author: Mr. Justice Wolee

text:
    Fred H. Larocque, Plaintiff. Ina F. Taylor et al., Appellants, v. William H. Baker et al., Appellees.
    Gen. No. 9,255.
    Opinion filed January 21, 1938.
    Rehearing denied May 3, 1938.
    Gower, Gray & Gower, of Kankakee, for appellants.
    A. L. & C. M. Granger, both of Kankakee, for appellee Emily J. Baker.
   Mr. Justice Wolee

delivered the opinion of the court.

The appellants, Fred H. Larocque et al., brought suit in the circuit court of Kankakee county against the appellees to foreclose a mortgage which had been executed by William H. Baker. The note and mortgage had been executed April 8, 1927, for the sum of $3,325, due ten years after date, with interest at six per cent per annum. The defendant, William H. Baker, defaulted in his interest payments and the appellants brought suit to foreclose the note and mortgage.

The plaintiffs charge that John Baker and his wife, Emily J. Baker, executed a mortgage on the premises in question on February 10, 1909;. that John Baker died leaving a last will and testament in which he gave his widow, Emily Baker, a life estate in the premises with remainder to the four children of John and Emily Baker; also three legacies of $1,000 each payable to three of their children at the death of Emily Baker, which is a charge upon the real estate. The complainant further charges that on February 7, 1924, Emily J. Baker, the widow of John Baker, life-tenant of said premises, purchased from the holders, the note and mortgage of John Baker and had the same assigned to herself; that the principal and interest on said note, secured by said mortgage, had not been paid to the holder of the note and mortgage since February 7, 1924, and because of the failure in the payment of the interest on said mortgage indebtedness the said mortgage ceased to be a lien upon said premises or any part thereof. An accounting is asked for between William H. Baker and the plaintiff, and that the trust deed given by the defendants, William H. Baker and Margery Baker, be declared a valid first lien upon the property described therein, subject only to -the life estate of Emily J. Baker and to the payment of its pro rata one-fourth part of the three legacies of $1,000 each.

Emily J. Baker filed her answer in which she disclaimed any knowledge of allegations concerning the debt of William H. Baker. She admits that she is the widow of John Baker, deceased, and that she has a life estate in his property under his will, duly proved and admitted to record. She admits the mortgage to the Nórthwestern Mutual Life Insurance Company by John Baker and herself. She denies that that debt has been fully paid, but says that on the 7th day of February, 1924, she bought the note and mortgage in question from the Northwestern Mutual Life Insurance Company for the sum of $10,061.11, the amount then due, principal and interest on said note and mortgage, and that said note and mortgage were on that day assigned by said insurance company to her. She admits that no payments have been credited on said note and mortgage, principal or interest since February 7, 1924. She denies that by reason of the failure to make said credits, said mortgage has ceased to be a lien, but on the contrary alleges that said mortgage is in full force and effect.

The court found the issues in favor of the plaintiff so far as the mortgage of William H. Baker was concerned and decreed, a foreclosure on his one-fourth interest covered by the mortgage given by him to the appellants. Also it is decreed that this one-fourth interest was subject to the three $1,000 legacies as before mentioned, and also that the same be sold, subject to the life estate of Emily Baker, and also subject to the $10,000 mortgage held by Emily J. Baker which had been assigned to her in 1924.

The appellees, in their brief and statement of facts say, “It is not averred in the bill of ■ complaint that the $10,000.00 mortgage indebtedness was past due at the time of the assignment of the note and mortgage to Emily J. Baker. The appellants, in their reply brief, state that on page 3 of the Abstract and page 11 of the record, the complainant alleges that the debts secured by the mortgage given by John Baker to the Northwestern Mutual Life Insurance Company, was then due. The appellee has filed a motion to strike the appellants’ reply brief from the files, because it contains new matter not set forth in the original brief and argument.” The appellant has filed a counter-affidavit resisting this motion and still insists that the abstract shows that the complaint states that the note and mortgage was then due. An examination of the abstract shows that appellants are correct in stating that the abstract does show that the note was then due, but the bill of complain, as shown by the record, does not contain any such allegation. The party preparing the abstract was mistaken as to what the original bill of complaint contained. Whether the complaint did, or did not show this note and mortgage of $10,000 was due and unpaid at the time of the assignment to Emily Baker, we think it is of little consequence, so far as the merits of this controversy is concerned. Technically, the reply brief is not correct and contains matters which are not bourne out by the record, but we have concluded to consider the reply brief, and the motion to strike the same is hereby denied.

The material question for the court to decide is, whether the statute of limitations has run against the note and mortgage of $10,000, which Mrs. Emily Baker purchased from the Northwestern Mutual Life Insurance Company. It is conceded that at the time she purchased this note and mortgage that the statute of limitations had not run against it, but was a valid and existing lien upon the real estate owned by her husband. Mrs. Baker purchased this note and mortgage out of her own funds and had the same assigned to her and shortly thereafter, had the assignment recorded in the county in which the real estate is located. This occurred more than three years prior to the time that William H. Baker executed the note and mortgage on his undivided one-fourth interest in the real estate, so that the mortgagee in the William H. Baker mortgage had notice of the assignment to Mrs. Baker.

It is conceded that after the assignment of the note and mortgage to Mrs. Baker, no money has actually been paid on this note and mortgage up to the date of the foreclosure of the mortgage of Wm. Baker. It is seriously contended by the appellants that the statute of limitations has run against this mortgage and the same is now null and void, and that Mrs. Baker has lost her lien on the premises. The appellants charge in their bill, that Emily J. Baker has exclusive control of said land and receives all the income therefrom. This allegation is admitted by the appellees. The bill does not state in what capacity Mrs. Baker is in possession of the property, but she claims that she holds it in a dual capacity. “First: As life tenant under the Will of her deceased husband; Second : As mortgagee in possession under the mortgage that she purchased from the Northwestern Mutual Life Insurance Company.” It will be observed that she mortgaged her interest in the property, but did not sign the note, so she was not personally liable for the payment of the note and mortgage.

The appellees contend that in either capacity in which she holds this property the statute of limitations would not run against her. They also contend that in a court of equity, she should not be held to the strict rule of law in regard to limitations. To this theory of the appellees’ case we cannot agree, for we think that the ten-year statute, in regard to foreclosure of a mortgage, is binding upon a court of equity, unless there are some facts or circumstances that takes it out of the general rule.

In volume 2, of “Jones on Mortgages” sec. 1536 at page 1034, we find the following: “If the mortgagee be a tenant for life of the mortgaged estate, and as such receives the rents, the statute does not run against the mortgage title. The concurrence of the tenancy for life, and the right to receive the interest on the mortgage in the same individual, renders it impossible for Mm to make any acknowledgment of that title to himself; but it being his duty as such tenant, to keep down the interest, the law will presume that he does so out of the rents received by him. TMs rule being in favor of the remainder-men, they can not afterward be permitted to contend that the interest thus deemed to have been kept down for their benefit was not in fact paid, and that the right to enforce the mortgage is barred by the statute; under such circumstances, the Statute of Limitations cannot be applied against the mortgage.” Mr. Jones’ work on mortgages has long been considered authoritative in this State.

