text:
    George Rugen and Amanda Rugen, Appellees, v. Arthur L. Van Berschot and E. B. Harrell, Appellants.
    Gen. No. 36,820.

      Opinion filed March 14, 1934.
    Heard in the third division of this court for the first district at the June term, 1933.
    Rehearing denied March 30, 1934.
    Rothbart & Lewis and Packard, Barnes, McCaughey & Schumacher, for appellants; George Packard, Seymour M. Lewis, Russell J. McCaughey and Julius M. Rosenfield, of counsel.
    Frank J. Tyrrell, for appellees; Jacob Kosbie, of counsel.
   Mr. Justice Wilson

delivered the opinion of the court.

This was an action brought by George Rugen and Amanda Rugen, his wife, against Arthur L. Van Berschot and E. B. Harrell and others in the superior court of Cook county, on the chancery side, to restrain the enforcement of a judgment .of the superior court in a proceeding which had been instituted by themselves against the defendant Harrell, and also praying in their bill of complainant for the rescission of a contract between Amanda Rugen and Perry Perkins. Perkins, one of the defendants, was never served with process and others of the defendants took no part in the trial and this appeal is prayed, allowed, and perfected by Van Bersehot and Harrell.

The amended bill charged that George Rugen and Amanda Rugen were the owners of promissory notes of the value of $30,000; that on or about the 8th day of June, 1931, Van Bersehot, Perkins and Harrell entered into a conspiracy and conspired together for the purpose of gaining possession of the notes of the complainants. The foundation of the bill seems to be based upon the wooing of the complainant, Amanda Rugen, by the defendant Van Bersehot during which he expressed his affections for her and caused her to place faith and confidence in him. The complainant, Amanda Rugen, relying upon these representations and manifestations of affection, entered into an agreement with Van Bersehot under which the complainants agreed to purchase approximately 71 acres of land in the Rio Grande Valley, Texas, and in consideration therefore to exchange a residence located in Des Plaines, Illinois, together with $27,000 of the notes in question and $3,000 in mortgage notes.

It is not clear from the bill just what the fraud practiced upon George Rugen was, but it is evident that he is seeking to avail himself of the promises of Van Bersehot to marry his, Rugen’s, wife.

The bill also charges that at the time Amanda Rugen signed the contract she did not have her glasses with her and therefore could not read the agreement.

Before discussing the evidence it might be well to consider the original proceeding which was started in the superior court by the complainants as a suit in replevin against Harrell, the holder of the notes. There is no direct evidence that Harrell participated in any conspiracy. The complainant had no talks or dealings with' him and, so far as is disclosed, his only connection with the defendants appears to have been that he had driven the car of Perkins when he, Perkins, took the parties out to view land situated in the Rio Grande Valley.

Harrell testified that he had lived at Mercedes, Texas, for 9 or 10 years and was in the container business and prior to that in the produce business; that he was the owner of the notes totaling about $14,500 which he had obtained from Perkins, and that as a consideration he gave to Perkins $5,000 of Mercedes Development Company stock and $4,700 worth of Hidalgo County Road and Bridge Warrants. There is. no testimony as to the value of the stock and warrants other than that of Harrell, who testified they were worth their face value. He also testified that he had been in business in Texas and owned land on which he employed others to do the work. He sent the notes for collection through the Hidalgo County Bank & Trust Co. to the Continental Bank of Chicago as they became due, but they were not paid. Subsequently, Van Bersehot, who was in Chicago, wired stating that he had a sale for the notes and that if he, Harrell, would bring them to Chicago he would be able to sell them. Thereupon, he came to Chicago and was introduced to a Mr. Schmidt who told him there would be a delay of a few days and he was taken by a Mr. Branower to an office in Chicago where he was introduced to a man who told him he was the secretary to the man who was to purchase, the notes and seated that he wished to check them over; that thereupon, he, Harrell, laid his notes on the desk and they checked them over and asked him in what form he wanted the money, and just then the man who said he represented the one who was to purchase the notes told him he was from the State’s attorney’s office and had a writ of replevin and several deputy sheriffs appeared on the scene and read this writ to him; that he accompanied the deputy sheriff to the office of the sheriff, but they would not give him a receipt for -the notes. This transaction took place in the office of Branower, who appears to have been an indorser on the back of the notes held by Harrell. The defendant, Harrell, was served as John Doe, and it appears that one Jacob Kosbie, one of the solicitors for complainants here, and the attorney in the replevin suit for the plaintiffs, either served the writ or was present at the time.

