text:
    Lon Miller, Creditor, Appellant, v. Wm. E. Schackmann, Administrator, Appellee.
    Heard in this court at the February term, 1941.
    Opinion filed October 27, 1941.
    Claude W. McDaniel, of Casey, for appellant.
    Kasserman & Kasserman, of Newton, for appellee.
   Mr. Justice Culbertson

delivered the opinion of the court.

This is an appeal from an order of the circuit court of Jasper county, Illinois, on a petition of a creditor (Lon Miller, appellant, hereinafter called plaintiff), for removal of the public administrator, Wm. E. Schaekmann, appellee (hereinafter called defendant), as administrator of a certain estate, and for citation to compel discovery of assets, which order denied the prayer of the petition that certain notes and mortgages be required to be inventoried in such estate, and likewise denied the prayer of the petition as to the removal of the administrator.

The action arose on the petition of the appellant, as a creditor, for the removal of the public administrator, who was appointed as administrator in ancillary proceedings in this State in the matter of the estate of Lillie M. Kasserman, deceased. It was the contention of the petitioner that the public administrator had failed to inventory as assets in Illinois, the mortgages owned by the deceased, which were secured by real estate located in Jasper county, Illinois. Such mortgages had been held in Florida by the executor of the estate of the deceased, and primary administration was had under the will of the deceased, in Florida. There was a deficiency of assets to pay Illinois creditors in the ancillary administration in this State. The petitioner was a first-class creditor whose claim had been allowed, and the citation was designed to force the administrator to inventory the mortgages referred to in order to make such mortgages available in Illinois, as assets for payment of .claims allowed in this State. The prayer of the petition included the request to remove the administrator. Upon hearing, in the county court of Jasper county an order was entered finding that the mortgages should have been inventoried in such county. On appeal to the circuit court of Jasper county, such order was reversed, and the court there found that the mortgages were located in Florida at the time of the death of the deceased, and that the inventory of such notes and mortgages in the principal administration in Florida was proper and exclusive.

On appeal to this court the appellee filed a motion to dismiss the appeal on the ground that appellant had failed to file a sufficient abstract of record. Such motion to dismiss the appeal was made long after the time fixed for the filing of briefs of appellee and was, therefore, made too late for consideration by this court. As a matter of fact, the abstract, as submitted by appellant, was entirely adequate in view of the only issue which is presented for the consideration of this court. The motion to dismiss the appeal is, therefore, denied, and we shall proceed to a consideration of this case on the merits.

While a number of collateral points are made by the plaintiff, the only issue, in fact, to be determined is whether or not the notes, and the mortgages securing such notes, on Illinois real estate, were required to be inventoried in this State by the administrator in the ancillary administration here. The notes and mortgages had been disposed of in the principal administration in Florida.

It is contended by the plaintiff that the situs of the notes and mortgages for the purpose of inventorying of assets, under the provision of the Wills Act. Chapter 148, 1939 Ill. Rev. Stat., sec. 10 [Jones Ill. Stats. Ann. 110.222], is where the debtor resides, and is not at the domicile of the decedent. The language of the provision of the statute involved, which was in force until January 1, 1940, the effective date of the new Probate Act is, “For the purpose of granting administration of both testate and intestate estates, the situs of specialty debts shall be where the instrument happens to be, and of simple contract debts and other choses in action, where the debtor resides.” The decedent died on April 20,1935. The fact that Florida was the domicile of such decedent had been established and was not questioned in this proceeding. Principal administration was had in Florida (after an unsuccessful attempt was made to establish such administration in Illinois). Ancillary administration was instituted on October 7, 1937. There had been a distribution in kind of the mortgage notes involved in this proceeding, to a residuary legatee, pursuant to the will of the deceased.

Mo attempt is therefore made to contend that the Probate Act now in force in this State is applicable to this proceeding, but the determination of whether or not the circuit court properly refused to compel the administrator to inventory the notes and mortgages referred to, in Illinois, depends upon consideration of the section of the act referred to in this opinion, and the law relating to this problem, whether by decision or statute, uneffected by the provisions of the new Probate Act.

While many references may be found in cases decided in this and other States, characterizing notes secured by real estate mortgages, as “choses in action,” when the language “specialty debts” is used and contrasted with language referring to “simple contract debts and other choses in action,” it is obvious that the term “specialty debts” includes obligations secured by real estate mortgages. Specialty debts have been interpreted in certain legal compilations as including real estate mortgages (58 Corpus Juris 825). Since the time of the amendment of the Illinois Act in 1909, to the time of the adoption of the present Probate Act, the situs of specialty debts for purposes of administration, is where the instrument happens to be (Harris v. Chicago Title & Trust Co., 251 Ill. App. 240, 259, aff’d 338 Ill. 245; Martin v. Central Trust Co., 327 Ill. 622).

As stated in the case of Martin v. Central Trust Co., supra, at page 634 “The word ‘specialty’ in its technical significance, imports an instrument under seal for the payment of money. ... As the bonds were specialty debts and were in Illinois at the time the testator died, they were properly inventoried as property belonging to the estate in Illinois.” In the instant case, the mortgage obligations, which were likewise under seal, were in Florida at the time the testatrix died, and we must, therefore, conclude, on a consistent interpretation of the section of the act referred to, that it would not have been proper to inventory such assets in Illinois, and that they were properly inventoried in the primary administration in Florida, where such mortgages “happened to be” at the time of the death of the decedent.

We therefore, conclude, under the facts and circumstances in this case, that the order of the circuit court refusing to order that such mortgages be inventoried by the ancillary administrator with will annexed, in this State, was proper.

The order of the circuit court of Jasper county appealed from, is, therefore, affirmed.

Affirmed.


source: Caselaw Access Project

author: Mr. Justice Dady

license: Public Domain

text:
    R. B. Hetherington, Appellee, v. Continental Insurance Company of New York, Appellant.

      Heard in this court at the May term, 1941.
    Opinion filed October 27, 1941.
    Charles T. Flota, of Harrisburg, and Klein, Harrow & Wilkinson, of Chicago, for appellant; Arthur W. Klein and Joseph Harrow, both of Chicago, of counsel.
    S. D. Wise and Wheatley & Combe, all of Harrisburg, for appellee.
   Mr. Justice Dady

delivered the opinion of the court.

In a trial before the court, without a jury, the plaintiff obtained a judgment against the defendant for $843.80 and costs. Defendant appeals.

The' complaint filed September 16, 1940, alleged and the- undisputed facts show that plaintiff was the owner of a four-door sedan which he purchased new in April 1938, for the sum of $1,204, and which the defendant insured against all loss and damage by collision in excess of $50; that on December 23, 1939, while the policy of insurance was in force, the car was damaged in an accidental collision; that plaintiff and defendant attempted but were unable to agree upon the amount of loss and damage, and that the policy among other things provided that:

“In case the Assured and this Company shall fail to agree as to the amount of loss or damage, each shall, on the written demand of either, select a competent and disinterested appraiser. The appraisers shall first select a competent and disinterested umpire; and failing for fifteen (15) days to agree upon such umpire, then, on request of the Assured or this Company, such umpire shall be selected by a judge of a court of record in the County and State in which the appraisal is pending. The appraisers shall then appraise the loss and damage stating separately sound value and loss or damage; and failing to agree, shall submit their differences only, to the umpire. An award in writing" of any two, when filed with the Company, shall determine the amount of sound value and loss or damage.”

The complaint further alleged and the undisputed facts show that on March 5, 1940, defendant made a written demand on plaintiff for an appraisal of the loss and damage in accordance with the above quoted provision of the policy; that pursuant to such demand the plaintiff selected Bert W. Rude as one of the appraisers and the defendant selected John Stockhowe as the other appraiser; that on April 24, 1940, plaintiff and defendant entered into a written agreement which recited that said appraisers should select an umpire, and should then estimate and appraise the loss, stating in writing (1) Sound Value and (2) Loss "and Damage. Said agreement further stated that:

‘ ‘ The award of any two, in writing, shall determine the matters hereby submitted for appraisal.

The Sound Value to be ascertained is the actual -cash value of said property at the place of, and immediately prior to, the occurrence of said collision (with proper deduction for depreciation howsoever caused.)

The Loss and Damage to be ascertained is the actual direct loss or damage by said collision.

Neither said sound value nor said loss or damage shall exceed what it would have cost the first party to repair or replace the said damaged or destroyed property, at the time of the occurrence of said collision with material of like kind and quality, less depreciation,

The complaint further alleged and the undisputed facts show that the appraisers neglected for more than 15 days to appoint an umpire, whereupon the plaintiff made a written request to D. F. Rumsey, Judge of the circuit court of Saline county, requesting the appointment of an umpire, and said judge on June 8, 1940, pursuant to such request, appointed Oscar Turner as such umpire; that thereafter said appraisers and said umpire on June 14, 1940, were sworn and qualified as such; that thereafter and on June 14, 1940, Stockhowe and Rude, as such appraisers, made an award in writing in which they found that the sound value of said automobile at the time of said collision and upset was $904, and that the loss and damage sustained by the plaintiff was $829. This award was duly filed with defendant. Under date of April 24, 1940, plaintiff and defendant entered into an additional agreement by which the defendant agreed to guarantee payment to plaintiff of towing charges in the sum of $10, and to guarantee payment to plaintiff of storage charges at the rate of $6 per month, and pursuant to such last agreement the plaintiff expended the sum of $33.20 for storage of the salvage of said automobile from December 23, 1939, to June 10, 1940.

By, the complaint, plaintiff claimed he was entitled to $779, the same being the amount of the loss and damage as fixed by the award after deducting $50 as the deductible portion of the loss, and the further sum of $43 representing the towing and storage charges which plaintiff alleged defendant had agreed to pay.

Defendant filed an answer and counterclaim. In both the answer and counterclaim the only material defense set forth is that the award of damages made by the appraisers was so grossly in excess of the plaintiff’s actual damages as to amount to fraud; that at the time of the accident the actual sound value of the plaintiff’s automobile was no more than six or seven hundred dollars, and that plaintiff’s automobile could have been repaired and restored to its original condition before the accident for $217.38. In the counterclaim defendant further alleged that the submission agreement was deliberately or indirectly misapprehended by the appraisers and the facts disregarded by them with the result that the alleged award became void or voidable because of fraud. Defendant asked to have said award set aside by reason of such fraud.