Another valuable book on mortgages is “Beeves Illinois Law on Mortgages and Foreclosure.” In volume II, sec. 642, under title “Mortgagee in Possession” is the following: “Where the mortgagee, after condition broken, and before the debt becomes barred by the statute of limitations, takes possession of the mortgaged property, the statute will not run against the mortgage debt wMle he retains such possession. In a case where a mortgagee had taken possession under these circumstances, it was said that ‘by so doing she pursued one of the recognized modes, under the law, for the collection of the mortgage debt. She occupied the same position in that regard as an original mortgagee in possession, and became liable to account for the rents and profits actually received, or which by proper diligence she might have received, to be credited upon the indebtedness from year to year. Manifestly, while she was thus proceeding to collect the debt, in a lawful manner, no statute of limitations could run against her. She had the right to remain in possession until the debt was fully satisfied.’ ” The case of Mills v. Lockwood, 42 Ill. 111, was a proceeding to enjoin a suit in ejectment. One of the allegations of the complaint was that the defendant was guilty of laches in asserting his right in the property. In passing on this question the court says: “On the point of laches, in not resorting to this remedy at an earlier period, the answer is, the statute of limitations has not run against the complainant, and he has been, all the time, since his purchase, in peaceable possession of the lands. . . . It is not understood that a statute of limitations, or rule of limitation in equity, runs against a possessor of real estate, but it runs against him who is out of possession.”

In the case of Parker v. Shannon, 137 Ill. 376, we find this language: “Laches cannot be imputed to the complainant in bringing this bill, because he was in possession of the lots before the Tiffany judgment was rendered and had been in the continuous possession thereof ever since. A statute of limitations, or rule of limitation in equity does not run against a possessor of real estate, but it runs against him who is out of possession. . . . ‘The possession is notice to all of the possessor’s equitable rights, and he needs to assert them only when he may find occasion to do so.’ ”

In the case of Newell v. Montgomery, 129 Ill. 58, the court says, “The doctrine of laches cannot be invoked as a bar to the equitable title of the Montgomerys, for the reason that they are shown to have been in possession of said lot and in receipt of the rents therefrom ever since the day of the sale.”

In the case of Bradley v. Lightcap, 195 U. S. 1, at page 17, which is a case in the Supreme Court of the United States from the Supreme Court of Illinois, the question to be decided by the court was whether or not the statute requiring the purchaser of land at a mortgage foreclosure, to obtain a deed within five years, was binding upon the purchaser when he had gone into possession of the premises. A part of the opinion is: “The general rules of laches are not immutable to a party in possession of the lots and the rights thereof.” The case of Fountain v. Bookstaver, 141 Ill. 461, at page 461 seems to be decisive as to the question before us in this case. The defendant purchased the notes and a mortgage on the property in question and immediately went into possession of the property. The court after discussing the question of the legality of the indorsement and transfer of the note and mortgage to Mrs. Bookstaver, held, that the assignee of the note and mortgage after default in the terms of the note or mortgage, had the right to go into the peaceable possession of the mortgaged premises the same as the mortgagee. The court then continues: “It is further contended that the statute of limitations had run against the mortgage indebtedness, and therefore all right of possession to the mortgaged premises in the mortgagee, or his assignee, was at an end when the suit was brought. If this was an action by the holder of the mortgage to foreclose the same, or to obtain possession of the premises under it, there would be some question as to whether there is sufficient proof of payments on the mortgage indebtedness to prevent the bar of the statute; but if we are correct in our conclusion as to the rights of the defendant already in possession under the mortgage, no question of limitation is involved in the case. From what has already been said, it will be seen that Mary E. Bookstaver entered into possession in 1883, after condition broken, and before the Statute of Limitations had run against the indebtedness. By doing so she pursued one of the recognized modes under the law for the collection of the mortgage debt. She occupied the same position in that regard as an original mortgagee in possession, and ‘became liable to account for the rents and profits actually received, or which by proper diligence she might have received, to be credited upon the- indebtedness from year to year, first in the extinguishment of the interest and then of the principal.’ (McConnel v. Holobush, 11 Ill. 69.) Manifestly, while she was thus proceeding to collect the debt in a lawful manner, no statute of limitations could run against her. She had a right to remain in possession until the debt was fully satisfied.”

It is our conclusion that the court properly decreed that the sale of the one-fourth interest of William H. Baker covered by the mortgage in question, should be sold subject to the three legacies of $1,000 each, and to the life estate of Emily Baker, and to the mortgage indebtedness of $10,000 held by Emily Baker.

The sixth assignment of error relied upon for reversal is as follows: “Having held, that the note of $10,000.00, given by John Baker, and the mortgage to secure the same held by Emily J. Baker, is not barred by the Statute of Limitations, the court erred in not requiring in its decree that the life-estate of Emily J. Baker in the property devised by John Baker should contribute pro rata towards the payment of said $1,000.00 note.” The abstract contains nothing that would indicate that the trial court was ever asked to pass upon this proposition of law, and this question is raised for the first time in the Appellate Court. Our courts have frequently held that a question presented in this court for review must first be raised to the trial court, as it cannot be raised for the first time in the Appellate Court. Inner Group Financing Corp. v. Halsted Exchange Nat. Bank, 287 Ill. App. 352.

We find no reversible error in this case and the judgment of the trial court is hereby affirmed.

Affirmed.


source: Caselaw Access Project

author: Mr. Justice Wolfe

license: Public Domain

text:
    Florence Huntoon, Appellee, v. Dr. J. E. Pritchard, Appellant.
    Gen. No. 9,230.
    Dove, P. J., dissents.
    Opinion filed March 10, 1938.
    Rehearing denied May 3, 1938.
    Alschuler, Putnam & Johnson, of Aurora, for appellant; Edward F. Streit, of Aurora, of counsel.

      Shearer & Sears, of Aurora, for appellee; Barnabas F. Sears, of counsel.
   Mr. Justice Wolfe

delivered the opinion of the court.

The plaintiff, Florence Huntoon, on March 20, 1931, started suit against the defendant, Dr. J. E. Pritchard, a practicing physician and surgeon in the city of Aurora, Illinois, for damages which she alleges she sustained through the carelessness and negligence of the defendant, while treating her as a physician. The case was before this court at a previous term, reported in 280 Ill. App. 440. At the time, the case was reversed and remanded for a new trial. The case was again tried by a jury in the city court of Aurora, Illinois, in which the plaintiff was successful and procured a verdict for the sum of $2,500. Judgment was entered on this verdict, in favor of the plaintiff. From this judgment, this appeal is prosecuted.

After the original declaration was filed, the defendant, through his attorney, on June 27, 1931, filed a general demurrer to the declaration.