The entire transaction shows on its face that no person intended to purchase the notes and that Harrell was induced to come into the jurisdiction of the courts of Cook county by a subterfuge and was met by a summons made out to John Doe, defendant, as a result of which he found himself a party to the replevin suit brought by the Rugens.

While the value of the notes was over $10,000, the bond to the sheriff was for only $5,000, although the statute required a bond in twice the amount of the value of the property replevined. This all took place about August 1, 1931, although the sheriff did not return the replevin writ with his indorsement thereon together with a statement of the bond until April, 1932, and then only in answer to a petition filed by Harrell in the replevin suit. On motion of Harrell in the superior court in the replevin suit an order was entered requiring the plaintiffs to furnish a proper bond of $40,000. This plaintiffs failed to do and an order was entered in that court dismissing the replevin action and an order of retorno habendo entered of record. No appeal was perfected from this order although prayed and as it stood it was complete with a judgment for costs against the plaintiffs. This final order was entered May 17, 1932, but in the meantime on May 4 of that year, this bill of complaint was filed in the superior court and a temporary injunction secured from Judge Lindsay without notice. At the time of obtaining the temporary injunction a bond of only $500 was required and furnished. On motion of the defendant Harrell this injunction was dissolved on May 16, 1932, by Judge Lindsay. Subsequently and long after the judgment retorno habendo, Judge Gentzel, sitting in chancery, granted another injunction on an amended bill of complaint on the filing of a $5,000 bond which, in effect, restrained the sheriff of Cook county from turning over the notes under the order of Judge Steffen. Thereupon Van Bersehot asked for and obtained the appointment of a receiver to hold the notes.

We are at the outset of this case confronted with the unique position of finding a complainant who had elected to bring an action at law in replevin, after being defeated in that action, asking by a bill in chancery in a court of concurrent jurisdiction that the execution of the judgment be restrained. We are familiar with the rule that where a party who has been made defendant in a proceeding at law comes into chancery and sets up facts showing that he has a good defense to the action which is not cognizable at law, that a court of equity will take jurisdiction of the matter. But, in this case, the defendant does not come into a court of chancery, but instead we find a plaintiff seeking to avail himself of this right where he, himself, had previously invoked the jurisdiction of a law court and had met with defeat. Even though a defendant has had a judgment rendered against him, a court of equity will take jurisdiction but only in conformity with the statute requiring a bond in twice the amount of the judgment. In the case at bar the bond required of the plaintiffs was far less than the value of the goods replevied. We find then that we are confronted with a situation where a court at law had rendered a judgment against the complainants in a suit brought about on their own motion and where the defendant in that proceeding had been brought into the jurisdiction of the court by a subterfuge. Thereupon another court had granted an injunction in a chancery proceeding and dissolved it upon a motion of defendants when apprised of the situation. After this a third court again grants an injunction and requires a bond of complainants at much less than the value of the notes. It does not appear as if the complainants were in a court of chancery as a result of their action with a record without blemish. We further find one of the complainants, Amanda Bugen, openly charging in her bill of complaint that she had agreed with one of the conspirators to desert her husband and family, violate her marriage vows and elope with the conspirator Van Berschot. We also find the husband seeking to avail himself of the fact that his wife had consented to desert him in order to avail himself of that fact in an action to set aside a contract which he had not entered into. He makes' no claim that any fraud was practiced on himself, but claims a joint ownership in the notes.

