text:
    Brown, Graves & Co. v. James P. Alexander.

      Gaming Contracts—Board of Trade—Options—Action on Notes-Tllegal Consideration—Pleading.

    1. In an action on promissory notes, a plea to the effect that they were given for money due on gaming contracts connected with certain dealings in options, presents a good defense without regard to where the notes were made or were payable.
    2. In the ease presented, as it does not appear that there was to be any delivery of grain under the-contracts in question, and as it is clear that settlements were to be made on the basis of differences in values, this court holds that the transactions between the parties were of an illegal character, and declines to interfere with the judgment for the defendant.
    [Opinion filed March 1, 1889.]
    Appeal from the Circuit Court of St. Clair County; the Hon. George W. Wall, Judge, presiding.
    Messrs. Koerner & Horner and Francis A. Biddle, for appellant.
    The testimony of Mr. Graves sustains the validity of the consideration of these notes and the course of dealing between the parties in every essential particular. He shows that the only “ option” that existed in any of the contracts made by the plaintiffs for the defendant related to a right reserved or held by the seller, under which he might select, at his pleasure, any business day of the month for which the grain was sold, on which to deliver the grain, and make good his contract.
    That such an “ option,” relating merely to the time of delivery, is entirely legal, is undisputed. Logan v. Musick, 81 Ill. 416; Harris v. Turnbridge, 83 N. Y. 99.
    “ Options to buy or sell at a future day” are illegal; hut contracts wherein the only option is the time when, during the month, the delivery shall be made, are valid. White v. Barber, 123 U. S. 392.

      Whatever Alexander’s purposes were, they were unknown to plaintiffs. His secret intentions can not give color to their conduct, or impugn the validity of their contracts. He ordered them to buy grain and they executed the order and reported the fact. Was it their business then to inquire what purpose he had for the grain ? Or whether he intended to sell it again, and, if so, when ? The theory of the defense would seem to so indicate. But the bare statement of such a proposition shows its absurdity.
    The case of Bangs v. Hornick, 30 Fed. Rep. 98, is so nearly in line with the case at bar, and so aptly illustrates the principle under consideration as to justify a liberal extract. The action was upon a promissory note given by the defendant to his brokers for losses incun ed in stock speculation, and the defendant pleaded that it was void because given for a gambling debt. The facts were that the defendant, whenever he wished to buy or sell, gave orders accordingly to his brokers, depositing with them a sum varying from three to ten per cent, as margin. If by the transaction a profit was made his account was credited with it; if a loss resulted he was debited with it; CiIie never received any certificates of stock, never saw any, and did not, of his own knowledge, know whether any were ever bought or sold.”
    The court said:
    ‘‘How, it is doubtless true that where there is in fact no purchase and sale of stocks and none intended by both parties, but simply a wager intended on the rise and fall of prices, the transaction is a gambling one and can not be upheld. But it is equally true and well settled that where the gambling intent exists only on one side, and the other party intends an actual purchase or sale, then the transaction is valid. There is no gambling unless both sides gamble; and from the intent or belief of the one party it is not fair to presume a like intent or belief on the other. Bartlett v. Smith, 13 Fed. Rep. 263; Kirkpatrick v. Adams, 20 Fed. Rep. 287; Irwin v. Williar, 110 U. S. 507. * * * Counsel for defendant say that it is the absolute duty of the court to denounce this transaction, unless it clearly appears that it was a valid and honest one. I think the duty of the court is precisely the reverse, and that it is the duty of the court to uphold it unless it clearly appears that it was an invalid and dishonest one. The defendant has given his note. The law presumes there was á consideration and an honest one, and unless he has shown to the contrary he should abide by the .contract he has made.” Bangs v. Hornick, 30 Fed. Rep. 98.
    “It is very easy for either party to swear what his own understanding of the contract was, but that, standing alone, is manifestly immaterial. The secret intentions of one party uncommunicated to the other party can not prevail to make a contract illegal which is otherwise valid.” Clarke v. Foss, 7 Biss. 548; Ward v. Vosburg, 31 Fed. Rep. 12.
    “The intention of the parties gives character to the transaction, and if either party contracted in good faith, he is entitled to the benefit of his contract, no matter what may have been the secret purpose of the other party.” Pixley v. Boynton, 79 Ill. 351; Rumsey v. Berry, 65 Me. 570.
    Viewed in the light of these well recognized principles, how signally has the -defendant failed to make good his defense. To permit him, when now called upon to indemnify his agents for the moneys advanced for him on the faith of his notes, to then, for the first time, disclose an illegal purpose when he employed them, and thereby defeat their claims, would be to offer a reward for deceit and render the business of agency hazardous to a degree that would absolutely destroy it.
    In a case similar to this, it was held that a recovery could be had, and the fact that notes were given in settlement was held a concession that the wheat was bought for them and the contract was binding upon them. Cole v. Milmine, 88 Ill. 349; Logan v. Musick, 81 Ill. 416.
    A late case in our State where a commission merchant paid out money or incurred liability for his principal in buying and selling grain at the Board of Trade in Chicago, and was allowed to recover against said principal, is Powell v. McCord, 121 Ill. 331. In fact we may safely say that no authority can be found' in Illinois condemning contracts of the kind involved in this case, and there is an abundance of decisions upholding their validity, both at common law and under the stringent statute of our State.
    A contract for the sale of goods to be delivered at a future day is not invalidated by the circumstance that at the time of the contract the vendor neither has the goods nor has entered into a contract to buy them, nor has any reasonable expectation of becoming possessed of them otherwise than by purchasing them after making the contract. Hibblewhite v. McMorine, 5 M. & W. 462; Cook v. Davis, 53 N. Y. 318; Smith v. Bouvier, 70 Pa. St. 325; Appleman v. Fisher, 34 Md. 540; Benjamin on Sales, 82, 83, 541, 542; Mortimer v. McCollan, 6 M. & W. 462; Tomblin v. Callen, 22 Iowa, 367.
    Messrs. Marshall W„ Weir and Turhbb & Holder, for appellee.
    The notes sued on, being given for money due upon gambling contracts—pretended purchases and sales of grain with the intention that no grain was to be delivered, but that the deals were to be filled by adjusting the difference in prices— no recovery can be had. 2 Benjamin on Sales, 715; Irwin v. Williar, 110 U. S. 499; Pickering v. Cease, 79 Ill. 328; Lyon v. Culbertson, 83 Ill. 33; Pearce v. Foote, 113 Ill. 229; Coffman v. Young, 20 Ill. App. 77.
    Appellants can not recover for commissions and disbursements, whether they acted as principals or as brokers, they knowing the nature of the transactions and helping to forward the same. Irwin v. Williar, 110 U. S. 499; Pearce v. Foote, 113 Ill. 229; Coffman v. Young, 20 Ill. App. 77; and cases cited.
   Phillips, J.

Appellants sued out their writ of attachment against appellee, and the same was levied on lands in St. Clair county. Appellants filed their declaration, founded on two promissory notes, each of date of August 26, 1886, each due three months after date, one for the sum of $3,741.17, the other for $5,000. Both notes were made at Culpepper county, Virginia, and were made payable at Franklin Bank, Baltimore, Maryland. Appellee appeared and filed various pleas, to some of which demurrer was sustained and issue was joined and trial had on the following pleas:

1. General issues.

2. “And for second amended plea in this behalf, defendant says, actio non, because he says that the several causes of action mentioned in the plaintiff’s said declaration are for the same causes of action mentioned in the first two counts thereof, and not different or other causes, and that the consideration of the notes sued on herein and mentioned in said first two counts was a sum of money due and owing upon a gambling contract under which he purchased options to sell and buy grain to be nominally delivered at a future time, but with the understanding between plaintiff and defendant that no grain would be delivered under said contracts, and that said contracts were to be filled on the maturity thereof by adjusting the difference in the market values. And this the defendant is ready to verify, wherefore he prays judgment,” etc.

3. “And for further plea in this behalf defendant says actio non, because he says that the several causes of action mentioned in plaintiff’s declaration are one and the same, namely, the promissory notes mentioned in the first two counts thereof, and that the consideration of said notes was a sum of money due and owing upon a gambling contract under which he purchased options to sell and buy grain at a future time, in violation of the statute in such case made and provided; and said defendant avers that said contract is in violation of the laws of Virginia, where it is alleged to have been made, and in violation of the laws of Maryland, where said contract was specifically made payable. And this defendant is ready to verify, wherefore he prays judgment,” etc.

On trial before the judge, without a jury, a verdict was rendered for defendant. The plaintiff brings this appeal. The notes were offered in evidence for plaintiff. The defendant offered no evidence as to the laws of the State of Maryland, where the notes were- payable, nor of the laws of the State of Virginia, where made. The assignment of errors must be considered with reference to the second plea, and the evidence offered 'thereunder. “ Agreements for the future delivery of grain, or any other commodity, are not prohibited by the common law, nor by any statute of this State, nor by any policy adopted for the protection of the public. What the law does prohibit, and what is deemed detrimental to the general welfare, is speculating in differences in market values. The alleged contracts for August and September come within this definition. No grain was ever bought and paid for, nor do we think it was ever expected any would be cabed for, or that any would have been delivered had demand been made. What were these but optional contracts in the most objectionable sense? That is, the seller had the privilege of delivering or not delivering, and the buyer the privilege of calling or not calling for the grain, just as they chose. On the maturity of the contracts they were to be filled by adjusting the differences in the market values. Being in the nature of gambling transactions, the law will tolerate no such contracts.” Pickering v. Cease, 79 Ill. 328. The case of Wolcott v. Heath, 78 Ill. 433, was one before our present statute was in force, and the court held: “What the law prohibits and what is deemed detrimental to the public interests is speculations in differences in market values, called, perhaps, in the peculiar language of the dealers 6 puts and calls,’ which simply means a privilege to deliver or receive the grain or not at the seller or buyer’s option. It is against such fictitious gambling transactions, we apprehend, the penalties of the law are leveled.”