On June 29, 1931 on motion of the plaintiff, the suit was dismissed. On July 29, 1931, new counsel appeared for the plaintiff and on motion the suit was reinstated. On the same day the court sustained the general demurrer to the declaration. The plaintiff was granted leave to amend her declaration and on September 23, 1931 filed an amended declaration in which she stated the date of the alleged treatments by the defendant as June 5, 1929. To this amended declaration, the defendant filed a general and special demurrer, which was overruled. The defendant then filed three pleas: The first, the general issue; the second, a plea of the statute of limitations; the third sets forth as a defense, that the injuries the plaintiff complained of were received in the course of her employment by her former employer, and that the plaintiff and employer had elected to be bound by the Workmen’s Compensation Act and that the plaintiff had claimed and received compensation from her employer for said injuries, and therefore, her action is barred as against the defendant. All pleadings were filed prior to January 1,1934, and the case proceeded under the old Practice Act.

On a former trial of this case the plaintiff filed a demurrer to this third plea. The trial court overruled the demurrer and held that the same was a valid plea. It was from this ruling of the court that the former appeal was prosecuted to this court. We held that the plea did not state a valid defense and the demurrer should have been sustained as to this plea, and we reversed and remanded the case. Following the mandate of this court, the trial court entered an order sustaining the demurrer to this plea. The defendant has assigned error of the action of the trial court in sustaining the demurrer to the plea. The statement we made in our former opinion relative to the merits of this plea, we reaffirm. The trial court properly sustained the demurrer to this plea.

The other question raised by the appeal at this time is: Whether or not the amendment to the declaration, which was made more than two years after it is alleged that the cause of action arose, is barred by the statute of limitations. It is conceded by the attorneys of both parties to the litigation, that if the original declaration does not state a good cause of action, the amendment which was made more than two years after the date when the cause of action arose, would state a new cause of action and the statute of limitations would apply. An examination of the declaration discloses that it was taken practically verbatim from “Puterbaugh’s ■ Pleading and Practice,” Tenth Edition, on page 1016. The appellant insists strenuously that the original declaration filed in this case at bar, did not state a cause of action, because no facts were stated from which the law would infer a breach of duty on the part of the defendant in his professional treatment of the plaintiff.

Whether the original declaration did, or did not state a good cause of action, the court sustained a general demurrer to it, and the plaintiff, by asking leave to amend the declaration, confessed that it did not state a good cause of action.

In the case of the People v. Core, 85 Ill. 248, the court in discussing the effect of a general demurrer being sustained to a declaration, has this to say: “It is urged that the court erred in sustaining a demurrer to the declaration. Inasmuch as appellant amended his declaration, he thereby waived all objections to the decision of the court. Had he desired to raise any question as to the correctness of the decision sustaining the demurrer, he should have abided by his declaration, and permitted judgment to be rendered against him on the demurrer. This is one of the plainest and most elementary rules of practice, and the objection is frivolous.” In the case of Bennett v. Union Cent. Life Ins. Co., 203 Ill. 439, at page 444 the court says: “It is the well established rule in this court that if a pleading is held insufficient on demurrer the pleader must abide his pleading, or as is sometimes said, must elect to ‘stand by’ his plea, if he would have the correctness of the judgment pronounced on the demurrer reviewed in a superior court, but it is not requisite he shall orally, or in writing, advise the court that he abides his pleading or elects to stand thereon. If he asks leave to amend the pleading in order to obviate the defect pointed out by the demurrer or asks leave to plead over, he. thereby abandons his original pleading and does not abide or ‘stand bv’ it.” (People v. Opie, 304 Ill. 521.)

If the plaintiff wished to test the validity of the court’s ruling in sustaining the general demurrer to her declaration, she should have stood by the declaration and appealed the case to the Appellate Court. This, she failed to do, but asked leave to amend the same and is not in a position to now urge that the original declaration stated a good cause of action. Section 39, ch. 110, Smith-Hurd’s Revised Statutes of 1929; Cahill’s Rev. St. 1929, ch. 110, ¶ 39, provides that a declaration can be amended even though the amendment was not filed until after the statutory period of two years had run after the date of the injury. No doubt, when a declaration states a good cause of action, but in a defective manner, although a special demurrer may have been sustained to it, the court should allow an amendment, to make the original declaration more specific. When the original declaration does not state a good cause of action, and a general demurrer has been sustained thereto, the statute does not apply. The distinction is that a declaration stating a good cause of action in a defective manner, may be amended, but when it does not state a good cause of action at all, it may not be amended. This is the substance of our holding in the case of Smith v. Illinois Power Co., 279 Ill. App. 505; and Day v. Talcott, 361 Ill. 437. It is our conclusion that the cause of action arose more than two years before the amended declaration was filed, and the plea of the statute of limitations is sustained by the evidence and pleadings. The judgment of the trial court is hereby reversed.

Reversed.

Dove, P. J., dissents.


author: Mr. Presiding Justice Dove

text:
    State Bank of St. Charles, Appellee, v. James H. Burr et al., Appellants.
    Gen. Nos. 9,210 and 9,218.
    Opinion filed March 31, 1938.
    Rehearing denied May 6, 1938.

      Francis M. Lowes, of Chicago, and Walter E. Healy, of Elgin, for appellants.
    D. A. Green, of St. Charles, and John K. Newhall, of Aurora, for appellee.
   Mr. Presiding Justice Dove

delivered the opinion of the court.

On February 13,1936, the State Bank of St. Charles filed in the circuit court of Kane county its complaint to foreclose two trust deeds and a quitclaim deed theretofore executed by James H. Burr and Annette Burr, his wife. The complaint alleged among other things that the first trust deed was executed by James H. Burr and Annette Burr on May 5, 1927, by which they conveyed to John W. Chaffee, as trustee, 240 acres of land in Kane county to secure the payment of $18,000 evidenced by several notes payable to the order of themselves and by them indorsed in blank and delivered to the Stewart State Bank of St. Charles, Illinois and thereafter duly assigned for a valuable consideration by the Stewart State Bank to the plaintiff, which is now the legal holder and owner thereof. The complaint further alleged that on January 30, 1929, James H. Burr and Annette Burr again became indebted to the Stewart State Bank of St. Charles in the amount of $4,500, and on that day they executed a note for said amount, payable to the order of themselves and secured the payment thereof by a trust deed to J. W. Chaffee, as trustee, on the 240 acres covered by the first trust deed and an additional tract of 46 acres. It was further alleged that said note was thereafter duly indorsed by the makers and payees and subsequently delivered to the Stewart State Bank of St. Charles, Illinois, and thereafter duly assigned for a valuable consideration by the Stewart State Bank to the plaintiff which is now the legal holder and owner thereof.