George Bugen testified that he first met Van Berschot about May 10, 1931, at Bugen’s home in Des Plaines. Van Berschot told him he would like to have him go to Texas to inspect some land. Bugen stated that he had already been in Texas in February and liked the country and would take the trip. He and his wife and his son and his son’s wife paid $25 for the trip and left Chicago for Texas on May 12th. Accompanying them on this trip were also Carlson, Van Berschot, Gunnell and Mrs. Bugen’s brother and his wife. They were taken out to see some property and inspected some of the groves which were for sale. They were then taken up to the clubhouse and subsequently taken over to Mexico on a pleasure trip. They examined some property which Bugen said he was willing to pay for at the rate of $1,000 an acre for 10 acres if Mrs. Bugen was willing to be a party. Bugen stated that there was a difference in the value of uncultivated land and land with two-year-old trees on it to the extent of $200 or $400 per acre. On this trip a contract was signed by the Bugens for 10 acres at $10,000 with an option for an additional 10 acres, upon written notice by the purchasers, the Bugens. The Bugens then returned to Chicago and on or about June 6th, Mr. and Mrs. Rugen again left for Texas with Van Bersehot. Part of-the understanding of this second trip was that Rugen was to get a prospect and take him with them on the trip in order that Van Bersehot would be able to sell some property to the new prospect. Rugen testified that he got a Mr. and Mrs. Fred Kropp to go on the trip with them for that purpose; that Gunnell took Kropp out and showed him the 10 acres which he, Rugen, had contracted for, but that Kropp was not much impressed and went home the same night; that the Rugens remained in Texas two or three days and then drove to Matamoros where they had dinner and a man came up to the table and Van Bersehot introduced him as Perry Perkins; that they then all rode to a resort where they had roulette wheels and the next day he, Rugen, was taken around and introduced to various individuals owning property who told him of the receipts they derived from the cultivation of these lands and showed him statements from the bank. Rugen’s testimony is interspersed with a description of the manner in which they were conveyed around in automobiles and statements of Gunnell to him that Van Bersehot was trying to “vamp” Mrs. Rugen. The party returned to Chicago, arriving here about June 13th. While he, Rugen, was in the bedroom at his home in Des Plaines, he saw a piece of paper sticking out of a book and found that it was a contract between his wife and Perkins for a 71-acre tract for a consideration of $41,000 and which recited that the trust notes executed by the Chicago Title & Trust Company had been turned over as part payment. He then located Stewart Van Bersehot at a restaurant and took a receipt for the $30,000 worth of interest notes and was informed by him that they were at the Continental Bank; that the next day he, Rugen, saw a lawyer. Rugen testified further that he had never signed any deed transferring the Henry avenue home. This was the house located in Des Plaines. Neither did Mrs. Bugen acknowledge the deed.

On cross-examination Bugen stated that he had heard a good deal about the price of land in the Bio Grande Valley at the time he was there on his second trip; that he agreed to give them $1,000 an acre for the property for the 10-acre tract which he agreed to purchase, provided they would take the property on Henry avenue for the sum of $6,900. Sometime after he returned from Texas, after the last trip and after he had seen the contract between his wife and Perkins, Bugen and his wife, together with Carlson and Gunnell, defendants herein, took a two weeks’ automobile trip in the east.

Amanda Bugen testified that she and her husband had owned a farm near Glenview and sold it for $65,000 and received $25,000 in cash and took a $40,000 mortgage, of which $10,000 had been paid; that the $30,000 worth of notes remaining belong to herself and husband and these notes were the subject of this suit; that she first met Van Bersehot in May, 1931, but that her husband and brother knew Gunnell before that time; that Van Bersehot kept coming to see her after that for several weeks and begged her to trust bim and in the early part of June he wanted to take her to Hot Springs to get a divorce and that he stated that she deserved a better man than her husband and that he would take good care of her and marry her and that she believed him; that she was not on good terms with her husband and did not care for him; that she and her husband took the trip to Texas and drove around to various places in a Cadillac car, which Van Bersehot stated that he owned; that she was introduced to Perkins by Van Bersehot and that Van Bersehot asked to have her notes so that he could show them to Perkins; that she went to her room and got the notes; that Van Bersehot came back about dark to the clubhouse and took her into his office which he had at the club and had some papers in his hand and stated that he had obtained the option from Perkins at his own price but needed her signature; that Van Berschot said he intended .to marry her and he then covered the papers so that she could not see the writing and told her to sign her name; that she told him she would have to go in and get her glasses to read the papers, but that he said for her not to doubt him and that she then signed. She testified further that Van Berschot stated that he would sell the property for $1,500 (probably per acre) and that she would have her profit by spring; that they then sat down for supper with Mr. Knapp, his son and wife, Perkins and Mr. Rugen; that after supper Mr. Van Berschot told her to pack immediately as they were all leaving for Chicago.