We hold the defense set up by the second plea is one that at common law is to be held as a gambling transaction and being such, the plea presented a defense regardless of where the notes were made or were payable.

Does the evidence in this case, then, show that the notes sued on were for the consideration of “ a sum of money due and owing upon a gambling contract under which he (the defendant) purchased options to sell and buy grain, to be nominally delivered at a future time, but with the understanding between plaintiff and defendant that no grain would be called for or delivered under said contracts, and that said contracts were to be filled on the maturity thereof by adj listing the differences in the market values?” The appellee testified that the notes offered in evidence were given in consideration of other notes made by him and which were taken up, which notes so taken up, he states, were given for margins.

The appellee states that the margins were put up on option trading, and that he both bought and sold. That he gave orders to buy wheat in New Fork, Chicago, or anywhere. No wheat was ever delivered. He further' states it was not the intention of the parties to ever deliver wheat; that no wheat was ever tendered to him on the one hand or offered by him on the other. The appellee offered in evidence numerous telegrams sent by appellants to appellee, about forty-two in number, from which we select certain ones as indicative of the others:

“ Market very quiet. Scarcely anything doing. Sept, wheat 96f on a break would cover part Chicago short wheat and sell on advance. Where shall we write you to ? ”
“Bought twenty-five Sept. Chicago eighty-eight half. Will sell again on any advance.”
“ Sold twenty-five Oct. wheat Chicago closes weak, on report hot wheat.”
“Market looks rather heavy. If advances to nine will sell again. Will make up the wheat bought to-d.ay against the highest sale.”
“ Sold forty-five M. Oct wheat Chicago at ninety one-eight.”
“ Bought forty-five M. Sept, wheat eighty-eight Chicago. Looks for higher prices.”
“ Looks like a good sale in St. Louis. Might be well to hold for a profit.”
These last three telegrams are of the same date.
“ Bought sixty Oct. eighty-three three-eights. Think would put out again on bulge and keep short double-long here.”

Eleven letters of a similar character to the telegrams, with numerous accounts of sales, were offered in evidence. The evidence shows many transactions of buying and selling grain at widely different points—Hew York, Baltimore, Chicago and St. Louis—with dates and time of delivery nearly the same. The plaintiff Graves, who testifies, insists that in each case the plaintiffs were acting as the agents of defendant as a commission house, and made the purchases of grain for delivery and for grain to be sold and delivered, and that the commission house, the plaintiffs, were compelled to settle by receiving purchases on seller’s option, and to deliver it to the party to whom sold, unless in the meantime it should have been settled by some other contract, and that the commission house never had any agreement with the defendant that no grain would be called for or delivered under the contracts, or that the contracts were to be filled by the settlement of the differences in the market. It does not appear from this evidence that the wheat bought or sold was in existence. It was not evidenced by warehouse receipts, nor are the rules of the Board of Trade at any point where purchases and sales were made offered in evidence. The form of buyer’s contract, as shown by the plaintiff Graves in his testimony is:

Buyer's Contract, Baltimore Corn and Flour Exchange. Ho.- Baltimore,-, 188—.
“For value received,-, have this day bought and agreed to receive from-bushels of-, Baltimore inspection, at-cents per bushel, delivered in elevators, at the seller’s option, during the month of-188—. Certificates tendered on this contract must have not less than three days free storage. In case of dispute it is mutually agreed that the matter shall be referred to the arbitration of three members of the exchange—two of the arbitrators to be respectively chosen by the parties in dispute, they to select a third—and a decision.of a majority of the arbitrators shall be final and binding. This contract is to be governed by the rules, regu'ations and by-laws of the exchange, in force at this date. If a margin or security has been put up by-the decision of the arbitrators shall be made known to the committee on margins, and the committee shall sign an order for the release of the margin or security.”

And in the same testimony the form of seller’s contract is given as follows:

Seller’.s Contract, Baltimore .Corn and Flour Exchange. “Mo.- Baltimore,-, 188—■.
“For value received,-, have this day sold and agreed to deliver to-bushels of--, Baltimore inspection, at-cents per bushel, deliverable in the elevators at the seller’s option, during the month of -, 188—. Certificates tendered on this contract must have not less than three days free storage.
“In case of dispute it is mutually agreed othat the matter shall be referred to the arbitration of three members of the exchange, two of the arbitrators to be respectively chosen by the parties in dispute, they to elect a third, anda decision of a majority of the arbitrators shall be final and binding. This contract is to be governed by the rules, regulations and bylaws of the exchange in force at this date.
“If a margin or security has been put up by-, the decision of the arbitrators shall be made known to the committee on margins, and that committee shall sign an order for the release of the margin or security.”

These are the only forms of contract given with reference to the transactions between appellants and appellee, and unlike the case of Lyon & Co. v. Culbertson, Blair & Co., 83 Ill. 33, where the rules of the Board of Trade were in evidence. In this record the rules of the Board of Trade not 'being in evidence, we can only construe the transactions of the parties by the contracts as shown by the evidence in the record. And the language of the Supreme Court in Lyon & Co. v. Culbertson, Blair & Co., supra, is, we think, applicable. “Had the agreement required the party, before he exercised the option, to have made an offer, or at least have shown that he had the ability to fulfill his part of the agreement, and was willing to do so, then the contract would have conformed to legal principles; but, under the terms of this contract, appellees were not required to liavt a bushel of grain they could have delivered at the place of performance. It is true the contract speaks of wheat ‘in store,’ but neither wheat nor warehouse receipts were offered. * * * The fact that no wheat was offered or demanded, shows, we think, that neither party-expected the delivery of any wheat, but in case of default in keeping margins good, or even at the time for delivery, they only expected to settle the contract on the basis of differences, without either performing or offering to perform his part of the agreement; and if this was the agreement, it was only gaming on the price of wheat.”

The evidence in this record does not show the tender of any wheat or any contract by any party thereto, nor does it show any party calling for wheat and ready and willing to receive the same. All the transactions seem to have been settled on the basis of differences in values. The trial court so held, and having the witnesses before the court, and finding from the evidence that the defense alleged under the second plea was a bar to the right of recovery on the part of appellants, we find no error in the record that would warrant us in disturbing the verdict. The j udgment is affirmed.

J udgment affirmed.


source: Caselaw Access Project

author: Phillips, J.

license: Public Domain

text:
    Frederick Koch, Sr., v. Mary E. Quick.

      Drainage — Equitable Assignment of Bonds Issued in Payment for Labor—Estoppel—Verdict—Interest.

    1. An order upon drainage commissioners to issue bonds payable to a third person or order, in such sum as may be due the maker thereof for labor performed, they promising to comply therewith upon ascertaining the sum due, is an equitable assignment.
    2. After such order has been accepted and the maker has left the State, a commissioner having a claim against him is estopped from asserting it against the one in whose favor the order was made.
    3. In the case presented, the bonds having been delivered to one of the commissioners, this court sustains a judgment against him in an action for money had and received in favor of the holder of the order.

      [Opinion filed March 1, 1889.]
    Appeal from the Circuit Court of Monroe County; the Hon. George W. Wall, Judge, presiding.
    Mr. Joseph W. Riokert, for appellant.
    These bonds belong to the district if they are not legally the property of appellant, and for their recovery the commissioners, as such, alone are vested with the exclusive legal authority to institute the proper action against appellant. And if the legal right,to sue the appellant for the recovery of these bonds, or their money value, be in the Drainage Commissioners, then certainly appellee can not maintain her action against him, who received no money or drainage bonds for her use,- and the Circuit Court should have so decided. Trumbull v. Campbell, 3 Gilm. 502; Hall v. Carpen, 27 Ill. 386; Carpen v. Hall, 29 Ill. 512; The G. & M. R. R. Co. v. Burns, 92 Ill. 302; McIntyre v. Thompson, 14 Ill. App. 554; Neil v. Chessen, 15 Ill. App. 266.
    By refusing the motion of appellant to dismiss this action the Circuit Court erred, because the testimony shows that he did not receive any money to which the appellee makes claim, but had received drainage bonds, nominally worth $300, properly registered in the drainage record and representing, after a lapse of time, a promise to pay money out of the drainage treasury.' A plaintiff under the common money counts can recover from a third party only for money or property concerted into money by the defendant which equitably and in good conscience belongs to the plaintiff.
    Here the defendant, as claimed, converted the drainage bonds of plaintiff but still holds them as bonds, and at any time willing and capable of delivering them in specie to plaintiff upon proving them to be her property.
    Appellee has misconceived her form of action and it became the duty of the trial court, after hearing the testimony in the cause, upon the suggestion of appellant, to dismiss the suit, unless appellee, with leave of court, thought proper under the statute to change her form of action.

      She refused by leave of court to change the form of her action; the court thereupon denying the appellant’s motion to dismiss, unquestionably erred in rendering, contrary to the well established and clearly defined boundaries between common law actions, a money judgment against the defendant for $327. Chitty’s Pleadings, 14th Am. from 6th London Ed., 340 and 351; Citizens’ Gaslight and Heating Co. v. Granger, 19 Ill. App. 201; Kelty v. Owens, 4 Chand. 166; Carlisle v. Dunn, 5 Blackf. 605; Tolan v. Hodgeboom, 38 Mich. 624; Blair v. Wilson, 28 Gratt. 185; Kidney v. Persons, 41 Vt. 386.
    Mr. William Wirkelmahn, for appellee.
    Appellant had notice of this assignment, and when he, on the 25th of July, 1885, took the order from Pruitt for the funds, which he knew had already been assigned to appellee, appellant was guilty of a fraud, and therefore not entitled to relief.in a court of justice.
    Appellant is not permitted in law to gainsay what he has, over his signature, deliberately asserted to be true, to wit: That on the 6th of .March, 1886, there was due to Pruitt $316.80, and that this amount had been placed to the credit of appellant.
    At the time appellee presented her order to Warnock and Koch, there was not the slightest intimation by either, of them that the earnings of Pruitt had already been transferred to Koch or otherwise. On the contrary, they not only promised, but by their acts and conduct led appellee to believe, that whatever amount was coming to Pruitt on a final estimate should be applied on her order, and for that purpose the order was taken by them and retained for more than fifteen months; and now, in the face of these facts and the record referred to, when called upon, Koch deliberately comes forward and says that the entry on the drainage record, signed by him and the other commissioners, is not true; that he (Koch) never promised and led appellee to believe that she should have the proceeds of Pruitt’s earnings. If ever an estoppel is applicable, this is the case. Smith v. Newton, 38 Ill. 230; 1 Greenl. Ev., Sec. 207; Trimble v. State, 4 Blackf. 437; Kinnear v. Mackey, 85 Ill. 97.