The complaint also sets out that both of the aforesaid properties were subject to two prior incumbrances, one to the First Trust Joint Stock Land Bank of Chicago on the east 100 acres of the 240 acre tract which was given to secure the payment of a note for $8,000 and one to the Federal Land Bank of St. Louis on the west 140 acres of the 240 acre tract and also upon the 46 acre tract which was given to secure the payment of a note to said Federal Land Bank of St. Louis in the amount of $17,500. The complaint also alleged that the plaintiff was compelled to make and did make payments on these prior incumbrances and that the total amount due plaintiff including unpaid principal and interest on the notes held by them, advances, taxes and insurance amounted to $32,737.67. The complaint also alleged that on September 14, 1931, James H. Burr and Annette Burr conveyed the premises described in both of said trust deeds, being 286 acres, to the plaintiff by a quitclaim deed and that at the same time the plaintiff leased all of said premises to the said James H. Burr for the period beginning September 15, 1931 and ending March 1, 1933 and executed and delivered to said Burr an option by which it bound itself to reconvey all of said property to Burr upon his paying on or before September 1, 1932 all moneys due it under and by virtue of its said'trust deeds. The complaint also alleged that in a forcible detainer proceeding brought by it to secure possession of said premises, this court held that said deed was given to the plaintiff as additional security for the indebtedness secured by said two trust deeds. The complaint prayed for an accounting and that the court enter the usual decree of foreclosure and sale.

The defendants James H. Burr and Annette Burr filed their answer in which they admitted all of the material allegations of the complaint as to the execution and delivery of the several notes, trust deeds, quitclaim deed and lease as alleged in the complaint but denied that the plaintiff was the legal owner and holder of said notes and denied that the amount due the plaintiff was correctly set out in the complaint and that the plaintiff was entitled to any of the relief sought. To this answer, plaintiff filed a reply to the effect that the notes described in the complaint were assigned to the plaintiff pursuant to the authority of the auditor of public accounts at the time plaintiff purchased the assets of the said Stewart State Bank.

The defendant, James H. Burr, filed his counterclaim in which he alleged that on October 1, 1932 and prior thereto he was the owner of and in possession of the 286 acres involved herein and that on the 10th day of October, 1932, and on divers days thereafter the plaintiff, by its officers and agents, with the evil purpose of compelling the defendant, James H. Burr, to surrender and abandon all his right, title and interest in and to his farm and to impoverish and financially ruin him, did wrongfully, illegally, and maliciously induce Burr’s tenant on said premises to disregard the instructions and directions of Burr and as a consequence of his neglect to care for certain cattle belonging to Burr on the said farm that some of the said cattle died.' That the bank also induced the tenant of the said Burr to neglect and fail to farm the land in a good and husbandlike manner and to neglect and fail to harvest the crops thereon, that the said bank also wrongfully and maliciously prevented Burr from procuring another tenant on said farm and stated to those who were negotiating with Burr to become a tenant thereon that he, Burr, no longer had any control of the said farm and that he was no longer the owner thereof. The counterclaim also alleged that the bank on the 1st day of March, 1933, wrongfully, illegally and maliciously took possession of the farm without the consent of the said Burr, and excluded Burr therefrom until March 1, 1936, and placed its tenant thereon and that during this period vines, fruit trees and shrubbery were cut down and destroyed and that the bank, by its tenant, broke into the tool shed on said premises and as a result thereof certain tools and implements belonging to the said Burr were used, appropriated and destroyed. The" counterclaim further alleged that the bank appropriated certain crops belonging to Burr and also 10 head of his cattle and that during the entire period of time, by their conduct, caused the premises and the buildings thereon to greatly depreciate in value by reason whereof it is alleged that the defendant Burr was damaged to the amount of $35,000.

The bank filed a reply to this counterclaim, in which it set out the execution of the quitclaim deed by Burr and his wife to the plaintiff of the premises involved herein and of the lease thereof to Burr by the plaintiff and the option given Burr to repurchase the same and then in its reply denied that it took possession of the premises without Burr’s consent but averred that after the option to repurchase had expired, it did take possession by virtue of its deed thereto and claimed ownership thereof by virtue of said deed and alleged that the entire herd of cattle on the farm belonged to it by virtue of a bill of sale executed by Burr. The reply denied that it, the bank, acted with any evil purpose and intent but alleges that it operated the farm under the deed of the defendant and specifically denied the several other allegations of the counterclaim.

A trial of the issues made by the counterclaim and reply thereto were submitted to a jury which found the defendant bank guilty and assessed the damages of the counterclaimant at the sum of $8,000. Motions by the counterclaimant to set aside this verdict and grant a new trial and in arrest of judgment were overruled and on October 15, 1936 judgment on the verdict was rendered and on October 22,1936 the decree herein was entered. The issues made by the complaint, answer and reply were submitted to the chancellor, resulting in a decree of foreclosure and sale. This decree found that the amount due the plaintiff by virtue of its notes secured by the two trust deeds and quitclaim deed was $39,201.38, and ordered that the judgment rendered in favor of the counterclaimant and against the plaintiff bank for $8,000 upon his counterclaim be allowed as a credit and offset upon said indebtedness so found due the plaintiff from the counterclaimant. The decree then credited the said amount of $39,201.38 with said judgment of $8,000, ordered that said judgment is satisfied by said credit and offset and decreed that the defendants pay the plaintiff the sum of $31,201.38, together with costs and attorney fees within 10 days and that in default thereof that the premises or so much as may be sufficient to realize the amount due plaintiff shall be sold subject to prior liens of the Chicago and St. Louis banks. To reverse this decree James H. Burr and Annette Burr prosecute this appeal and to reverse the judgment rendered by the court upon his counterclaim James H. Burr also appeals.

Counsel for appellants insist that the decree should be reversed because appellee failed to properly allege and prove that it was the owner of the notes secured by the trust deeds sought to be foreclosed, that the decree erroneously found the aggregate amount due on all the notes secured by both trust deeds and directed that the premises conveyed by both trust deeds be sold en masse to pay said amount and that the chancellor erred in setting off the judgment obtained by'James H. Burr upon his counterclaim against the amount due the plaintiff upon its notes so secured by said trust deeds and in decreeing the judgment satisfied by said set-off.

