintiffs at the time he accepted the money for the premiums due the company, and as we have previously stated, was authorized to receive the unearned premium when the plaintiffs turned over the policy to him to be canceled.

There is no controverted question of fact. The evidence establishes that Ryan, the broker, acted for the plaintiffs in directing the insurance company to cancel the policy, and the plaintiffs would be entitled to a return premium, after allowing the insurance company to retain the earned portion of the premium it had received.

Just what is meant by the credit given to Ryan for the unearned premium amounting to $1,706.66 is not altogether clear from the evidence in the record — whether Ryan retained this sum as his commission at the time the policy was delivered and therefore a credit was allowed him for this amount in order that the books of the company might show that the earned premium, together with the commission, equalled $3,417.35. The question then arises whether the liability of Ryan for this amount, which he admits he received and did not return to the plaintiffs, would bar the plaintiffs in this action by their acceptance of a note signed by Ryan and secured by collateral securities delivered by Ryan. The rule is well settled that if an agent acts for his principal outside the scope of his authority, the principal is not bound thereby, yet the principal may ratify such act and thus render it obligatory upon him. The facts do not disclose that the insurance company received more than the earned premiums it had at the time cancellation was directed by Ryan, the agent of the plaintiffs. The record also establishes that Ryan received the benefits of a sum of money — called the unearned premium — which he failed to pay to his principal. With the knowledge of the facts as they appear in the record, the principal proceeded to take credit from the agent, which was the note secured by collateral for the amount the agent had failed to return to his principal, and having all the facts in hand, and taking the steps they did, it is but reasonable to conclude that the principal ratified the act of the agent in the collection of the amount the agent acknowledged lie had received, and which was evidenced by the note. Applying this rule to the facts as they appear in the record, the plaintiffs having accepted the security and ratified the agent’s act, they are not now in a position to retain the security and the collateral attached to the note of the agent Ryan and sue the defendant to recover the amount of the unearned premiums retained by the agent Ryan.

For the reasons stated the judgment is affirmed.

Judgment affirmed.

Denis E. Sullivan and Hall, JJ., concur.


source: Caselaw Access Project

author: Mr. Presiding Justice Hebel

license: Public Domain

text:
    Henry R. Levy, Appellee, v. Edward G. Blonder et al. Appeal of Edward G. Blonder et al., Appellants.
    Gen. No. 39,900.

      Opinion filed June 29, 1938.
    Hirsch E. Soble and Abraham W. Brussell, both of Chicago, for appellants.
    I. B. Lipson and A. C. Lewis, both of Chicago, for appellee.
   Mr. Presiding Justice Hebel

delivered the opinion of the court.

This is an appeal brought jointly and severally by Edward Gr. Blonder, Samuel Rosen and the Chicago Title and Trust Company, a corporation, as trustee, defendants below, from a decree entered by the court in a foreclosure proceeding.

The plaintiff instituted proceedings to foreclose a mortgage executed by the defendant Edward Gr. Blonder to secure an indebtedness of $50,000, wherein Edward Gr. Blonder was the principal debtor and the defendant Samuel Rosen guaranteed the payment of this indebtedness. The Chicago Title & Trust Company, as trustee, was named defendant, and other persons claiming an interest in the said premises were also named as defendants. To the plaintiff’s complaint the defendants, Edward Gr. Blonder and Samuel Rosen filed a joint answer, admitting, in substance, the execution of the mortgage and the creation of the indebtedness, but setting up the defense of usury and alleging tender of amount lawfully due the plaintiff. The Chicago Title & Trust Company as trustee filed an answer alleging that it had no knowledge of the facts stated in the complaint. The other defendants in the case were defaulted. Upon the issue made, the case was referred to a master in chancery to take testimony, to file Ms report covering the testimony taken and his findings of fact and conclusions of law. Evidence was heard before the master, and various exhibits were introduced in evidence. The master filed his report, to which the defendants filed objections, which were overruled and permitted to stand as exceptions. These exceptions were heard by the court, and on September 23, 1937, the court entered a decree overruling the exceptions of the defendants Edward Gr. Blonder and Samuel Rosen and sustaining the exceptions filed by the plaintiff. The court in its decree made various findings of fact, among others, that there was no usury in the making of the loan; that the defendant Edward Gr. Blonder had failed to make payments of interest and principal in accordance with the terms of the loan; that defendants Edward Gr. Blonder and Samuel Rosen pay the expenses and costs of the foreclosure proceedings; ordered a sale of the premises to satisfy the lien of the mortgage; provided for the entry of a deficiency decree against the defendants Edward Gr. Blonder and Samuel Rosen in the event the sum realized by sale of the premises was not sufficient to satisfy the mortgage, and it is from this decree that appeal is taken.

No point is made as to the pleadings filed by the parties to the controversy.

One objection made by the defendants to the court’s entry of the decree is that the evidence discloses that the loan made by plaintiff Levy to the defendant Blonder was usurious in that Levy intended to and did exact an interest rate of return of more than 7 per cent on the money loaned to Blonder by demanding and obtaining a commission of $1,800 at the time of making this new mortgage and loan in the face amount of $45,-000, and at the same time demanding and obtaining the sum of $150 as purported attorney’s fees for his own use1 and benefit, in addition to the 6 per cent interest rate as reserved in the instrument of indebtedness requiring prepayments of $2,000 semi-annually with the last prepayment being in the sum of $1,000 and interest payments semi-annually.

There is evidence that the sum of $150 was received by Levy, and that the arrangement with regard to allegedly turning over the $150 to Attorney Joseph A. Grolde was a device or makeshift to cover up the exaction by Levy of more than the maximum interest permitted by law.

As to whether $150 attorney’s fees amounted to usury, the plaintiff in his answer makes the statement that this is a question of fact; that both the master, who heard the testimony, and the chancellor, who reviewed the record, have found against the defendants on this factual question. The second point made by the defendants is one of law. The master in chancery instead of prorating the $1,800 advance interest over the entire period, charged it against the first year alone and on that basis found the loan to be usurious. The chancellor in his decree made this finding: “At the time of making said loan the defendant Edward Gr. Blonder, paid to the plaintiff, Henry R. Levy, the sum of $1,800 as a commission for making said loan, and that said sum, together with interest reserved by said note and trust deed, did not exceed 7 per cent per annum for the period of said loan, and that no usury was in fact charged, exacted or paid, and that it was not the intention of the parties to charge, exact or pay interest at a greater rate than 7 per cent per annum.”

It appears from the facts that the defendants were indebted to the plaintiff in the sum of $50,000; that the note evidencing the indebtedness had matured; that an extension was desired, and that an extension was finally agreed upon by the parties. During the negotiations for this extension the plaintiff referred the matter to his attorney, Joseph A. Golde, who took up negotiations for an agreement, prepared a draft of the necessary papers and passed upon the title, and it appears that the defendant Blonder both orally and in writing agreed to pay the charge of the attorney. At the close of the transaction $150 fee was agreed upon between the defendant and Mr. Golde. The defendant Blonder executed his check for $150, payable to Henry R. Levy, the plaintiff. On the back of the check Blonder wrote: “My share of attorney’s fees.” This check was delivered to Mr. Golde and was by him mailed to the plaintiff with the request that the plaintiff issue his check for this sum in payment of the fees. Subsequently a check for $150 was mailed by the plaintiff to Mr. Golde, Ms attorney.

From the facts as they appear, and evidently the court considered the question, it seems but reasonable to conclude that this $150 attorney fee was paid to Mr. Golde by the plaintiff upon receipt of defendant Blonder’s check for $150. There seems to be no real dispute about this. From anything we have been able to find in the record we cannot conclude that this payment of $150 for attorney’s fees was for the purpose of avoiding the usury law, and we believe in this respect the court did not commit error.