On cross-examination Amanda Rugen testified that she had not worn glasses on any of the occasions that she was in the courtroom, but after examining the trust deed she was able to identify it as the one she signed. She further testified that she had agreed to purchase 10 acres on her first trip to Texas and had signed a written notice to the effect that she did not desire -the additional 10 acres. She also testified that she received the deed for the 10 acres from Van Berschot several weeks after she returned from the first trip to Texas and she executed a deed to the house on Henry avenue for the 10 acres together with Mr. Rugen and gave it to Van Berschot: It was on the second trip and after this first purchase that she signed the contract in question and gave the notes as part of the purchase price for the 71 acres. She also stated that her husband was to get a commission from any deals with prospects he might procure who purchased land, on this second trip; that they induced the Kropps to go along for that purpose.

Robert Rugen, the son, who was married and 24 years of age, testified that he tapped the wires connected with his mother’s telephone at the Des Plaines house and heard the conversations between Arthur Van Bersehot and his mother, in which Van Bersehot wanted to know what was wrong and how Mr. Rugen found out what was going on around the place. This was after the last trip to Texas.

Neither of the Rugens connected Harrell with the transaction in any way, nor did they refer to him at any time in their testimony. It does appear from their testimony, however, that they were driven around the country by Van Bersehot in a Cadillac car which he claimed was his and were also driven around by Knapp and Crenshaw. According to their testimony they first met Perkins at the clubhouse at the time the contract between Perkins and Amanda Rugen was entered into. From this testimony it is apparent that the Rugens did not see Perkins until the day before the contract was signed and there is no evidence that they at any time saw, talked with, or drove around with, Harrell, the defendant in this proceeding.

A witness by the name of Leola Hager, who appears to have been in Texas at various times and engaged in the land selling business, testified that she had seen Harrell and Perkins together in the lower Rio G-rande Valley and that he, Harrell, continuously drove Perkins’ car.

A witness by the name of Sam Kosbie, a brother of the attorney for the complainants, in rebuttal testified that he was in Mercedes in March of 1930, and that he rode in a car driven by Harrell and had a few conversations with him in which he told him, Kosbie, that he had a farm there and that he was hired by Perkins to drive these people around. This appears to have been the only time Kosbie was in Texas. He did not remember the kind of car it was, arid Harrell denies ever having heard of this man Kosbie.

Harrell’s testimony has been referred to already. He stated that he had known Perkins for a number of years, but had never been associated with him in any real estate transactions nor had he been associated with Van Bersehot; that he did not know from whom Perkins obtained the notes and knew nothing about the contract between Perkins and Amanda Bugen; that he had not acted as a chauffeur or a handy man in driving cars, but had on one or two occasions driven Mr. Perkins’ car when he, Perkins, was in it and that Perkins had on one or two.occasions driven his, Harrell’s, car; that he banked at the First National Bank and the Hidalgo County Bank and Trust Company and had approximately $2,000 or $3,000 on deposit at the time he purchased the notes; that he was not in Mercedes during the month of June, 1931; that he never drove any tourist parties for Perkins; that when he purchased the notes he was told they were secured by property in or near Chicago, Illinois, and that he did not know how much Perkins had received by reason of his contract with Amanda Bugen; that he supposed that Perkins was the lawful owner of the notes; that Perkins told him he had received a wire from Van Bersehot telling him if he would take his, Harrell’s, notes to Chicago he would be paid for them. He stated further that he thought the investment was good and at the time he made it, including the notes in question, his worldly worth was approximately $35,000.

Complainants insist that Harrell on cross-examination stated that he did not care a lot about the $14,500. An examination of the record, however, shows that he was interrogated as follows:

“Q. You did not care an awful lot about this $14,500, did you?
“A. Yes sir.”

The answer to this interrogatory might be interpreted either way. It may as well havé meant that he did care about the $14,500.