The unverified complaint alleged that appellants executed the notes secured by the trust deeds, indorsed them and delivered them to the Stewart State Bank and that the Stewart State Bank assigned them to appellee, which is now the legal owner and holder thereof. The answer of appellants, which was not verified, admitted the execution and delivery of the notes and that they represented an indebtedness owing the Stewart State Bank but denied that appellee was the legal owner and holder thereof. Appellee then, by a verified reply, averred that said notes were assigned pursuant to the authority of the auditor of public accounts of this State at the time appellee purchased the assets of the Stewart State Bank. The evidence is that appellee succeeded the Stewart State Bank on July 20,1931, and took over on that day the assets of that bank, and that among those assets were the notes and trust deeds described in the complaint. The vice-president and cashier of appellee identified those notes and trust deeds upon the hearing and testified that they were at that time in the possession of appellee and had been since they were acquired from the Stewart State Bank and that appellee was the owner thereof. Furthermore, appellants recognized that these notes and trust deeds belonged to appellee because on September 14, 1931, almost 2 months after appellee acquired these notes and trust deeds, appellants executed their quitclaim deed to the premises involved herein to appellee and on the following day James H. Burr executed with appellee an option agreement by the provisions of which the appellee obligated itself to hold until September 1,1932, the land involved herein and agreed to transfer the same to Burr upon his paying all monies evidenced by these several notes. Furthermore on January 16, 1933, in an instrument signed by Burr and directed to appellee, Burr referred to the lease executed by him on September 15, 1931, the quitclaim deed which he had executed the preceding day and the option which he executed and accepted on September 15,1931 as “A part of the certain mortgage on said above described property securing five notes described in said mortgage, dated May 5, 1927 . . . and the trust deed dated January 30, 1929 securing the payment of notes therein described.” Counsel for appellants argue, however, that even though appellee had taken over the assets of the Stewart State Bank, still there is no evidence in this record to the effect that appellee assumed in writing all of the liabilities of the Stewart State Bank and direct our attention to section 12 of chapter 16-A of our Banking. Act [Jones Ill. Stats. Ann. 10.13]. That section provides that any banking corporation may, upon certain conditions, sell its assets to another banking corporation, provided such other corporation assumes in writing all of the liabilities of said corporation as shown by its records, other than liabilities to its stockholders. We do not believe that appellants are in any position in this proceeding to invoke these provisions of the statute. They recognized the validity of these obligations and that they were held and owned by appellee, their answer did not deny the allegation of the complaint that these notes were assigned by the Stewart State Bank to appellee and under the pleadings and from the evidence found in this record, appellee’s failure to show a strict compliance with all of the provisions of said section 12 of the Banking Act cannot be availed of by appellants.

It is next insisted that the court erred in decreeing a sale of the entire 286 acres for the amount found due appellee and it is argued that the effect of so doing was to extend the lien of the first trust deed, which covered only the 240 acres tract, on and over the additional 46 acres which were covered by the second trust deed but not embraced within the provisions of the first trust deed and in this connection counsel refers to the case of Snow v. Haberer, 170 Ill. App. 265. That case holds that where two trust deeds covering two separate lots are foreclosed in the same proceeding, the decree should provide for the sale of each lot separately in satisfaction of the amount found due on the note secured by the trust deed covering the particular lot therein described inasmuch as the debt evidenced by each note can only be satisfied out of the land described in the trust deed to secure the payment of the same. Counsel for appellants concede that the quitclaim deed which conveyed to appellees the entire 286 acres and which was executed by appellants to appellee on September 14, 1931, was given as additional security for the indebtedness evidenced by all the notes for the payment of which both trust deeds were executed but counsel insists that this quitclaim deed was not a substitute for the two prior trust deeds and that it does not destroy the rights of redemption or the legal effect of those two trust deeds. The record in the instant case discloses that in November, 1932, appellant James H. Burr defaulted in his payments as provided by the lease and thereafter appellee instituted a forcible entry and detainer action to recover possession of the premises involved herein and was successful in the circuit court. Upon appeal, however, to this court we held that the lease and option both dated September 15, 1931, and the deed dated September 14,1931, which was acknowledged on September 15, 1931, should all be construed together in order to ascertain the intention of the parties and so construing them we concluded that the transaction was a mortgage and that the action of forcible entry and detainer could not be maintained. State Bank of St. Charles v. Burr, 283 Ill. App. 337. The opinion in that case discloses that appellants there and here insisted that the lease and deed were not in reality a lease and a deed but a mortgage and that the only way for the bank to obtain possession of the property-would be by a proceeding to foreclose the mortgage. In our opinion the chancellor in the decree entered in the instant proceeding correctly found that the quitclaim deed and lease were additional security for all the indebtedness due from appellants to appellee and as they covered the entire 286 acres, the chancellor correctly decreed the sale of the mortgaged property en masse to satisfy the amount so found due and none of appellant’s rights to redeem as provided by law were violated thereby.

Appellants next contend that the chancellor erred in setting off the judgment obtained by Burr on his counterclaim against the amount found due appellee upon its several notes and in decreeing that judgment satisfied by said set-off and insist that the judgment on the counterclaim was in favor of James H. Burr, while the amount so found due appellee was the obligation of both James H. Burr and Annette Burr. Counsel further insist that the judgment in favor of James H. Burr upon his counterclaim was a judgment obtained in a tort action and that it could not be set off against the amount found due appellee upon its original complaint. In Heiple v. Lehman, 272 Ill. App. 513, affirmed in 358 Ill. 222, this court said: " The recently adopted Practice Act of this State by section 38 thereof, Cahill’s St. ch. 110, ¶ 166 (¶ 162, ch. 110, Smith-Hurd Rev. St. 1933) grants the right of set-off to one or more defendants and against one or more plaintiffs, not only from mutual accounts existing between them, but in tort as well as contract, and for unliquidated damages as well as for liquidated accounts.” Under this and other authorities of this State, the chancellor was justified in setting off- against the amount found due appellee the $8,000 judgment rendered in favor of appellant James H. Burr upon his counterclaim and in decreeing that judgment satisfied by said set-off.

From what we have said the decree should be affirmed unless some reversible error occurred upon the trial of the issues made by the counterclaim and the reply thereto. This counterclaim was a cross-action of a purely legal nature and the chancellor properly transferred it to the law docket and caused the issues to be submitted to a jury for determination. The evidence upon the hearing disclosed that in September, 1931, appellant Burr had defaulted upon his payments to appellee as provided by the two trust deeds which appellee held and was also in default upon the payment of principal and interest upon the prior incumbrances held by the St. Louis and Chicago banks. The evidence is further that at this time appellants called at appellee’s bank and there voluntarily executed and delivered to appellee a conveyance to the entire farm of 286 acres and received back from appellee a lease therefor. By the provisions of that lease he agreed to pay appellee $165 each month beginning March 15, 1932, and ending February 28, 1933. In November, 1932, he had defaulted upon these, payments. The farm was occupied by A. J. Guhl, a tenant under Burr. On February 28, 1933, appellee rented the farm to William Walter for a 3-year term beginning March 1, 1933, and ending February 28, 1936, at an annual rental of $1,430 payable in monthly instalments of $120 for 11 months and $110 for the twelfth month of each year. Walter went into possession and occupied the farm from March 1, 1933 to March 1, 1936, and paid the stipulated rent. Counsel for appellant Burr contends that the evidence tends to prove that the conduct of appellee in instituting the forcible detainer proceedings and in placing its tenant Walter on the place was illegal and done with an evil purpose and with the intent to compel Burr to surrender all his right, title and interest in the premises and to ruin him financially. We have read the evidence as abstracted and agree with the trial court that as a matter of law, the testimony in this record instead of showing that appellee acted wrongfully or maliciously, disclosed that it proceeded in good faith, accepted a conveyance from appellants for the farm for what it purported to be and it does not follow that appellant Burr is entitled to recover vindictive or exemplary damages simply because appellee resorted to the courts to gain possession of that which appellant Burr had obligated himself to give. The evidence is also that the amount which appellee received from Walter, the tenant, represented the entire income from the farm. The jury awarded Burr $8,000 which was $3,710 more than appellee received. We are of the opinion that the verdict of the jury more than compensated appellant Burr for being deprived of the use of this property during the period Walter was in possession thereof. We have examined the instructions complained of and those tendered by appellant and refused and have not overlooked counsel’s contention that the trial court erred in refusing to allow witnesses called by appellants to give their opinions as to the value of the farm before and after the claimed trespass. In our opinion no error was committed upon the trial of the counterclaim which would require a reversal of this judgment and the decree in this cause does substantial justice between the parties and it should be affirmed.