      Counsel for appellant contends that inasmuch as appellee’s order was payable in drainage bonds, and there is no evidence in the record that appellant has converted the bonds into money or money’s worth, appellee can not recover on the common counts. We deem it a sufficient answer to say that this suit is not brought to recover the bonds or their value, but is brought to recover §316.80, with the interest thereon from March 6, 1886, which has been placed to the credit of appellant. That an action for money had and received may be sustained by proof of a credit in account in the books of a third person, we cite Hatton v. Robinson, 4 Blackf. 480.
   Phillips, J.

Action of assumpsit for money had and received and amount stated. John Pruitt, by contract with the drainage commissioners of Columbia Drainage and Levee District No. 3, of Monroe county, Illinois, had performed cer-tain work for such commissioners, to be paid for in the bonds of the district, and being indebted to appellee, made and delivered to her an order, as follows:

“ Messrs. L. Warnock, F. Koch and J. Fischer, Commissioners of Columbia Drainage and Levee District No. 3, of Monroe county, Illinois: Please issue and deliver to Mrs. M. E. Quick, payable to her order, bonds to the amount of $552, and this shall be your receipt for the same.
“This 6th day of June, A. D. 1885.
“John Peuitt.”

On June 7, 1885, that order was presented to Warnock and Koch, at Columbia, Illinois, by Mrs. M. E. Quick, and they said to her whatever was coming to Pruitt on final measurement she should have. The order was left with them, by them delivered to their clerk, who kept the same with the papers, and was retained until after the commencement of this suit. A short time after the presentation of this orfier Pruitt quit work and left the State, and at that time the record-of the commissioners show his work not paid for amounted on final measurement to $316.80. Appellant had incurred liability as security for Pruitt, and claims that on final measurement, when the amount of Pruitt’s work was determined, bonds were issued and delivered to Pruitt, and by him turned over to appellant. The record, however, as- made by the commissioners, of whom appellant was one, was offered in evidence, and is as follows:

“John Pruitt was allowed on old contract a balance of...§ 1.08 John Pruitt was allowed estimates of 1,750 cubic
yards, at 18 cts............................. 315.00
Total amount allowed Pruitt...................... §310.80 which was placed to the credit of Frederick Koch, Sr.
L." Wakhock,
F. Koch, Sr.,
J. Fischer,
Commissioners.”

On trial in the Circuit Court of Monroe county a verdict was found for appellee for §327, and appellant prosecutes this appeal. On the order made by Pruitt to appellee being executed and delivered, and the same presented to Warnock and Koch and by them delivered to their clerk, they promised that whatever was coming to Pruitt on final measurement should be appellee’s. That order and promise made an equitable assignment of the amount that might be found owing to Pruitt from the district. , Phelps v. Northup, 56 Ill. 156.

Warnock and Koch, as such commissioners, had knowledge of that assignment, and the order having been delivered to them and thus retained until after Pruitt left the State and until after the commencement of this suit, with no notice to appellee of any claim made on the part of another to the same money, or bonds, and appellee thus caused to remain quiet and not attempt to collect her claim from Pruitt, Koch should be held estopped from asserting a claim to either the money or bonds thus, on final measurement, found owing for that work. Kinnear v. Mackey, 85 Ill. 96.

Whether, therefore, the money was placed to the credit of Koch, as appears by the record he aided to make for the commissioners, or the bonds were issued and delivered to Pruitt and by him turned over to Koch, in either case it would be inequitable for him to thus retain the same. It is insisted, however, that appellee has misconceived her action and trover only would lie, and that an action for money had and received can not be maintained on the state of facts here shown. By the order drawn in appellee’s favor the commissioners were directed to issue and deliver bonds payable to her order. Whether the bonds were issued in favor of appellant payable to his order, as would be the inference to be drawn from the record of the board, or whether, as appellant testifies, the bonds were issued to Pruitt and by him turned over to appellant, in either case the legal title to the bonds would be so in appellant that he alone could sue on the same, and we hold the action for money had and received will lie, and that there was such privity that appellee is entitled to recover.

It is further claimed that the verdict and judgment, being for.the sum of $327, is excessive and not sustained by the evidence. We have seen that $316.80 owing Pruitt was placed to the credit of appellant, as appears from the records, and, as appears from the testimony of appellant, bonds to the amount of $300 were issued to Pruitt and by him turned over to appellant. That, as appears from the evidence, was on July 25,1885. The judgment was rendered October 25,1887. From the facts appearing in the case, interest was recoverable^ and the verdict is not too much.

We find no error in the record and the judgment is affirmed.

Judgment affirmed.


author: Green, P. J.

text:
    The Ohio & Mississippi Railway Company v. Joseph Maisch.

      Railroads—Personal Injury—Highway Crossing—Contributory Negligence.

      In an action against a railroad company to recover damages for injuries caused by a collision at a highway crossing, this court reverses a judgment for the plaintiff as contrary to the evidence, the collision having been caused by his own gross negligence.
    [Opinion filed March 1, 1889.]
    Appeal from the City Court of East St. Louis; the Hon. B. H. Canby, Judge, presiding.
    Messrs. Pollard & Werner, for appellant
    Mr. L. H. Hite, for appellee.
   Green, P. J.

This suit was brought to recover for personal injuries and the value of a buggy. The declaration contained two counts, the first charging negligence in failing to give either of the signals required by the statute, the second charging negligence in running the train at a high and dangerous rate of speed.

At the trial after all the evidence was in, plaintiff abandoned the first count and dismissed his suit as to said count. At the time and place of the accident there were two tracks running east and west, one a main, the other a side track; on the latter a freight train was standing headed west, its engine 1,000 feet from the crossing; the train which struck plaintiff’s buggy was running east on the main track. Plaintiff and his companion were riding in an open bnggy on the highway coming from the north, the main track being the one nearest them as they approached; in crossing this track, the hind wheels of the buggy were struck by the engine, and plaintiff thrown out and injured, and his bnggy so broken as to be of little value. The accident occurred in Gaseyville, about nine o’clock on the night of September 26, 1887. Plaintiff and the person with him had resided in Gaseyville a number of years and were familiar with the crossing, and knew about the time defendant’s trains passed through the town. The plaintiff not only failed to show he or the person driving were exercising reasonable care as averred, but on the contrary the record discloses the fact that the reckless and inexcusable negligence of plaintiff and his companion brought about the collision.

They admit they saw the headlight of the engine which struck them, when they were twenty-five feet distant from the main track, and say they did not know whether the train was moving or not, but believing it to be stationary, did not stop to ascertain with certainty, and continued on their way across, or, as the one driving testifies, “ When I got within twenty-five feet of track, I looked up and down the track, gazed on the engine standing there and drove right down;” and neither of these persons looked again after they reached this point, until they were on the main track and the train almost upon them. Had they used the most ordinary precaution, and stopped and looked, they must have discovered the train to have been in motion and no accident would "have occurred. They left a place of absolute safety to encounter a probable danger. In explanation of the cause for his mistake in supposing the headlight facing east to be on a stationary train, the driver testifies he was confused by the blending of the two headlights, one on the freight engine headed west and the other on the train that struck the buggy, and this when he was at the point twenty-five feet from track. The headlight on freight engine was then 1,000 feet west of witness; the headlight of the approaching train could not have been blended with it after it had passed that point, and would then have been the only one visible if witness had looked, as the east bound train would have shut out from his view the headlight of the freight engine. By looking he would have removed all uncertainty and ascertained the headlight facing east was on a train in motion running toward the crossing he was approaching.

Upon a full and fair consideration of all the evidence we are of opinion the accident and resulting injury complained of was occasioned by the gross negligence of plaintiff and his companion who was driving, and that plaintiff had no right of action against defendant. Entertaining this view we see no reason for remanding the cause. The judgment is reversed.

Judgment reversed.


text:
    A. W. Lawwill et al. v. Margaret R. Lawwill et al.

      Life Insurance—•Mutual Benefit Society—Uncertainty as to Beneficiaries —Legal Heirs—Interpleader.

