text:
    Crawford B. Murton, appellant, v. Ernest Humphrey and L. N. Rolle, trading as Springfield Fruit Supply Company, appellees.
    Gen. No. 8,831.
    Opinion filed June 15, 1934.
    Geo. P. Coutrakon and Gillespie, Burke & Gillespie, for appellant. Michael Eckstein, for appellees.
   Mr. Justice Davis

delivered the opinion of the court.


source: Caselaw Access Project

author: Mr. Justice Davis

license: Public Domain

text:
    Glenn O. Rau, appellee, v. Farmers Grain Company at Chestnut, Illinois, appellant.
    Gen. No. 8,835.

      Opinion filed June 15, 1934.
    Covey & Woods, for appellant. John R. Fitzgerald and Harold F. Trapp, for appellee.
   Mr. Justice Davis

delivered the opinion of the court.


author: Mr. Justice Fulton

text:
    Polly Ottwell, by W. R. Donohoo, her conservator, appellee, v. National Fire Insurance Company of Hartford, Connecticut, appellant.
    Gen. No. 8,830.
    Opinion filed June 15, 1934.
    Williams & Williams, for appellant. Edwin Johnston, for appellee.
   Mr. Justice Fulton

delivered the opinion of the court.


author: Per curiam.

text:
    John E. Sharp, appellee, v. Frank U. Patterson, appellant.
    Gen. No. 8,797.
    Opinion filed June 15, 1934.
    Rehearing denied July 17, 1934.
    Carey E. Barnes, for appellant. Brown, Hay & Stephens, for appellee; Robert A. Stephens, Jr., of counsel.
   Per curiam.


author: Mr. Presiding Justice Edwards

text:
    Fourth District.
    The People of the State of Illinois ex rel. Oscar Nelson v. Bank of Noble. E. B. Ring, plaintiff in error, v. Charles E. Palmer, defendant in error.
    Opinion filed June 4, 1934.
    Donovan D. McCarty, for plaintiff in error. No appearance for defendant in error.
   Mr. Presiding Justice Edwards

delivered the opinion of the court.


text:
    Wilhelmina Spaet, plaintiff in error, v. City of Alton, defendant in error.
    Opinion filed June 4, 1934.
    Ferdinand Tunnell, for plaintiff in error. Virgil M. Jacoby, for defendant in error; Wm. P. Boynton, of counsel.
   Mr. Presiding Justice Edwards

delivered the opinion of the court.


author: Mr. Justice Murphy

text:
    Elisabeth Rubin, appellant, v. August Graumenz, executor of the last will and testament of Henry Knecht, Sr., appellee.
    Opinion filed June 4, 1934.
    Rehearing denied August 27, 1934.
    Webb & Albert, for appellant. Matheny & Welker, for appellee; J. G. Burnside, of counsel.
   Mr. Justice Murphy

delivered the opinion of the court.


text:
    Road District No. 3, appellant, v. John Uffelmann, appellee.
    Opinion filed June 4, 1934.
    Rehearing denied August 27, 1934.
    J. Fred Gilster, for appellant. Wm. H. Sehuwerk, for appellee.
   Mr. Justice Murphy

delivered the opinion of the court.


text:
    Abner Carey, appellant, v. Altamont Manufacturing Company, appellee.
    Opinion filed June 4, 1934.
    Rehearing denied August 27, 1934.
    B. J. Kolb and Paul Taylor, for appellant. Parker & Bauer, for appellee.
   Mr. Justice Murphy

delivered the opinion of the court.


author: Mr. Justice Stone

text:
    Estate of William Longwisch, deceased, appellant, v. Julia Longwisch, by Frances Gueltig, her conservatrix and next friend, appellee.
    Opinion filed June 4, 1934.
    Rehearing denied August 27, 1934.
    Ferdinand Tunnell, for appellant. C. W. Terry and M. D. Powell, for appellee.
   Mr. Justice Stone


author: Mr. Presiding Justice Hall

text:
    The People of the State of Illinois ex rel. Thomas B. McSweeney, Appellee, v. Richard J. Collins et al., Appellants.
    Gen. No. 36,558.
    Wilson, J., dissenting.

      Opinion filed June 20, 1934.
    William H. Sexton, Corporation Counsel, and Frangís J. Vurpillat, Assistant Corporation Counsel, for appellants.
    Crow & Loeff, for appellee.
   Mr. Presiding Justice Hall

delivered the opinion of the court.

This case was decided at the March term of this court and a rehearing granted.

By this appeal, defendants seek the reversal of a judgment in a mandamus proceeding, directing the civil service commission of the City of Chicago to . place the names of petitioners in advanced positions on the list of eligibles for appointment as calker, because of the fact that they are war veterans, and, therefore, entitled to such advancement. Three similar suits were instituted upon the relation of three other persons named Calhoun, Clements and Gavin, occupying positions relatively the same as relator here. The same order was entered in the four cases, they are all here on appeal, and they have been consolidated for this hearing. The numbers of the cases here are 36,558, 36,559, 36,560 and 36,561. The hearings were had in the court below on what are termed second amended petitions filed by each of these persons on May 17,1932, to which respondents filed general demurrers, which were overruled, and respondents elected to stand by their demurrers. The order of the court from which this appeal is taken indicates that various persons, not veterans, but listed as eligibles, and made parties to the petition of these petitioners, after being granted leave by the court, filed intervening petitions to these petitions, to which intervening- petitions demurrers were filed by respondents. By order of the court, these demurrers were overruled, appeals were taken from this portion of the order, but not perfected, so that they need not be considered here.

Prior to filing the petitions on May 17, 1932, Gavin and the other persons here mentioned, together with a number of others on December 4, 1931, filed a joint petition in the circuit court of Cook county, seeking in effect the same relief as- is sought here. To this petition, general and special demurrers were filed, in which the point was raised that there had been a misjoinder of parties. Thereafter, this last mentioned petition was dismissed on motion of the attorneys for the petitioners. The record also indicates that on April 16, 1932, petitioners MeSweeney, Calhoun, and Clements filed petitions in the circuit court of Cook county, all seeking relief similar - to that sought by the amended petitions filed May 17, 1932. This opinion will cover the four cases.

The petitions recite in substance that the petitioners are citizens of the United- States, and residents of the City of Chicago, county of Cook, State of Illinois; that during the year 1895 the City of Chicago adopted an Act of the Legislature of the State of Illinois, “An Act to regulate the civil service of cities,” approved and in force March 20, 1895, as amended, and that the Act is now in full force in the City of Chicago; that the civil service commission, of which defendants are members, is the civil service commission created under said Act, and that this civil service commission had adopted certain rules as provided by the Act, which rules are now in full force and effect; that section 10% of the Civil Service Act referred to, Cahill’s St. ch. 24, If 695, provides generally that'persons who were engaged in "the military or naval service of the United States during certain years shall be preferred for appointment to civil offices, provided they are found to possess the capacity necessary for the proper discharge of the duties of such office, and it shall be the duty of the examiner or commissioner certifying the list of eligibles who have taken the examinations provided for in this Act, to place the name or names of such persons at the head of the list of eligibles certified for appointment. The petitioners furnished proof of their military service, they successfully passed the required examinations for the position or place of employment as calker, and classified in the public service as Branch II, Class H, Grade 3, Grade A, which is appropriated for this classified service. These examinations were held on July 28, 1930, and August 26, 1930, for all the persons involved, and the eligible list of the successful candidates who took the examinations at these times was posted on December 26, 1930. The proof of military service of the petitioners was filed with the secretary of the civil service commission on December 31, 1930. These four persons were given their respective places on the eligible list, together with some 51 other applicants who had passed the civil service examination for the position mentioned, 21 of whom were veterans and 30 of whom were not.

The theory of petitioners is that a veteran honorably discharged from the military service is entitled to have the list, as made up by the civil service commission, altered by order of the court, so that their names will be placed in an advanced position on this certified list, in order that they may receive appointment ahead of the others on such list. In making up the list referred to, the names, of all those posted were distributed promiscuously throughout the list, without regard to whether they were veterans or not. It is not suggested that petitioners have not received employment but that they have been deprived of their right to employment according to their proper standing."