The basis of compláinants’ bill is that the contract was procured by reason of the fraud perpetrated by Perkins, Van Bersehot, Kiss ell, Nueberger, Branower and Hirschritt. There is no evidence that Kissell, Neuberger, Branower or Hirschritt obtained anything by reason of the transaction. The only evidence as to Perkins appears to be that he was the party who entered into the agreement and he does not appear to have said or done anything which contributed to the procurement of the agreement. The entire transaction appears to have been brought about and manipulated by Van Bersehot and he is charged with having promised to marry the complainant, Amanda Rugen, and thus obtained her confidence. He also held out to her an inducement that in the spring she would be able to sell the property and make a profit. She was a married woman at the time and with her on the trip were her husband, her son and his wife and her brother and his wife. She stated that relying upon Van Bersehot’s promise to marry her she signed the papers without reading them. It does not appear from the evidence, however, that she was unaware of what the contents of the contract consisted. She apparently understood that she was purchasing 71 acres of land in Texas owned by Perkins and was to pay a certain price and to give her notes, secured by the Chicago mortgage as part of the purchase price, which she did.

A party who signs an instrument relying upon representations as to its contents when he has an opportunity to ascertain the truth by reading and does not avail himself of the opportunity, cannot be heard to say that he was deceived by misrepresentations. Dickinson v. Dickinson, 305 Ill. 521.

The transaction in question took place on or about July 1, 1931. A bill to rescind a contract on the ground of fraud should be started as soon as the fraud is discovered. Day v. Fort Scott Investment & Improvement Co., 153 Ill. 293. The bill in this case was filed in May, 1932, nearly a year after the" transaction and at least 10 months after the alleged fraud was discovered. In a bill to set aside a deed procured by fraud, the burden is upon the complainant and the proof must be clear and convincing. Kuska v. Vankat, 341 Ill. 358; Schiavone v. Ashton, 332 Ill. 484.

Perkins is not a party to this proceeding and, consequently, the contract cannot be set aside or voided. The decree of the superior court recognizes this fact and makes no such order. Neither is there any finding in the decree to the effect that Kissell, Neuberger, Branower and Hirschritt were parties to the fraud, nor is there any order entered as to them. While the decree finds that the contract between Rugen and Perkins was secured by fraud and deceit and as a result of the conspiracy charged in the amended bill, this is not binding and unavailing because of the fact that Perkins is not a party to the suit and therefore cannot be bound by the decree even though he knew of the pendency of the cause.

There is no testimony in the record to the effect that Van Bersehot had any interest in the notes and the decree does not so find. There is no evidence in the record that Harrell participated in the alleged fraud and his only connection with the case appears to be that he was seen driving Perkins’ car on different occasions. There is no testimony that he drove Perkins’ car during any of the times while the Rugens were in Texas nor in connection with other visits to the various properties which they inspected. There is no testimony that he purchased the notes with knowledge of any fraud or want of consideration, and the only testimony in the record as to payment for the notes by Harrell is that of himself as already set out in this opinion. No matter what suspicions may arise by reason of the transaction, it cannot be said that such surmises or suspicions can attach to the defendant Harrell, even though he may have been acquainted with Perkins. They both lived in Mercedes, Texas, and there is nothing strange in their acquaintanceship. The transaction took place in Texas. The holder of negotiable paper indorsed in blank is presumed to be an innocent holder in due course. Mann v. Merchants’ Loan & Trust Co., 100 Ill. App. 224; Morey v. Simpson197 Ill. App. 55.

The property itself may have been of a considerably less value than the price paid, although Bugen testified that property with growing trees was worth from $200 to $400 per acre more than the uncultivated land. The record is silent as to whether or not the property in question was improved with fruit trees or crops. The Bugens had already paid $1,000 an acre for property which they had examined and concerning which they made no complaint. This price, while high, may not have been unusual in the Bio Grande Valley if irrigated and containing bearing fruit trees. In our opinion the record does not contain evidence sufficient to charge Harrell with the purchase of the notes in question with knowledge of a fraud perpetrated in their procurement.

The decree orders the receiver to turn over and deliver to the complainants the notes claimed by Harrell and that the injunction issued be made permanent. This is the only relief provided for in the decree and according to the testimony the only person affected thereby is the defendant Harrell and for that reason and the other reasons advanced in this opinion, the decree of the superior court is reversed and the cause remanded with directions to proceed in conformity with the views expressed in this opinion.