On motion of plaintiff the trial court struck the foregoing alleged defenses from the defendant’s answer and also struck the entire counterclaim. At the trial, defendant offered to prove that plaintiff’s automobile could be repaired and restored to its condition prior to the accident for the sum of $217.38, which evidence the trial court refused to admit. These rulings of the trial court have been assigned as error by the defendant.

The judgment entered by the trial court was the aggregate of the sums claimed in the complaint. Under the errors assigned by defendant, only that portion of the judgment dealing with the award is in controversy upon this appeal.

The allegations made by defendant in its answer and counterclaim that plaintiff’s automobile at the time it was damaged had a cash value of only six to seven hundred dollars and that the extent of the actual damage was only $217.38 instead of $829 as found by the appraisers, were admitted by plaintiff’s motion to strike and must be considered as true for the purpose of testing the sufficiency of defendant’s pleadings. We are thus confronted with the question whether this award of damages can be defended against or set aside on the ground of fraud because of its being so greatly in excess of the amount of the actual damages.

Plaintiff, relying upon such cases as Gerrish v. Ayres, 3 Scam. (4 Ill.) 245, 249, and Smith v. Douglass, 16 Ill. 34, insists that the appraisal in this case had all the force of an adjudication and precluded the parties from litigating the same subject matter.

We recognize the general rule that where an appraisal has been fairly conducted and is within the terms of the reference under which the controversy is submitted, the findings made by the appraisers in the absence of fraud or mistake will be binding upon the parties. (Podolsky v. Raskin, 294 Ill. 443; Igoe Bros, v. National Ben Franklin Ins. Co. of Pittsburgh, Pa., 110 N. J. Eq. 373, 160 Atl. 382.) It is equally true, however, that the courts will set aside an award where-ever it clearly appears that there has been fraud, misconduct or palpable or gross error or mistake (Commercial Union Assur. Co. v. Parker, 119 Ill. App. 126; Turner v. Hartford Fire Ins. Co., 185 Iowa 1363, 172 N. W. 166; Citizens Ins. Co. v. Hamilton, 48 Ill. App. 593).

Although the mere fact that an award is different in amount from what the court would have given, will not in itself necessitate setting it aside (Ross & Co. v. German Alliance Ins. Co. of New York, 86 Kan. 145, 119 Pac. 366) it is also true that if the amount is palpably excessive or inadequate an inference of fraud or mistake may be raised. (Turner v. Hartford Fire Ins. Co., supra; Second Society of Universalists v. Royal Ins. Co., 221 Mass. 518, 109 N. E. 384; Huested v. Patrons’ Mut. Fire Ins. Co. of Michigan, 223 Mich. 213, 193 N. W. 815.) In 29 Am. Jur. page 934, sec. 1251, it is said that a court will not substitute its own judgment for that of the appraisers or set aside the award for inadequacy or excessiveness unless it is so palpable and manifest as to indicate corruption or partisan bias on the part of the appraisers.” Lord Thurlow in Guynne v. Heaton, 1 Brown, O. C. 1, 9—cited in Second Society of Universalists v. Royal Ins. Co., supra, lays down the rule in the reverse situation (where the award is inadequate) that the inadequacy must be “so strong, gross, and manifest that it would be impossible to state it to a man of common sense without producing an exclamation at the inequality of it. ’ ’

We believe that in the case before us the marked difference between the amount found by the appraisers as the loss and damage, viz. $829, and the amount admitted under the pleadings as the actual loss and damage, vis. $217.35, was so great as to at least produce such an exclamation at the unfairness of the award and to create an issue on the question of fraud and mistake. The trial court should have permitted defendant’s allegations as to the actual sound value and the actual loss and damage coupled with the allegations of fraud to' stand in both the answer and counterclaim and it was error to strike these allegations from the answer and to strike the entire counterclaim. Defendant should also have been permitted to introduce evidence on the questions of sound value and loss and damage, and we think it was error for trial court to refuse this evidence. When this evidence is before it, the trial court will then be in a position to determine whether the award is in fact vitiated by fraud or mistake by reason of the claimed difference between the plaintiff’s damages as found by the award and the amount of the actual damage as shown by other testimony.

defendant contends that the trial court erred in excluding the testimony of the witness, Stockhowe. Stockhowe was the appraiser selected by the defendant, and defendant attempted to prove by him that he did not, in fact, agree with the findings made in the award but signed it only because he was under “the mistaken impression” that what the umpire and the other appraiser agreed upon was controlling by reason of the fact that they were in the majority. We fail to see how Stockhowe’s explanation of his reasons for signing the award was at all material. Under the explicit terms of the submission agreement it was provided that “the award of any two in writing shall determine the matters hereby submitted for appraisal.” Although the umpire did not sign the award — according to Stockhowe, the umpire and the plaintiff’s appraiser, Eude, joined in the argument against him as to the findings to be made in the award and the award as filed did represent the views of the majority. As a matter of fact, Stockhowe was not mistaken in Ms impression that a majority of two controlled in the making of the award and the mere fact that he signed because of his impression that he had been overruled by the other appraiser and umpire did not furnish any ground for setting the award aside.

Defendant also offered to show that Stockhowe, who was a car dealer, had an opinion that the plaintiff’s car was worth only $600 at the time of the accident and could be repaired for not exceeding $350. TMs opinion was in direct contradiction of the findings made in the written award and we do not think that under the circumstances of tMs case Stockhowe was competent to testify as to an opinion different from that expressed in the award. The rule for the exclusion of such testimony is laid down in Schmidt v. Glade, 126 Ill. 485, at page 492, as follows: ‘ ‘. . . where the arbitrators recite in their award that they disposed of a matter, entrusted to their consideration, in the manner required by the agreement for submission, it cannot be shown by parol evidence, that they disposed of such matter in another and different manner.” (See also Patriotic Order Sons of America Hall Ass’n v. Hartford Fire Ins. Co., 305 Pa. 107, 157 Atl. 259.) We hold there was no error in the trial court’s refusal to admit this testimony.

The judgment of the trial court is reversed and the cause is remanded with directions to the trial court to overrule the motion of plaintiff to strike the allegations in the answer that the award was so grossly in excess of the actual damages as to amount to fraud, that the actual sound value of the car was no more than $600 or $700 and that the car could have been repaired and restored to its original condition for $217.38, and with directions to overrule the motion to strike the counterclaim and for further proceedings consistent with this opinion.

Defendant’s abstract did not comply with the rules and plaintiff was compelled to file an additional abstract which contained the same number of pages as the original abstract. In taxing costs, no costs will be assessed against plaintiff for the printing of defendant’s abstract.

Reversed and remanded with directions.


text:
    Adeline Baker, Appellant, v. City of Granite City, Appellee.

      Heard in this court at the May term, 1941.
    Opinion filed October 27, 1941.
    Ben M. Creamer, of East St. Louis, and Frank E. Doyle, of St. Louis, for appellant.
    Roscoe Forth, of Granite City, for appellee.
   Mr. Justice Dady

delivered the opinion of the court.

Plaintiff while walking on a public sidewalk in Granite City stepped on the cover of a catch basin. The cover tilted and slid aside and she fell into the basin She brought this action against the city to recover for the injuries she sustained. The case was submitted to. a jury and a verdict of $500 was returned in favor of plaintiff. On defendant’s motion the court entered a judgment for the defendant notwithstanding the verdict. To reverse such judgment, plaintiff has taken this appeal.

The specific charge of negligence in the complaint was that defendant carelessly and negligently permitted such cover to remain in a dangerous and unsafe condition, and knew or by the exercise of reasonable care could have known that the catch basin was a dangerous trap, endangering the life and limb of any pedestrian who might walk thereon.

The catch basin referred to was located in the sidewalk at the southeast corner of the intersection of two streets in Granite City. It was about three feet deep and was covered with an iron lid which was level with and was an integral part of the sidewalk. This cover was about 22 inches in diameter and rested in place on the flange of a circular iron rim or base.

Plaintiff testified that about 1:00 p. m. on October 9, 1939, while walking along the sidewalk she stepped on the cover of the catch basin; that before stepping on it she saw the cover; that the cover “looked all right, and there was nothing apparently wrong with it”; that when she stepped on the cover it tilted and slipped off and she fell into the basin; that a man named McGee helped her out; that after getting out of the catch basin she carefully observed the flange or rim around the basin on which the cover rested and such flange was “very much corroded with rust” and was “filled with rust and corrosion”; that the cover was uneven around the edge and “beveled off until it was as thin as a piece of cardboard,” and that the lower edge of the cover was “sort of worn off.”

McGee, a witness for plaintiff, testified that while he was sitting on the curb at the corner waiting for a streetcar he heard an outcry from the plaintiff and turned around and saw her in the catch basin and helped her out; that they replaced the cover and that about that time the streetcar came along; that he did not have an opportunity to observe or examine the condition of the cover because it was necessary for him to take the streetcar and that he and the plaintiff boarded the streetcar together.

The trial of this case took place on November 15, 1940. One Harmon, assistant superintendent of streets, a witness for defendant, testified: “The lid (cover) had been on there probably two years, up to the present time. I helped put it on there, at which time it was new. . . . They were on there about two years prior to now. Mr. Curtwright and I put them on. ... I don’t know how long prior to October, 1939’, it was actually put on there, but I believe in the spring of 1939. I am sure it was. -It was new in the spring and this happened in October.” Curtwright, a witness for defendant, testified he was superintendent of streets and that “I am pretty sure it (the cover) was put on there in the spring of 1939 by Mr. Harmon and myself. ... I am positive that lid was put on there new in the spring of 1939. . . . There was a very little rust on the bottom of the lid when it was installed in the spring of 1939. There is a good deal on it now, the result of moisture in the catch basin.”