The defendants claim that inasmuch as the eligible list resulting from the examination was duly posted on December 26, 1930, that petitioners filed no proof of service or honorable discharge until December 30, 1930, that they made no protest against the posting of the eligible list at the time of such posting, that they apparently acquiesced in such listing, that they did not bring their original actions until the times mentioned, nor file their .amended petitions upon which the hearing was had until May 17, 1932, almost a year and a half after the posting of the eligible list, that they have, therefore, been guilty of laches and that these actions should not prevail.

Appellees’ positions seem to be that the Civil Service Act was adopted primarily for the benefit of persons employed by such governmental bodies as the City of Chicago. Such is not the case. To procure improvement in civil service is the main purpose of such enactments, and the protection of civil servants in their tenure of office or employment is collateral to the main purpose. In 5 Ruling Case Law, page 608, the purpose and scope of civil service laws is stated as follows:

“The civil service laws, a recent development in government, were designed to eradicate the system of making appointments primarily from political considerations with all its attendant evils of inefficiency and extravagance, and in its place to establish a merit system of fitness and efficiency as the basis upon' which appoiintments to the civil service should fiei made. Such laws substitute for the uncontrolled will of the appointing officer the results of competitive examinations, and require that appointments to office be made from among those who have shown themselves by examination to be best qualified for positions in the civil service, and, as might be supposed, result generally in improvement in the public service from the experience and proficiency acquired through merit, and in a tenure of office which is independent of political favor.” (Italics ours.) .

In People ex rel. Hansen v. Collins, 351 Ill. 551, in an opinion of the Supreme Court of. Illinois, a similar situation. was- presented to that presented here. In that case, the relator, had been in the naval service of the United States, and had passed, the examination before the civil service commission of Chicago for employment as a carpenter. Other persons took the same examination, some of whom were- -veterans and some of whom were not. The relator, was certified for employment and served the probationary period of six months. All the successful applicants had served a like probationary period.. In that case,- the relator insisted that- regardless of priority in the entry of service, veterans should.be the last to be temporarily discharged and the first to be recalled to work, and the Supreme Court said:

“There is neither Statutory .provision nor implication giving a preference to veterans over other employees who are strangers to the military or naval service, either to retain employment whenever the necessity for temporary discharges from work arises, or to be recalled before' such other employees. whenever the necessity for temporary ■ releases from employment ceases.” 6

As stated, after these petitioners had taken the examinations, as provided by law, their names were posted on the eligible list oh December 26, 1930, and they furnished proof of their military ■ service on December 31, 1930, which' gave them the right to priority of listing, which they seek to procure by order of the Court in this proceeding. From the record it appears that none of them took any steps to assert this right until December 4, 1931, nearly a year after such right, accrued, when these petitioners, with others, filed their -petitions-. This petition was dismissed on their motion. Afterwards, on April 16,1932, as stated, the petitioners, MeSweeney, Calhoun and Clements filed petitions, which were apparently abandoned, and on May 17, 1932, almost a year and a half after the posting of this eligible list, the four amended petitions in question were filed. No reason is given for these delays.

In Schultheis v. City of Chicago, 240 Ill. 167, a petition was filed in the superior court of Cook county against the City of Chicago and certain of its officers for the purpose of having the name of the petitioner restored to the police pay roll, from which he was dropped on March 14, 1898. The original petition was filed March 11, 1903. Amended petitions were filed thereafter. The City of Chicago, respondent, urged that the relator had been guilty of laches. In passing upon the question as to whether or not laches could be urged as a defense, the Supreme Court said:

“It is urged in support of the demurrer that it appears from the petition as finally amended that the petitioner was guilty of such laches in bringing his action as barred any right that he might otherwise have had, and this contention finds support in the case of Kenneally v. City of Chicago, 220 Ill. 485, which is squarely in point. Kenneally and Schultheis were both appointed policemen of the city of Chicago in 1888. The names of both were dropped from the police payroll on the same day, March 14, 1898. Kenneally filed his original petition for mandamus on January 24, 1900. Schultheis filed his original petition for mandamus on March 11,1903. Kenneally filed his amended petition, to which a demurrer was sustained and by which he elected to abide, on December 19, 1904. In the Keimeally case we held that the appellant had been guilty of such laches as authorized the .trial court to sustain the demurrer to the petition, and if that case be followed on the question of laches the judgment in the case at bar must be affirmed, as .no attempt is made by the petitioner’s pleading to show any excuse for the delay. Schultheis is represented by the same counsel who represented Kenneally, and they argue that the earlier case is wrong. We have upon their insistence again examined the questions involved and deem it necessary to notice in this opinion but one criticism of the former case. It is asserted with great vigor that laches cannot be relied upon as a defense in any suit at law, and it is said, to quote the language of counsel, ‘Laches is a defense which may be interposed in a court of equity only.’

“This is a mistake. Cases are common in this court in which laches has been regarded as affording a defense in proceedings in quo warranto and in proceedings in certiorari, both of which are at law. Clark v. City of Chicago, 233 Ill. 113; City of Chicago v. Condell, 224 id. 595; People v. Hanker, 197 id. 409; Trustees of Schools v. School Directors, 88 id. 100; People v. Schnepp, 179 id. 305.

“In the case ■cited from the 233d we held that a member of the Chicago police force claiming to have been wrongfully removed ivould be barred by laches from his right to have the record of the civil service commissioners reviewed by certiorari if he delayed more than six months in beginning his suit unless the delay was satisfactorily explained by the petition for the writ. We are satisfied that we should, adhere to the Kenneally case.” (Italics ours.)

In People v. City of Chicago, 147 Ill. App. 591, this court held that a delay of 10 months between the discharge of a patrolman and an application by mandamus for restoration will bar the issuance of the writ.

In People v. City of Chicago, 148 Ill. App. 96, this court held that a delay of nine months in a similar case was fatal.

We are of the opinion that the petitioners were guilty of such laches as will bar their right to the relief prayed.

In view of the fact that the questions involved here are important to the City of Chicago, and to the various civil service employees, a rehearing of this case was granted. However, after an examination of the whole record submitted, together with the authorities, we are of the opinion that the original opinion as here modified should prevail, and that for the reasons stated the judgment of the circuit court should be reversed.

Reversed.

Hebel, J., concurs.

Wilson, J., dissents.


text:
    Alexandra Kozien, Appellant, v. Jozef Vikidal et al., Appellees.
    Gen. No. 36,790.
    Opinion filed June 20, 1934.
    Rehearing denied July 9, 1934.

      Heile, Cavender, Milohrist & Kaiser and Theodore J. Szmergalski, for appellant.
    Nicholas A. Pope, for appellees; Richard E. Dooley, of counsel.
   Mr. Presiding Justice Hall

delivered the opinion of the court.

Complainant, Alexandra Kozien, filed her bill in the superior court of Cook county to foreclose a trust deed given to secure a note for the sum of $6,000, dated May 30, 1928, due and payable three years after the date thereof, with interest at the rate of seven per cent per annum, evidenced by interest notes. Both principal and interest notes were made payable at the office of Konrad Ricker who made the loan. The principal note and a trust deed to Konrad Ricker, trustee, together with the interest notes, were executed by the defendants, Jozef Vikidal and Katerina Vikidal, his wife. Defendants filed a plea in which it was alleged that the principal and interest notes had been paid in full to Konrad Ricker, the trustee in the trust deed, who, the plea alleges, was the agent of the legal holder and owner of the trust deed and notes, and authorized and empowered to receive the payments so made for and on behalf of the legal holder and owner of the trust deed and notes, who did not appoint any other place of payment, or request defendants to make payment to her, and that Konrad Ricker, as such trustee in the trust deed, had executed and delivered to the defendants ,a deed releasing all rights under such trust deed.

The cause was referred to a master on the issues raised by the plea. The master heard the evidence and reported and found that the note for $6,000 remained wholly unpaid and recommended that the plea of payment be overruled and a decree of foreclosure entered. Upon a hearing on exceptions filed to the master’s report, the court sustained the exceptions and entered a decree finding that the note had been paid in full, and dismissed the bill for want of equity.