Judgment reversed and cause remanded with directions.

Hall, P. J., and Hebel, J., concur.


source: Caselaw Access Project

author: Mr. Justice Wilson

license: Public Domain

text:
    Minnie Sharpe, Defendant in Error, v. Second Baptist Church of Maywood et al., Plaintiffs, in Error.
    Gen. No. 36,912.
    Opinion filed March 14, 1934.
    Heard in the third division of this court for the first district at the October term, 1933.
    Sumner C. Palmer, for plaintiffs in error.
    No appearance for defendant in error.
   Mr. Justice Wilson

delivered the opinion of the court.

The plaintiff, Minnie Sharpe, confessed judgments, on certain judgment notes for $4,271.87, against the defendants, Second Baptist Church of Maywood, Thomas Wharton, G. A. Harrison, Scott Walke, R. Graham, Lee Martin, Daniel W. McLawnn, R. H. Howard, M. D. and James Outright. A motion was made by the defendants to vacate the judgments and an affidavit in support filed, wherein it was charged that the notes were not signed by the individuals, but that the notes were those of the Second Baptist Church alone. The court, however, denied the motion to vacate and from this order defendants pray an appeal to this court.

The notes appear to be'secured by a trust deed or mortgage, but contain the provision that the holder may resort to proceedings at law to collect, or prosecute proceedings in equity, or both. In the body of the notes it appears that they are executed by the Second Baptist Church of Maywood and are signed,

Second Baptist Church oe Maywood, By : Thomas Wharton,

G. A. Harrison,

Scott Waite,

B. Graham,

Lee Martin,

Daniel W. McLawnn,

B. H. Howard, M. D., and James H. Cartright,

Its Trustees.

The payment of the notes is guaranteed by the defendants individually. There appears, however, to have been a number of extensions and several payments made from time to time. The notes themselves, however, are the notes of the Second Baptist Church of Maywood. This may be gathered from the fact that the name of the church alone appears in the body of the instrument and the signature appears to be that of the church by the other defendants, its trustees. Almost the identical situation appears in the case of New Market Sav. Bank v. Gillet, 100 Ill. 254. In that case the note was signed by the name of the religious society, by its trustees, and the name of the society appeared in the body of the instrument. The court in its opinion says:

“It is said that the use of the word ‘we’ in the note, in its connection, to-wit: ‘we, the trustees,’ etc., leaves it doubtful on the face of the instrument who is bound. But how can this be? ‘We’ is immediately followed by ‘the trustees of the First Free Will Baptist Society of Chicago,’ and that is the corporate name of a corporation. How can this pronoun denote any one else than the corporation whose corporate name immediately follows it? No one else is named in the body of the note nor in the signature to it, as the only name subscribed is the corporate name of the corporation, the individual names of the trustees being used only in connection with their official style, and their use in such connection being in the required mode of making a corporation signature, as laid down in Lombard v. Chicago Sinai Congregation.
“It would, seem therefrom that this note was executed officially, not individually, — that the signature thereto is that of the corporate name of the corporation, and none other, — that the individual names of the trustees there, in the connection they appear, were not signed as individual acts, but in the performance of a corporate act, in order to the execution of the note in proper form as a note of the corporation, and that hence the note is that of the corporation, made by it under its corporate name, and not the note of the individual trustees.”

It is apparent that the notes were the notes of the church and that the individuals executed the notes and signed as trustees for the church. Under such circumstances it was error to have confessed judgment as against the individuals. The power to confess a judgment must.be clearly given and strictly pursued. Keen v. Bump, 286 Ill. 11. The fact that the individuals guaranteed the loan which was secured by the notes and trust agreement did not make them subject to a judgment by confession. Rights may have accrued to them by reason of the extension for the time of payment which they would have the right to assert at a hearing. The judgment being a joint judgment must be clear and unequivocal and the right to a confession of judgment will not be extended to those not clearly indicated. While the maker of a judgment note will be held, guarantors and sureties cannot be included within the judgment obtained by confession. Jarosh v. Easton, 57 Iowa 569. The Supreme Court of Iowa in that opinion said :