The judgment in State Bank of St. Charles v. Burr, Gen. No. 9,218, is therefore affirmed and the decree in State Bank of St. Charles v. Burr, Gen. No. 9,210 is also affirmed.

Judgment and decree affirmed.


author: Mr. Presiding Justice O’Connor

text:
    The People of the State of Illinois, Defendant in Error, v. Jean Anderson, Plaintiff in Error.
    Gen. No. 39,946.
    Opinion filed April 25, 1938.
    James P. Byrnes, of Chicago, for plaintiff in error.
    Thomas J. Courtney, State’s Attorney, for defendant in error; Edward E. Wilson, John T. Gallagher, Melvin Starkel Rembe, Blair L. Varnes, Assistant State’s Attorneys, of counsel.
   Mr. Presiding Justice O’Connor

delivered the opinion of the court.

By this writ of error the defendant, Jean Anderson, seeks to reverse a judgment of the municipal court of Chicago, by which she was found- guilty of contributing to the dependency of her two children and sentenced to confinement in the county jail of Cook county for three months.

The record discloses that on October 20, 1937, an information was filed by leave of court which charged that defendant on October 16, 1937, “did knowingly and wilfully cause, aid and encourage” her two children (a son 14 years and a daughter 13 years of age) “to become dependent and neglected . . . and did knowingly and wilfully fail to do that which did directly tend to prevent such state of dependency and neglect to-wit: did eject said Children from their home at 4:00 A. M. October 16, A. D. 1937,” contrary to the statute.

In the order of October 20, by which the information was permitted to be filed, it was further ordered that since defendant had been arrested without warrant, capias, or other writ, and was present in open court, that she be held to bail by depositing $500 in cash, and the matter was continued until the next day. On the next day an order appears in the record which recites that the matter came on for hearing; that she entered a plea of not guilty, waived a jury, the court heard the evidence and entered a finding that “The court finds the defendant, Jean Anderson, guilty in manner and form as charged in the information herein, wherefore it is ordered that the same be entered of record herein.” And the order further shows that the court then pronounced judgment on the finding of guilty, “and it is considered and adjudged by the court that said defendant is guilty of the criminal offense of Contributing to the Delinquency of her children Jean Putney and Carl Putney,’ on said finding of guilty,” and she was sentenced to a term of 3 months in the county jail. Thereupon the defendant moved the court to vacate the judgment and the matter was continued until the next day; on the latter date another order was entered continuing the matter until November 19, on which day another order was entered continuing the matter until November 26. November 26 the following order appears in the record: “Leave given to amend record to conform with Judgment nunc pro tunc,” and it was further ordered that defendant’s motion to vacate the judgment of October 21 be overruled. The evidence is not in the record. December 7 the following “Stipulation & Agreement as to Interpretation of Record” was filed which shows, inter alia, that on November 26 the court authorized the clerk to draw a line through the word ‘ ‘ delinquency” as it appeared in the judgment order and insert in lieu thereof the word “dependency.”

Defendant contends that the information did not charge the defendant with the commission of any crime mentioned in the statute. The act which plaintiff was charged with violating is entitled, “An Act to define and punish the crime of contributing to the dependency and neglect of children,” (approved June 23, 1915), ch. 38, pars. 100, 101, Ill. Rev. Stat. 1937 [Jones Ill. Stats. Ann. 37.084, 37.085]. The act is in two sections. Section 1 defines a dependent and neglected child to mean any male under the age of 17 or any female under the age of 18 years who “for any reason is destitute, homeless or abandoned; or dependent upon the public for support; or has not proper parental care or guardianship; or habitually begs or receives alms; or is found living in any house of ill fame or with any vicious or disreputable person; or has a home which by reason of neglect, cruelty or depravity on the part of its parents, guardian, or any other person in whose care it may be is an unfit place for such child; and any child who while under the age of ten years is found begging, peddling or selling any articles or singing or playing any musical instrument for gain upon the street or giving any public entertainments or accompanies or is used in aid of any person so doing.” And section 2 defines what constitutes contributing to dependency and neglect and provides for a penalty, etc. So far as material here that section provides: “Any parent, . . . having the custody of a male under the age of 17 years or a female under the age of 18 years, who shall knowingly or wilfully cause, aid or encourage such person to be or to become a dependent and neglected child as defined in section 1, or who shall knowingly or wilfully do acts which directly tend to render any such child so dependent and neglected, or who shall knowingly or wilfully fail to do that which will directly tend to prevent such state of dependency and neglect shall be deemed guilty of the crime of contributing to the dependency and neglect of children.”

In the instant case it seems to be conceded that defendant was the mother by a former marriage of the two children mentioned in the information, and the only charge made against her in the information is that she did “knowingly and wilfully fail to do that which did directly tend to prevent such state of dependency and neglect, to-wit: did eject said Children from their home at 4:00 A. M. October 16, A. D. 1937.” We think this charge does not allege that the two children are dependent and neglected children within the meaning of section 1 of the act, and unless this were so the defendant could not be found guilty of a violation of the act because section 2 of the act merely defines what constitutes contributing to the dependency and neglect of children named in section 1. There is no averment that the children are (1) “destitute, homeless or abandoned; (2) or dependent upon the public for support; (3) or has not proper parental care or guardianship; (4) or habitually begs or receives alms; (5) or is found living in any house of ill fame or with any vicious or disreputable person; (6) or has a home which by reason of neglect, cruelty or depravity on the part of its parents, . . . is an unfit place for such child”; (7) nor that either child is under the age of 10 years; nor that they were “found begging, peddling or selling any articles or singing or playing any musical instrument for gain upon the street,” etc. •

The judgment of the municipal court of Chicago is reversed.

Judgment reversed.

McSurely and Matchett, JJ., concur.


author: Mr. Presiding Justice O’Cototor

text:
    Samuel Bransky, Appellee, v. Joseph Lebow, Appellant.
    Gen. No. 39,967.
    Opinion filed April 25, 1938.
    Rehearing denied May 9, 1938.
    A. A. Schwarzbach and Julius S. Neale, both of Chicago, for appellant; Clarence T. Morse, of Chicago, of counsel.
    Edward P. Saltiel and George L. Pilkington, both of Chicago, for appellee.
   Mr. Presiding Justice O’Cototor

delivered the opinion of the court.