There seems to be little dispute about the facts in the case. The note for $6,000, secured by the trust deed, was executed, as alleged, and, by its terms, matured on May 30, 1931. The note and trust deed were purchased from Ricker by the complainant in May, 1928. On July 3, 1930, the defendants paid Ricker, the trustee, $3,000, on November 29, 1930, $1,000, and on July 10, 1931, $2,000 on account of principal, the first two payments having been made before the maturity of the note. All instalments of interest were paid by the defendant to Ricker, and by him paid to the complainant. The interest notes were surrendered by the complainant to Ricker upon the receipt of payments thereof from him. The interest was paid to the complainant by Ricker for a year after the note became due, but the complainant had no knowledge of any of the payments having been made on account of the principal. Complainant was in possession and control of the principal note and trust deed during all of the time after they were purchased by her. On June 2, 1932, without knowledge of the complainant, Ricker executed and delivered to defendants a release deed, releasing the lien of the trust deed. This deed was recorded by Ricker. Complainant and defendants never met until after all of the payments had been made to Ricker. It is the contention of the complainant that Ricker had no authority to receive payment of any part of the principal of the $6,000 note secured by the trust deed, or to release the trust deed. It is the contention of defendants that Ricker was the agent of the complainant in making the collections and that .payment of the money to Ricker constituted payment of the notes, and that complainant was negligent in that she did not, after the purchase of the trust deed and notes, give notice to the defendants that she had made such purchase and give defendants direction as to future .payments.

There was no answer filed .to the bill here. Defendants’ plea is “that such payments made by the defendants were made to Ricker, who was then and there the agent of the legal holder and owner of the trust deed and notes, and who was then and there authorized and empowered to receive for and on behalf of the legal holder and owner of the said trust deed and notes the aforesaid payments made by the defendants, who did not appoint any other place of payment; that the complainant never informed or requested defendants to make their payments at any other place, and that the defendants received their interest coupons marked paid by said Konrad Ricker at his office; that in and by said release deed and payments, said indebtedness sued upon by complainant is wholly paid, discharged and satisfied.”

In Straley v. House of Good Shepherd, 281 Ill. 604, the Supreme Court said concerning a plea to a bill in chancery: “In order to be a good plea it must be either an allegation or a denial of some leading fact, or of matters which, taken collectively, make out some general fact which is a complete defense. (Story’s Eq. Pl. — 10th ed. — sec. 652.)”

In Spangler v. Spangler, 19 Ill. App. 28, this court said: “A plea to a bill in chancery is proper whenever the defendant wishes to reduce the cause, or some part of it, to a single point, and from thence to create a bar to the suit. Smith’s Chancery Practice, Vol. 1, page 216; Story’s Equity Pleading, sec. 652. Pleas in chancery are pure pleas and pleas not pure. Pleas not pure are sometimes called negative pleas— Ibid. Sec. '651. It was formerly doubted whether a purely negative plea was a legitimate mode of defense in equity; but that doubt has been dissipated, and it is now firmly established that such a plea is good — Ibid. 668. In sec. 652, supra, the author says: ‘The true end of a plea is to save to the parties the expense of an examination of witnesses at large. ’ ”

Defendants cite the case of McAuliffe v. Reuter, 166 Ill. 491, and many other cases as authority for the proposition that an assignment of a chose in action, other than a negotiable instrument, does not protect the assignee as against the equities between the original parties, without notice of the assignment to the debtor, and that in the event of a foreclosure by the assignee of a trust deed without such notice the mortgagor may interpose any defense arising out of the transaction with the mortgagee which he could set up against the mortgagee in case the bill were filed by the mortgagee. In McAuliffe v. Reuter, supra, McAuliffe had borrowed $600 from one Niehoff, giving a mortgage on real estate as security, and had paid the debt in instalments which were entered in a passbook, and when the debt was paid, the note and mortgage were returned to McAuliffe. Thereafter, McAuliffe borrowed a further sum of $1,000 from Niehoff, evidenced by a note for that amount due in three years from date, payable to McAuliffe and indorsed by him in blank. McAuliffe at the same time and in the same manner executed six interest notes payable semiannually and delivered all of them to Niehoff, together with a trust deed on his home, such trust deed being made to secure the loan, in which Niehoff was named as trustee. McAuliffe and Niehoff had an agreement that McAuliffe should pay this loan in instalments in the same manner as the $600 loan had been paid. Niehoff was a private banker, and as McAuliffe made his instalment payments at Niehoff’s bank, these payments were not credited on McAuliffe’s note, but were entered to McAuliffe’s credit in a passbook which he carried. The evidence in that case indicated that neither McAuliffe nor certain members of his family, who at times made these payments, ever saw the note or mortgage at the time the payments were made. It developed that shortly after the note and mortgage had been given to Niehoff, Niehoff had sold and delivered them to Beuter, who filed the bill to foreclose the mortgage. A decree was entered ordering the property sold, which decree was affirmed in the Appellate Court. From the judgment of the Appellate Court, an appeal was taken to the Supreme Court. The Supreme Court reversed the decree of the Appellate Court, and said:

“As Beuter obtained the note from Niehoff before its maturity, for a valuable, consideration and without notice of any of the alleged equities between the maker and Niehoff, in a suit upon the note McAuliffe would have no defense. But this is a suit to foreclose the deed of trust as a mortgage, and the law is well settled in this State that in such a suit, as a mortgage is a mere chose in action not negotiable, the mortgagor without notice of its assignment may interpose any defense arising out of the transaction with the mortgagee which he could set up against the mortgagee in case the bill were filed by him. This rule was announced in this State by this court in Olds v. Cummings, 31 Ill. 188, and has been re-stated and applied in a score or more cases since then, down to Humble v. Curtis, 160 Ill. 193, where it was said (p. 202): ‘That he (the .assignee) would take the mortgage subject to the equitable defenses existing in favor of the mortgagor. is settled in Olds v. Cummings, supra, and numerous other cases. The reason there given is, that it is the duty of the purchaser of a mortgage, it not being assignable so as to vest the legal interest, to inquire of the mortgagor if there be any reason why it should not be paid.’ Thus, in Thompson v. Shoemaker, 68 Ill. 256, it was held that upon a bill filed by the assignee of a promissory note secured by mortgage, to foreclose the mortgage, he will occupy the same position that the mortgagee would, and that the mortgagor may interpose any defense that would defeat a recovery by the mortgagee. And in Sumner v. Waugh, 56 Ill. 531, that ‘when a person buys that which is not assignable at law, relying upon a court of equity to protect and enforce his rights, he takes it subject to all the infirmities to which it would have been liable in the hands of the assignor.’ And in Haskell v. Brown, 65 Ill. 29, it was said that in such case a court of equity will let in any defense which would have been good against the mortgage in the hands of the mortgagee himself. (See, also, Towner v. McClelland, 110 Ill. 542, and Shippen v. Whittier, 117 id. 282.) In the latter case the security was in the form of a deed of trust, and it was said that the fact that the maker’s notes were payable to himself and were endorsed only by him was unimportant. ’ ’