As to the second contention of the defendants, that is, that the payment of $1,800 to the plaintiff as interest in advance on the 5-year loan was usurious, from the facts as called to our attention by the plaintiff, the defendant was indebted to the plaintiff — about which there is no doubt — and the loan was secured by a real estate mortgage; the mortgage was about to mature and the defendant desired an extension of the loan in the sum of $45,000. During the negotiations it appears that $2,000 semi-annual prepayments were agreed upon, with interest at 6 per cent. The proof shows that the plaintiff called Mr. Wolter, his secretary, into his office and asked him to compute the amount of commission so that the interest charge, including the commission, would be 7 per cent. The matter was then referred to the plaintiff’s attorney, and after further negotiations the papers were drafted and executed. It also appears that in the course of time correspondence was had regarding the payment of the loan, which correspondence appears in evidence, and in which the matter of illegal interest or usurious interest was never mentioned.

The plaintiff contends it has long been established in Illinois that taking interest in advance does not constitute usury if the interest reserved plus that contracted to be paid when prorated over the entire period for which the loan is to run does not exceed the highest rate allowed by statute.

Upon the question of rate of interest allowed, ch. 74, entitled Interest, sec. 4 (Ill. Rev. Stat. 1937 [§ 4; Jones Ill. Stats. Ann. 67.04]), provides:

“In all written contracts it shall be lawful for the parties to stipulate or agree that seven (7) per cent, per annum, or any less sum of interest, shall be taken and paid upon every one hundred (100) dollars of money loaned or in any manner due and owing from any person to any other person or corporation in this state, and after that rate for a greater or less sum, or for a longer or shorter time, except as herein provided ; . . .” And further, sec. 5 [Jones Ill. Stats. Ann. 67.05] provides:

“No person or corporation shall directly or indirectly, accept or receive, in money, goods, discounts, or thing in action, or in any other way, any greater sum or greater value, for the loan, forbearance or discount of any money, goods or thing in action, than as above prescribed, except from a corporation, and except, also, in the case of advances of money repayable on demand, to an amount not less than five thousand (5,000) dollars, made and secured as provided in Section 4 of this Act. ’ ’

The defendants rely largely upon the case of First Nat. Bank v. Davis, 108 Ill. 633, and contend that in that case the court held that the taking of interest for more than one year in advance at the maximum rate is prohibited. As we have stated, the plaintiff did take $1,800 in advance upon the extension of the loan in the sum of $45,000, and interest computed at the rate of 6 per cent, after prepayments due semi-annually of $2,-000 each, for the 5-year period of time provided for in the extension, amounts to $10,800, and the interest at 7 per cent per annum for the same period of time totals $12,600, so that adding the $1,800 commission, the total interest at 6 per cent on the loan of $45,000, amounts to $12,600.

The plaintiff contends that The First Nat. Bank v. Davis, supra, is not controlling, and the authorities do not seem to support the contention of the defendants in this regard. In the case of Brown v. Scottish-American Mortgage Co., 110 Ill. 235, the court upon a like question said:

1 ‘ The charge in the answer that there was fraud and circumvention in the loan in charging usurious interest, is very clearly not made out. In the first place, it is not shown that the firm of Daniel H. Hale & Co., to whom the $225 was paid, were the agents of complainant in making the loan. If they were not the company’s agents, but were the agents of Brown, in that transaction, although he might have paid them an amount which, added to the current interest upon the note, largely exceeded legal interest, it would not prove usury in the loan. It cannot concern the lender what the borrower pays to his own agents. (Kihlholz v. Wolf, Ex’x, 103 Ill. 362; Phillips v. Roberts, 90 id. 492.) The burden of proving a transaction usurious rests upon the party alleging it. (Boylston v. Bain, 90 Ill. 283; Kihlholz v. Wolf, Ex’x, supra.) In the next place, at the time this loan was made (July 15, 1875), it was lawful to exact ten per cent per annum interest on money loaned. The note given bears interest only at the rate of nine per cent per annum, and runs for five years. It has been held, and is the well settled law of this court, that it is not usurious to exact the payment of interest in advance. (Mitchell v. Lyman et al., 77 Ill. 525; Goodrich v. Reynolds, 31 id. 490; McGill v. Ware, 4 Scam. 21.) One per cent on $4,500 (the amount borrowed) for five years makes just $225; and so, in any view, interest has not been exacted beyond the rate of ten per cent per annum — the then legal rate. McGovern v. Union Mutual Life Ins. Co., 109 Ill. 151.”

This question was considered by the Supreme Court in the case of National Life Ins. Co. v. Donovan, 238 Ill. 283. The loan there involved was an instalment loan and the question arising similar to the one here. The court said:

“Appellant contends the contract was usurious and that no interest can be collected thereon. To be taken advantage of, usury must be pleaded. Treating the very meager and indefinite answer of appellant as sufficient to raise the question of usury, the contract was not usurious. Collecting legal interest in advance is not usury. (Brown v. Scottish-American Mortgage Co., 110 Ill. 235.) Appellee was entitled by law to charge seven per cent interest, and if the total amount of interest charged, and the commissions received by it, do not exceed seven per cent for the length of time for which the loan was made the loan is not usurious. Seven per cent interest on $750 for one year, $750 for two years and $25,000 for three years amounts to $5,-407.50. Six per cent interest (the amount charged in this case) on said sums for the same period of time amounts to $4,635, to which add $662.50, the total commission (and it appears from the evidence appellee received only one-half of said commission), and the total would yet be $110 less than the maximum interest permitted to be charged. This method of computation to ascertain whether or not a loan is usurious is sustained by McGovern v. Union Mutual Life Ins. Co., 109 Ill. 151. The loan was therefore not usurious.”

In the case of McGovern v. Union Mut. Life Ins. Co., 109 Ill. 151, cited with approval in the case from which we have just quoted, the Supreme Court said:

“It appears, from the evidence, that Boone charged the complainant three per cent commissions for procuring the loan of $43,000 from the life insurance company, making the sum of $1,290, and it is claimed that this rendered the contract usurious. When this loan was made the legal rate of interest was ten per cent per annum when the contract provided for this amount. The loan in this case was for three years, at nine per cent interest. Now, the three per cent commissions only amounted to one per cent per annum, so that if the commissions are regarded as interest, and added to the interest at nine per cent, provided for in the note, the rate would still be only ten per cent, and not usurious. ”

This same question was before the Appellate Court in the case of Chicago Title & Trust Co. v. Kearney, 282 Ill. App. 279. We there said:

“The courts of this State have held that in the last analysis the question of whether a contract is tainted with usury is determined not by the form of the contract employed but by the intention of the parties. Curtis v. LeMoyne, 248 Ill. App. 99; Clemens v. Crane, 234 Ill. 215; Cooper v. Nock, 27 Ill. 301. Moreover, there are well considered cases which seem to sustain complainants’ contention, namely, that where a commission is paid to the mortgagee for the negotiation of a loan, the transaction is not usurious where the interest for the period of the note, plus the commission when prorated over the length of time the note is to run, does not amount to more than the legal rate per annum.” And in this opinion the court quoted from McGovern v. Union Mut. Life Ins. Co., 109 Ill. 151, and on the same question cited with approval the case of National Life Ins. Co. v. Donovan, 238 Ill. 283, and, of more recent date, the case of Council v. Bernard, 319 Ill. 392, where a loan of $50,000 at 6 per cent for a term of 5 years had been made, with an agreed commission of $2,000 and the defense of usury was interposed. This court quoted from the latter case as follows:

“If Bernard made the loan for himself as mortgagee, using his own money, still the transaction would not be usurious, as the interest at six per cent for the entire five-year term, together with the charged commission of $2,000 spread over the same term, only amounts to a rate of interest of 6 8/io per cent, while the legal interest rate that may be charged is seven per cent. It is not usury to withhold a commission for a loan, provided the total amount of interest charged, together with the commission, does not exceed seven-per cent for the length of time for which the loan was made. Hence, it makes no difference whether the loan was made by Bernard for himself, or as a broker.” And further said:

“Under these authorities, we think it must be held that neither this loan, nor the extension of it, may be said to be tainted with usury, in the absence of some evidence tending to show that the provisions of the contract were planned with the intent to evade the statute. There is no such evidence.”'