Defendant’s witnesses testified that the flange was not replaced at the time the new cover was installed, but had been in and a part of the catch basin for some unknown period prior to such time; that no other cover was thereafter placed over the catch basin prior to the accident; that prior to the accident the city had received no complaint about any unsafe or dangerous condition of the catch basin or cover; that Harmon and Curtwright examined the catch basin and cover immediately after the accident and found the cover in place; that they then walked over the cover to see if it would jump off when stepped on and found that it did not, and that from the time the lid or cover was first placed on the basin until the accident no inspection had been made of the cover or flange on which it rested.

Defendant produced in court, but did not offer in evidence, a catch basin cover which Harmon identified as being the cover in question. Plaintiff testified that such cover so produced was not the cover in question and we must assume her testimony to be true.

The foregoing in substance is all of the material testimony other than the evidence on injuries.

The only question presented is whether or not the trial court erred in entering the judgment notwithstanding the verdict.

In passing on a motion for the entry of a judgment notwithstanding the verdict the rule applicable on motions for a directed verdict must be applied. The evidence must be considered in its aspect most favorable to the plaintiff, together with all reasonable inferences therefrom. The evidence cannot be weighed but the court is required to assume that the evidence favorable to the plaintiff is true. All contradictory or explanatory circumstances must be rejected. The only inquiry is whether there is any evidence fairly tending to prove the plaintiff’s complaint. (McNeill v. Harrison & Sons, Inc., 286 Ill. App. 120; Hunter v. Troup, 315 Ill. 293; Sherwin v. City of Aurora, 257 Ill. 458.)

Applying the foregoing rules of law, if there was any evidence fairly tending to prove (1) that the plaintiff was injured; (2) that at and immediately prior to receiving such injury she was in the exercise of reasonable care for her own safety; and (3) that she was so injured through the negligence of the defendant as charged, then the trial court erred in entering such judgment regardless of the weight of the evidence.

There can be no question but what the evidence fairly tends to prove that the plaintiff received substantial injuries.

In our opinion the evidence fairly tends to show that the plaintiff was in the exercise of due care for her own safety at and immediately prior to the time of receiving such injuries. She had the right to assume that the sidewalk was in a reasonably safe condition for travel, and it cannot be said as a matter of law that she was absolutely bound to keep her eyes fixed upon the sidewalk in search of defects and dangerous places. (City of Chicago v. Babcock, 143 Ill. 358.)

Assuming the testimony most favorable to the plaintiff to be true, as we are required to, such evidence, taken in its aspect most favorable to the plaintiff, fairly tends to prove that the cover over the basin had become thin and uneven around its edge from wear and use, and that an accumulation of rust and corrosion, due to moisture and other climatic and natural conditions, had formed and collected underneath the cover so as to fill the flange. The filling-in around the flange with such rust and corrosion, coupled with the thinness of the cover, could warrant the jury in finding that such condition had the effect of raising the cover from a firm position on the flange to a loose or unstable one, causing the cover to tilt when stepped upon as was done by the plaintiff in this case. In our opinion the evidence fairly tended to show that such cover as a part of the sidewalk was not in a reasonably safe condition for the use of the traveling public, but was in a dangerous and unsafe condition as charged in the complaint.

It was the duty of the defendant city to use reasonable care to keep the sidewalk in question in a reasonably safe condition for the use of the traveling public. (Graham v. City of Chicago, 346 Ill. 638.) Before the defendant could be held liable it must appear that it had actual or constructive notice of the alleged unsafe condition (Boender v. City of Harvey, 251 Ill. 228), but notice could he imputed if such condition existed for such a length of time that the public authorities by the exercise of reasonable care and diligence might have known of such condition. (Powell v. Village of Bowen, 92 Ill. App. 453.) Generally it is a question of fact for the jury whether a city has had notice of a defect. (Boender v. City of Harvey, supra.) In Sherwin v. City of Aurora, supra, the question arose whether a city was under obligation. to inspect the supporting structure underneath a sidewalk and whether it was bound to take notice of defects not apparent from the surface of the sidewalk. The court held that the city was bound to take notice of the method of construction and surrounding conditions and went on to say: “It is the duty of municipal officers to use ordinary care in keeping its bridges, culverts, etc., in a safe condition for public travel, and this involves the anticipation of defects that are the natural and ordinary result of use and climate influences ; and so, wherever there is neglect on the part of the proper officer to make a sufficiently frequent examination of a particular structure, a municipality will not be relieved from liability although the defect may not be open and notorious.” We believe this rule of law is applicable to the facts in this case.

It is not claimed the defendant had actual notice of the condition in question. Defendant contends that the city can not be charged with constructive notice because there is no proof that such condition existed for any length of time whatever. It is true no witness testified that the condition of the cover and rim of the catch basin as described by plaintiff had existed for any length of time prior to the accident. The testimony most favorable to the plaintiff shows, however, that the flange was “filled with rust and corrosion,” and that the lower edge of the cover was worn off “as thin as a piece of cardboard.” Defendant’s superintendent of streets testified that there was “a very little” rust on the bottom of the cover when it was installed and “a good deal” of rust on it at the time of the trial, “the result of moisture in the catch basin.” It is a matter of common knowledge that iron will often rust and corrode when exposed to water and weather and that such rust and corrosion do not generally occur to any considerable extent or degree in a short period of time. It could reasonably be inferred by the jury that the condition in which the flange and cover was shown to be at the time of the accident was not created in a short period of time, but gradually came ábout over a considerable period of time, and it could be reasonably inferred by the jury that the presence of such rust and corrosion and the worn condition of the cover might have been discovered and remedied on ¡reasonable inspection. What was reasonable inspection was a question of fact for the jury.

It is undisputed that the flange had been installed for some unknown period of time prior to the time when the cover was installed, and the record is silent as to whether the flange was free from rust and corrosion at the time the cover was installed. It is admitted that no inspection was made of the cover from the time it was first installed until after the accident, the time of installation appearing to be, at least six months before the accident.

The rule of law applicable to such a situation is laid down in City of Ottawa v. Hayne, 114 Ill. App. 21, where the court said: “The law fixes no exact limit as to what is a sufficient time for an obstruction or defect to exist in order to charge a city with implied notice. In this respect each case must be determined from all the surrounding circumstances. It is a question of fact for the jury to determine in view of all the facts and circumstances. City of Decatur v. Besten, 169 Ill. 340.” (Also see City of Savanna v. Trusty, 98 Ill. App. 277.) In our opinion it was peculiarly within the province of the jury to determine whether or not the alleged defective conditions were of such a character and had existed for such a length of time that the defendant might have discovered and remedied them, and to determine whether or not the defendant was negligent in this respect. (See Chicago & Western Suburban Exp. Co. v. City of Berwyn, 174 Ill. App. 543.

For the reasons indicated it is our opinion that the trial court erred in granting the motion of the defendant for a judgment notwithstanding the verdict and in entering judgment in favor of the defendant.

The judgment of the city court is therefore reversed and the cause is remanded to such court with directions to overrule the motion of the defendant for a judgment in favor of the defendant notwithstanding the verdict, and to pass upon the motion for a new trial, if one shall be made by defendant, and if such motion for new trial is overruled, or if such motion for a new trial is not made, to enter judgment on the verdict in favor of the plaintiff.

Reversed and remanded with directions.


author: Mr. Justice O’Connor

text:
    Otto C. Woerter, Receiver of Humboldt State Bank, Appellee, v. Abraham David and Fannie David. Abraham David, Appellant.
    Gen. No. 41,720.
    Heard in the first division of this court for the first district at the June term, 1941.
    Opinion filed November 10, 1941.
    Martin M. Gross, of Chicago, for appellant.
    Herbert G. Immenhausen, of Chicago, for appellee; Peter R. Scalise and Edward C. Brizzolara, both of Chicago, of counsel.
   Mr. Justice O’Connor

delivered the opinion of the court.

August 20,1940, plaintiff’s predecessor caused judgment by confession to be entered against Abraham David and Fannie David for $776.30. The basis of the action was a promissory note executed by the two defendants May 12, 1931, for $430, payable six months after date to the Humboldt State Bank at “2722 North Avenue, Chicago,” with interest at 7% per annum after maturity. The judgment included the face of the note, $430, interest, $246.30 and $100 attorney’s fees. Execution issued on the judgment and was served on the two defendants by the bailiff of the Municipal court August 29, 1940. Seven days thereafter — September 4, 1940, defendant, Abraham David filed his motion to vacate or open the judgment and for leave to defend. The basis of the motion was an affidavit by him that he had gone through bankruptcy and had been discharged by the United States District Court for the Northern District of Illinois, Eastern Division, June 28, 1937, and the order of discharge was set up verbatim and made a part of the affidavit. In the -order it is recited that Abraham David had been duly adjudged a bankrupt under the acts of Congress; that he appeared to have conformed to all the requirements of the law relating to bankruptcy and it was ordered that he be “discharged from all debts and claims which are made provable by said acts . . . and which existed on the 28th of January, 1937, on which day the petition for adjudication was filed by him, excepting such debts as are by law exempted from the operation of a discharge in bankruptcy.”

Plaintiff filed a verified answer to defendant’s motion in which it was alleged that plaintiff’s indebtedness was not properly scheduled, in that it did not give the address of the payee of the note, the Humboldt State Bank, but stated the residence of the bank was “unknown”; that at the date of the filing of the petition in the bankruptcy proceeding by defendant and the date of the entry of the order of discharge, the bank was in the hands of a receiver who maintained a representative at “2722-24 West North Avenue, Chicago” in the bank building where defendant borrowed the money from the bank and executed the note; that defendant well knew, or by the exercise of reasonable diligence should have been able to ascertain, the address of the plaintiff creditor; that the creditor did not receive any notice of the bankruptcy proceeding and had no knowledge of it until September 3, 1940. The conclusion was that the claim was not affected by the order of discharge entered by the bankruptcy court.

Plaintiff attached to and made a part of his answer a copy of the schedule filed by defendant in the bankruptcy proceeding. The court entered an order giving defendant leave to appear and defend, the judgment to stand as security. Afterward an order was entered giving defendant leave to file interrogatories and November 18, 1940, they were filed and plaintiff ruled to answer certain of them but whether answers were filed does not appear from the record. January 13, 1941, the case was heard before the court without a jury, the court found in favor of plaintiff, confirmed the judgment against defendant, Abraham David, and he prosecutes this appeal.