In Kennell v. Herbert, 342 Ill. 464, a situation is presented similar to the one presented here. In that case, a bill had been filed by the circuit court of Kane county to foreclose a mortgage trust deed. The circuit court dismissed the bill for want of equity. The cause was reviewed by the Appellate Court of the 2nd District on writ of error (Kennell v. Herbert, 253 Ill. App. 252) and the decree of the circuit court affirmed largely upon the authority of McAuliffe v. Reuter, supra. In its opinion, the Appellate Court gave a statement of the facts, which is substantially as follows: “The record shows that on October 18, 1919, Alva E. Herbert and wife applied for a loan from Charles Rippberger Company, in the sum of $1,700, and executed the notes described in the bill and trust deed, securing the same, which was recorded in the recorder’s office of Kane county, October 24, 1919; that the Charles Rippberger Company was a copartnership consisting of Sam T. Peterson, the trustee named in said trust deed, Walter C. Rippberger and Sophia Rippberger; that they had been engaged for a number of years prior to the transaction in question in loaning money; that Alva E. Herbert and wife indorsed the notes in question in blank, and after receiving the sum of $1,700 left the notes at the Rippberger office in the custody of Peterson, the trustee; that some time thereafter plaintiff- in error purchased the notes from the trustee, and the name of the complainant was placed upon each of the notes as indorsee thereof, by either the plaintiff, in error himself, or someone at the Rippberger office; that thereafter Alva E. Herbert and wife executed "an agreement to sell the premises free and clear of incumbrances to William Kruse and Mary Kruse; that Herbert was notified that before the transaction could be completed he would be required to obtain a release deed from the trustee, releasing the trust deed in question, to the end that Herbert and wife would convey the property to Kruse free and clear of incumbrances in compliance with the terms of the written contract; that Herbert communicated with Peterson, the trustee, and Peterson advised that before he could execute the release-deed he would either have to pay the principal of $1,700 and interest thereon, or execute other papers secured by other property of Herbert; that thereafter Herbert executed his four promissory notes aggregating $2,000, secured by a trust deed to Peterson, as trustee, on certain other property of his; that said $2,000 in notes were given to pay off the $1,700 in notes and interest, and the balance of his book account at the Rippberger Company office; that after the execution -of said $2,000 in notes Peterson, as trustee, executed a release, dated April 19, 1921, duly acknowledged by him in the usual form, releasing the trust deed first hereinabove mentioned, and delivered the same to Herbert; that a day or two thereafter Herbert delivered the release deed, together with warranty deed, executed by himself and wife to the premises, free and clear of all incumbrance, to William Kruse and Mary Kruse; that thereupon William and Mary Kruse paid to Herbert the balance of the purchase price in full, being $3,500, less the said $500 that was paid at the time of entering into the contract, and less certain deductions; that the plaintiff in error authorized his son, T. H. Kennell, Jr., to transact any and all business with reference to the $1,700 in notes; that the plaintiff in error and his son, T. H. Kennell, Jr., were acquainted with Herbert and his wife, and saw them from time to time while the plaintiff in error held the $1,700 in notes; that the interest upon the notes was paid to plaintiff in error by the trustee, by a Eippberger check; that neither plaintiff in error nor his son ever advised Herbert or his wife that he had possession of or claimed to own the notes in question; that neither Herbert nor his wife knew that the plaintiff in error had or claimed to have any interest in the notes, Herbert believing that the notes were held by Peterson, the trustee, at the Eippberger office, until December, 1925, after the trustee and his copartners filed a petition in bankruptcy, when Kennell, for the first time, called upon Herbert and demanded payment of the notes in question; that the Eippberger Company filed a petition in bankruptcy in December, 1925; that a day or two after the filing of the petition, Kennell, Jr., acting for his father, called upon Herbert at his home, and advised him that he held the notes and wanted to know what was to be done with reference to the same; that Herbert advised him that he had paid the notes long since, and inquired of Kennell why he had never spoken to him about the matter before. The next day Kennell called upon Herbert personally, and Herbert again explained that he had paid the notes in full in 1921; that Kennell, Jr., on two or three occasions, called at the Rippberger office and consulted Peterson, the trustee, and Walter Rippberger, prior to the bankruptcy proceedings, demanding payment of the principal and interest; that the notes were past due, and finally Kennell told Rippberger that if they were not paid promptly, he would start legál proceedings to collect the same. It is insisted by plaintiff in error that because the release deed, executed by Peterson, the trustee, was in fact executed and delivered to Herbert before the maturity of the notes in question, that William and Mary Kruse, who were the purchasers of the property from Herbert, were in duty bound to obtain the canceled notes, so executed to Herbert and wife, or at least to make inquiry if the notes had, in fact, been paid. In commenting upon the evidence, the Appellate Court said: ‘ There is nothing in this record to show that the assignee of the notes, secured by the trust deed, ever filed anything of record, showing that he was the holder of the notes secured by the trust deed, sought to be foreclosed in this proceeding. ’ ” This cause was reviewed by the Supreme Court on certiorari. The Supreme Court reversed and remanded the judgment of the Appellate Court and the decree of the circuit court, with the direction to the circuit court to enter a decree of foreclosure as prayed, and the Supreme Court in its opinion (342 Ill. 464) said:

“In a suit to foreclose a lien against land the rights of the parties are governed by the law as administered in courts of equity and not by the law which obtains in actions to recover judgments upon the notes secured. (Bartholf v. Bensley, 234 Ill. 336.) A trustee is one to whom the property of another is legally committed in trust. The word ‘trustee,’ when appended to the name of a payee, is sufficient to charge persons dealing with the trustee with notice of restrictions and limitations on the trustee’s power over the instrument. The term is a warning and a declaration to everyone who reads it that the person so named is not the owner of the property to which it relates, that he holds it for the use and benefit of another, and that he has no right to deal with it except in accordance with the terms of the trust. (Owens v. Nagel, 334 Ill. 96; Henshaw v. State Bank, 239 id. 515; Chicago Title and Trust Co. v. Brugger, 196 id. 96.) Where a trust deed is owned and possessed by a third party who also owns and holds the note for which the trust deed is security the trustee has no implied authority to receive payment of the note, and if payment is made to the trustee without authority, and he releases a portion or all of the property from the lien of the trust deed prior to the maturity of the notes, the release has no effect upon ■ the rights of the owner and holder of the trust deed and note to foreclose the same. (King v. Harpster, 306 Ill. 202.) The oivner and holder of notes secured by a trust deed is not bound by unauthorized payments-to the trustee before maturity, and the payor is not justified in relying upon- representations made by the trustee when the trustee has neither the ■ actual nor implied authority to receive such payments and where the notes are not surrendered but remain in the hands of the owner and holder, who had no knowledge of the payments. If one pays to the trustee named in a trust deed the debt secured thereby before maturity which the trustee is not authorized to receive, and the trustee releases the trust deed but does not have possession of the notes, which are owned by and in the possession of a third party, the person so paying is chargeable with notice of the trustee’s want of power to receive payment. The inference of authority to receive payment arises from the possession of the trust deed and notes by the person to whom the payment is made, the inference of authority is founded upon such possession, and it does not exist without such possession. (Fortune v. Stockton, 182 Ill. 454; Stiger v. Bent, 111 id. 328; Cooley v. Willard, 34 id. 68; 1 Am. & Eng. Ency. of Law. 1026.) In equity, a release by the trustee, unauthorized by the terms of the trust deed or by the cestui que trust, will have no effect upon the trust deed as between the original parties or subsequent purchasers with notice. (Connor v. Wahl, 330 Ill. 136; Vogel v. Troy, 232 id. 481; Havighorst v. Bowen, 214 id. 90; Lennartz v. Quilty, 191 id. 174; Ogle v. Turpin, 102 id. 148.) Where the release is executed by the trustee after the indebtedness is past due, in the absence of evidence of notice to- subsequent purchasers such subsequent purchasers will be protected. Mann v. Jummel, 183 Ill. 523.” (Italics ours.) It may be noted that the Supreme Court in the Kennell case made no reference to McAuliffe v. Reuter, supra.

In the instant case, these defendants cannot blame the act of the trustee upon complainant. It was their duty to have known to whom they were maldng payments, and to have demanded the notes as well as a release deed when the payments were made.

We find nothing in the record here which indicates that Ricker was the agent of complainant, the legal owner of the trust deed and notes, and as such was authorized to receive on her behalf the payments made by defendants, or that the indebtedness to complainant was paid and discharged, as alleged in the plea, and we are of the opinion that the court was in error in sustaining exceptions to the master’s report and in dismissing the bill. The decree of the superior court is, therefore, reversed and the cause- remanded with the direction that the court enter a decree conforming to this opinion.

Reversed and remanded with directions.