    1. The word heirs, when uncontrolled by the context, must be construed to mean the persons designated by the statute as such in case of intestacy.
    2. Upon a bill of interpleader filed by a mutual benefit society to ascertain to whom payment should be made upon the death of a member, the beneficiaries named in the certificate being “ his legal heirs,” this court holds that the widow is entitled to the amount due under the certificate, there being no children or descendants of any child of the deceased.
    [Opinion filed March 1, 1889.]
    In error to the Circuit Court of Marion County; the Hon. Amos Watts, Judge, presiding.
    Mr. Henry 0. Goorarow. for plaintiffs in error.
    The certificate of insurance was made payable to the legal heirs of William H. Lawwill, upon his death. The simple question is, who are the legal heirs of William H. Lawwill. That being ascertained, it is clear to whom the money is payable.
    An heir is one upon whom the law casts the estate immediately upon the death of the owner. Richards v. Miller, 62 Ill. 417.
    Those to whom the law would give his property, real and personal, are the legal heirs of such person. The words legal heirs of a person in a policy of insurance will be held to mean those to whom "the law would give his property, real and personal, if he should die intestate. Gauch v. The St. Louis Mutual Life Insurance Company, 88 Ill. 251.
    In this case William H. Lawwill died intestate, leaving no child or descendants of a child, but left him surviving his widow, Margaret R. Lawwill, and the plaintiffs in error, his brother, sisters and descendants of a deceased brother, and no parents. In such an event the statute of descents fixes his heirs to be his widow, brothers and sisters and their descendants. Clause 2d and 3d, Chap. 39, R. S. 1883, p. 438,
    The legal heirs of William H. Lawwill at his death, then, were the plaintiffs in error, and the defendant in error, Margaret R. Lawwill, these persons being the legal heirs of William H. Lawwill, and are the persons to whom tbe money arising from said certificate of insurance was payable.
    The persons who are the heirs of William H. Lawwill being settled, the next question is how do they take the money—by descent or as purchasers? If by descent, then the Circuit Court decided right; but if they take as purchasers, then all the heirs would take pro rata, and the judgment of the Circuit Court should be reversed.
    In this case the heirs of William H. Lawwill will take the insurance money as purchasers and not by descent, for this reason: the insurance certificate was no part of the estate of William H. Lawwill, and does not go to the administratrix; and for this reason they take under a contract made for their benefit, and not under a devise or a will.
    In our law this insurance certificate was not a devise, as the law provides for the kind of instruments which shall be a will or devise, but was a contract made by the Masonic Benevolent Association with William H. Lawwill for the benefit of his heirs.
    Where persons take what the law would give them they are adjudged to take by descent. Rawson v. Rawson, 52 Ill. 62; Richards v. Miller, 62 Ill. 417; Kelley v. Vigas, 112 Ill. 242.
    In this case the insurance money was no part of tbe estate of William H. Lawwill, but was the property of his beneficiaries, his legal heirs.
    The word heirs is plural and means more than one, and William H. Lawwill, in having the certificate of insurance made payable to his heirs, intended all of them, and by no construction can any other intention be given the word heirs. Had he intended his wife to be his only heir he would have so said; and the fact he said heirs, shows conclusively he intended all his heirs and not her alone. There is no room for construction to be placed upon such language to find the intention; the intention is expressed in the language, and in the plural number, and must so stand.
    There are authorities to the extent that a widow is not an heir to the estate of her deceased husband; even under the statutes of Illinois, except where she may take by virtue of the statute, she can not take as heir or by descent, under or by virtue of a will, deed or contract. Brown v. Harmon, 73 Ind. 412; Jacobs v. Jacobs, 42 Ia. 600; Richardson v. Martin, 55 N. H. 45; Lord v. Bourn, 63 Me. 368; Tilman v. Davis, 95 N. Y. 17; 1 Bouv. Law Dictionary, 664; Elsey v. Odd Fellows’ Association, 142 Mass. 224.
    We take it, then, that the money collected by the defendant in error, the Masonic Benevolent Association, upon said certificate or policy of insurance, was payable to the legal heirs of William H. Lawwill, deceased, and that the legal heirs are plaintiffs in error, and the defendant, Margaret R. Lawwill, and that the court erred in finding her the sole heir and decreeing her all the money, but should have adjudged the money to have been divided equally among the aforesaid heirs,
    Mr. M. Schaeffer for Margaret R. Lawwill, defendant in error.
    We have here a contract made by Wm. H. Lawwill in his lifetime with this association for the payment of money upon the termination of his life, made in the State of Illinois, with the presumed knowledge of our statute of descent, which provides in its third clause, Sec. 1, that “ when there is a widow, and no child or children of the intestate, then (after the payment of all just debts) * * * the whole of the personal estate shall descend to such widow * * * as an absolute estate forever.” Chap. 39 R. S., Sec. 1, item 3.
    At the time the policy was issued Wm. H. Lawwill had no heirs. He had a wife who might or might not survive him. He might, for all he knew, at the time of his death, have a child or children. In view of these contingencies he had the money made payable to his legal heirs, permitting the law and the facts existing at the time of his death to determine who they were. With the consent of the association he might, at any time before his death, have had the payees changed. There were no vested rights in the heirs of which he could not have divested them. Herann v. Howard, 23 Wis. 108; Otis v. Beckwith, 49 Ill. 121; People v. Johnson, 14 Ill. 342; Universal Life Ins. Co. v. Cogbill, 30 Gratt. 72.
    There can be no doubt that under our statute of descent, Sec. 1, the widow is made an heir of her deceased husband, and the third item in that section determines the amount to which she is entitled in a case like this. It shows that she is preferred to all other collateral kindred, so far as all personal property is concerned. It seems quite evident that, viewing the policy of insurance under the rules above referred to, it was the intention of Mr. Lawwill that the money due at his death should go as other intestate personal property; that in case he had no child surviving him, Ins widow, if she survived him, should have the benefit of his insurance.
    The rule laid down in the cases of Rawson et al. v. Rawson et al., 52 Ill. 62, and reiterated in the case of Kelley v. Vigas, 112 Ill. 242, as to the meaning of the term legal heirs, in wills, applies in this case. The widow is the sole legal heir. These two cases are approved by the Supreme Court in the case of Gauch v. St. Louis M. L. Ins. Co., 88 Ill. 251.
   Phillips, J.

William H. Lawwill obtained a policy of insurance on his life from the Masonic Benevolent Association of Central Illinois, payable “ to his legal heirs, or legal heirs of said William H. Lawwill.” He died, leaving no children or descendants of a child, but left surviving his widow, Margaz-et B. Lawwill, and brothers and sisters and the descendants of his deceased brother, who are the plaintiffs in error. The widow claimed the amount of the policy from the company, as did also the brothers and sisters. The insurance company filed its bill of interpleader to ascertain to whom payment should be made. The trial court decreed that the widow was entitled to the amount insured, and the brothers and sisters and the descendants of a deceased brother, excepting to the decree, sue out this writ of error. In the case of Kelley v. Vigas, 112 Ill. 242, the court held: “ The word heir, when iincontrolled by the context, designates the person appointed by law to succeed to the estate in question, as in case of intestacy, and so the authorities seem to hold. Who are heirs of the deceased person is determined and declared by statute, and the quantity each shall take, as heir, is also fixed.” In Richards v. Miller, 62 Ill. 417, the residuary clause of a will was, “ I give, devise and bequeath to my heirs at law the remainder of my estate.” The testator died, leaving surviving a husband, brothers and sisters, and the court uses this language: “Is the husband an heir ? The statute unquestionably makes him such, when it says that upon certain contingencies, one-half of the real estate of the wife shall descend to him, as his exclusive estate forever. An heir is one who inherits. lie takes an estate in land from another by descent, as distinguished from a devisee, who takes by will. He is one upon whom the law casts the estate immediately upon the death.” In Rawson et al v. Rawson et al., executors, 52 Ill. 62, a case where the husband died leaving no children surviving, or descendants of children, but leaving a widow and brothers and sisters, the residuary clause directed that his residuary estate “may be distributed to my heirs at law according to the statute of Illinois.” The court held : “ Our conclusion is that, as there is nothing in the will calling for a particular or special construction to be placed upon the term, 1 heirs at law/ as used in the will, it must he interpreted according to its strict, technical import, that heirs at law are such as are made so by the statute, and are the person or persons on whom the law easts the estate in case of intestacy; that the widow of the testator is within the contingencies specified in the statute and is the heir at law to his estate; that the estate in question is an intestate estate, and that the 46th section of the act making the widow heir to the whole personalty has not been repealed.” In this case Margaret !!• Lawwill was the administratrix, and was a party to the bill as such administratrix, and also as the widow.

The contract of the insured was that the sum for which he was insured was to be paid to his legal heirs, and it being so provided, the persons to take and the proportions taken must be determined by the statute as in case of an intestate estate.

There being no children or descendants of a child, the widow, under the statute, would take the whole of,the personal estate in case of an intestate estate. And we hold that by the contract in this policy the amount insured was to be paid to his legal heirs, and Margaret Tl. Lawwill, the widow, was the legal heir, to whom the amount insured was payable under the policy. The decree is affirmed.

Decree affirmed.


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    Paul Nenninger et al. v. Sebastian Fietsam, Adm’r.

      Arbitration—Administration—Sale of Lands to Pay Debts—Insufficient Petition—Statutes—Practice—Decree.

    1. A petition for a decree to sell lands for the payment of debts, which fails to disclose the date of the death of the intestate and of the granting of letters of administration, and whether the claim was allowed within two years from the granting of such letters, is insufficient.
    2. The petition in question is also insufficient to authorize a decree of sale of subsequently acquired assets to satisfy a claim allowed after two years.
    3. The distribution of the p-'rsonal assets within two years will not, in the case of a claim allowed or judgment recovered within such time, authorize a sale of real estate for the payment thereof, except in case of a deficiency of personal assets.
    4. In such cases objections to an answer must be taken by exception.
    5. The findings in a judgment against an administrator are not in such cases conclusive against the heir, and can not be held to aid either the want of averments in the petition or the finding of necessary facts in the decree of sale.
    6. In the case presented, the decree finds none of the facts required by Sec. 107, Chap. 3, Starr & C. Ill. Stat., nor is it sufficient under the amendatory act of 1887.