The record discloses that the note in suit was executed May 12, 1931, and two days thereafter the bank closed. Sometime following a receiver was appointed. January 28, 1937, defendant Abraham David, filed his petition in bankruptcy and the order of discharge was entered by the bankruptcy court June 28, 1937. It was not until more than three years thereafter, viz., August 20, 1940, that the instant case was brought.

On the hearing little evidence was introduced but there was a sort of running metaphysical argument between court and counsel as to the law, particularly whether the burden of proof was on plaintiff in the first instance and thereafter shifted to defendant or whether after plaintiff had made out a prima facie case defendant was required to go forward with evidence, etc., and whether defendant was required to introduce in evidence a certified copy of the order discharging him by the bankruptcy court, most of which, we think on the record before us, was merely academic and only tended to confuse the issue. We think the same is true of the discussion in the briefs as to the state of the pleadings because the facts are clearly shown and are undisputed.

The record discloses that defendant in support of his motion to open up the judgment and for leave to defend, set up verbatim a certified copy of the order of discharge.' Plaintiff in his answer to the motion made no denial of this allegation and on the hearing his counsel stipulated that the order of discharge had been entered; that the claim had been scheduled in the bankruptcy proceeding giving the address of the bank as “unknown.” The court held this was insufficient because it deprived the creditor of his right to file a claim or objection to the discharge. It was also stipulated that no dividends were paid in the bankruptcy proceeding.

On the hearing it further appeared that counsel for defendant cálled a witness to testify as to what was done by defendant to ascertain the address of the bank and there was considerable argument by counsel for defendant that the burden of proof on this question was on plaintiff. But finally the case was disposed of on the ground that the address of the bank was not given, and therefore the proffered testimony would be immaterial and inadmissible. We think the court should have permitted defendant to show what he did in endeavoring to get the correct address of the bank before the bankruptcy proceeding was instituted. The bank had been closed in 1931 and the bankruptcy proceeding was not instituted until 1937. The burden on the point was on defendant, Smith v. Hill, 232 Mass. 188, affirmed Hill v. Smith, 260 U. S. 592.

The order of discharge entered by the bankruptcy court having been shown, this was prima facie proof of defendant’s discharge and the burden of proof was on plaintiff to show that the claim sued upon was not within the terms of the bankruptcy act. Van Norman v. Young, 228 Ill. 425; Smith v. Hill, 232 Mass. 188; Kreitlein v. Ferger, 238 U. S. 21. The burden of proof was on defendant to show that he used due diligence to ascertain the address of the bank prior to the time he instituted the proceeding in the bankruptcy court, 8 C. J. S., sec. 577, pp. 1536-7, or that plaintiff had notice or knowledge of such proceeding in time to file his claim.

For the reason that defendant was not permitted to prove what he did to ascertain the correct address of the bank, the judgment of the Municipal court of Chicago is reversed and the cause remanded.

Reversed and remanded.

McSurely, P. J., and Matchett, J., concur.


text:
    Joseph Beasley, Appellant, v. Arthur Morris, Appellee.
    Gen. No. 41,770.

      Heard in the first division of this court for the first district at the June term, 1941.
    Opinion filed November 10, 1941.
    Richard A. Harewood, of Chicago, for appellant.
    No appearance for appellee.
   Mr. Justice O’Connor

delivered the opinion of the court.

Plaintiff brought an action of detinue against defendant to recover possession of two insurance policies and deeds to certain burial lots in Lincoln Cemetery. Afterward the statement of claim was amended so as to eliminate any claims to the deeds. Defendant admitted he held the two insurance policies but claimed he had paid premiums on the policies at plaintiff’s request amounting to $156 which plaintiff had often promised to pay but had failed to do so. He also claimed $75 from plaintiff for room and board and claimed recoupment for the $156 and he filed a counterclaim for the $75.

October 15, 1940, there was a trial before the court without a jury, a finding against defendant on the counterclaim and in favor of plaintiff on his claim for the policies the court finding defendant was unlawfully detaining the two insurance policies. Judgment was entered accordingly. Nine days thereafter, viz., October 24, 1940, defendant filed with the clerk of the Municipal court a motion to vacate the judgment and for a new trial, setting np six different grounds, such as, the judgment is contrary to the law and the evidence, etc., none of which throws any light' on the subject.

Afterward there were orders and petitions to have defendant show cause why he should not be adjudged in contempt of court for failure to turn over the two insurance policies. Thereafter an affidavit was filed by defendant asking that the rule be discharged, the judgment vacated and a new trial granted. Afterward various orders were entered continuing the matter and on February 5, 1941, the court entered the following order: “This cause coming on for hearing upon motion of the defendant heretofore entered herein to vacate the judgment of October 15th, 1940 and the Court being fully advised in the premises sustains said motion and cause reinstated.” While the order is rather badly drawn the effect of' it is to vacate the judgment and award a new trial. Thereafter plaintiff filed a notice of appeal in the trial court, various motions were filed and the record was brought to this court April 18, 1941. Plaintiff has filed his brief but defendant has entered no appearance.

Counsel for plaintiff says “Merely filing with the clerk of the trial Court a motion in writing for a new trial and during the term at which judgment was entered, without calling the attention of the Court or of opposing counsel to said motion, is insufficient and does not constitute making a motion for a new trial.” In support of this the case of Morse Co. v. Eaton, 91 Ill. App. 411, and other cases are cited. We think the contention cannot be sustained because the record discloses the case was heard and judgment entered October 15, 1940. Nine days thereafter, October 24, defendant filed a written motion to vacate the judgment and for a new trial. And the affidavit of counsel for defendant filed December 29, 1940, sets up that on October 30, 1940, pursuant to notice given the day before, counsel for defendant called up Ms motion to vacate the judgment and for a new trial and asked that it be set for hearing; that at that time, October 30, plaintiff’s counsel appeared before the trial judge in response to defendant’s motion and opposed the motion that a time be set for hearing defendant’s motion for a new trial on the ground that it was filed in the office .of the clerk instead of in open court and that the trial court refused to set the motion for a new trial on that ground. If the court took this view it was error. The facts in the instant case are not analogous to the facts in the case of Morse Co. v. Eaton.

In the instant case, the motion to vacate and for a new trial was made nine days after the judgment was entered and was brought to the attention of the court within 30 days after the judgment was entered. Moreover, we think this was the view taken by the trial court because.the effect of the order of February 5, 1941, was to vacate the judgment and to award a new trial, from which an appeal is not warranted unless allowed by this court. Paragraph 201, § 77, ch. 110, Ill. Rev. Stat. 1941 [Jones Ill. Stats. Ann. 104.077.]. Where an appeal is taken from an order awarding a new trial, no notice of appeal is required. Supreme Court Rule 30, Rule 20 of this court.

In the instant case since no attempt was made to follow the provisions of the statute and the rules of court, the record is improperly before us and the appeal is dismissed.

Appeal dismissed.

McSurely, P. J., and Matchett, J., concur.


author: Opinion by Justice Culbertson.

text:
    Mrs. Adolph Heicke, Assignee of Dave Danzinger, Trading as Central Commission Company, in City and State of New York, Appellee, v. Bank of Mansfield of Mansfield, Missouri, Appellant.
    Heard in this court at May term, 1941;
    opinion filed October 27, 1941.
    McGlynn & McGlynn, for appellant; John J. Hoban, of counsel; Robertson & Conley and W. E. Knowles, for appellee.
   Opinion by Justice Culbertson.

“Not to be published in full.’’


author: Opinion by Justice O’Connor.

text:
    Peter Kutrzeba, Appellant, v. John Solewski, Appellee.
    Gen. No. 41,687.

      Heard in first division, first district, this court at April term, 1941;
    opinion filed November 10, 1941.
    Stanley S. Piotrowski, for appellant; Edward L. Kowalski, of counsel; George M. Tearney, for appellee.
   Opinion by Justice O’Connor.

“Not to be published in full.”


text:
    Home Insurance Company, Appellee, v. Yellow Cab Company, Appellant.
    Gen. No. 41,729.
    Heard in first division, first district, this court at June term, 1941;
    opinion filed November 10, 1941.
    Benjamin Samuels, for appellant; J. C. McKenzie, of counsel; Lawrence S. Adler, for appellee.
   Opinion by Justice O’Connor.

“Not to be published in full.”


author: Mr. Presiding Justice Stone

text:
    Carl F. Meyer, Appellee, v. B. L. Hendrix, Appellant.
    Heard in this court at the February term, 1941.
    Opinion filed October 27, 1941.
    Rehearing denied November 27, 1941.
    Wilbourn & Twente and Donald A. Miller, all of Cairo, for appellant.
    G. Gale Roberson, of Chicago, and Dewey & Cummins, of Cairo, for appellee.
   Mr. Presiding Justice Stone

delivered the opinion of the court.

On July 28, 1938, a judgment in this case was entered by confession by the circuit court of Pulaski county, in favor of Carl F. Meyer, appellee (hereinafter designated as plaintiff) and against B. L. Hendrix, appellant (hereinafter designated as defendant) in the sum of $2,467.38 and costs. This represented a balanee of principal in the sum of $1,524.60, plus interest and attorney’s fees remaining unpaid on a certain promissory note in the principal amount of $6,000 dated November 12, 1926, signed by defendant, and payable to the order of Agnes E. Meyer, guardian for Carl F. Meyer, plaintiff. Agnes E. Meyer was the mother of plaintiff and sometime prior to the entry of the judgment had endorsed the note to plaintiff.

On September 19, 1938, defendant filed his petition in the lower court for leave to appear and defend, and pursuant to stipulation between the parties, the court opened up the judgment, gave defendant leave to appear and defend and allow defendant’s petition to stand as an answer to the complaint. Defendant in his answer alleged want of consideration, fraud in obtaining the signature of defendant, in that the original payee, Agnes E. Meyer fraudulently represented that there was due a balance of $6,000 upon a previous obligation between the parties, and overpayment in the sum of $6,841.03. The case was tried by the court without a jury, upon complaint and answer. The issues were found for the plaintiff and the judgment entered by confession on July 28, 1938 was confirmed, from which judgment defendant prosecutes his appeal to this court.