The plaintiff further calls to our attention that the Supreme Court of the United States in Fowler v. Equitable Trust Co., 141 U. S. 384, has held, as a factual matter, that the decisions of the State of Illinois have construed the usury law, as applicable to this case, to be precisely what the plaintiff contends it is. Upon an examination of the cases decided in Illinois, the court said:

“Whether that doctrine will apply where the loan was for such a period that the exaction by the lender of interest in advance would, at the outset, absorb so much of the principal as to leave the borrower very little of the amount agreed to be loaned to him, we need not say. The present case does not require any expression of opinion upon such a point, for the interest reserved in advance on the loan to Fowler was only three per cent out of ten per cent, and a reservation to that extent, it would seem, is protected by the decisions of the state court. The defense of usury, so far as it rests upon the fact that three per cent of the stipulated interest was taken in advance by the lender, must, therefore, be overruled.”

The defendants have called to our attention a recent decision of the Supreme Court entitled Watt v. Cecil, 368 Ill. 510. From an examination of the opinion of the court, it appears that the question involved was whether the amount charged for interest was a violation of the usury statute, and the court said in part: “The interest on $23,000 at six per cent for the period, together with the alleged premium of $1,250, is larger than the interest on $21,750 loaned at the maximum legal rate of seven per cent for the same time. ’ ’

The loan in the instant case was for a period of five years from the date of execution, so that it depends largely upon the facts whether or not usury is a proper defense. We, however, have reached the conelusion that the facts as they appear in the record do not indicate that usury is involved. Therefore, we believe that the law quoted by this court from the several cases cited is controlling, and that the trial court was not in error when it entered a decree of foreclosure.

For the reasons stated the decree is affirmed.

Decree affirmed.

Denis E. Sullivan and Hall, JJ., concur.


text:
    Gerald G. Barry, Appellant, v. Sarah E. Knight et al., Appellees.
    Gen. No. 39,939.

      Opinion filed June 29, 1938.
    William K. Tell, of Chicago, for appellant; Hirsch E. Soble and Hiram T. Gilbert, both of Chicago, of counsel.
    Harry N. Gottlieb and Walter F. Dodd, both of Chicago, for appellees.
   Mr. Presiding Justice Hebel

delivered the opinion of the court.

This is an appeal by the plaintiff from an order entered by the court dismissing- the plaintiff’s action on defendants’ motion on the ground that the municipal court of Chicag’o had no jurisdiction.

The action instituted by the plaintiff was against the defendants for the foreclosure of a mortgage in the form of a trust deed on real estate executed by the defendant Sarah E. Knight to secure the payment of certain promissory notes now owned by the plaintiff upon which there is due him upwards of $5,000.

The sole question in this case is whether the general assembly has vested jurisdiction in the municipal court of Chicago to hear and determine actions to foreclose mortgages. The plaintiff has called our attention to the following provisions in an act relating to the municipal court of the city of Chicago, under ch. 37, Ill. Rev. Stat. 1937 [§ 356; Jones Ill. Stats. Ann. 108.027] , as fixing the jurisdiction of the court.

First. Section 1 of the Municipal Court Act provides that, “There shall be established in and for the City of Chicago a Municipal Court which shall be a court of record . . . and the jurisdiction of which shall be exercised in the manner hereinafter prescribed.” Second. Section 2 of the Act as amended [Ill. Rev. Stat. 1937, ch. 37, § 357; Jones Ill. Stats. Ann. 108.028] , provides that the court shall have jurisdiction in the following cases: “All actions on contracts, express or implied, whether implied in law or implied in fact, when the amount claimed by the plaintiff, exclusive of costs, exceeds one thousand dollars ($1,000).” Third. Section 20 of the Act [Ill. Rev. Stat. 1937, ch. 37, § 375; Jones Ill. Stats. Ann. 108.045] provides that,

“The judges of said municipal court shall have power to adopt, in addition to or in lieu of the provisions herein contained prescribing the practice in said municipal court, such rules regulating the practice in said court as they may deem necessary or expedient for the proper administration of justice in said court.” And the plaintiff suggests that this court is to determine from these three provisions, and from them only, whether the municipal court has jurisdiction of an action to enforce the payment of a promissory note secured by a mortgage upon real estate.

It is further suggested by the plaintiff that prior to the adoption of the Amendatory Act of 1931, there were many provisions contained in the original act which prescribed methods of practice which the judges were bound to follow, but after the adoption of the Amendatory Act in 1931, by the operation of Rule 311, which became effective on November 1, 1935, those provisions became ineffective except to the extent that they were not in conflict with the rules adopted by the judges. Rule 311 provides as follows:

“The foregoing rules shall be treated as in lieu of all express provisions of the Act entitled ‘An Act in relation to a Municipal Court in the City of Chicago, ’ approved May 18, 1905, as amended, prescribing the practice in said court as well as all other statutory rules of practice in conflict with said rules and shall then be in force from and after November, 1935. . . .”

Bule 1 of the Municipal Court provides as follows:

“Contract Actions, which shall include all actions on contracts, express or implied, whether implied in law or implied in fact, on which actions ex contractu for the recovery of money, only, could be maintained at common law, as well as all actions in which any equitable remedy or equitable relief is sought for the enforcement of demands for money or personal property, excepting actions hereinafter otherwise classified. ’ ’ And incorporates provisions regarding actions not material to the question involved in this case.

It has been suggested by the plaintiff that the note to Bule 1 must be treated as a part of the rule. It is in part as follows:

“Included in contract actions are not only common law actions ex contractu, but also action for the recovery of money or personal property in which equitable remedies are sought such as actions to foreclose mortgages; to enforce vendors’ or mechanics’ liens; to correct mistakes in written instruments for the payment of money and enforce them as corrected; to enforce specific performance of contracts for the delivery of personal' property, or for the purchase of personal property; to compel accountings; creditors’ bills and all other action to recover money or personal property of which courts of equity have heretofore exercised concurrent jurisdiction with courts of law. The Municipal Court is limited in its jurisdiction to actions for the recovery of money or personal property only, where no independent relief is sought, but for the purpose of recovering money or personal property and securing its payment or delivery to the plaintiff it may adopt equitable methods of procedure and enforce equitable rights, and may in any such actions give the defendant the benefit of equitable defenses.”

It is well to have in mind what the Supreme Court has stated as to the purpose of the Municipal Court Act. In Lott v. Davis, 264 Ill. 272, upon this subject, the court said:

“The municipal court of Chicago was created after the adoption of section 34 of article 4 of the constitution, which, in contemplation of the creation of the court, provided that if the General Assembly should create such a court it might abolish the offices of justices of the peace, police magistrates and constables within the city and limit the jurisdiction of justices of the peace of the county outside of the city to that territory. The primary and leading purpose manifest from the constitutional provision was to create a court with the jurisdiction and functions of justices of the peace and police magistrates and to abolish their offices for the territory within the city. While that was the well known purpose of section 34 and the occasion for creating the court, the General Assembly saw fit to add to the jurisdiction of justices of the peace and police magistrates jurisdiction in certain classes of cases of more importance in which jurisdiction had been exercised by county and circuit courts. This was done under the provision that the jurisdiction and practice of the court should be such as the General Assembly might prescribe, and in the exercise of its discretion the General Assembly did not give to the municipal court all the jurisdiction of any other court except the courts of justices of the peace and police magistrates. If the municipal court is considered in its entirety it is impossible to assign to it a place identical with the grade or class of any other court which now exists or ever has existed. The court goes under the generic name of a city court, but it belongs to a specific class different from the city courts created under the general City Court act, and is created, not as a part of the judicial department of the State at large, but as a local court of the city for the purpose of administering the law within the city. (People v. Hibernian Banking Ass’n, 245 Ill. 522.) It has none of the more important classes of jurisdiction of circuit courts, including the entire chancery jurisdiction, actions for torts where the damages exceed $1,000, as well as ejectment, mandamus, quo warranto and habeas corpus. The municipal court is composite in its nature and jurisdiction, and in the exercise of jurisdiction of the same nature conferred by general laws upon justices of the peace and police magistrates outside of the city it cannot be regarded as of the same class or grade as circuit courts.”