      [Opinion filed March 1, 1889.]
    In error to the Circuit Court of St. Clair County; the Hon, William H. Sjstyder, Judge, presiding.
    Mr. William Winkelmake, for plaintiff in error.
    In Harding v. Le Moyne, 114 Ill. 65, the court says: “It is essential to the right of an administrator to apply for an order to sell real estate to pay debts, and to the jurisdiction of the court to grant such order, that it shall be made to appear by the petition that the personal estate is insufficient to pay the just debts against his estate, and that the administrator has made a just and true account of the personal estate and debts of the deceased to the proper County Court. Unless these jurisdictional facts appear on the face of the petition, the court has no power to make an order in the premises.” Applying the principle announced to the petition in this case, we find the same wanting in the most material averments. Lynch v. Hickey, 13 Ill. App. 139.
    ■ We contend that the lands of a decedent are as at common law; can not be sold by an administrator, except upon one condition, to wit, deficit of personal assets. (Section 98.) And this deficit, upon the hearing of the case, must be found by the court, as well as the other necessary facts to be set forth in the petition. (See section 107.) Without such finding, the court has no jurisdiction. Walker v. Diehl, 79 Ill. 473.
    We contend that the Circuit Court erred in overruling jSTenninger’s demurrer to the amended petition, for the reason that the petition fails to set forth the facts and circumstances on which the petition is founded and the amount of claims allowed, with an estimate of the amount of just claims to be presented; the amount of personal estate which has come to the hands of the original administrator, Rhein; and the manner in which the administrator has disposed of the same, with a statement of the amount of claims paid; nor is it shown by the petition that the administrator has made a just and true account of the personal estate and debts to the County Court.

      The statute, chapter 3, section 100, requires that the petition shall set forth the above facts; at all events, the petition must show that the personal estate of the deceased is insufficient to pay the debts of the estate.
    If, then, the two classes of creditors have equal rights, and taking it for granted that the creditor, whose claim being allowed within the two years, could not reach the land in question, we ask, by what authority is it that the creditor in this case, who slept upon his rights from the 10th day of December, 18d9, until the 26th day of August, 1878, can pass by the personal estate and reach the land of an innocent purchaser? If such is the law, then the statute rewards the negligent. We admit, had the personal estate been insufficient to pay all the just claims against the estate, then this claim would have shared pro rata in the property not inventoried; but we contend that when the personal estate is sufficient to pay all just debts, then it makes no difference whether the land is inventoried or not; it is beyond the reach of creditors, and the' heirs of the decedent are not liable for the debts of their ancestors by reason of’the inheritance of the land. Sec. 12, Chap. 59; McLean v. McBean, 74 Ill. 134; Guy v. Gericks, 85 Ill. 428.
    The statute, which is the only authority for an administrator to sell the land of a deceased person, makes no provision for a case as set forth in the petition, and we know of no authority for a court to make law not sanctioned by the lawmaking power.
    Messrs. G. & G. A. Koebneb, for defendant in error.
    This petition was filed under the amendatory act relating to administration of estates, approved June 15, 1887. While that act makes important alterations and gives extensive chancery powers to the Circuit or County Court, there is no substantial difference in that act as regards the provisions which the petition should set forth, from the act to which it is an amendment.
    But See. 100, Chap. 3, R. S., can have no application whatever to the case at bar. If it had, the 7th clause of section 70, Chap. 3, R. S., to wit, that “all demands not exhibited between two years from the granting letters testamentary shall be forever barred unless the creditor shall find Other estate of the deceased not inventoried or accounted for by the executor or administrator, in which case their claims shall be paid pro rata out of such subsequently discovered estate,” would be entirely nugatory.
    Administrations are usually settled and distribution ordered or made after the expiration of two years, the time allowed to present claims. It is manifest that the last mentioned section is made for the benefit of those creditors, who, for some reason or another, have failed to present their claims for allowance within the two years. This, however, does not prevent them from suing on their claims within the time not barred by the general statute of limitation, and obtaining judgment to be satisfied out of the estate not inventoried, whether then discovered or which may afterward be discovered. Thorn v. Watson, 5 Gilm. 26; Bradford v. Jones, 17 Ill. 93; Shepard, Adm'r, v. National Bank, 67 Ill. 292; Guy, Adm'r, v. Gericks, 85 Ill. 428.
    How, in all cases where the administration had been settled, the estate having been solvent, it would be impossible, in the petition for the sale of the property to satisfy the judgment obtained against property not inventoried, to allege that the estate was insolvent and there was an insufficiency of personal property. Ho remedy, then, would be provided, as contemplated by said Sec. 70.
    The petition alleges, and it is admitted both by the demurrer of Paul Henninger, Jr., as by the answer of Maria Yoelkel and the default of the other defendants, that the property was not discovered until the administration was settled; that suit was commenced in 1875, as soon, probably, as the property not inventoried was discovered. The defendants in this case are all heirs at law of Paul Henninger, deceased, and have taken the law subject to the contingencies mentioned. Stillmann v. Young, 16 Ill. 326.
    We hold that even a bona fide purchaser from them would be liable, but those défendants are not bona fide purchasers. They are bound to know the law—that land not inventoried would be liable to satisfy claims of creditors barred by the two years limitation.
   Phillips, J.

Defendant in error filed his petition in the Circuit Court of St. Clair county for a decree to sell land to pay debts, he being administrator de bonis non of the estate of Paul Nenninger, deceased. A demurrer was interposed to the petition, which was overruled. Certain defendants stood by their demurrer; one of the defendants filed an answer. A demurrer was interposed to the answer, which was sustained. A decree was entered for sale of land to pay debts. The defendants to that petition sue out this writ of error and assign as error the overruling of the demurrer to the amended petition, the sustaining of the demurer to the answer, and in entering a decree without finding facts in the decree.

The petition avers that Maria Wildig, executrix, etc., filed in the County Court of St. Clair county a certified copy of a certain judgment rendered in the Circuit Court of St. Clair county, which was so filed on the 3d day of June, 1881, and was for the amount of $1,750.22, and was recovered against Frederick Rhein, administrator, etc., of Paul Nenninger.

That judgment was to be paid in due course of administration out of any assets of the estate of Paul Nenninger discovered since the filing of the inventory of said estate by the administrator, and which assets the judgment finds are the lands referred to in the pleadings in the case, and then describes the lands. The petition makes a transcript of the judgment an exhibit, and avers that it was allowed by the County Court as a claim against the estate to be paid' in due course of administration out of subsequently discovered assets. The death of Frederick Rhein, the administrator, and the appointment of petitioner as administrator de bonis non is averred, and it is further averred that the estate of Paul Nenninger has been fully administered by said Rhein as administrator, and distribution of the personal estate had been made to the widow and heirs, and no other property, real or personal, had come to the petitioner except the land in the judgment described, which is averred to have not been inventoried.

The date of death of Paul Wenninger is not averred, nor can the date of granting letters of administration he determined from the petition. The date of the allowance of the claim is averred, but whether within two years of granting letters of administration on the estate of Paul Wenninger can not be determined from this petition. If the claim was allowed or judgment recovered within two years of the granting of letters of administration the fact of the distribution of the personal estate within two years would not authorize a sale of the real estate, except for a deficiency of personal assets. The petition is insufficient under Sec. 100 of Chap. 3, Starr & 0. 111. Stat., and under the amendatory act of 1887.

Wor is the petition sufficient under subdivision 7 of Sec. 70 Starr & C. Ill. Stat., or the amendatory act of 1887, as averring facts that would authorize a decree of sale of subsequently discovered assets to satisfy a claim allowed after two years from granting letters of administration. It was error to overrule the demurrer to the petition. We do not deem it necessary to consider the error assigned in sustaining the demurrer to the answer, as the petition is so insufficient that an answer thereto need not be considered. We suggest, however, that by Sec. 101 of Chap. 3, Starr & C. Ill. Stat, the practice in this class of eases is the same as in cases in chancery, and objection to an answer must be taken by exception.

The third assignment of error is that the decree is insufficient in not finding the necessary facts. That decree, after finding jurisdiction of the parties and sustaining the demurrers, enters default and a decree fro confesso, and the decree then proceeds: “It is therefore ordered, adj udged and decreed that the petition of the said Sebastian Fietsam, administrator as aforesaid, be allowed, and that the said administrator proceed according to law to advertise and sell the real estate described in said petition on such terms and conditions as are prescribed by the statute in such case made and provided, and that this case stand continued for report.”

The decree finds none of the facts, as required by Sec. 107, Chap. 3, Starr & C. Ill. Stat., nor is the decree sufficient under the amendatory act of 1887. Neither does the decree find sufficient facts in a case where claims are presented after two years from granting letters of administration to he paid out of subsequently discovered assets. The findings in the judgment against the administrator are not conclusive against the heir, and can not be held to aid either the want of averments in the petition or the finding necessary facts in the decree.

For the errors indicated the decree is reversed and the cause remanded.

Reversed and remanded.


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    Rockford Insurance Company v. Hugh L. Travelstead.

      Fire Insurance—Application—False Representations—Waiver—Acts qf A gent — Estoppel — Adjustment—Inconsistent Defenses—Pleading—Incomplete Bill of Exceptions.

    1. An insurance company which, with knowledge of fraudulent representations in an application, demands proofs of loss, is estopped from setting up such representations in defense of an action on the policy.
    2. Where an insurance company is estopped from setting up a given defense by acts of its adjuster amounting to a waiver, it can not escape liability through a condition in the policy limiting such agent’s authority to bind the company.
    3. Where one has an election between inconsistent courses of action, he will be held to that which he first adopts.
    4. The assignment of errors should be. attached to the record.
    5., In the case presented it is held: That the court below properly excluded the original application, which was not offered .until after the argument was commenced: that the service does not show false representations on the part of the plaintiff; and that the defendant is estopped from setting up a defense which is inconsistent with the acts of its adjuster.
    [Opinion filed March 1, 1889.]
    Appeal from the County Court of Williamson County; the Hon. W. W. Duncan, Judge, presiding.