Of the eight errors relied upon for reversal by defendant, only two are argued in his brief. It is a well-established rule of law that alleged errors which have been assigned but not argued- by an appellant are deemed to have been waived and abandoned. People v. Mahoney, 361 Ill. 202; People v. Reilly, 348 Ill. 153; People v. Cobb, 343 Ill. 78; Harned v. Tippett, 302 Ill. App. 258; Starr v. Rossin, 302 Ill. App. 325. Of the two assignments of error which ivere argued, one was that the trial court erred in not finding that by failing to reply to defendant’s affirmative defense of fraud and payment of the original indebtedness, plaintiff admitted said defense and therefore, the same was a compíete bar to plaintiff’s suit, and by reason thereof the court erred in not rendering judgment against plaintiff.

The issues were presented to the court on complaint and answer. Affirmatively the defense of want of consideration and fraud, and overpayment were set up as new matter ih the answer and no reply thereto filed. During the course of the trial some objection was made to the introduction of certain evidence, as not conforming to the pleading. But in spite of this, defendant presented evidence in support of his answer, particularly on the questions of want of consideration and overpayment. We find no evidence of fraud in the record. By his active participation in the trial and to its conclusion, we are of the opinion defendant waived the filing of a reply. Jones v. Neely, 72 Ill. 449; Marpie v. Scott, 41 Ill. 50; Robinson v. Miller, 317 Ill. 501; Keightley v. Glass, 275 Ill. 149; Guerin v. Guerin, 270 Ill. 239; Riot v. Davis, 241 Ill. 434; Watt v. Cecil, 368 Ill. 510; Engelking v. Springfield Brewing Co., 299 Ill. App. 626 (Abst.).

In the recent case of Engelking v. Springfield Brewing Co., supra, where this question was raised, the court said: “The appellant further contends that because no reply was filed to the answer the defenses of want of consideration, lack of authority of the husband of the appellee, as a corporation officer, to execute the note, and the satisfaction of the debt between the husband and appellant corporation must be deemed to be admitted. Under the Civil Practice Act of Illinois, Ill. Rev. Stat. 1937, ch. 110, sec. 164 [Jones Ill. Stats. Ann. 104.040], it is provided: ‘(2) Every allegation, except allegations of damages, not explicitly denied shall be deemed to be admitted, unless the party shall state in his pleading that he has no knowledge thereof sufficient to form a belief, and shall attach an affidavit of the truth of such statement of want of knowledge, or unless the party has had no opportunity to deny.’

“Under the old Chancery Act it was held that when no replication was filed and the cause was tried upon bill and answer, an affirmative defense set up in the answer must be taken as true where no testimony was taken on that issue. Watt v. Cecil, 368 Ill. 510. In Ogent v. Beasley, 284 Ill. App. 363, where the Plaintiff was ordered to file replication to the answer and he failed to do so and went to trial on bill and answer the same rule was announced. It is a familiar rule that pleadings shall be liberally construed with a view to doing substantial justice between the parties. In the present case testimony was taken on the issues raised by the affirmative defenses in the answer, both by way of stipulation as well as by oral and documentary proof. We believe, therefore, that the strict rule of admitting the subject matter of the affirmative defenses in the answer should not be applied in this case.”

The other assignment of error argued by defendant is that the finding of the court was contrary to the manifest weight of the evidence. It appears that the business relations of defendant and the original payee under the note began in 1917 and the note upon which suit was brought was given in compromise of an alleged balance due from previous transactions.

One of the issues of fact involved the question of whether a sum of $8,000 advanced defendant in 1917 by Rev. Francis J. Tecklenburg, who had secured said sum from Agnes E. Meyer, was a loan or an investment in a new business enterprise, which defendant organized at that time. It was the theory of defendant that the above sum represented a loan and that if all the payments made by defendant to Rev. Tecklenburg and Mrs. Meyer since 1917 were to be credited against this amount, the result would show a payment in full of the $8,000 plus accrued interest thereon and an overpayment of $6,841.03.

Another issue of fact was whether defendant had entered into a settlement on or about June 26, 1924 with Agnes E. Meyer and Rev. Tecklenburg whereby the claims of Mrs. Meyer and Rev. Tecklenburg against defendant to participate in the profits of the Hendrix Mill and Lumber Co., operated by defendant, were settled and compromised. The testimony of Rev. Tecklenburg and defendant Hendrix are in more or less direct conflict on these propositions. As stated previously we find no evidence of fraud in the record, on the part of Mrs. Meyer in procuring defendant’s signature to the note sued upon. It will serve no useful purpose to discuss this evidence in detail. These controverted questions were primarily questions of fact for the trial judge, sitting as a trier of fact, in the absence of a jury. The finding of the trial court on the controverted facts is entitled to the same weight as the verdict of a jury. Moore v. David J. Molloy Co., 222 Ill. App. 295. The judgment of that court who saw the witnesses and heard them testify is conclusive on all questions of fact, if not manifestly against the weight of the evidence. Paterson v. Whitney, 67 Ill. App. 290; Shapleigh Hardware Co. v. Enterprise Foundry Co., 305 Ill. App. 180, 27 N. E. (2d) 1012. We do not believe that the finding of the court in this case was contrary to the manifest weight of the evidence. Finding no reversible error, the judgment of the lower court will be affirmed.

Affirmed.


author: Mr. Justice Culbertson

text:
    Tri-City Transportation Company, Inc., and I. J. Hudson, Jr., Appellees, v. Bituminous Casualty Corporation, Appellant.

      Heard in this court at the May term, 1941.
    Opinion filed October 27, 1941.
    Rehearing denied November 27, 1941.
    Dewey & Cummins, of Cairo, and W. C. Ropiequet, of East St. Louis, for appellant.
    Joseph O’Sullivan, of Mound City, and Chas. L. Rice, of Cairo, for appellees.
   Mr. Justice Culbertson

delivered the opinion of the court.

This is an appeal from a decree of the circuit court of Pulaski county, Illinois, ordering that a policy of workmen’s compensation insurance entered into between Tri-City Transportation Company, Inc., one of the appellees (hereinafter called the plaintiff Company), and Bituminous Casualty Corporation (hereinafter called defendant), be reformed so that the name of I. J. Hudson, Jr. (hereinafter called plaintiff Hudson), be included in the policy as an assured, and that the terms of the policy include the employees of said I. J. Hudson, Jr. The decree of court specifically found from the evidence that the proof failed to show a mutual mistake of both plaintiffs and defendant in the execution of the policy of insurance, as charged in the complaint, hut found that the defendant “by reason of its conduct” was estopped to deny the alleged mutual mistake of the parties in connection with the terms of the policy.

The complaint filed in the circuit court sought to have the insurance policy reformed and corrected so as to make it payable to both the plaintiff Hudson and the plaintiff Company (of which Hudson was the controlling stockowner). Hudson was engaged in business in his individual capacity, operating a restaurant and novelty business as an individual, in the headquarters of the Transportation Company, which was engaged in the bus business. It was alleged in the complaint that both plaintiffs had applied for the policy of insurance, and that plaintiff Hudson discovered that the policy did not cover him, but only his corporation, after the issuance of the policy, and that the insurer thereafter sent him a certain rider to be attached to the policy, but that through a mutual mistake of the parties, the rider did not conform to the intention of the parties in that it failed to make Hudson, individually, an assured by its terms. The insurer denied that Hudson had ever applied for insurance, or that any policy had ever been issued to him. The policy is in the name of the Transportation Company alone, as assured, and makes no mention of Hudson.

Hudson, who was president and general manager of the plaintiff Company, which was engaged in the transportation business, went into the restaurant business in 1936, as an individual, and certain of his employees were, likewise, employees of the corporation. The Transportation Company was covered by insurance in the defendant Casualty Corporation in three successive policies. An insurance broker of Cairo, Illinois, who testified in behalf of the plaintiffs, stated that he had procured the insurance at the request of Hudson. There was evidence that a rider was attached to the policy, which did cover restaurant employees, but in such policy they are stated to be employees of the Transportation Company. An additional premium was paid for such coverage. It was shown that the plaintiff Hudson had started the restaurant business as a personal operation and that it was not a corporate ' enterprise. There was testimony by both Hudson and the broker, who had formerly been employed by Hudson, that it was the intention of the parties that the restaurant employees be covered by such policy. The evidence shows that the broker was licensed as both an agent and an insurance broker by the insurance department of the State of Illinois, but in his testimony he indicated that he had never acted as agent for the defendant Corporation, and that the workmen’s compensation insurance involved was placed with the defendant Corporation by such broker in his capacity as broker and under his broker’s license, through a duly authorized general agent for the defendant insurer. The applications for such insurance were sent to the General agent by mail, from the broker in Cairo. There was evidence to the effect that two small losses had been paid by the insurer under the policy on the basis of accident reports tending to show that such employees so injured were employees of the corporation. The insurer paid such claims on the basis of such reports.

It was contended by the plaintiff Hudson that such employees were, likewise, employed by him in his individual capacity. There was no showing of any notice to defendant insurer of any such employment either at the time the claims were made, or at any other time.

It is also shown that a safety engineer of the defendant insurer had inspected the-premises occupied by the plaintiff Transportation Company and the plaintiff Hudson, and that the records and checks of the plaintiff Transportation Company and plaintiff Hudson had been audited by an employee of the defendant Insurance Company. Two sets of records were kept at the office, one by the title of plaintiff Hudson, and the other, the plaintiff Transportation Company. There was testimony by the broker in Cairo and the plaintiff Hudson to the effect that it was the intention of the parties to cover the restaurant and other employees of Hudson individually. On May 26, 1939, an employee of plaintiff Hudson individually, sustained a fatal accidental injury. The defendant Corporation investigated such claim, and upon determining that the fatal injury occurred while such employee was working for Hudson individually, defendant Corporation denied that such employee was covered by the terms of the policy with the plaintiff Transportation Company.