The Supreme Court in the above case indicates the municipal court is composite in its nature and jurisdiction and is not to be regarded in the same class as circuit courts having general jurisdiction, and, using the language of the court, the general assembly “did not give to the Municipal Court all the jurisdiction of any other court. ’ ’ The jurisdiction of the municipal court is dependent upon the action of the general assembly, and therefore can exercise only such jurisdiction as was granted by the legislature.

The plaintiff in discussing’ the question of the jurisdiction of the court, points to the fact that the original Municipal Court Act as adopted in 1905 and amended in 1907, while conferring upon the judges power to adopt rules of practice, contained the proviso that no rule or rules so adopted should be inconsistent with those expressly provided for by the Act. It also gave the Supreme Court a superintending power over the rules adopted by the judges. This so restricted the power of the judges that for 26 years after the court was organized no attempt was made by the judges to prescribe equitable methods of procedure. Plaintiff further contends that by the Amendatory Act of 1931 the description in section 2 of “all actions on contracts, express or implied,” was changed to “all actions on contracts, express or implied, whether implied in law or implied in fact, ’ ’ and the proviso limiting the rule making power of the judges and the provision conferring power upon the Supreme Court were stricken out, and it is then suggested by the plaintiff that the result of these changes is that actions on judgment and actions to recover taxes and penalties'are now within the unlimited jurisdiction of the court and the rule making power of the judges is now unlimited. The plaintiff further suggests that section 19 makes the judges the sole judges of the applicability of the circuit court rules of practice to the practice in the municipal court, and the Supreme Court has held it valid. (Ptacek v. Coleman, 364 Ill. 618.) However, it will be well to have in mind what the court said as to the jurisdiction of the municipal court in this same case, namely:

1 ‘ The Municipal Court act is a special law; the Civil Practice act is general. The latter act expressly repeals the Practice act of 1907, the act of 1913 relating to suits and proceedings against receivers, certain sections of the Chancery act, the Circuit and Superior Court act, the Supreme Court act, the Appellate Court act, the Abatement act, the Injunction act, and all other acts and parts of acts inconsistent with the new legislation.

“We have repeatedly held that a subsequent general law does not abrogate or repeal a former special act intended to operate upon a particular subject, and that if the later statute does not contain negative words it will not repeal the particular provisions of the special law upon the same subject unless it is impossible that both should be enforced.”

On the question of the practice provisions of the Municipal Court Act, the court further stated: “No good reason can be urged why the practice provisions of the Municipal Court act cannot be enforced in that court, leaving the provisions of the Civil Practice act to be enforced in all other courts of record. It does not appear from anything in the Civil Practice act that the attention of the legislature was directed to the Municipal Court act, with the intention to embrace its practice provisions in the general act. On the contrary, the failure to mention those provisions while specifically repealing numerous provisions of several other particular acts tends to show an intention to leave the practice provisions of the Municipal Court act in force. ’ ’

The plaintiff makes the statement that in the case of Ptacek v. Coleman, 364 Ill. 618, the Supreme Court held valid section 19, which, it is claimed, makes the judges the sole judges of the applicability of the circuit court rules of practice to the municipal court. The court in passing upon this section did state:

“Another provision of section 19 that deserves attention is the provision that the municipal court shall be -the sole judge of the applicability to its proceedings of the rules of practice prescribed by law for similar cases in the circuit courts, and its decisions in respect thereto shall not be subject to review except to prevent a failure of justice. No such claim can be here made. The municipal court of Chicag-o is a part of the local municipal government of Chicago. Manifestly, this provision of section 19 and all other practice provisions of the Municipal Court act are a part of the scheme for such local municipal government provided for by the constitutional amendment. It is equally obvious that this particular provision is embraced within the terms of the amendment authorizing the legislature to pass any law (local, special or general), providing such a scheme. The provision was ratified by a referendum, as provided by the amendment, and its validity cannot be doubted. The action of the municipal court in adopting rule 122 can be construed in no other light than as a determination that the rules of practice in circuit courts relating to non-suits are not applicable to proceedings in the municipal court. This it had the right to do, and its action in that respect is final.
“Inasmuch as the Civil Practice act does not apply to the practice provisions of the Municipal Court act, rule 2 of this court is not to be interpreted as applying to those provisions.”

The municipal court was to have jurisdiction within a limited territory. It is, in effect, what also may be termed a court with limited jurisdiction, and, as stated by the Supreme Court in Lott v. Davis, 264 Ill. 272, was “created, not as a part of the judicial department of the State at large, but as a local court of the city for the purpose of administering the law within the city.”

It is apparent that the jurisdiction of the municipal court was fixed by the legislature and approved by referendum. It is also clear that the municipal court cannot confer jurisdiction by rules of court, and the purpose of the note to Bule 1, to which we have referred, was to add further jurisdiction in the trial of causes mentioned in this note to Bule 1.

In this note, it is stated that included in contract actions are not only actions ex contractu, but also actions for the recovery of money or personal property in which equitable remedies are sought. The plaintiff claims that by the amendment to section 2, the legislature in “all actions on contracts, express or implied, whether implied in law or implied in fact,” granted jurisdiction, after approval upon a referendum, to foreclose mortgages, to enforce vendors’ or mechanics’ liens, and to correct mistakes in written instruments for the payment of money and enforce them as corrected. So it is evident by the adoption of Rule 1 the municipal court attempted to assume jurisdiction in the cases we have outlined, and further to assume jurisdiction in actions for accountings, creditors’ bills and in all other actions to recover money or personal property in which courts of equity have heretofore exercised concurrent jurisdiction with courts of law. As far as we are able to determine from the cited authorities, the municipal court cannot by rule enlarge its jurisdiction to try many of the cases that have been suggested by the plaintiff in the brief filed in this cause. And upon the subject of assuming jurisdiction, we find among the several cases cited that of Ptacek v. Coleman, 364 Ill. 618, in which the thought is expressed that the fact that a court of limited jurisdiction may exercise its discretion in the use of rules of practice of a court of general jurisdiction clearly does not substitute, nor authorize that court to substitute general jurisdiction for the limited jurisdiction specified by statute. The rules of the court of general jurisdiction are subject to use only in cases within the jurisdiction of the court of limited authority.

While section 20, as amended in 1931, of the Ill. Rev. Stat. 1937, ch. 37, ¶ 375 [Jones Ill. Stats. Ann. 108.045], confers power upon the municipal court to adopt “rules regulating the practice in said court,” and further provides that such rules may be “in addition to or in lieu of the provisions herein contained prescribing the practice in said Municipal Court,” it is evident from the language used in the Civil Practice Act that section 19 of the Municipal Court Act with respect to the applicability of Circuit Court Buies, is specifically limited to practice, and the municipal court in seeking to assert jurisdiction in a proceeding to foreclose a mortgage on real estate cannot by its rules assert such jurisdiction.

It is contended by the defendants that the municipal court by statute is vested with specified and enumerated powers, and may not exceed those powers. An issue as to whether it. has exceeded such powers does not present a like case to an issue as to the scope of jurisdiction of the circuit court, and it is contended further that the court cannot, by rule or otherwise, increase its statutory powers, and no presumptions will aid any effort so to increase them.

This theory of the defendants is supported by the case of Gottlieb v. Crowe, 368 Ill. 88, where the court said: ‘ ‘ The inherent power to determine the existence or nonexistence of jurisdictional facts is an attribute which is essential to the functioning of every court. On the other hand, no court can expand its statutory or constitutional powers by a recital that it has jurisdiction of the subject matter. One act requires the determination of a fact which the court has power to determine; the other would be drawing a legal conclusion which the court would be barred from drawing by the statute or constitution which created it. If courts could not determine the necessary jurisdictional facts they could not function, and, on the other hand, if by a recital they could assume powers not given to them there would be no way, by statute or constitution, to limit their jurisdiction.”

In the recent case of Danoff v. Larson, 368 Ill. 519, the court held that the Municipal Court Act was not intended to give the judges of that court any power to make substantive rules of law, because, this would be a violation of the provisions of the constitution.