October 22,1936, Samuel Bransky filed his complaint in chancery against Joseph Lebow and John Toman, sheriff of Cook county, praying that a judgment entered against him by default in favor of Lebow in an action to recover damages for an assault upon the person, be set aside, and further, that the sheriff be restrained from taking Bransky into custody on a writ of capias ad satisfaciendum issued on the judgment. The complaint, which was verified, set up that Bransky had not been served with process in the action for damages and knew nothing about the judgment until after the capias had issued for his arrest; that the action for damages was begun July 11, 1932, in the superior court of Cook county, and that the alias capias was issued March 5,1936, by virtue of which the sheriff took plaintiff into custody. It was further alleged that defendant had a good defense on the merits, etc. November 19, 1936, plaintiff filed his verified petition setting up many of the matters alleged in his complaint and praying that a writ of injunction issue restraining the sheriff from taking custody of plaintiff. On that day an order was entered that a writ of injunction issue restraining the sheriff “from enforcing the capias Ad Satisfaciendum, from taking into custody the said Samuel Bransky until the further Order of this Court.” Thereupon plaintiff filed his injunction bond of $2,500, and the writ issued commanding the sheriff to ‘ Desist and refrain from taking into custody Samuel Bransky under a capias ad satisfaciendum issued in case No. 561191 Superior Court of Cook County.” Afterward, on February 17, 1937, defendant Lebow’s motion to strike the complaint was denied and he was ruled to answer. March 10 following he filed his answer. Afterward, on June 25, the case was heard by the chancellor, and after hearing the testimony of witnesses it was ordered that the suit be dismissed for want of equity. July 16, 1937, Lebow filed his petition setting up what had been done in the case and praying that he be allowed $600 against Bransky, “in accordance with Section 12, chapter 69, Injunctions,” or in the alternative, if the court refused to allow the $600 for damages, which was for attorneys’ fees incurred by Lebow in having the complaint dismissed, that the petitioner be allowed a judgment for 10 per cent of the judgment of $4,700, in accordance with “Section 8, Chapter 69 Injunctions.” Afterward, in November, 1937, Bransky filed Ms answer to the petition denying liability, and on December 8, 1937, an order was entered denying the prayer of Lebow’s petition for attorneys’ fees, and it is from this order that he appeals.

Section 8 of the chapter on Injunctions (sec. 8, ch. 69, Ill. Rev. Stat. 1937 [Jones Ill. Stats. Ann. 109.356]) is the basis of Lebow’s claim for attorneys’ fees. Hollister v. Sobra, 264 Ill. 535. That section provides: “Before an injunction shall issue to enjoin a judgment, the plaintiff shall give bond to the owner thereof, in double the amount of such judgment, with sufficient surety approved by the court, judge or master, conditioned for the payment of all moneys and costs due to the owner of the judgment, and such damages as may be awarded against the plaintiff in case the injunction is dissolved. If the injunction be dissolved in whole or in part, the plaintiff shall pay, exclusive of legal interest and costs, such damages as the court shall award, not exceeding ten per centum on such part as may be released from the injunction.” In the instant case payment of the judgment of $4,700 rendered on the verdict of the jury in the assault case, wMch Lebow brought against Bransky, was not enjoined. The injunction only restrained the sheriff from taking and holding Bransky under the capias ad satisfaciendum. The injunctional order and writ did not prevent the issuance of an execution so that levy might be had on any property belonging to Bransky. Moriarty v. Galt, 23 Ill. App. 213, affirmed 125 Ill. 417.

The order of the superior court of Cook county ap- ‘ pealed from is affirmed.

Order affirmed-

McSurely and Matchett, JJ., concur.


text:
    Printers Corporation and Howard, Wood & Fischer, Inc., Appellees, v. Hamilton Investment Company, Appellant.
    Gen. No. 39,976.
    Opinion filed April 25, 1938.
    Rehearing denied May 9, 1938.
    Rothbart & Rosenfield, of Chicago, for appellant.
    Luster & Luster, of Chicago, for appellees.
   Mr. Presiding Justice O’Connor

delivered the opinion of the court.

Each plaintiff borrowed money from the defendant and each executed its instalment note for more than the amount borrowed. The payment of each was secured by chattel mortgage. Defendant caused judgment by confession to be entered for the face of the notes less what had theretofore been paid. Each sought to enjoin defendant from collecting that part of the judgment which was in excess of the money borrowed. By agreement the causes were tried together, a decree entered as prayed for, and defendant appeals.

The record discloses that on December 5, 1935, the Printers Corporation borrowed $2,30() from defendant and executed its judgment note secured by a chattel mortgage for $2,760, payable in 25 monthly instalments ; the first 15 instalments were $75 each, the next 9 $175 each, and the last one $60. The instalments were paid when due, including the July, 1936, instalment. July 21,1936, defendant demanded immediate payment of the balance of the face of the note which included the $460 over and above the amount borrowed, and 3 days afterward, July 24, caused judgment by confession to be entered for $2,423.55. February 6, 1936, Howard, Wood & Fischer, Inc., borrowed $2,000.39 from defendant, and on that day executed its judgment note for $2,255.39, secured by a chattel mortgage. May 8, 1936, Howard, Wood & Fischer borrowed $350 from defendant and executed its judgment note for $390, secured by a chattel mortgage. The first of these notes was payable in 18 monthly instalments, the first 17 for $100 each due on the 15th of each month, and the final instalment of $555.39 due August 15, 1937. The other note was payable in 12 monthly instalments, the first 11 for $32 each, and the final instalment of $38 due May 8, 1937. The instalments on these two notes were paid, together with interest, as they fell due, but in July defendant demanded the entire amount then unpaid and on July 24, 1936, caused judgment by confession to be entered against Howard, Wood & Fischer, Inc., for $2,185.18. The several notes bore interest at 6 per cent per annum “and after maturity at the highest legal rate.” Each of the judgments included $100 attorney’s fees.

August 3, 1936, each plaintiff filed its motion and petition to vacate the judgment against each, the motions were denied and shortly thereafter each filed a second motion which was likewise denied, and on the same date, August 14, the instant suit was brought by both plaintiffs. On that date a temporary writ of injunction issued without notice, enjoining defendant from the collection of that part of the judgment over and above the amount actually borrowed and remaining unpaid. Three days later, August 17, each plaintiff paid defendant that part of the judgment which had not been enjoined and took defendant’s receipts therefor.

A short time before the judgments by confession were entered, each plaintiff being in need of additional money to buy additional machinery borrowed money from the Landfield Finance Company. The Printers Corporation borrowed $6,000, and Howard, Wood & Fischer, Inc., $3,950, each executing its chattel mortgage on the same properties covered by the chattel mortgage held by defendant. There is some dispute in the evidence as to whether part of the moneys borrowed from the Landfield Finance Company was to be used to take up the notes held by defendant and involved in the instant case; but we think this question is not of importance here.