Wilson and Hebel, JJ., concur.


text:
    The People of the State of Illinois ex rel. Oscar Nelson, Auditor of Public Accounts of the State of Illinois, Complainant, v. The Wiersema State Bank, Defendant. Petition of Adolph S. Helquist, Receiver, Appellee, v. Fernwood Park District, Appellant.
    Gen. No. 36,799.
    Opinion filed June 20, 1934.
    Herbert Bebb, for appellant.
    McFarland, Morgan, Partridge & McFarland, for appellee; Leonard W. Stearns, of counsel.
   Mr. Presiding Justice Hall

delivered the opinion of the court.

By this appeal the Fernwood Park District, a municipal corporation, seeks the reversal of a decree of the superior court of Cook county in and by which the court held an agreement entered into between the Wiersema State Bank and the Fernwood Park District to be ultra vires and void, and by which the court also held an escrow agreement entered into between the Wiersema State Bank and the Chicago Title and Trust Company to be ultra vires and void. By the terms of the escrow agreement, it was provided that the bank would deposit certain securities with the Chicago Title and Trust Company under certain terms and conditions, the purpose being to secure the Fernwood Park District from possibility of loss on account of deposits of its park funds in the bank. The case was heard on a petition filed'by the receiver of the bank, and it was ordered by the court that these securities, deposited under the escrow agreement, be turned over to the receiver.

On August 27, 1931, the Wiersema State Bank, through its president and cashier, entered into an agreement with the Fernwood Park District, through its president and secretary, in which it is recited in substance that the park district has money on deposit in the bank and intends thereafter to use the bank as a depositary for its funds, and that the bank desires to secure the park district in an amount equal to the maximum deposit approved by the board of commissioners of the park district; that the bank in furtherance of such purpose had deposited with the Chicago Title and Trust Company of Chicago its certain securities mentioned in an escrow agreement with the Chicago Title and Trust Company, all in consideration of the sum of $1 paid by each party to the other on the following terms: “That if at any time the securities on deposit with the said Chicago Title and Trust Company, under said escrow agreement (whether they be the same securities mentioned in the said agreement or securities hereafter deposited in substitution thereof) and the proceeds and avails thereof, shall, in compliance with the terms and conditions of said escrow agreement, be released to the Park District, then, in such event, the Park District shall have and is hereby granted authority immediately to apply any proceeds or avails received by it against the liability of money on deposit to the credit of the Park District. Further, in such event, it shall have and it is hereby granted authority to sell the securities released to it from said escrow or any part thereof at public or private sale or sales, notice of any sale in pursuance thereof shall be given to the bank or its receiver at least three days before the sale is had.”

The portion of the escrow agreement entered into between the bank and the Chicago Title and Trust Company, pertinent to this inquiry, is as follows:

“August 27,1931.

“Chicago Title and Trust Company:

“The Wiersema State Bank hereby deposits with you the following: ‘(Then follows a description of certain trust deeds and notes deposited with the Chicago Title and Trust Company under the agreement.)

“ ‘You are hereby authorized and directed to retain all of the aforesaid deposits or the proceeds thereof (with the exception of the proceeds of any interest coupons) until there has been submitted to you a certified copy of an order in any court of record appointing a receiver for the Wiersema State Bank or any successor thereto:

“ ‘Upon deposit of such certified copy, then all deposits herein or the proceeds thereof are to be delivered immediately to the order of Fernwood Park District of Chicago, Illinois.

“ ‘Permission is hereby given and the Chicago Title and Trust Company is hereby authorized and directed to deliver any interest coupons attached to any of the Principal Notes deposited herewith to the order of the Wiersema State Bank or its successor at any time within ten days before maturity thereof or at any time after maturity.

“ ‘The Wiersema State Bank pays escrow fee.’

“The Wiersema State Bank,

By Claude J. Dalenberg, its Attorney,

The Fernwood Park District,

By John L. Ohmans, President.”

Appellant advances the theory that “Illinois banks have the power to pledge assets as security for deposits of public funds.” Cahill’s Rev. St. 1933, ch. 16a, If 1, provides that “It shall be lawful to form banks . . . for the purpose of discount and deposit, buying and selling exchange and doing a general banking business.” It is insisted that under the Illinois statute, unless banks are restricted by the following qualifications, then under the power to do a general banking business, the right to pledge their assets, as suggested is necessarily implied:

“(1) Illinois banks may not issue bills to circulate as money.

“ (2) Real estate, other than the banking house can be acquired only in collection of debts.

“(3) Such outside real estate may not be carried for more than five years.

“(4) Business must not be done at more than one banking house.

“ (5) Liability for money borrowed from one person shall not exceed 15% of the surplus.

“(6) Total liabilities shall not exceed 25% of deposits.

“ (7) Loans to officers are subject to approval.

“(8) Banks are hot permitted to do business with impaired capital.

“ (9) Capital shall not be withdrawn.

“(10) Deposits shall not be received during insolvency (Criminal Code, Smith Hurd Rev. St. ch. 38, if 61).”- In other words, appellant’s position is that unless banks are expressly prohibited from guaranteeing deposits by pledging their assets, the power to do so is implied. The case of Ward v. Johnson, 95 Ill. 215, is cited as authority for this contention.

In a recent, decision of the Supreme Court of the United States, in City of Marion v. Sneeden, 54 Sup. Ct. 421, the City of Marion, Illinois, had deposited its funds with the City National Bank of Herrin, Illinois, and had appointed the Continental Illinois National Bank of Chicago its escrow agent for the deposit of bonds under an arrangement very similar to that involved in the instant case. The City National Bank of Herrin became insolvent and a receiver was appointed. Sneeden, the receiver, filed a petition in the federal court for the Eastern District of Illinois, in which it was prayed that the pledge be declared ultra vires and void, and that the securities deposited be ordered returned to him. It was conceded that under the National Banking Act this national bank was not given power to make any such contract, unless, as provided by the Federal Act, such right be given State banks by the law of Illinois, and it was contended that the pledge was valid, because in Illinois State banks have the power under the Illinois Banking Act to pledge assets as security for the deposits of public moneys belonging to municipal corporations, so that this question was directly involved. The district court upheld the legality of the pledge. The United States Court of Appeals reversed the district court. (64 F. [2d] 721.) The cause was reviewed by the Supreme Court on certiorari, which court in an opinion by Mr. Justice Brandéis, in affirming the Court of Appeals, said:

“The petitioners contend that . . . the pledge here challenged is valid, because in Illinois state banks have the power to pledge assets as security for deposits of public moneys of any political subdivision of the State. ... We think these contentions are unsound. . . . "Banks organized under the laws of Illinois do not appear to possess the power of pledging assets to secure the deposit of public moneys of a political subdivision of the State. Illinois corporations have only such powers as are conferred by statute either expressly or by implication; and .only those powers are conferred by implication which are reasonably necessary to carry out the powers expressly granted, People v. Chicago Gas Trust Co., 130 Ill. 268; Calumet, etc., Dock Co. v. Conkling, 273 Ill. 318. No Illinois statute confers in express terms upon banks organized under its laws either the general power to pledge assets to secure a deposit; or the general power to pledge assets to secure public deposits. A statute confers in terms the power to pledge assets to secure deposits of the States but there is none which so confers the power to pledge assets to secure public deposits of a political subdivision of the State. No reported decision rendered by any Illinois court since the enactment of the General Banking Law of 1887 holds that the alleged power exists as one incidental to the business of deposit banking. Nor is there any evidence that in Illinois such power is necessary in the conduct of the business of deposit banking.

“Ward v. Johnson, 95 Ill. 215, 217, decided in 1880, is relied upon as authority for the proposition that Illinois banks have power to pledge assets to secure deposits. That case arose under the charter of ‘The Merchants, Farmers .and Mechanics’ Savings Bank,’ which was granted long before the General Banking Act of 1887. The pledge involved therein was given to secure a transaction which appears to have been a loan as distinguished from a deposit. The transaction dealt with private funds. The statement was there made that banks have authority to pledge assets to secure deposits. If that statement expresses the law of the State, Illinois banks have had for more than half a century power to pledge their assets to secure private deposits as well as deposits of public moneys of its political subdivisions. But the case has never been referred to since on this point in any reported, opinion of any Illinois court. During that period, many state banks have failed; and there must have been much litigation arising therefrom; but no exertion of the alleged power on the part of any state bank has been shown.