As to whether or not the municipal court is an inferior court with limited territorial jurisdiction, the Supreme Court in the case of People v. Municipal Court, 359 Ill. 102, makes this statement: “The municipal court has no jurisdiction in felony cases nor in certain tort cases. It has no general chancery jurisdiction, though it has jurisdiction, by statute, of matters in which the proceedings are by the statute declared to be in the nature of chancery proceedings. The municipal court does not have jurisdiction to enter extraordinary writs, such as imandamus and the like.”

It is to be noted as suggested by the defendants in their brief, that the court limits the above statement to “jurisdiction by statute declared to be in the nature of chancery proceedings.” This statement of the court applies to statutory provisions regarding the writ of attachment, which is explicitly brought within the jurisdiction of the municipal court, and where the execution of the writ explicitly applies by statute to “any lands and tenements in and to which such debtor has or may claim any equitable interest or title. ...” (Ill. Rev. Stat. 1937, ch. 11, sec. 8 [Jones Ill. Stats. Ann. 109.041].) The municipal court was without jurisdiction before 1931, and the amendments to the Municipal Court Act in 1931 did not alter the status of the court, nor did they, either alone or in conjunction with the Civil Practice Act, in any manner, directly or indirectly, confer upon it general equitable jurisdiction.

The plaintiff is proceeding upon the theory that the distinction in practice between actions at law or in equity has been abolished by the Civil Practice Act, and, therefore, by the amendment to the Municipal Court Act, the court has jurisdiction in contract actions, express or implied, whether implied in law or implied in fact, when the amount claimed exceeds $1,000, Avhich theory does not add anything to what we consider the intent and meaning of the legislature at the time the amendment was passed.

What the Supreme Court has said in the case of Harty Bros. v. Polakow, 237 Ill. 559, is pertinent because of aid in the meaning of the term “implied contract.” The court said: “The term‘implied contract’ has been used to denote not only contracts implied in fact, — that is, obligations where the mutual intention to contract, although not expressed, is implied or presumed from the acts of the parties or from surrounding circumstances, — but also to denote that class of obligations imposed or created by law Avithout the assent of the party bound, and sometimes even notwithstanding his actual dissent, upon the ground that they are dictated by reason and justice. These latter obligations have sometimes been called constructive contracts or contracts implied by law, — fictions of law adopted to enforce legal duties. (Keener on Quasi-contracts, p. 5; Bishop on Contracts, sec. 205; Hertzog v. Hertzog, 29 Pa. St. 465; 9 Cyc. 242 ; 7 Am. & Eng. Ency. of Law, — 2d ed. — 91; 15 id. 1078; Lillard v. Wilson, 178 Mo. 145; Railway Co. v. Gaffney, 65 Ohio St. 104). This court has held in the recent case of Chudnovski v. Eckels, 232 Ill. 312, that there is no distinction between contracts implied by law from the existence of a plain legal obligation, Avithout regard to the intention of the parties, or even contrary thereto, and contracts implied, in fact, from acts or circumstances indicating the mutual intention; that all alike come within the natural and usual meaning of the words ‘implied contract.’ ”

It is apparent that in actions before the amendment to section 2 was passed by the legislature and approved by referendum, the municipal court had jurisdiction to hear and determine actions on contracts where they were implied in fact and where the court reached the conclusion that it was the intention of the parties to contract, although not expressed. The court also would have jurisdiction before this amendment was passed in actions where “obligations imposed or created by law without the assent of the party bound, and sometimes even notwithstanding his actual dissent, upon the ground that they are dictated by reason and justice. These latter obligations have sometimes been called constructive contracts or contracts implied by law. . . . ” And if the court had jurisdiction in contract actions such as have been indicated, before the amendment of this act, the amendment did not enlarge the jurisdiction of the court.

The plaintiff suggests the provisions of the Civil Practice Act are made applicable to courts other than those of general jurisdiction, and that the Act does not enlarge their jurisdiction so as to make it include cases other than those mentioned in the statute by which their jurisdiction is fixed. It merely permits the municipal court to make use of rules of practice made applicable in courts of general jurisdiction in similar cases. Nevertheless, while the municipal court cannot entertain jurisdiction of any civil action other than one of the class mentioned in section 2 of the Municipal Court Act, it will have the right to entertain any set-off or counterclaim of the kind mentioned in sections 38 and 44 of the Civil Practice Act (Ill. Rev. Stat. 1937, ch. 110 [§§ 162, 168; Jones Ill. Stats. Ann. 104.038, 104.044]) for the purpose of defeating the plaintiff’s recovery.

We have no quarrel with this statement. It is true that the Civil Practice Act does not enlarge the jurisdiction of the municipal court; it only permits it to make use of rules of practice made applicable in courts of general jurisdiction in similar cases. So that in order to have complete jurisdiction in a foreclosure suit it is not alone sufficient that the court enter a decree for the foreclosure of the lien upon the property in question to satisfy the note or bond secured by the trust deed, but in order to do complete justice it is necessary that the court have authority to sell the property, and in a proper case providing for such procedure, the court may be called upon to approve a plan of reorganization presented to it for the purpose of protecting the rights of bondholders who, through their representative, purchased at the sale and subsequently obtained a deed to the property. The court in exercising this jurisdiction must be in a position to enforce the several provisions of the contract, so as to protect the rights of the bondholders who may be interested in the subject matter. This procedure is not similar to an action on a note to recover money. A foreclosure proceeding is for the purpose of satisfying a lien evidenced by a promissory note. In looking at the several angles involved in a foreclosure proceeding, the municipal court is certainly without jurisdiction to carry out the purpose and the approval of a plan of reorganization that may be presented by the several parties interested in securing the greatest return from the property for the benefit of the bondholders. We believe that jurisdiction was not enlarged by the amendment of 1931, adding the words, “whether implied in law or implied in fact. ’ ’

The plaintiff admits that the Supreme Court held in People v. Dummer, 274 Ill. 637, that an action to collect taxes was not an “action on a contract, express or implied,” and was not within the jurisdiction of the municipal court; that in O’Shea v. Farrelly, 302 Ill. 126, it made a similar holding as to an action to recover a statutory penalty; and that in Brown v. Gerson, 182 Ill. App. 177, this court held that an action on a judgment was not an action “on a contract, express or implied,” within the jurisdiction of the municipal court. While admitting the opinions just referred to were contrary to his contentions, plaintiff asserts that they were erroneous and contrary to other opinions of the court. As we have previously indicated, we think the added words, “whether implied in law or implied in fact” do not overcome the effect of the prior decisions of the Supreme and Appellate Courts as to actions on judgments and actions to recover taxes and penalties, and do not lead to an unlimited jurisdiction of the court.

We are satisfied from an examination of the questions called to our attention that the amendment of section 2 of the Municipal Court Act did not grant equity jurisdiction to the court. We are of the opinion that the distinction between law and equity has not been changed, except that by the provisions of par. 259.11 of the Civil Practice Act [Ill. Rev. Stat. 1937, ch. 110, §259.11; Jones Ill. Stats. Ann. 105.11] causes at law and in chancery may be joined in one cause of action and determined by a court of general jurisdiction. This provision does not enlarge the jurisdiction of the municipal court by reason of the amendment of section 2 of the Municipal Court Act.

Having considered the questions we regard ás pertinent upon this appeal, we are of the opinion that the trial court acted properly on defendants’ motion in dismissing the plaintiff’s action upon the ground that the municipal court had no jurisdiction to entertain the suit. The judgment is affirmed.

Judgment affirmed:

Denis E. Sullivan and Hall, JJ., concur.


text:
    Dorothea M. Ruehr, Judgment Debtor and Appellee, for use of Raymond Hurley and Fred F. Gardner, Appellants, v. Continental Illinois National Bank and Trust Company of Chicago and Dorothy M. Ruehr, Appellees.
    Gen. No. 39,954.
    Opinion filed June 29, 1938.
    Leonard & Leonard and Seyfarth & Atwood, both of Chicago, for appellants; Ernest Enoch Freeman and Gordon McLeish Leonard, both of Chicago, of counsel.
    Edmund J. Cross, of Chicago, for appellee Dorothy M. Ruehr; Philip R. Fraser, of Chicago, of counsel.
   Mr. Presiding Justice Hebel

delivered the opinion of the court.