The case was tried by the court, without a jury, and resulted in the decree referred to at the outset of this opinion. The defendant Insurance Company bases its appeal on three principal contentions: (First) That the decree of the lower court, predicated upon the finding of estoppel against the insurer, did not correspond to and had no basis in the theory of the complaint; that on the contrary, the finding of the court that the proof failed to show a mutual mistake of the parties as alleged, negatived the entire theory of the complaint, and that, therefore, the court erred in denying the motion of the insurer to enter judgment for the insurer at the conclusion of plaintiffs’ case on the ground that the evidence failed to support the complaint. (Second) That the court erred in admitting, over appropriate objection, testimony concerning conversations between plaintiff Hudson and the insurance broker, on the ground that the latter was the agent of the assured, and not of the insurer; and (Third) That the finding of the court' that the insurer, by reason of its actions, was estopped to deny the alleged mutual mistake of the parties, is contrary to the preponderance of the evidence, and wholly unsupported by any competent evidence.

While no showing was made to justify such conclusion in the instant case there is no dispute about the basic power of a court of equity to reform or correct a written instrument or contract where there is an omission contrary to the intention of the parties, or a mistake has been made in the name of the insured, or in the description of the property (German Fire Ins. Co. v. Gueck, 130 Ill. 345; Home Insurance & Banking Co. of Texas v. Myer, 93 Ill. 271).

As to the status of the broker, it is contended by the plaintiffs that such broker had acted as agent of the defendant insurer. It is established that whether a party acts as a broker or agent is not determined by what such party is called, but is to be determined from what he does — that is, that his acts determine whether he is an agent or a broker. The broker who testified in this case, stated that he was not an agent of the insurer and never had been, and the evidence discloses that he did nothing more than solicit the plaintiffs for their insurance business; that he was requested to place the workmen’s compensation insurance for the Transportation Company with the Bituminous Casualty Corporation. He stated that he could have placed it with some other company if he had desired, and that at the time of the issuance of the policy he had a broker’s license with the Bituminous Casualty Corporation, but no agency license. Under chapter 73, section 588, 1939 Ill. Rev. Stat. [Jones Ill. Stats. Ann. 66.125(2)], the term “broker” as used in the act is stated to mean any person, etc. who acts in the solicitation or negotiation “on behalf of the assured” of insurance contracts. Under the circumstances, the introduction of a conversation between plaintiff Hudson, and his insurance broker, could hardly operate to bind the defendant insurer in absence of some showing of agency or ratification, or in absence of some basis for an estoppel as to the defendant insurer.

Irrespective of whether or not an estoppel would be required to be pleaded under the facts and circumstances in this case, the evidence before the court, in our judgment, does not justify the finding of the trial court that the insurer was estopped from denying that there had been a mutual mistake of the parties in the issuance of the policy of insurance. It is fundamental that before a party can claim benefit of an estoppel, there must have been conduct on the part of the one claiming to have been estopped, which was calculated to mislead, and it must have been relied upon to the detriment of the person claiming the benefit of it, and such party must have been in ignorance of the true facts and devoid of convenient means of ascertaining the real situation. In this case an estoppel is urged against one who was ignorant of the facts. Under such circumstances, the doctrine of estoppel cannot be invoked as against the defendant (Fitzpatrick v. Pitcairn, 371 Ill. 203, 210, 211; Morse v. Illinois Power & Light Corp., 294 Ill. App. 498; Alton Banking & Trust Co. v. Alton Building & Loan Ass’n, 289 Ill. App. 177).

The only acts which could conceivably have been invoked to justify an estoppel would arise either from the actions of the broker, from acceptance of premiums, from payments of the claims of plaintiff Hudson’s employees, from the safety inspection by the insurer, or from the audit made by the insurer. As to the actions of the broker, there was nothing in evidence that tended to show any knowledge, consent, or ratification of anything which was done by the broker, nor, as we have indicated previously herein, was there any showing of agency on behalf of such broker. The fact that premiums were paid did not put the insurer on notice that Hudson, individually, was to be insured, in view of the fact that only one check was sent for the premium to the insurer. The fact that Hudson kept a private account as to such adjustment would not be binding upon the insurer who received payment from only one source. (The payment was actually made to the broker, and he remitted to the insurer, after deducting his commission.) The payments of claims on the previous accident reports were made on the basis of reports signed on behalf of the Tri-City Transportation Company and I. J. Hudson, Jr., doing business as Tri-City Transportation Company, both of which were signed by “I. J. Hudson, Jr., President.” One of such claims involved only a small medical payment of $2 and no attempt was made to investigate before payment was made. The fact that the safety engineer of the insurer had made inspections on the premises could not act as an estoppel in view of the fact that no showing was made that the safety engineer was informed that any part of the work done on the premises was for Hudson personally. There is, likewise, nothing in the fact that an audit was made by the insurer which put defendant insurer on notice that the policy was intended to cover the employees of Hudson personally, as well as the employees of the plaintiff Company. "As a matter of fact, the evidence tends to show that it would have been reasonable for the auditor to conclude, on the basis of the records, that there was but one employer and that this was the plaintiff Company.

The conclusion of the court below, and the finding which is a part of the decree herein, that there was no showing of a mutual mistake of plaintiffs and defendant in the execution of the policy of insurance, as charged in the complaint, in view of the allegations of the complaint and the testimony and evidence in the record, makes untenable the further conclusion that the insurer was estopped to deny that there had been a mutual mistake of the parties. Such conclusion we find as a fact is contrary to the manifest weight of the evidence and is unsupported by any substantial evidence in the record. In view of such conclusion it is unnecessary that we discuss certain other points raised by both plaintiffs and defendant.

The judgment and decree of the circuit court of Pulaski county will, therefore, be reversed, and judgment will be entered here in favor of the defendant, Bituminous Casualty Corporation, and against the plaintiffs for costs.

Reversed, and judgment entered here.


author: Mr. Presiding Justice Hayes

text:
    Vinton Suiter, Complainant, v. Clara Suiter et al., Defendants, John J. Suiter and Charles Louise Suiter, Appellants. W. E. Deming, Administrator De Bonis Non, Will Annexed of Estate of Charles Suiter, Deceased, Appellee, v. Clara Suiter et al., Cross Defendants, John J. Suiter and Charles Louise Suiter, Appellants.
    Gen. No. 9,216.

      Heard in this court at the October term, 1939.
    Opinion filed November 3, 1941.
    W. B. McBride and Provine & Williams, all of Taylorville, for appellants.
    Hershey & Bliss, of Taylorville, for appellee.
   Mr. Presiding Justice Hayes

delivered the opinion of the court.

Charles Suiter died testate on September 20, 1924. On September 20, 1929, Vinton Suiter, testator’s son, and one of his devisees, filed a bill in the circuit court of Christian county to partition certain real estate devised by the testator. W. E. Deming, administrator de bonis non, with will annexed, filed a cross bill asking that partition be denied, and that he be authorized to sell the real estate to pay the debts of the estate. The heirs and devisees of Charles Suiter, and certain of his creditors, were made defendants in both instances. The cause was referred to a master in chancery, who after hearing, filed findings of fact upon which the circuit court entered a decree finding that the personal assets of the estate were not sufficient to pay the just debts thereof, and that therefore the real estate of the testator should be sold as prayed in the cross bill.

John J. Suiter and Charles Louise Suiter, heirs and devisees of the testator and defendants to both the original bill and the cross bill, have appealed to this court to reverse the decree of the circuit court of Christian county.

Three issues are raised upon this appeal, first, whether by the terms of the last will and testament of Charles Suiter, his real estate is equally liable with his personal estate for the payment of his debts. Second, whether there is sufficient personal estate to pay testator’s debts, and third, if not, the amount of the deficiency.

The last will and testament of Charles Suiter provides in part as follows:

‘ ‘ First: I order and direct that My Executrix hereinafter named, pay all my just debts and funeral expenses as soon after my decease as conveniently may be done.
Secondly: After the payment of such funeral expenses and debts, I give, devise and bequeath to my wife, Clara Suiter, all her legal rights in my estate, whatsoever they may be.
Thirdly: I hereby direct that my Executrix hereinafter named shall keep my estate all together for the term of five years from date of my death the same to be held in trust and managed by her, and out of the income therefrom, after paying taxes, repairs and the necessary expenses of the management thereof, to pay the remainder of the income therefrom on any debts that I may owe at the time of my decease. The remainder of my estate after the payment of debts and funeral expenses and provisions herein made for my wife Clara Suiter, I give, devise and bequeath as follows: . . .” Then followed the proportions into which the residue was to be divided.

Testator’s wife, Clara Suiter, was named executrix and she acted as such until February 9, 1931, when she was removed, and the cross complainant named as administrator de bonis non, with will annexed.

Appellee contends that the provisions above quoted show an intention on the part of the testator to subject his real estate equally with his personalty to the payment of the debts of his estate. In this connection, he points out that the first paragraph directs the payment of all the testator’s just debts; that the devise to the widow in the second paragraph is prefaced by the phrase, “after the payment of such funeral expenses and debts,” and that the residuary clause in paragraph three is likewise preceded by the phrase, ‘‘ after the payment of debts and funeral expenses.”

We do not believe these provisions can be so construed. Under the statutes of this State Ill. Rev. Stat. 1937, ch. 3, par. 99 [Jones Ill. Stats. Ann. 110.099], the personal estate of a decedent is made primarily liable for the debts of a decedent, unless a contrary intention is expressly indicated or may he clearly implied from the provisions of the will. Sutherland v. Harrison, 86 Ill. 363; Baker v. Baker, 319 Ill. 320.