“An authoritative determination of the question whether Illinois banks have power to pledge assets to secure the deposit of public moneys of a political subdivision of the State can be given only by its highest court.”

Cahill’s Illinois Revised Statutes 1933, ch. 16a, If 7, provides that banks organized under the act shall make periodical reports to the auditor, “which report shall exhibit in detail and under appropriate heads the resources and liabilities of such bank.” As a matter of course, in these reports deposits in the bank are listed as liabilities. Would a bank in making its report, of necessity, list its assets pledged as security for its deposits so as to indicate the exact situation? It might well be that a large proportion of any bank’s assets were so pledged and that in case of the bank’s failure, the major portion thereof would be used to pay its favored depositors at the expense of the general unsecured depositors.

It is our conclusion that by the opinion of the court in City of Marion v. Sneeden, supra, the case of Ward v. Johnson, supra, is clearly distinguished, and we hold that the contract between the Wiersema State Bank and the Fernwood Park District and the escrow agreement with the Chicago Title and Trust Company are ultra vires and void. Therefore, the decree of the superior court of Cook county is affirmed.

Affirmed.

Wilson and Hebel, JJ., concur.


author: Mr. Justice Hebel

text:
    The People of the State of Illinois, Defendant in Error, v. Abe Allen, Plaintiff in Error.
    Gen. No. 36,924.

      Opinion filed June 20, 1934.
    Rehearing denied July 9, 1934.
    William Scott Stewart, for plaintiff in error.
    Thomas J. Courtney, State’s Attorney, for defendant in error; Edward E. Wilson and Grenville Beardsley, Assistant State’s Attorneys, of counsel.
   Mr. Justice Hebel

delivered the opinion' of the court.

This writ of error was prosecuted in the Supreme Court to review the record of the defendant’s (plaintiff in error) conviction in the criminal court of Cook county for violating the Motor Fuel Tax Law (1929), Cahill’s St. ch. 95a, If 79 et seq. The indictment returned contains 17 counts, the last of which was nolled on the trial. The jury returned a verdict of guilty on the other 16 counts, and the court sentenced the defendant on each of the first six counts to pay a fine of $500 and to he imprisoned for six months in the House of Correction of the City of Chicago, the sentences to run consecutively, and on each of the remaining counts to six months’ imprisonment in the House of Correction, all to run concurrently with the sentence on the first six counts. The offenses of which the defendant was convicted were misdemeanors.

The 16 counts on which the defendant was found guilty are substantially alike, and each charges that the defendant, Abe Allen, on the first day of a specified month, and continuously thereafter during said month, in the county of Cook and State of Illinois, transported into the State of Illinois, and into the county of Cook, and received in the county of Cook, a large amount of motor fuel transported by him from without the State for sale and use in the State, the quantity of motor fuel so transported and received during the month being more than 20 gallons, but the exact amount thereof being to said grand jurors unknown, and then and there sold within the county of Cook a large amount, to wit, the amount so received, and then and there collected from the purchasers of said motor fuel a tax of three cents per gallon on all motor fuel so sold by him as aforesaid, and wilfully failed and refused to make payment to the Department of Finance of the State, or to the State, of the amount of taxes so collected on said sales. The first count is for the month of March, 1930, and each succeeding count lays the charge one month later than the count preceding it. The writ of error was sued out in the Supreme Court on the ground of constitutional questions being involved, and that court held in the case of People v. Allen, 352 Ill. 262, that no fairly debatable constitutional question appears to be involved in the judgment of the criminal court, and a writ of error does not lie from this court to review the record, and the cause was thereupon transferred to this court.

The defendant in this case has stated in his brief that there is very little conflict in the evidence, that in fact there is none which concerns the errors complained of by the defendant. The facts, as they appear from the statement in the defendant’s brief, are that Abe Allen was, during the time covered by the various counts, in the gasoline business under the name of Midway Refining Company. He maintained two places, referred to as bulk plants, used for storage, with a total capacity of 74,000 gallons. The defendant also operated or had an interest in the operation of some filling stations. Employees from two of Ms dealers, that is, Standard Oil Company and PMllips Petroleum Company, testified to sales of gasoline made to Allen. A number of operators and employees of filling stations, bus lines and cartage companies testified to purchases of gasoline from Allen. It was shown by these purchasers that each paid to Allen, in addition to the price of the gasoline, three cents per gallon for the tax. Allen did not have a license as a distributor, nor did he make any monthly returns or payments to the Department of Finance of the State of Illinois. That tank car sales made by the Standard Oil Company to Allen covered a period extending from March 4, 1930 to March 11,1931, and amounted to about 90 tank carloads, totaling over 800,000 gallons.

The method of handling the gasoline, upon which there is no dispute, was as follows: Allen would order a carload of gasoline from the Standard Oil Company through its office on Michigan avenue in Chicago. Upon receipt of the order, that company would cause the carload to be shipped from WMting, Indiana, to South Holland, Illinois, over the Baltimore and OMo and CMeago Terminal Railroad Company. A urnform bill of lading was used in each case- designating the Standard Oil Company as consignor and also as consignee. The Standard Oil Company paid the freight and charges, which it collected as part of the sale price. This company at the time mentioned was a licensed distributor under the law, but did not ask for, nor did Allen pay, any tax upon the gasoline so shipped.

When Allen received notice from the Standard Oil Company that it was ready to make delivery to him, he went to its Chicago office on Michigan avenue and paid for the gasoline, whereupon one of the employees of the company indorsed the bill of lading and delivered the same to Allen.

After payment and obtaining the bill of lading so indorsed in each instance, the defendant Allen arranged with the Chicago and Eastern Illinois Railroad Company to haul the gasoline the short remaining distance from a yard near South Holland to his bulk plant in that neighborhood, and the gasoline was disposed of as hereinabove stated, and upon a trial before the court, with a jury, a verdict of guilty was returned by the jury and sentence was entered as herein stated.

The indictment is questioned as to its sufficiency, and the defendant stresses the point that the indictment does not state facts with such certainty as the nature of the offense will admit, that the indictment in the first count and the several other counts is alike, except that the crime is alleged to have been committed on the dates set up in each count, and alleges in the first count March 1, 1930, and continuously thereafter during said month, in the county of Cook, the defendant transported into the State of Illinois and received in said State a large quantity of motor fuel transported to him from without the State for the purpose of sale and use in this State, the quantity being more than 20 gallons, the exact amount being unknown; that he sold the gasoline so received, and collected from the purchasers a tax on all gasoline sold by him, and then wilfully failed and refused to make payment to the Department of Finance of said State or to said State, of the amount of taxes so collected, or any part thereof, and that the facts alleged in the several counts of the indictment do not constitute an offense under the laws of this State, or is there sufficient charge from which it appears that the provision of the Motor Fuel Tax Law of this State was violated.

Section 1 of the Motor Fuel Tax Law, Cahill’s St. ch. 95a, If 79, defines a distributor in these words:

“ ‘Distributor’ means a person who, for sale or use in this State, either produces, refines, compounds or manufactures motor fuel in this State, or transports motor fuel into this State or receives motor fuel transported to him from without the State. It does not, however, include a person who receives or transports into this State and sells or uses motor fuel under such circumstances as precludes the collection of the tax herein imposed, by reason of the provisions of the constitution and statutes of the United States. However, a person operating a motor vehicle into the State, may transport, in the ordinary fuel tank attached to the motor vehicle, not more than twenty gallons of motor fuel, for the operation of the motor vehicle, without being considered a distributor.”