This is an appeal by the plaintiffs from the order of August 20, 1937, entered by the court, discharging the Continental Illinois National Bank and Trust Company of Chicago as garnishee and finding that the funds on deposit with said garnishee in the name of Dorothy M. Buehr, trustee for Henry Buehr, are the funds of Henry Buehr and not the funds of Dorothy Buehr individually. Appeal is also taken from an order entered thereafter on September 21, 1937, by the court denying the motion of plaintiffs to vacate said order of August 20, 1937, which motion had been entered and continued to August 24, 1937.

The garnishment proceeding before the court was based upon an affidavit for the issuance of a garnishment summons. It appears from this affidavit that Don H. McLucas in his verified affidavit states that at the July term of the superior court of Cook county, A. D. 1934, a judgment was entered in favor of Baymond Hurley, as receiver for Fred F. Gardner, et al., creditors of the Kimball Trust &■ Savings Bank, and against Dorothea M. Buehr for a $1,500 debt, and costs of suit; that an execution was issued on said judgment against the defendant and returned by the sheriff of Cook county “No property found”; and it further appears from this affidavit that the defendant has no property in her possession, within the knowledge of affiant. It is further stated in the affidavit that affiant has just reason to believe the Continental Illinois National Bank and Trust Company of Chicago is indebted to the defendant, or has effects or estate of said defendant in its hands.

Summons was issued and an answer filed by the Continental Illinois National Bank and Trust Company of Chicago as garnishee, wherein it is stated, in part:

“Also, it was and now is indebted to one Dorothy M. Buehr in the sum of $610.17 for the balance of a certain savings account carried by her with this garnish.ee in her said name as ‘ Trustee for Henry Ruehr, ’ who appears from the records of this garnishee, to be an infant; but that this garnishee is not advised that its said depositor is Dorothea M. Ruehr, one of the defendants herein, and, therefore, demands strict proof thereof; and that in any event, it appearing that the said Henry Ruehr has some right or interest in or to said account or deposit, he should be notified to appear and maintain the same as an adverse claimant in such manner as this Honorable Court may direct, pursuant to statute, and a guardian ad litem should be appointed for him in this behalf.”

Thereafter the intervening petition of Dorothy M. Ruehr was filed on August 20,1937. From the petition it appears that Dorothy M. Ruehr, as trustee for Henry Ruehr, leave having been obtained, filed her intervening petition in which she states she is one of the defendants in the above entitled proceeding and that a judgment was procured therein on a stockholder ’s liability by reason of stock held by her in the Kim-ball Trust & Savings Bank. It further appears from the affidavit that by reason of a garnishment summons in Case No. 550,558, heretofore issued therein, and which was returnable the first Monday of August, 1937, certain money now on deposit in the Continental Illinois National Bank and Trust Company of Chi-, cago, namely $610.17 in Account No. 69,909 has been embargoed by said bank so that withdrawals may not be made therefrom. Petitioner further avers that on November 2, 1936, she did deposit $525 in said bank for and in behalf of her said minor son, Henry Ruehr; that on- June 4, 1937, she deposited an additional sum of $100 in said bank for and in behalf of her minor son; that at the time the money was deposited she specifically informed said bank that the money belonged to her said minor son and pursuant thereto the said bank did open said account in her name as trustee for said Henry Buehr. Petitioner further states that none of the money belonged to her individually, and that it was a trust fund which commenced before the death of her husband, Beño C. Buehr; that said money was for the support and education of said minor son, who is 17 years of age, and therefore petitioner prays that the court enter a decree that the money is the property of Henry Buehr, a minor, and that petitioner merely holds same as trustee; and further prays that an order issue out of the court directing the release thereof from any proceeding to collect stockholder’s liability judgment now entered herein against the petitioner individually. This petition is verified by the petitioner.

On August 24, 1937, the plaintiff filed a motion to vacate, wherein it appears that heretofore on August 20, 1937, the court entered an order giving Dorothea M. Buehr leave to file her petition to intervene, and dismissing the Continental Illinois National Bank and Trust Company of Chicago, garnishee, as to said Dorothea M. Buehr; that on August 19, 1937, Dorothea M. Buehr caused to served upon the attorneys for the plaintiff herein a notice stating that she would appear by her attorney on August 20, 1937, and ask leave to intervene and that she be permitted to file her intervening petition instanter; that on August 20, 1937, the plaintiffs by their attorneys objected to the filing of said petition and the court having overruled their objection, they requested leave to answer said petition and asked for a hearing on said petition at any date convenient to the court; and that that court denied the requests of plaintiffs’ attorneys and without the benefit of the sworn testimony of any witness entered the aforesaid order dismissing the Continental Illinois National Bank and Trust Company of Chicago, garnishee, as to Dorothea M. Ruehr. This motion of August 24, 1937, was continued until September 21, 1937, and on September 21, 1937, the court denied plaintiffs’ motion to vacate the order of August 20, 1937, in words and figures as follows:

“This cause coming on to be heard upon the petition and motion of Fred F. Gardner, et al., to vacate an order entered herein on August 20, 1937, discharging Continental Illinois National Bank and Trust Company of Chicago, a corporation, as garnishee herein as to the defendant Dorothea M. Ruehr and the court having heard the arguments of counsel and being fully advised in the premises,

“It is Hereby Ordered, That the said petition and motion of Fred F. Gardner, et al., to vacate said order of August 20, 1937, be and the same is hereby overruled and denied. ’ ’

The plaintiffs contend that the action of the trial court in making a finding of fact and discharging the garnishee without hearing evidence was erroneous, and cite in support of this contention the case of Topel v. Personal Loan & Sav. Bank, 290 Ill. App. 558, wherein the court said:

“When section 72 of the Civil Practice Act is invoked the burden is on the one seeking to set aside the judgment- to prove by the preponderance of the evidence the facts alleged in his petition or motion. (People v. Green, 355 Ill. 468; People v. Crooks, 326 Ill. 266.) An inspection of the order of Judge Rush heretofore set forth vacating the order of dismissal shows that no evidence whatever was introduced in support of plaintiff’s petition of September 17, 1936, and it cannot be seriously urged that such petition itself was evidence of the allegations contained therein. In Mitchell v. Eareckson, 250 Ill. App. 508, the court stated at p. 511:

“ ‘Appellant verified her motion but inasmuch as the motion stands as a declaration in a new suit, the verified motion is not evidence of the averments therein contained. The motion is not evidence, although sworn to, as its office is merely to point out the errors of fact on which relief is sought. 34 C. J. 401; Hicks v. Haywood, 4 Heisk. (Tenn.) 598. A sworn petition for a writ of error coram nobis is only a pleading in the case, and is not proof of the matters alleged in it. Johnson v. Straus Saddlery Co., 2 Ala. App. 300, 56 So. 755.’ ”

It does appear from the briefs filed in this case that on August 20, 1937, the intervening petitioner, Dorothy M. Ruehr, was personally present in court. It is also true there was some conversation between the judge and Dorothy M. Ruehr. She, however, was not sworn, nor did the plaintiffs have an opportunity to cross-examine or rebut the unsworn declaration made in court.

The answer of the defendants to this contention of the plaintiffs is that no certificate of evidence being incorporated in the record and the record filed in this court failing to show any part of the proceedings below, except pleadings, it is to be assumed that the trial court heard sufficient evidence upon which to base its action, and every presumption will be in favor of the regularity of the proceedings of the court below.

The court of necessity will consider the evidence and determine whether from the order entered sufficient evidence was heard by the court. The order is as follows :

“On motion of Solicitor for intervening Dorothy M. Ruehr, trustee for Henry Ruehr, a minor, leave is hereby given her to file her petition instanter; the Court further finds that the funds now on deposit with Continental Illinois National Bank and Trust Company of Chicago in account 69909 in the name of Dorothy M. Euehr, trustee for Henry Euehr, are the funds of Henry Euehr and not the funds of Dorothy Euehr individually, and hereby discharges Continental Illinois National Bank and Trust Company of Chicago as to the said Dorothy M. Euehr, only.”