The first paragraph of the will of Charles Suiter is typical of that found in most wills, and does not indicate any intention on his part to depart from the statutory methods of satisfying the debts of his estate, nor do the phrases found in paragraphs two and three evidence that intent. As was said in Decker v. Decker, 121 Ill. 341, where a similar phrase was under construction: “We perceive nothing in the language relied on that warrants such a conclusion. The fact that the dispositions of the will, including both realty and personalty, are preceded by the formula, ‘after the payment of funeral expenses and just debts, I give,’ etc., indicates no purpose on the part of the testator to specially charge his realty with such debts and expenses. The manifest intention of the testator in using the language in question was, to make all the bequests of the will, whether of personalty or realty, subject to the payment of his debts, leaving it to the law to determine the order in which the real and personal assets should be liable.” See also Harris v. Douglas,64 Ill. 466.

Appellee also contends that because Charles Suiter devised both realty and personalty en masse in his residuary clause, he intended to subject them equally to the payment of his debts. The cases cited however, do not support this position. In Baker v. Baker, supra, the Supreme Court held that where a testator makes specific devises of real estate and of personalty, the realty must share ratably with the personalty in the payment of debts. In Williams v. Williams, 189 Ill. 500, where both realty and personalty were devised en masse by residuary clause, the Supreme Court affirmed a decree subjecting the real estate to the payment of general legacies, only if the personalty was proved to be insufficient to pay them. In Reid v. Corrigan, 143 Ill. 402, it was held that where a testator expressly disposed of all his personalty in the first paragraph of his will, a residuary devise of real estate was subject to the paymént of a pecuniary legacy made in the second paragraph of the will. None of these cases establish the rule that the inclusion by a testator of both realty and personalty en masse in a residuary clause, is evidence that he intended both to be equally liable for the payment of his debts.

Except for the provision in paragraph three, creating a trust for five years, the income from which was to be used to pay debts, no authority is given the executrix by the will of Charles Suiter to depart from the statutory method of paying the debts of his estate. The real estate devised by the residuary clause is.subject to his debts only to the extent that there is insufficient personalty to satisfy them.

As to the second and third issues in this case, appellee contends that they have become res judicata, because of the decision of the Supreme Court in Suiter v. Suiter, 323 Ill. 519. In that case, Charles Suiter’s widow, as executrix of his estate, filed suit in the circuit court of Christian county for the construction of her husband’s will, for confirmation of her appointment as testamentary trustee and for partition. Answers were filed by all interested parties, one of which alleged that the widow was unfit to manage the estate as trustee and asked the appointment of a new trustee. The Supreme Court found no evidence of incompetency and decided that under the terms of the will, the widow was entitled to dower in the real estate but should receive none of the personalty. In concluding its opinion the court said: “The court erred in holding that the widow was entitled to one-third of the personal property, but this error is immaterial. The debts of the estate exceed the amount of personal property, so there will be no personal estate to distribute.” The part of this decision relevant here, merely establishes however that at the time of Charles Suiter’s death, there was insufficient personalty to satisfy his debts, and that up to the time of the decree, there was no proof that the widow was improperly managing the property.

Pursuant to the terms of Charles Suiter’s will, his property was held in trust for five years, for the purpose of paying his debts from the net income therefrom. It appears from the record that substantial sums have been received by the trustee, and that there have been sizeable expenditures in managing the estate. It further appears that two claims against the estate, amounting to over forty-eight hundred ($4,800) dollars have been satisfied by novation. The condition of the record is such, however, that we are unable to trace the various receipts and expenditures or determine whether all the expenditures were reasonable or necessary to the management of the estate. The case must therefore be remanded for further proof of these matters.

For thé reasons stated above, the decree of the circuit court of Christian county is reversed, and the cause remanded to that court for further proof and decision, in accordance with the views set forth in this opinion.

Reversed and remanded.


text:
    Mary E. Stone et al., Appellees, v. Tri-State Mutual Life Association, Appellant.
    Gen. No. 9,254.

      Heard in this court at the October term, 1940.
    Opinion filed November 3, 1941.
    T. Mac Downing, of Macomb, and Samuel Naylor and Samuel J. Naylor, both of Carthage, for appellant.
    Ira J. O’Harra and Roswell B. O’Harra, both of Macomb, for appellees.
   Mr. Presiding Justice Hayes

delivered the opinion of the court.

This is a suit at law, to recover on a benefit certificate, issued by Tri-State Mutual Life Association, defendant appellant (hereinafter called defendant) to Minnie M. Whitesell, insuring her in the amount of fifteen hundred ($1,500) dollars, — with Mary E. Stone, Josephine Roundey and Dena Whitesell, plaintiffs appellees (hereinafter called plaintiffs) beneficiaries.

The first count in the complaint alleged that the benefit certificate was in full force and effect at the date of the death of the insured, and that she had kept, performed, and complied with all the terms, provisions and conditions of said certificate, and of the provisions of the constitution and by-laws of the Association.

The second count averred that the secretary of the local was the authorized agent of the defendant to collect the dues and assessments; that for sometime prior to the death of the insured, she had an arrangement whereby the secretary would present the receipt for dues and assessments owing by said insured to the Union National Bank at Macomb; that said bank would pay the same to the secretary, and that prior to May 1, 1938, all dues had been paid up to July 1, 1938. Said count two further averred that prior to May 1, 1938, defendant had adopted a “new” constitution and by-laws, and that section 60 of article 1, of the same provided: “Prom and after the first day of May, A. D. 1938, all members in good standing at that time shall be required to pay a premium for insurance benefits, upon the annual renewable term rate based on the American Experience Table of Mortality, with interest at three and one-half per cent (3½%) per annum, unless and until the member has transferred his present certificate or policy of insurance, as provided in Section 61.” It is further alleged in the second count that neither the secretary of the local, nor anyone on behalf of the defendant, presented any premium receipt for premium payable under section 60 to the said bank, nor notified said bank or the insured that any premium was due May 1,1938. It further alleged that defendant had knowledge of the arrangement in collecting the assessments by said local secretary.

On January 28, 1939, defendant filed an answer to the complaint, admitting the allegations of the first count of the complaint, except the allegations that insured during her lifetime met all the terms and conditions of said benefit certificate, and the constitution and by-laws of said association, and this it denied. It also denied that the plaintiffs, since the death of Mrs. Whitesell, had performed and complied with the terms and conditions of the constitution and by-laws, to be kept and performed by them. It also denied the existence of the arrangement for collecting the dues and assessments through the Union National Bank, and denied the allegation of the plaintiff that no notice of premium due was given to the insured. No affirmative defense stating facts showing lapse or forfeiture of the certificate was alleged in this answer.

The case was called for trial before the court without a jury on October 4, 1939, and tried on that date. The court took the case under advisement. On November 21, 1939, while the court still had the case under advisement,, defendant made a motion for leave to file an amended answer and to introduce additional evidence, denying several matters that had been admitted in the original answer, and setting up affirmative defenses to both counts of the complaint. The court denied leave to file this proposed amended answer.

On February 9, 1940, the ¡defendant moved for leave to file a second amended answer, which was very lengthy and consisted of forty-five typewritten pages. Defendant also asked leave to offer additional evidence in support of said proposed second amended answer. The court took these motions under advisement with the case, and at the time the case was decided on April 8, 1940, it denied the motions of February 9, and February 16.

The evidence discloses that on September 15, 1924, the defendant issued to Minnie M. Whitesell its benefit certificate, entitling the plaintiffs to fifteen hundred dollars insurance, in the event of the death of the insured while she was a member in good standing of the defendant association.

Mrs. Whitesell paid her dues and per capita tax to June 30, 1938. She had paid the last assessment for benefits on April 28, 1938. She died on June 11, 1938 in the State of Virginia, where she was then living. On June 24, 1938, the secretary of the defendant, wrote one of the plaintiffs that her mother’s policy had lapsed on June 1, 1938 for failure to pay “May temporary payment,” and that her insurance was not in force at the time of her death.

The proofs show that for several years, prior to Minnie M. Whitesell’s death, the Union National Bank of Macomb had paid her assessments to the defendant. The secretary of the defendant would take the receipt in the amount that was due, to the bank and collect the amount due thereon. This had been going on, covering the terms of several secretaries, — and for a period of more than ten years, and on April 28, 1938, a collection had been made by the secretary of the defendant in this same manner. That was the last time the secretary called upon the bank to collect the payment. The bank had never refused a payment. The secretary did not take any receipt to the bank during the month of May of that year. It appears that the insured had more than enough money, on deposit at the bank, to be used to pay the assessment in question during the month of May and to June 11, — the date of her death. The defendant failed to make any explanation in the proofs of why it suddenly stopped collecting the insured’s assessment from the bank, neither is there any proof that notice was given the insured of their intention of terminating the arrangement for collecting the dues from the bank.

The trial court found in favor of the plaintiffs and entered a judgment against the defendant in the sum of sixteen hundred and six dollars and four cents ($1,606.04). The defendant’s principal ground for reversal is its contention that Mrs. Whitesell forfeited her certificate of insurance by not making any payments after the 28th day of April 1938, and up to the date of her death, being June 11, 1938.

It appears from the evidence that just prior to the death of the insured, the defendant was engaged in changing its system from assessment to premium basis, and had amended its constitution and by-laws to bring this about, and had sent out certain printed statements encouraging the existing certificate holders to change to the new plan. The language used in section 60 of the by-laws fixing the time of payment “from and after the first day of May, upon the annual term rate,” is, to say the least indefinite and uncertain. Under no rules of construction can it be said to mean on the first day of May. The defendant has filed an extensive brief and argument in this cause, and in its brief the nearest it comes to a definite construction is some day between the first day of May, and the death of the insured. It takes the position that there should be a forfeiture because there was no payment during that time, but does not pretend to say what particular day the money was to be paid or how much. With the loose and indefinite language in section 60, it cannot be made the basis of a forfeiture. If it was intended the premium should be due May 1, the words “on” or “by” would have been used and not “from and after.” If there is doubt as to the meaning of the language used in defendant’s by-laws, that doubt must be resolved in favor of the plaintiffs and against the defendant. Grand Legion Illinois Select Knights of America v. Beaty, 224 Ill. 346, 350; Miller v. Grand Lodge Brotherhood of Railroad Trainmen, 282 Ill. 430, 438; Switchmen’s Union of North America v. Colehouse, 227 Ill. 561, 564, 565; Terwilliger v. National Masonic Accident Ass’n, 197 Ill. 9, 12, 13.