But two points need to be decided. (1) Defendant contends that plaintiffs had an adequate remedy at law by filing their motions to open up the judgment entered by confession and for leave to defend; that in such cases the court considers the equities of the case, and that plaintiffs’ motions having been denied the matter is res adjudicóla and cannot be raised, as is sought to be done by filing the complaint in equity in the instant case; that if plaintiffs were not satisfied with the decision of the trial court in denying their motions to open up the judgments and for leave to defend, they should have prosecuted an appeal, and not having done so the matter is not subject to review. In Hopkins v. Medley, 99 Ill. 509, cited by defendant, plaintiff filed a petition at law for partition. The defendant filed an answer, setting up certain equitable defense, which the court disallowed and entered a judgment directing a partition of the premises. On appeal to the Supreme Court the judgment was reversed and the cause remanded. Pending the appeal defendants in the partition suit filed their bill in equity setting up the proceedings under the petition in the partition suit, and also the same equitable matters relied upon as a defense in that proceeding, and praying that the prosecution of the partition suit be enjoined. A demurrer was sustained to the bill, suit was dismissed, and on appeal to the Supreme Court the decree was affirmed. The court said (p. 512): “It is true, as claimed, the statute expressly recognizes the distinction between partitions at law and in equity, yet it does not therefore follow that the rights of the parties may not be as fully enforced in the one proceeding as the other. The primary rights of the parties are the same, in either case, and may be enforced as effectually in one forum as the other. The only difference between the two relates to the procedure. . . .

“When the partition is at law, the rules of pleading and practice which obtain in courts of law control, except so far as modified by the statute. So, the practice and pleadings in courts of equity govern when the partition is in equity. It is a familiar principle that courts of equity will not interpose, by injunction, to restrain the enforcement of a judgment at law where the rights of the complainant might have been enforced and protected in the trial at law, to the same extent as in a court of equity.”

And in Clark v. Chandler, 286 Ill. 180, also cited by counsel for defendant, the court said (p. 183): “Appellants here were not deprived of any defense in the Appellate court nor did their defense involve a purely equitable right or remedy which they could not present and urge in that court.” While it is true that in motions to vacate judgments entered by confession it is said that courts exercise equitable powers, yet we think it cannot be said that in such case the court exercises as broad equity powers as does a chancellor in a suit in equity. And we think this distinction has not been entirely abrogated by section 44 of our Civil Practice Act (ch. 110, Ill. Rev. Stat. 1937 [Jones Ill. Stats. Ann. 104.044]). In the instant case the decree entered found that the indebtedness secured by the two chattel mortgages had been fully paid, and it was decreed that the chattel mortgages were therefore null and void and of no further effect; that the clerk of.the court return $1,000 which plaintiffs had theretofore deposited with him on August 14; that the temporary injunction be made permanent, and the judgments entered by confession in the two suits were decreed not to be a lien on the property of each of the plaintiffs respectively. We are of opinion that plaintiffs’ remedy in seeking to have the judgments by confession opened up and for leave to defend, was not as complete and adequate as that afforded by a court of chancery.

(2) The other contention of counsel for defendant is that “Courts of equity cannot substitute their judgment for that of contracting parties in the absence of fraud, accident or mistake, or some other recognized principle of equity”; that the judgments sought to be enjoined are legal in every respect and that the decree in the instant case was entered by the chancellor because he was of opinion that the enforcement of the judgment was " shocking to the conscience of the court.” And in support of this counsel cite Manufacturers’ Finance Co. v. McKey, 294 U. S. 442. On the other side, counsel for plaintiffs contend that the decree was entered by virtue of the provision of sec. 7, ch. 69, Ill. Rev. Stat. 1937 [Jones Ill. Stats. Ann. 109.355]. That section provides: “so much of any judgment at law shall be enjoined as the plaintiff shall show himself equitably not bound to pay, and so much as shall be sufficient to cover costs. ’ ’

The chancellor in deciding the case said: “This right to maintain the bill to restrain the collection of the judgment is predicated upon the statute. The statute provides that a judgment may be enjoined when it appears to the Court of equity that they are not equitably bound to pay; . . .

“The statute intervenes after the judgment is entered, not before; . . . when it appears to a court of equity that equitable reasons exist that should not compel them to pay it”; that the equitable reason contended for was that plaintiffs had made the monthly payments as provided for in the notes; that there was no default at the time the judgments were entered; that defendant had a right to have the judgments entered because each of the notes provided that such judgment might be entered “at any time hereafter.” The court then discussed the evidence and continuing said: “They made their payments regularly, and no default at any time occurred with respect to the payments called for by the note. It is clear that there is in this case considerable feeling between cómpetitive money loaning concerns. The feeling runs quite high, in view of the tirade the witness, Rees, indulged in against the Land-field Company.” We think it clear that plaintiffs ought not to be required to pay the face of the notes when part of the consideration was that each plaintiff would be permitted to pay the notes in instalments running over a period of about two years. And when defendant breached this agreement by demanding payment in full although there was no default, we think that part of the consideration in excess of the amount of money borrowed failed. Defendant having breached its contracts, cannot thereafter seek their literal enforcement.

The McKey case, 294 U. S. 442, is not in point. In that case Grigsby-Grunow Co., a corporation, entered into a contract with another, according to the terms of which the latter agreed to purchase from the former certain accounts receivable, etc., and agreed to collect them and turn over the proceeds as collected, for which services the assignee was to be paid about 28 per cent. The Grigsby-Grunow Co. was afterward in bankruptcy. That court allowed the assignee 7 per cent interest instead of the 28 per cent, as the contract provided. The Supreme Court held this was erroneous; that the contract was valid and binding in Illinois, and said (pp. 448-9): “The mere fact that a party is obliged to go into a federal court of equity to enforce an essentially legal right arising upon a contract valid and unassailable under controlling state law does not authorize that court to modify or ignore the terms of the legal obligation upon the claim, or because the court thinks that these terms are harsh or oppressive or unreasonable. A party may stand upon the terms of a valid contract in a court of equity as he may in a court of law. ‘If he asks no favors, he need grant none. But if he calls on a court of chancery to put forth its extraordinary powers and grant him purely equitable relief, he may with propriety be required to submit to the ‘operation of a rule which always applies in such cases and do equity in order to get equity. ’ ” In that case the assignee of the accounts was brought into the bankruptcy court and was standing on his contract, which the Supreme Court held he had a right to do. But in the case at bar the defendant, when it caused judgments to be entered on the notes, breached its agreement, which was that it would permit the maker of the notes to pay in monthly instalments over a period of 25 months.

The decree of the circuit court of Cook county is affirmed.

Decree affirmed.

McSitrely and Hatchett, JJ., concur.