It is evident from the order that the court reached the conclusion that the funds on deposit with the bank in the name of the intervening petitioner were deposited in the name of Dorothy M. Euehr, trustee for Henry Euehr, and are the funds of Henry Euehr and not the funds of Dorothy Euehr individually. In order to reach this conclusion the evidence before the court must justify the order, and we are unable to find that any such evidence was heard.

Plaintiffs call our attention to the ease of Prudence Co., Inc. v. Illinois Women’s Athletic Club, 284 Ill. App. 210, in which this court said:

“Complainants contend that the court erred in overruling, without a hearing, their objections to the receiver’s two reports and accounts above mentioned; that the objections called for strict proof as to the receipts and disbursements, and that the court was wholly unwarranted in overruling the objections and approving the reports and accounts without a hearing on the merits. We think it obvious that this contention must be sustained.
“Complainants’ contention seems to be conceded by counsel for the receiver, but they say that complainants are precluded from questioning the orders since they failed to preserve any record of what transpired at the times when the two orders were issued, and that since the ‘ orders did not show affirmatively that the court heard no evidence, but rather did not expressly state that evidence was heard,’ therefore the orders are sufficient under subsection 3 of section 64, ch. 110, Ill. State Bar Stats. 1935, which.provides: ‘No special findings of fact or certificate of evidence shall be necessary in any case in equity to support the decree. ’ And they also cite the case of First Nat. Bank v. 10 W. Elm St. Bldg. Corp., 277 Ill. App. 337, to the effect that the burden of preserving the evidence is upon the person attacking an order or decree. We hold the contention of the defendants cannot be sustained because the record before us shows that no evidence was heard. The order.of January 26, 1935, recites the motion of the receiver for the approval of his second report and that ‘the court having read and examined the accounts and reports of the receiver, as aforesaid, and the objections thereto, by the Complainant, . . . and having heard arguments of counsel’ finds, etc. And the order of April 24, 1935, is substantially the same. The statute relied upon by counsel for the receiver above quoted, and the rule announced in 277 Ill. App., apply only where the record shows evidence was heard but not preserved. No evidence having been heard, the court was wholly unwarranted in disposing of the objections to the reports without a hearing.”

In the disposition of this case we think the plaintiffs should have had an opportunity to file an answer and be heard in the garnishment proceeding-, and, as previously stated, we believe the court erred in finding that the funds in dispute and in the hands of the garnish ee were the funds of Henry Ruehr, a minor, and not the funds of Dorothy Ruehr individually, and in discharging the Continental Illinois National Bank and Trust Company of Chicago as to.Dorothy M. Ruehr, only, as the order is not sustained by any evidence heard by the court.

For the reasons stated the order is reversed and the cause remanded.

Reversed and remanded.

Denis E. Sullivan and Hall, JJ., concur.


author: Mr. Justice Hall

text:
    Emma Shutan, Appellee, v. Jacob Bloomenthal and E. R. Bennecke, Trading as Bloomenthal and Bennecke, Appellants.
    Gen. No. 39,658.
    Opinion filed June 29, 1938.
    Rehearing denied July 12, 1938.
    Robertson, Crowe & Spence, of Chicago, for appellants ; Eugene P. Kealy and Henry L. McIntyre, both of Chicago, of counsel.
    John A. Bloomingston, of Chicago, for appellee.
   Mr. Justice Hall

delivered the opinion of the court.

This is an appeal from a judgment against defendants for the sum of $2,500, entered in the superior court of Cook county on February 3, 1937, after a jury trial.

Defendants are dentists and are engaged in the practice of their profession in Chicago, and it is charged that on March 24, 1934, they extracted, or attempted to extract, one of plaintiff’s teeth, and as a result of the operation, broke plaintiff’s jaw, causing an infection and improper occlusion of the jaw. Also, that they were negligent in failing to discover that the jaw was broken and in failing to properly treat plaintiff for the ailment which resulted in an infection and permanent injury.

On the day in question, plaintiff visited the office of the defendants in Chicago, and after gas had been administered to the plaintiff, the record indicates that E. B. Bennecke, one of the defendants, extracted an impacted tooth from plaintiff’s jaw.

Plaintiff testified, in substance, that after the operation and after she had returned home, she had a terrific pain and immediately went to bed; that she tried to move her jaw, and that there was a grating or clicking between the bones of the jaw; that thereafter, upon the advice of Dr. Bennecke, she consulted a physician, who gave her a hypo to relieve the pain and induce sleep, and that the next day she called another physician, one Dr. Mary Shutan, a niece of the plaintiff. Plaintiff also testified to the effect that the day after the operation she noticed an inability to open her mouth, and that when she did so, there was a grating, that her jaw seemed to be clinched, and that her jaw started swelling; that the fourth day after the operation, Dr. Bloomenthal, one of the defendants, called upon plaintiff and administered a mouth wash, and that thereafter plaintiff was treated by a local physician, who prescribed sedatives; that the day after this visit to plaintiff by Dr. Bloomenthal, she called at the office of the defendants, and that at that time, the jaw was very painful; that there was a decided grating or clicking if she attempted to open her mouth, and that her jaw continued to be in a swollen condition; that on the second day after plaintiff visited the office of the defendants, after experiencing some difficulty because of the fact that she could scarcely open her mouth, an X-ray was taken of her jaw, and that at that time the doctors mentioned that there was some sloughing of the bone; that thereafter at her home after waking from sleep, plaintiff found a piece of bone in her mouth, which she reported to defendants; that defendants continued to treat plaintiff for four weeks, and that during that time, they took three X-ray pictures, but that her jaw was constantly growing-worse; that after about four weeks, she went to a Dr. Schaefer, whose testimony is hereafter mentioned, and also to a Dr. Nannestad, who also took an X-ray picture of her jaw. She testified that Dr. Nannestad was her family dentist. Her testimony is to the further effect that the Dr. Schaefer mentioned, examined the X-ray made by Dr. Nannestad, and that thereafter Dr. Schaefer operated upon her, after she had taken an anesthetic, and that after Dr. Schaefer’s operation, she “improved very rapidly.” She testified further to the effect that after the tooth had been extracted by Dr. Bennecke, she noticed a gradual paralysis of the chin from the middle of the chin over to the left side, and that that condition has remained with her to such an extent that every time she opens her mouth, there is a feeling- of “drawing down in the corner,” and that if she does not watch carefully, she drools out of the side of her mouth. She also stated that after the operation by Dr. Schaefer, the swelling subsided, but that she had difficulty in opening her mouth for some considerable period, and that at the time of the trial, she ivas unable to chew on the left side, and that it was about three months after the operation before she could completely open her mouth; that her teeth “do not fit down,” and that the center of her top teeth comes nowhere near the center of her bottom teeth, and that before the operation she had no such difficulty. On cross-examination, plaintiff testified that prior to the date of the extraction, she had a consultation with a Dr. Sommerfield, another dentist and that he advised her to have an X-ray taken, and that on the same day she had an X-ray taken at a laboratory near this dentist’s office; that after exhibiting the X-ray to Dr. Sommerfield, she was told by him that she had an impacted molar, and that upon the advice of this dentist, she went to the defendants’ office; that at the time of her consultation with Dr. Sommerfield, her jaw was sensitive; that upon her visit to the defendants, she was told by Dr. Bloomenthal that the tooth would have to be extracted, and that plaintiff stated that that was agreeable to her; that after the operation she was in great pain, and that she told the doctor about it; that in the night she called another doctor named Gethner, who gave her a hypo, and that she also consulted Dr. Mary Slratan, already referred to; that thereafter Dr. Bennecke called on the plaintiff again, and that she Avas informed by him that she would have to go to the defendants’ office; that during this period she could open her mouth very little, and was compelled to subsist on liquid nourishment. She also testified that she returned to her employment the Wednesday after the tooth was extracted, the extraction having taken place on a Saturday; that she only worked for a short time during the first two weeks, but that at the end of two weeks, she went back to her regular work, and that she has been working steadily ever since; that the Dr, Schaefer referred to, opened the jaw bone, scraped the bone and put in a packing, but that she still suffered a great deal of pain.