The duties of a distributor are set forth in section 6 in these words:

The charge in the indictment is to the effect that the defendant, after bringing gasoline into the State as a distributor, sold it, charged a tax for it and did not pay the tax to the State of Hlinois. This charge is clear and is expressed substantially in the language of the statute. The defendant pointed out that an integral part of the statute defining a distributor requires a negative averment, and contends that since there is no negative averment in the indictment the indictment is faulty. He plainly refers to that part of section 1 which is in these words: “It does not, however, include a person who receives or transports into this State and sells or uses motor fuel under such circumstances as precludes the collection of the tax herein imposed, by reason of the provisions of the constitution and statutes of the United States. However, a person operating a motor vehicle into the State, may transport, in the ordinary fuel tank attached to the motor vehicle, not more than twenty gallons of motor fuel, for the operation of the motor vehicle, without being considered a-distributor.” In this connection it is necessary to have in mind the rule of pleading upon this question. The Supreme Court in the recent case of People v. Saltis, 328 Ill. 494, said: “This objection to the information is based on the proposition that the subsequent provision of the section, that the prohibition shall not apply to certain persons, is a part of the description of the offense, and People v. Barnes, 314 Ill. 140, and People v. Martin, id. 110, are cited to sustain this proposition. These cases merely announce the established rule that where an act is made criminal, with exceptions embraced in the enacting clause creating the offense so as to be descriptive of it, the People must allege and prove that the defendant is not within the exception so as to show that the precise crime has been committed. Where the exception is descriptive of the offense it must be negatived in order to charge the defendant with the offense. The other branch of the rule is equally well established, that if the exception or proviso is in a subsequent section, or in the same one but not incorporated within the enacting clause by any words of reference, it need not be negatived but is a mere matter of defense. (People v. Callicott, 322 Ill. 390; People v. Talbot, id. 416; People v. Butler, 268 id. 635; Sokel v. People, 212 id. 238.) ”

The indictment under consideration is clearly within the rule- announced by the Supreme Court in that the exception not being incorporated in the enacting clause by any words of reference, there need not be a negative averment, but the exception would be a matter of defense', nor is the exception or proviso defining the offense so incorporated in the language of the definition that the offense cannot be described without reference to the exception, and moreover wherever the act withdraws certain persons or acts from the operation of the statutory provision, it is not necessary to allege that certain acts are withdrawn from the operation of the statute.

In the consideration of the points made regarding the sufficiency of this indictment containing the several counts, we are of the opinion from the facts alleged that the defendant had sufficient notice of the crime' charged. ■

The Supreme Court in the consideration of this case, in its opinion in People v. Allen, supra, construed the indictment and the expression of the court in several respects as material in disposing of the contention of the defendant in regard to the sufficiency of the indictment in question. The court in its opinion said: “The plaintiff in error argues that the common law procedure of grouping several misdemeanor counts in one indictment is unconstitutional when used for the purpose of verdict and judgment where willfulness is the gist of the action complained of and where the alleged offense is a series of similar transactions with one common intent running through all the counts. In People v. Elliott, 272 Ill. 592, an ..indictment was returned in the circuit court of Macon county against the plaintiffs in error, for selling intoxicating liquor in anti-saloon territory. There were seventy-one counts in the indictment, and upon .a trial the plaintiffs in error were found guilty on each of the seventy-one counts. Judgment was entered by the court on the verdict, sentencing each of the plaintiffs in error to pay a fine and to imprisonment in the county jail under each count. The court held that the State may join misdemeanors of the same- character in the same indictment and the court may fix separate punishments upon each count on which there was a conviction. This practice had been approved by this court before the decision in People v. Elliott and has been followed since.”

One of. the questions called to the attention of this court by the defendant is that the venue was not properly established in the county of Cook and State of Illinois, and the defendant admits that the Supreme Court, in-the case of People v. Allen, supra, held: “The allegation is that the motor fuel was sold, the tax-was collected and the failure and refusal to pay occurred within the county of Cook. The offense was therefore alleged to have been committed in the county of Cook and that was the county in which the constitution guaranteed to the defendant a trial by jury. No constitutional question was raised by the motion to quash or the trial of the plaintiff in error in Cook county.” The defendant suggests, however, the record does not disclose that the evidence introduced was sufficient to prove that the crime was committed in the county of Cook, and that being so the failure of evidence to establish this venue was not passed upon by the Supreme Court upon a prior hearing.

The evidence is undisputed that the defendant brought 800,000 gallons of gasoline from without the State into this State and sold, as a distributor, the gasoline in Cook county, Illinois, and collected the tax, which tax so collected by the defendant was not paid. to the State of Illinois and the defendant contends as a reason that the evidence does not disclose there was a branch office, for the collection of this tax in Cook county, and therefore for lack of such proof the crime was not committed in the county of Cook. It would be a defense to show that the tax collected was paid to the proper collection official of the State of Illinois, whether at the seat of government or at a branch office. The fact remains that the defendant still has the money collected as a tax on gasoline sold by him, which he admits he did not report to the proper office in the manner provided for by the statute. From these facts as they appear in the record and upon consideration of what the Supreme Court said upon this very question, which is hereinbefore quoted, this court is of the opinion that there is evidence sufficient to establish the venue in Cook county.

Instruction No. 14, given upon request of the People, is questioned by the defendant, and is as follows:

“The court instructs the-jury that each distributor who sells any motor fuel for any purpose shall collect from the purchaser at the time of said sale three cents per gallon on all motor fuel sold and at the time of making the monthly return the distributor shall pay to the Department of Finance the amount so collected.

“Every person acting as a distributor of motor fuel shall, between the 1st and 20th day of each calendar month, make return, under oath, to the Department of Finance, showing the amount of motor fuel purchased, produced, refined, compounded, manufactured, received, sold, distributed and/or used by him during the preceding calendar month.

“Motor fuel means all volatile and inflammable liquids produced or compounded for the purpose of and which are suitable and practicable for operating motor vehicles.

“Distributor means a person who for sale or use .in this State transports motor fuel into this State or receives motor fuel transported to him from without the State.

“Whoever wilfully fails or refuses to make payment to the Department of Finance, as above provided, is guilty of a misdemeanor.”

The defendant contends that this given instruction, being, in part, in the words of the statute, was erroneous for the reason that there is no evidence to warrant the giving of such an instruction. It is to be noted that the instruction is but directory and was given to inform the jury as to the nature of the charge, and does not attempt to instruct the jury as to the nature of their verdict, and is not so erroneous as to justify a reversal.

The question is raised by the defendant that the Act of 1929 was repealed by the Act of 1931. We have but to refer to the statutory provision relating to the construction of statutes in par. 4, ch. 131, Cahill’s Ill. Rev. St., which eliminates this question in these words:

“No new laws shall be construed to repeal a former law, whether such former law is expressly repealed or not, as to any offense committed against the former law, or as to any act done, any penalty, forfeiture or punishment incurred, or any right accrued, or claim arising under the former law, or in any way whatever to affect any such offense or act so committed or done, or any penalty, forfeiture or punishment so incurred, or any right accrued, or claim arising before the new law takes effect, save only that the proceedings thereafter shall conform, so far as practicable, to the laws in force at the time of such proceeding. If any penalty, forfeiture or punishment be mitigated by any provisions of a new law, such provision may, by the consent of the party affected, be applied to any judgment pronounced after the new law takes effect. This section shall extend to all repeals, either by express words or by implication, whether the repeal is in the Act making any new provision upon the same subject or in any other Act.”

It is also contended the evidence should have been admitted that the defendant’s lawyer advised him upon the question whether the defendant would be liable to the State for the gasoline purchased and sold by the defendant as a circumstance in determining whether the law was wilfully violated. This evidence was incompetent, and the trial court was right in sustaining the State’s objection to the admissibility of this proof. The evidence is clearly hearsay, and while advice of counsel to the defendant was important, still the advice given to the defendant if admitted would result in an immaterial issue upon the question of whether or not the advice was good law.

Upon the question of intent, which is one of the questions before this court, the legislature may provide that in doing a criminal act it does not necessarily follow that there must be an intent of the doer to violate the law, especially where, as in this case, the statute on the question of intent is silent as to motive. It is sufficient that the law was violated and the fact that the violator acted in good faith, or without knowledge, is no defense when a defendant is charged, as in this case, with violation of a provision of the criminal law. McCutcheon v. People, 69 Ill. 601.

. The remarks of the trial court have been called to the attention of this court as being prejudicial. We have examined the questioned language, and the words used were not so prejudicial as to influence the jury.