“III. We think, however, that the decree of the court below is right, for the reason that the cognovit does not authorize judgment to be entered against plaintiff, who signs it as surety, for the payment of the judgment to be rendered against Kavorek and Suchan. The instrument authorizes judgment against the principals only. There is not one word of authority for entry of judgment against plaintiff. It clearly appears to our minds that the plaintiff is only bound by the cognovit as a surety for the payment of the judgment. A careful reading of the instrument is all that is required to support our conclusion. Upon this ground the judgment of the Circuit Court will be affirmed. It will be understood that our decision does not preclude Easton from pursuing a remedy against plaintiff for the payment of the judgment.” To the same effect see Brandt v. Spiegelmire, 24 Pa. Dist. Rep. 131, wherein the court in its opinion said:
“Our cases invariably hold that a confession of judgment must be in the clear and unequivocal language, and so definite as not to be properly capable of any other construction. So, too, the contract of surety-ship is favorably regarded by the law and is construed strictly in favor of the surety. His liability will not be increased by mere construction. In view of these general principles of construction we are brought to the conclusion that there was no power in theprothonotary of Perry County to enter judgment against the six sureties.”

Holding as we do that the note was the note of the Second. Baptist Church of Maywood and not of the individuals who signed as trustees, the trial court erred in entering judgment by confession against all of these defendants. The judgment being a joint judgment it must be reversed as to all. Nothing in this opinion, however, is to prevent the trial court from entering judgment by confession ■ against the Second Baptist Church of Maywood, the maker of the note, nor by reason of anything expressed in this opinion is the plaintiff precluded from proceeding to obtain relief against the guarantors in a proper manner.

For the reasons stated in this opinion the order of the superior- court denying the motion to vacate the judgment is reversed and the cause is remanded with directions to vacate the judgment.

Judgment reversed and cause remanded with directions.

Hall, P. J., and Hebel, J., concur.


author: Mr. Justice Scanlan

text:
    Clara D. Watson, Defendant in Error, v. Edward Trinz and Rosalie K. Trinz, Plaintiffs in Error
    Gen. No. 36,491.

      Opinion filed March 6, 1934.
    Heard in the second division of this court for the first district at the February term, 1933.
    Rehearing denied and additional opinion filed April 7, 1934.
    John A. Bloomingston, for plaintiffs in error.
    Joseph D. Ryan, for defendant in error.
   Mr. Justice Scanlan

delivered the opinion of the court.

Clara D. Watson sued Marigold Garage Company, a corporation, Edward Trinz and his wife, Rosalie K. Trinz, to recover damages for personal injuries sustained by her. In a trial before a jury Marigold Garage Company was found not guilty and there was a verdict and judgment against Edward Trinz and Rosalie K. Trinz for $42,500. Edward Trinz and Rosalie K. Trinz sued out a writ of error to reverse the judgment, and thereafter we reversed the judgment and remanded the cause. (Watson v. Trinz, 262 Ill. App. 630 [Abst.].) Subsequently there was a second trial, and a jury returned a verdict finding defendants guilty and assessing plaintiff’s damages at the sum of $28,000. Defendants have again sued out a writ of error to reverse the judgment entered upon that verdict.

The amended declaration consists of four counts. The first alleges, in substance, that defendants, at the time of the accident, were possessed of and had charge and control of a certain automobile which was then and there, through their agent and servant, operated in a northerly direction on Sheridan road at its intersection with Cornelia avenue; that it was the duty of defendants to use ordinary care to guide, control, manage and operate the automobile; that while plaintiff, at the time and just prior thereto, was in the exercise of ordinary care for her own safety, defendants so carelessly, negligently and improperly drove the automobile that it struck plaintiff while she was crossing Sheridan road, in a westerly direction, at or near Cornelia avenue. The second count is like the first except that it alleges the car was being driven at a high and dangerous rate of speed, to wit, 40 miles an hour. The third alleges that defendants wilfully, wantonly and maliciously drove their automobile, and as a direct result of such conduct of defendants and each of them, plaintiff was knocked down to the ground and injured. The fourth charges defendants with conscious indifference to surrounding circumstances and conditions and that they then and there wilfully, wantonly and maliciously drove the automobile at a high, dangerous and excessive rate of speed, to wit, 40 miles an hour, within the limits of an incorporated city, contrary to the statute, and “wilfully, wantonly and maliciously drove and ran the automobile upon and against and struck the plaintiff with great force and violence. . . .” The Marigold Garage Company and Edward Trinz jointly filed the plea of the general issue and a special plea that they did not own, operate nor control the automobile, and Mrs. Trinz separately pleaded the general issue and a special plea that she did not own, operate nor control the automobile.