Contracts of insurance of mutual benefit associations, like all other insurance contracts, are construed in favor of the insured and beneficiaries, and against the company, where there is any doubt in the language. The language is selected by the association and, if susceptible of two constructions, that most favorable to appellees must be adopted. Terwilliger v. National Masonic Accident Ass’n, 197 Ill. 9, 13; Forest City Ins. Co. v. Hardesty, 182 Ill. 39; Union Mutual Accident Ass’n v. Frohard, 134 Ill. 228.

Forfeiture provisions of by-laws are always construed strictly against the company and liberally to the insured and her beneficiaries. No forfeiture will be enforced unless definitely contracted for. Union Trust Co. v. Chicago National Life Ins. Co., 267 Ill. App. 470, 474; Grand Lodge A. O. U. W. v. Bagley, 164 Ill. 340, 343; Ingersoll v. Mutual Life Ins. Co. of New York, 156 Ill. App. 568, 573.

The insured lived in Virginia, and she had paid all assessments levied to April 28, 1938, and she left sufficient money in the bank to pay for any additional assessments that might be levied. There is nothing in this record from beginning to end to show that she was ever given an opportunity by the defendant to know how much, if anything, was due after April 28, and on what date it was due. This is emphasized by the letter of the defendant written immediately after the death to one of the beneficiaries stating that the certificate had lapsed for failure to pay the “May temporary payment.” The amount of this May temporary payment is not disclosed by the record, nor what day in May it should have been paid. The secretary who had been handling this work for the defendant was ill in bed during the month of May, and her work was being done by an insurance man from Chicago. The defendant cannot claim a forfeiture for nonpayment where its own agent failed to present the receipt in accordance with the long established method of collecting unless it gives actual notice to the insured that this method of collecting would no longer be pursued. Harris v. Sovereign Camp of the Woodmen of the World, 374 Ill. 47, 49 (aff’g 302 Ill. App. 310, 321); Dromgold v. Royal Neighbors of America, 261 Ill. 60, 65; Palmeter v. Court of Honor, 212 Ill. App. 565, 569.

The local secretary of the defendant was its agent in collecting dues and the knowledge of the secretary of the practice and custom of collecting the assessment in question was knowledge to the defendant. Niemann v. Security Benefit Ass’n, 350 Ill. 308, 316; Zeman v. North American Union, 263 Ill. 304, 312.

Notice to Mrs. Wkitesell of the definite time when the premium was payable and the amount of it, was necessary before her certificate could be forfeited for nonpayment, even though there was no provision for notice in the by-laws. Catholic Order of Foresters v. Fitzpatrick, 58 Ill. App. 376, 379; Switchmen’s Union of North America v. Colehouse, 227 Ill. 561, 566.

The defendant’s complaint on the court’s ruling, denying it leave to file additional answers after trial, is not ground for reversal, — for the view that we take of this case is that there is nothing in the amended answers that would set up a defense. Defendant complains of the court’s ruling and excluding two letters offered by it. As to the first, there was no proper foundation laid, and the second was not material on any of the issues in the case.

The trial court was amply warranted in the conclusions reached and the judgment entered. For the reasons herein stated, the judgment of the circuit court of McDonough county is affirmed.

Judgment affirmed.


author: Mr. Presiding Justice Hates

text:
    Alton Railroad Company, Appellee, v. F. Gillarde, Trading as Springfield Produce Company, Appellant.
    Gen. No. 9,264.

      Heard in this court at the October term, 1940.
    Opinion filed November 3, 1941.
    Edward Pree and Harold Werner, both of Springfield, for appellant.
    William L. Patton, of Springfield, for appellee; Silas H. Strawn, of Chicago, of counsel.
   Mr. Presiding Justice Hates

delivered the opinion of the court.

The Alton Railroad Company filed a complaint in the circuit court of Sangamon county against F. Gillarde, doing business as the Springfield Produce Company, to collect three hundred forty-three dollars and ninety-five cents ($343.95) in freight charges. These charges were assessed against a carload of grapefruit shipped by C. H. Taylor & Company at Wauchula, Florida, to F. N. Hicks at Waycross, Georgia, freight to be paid by the consignee or such person as might become reconsignee. Hicks reconsigned the shipment to F. Gillarde at Springfield, Illinois, who removed about two thirds of the grapefruit and then ordered the car diverted to P. H. Sproat & Company at Decatur, Illinois. The railroad was directed to ship the car, all charges prepaid, at Springfield, Illinois. Gillarde also notified the railroad that the shipment was subject to a draft on a Decatur bank with written order attached, and instructed it to deliver the goods to Sproat & Company, upon the surrender of the written order. Gillarde then paid the freight charges, by check, to the local agent of the railroad company, but this agent, by mistake, sent the car of grapefruit to Decatur on a collect bill of lading. When Sproat & Company discovered this, they telephoned Gillarde, informing him that the car had not been sent prepaid, and they could not pay the freight charges and also honor the draft. Gillarde contacted the railroad’s agent in Springfield, who discovered the mistake and told him that the railroad would collect the freight charges from Sproat & Company at Decatur, pursuant to the terms of the collect bill of lading. He also asked Gillarde to wire the agent at Decatur to release the contents of the car to Sproat & Company, without surrender of the written order. Gillarde did so, and the grapefruit was turned over to Sproat & Company, who paid the freight charges by check. Gillarde’s check was returned to him by the railroad; the check of Sproat & Company was later returned to the railroad by the bank marked “not sufficient funds.” About eight months later, on September 12, 1933, Sproat & Company went into receivership. The railroad, as a creditor, has received a dividend from the receiver of nine dollars and three cents ($9.03) on their claim for the amount of the freight bill. On January 2, 1935, the railroad notified Gillarde that these particular freight charges had not been paid in full, and that they would look to him for the balance. On January 21, 1936, it started suit against Gillarde in the circuit court of Sangamon county and judgment was entered against him on May 13, 1940 for three hundred and forty-three dollars and ninety-five cents ($343.95) and costs. Gillarde has appealed to this court to reverse that judgment.

It is apparent from an examination of the authorities in this and other States that there is a division of opinion as to the liability for freight charges of a consignee of goods who reconsigns them. In our own State, the Supreme Court has not passed upon the question and the decisions of the Appellate Courts are in conflict. In Chicago I. & S. R. Co. v. D. E. McMillan & Bros. Coal Co., 207 Ill. App. 58, a consignee of goods reconsigned them with directions to the carrier to collect the freight charges from the reconsignee. The carrier failed to collect them and the court held that it could not recover them from the consignee. In Pere Marquette R. Co. v. American Coal & Supply Co., 239 Ill. App. 139, and Chesapeake & Ohio Ry. Co. v. Southern Coal, Coke & Mining Co., 254 Ill. App. 238, similar results were reached, the court holding in both instances that a consignee who reconsigns goods does not by that act exercise such constructive ownership over the shipment as to render him liable to the carrier' for freight charges. On the other hand in Chicago I. & L. R. Co. v. Monarch Lumber Co., 202 Ill. App. 20; New York Cent. R. Co. v. Platt & Brahm Coal Co., 236 Ill. App. 150; Indiana Harbor Belt R. Co. v. Lieberman, 245 Ill. App. 503; Mellon v. Landeck, 248 Ill. App. 353, and New York Cent. R. Co. v. Palella, 306 Ill. App. 279, 28 N. E. (2d) 494, the rule is announced, that where an interstate shipment is diverted or reconsigned to a third party, the consignee ordering such reconsignment, thereby accepts the services rendered and exercises domination over the shipment consistent with ownership, hence becoming liable to the carrier for all transportation charges. In all of these cases, however, the consignee reconsigned the shipments and merely directed the carrier to collect freight charges at their final destination. In the case at bar, it should be noted that the original agreement between Grillarde and the railroad provided that freight charges should be paid by him and the shipment reconsigned to Decatur, prepaid, subject to sight draft with written order attached. Then, because of the mistake made by the railroad’s agent at Springfield, and at his request, Grillarde ordered that the shipment be released at Decatur without the surrender of the written order and agreed with the agent that freight charges should be collected at Decatur. Under these circumstances, we believe that the railroad agreed with Gillarde that it would look solely to Sproat & Company at Decatur for payment of its freight charges, as it had the power to do.

In Louisville & National R. Co. v. Central Iron & Coal Co., 265 U. S. 59, the Supreme Court of the United States held that freight rates on interstate shipments are fixed by federal law, and no contract of the carrier can reduce the amount legally payable or preclude it from enforcing payment of the full amount by a person hable therefor. The court continued however: “But delivery of goods to a carrier for shipment does not, under the Interstate Commerce Act, impose upon a shipper an absolute obligation to pay the freight charges. The tariff did not provide when or by whom the payment should be made. As to these matters carrier and shipper were left free to contract, subject to the rule which prohibits discrimination. ...”

In Dare v. New York Cent. R. Co., 20 F. (2d) 379, the circuit court of appeals for the second circuit declared: “It has been authoritatively established that a consignee who receives the goods becomes legally bound to pay the freight charges. . . . Such charges must coincide with the rate fixed by law, notwithstanding contractual arrangements between consignee and carrier to the contrary. . . . Even if it be assumed that the consignee might substitute another’s obligation for his own, a mere direction in the order of delivery to collect freight from another would not be sufficient. . . . There should be some effective substitution by novation, or otherwise, so that the new debtor would become legally bound to the carrier for freight before the consignee is freed.”

We do not deem it necessary to decide which of the conflicting views expressed in the Illinois cases cited above is the better. Assuming that the correct rule is that imposing liability upon the consignee, even where the carrier is directed to collect freight charges at final destination, this rule is not applicable here. The railroad agreed to substitute the liability of Sproat & Company for that of Gillarde, and this agreement was effective. Having made this agreement, in order to correct its mistake in failing to send the shipment of grapefruit to Decatur on a prepaid bill of lading, any loss occasioned by its neglect to collect the freight charges there, before releasing the goods, must fall upon the railroad.

The judgment of the circuit court of Sangamon county is therefore reversed.

Judgment reversed.