      Messrs. Marshall & Taggart, for appellant.
    The policy had a copy of the application on the back thereof. The whole policy, including the copy of application, was set out in the pleadings in full, as well as read in evidence. In this copy the dollar mark was omitted from before the 84, and it was claimed in argument below that it did not mean an 84 dollar mortgage. The original a})plication had the dollar mark in. This was made a part of the policy by express reference. Upon this question being made in argument, the defendant below asked to introduce the original application,' which was excluded by the court—the court, however, holding that the copy should be construed the same as though the dollar mark were there, and giving instructions to the jury upon that theory. This is correct. Dollars are the units of our currency. The question asked called for the amount of incumbrance, and, taking the answer with the question, there can be no doubt but that the 84 should read as 84 dollars. In Beardsley v. Hill, 61 Ill. 358, “ one hundred and ninety-one, fifty cents” was construed to mean §191.50; and in Northrup v. Sanborn, 22 Vt. 434, the court held that 37.89 in an order meant §37.89. It was also claimed below that Mtge. did not mean a mortgage. This abbreviation is a very good one for the purpose, and, used in answer to an interrogatory about incumbrances, could hardly be mistaken.
    If the construction claimed below by the plaintiff were correct, there would still be a clear breach of warranty in the answer to question number 22 of the application. That a false statement as to the amount of the mortgage constitutes a defense, see Abbott v. Shawmut Ins. Co., 3 Allen, 213; Ryan v. Springfield F. Ins. Co., 46 Wis. 671; Pa. Ins. Co. v. Gottsman, 48 Pa. St. 151; Schumitsch v. Amer. Ins. Co., 48 Wis. 26; 3 N. W. R. 595.
    So far as we can learn, it has never been held that an insurance agent, who goes to examine a loss, must at once refuse payment on discovering a defense or estop his company from setting up such "defense. It is certainly for the interest of both parties that he should be allowed to go on and make the formal proofs of loss for the assured if he sees fit, and then refer the whole matter to the company. In this way the insured is neither misled nor prejudiced. The authorities, where it is held that the insurer is estopped from setting up a defense, all limit the doctrine to cases where the assured has been led by the-insurer to contract expense and been put to trouble. Webster v. Phœnix Ins. Co., 36 Wis. 71; Gans v. St. Paul Ins. Co., 43 Wis. 109; Titus v. Glens Falls Ins. Co., 81 N. Y. 410; Hollis v. State Ins. Co., 65 Iowa, 454.
    It has never been held that an adjuster away from the home office could waive a defense by taking proofs of loss. On the contrary, where the adjuster visited the property, gave insured blanks on which to make out his proofs, asked him to do so, leaving him to pay all expenses himself, and after receiving the proofs returned them for correction, it is the law that the company is not bound by his acts. Even if the court should inquire into the authority of adjusters and attempt to determine what powers they are held out as possessing, as a matter of public notoriety, it would find they had no power to do more than examine and report, as all blank drafts, receipts and papers used by or furnished to adjusters of this company, and we think so of all other companies, contain special provisions making the acts of the adjuster operative only upon approval of the company. The law is, however, that the authority of an adjuster to waive a defense by demanding proofs of loss must be expressly proved, and will not be presumed even from proof that he is an adjuster. Hollis v. State, 65 Iowa, 457.
    In this case we insist that there is no competent evidence that Dolan was an agent, certainly none tint he had any power to waive defenses. The policy sued upon is averred in the declaration to contain this provision:
    “2To agent or employe of this company or any other person or persons except the secretary, in writing, shall have the power or authority to waive or alter any of the terms or conditions of this policy.”
    This was notice to the assured that Dolan "did not have any such power. This provision has been sustained in Wisconsin, where there is a strong statute upon the subject of holding insurance companies responsible for all acts of agents; also in Michigan. Hankins v. Rockford Ins. Co., 35 N. W. Rep. (Wis.) 34; Cleaver v. Trader’s Ins. Co., 32 N. W. Rep. (Mich.) 660.
    Messrs. Clemens & Warder, for appellee.
   Phillips, J.

This is an action of assumpsit brought by appellee against appellant, on a policy of insurance. It is insisted in defense that the assured in his application made, false representations as to the title to the land and amount of land in the farm on which the insured buildings stood, and falsely represented the amount of a mortgage on the premises. The plaintiff, in reply, while denying the false representations, claims that the defendant company, with full knowledge of all the facts, demanded proofs of loss, which were furnished, and through its adjuster, Dolan, adjusted the loss at §400, and Dolan afterward repudiated the adjustment; the plaintiff claims that with full knowledge of all the facts. The demand for the proofs of loss, which were furnished, estojis the company from setting up the false representations. The insurance company denies the right of Dolan to waive any of the conditions of the policy and denies that the evidence shows him to be an agent of the company. A trial was had before a jury and a verdict was entered for §465; there was a remittitur of §23.15; motion for a new trial was overruled, and judgment entered for §441.85. The insurance company brings the record to this court by appeal.

The evidence shows that the appellee’s building and contents, the insured property, was destroyed by fire, and he at once gave notice to the company and was informed in reply that Mr. Dolan, an adjuster, would come and see about the matter. A short time thereafter appellee met Mr. Dolan and a meeting was appointed, to be held in Marion. Appellee came to Marion and met Mr. Dolan, and found he had full knowledge of appellee’s title to the lands, the number of acres, and the amount of the mortgage. With this knowledge Mr. Dolan asked for a statement of the property destroyed by fire in the building and a description of the building burned. The appellee then, with Mr. Dolan’s aid, made proof of loss. The same was sworn to by appellee before a justice of the peace and was delivered to and retained by the adjuster. Some propositions of a settlement of the loss were made and an agreement entered into by which the company was to pay $400. The adjuster then produced the premium note of appellee, and proposed to deduct that from the $100, to which appellee objected at the time, but subsequently consented, when Dolan then refused to pay anything. The evidence shows that when the company was notified of the destruction by fire of the insured property, the appellee was informed that an adjuster, Mr. Dolan, would call and investigate the matter. He subsequently did so and produced the premium note made to the company by the appellee. It was sufficiently shown that he was an agent of the company. Before the meeting at Marion he had called at appellee’s house, and in his absence, with the consent of a member of his family, had examined his papers and found he had title to forty acres of land, and a bond for a deed to thirty acres. He had also learned of the existence of an unrecorded mortgage and had called on the mortgagee and found the amount secured thereby. The appellant insists that the appellee in his application had made false representations as to the amount of the mortgage; the copy of the application indorsed on the policy was offered in evidence and contains, this question: “Is your property incumbered, if so, by what, in what amount, when due.” To which the answer is: “84 Mtge. on forty acres.” The mortgage on the forty acres of land is shown to have been made in 1886, and to secure a note for $148.03, due 18th of September, 1887, no part of which had been paid. We can not construe the answer to I the question above given as being an answer to more thai) that part of the question: “ Is your property incumbered ? If so, by what ? ” The answer, “ Mtge. on forty acres,” is in response to that question, and the “84” is meaningless, and must be rejected. The answer does not attempt to reply to that part of the question “ to what amount and when due.” It is insisted, however, in argument, that the original application contained the answer as follows: “$84 Mtge. on forty acres.” That original application was not in evidence and was not offered until after the argument of the case commenced, and when then offered, the court, on objection of appellee, refused to open the case and allow the same to go to the jury. It was not, therefore, in evidence, and can not be considered by us. From the evidence before the jury, we do not find the appellee made a false representation in response to that question. But if it is conceded that the answer of appellee was shown to be “ $84 Mtge. on forty acres,” and was . fraudulent, yet the evidence shows that with full knowledge of the facts, the agent of the company required of appellee full proof of loss, which was made. This must be held to estop appellant from setting up in defense such misrepresentation. German Fire Ins. Co. v. Grunert, 112 Ill. 68; Webster v. Phœnix Ins. Co., 36 Wis. 67; Gans v. St. Paul F. & M. Ins. Co., 43 Wis. 108.

It is, however, urged hv appellant that the reason for an estoppel in such case is that the insured must he put to expense in making proof of loss. It is shown that appellee took time to give the facts, make proof of loss and go before a justice to make affidavit to the same. The principle of estoppel is not based on expense incurred alone. It is said by Bigelow in his work on Estoppel, page 578, “A party can not occupy inconsistent positions, and where one has an election between inconsistent courses of action he will be confined to that which he first adopts. Any decisive act of the party, done with knowledge of bis rights and of ' the facts, determines liis election, and works an estoppel.” The evidence shows that the appellee answered the question, “ How much land do you own on which the property to be insured is situated,” by saying “ eighty acres,” and it is urged that this answer was fraudulent, as he had- a deed to but forty acres, and a bond for a deed to thirty acres. But the evidence shows that the adjuster, Bolán, had full knowledge of these facts at the time he required proofs of loss, and the principle of estoppel already discussed applies with equal force to this representation. The policy sued on contains this provision: “ Ho agent or employe of this company, or any other person or persons except the secretary, in writing, shall have the power or authority to waive or alter any of the terms or conditions of this policy;” and it is urged by the company that, the policy containing this provision, the assured had notice that Dolan had no power to waive or alter the conditions of the policy. Ho provision of the policy is changed, nor is anything added to it. The company employs its own agents, and if an agent employed and instructed with the discharge of a duty by the company requires an act of the assured which is inconsistent with the defense set up to avoid the liability claimed to exist by virtue of the policy, by reason of which the defense thus sought to be made is absolutely inconsistent with the act they have required of the assured, they will not be permitted to' engraft an additional condition in the policy to the effect that the assured shall not have the benefit of an estoppel in pais to a right that exists by virtue of the act of the company through its agent, and not merely by the terms and conditions of the contract.

The instructions to which objections are taken proceed on the theory of estoppel by reason of the company having knowledge of the facts, and thereafter demanding proofs of loss. It was not error to give them. The bill of exceptions in this case is incomplete in not furnishing copies of papers offered and referred to in evidence; nor does it appear by the certificate of the judge that it contains all the evidence. The assignment of errors is not attached to the record but made on a separate sheet of paper and placed in the record without being attached thereto. This is not in compliance with the rule, nor with the requirement of the law. Martin v. Russell, 3 Scam. 342; Gibbs v. Blackwell, 40 Ill. 51; Williston v. Fisher, 28 Ill. 43.