Dr. F. W. Nannestad referred to by plaintiff, and who took X-rays of plaintiff’s jaw on May 8, 1934, testified that the X-ray taken denoted a fracture of the jaw, and also a triangular piece of loose bone, that the picture showed that the fracture extended all the way through the jaw bone, which, he said, was a “complete fracture,” that the fracture was at one of the thinnest points of the jaw bone, and that the fracture is in the mandible. [Standard Dictionary defines mandible as the lower jaw bone.] He testified that the picture showed that the fracture that had severed the mandible was beginning to close, and that the bone is evidently formed in the triangular place where the piece of bone was removed, and that there is still some evidence of nonunion of the fracture.

While the testimony is not clear on the subject, we gather from this dentist’s testimony that the X-ray picture about which he was testifying, was taken on March 19th or April, 1934. The witness was handed an X-ray picture taken in July or August, 1935, which he examined, and he then stated that “there was still a very, very slight evidence of the fracture, although it is practically . . . healed at this point,” and that “a complete bony union has now taken place where the fracture was.” He also testified that the bone had healed in such a manner that the teeth did not come together correctly, and we gather from his testimony, that in his opinion, this condition would remain.

Dr. E. E. Bennecke, one of the defendants, stated that subsequent to extracting plaintiff’s tooth on March 24, 1934, he and his partners took a series of X-ray pictures of plaintiff’s jaw, but that since then he had a fire in his office and that he has been unable to find the X-rays; that he was shown an X-ray by plaintiff at the time she came to have her tooth extracted, and that at that time, the tooth was covered with tissue, and was blocked up against the tooth next to it, in other words, “it was impacted”; that in order to take the tooth out “we first dissected down to the tooth and then we chiselled around the tooth and then used elevators and ultimately lifted it out with a forceps”; that as far as the witness knew at that time, plaintiff’s jaw was not broken. This witness testified to the effect that after the plaintiff had gone home, her son called up defendants’ office, and that the witness told him that certain treatments should be applied, and that if they did not work, his mother should go to a doctor; that a day or two thereafter, defendant, Bloomenthal, called on plaintiff, and that the witness saw plaintiff four or five days after the tooth was extracted in his office; that he made no X-ray pictures at that time, but that two weeks later he took X-ray pictures, but that he did not then discover that plaintiff had a fracture of the jaw, and that he never did make any such discovery. The witness’s attention was called to an X-ray picture which indicated a fracture of plaintiff’s jaw, and he then testified that none of the pictures taken by him showed any such condition, but that the picture which he was examining showed a comminuted fracture of the jaw. He also testified that during a period of about a month when he was caring for the plaintiff, he never treated her for a.fractured jaw, and that “it was not even necessary to immobilize her jaw because there was no displacement there,” that she had very little swelling in the jaw, not more than would come from an ordinary extraction. He stated that swelling indicates infection, and that after the tooth was extracted,' plaintiff had some difficulty in opening her mouth, and that in taking pictures of her jaw they had some difficulty in getting the film into position; that plaintiff never complained of a sensation of grating of her jaw; that if she had made any such complaint, it would have suggested at once that there might be some crepitas, which would indicate a fractured bone. He also testified to the effect that after extracting an impacted wisdom tooth, the result is that the patient cannot open the mouth for a week or so thereafter, and that a fracture of the jaw is not unusual in the extraction of impacted molars, but that in his experience nothing of the sort had ever occurred to him; that the tooth extracted was the third molar, which is situated at the weakest part of the jaw, and that when the X-ray pictures were taken by him, they found a little crack in the jaw on a line where the tooth was extracted, but there was no appreciable separation of the bone. The defendant Bloomenthal’s testimony is largely to the same effect as that of Dr. Bennecke.

A physician and surgeon named Remington testified on behalf of plaintiff and to the effect that he specialized in bone and joint surgery. He was shown an X-ray picture identified as that taken by Dr. Nannestad, and from this picture this witness gave the opinion that there was “a complete break of the mandible.” Another X-ray picture was shown to this witness, who testified that “we find a well healed fracture, . . . shows the solidification of the bone, everything looks pretty good here, there is a healed fracture. The socket is filling up but not completely healed.” This doctor was asked a number of hypothetical questions by counsel for plaintiff as to. what, or what is not, the usual customary thing* to do with a fractured jaw, all of which he answered, stating* his opinion as to what should be done to a fractured jaw, but he nowhere suggests in his testimony that either of the defendants had been negligent, or that any of the methods adopted by them in treating the plaintiff were to be censured.

Dr. Schaefer, who treated plaintiff after the tooth was extracted, testified on behalf of the defendants and to the effect that he did not find anything to indicate a fracture of the jaw. He testified to the further effect that the extraction of an impacted wisdom tooth under the conditions found, could have produced all of the symptoms and conditions for which he treated her. This witness also testified that because the soft tissues are injured in cases of extraction, infection frequently follows, for the reason that the mouth is full of bacteria, and that plaintiff’s inability to open her jaws, and the pain attendant thereto, was not unusual. Another “dental surgeon” testified as a witness for defendants, but no witness for either the plaintiff or defendants suggested that in their opinion, defendants were guilty of the slightest negligence or malpractice in connection with the treatment of the plaintiff.

In Bollenbach v. Bloomenthal, 341 Ill. 539, a similar set of facts to those in the instant case, was presented. In that case, the defendants, dentists, extracted a tooth, which, from the statement of facts as set forth in the opinion, seems to have been in substantially the same condition as the tooth involved in the instant case. In the course of the operation, the crown of the tooth was fractured, and the defendant testified that he attempted to assemble the scattered portions of the tooth, but that he was unable to determine whether any of the fragments were missing, that at the time of the operation, the plaintiff was under an anesthetic, and that a mouth pack became dislodged, that at the time, he did not suspect, or have reason to suspect, that any portion of the tooth had gone down plaintiff’s throat, and that it was almost a year before he heard anything about it. Some months after the operation, plaintiff in that case coughed up a small piece of tooth and filling-, which were introduced in evidence. After a trial by a jury in the superior court of Cook county, judgment was entered for the plaintiff, which, on appeal to this court, was affirmed. The cause was reviewed by the Supreme Court on a writ of error, and was there reversed and remanded, the court holding that upon the case made, the doctrine of res ipsa loquitur had no application, and that inasmuch as there was no evidence of negligence on the part of the defendants, the judgment could not stand.

In Blodgett v. Nevius, 189 Ill. App. 544 (Abst.), similar to the instant case, this court held that:

“The burden rested upon the plaintiff to show a want of care or skill in the treatment, and that the bad result that followed the treatment was the result of such want of care or skill. No presumption that the defendant was unskillful or negligent follows from the mere fact that the jaw was fractured and that the plaintiff was otherwise injured. As the plaintiff failed to introduce any evidence tending to prove that the fracture or the other injuries alleged was the result of unskillful or negligent treatment by the defendant, a prima facie case was not made out by the plaintiff, and the court should have instructed the jury to find for the defendant.”

In Theisen v. Nogard, 183 Ill. App. 158 (Abst.) this court found in substance and the abstract of the opinion states that:

“In an action to recover damages for malpractice in dental surgery and for negligence in performing dental work, causing plaintiff to suffer from a splintered and broken jaw, evidence held insufficient to sustain a recovery by plaintiff where it does not show malpractice or the employment of any method other than that usually employed by dentists.” See also Scully v. Hawkins, 227 Ill. App. 610 (Abst.), and Olander v. Johnson, 258 Ill. App. 89.

At the close of plaintiff’s case, and at the close of all of the evidence, the defendant moved the court to direct the jury to find the defendant not guilty, both of which motions were denied. Following the rule as laid down in the cited cases that .in the absence of the testimony of experts skilled in the medical and surg-ery profession, to the effect that there was negligence and want of due care on the part of the defendants, there can be no recovery we are constrained to hold that the trial court was in error in failing to direct a verdict for the defendants. The judgment of the superior court of Cook county is, therefore, reversed and judgment is entered here against plaintiff for costs.

Judgment reversed and judgment here against plaintiff for costs.

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