We have examined the various points called to our attention, and it does not appear to this court that there is reversible error in the record, and for the reasons stated in the opinion the judgment is affirmed.

Judgment affirmed.

Hall, P. J., and Wilson, J., concur.


text:
    Mabelle A. Golinkin, Appellee, v. First Union Trust and Savings Bank, Appellant.
    Gen. No. 36,984.
    Opinion filed June 20, 1934.
    . Amberg, Ott, Dahlin & Livingston, for appellant; Prank L. Paul and Robert P. Pebkaus, of counsel.
    William Levine, for appellee.
   Mr. Justice Hebel

delivered the opinion of the court.

This is an appeal by the defendant from a judgment entered in the municipal court of Chicago for the sum of $750 in favor of the plaintiff upon a hearing before the court without a jury.

The action was by the plaintiff against the defendant for moneys had and received, and is based upon the allegation that the plaintiff was the payee of two certain checks drawn by the Utility Securities Company to her order, one dated January 17, 1928, for the sum of $500, and the other dated July 31, 1928, for the sum of $250. These checks were drawm on the First Trust and Savings Bank, and it is alleged that the defendant paid both of said checks upon an unauthorized and forged indorsement-of plaintiff’s name and that the proceeds of the checks were never received by the plaintiff. To this claim the defendant filed an affidavit of merits.

The defendant contends that the plaintiff by the filing of a prior suit against the drawer of the checks in question selected her remedy and is bound by such election. This may be true, provided the plaintiff had knowledge of the material facts when the suit was instituted, and the prior suit was inconsistent with the remedy sought by thé plaintiff in the present case.

The prior suit by the plaintiff was for recovery by her upon an action for moneys had and received, and upon the plaintiff’s theory her position in - that case was that the defendant still had her money, which the defendant received and which'fully appears from the two accounts with this company. To this action, however, the defendant Utility Securities Company claims that it paid the amount claimed by the plaintiff by the issuance of two checks drawn to her order. The case was tried upon the issues joined and from the evidence, the court in the trial óf thát'base entered a judgment against thé plaintiff. • • ■ • . •

It is the contention of the defendant that the plaintiff in the present suit affirmed the payment of the money by the Utility Securities Company in the prior suit, and ratified the payment of her account with the Utility Company by checks which were drawn- to her order. Having ratified the accounts with the Utility Company, she now seeks- payment of the checks, which she contends were paid upon a forged indorsement.

The doctrine of the election ■ of a remedy and the choice by a litigant of one of two inconsistent remedies may be an election not to pursue the other, and this doctrine is applied in the case of Sluka v. Bielicki, 335 Ill. 202, where the court said:

“Where two remedies for the breach of a binding contract exist, one an action at law for violation of the contract and the other for specific performance, and one of these remedies is elected by the party suing, then, under the doctrine of election of remedies, he cannot resort to the other. (Bell v. Anderson, 292 Ill. 605.) Where the doctrine of election of remedies applies the bar arises as soon as the choice is made, and becomes full and absolute against the other remedy at the time of the filing of the petition, declaration or claim. (Bradner Smith & Co. v. Williams, 178 Ill. 420.) This has been the rule in this State since Herrington v. Hubbard, 1 Scam. 569.”

This court upon the same question said in the case of Kaszab v. Metropolitan State Bank, 264 Ill. App. 358:

“ ‘Election of-Remedies’ is the choice or adoption of one of two or more existing remedies, the use of one of which would preclude a resort to the others. In order, to make a case of the application for this elective principle),the party having the right to the choice and selection must actually have at command two inconsistent remedies. The doctrine of election is based on the theory that where there are inconsistent rights or remedies, of which a party may avail himself, a choice of one is held to be an election not to pursue the other. If, however, the remedies are coexisting and consistent, the doctrine of election does not apply. Courts of law are open to litigants to furnish redress for injuries or damages sustained, but it places upon the litigant the duty of electing the course which he desires to pursue. If the actions are inconsistent, the courts place the responsibility of election on the one who seeks its aid and assistance. Glezos v. Glezos, 346 Ill. 96.” And this court in its opinion, after discussing the authorities cited, further said upon this question:

“From these cases the doctrine appears to be fairly well settled that where one sues a drawee bank on a check paid by it on a forged indorsement, he takes the position that the bank still has his money and that the money paid out by the bank was the bank’s money and, therefore, not binding as to him. Where one sues another who has indorsed such a check over to the drawee bank, he necessarily takes the position that the money paid by the drawee bank was wrongfully paid and therefore wrongfully detained. The positions are mutually contradictory.

“By electing to hold the drawee bank, one whose name has been forged to a check is placed in the position of refusing to ratify the payment by the bank on the forged instrument. No case in the Supreme Court of this Státe has been directly passed upon and the opinion in Bartlett v. First Nat. Bank of Chicago, 156 Ill. App. 415, cited by plaintiff, is not controlling. The Supreme Court of this State, however, inferentially has recognized the distinction between the liability of the drawee bank and an indorser guaranteeing prior indorsements.

“In the case of Independent Oil Men’s Ass’n v. Fort Dearborn Nat. Bank, 311 Ill. 278, the court in its opinion says:

“ ‘Defendant in error might have brought an action of trover against plaintiff in error for unlawful eon-version of its property, but it chose to waive the tort and to bring its action in assumpsit for money had and received for its use. That it had a right to do this is well established by the great weight of authority. (Rauch v. Fort Dearborn Nat. Bank, 223 Ill. 507; Hamlin’s Wizard Oil Co. v. United States Express Co., 265 id. 156; Talbot v. Bank of Rochester, 1 Hill, 295; Buckley v. Second Nat. Bank, 35 N. J. L. 400; Farmer v. People’s Bank, 100 Tenn. 187, 47 S. W. 234; Crisp v. State Bank, 32 N. D. 263, 155 N. W. 78.)’ ”

Under this doctrine it is necessary, before a party is bound by the election of one of two remedies, that he have full knowledge of all the facts. In this case the facts are substantially that the plaintiff learned upon inquiry that her account with the Utility Securities Company had been closed and that checks were issued in payment. After consultation with her attorney, she instituted suit in the municipal court of Chicago against the Utility Securities Company for the amount due her, alleging that her account was closed without her consent, and therefore the company was still indebted to her. The case was tried upon the issues, and the court found against her.

It appeared from the evidence in that case that two checks in the sum of $500 and $200 respectively, were issued by the company, and upon the. trial the. checks were impounded and held until the trial of- the instant case. The plaintiff then filed the- suit now before this court for recovery of the amount of the two checks issued by the Utility Securities Company. The checks were delivered by the Utility Company to Allen L. Grolinkin, the former husband of the plaintiff, and by him cashed. The present action ratifies the. closing of the plaintiff’s account- with the Utility Company and the delivery of the checks of the company- to Allen L. Grolinkin, and it appears from the evidence that Grolinkin opened this account with money furnished to him by his wife, and that he was permitted to handle the account for her, and if at any time he saw fit he could close the account.

This action is entirely inconsistent with the former suit, and the plaintiff, under the doctrine of election of remedies, cannot, after making her choice, resort to this form of action. The plaintiff, no doubt, could have recovered in the action in the instant case, and the defendant would have had no defense, but having selected her remedy in her former lawsuit after consulting with her attorney in that case, she is not now in a position to recover in this action. The plaintiff is in a unique position, for in the prior suit she took the position that her account with the Utility Securities Company was still open, and that the sum evidenced by this account was still due at the time she filed her first suit, and now in the present case, by her position, she ratifies the closing of her account and the payment by checks of the Utility Company for the amount she claims due. This, of course, cannot be done.

Another question has been called to our attention, and that is that the judgment order in the prior suit is res' adjudicata of the issues involved in this case. Howuver, this issue is not material, in view of the fact that by the election of her remedy the plaintiff in the prior suit waived her right of action in the present suit, and the court erred in entering judgment on the finding.

For the reasons stated in this opinion the judgment for the plaintiff will be reversed and judgment will be entered by this court for the defendant.

Judgment for plaintiff reversed and judgment here for defendant.

Hall, P. J., and Wilson, J., concur.