Finding no error in the record of which appellant may complain the judgment is affirmed.

Judgment affirmed.


author:
Mr. Justice MoSukely Hr. Justice O’Connor
      Matchett, P. J.,

text:
    The People of the State of Illinois, Defendant in Error, v. Benny Berof, Plaintiff in Error.
    Gen. No. 39,241.
    Matchett, P. J., dissenting.

      Opinion filed April 19, 1937.
    Rehearing denied May 3, 1937.
    W. G. Anderson and Charles A. Bellows, both of Chicago, for plaintiff in error.
    Thomas J. Courtney, State’s Attorney, for defendant in error; Edward E. Wilson, John T. Gallagher, Melvin S. Bembe and Blair L. Varnes, Assistant State’s Attorneys, of counsel.
   Mr. Justice MoSukely

delivered the opinion of the court.

Defendant, Benny Berof, was found to be in contempt of court in swearing falsely concerning his qualifications to act as surety on a bond and he was ordered committed to the county jail for 90 days; he seeks a reversal of the order.

A direct contempt consists of something done in the presence of the court tending to obstruct justice or lessen the dignity of the court. Such contempt may be punished summarily, without preliminary process. People v. Cochrane, 307 Ill. 126. As defendant was found guilty of a direct contempt we must consider the sufficiency of the order alone. People ex rel. Bain v. Feinberg, 266 Ill. App. 306; People v. Bain, 268 Ill. App. 192.

The order recites that on September 13,1936, Benny Berof was before the court while it was functioning as a court and offered to act as surety for the appearance before the court of Louis Swinberg; who was a defendant in the case of People v. Swinberg, charged with a criminal offense; that it was material to the acceptance of Berof as surety to examine and inquire as to his qualifications to act as surety and his sufficiency; that he was examined by the court and upon oath stated to the court that:

“He, the said Benny Beroff was worth over and above his liabilities the sum of $1,000.00; that he the said Benny Beroff was in the fruit and vegetable business ; that he the said Benny Beroff knew that the defendant Louis Swinberg’ had no record; that he the said Benny Beroff knew that the defendant Louis Swinberg had never been in trouble with the police, whereas in truth and in fact the said Benny Beroff then well knew that he was not worth over and above his liabilities the sum of $1,000.00 and the said Benny Beroff was then not worth over and above his liabilities the sum of $1,000.00 and so admitted to this Court in open Court, subsequent to the 13th day of September, 1936; and the said Benny Beroff, at the time he so presented himself as surety as aforesaid further well knew that he was not in the fruit and vegetable business, and that then and there he was not in the fruit and vegetable business and so admitted to this Court in open Court subsequent to the 13th day of September, 1936; and that the said Benny Beroff, at the time he so presented himself as surety, as aforesaid, well knew that defendant Louis Swinberg’ had a police record and had been in trouble with the police, and so admitted to this Court in open Court, subsequent to the 13th day of September, 1936; and that the said defendant Louis Swinberg then and there did have a police record and had been in trouble with the police. ’ ’

The order further found that Berof had knowingly and wilfully and falsely represented to the court the matters aforesaid, which were material to the investigation by the court, and that he has been guilty of direct contempt of court with the intention to embarrass and impede the administration of justice; the order also recited the presence of Berof in court. The order sets out the facts constituting the contempt and must be considered as true. Kneisel v. Ursus Motor Co., 316 Ill. 336.

In this court defendant says that September 13, 1936, fell on Sunday and that the court could not have been legally constituted on Sunday. There is no statute preventing* the municipal court of Chicago from functioning on Sunday, and it is well known that it is frequently necessary to receive bonds or to perform other emergency matters on Sunday. Baxter v. People, 3 Gilm. (Ill.) 368, 384; Johnston v. People, 31 Ill. 469.

The question whether an act which was physically committed outside of the presence of the judge is a direct contempt has been considered in a number of cases. In People v. Cochrane, 307 Ill. 126, the contempt was committed before the grand jury, out of the presence of the judge, and it was necessary to question the defendant to determine whether he was guilty of contempt. In People v. Andalman, 346 Ill. 149, the contemptuous act was filing papers with the clerk of the court contrary to the court’s orders. And in the recent case of In re Estate of Kelly, 365 Ill. 174, the contemptuous act was the filing of a spurious will with the clerk of the probate court. In each of these cases it was-held that the act was a direct contempt of court. In the instant case, however, the contemptuous act of swearing* falsely to the court was committed in the physical presence of the judge, as the order recites.

The principal question presented is whether false swearing* in a proceeding* before the court is punishable as contempt. It has been held that where the record shows that the falsity of the testimony of a witness was not known to the court at the time but that this was developed by a subsequent inquiry, a charge of direct contempt cannot lie. In People v. Stone, 181 Ill. App. 475, where the charge was giving false testimony, it was held that the record showed that this was not known to the court to be false until it was developed from a subsequent independent investigation and the conclusion of the court from this subsequent testimony. The opinion said that the court cannot judicially know that the evidence is false “unless at the trial it is so made to appear by the witness’s own admission or perhaps by unquestioned or incontrovertible evidence.” In People v. LaScola, 282 Ill. App. 328, the defendant gave testimony upon the trial of a criminal action tending- to support the claim of alibi; subsequently the court instituted a separate and independent inquiry as to the falsity of the testimony. We applied the rule stated in People v. Stone, supra, holding- that it was not within the personal knowledge of the court that LaScola had testified falsely until the court was subsequently apprised by testimony of LaScola and another witness. However, we said, “If LaScola had admitted on cross-examination that his testimony was false when testifying in the trial of Eogulich, a different question would be presented. ’ ’ All of these cases are concerned with false testimony given by a witness upon the trial of a case.

The present case is of different sort. The testimony of a witness on a trial is not involved. Here Berof presents himself as surety for the appearance of the defendant Swinberg to a criminal charge; to inquiries by the court as to material matters touching- his qualifications to act as surety Berof makes certain answers under oath; the bond being accepted to secure defendant’s appearance, presumably he is released. The sufficiency of a surety bond is continuously open for investigation, not as a separate and independent proceeding but as a continuation of the inquiry into its sufficiency. Upon further investigation Berof admits that he replied falsely to each and all the questions put to him touching his qualifications as surety.

The offense charged is the effort to embarrass and impede the administration of justice. Nothing could more effectively impede the administration of justice than to secure the release of one charg*ed with a criminal offense by answering falsely the questions touching the qualifications of the surety. In People v. Gard, 259 Ill. 238, a question put by the court to a police officer was not answered in audible words but merely by shaking his head, with the intention of conveying a negative answer which he knew was false; held: he was guilty of a direct contempt of court. The record shows the perpetration of a deliberate fraud upon the court and such an action deserves to be summarily punished for contempt.

For the reasons indicated the judgment is affirmed.

Affirmed.

O’Connor, J., specially concurs.

Hatchett, P. J., dissents.

Hr. Justice O’Connor

specially concurring: In People ex rel. Bain v. Feinberg, 266 Ill. App. 306, we held that where one is found guilty of a direct contempt of court, criminal in nature, committed in the presence of the court, a bill of exceptions (now a report of the proceedings of the trial) had no proper place in the record and that the sufficiency of the commitment must be determined from the order or judgment alone. In People v. LaScola, 282 Ill. App. 328, in which the charge was that LaScola was guilty of a direct contempt of court, criminal in its nature, we held that it was improper to hear extrinsic evidence to substantiate the charge. But I am unable to distinguish the case at bar from In re Estate of Kelly, 285 Ill. App. 143, affirmed 365 Ill. 174, and therefore concur in the affirmance of the judgment.

Matchett, P. J.,

dissenting: As I see this ease it is essentially different from the Kelly case. In the Kelly case the contempt of which the defendant was found guilty consisted of filing a spurious will for probate in the probate court. This defendant is found guilty not of filing a spurious bond but of giving false testimony with reference thereto, concerning matters which were not and could not be within the personal knowledge of the judge. The case, therefore, seems to me in effect to overrule People v. LaScola, 282 Ill. App. 328, and for the first time, as I understand it, to hold in effect that a trial judge may punish summarily as for direct contempt a witness who in his opinion is guilty of swearing falsely before him. In People v. Hogan, 256 Ill. 496, the opinion was careful to state that it should not be inferred therefrom that “a court can in any case, upon its own knowledge of the facts, punish summarily as for a contempt against the dignity of the court, a witness who has testified falsely in a cause.” I think the precedent now established most dangerous in that the summary commitment was made upon a supposed admission in the nature of a confession and for a direct contempt in which proceeding a majority of this court has heretofore held that a defendant is not entitled to a bill of exceptions. People ex rel. Bain v. Feinberg, 266 Ill. App. 306; People v. Bain, 268 Ill. App. 192. In the Kelly case that right was permitted the defendant.


author: Mr. Justice McSurely

text:
    Gustavo G. Gallopin, Appellant, v. Continental Casualty Company, Appellee.
    Gen. No. 39,258.
    Hatchett, P. J., dissenting.
    Opinion filed April 19, 1937.
    Rehearing denied May 3, 1937.

      Lou Nathahsow, of Chicago, for appellant; Joseph J. Ticktih, of Chicag’o, of counsel.
    G-eorge C. Bliss and Abraham Lepine, both of Chicago, for appellee.
   Mr. Justice McSurely

delivered the opinion of the court.

Plaintiff recovered a judgment of $1,000 against W. A. Blinn, Jr., because of his negligent driving of an automobile which belonged to the Illinois Hertz Drivurself Stations, Incorporated. Plaintiff brought the instant suit to recover the amount of this judgment on defendant’s policy of insurance, and upon trial by the court the judgment was against him, from which he appeals.

Under the Motor Vehicles Act, Ill. State Bar Stats. 1935, ch. 95a, par. 47(1), the owner, being in the business of renting out motor vehicles, is obligated to place on file with the Secretary of State a motor vehicle liability policy. By the terms of this policy the defendant became liable to “pay and satisfy within thirty days after it becomes final any judgment rendered against said owner and/or customer, and/or person operating such motor vehicle with the customer’s express or implied consent ...” for injury or damages to property. (Note the “and/or” — a kind of verbal teratism.)

Plaintiff argues that by this policy defendant is obligated to him for the payment of the $1,000 judgment against Blinn. Defendant argues that it becomes liable only for accidents occurring while the motor vehicle is operated by a customer of Hertz, the owner, or any person operating it with the customer’s express or implied consent, and says that Blinn was not operating the automobile with the express or implied consent of a customer.

The supervisor of the Hertz Station testified that when a person applies for a car he is given an application blank to fill out with his name, his address, occupation, description and his signature; they then check up on this application and if the applicant is O. K. his name is placed on a register of customers and an identification card is mailed him; a person wishing to rent a car must display the identification card and sign a rental ticket; cars are rented only to persons having identification cards.

The name of M. Dowden was on this list of customers. Dowden testified that one day while on the beach he took off his coat and laid it down and engaged in a game of ball; that he had his identification card in the pocket of his coat but that the next day when he looked for it it was gone; Charles Ernst was seen on the beach while Dowden was there; Ernst was not on the list of customers of the Hertz Station, but on September 23, 1929, the day Dowden lost his card, Ernst applied to the Hertz Station for a car; he told the manager of the station that he was Dow-den; the manager looked through, their list of customers and found the name of M. Dowden; Ernst had in his possession the identification card made out to Dowden and presented it to the manager and signed a receipt for the car in the name of M. Dowden; it also appears that Ernst, by these means, got possession of the car at the request of his friend, Blinn, who wanted a car to take some girls riding; Blinn furnished the $10 deposit Ernst made with the Hertz Station, to be applied on the rental of the car; Blinn says that he had Ernst do this for him as he, Blinn, was a minor and knew that the Hertz station would not let him have a car. Ernst and Blinn rode off with the car and after Ernst was taken to his home Blinn proceeded with his ride, during which he collided with the car driven by the plaintiff, Grallopin. Plaintiff brought suit against Blinn, who did not appear and permitted judgment of $1,000 to be entered against him by default.

The court properly found as a fact that on the day the car was taken the Hertz Station did not have a customer by the name of Charles Ernst and that Ernst obtained possession of the automobile by falsely representing1 to the Hertz station that he was a customer by the name of M. Dowden and by signing the name of M. Dowden to the rental agreement.

It is conceded that Blinn was driving the automobile with the consent of Ernst. The question is, Was Ernst a “customer” of the Hertz Stations as that word is used in the policy sued on?

The rule construing insurance policies most strongly against the insurer in case of ambiguity is not applicable to provisions of a policy prescribed by statute. The language of the policy imposing1 liability (except as to the senseless “and/or”) follows precisely the language of the statute. The rule does not apply when the wording is not that of the insurer but is taken from the statute. MacBey v. Hartford Accident & Indemnity Co., ■ — ■ Mass. ■ — ■, 197 N. E. 516; Frozine v. St. Paul Fire & Marine Ins. Co., 195 Wis. 494, 218 N. W. 845; Sturgis Nat. Bank v. Casualty Co., 252 Mich. 426, 233 N. W. 367. The opinion in North West Cab Co. v. Central Mut. Ins. Co., 266 Ill. App. 192, is not to the contrary. In that case was involved only the question of the territory covered by the policy.

Plaintiff cites a number of cases which seem to hold that in case of a sale of personal property the seller contracts with the individual who stands before him although such individual represents himself as someone else. In the instant case there was no sale of the automobile to Ernst and no question involved of passing title to Mm, wMch was the question in the cases cited. Here we have a temporary rental under an agreement bearing the signature of M. Dowden, defendant’s customer, which provides that it is a contract of renting only and not of sale and that the renter will return the automobile in as good condition as it was when received by him and will comply with all of the conditions in the insurance policy applying to the automobile; also pay the cost of replacing any damage to the vehicle while rented, except where the customer satisfies the owner that he was free from all negligence.

These provisions of this rental agreement emphasize the necessity that the renter should be on the list of customers, with an identification card issued after an investigation which satisfied the Hertz Stations that the renter was a fit and proper person who would comply with the provisions of the rental agreement.

In 13 C. J. 378 is a general statement that, “There is no agreement where one party enters into the contract under a mistake as to the identity of the other party as where the party contracted with has falsely represented himself to be another . . . . ” See also Langdon v. Hughes, 113 Ill. App. 203; Arkansas Smelting Co. v. Belden Co., 127 U. S. 379, 387, 388. Benjamin on Sales (7th ed.), sec. 433, says in substance that whenever g*oods are obtained from their owner by fraud it must be distinguished whether there was a sale to the party guilty of the fraud or a mere delivery of goods induced by fraudulent devices. Phelps v. McQuade, 220 N. Y. 232, upon which plaintiff seems to place much reliance, was a case of selling goods to the person with whom the seller dealt. But in Morgan Munitions Co. v. Studebaker Corp., 226 N. Y. 94, where an impostor secured employment from the defendant to sell munitions, and suit was brought to recover commissions on sales by the impostor, the court held there could be no recovery as under the circumstances there was no contract.

Moreover, it is a well recognized principle that where a contract is entered into by two parties for the benefit of a third, the third person’s rights are subject to the equities between the original parties springing out of the transaction between them. Revell & Co. v. Morgan Grocery Co., 214 Ill. App. 526; Restatement of the Law of Contracts, vol. 2, p. 910. The right of plaintiff to recover on the contract of insurance is necessarily based upon the legal right of Ernst, if any. If Ernst was not a “customer” of Hertz Stations then plaintiff has no enforceable rights against defendant, as his right to recover depends upon the right that Ernst acquired as a legal, valid customer of Hertz Stations. If Ernst was not a customer then he could not legally consent to the operation of the automobile by Blinn.

Cases cited by plaintiff to support the claim that Ernst was a customer are not helpful. Roberts v. Central Mut. Ins. Co., 285 Ill. App. 408, involved the question of whether the operator of the automobile was guilty of fraud in failing to co-operate with the insurer in the defense of the personal injury suit. General Casualty & Surety Co. v. Stevens, 41 Ohio App. 581, 180 N. E. 271, involved the rental of a car to a minor who misrepresented his age when renting the car; it was held that the policy of insurance covered the liability of the operator of the rented car by one who signed a contract with the renting company. In Guzenfield v. Liberty Mut. Ins. Co., 286 Mass. 133, 190 N. E. 23, the automobile was operated by the judgment debtor with the consent of an employee of the owner, the assured named in the contract of insurance. Other cases cited by plaintiff can be distinguished.

A case somewhat similar in its facts is Rondina v. Employers’ Liability Assur. Corp., 286 Mass. 209, 190 N. E. 35. There Kerwin, the owner of the automobile, registered it in the name of Sanborn and caused a policy of insurance to be issued in Sanborn’s name although he had no interest in the automobile nor any knowledge that it was registered in his name ; at the time of the accident Maher, with the permission of Kerwin, was driving the automobile; it was held that Maher Was not covered by the motor vehicle liability insurance policy for the reason that he was not operating the automobile at the time of the accident with the express or implied assent of the named assured.

Applying this to the instant case, when. Ernst obtained the automobile from the Hertz Station, giving his name as M. Dowden, automatically the contract of insurance in question would cover M. Dowden, the person named in the rental agreement, and when Ernst permitted Blinn to operate the automobile it was not driven with the consent of M. Dowden for whose benefit the insurance policy ran.

In Leonardo v. De Vellis, — Mass. —, 198 N. E. 264, the court had occasion to construe the Massachusetts compulsory motor vehicle insurance statute. There plaintiff recovered a judgment against Louise De Vellis for injuries sustained in an automobile accident; the real owner was Thomas De Vellis but the certificate of insurance ran to Louis D. De Vellis; the court held there was no liability of the insuring company, as the policy was issued to a person other than the judgment debtor. In the opinion the court uses this language: “The statutes, however, do.not purport to make available to a judgment creditor the. proceeds of a liability policy unless the judgment debtor falls within the definition of one assured under the terms of the policy. It is not within the contemplation of the statute that every person injured by the operation of the motor vehicle in all circumstances and by any person shall be entitled to the benefit of the insurance policy.” Another Massachusetts case is MacBey v. Hartford Accident & Indemnity Co., — Mass. —, 197 N. E. 516, where the general rule for the interpretation of compulsory liability policies is stated, to the effect that all words must be construed according to the common and approved usage of the language. The word “customer” must be construed in the ordinary understanding of the word. Originally the word implied one who repeatedly did business with another.. But repeated dealings aré not always necessary to make one a customer.

In the instant case the Hertz Stations, for the purpose of protecting itself from irresponsible persons and to insure compliance with the provisions of the rental agreement, after a preliminary investigation of an applicant and a satisfactory report, adds his name to its list of customers — persons to whom it is willing to rent its cars; it will not rent a car to one whose name does not appear on this list; Ernst evidently knew that if he applied in his proper person for a car he would be refused; having- come into possession of Dowden’s card by means which are questionable, he imposes on Hertz Stations by pretending to be Dowden and supported this misrepresentation by exhibiting this identification card and signing the rental agreement in Dowden’s name. Under these circumstances we are of opinion that Ernst was not a customer. If one had obtained a car from the Hertz Stations without its knowledge or consent, could it be said that he was covered by defendant’s policy in the event of liability for an accident? Manifestly not. By the same reasoning Ernst, the impostor, was not covered by defendant’s policy. As Blinn was not driving the car at the time of the accident with the consent or permission of a customer, there is no liability under the policy.

We are of the opinion the conclusion of the trial court was proper, and the judgment is affirmed.

Affirmed.

O’Connor, J., concurs.

Hatchett, P. J., dissents.