The accident happened on April 1, 1928, at about 11:30 p.m., at Sheridan road and Cornelia avenue, Chicago. Plaintiff was walking across Sheridan road in a westerly direction when the automobile in question, coming from the south, and driven and operated by one Smith, a servant in the general service of the Marigold Garage Company, struck her and she was severely injured. No contention is raised by defendants that plaintiff was guilty of contributory negligence, nor that the driver was not guilty of negligence, nor that the driver was not guilty of wilful and wanton conduct. The only defense, upon the merits, is that neither defendant was the master of Smith, and that he, at the time of the accident, was a servant of the former defendant Marigold Garage Company. Mr. Bloomingston represented the three defendants in the first trial and the two Trinzes in the second. He represented the two Trinzes in this court upon the first writ of error and the instant one.

Defendants contend that ‘ ‘ the trial court erred in reinstating Rosalie K. Trinz as a party defendant after having directed the jury to find her not guilty at the close of plaintiff’s evidence.” After the judgment in the first trial defendants strenuously contended in this court that there was no evidence to hold Mrs. Trinz. To quote from their brief:

“Plaintiff introduced in evidence the application for a license for the year in which the accident happened. This would be prima facie evidence of ownership as of the date of the application for the license and in the absence of other proof would create a presumption of ownership as of the date of the accident. If there was no other evidence of ownership, it would have been sufficient and conclusive. Plaintiff, however, put Mr. Trinz on the stand and proved conclusively by him that he owned the car and that his wife did not own it. Here is the testimony and, from, it the court will see that the evidence is clearly directed to the time when the accident happened.
“ ‘Mr. Ryan (counsel for plaintiff): Did you own that car?
A. I did.
Q. Are you sure of that?
A. Yes, sir.
Q. As a matter of fact, your wife owned it, didn’t she!
A. I took the car in my name.
Mr. Ryan: Jnst a moment. Isn’t it a fact that your wife owned the car, Rosalie Trinz, one of the other defendants in this case? Just answer yes or no.
A. No.’
‘‘ Having proved conclusively that Mrs. Trinz did not own the car, it is difficult to understand why judgment was permitted against her.
“. . . Hence we say that under the undisputed evidence and the plaintiff’s own evidence brought out by the plaintiff, Mr. Trinz was the sole owner of the car and hence a judgment against him and his wife must be set aside, for an erroneous judgment against one invalidates a judgment as to the other.” (Italics ours.) We sustained that contention and reversed the judgment-as to both defendants and remanded the cause. Mrs. Trinz did not testify and was not present at either trial. Interrogated by his counsel in the second trial, Trinz testified that he did not know the whereabouts of his wife. It is a reasonable inference from the record that the Trinzes were not living together and that Mrs. Trinz was not interested enough in the proceedings to attend the trials. Upon the second trial plaintiff, in chief, introduced no additional evidence tending to prove Mrs. Trinz’s ownership of the automobile. Upon both trials, plaintiff introduced a certificate of the Secretary of State to the effect that the license for the automobile for the year 1928 was issued, at her request, to Mrs. Trinz. In the application for the license Mrs. Trinz swore that she purchased the car on April 15, 1926, and was the owner of it. After plaintiff rested, counsel for defendants, in chambers, orally moved the court to find defendants not guilty, and after a conference there the trial court, after a consideration of our former decision, stated, in chambers: “The motion is allowed as to Eosalie Trinz and the jury will be instructed to find Eosalie Trinz not guilty. The motion as to the defendant, Edward Trinz, is denied and the instruction refused. ’ ’ The following then occurred in open court: “The Court (addressing the jury orally): . . . The Court instructs the jury to find the defendant, Eosalie Trinz, not guilty. That is the wife of the man — there are two defendants in this case, one the wife and one the husband, and the Court at this time instructs the jury to find the wife not guilty.” At the same session of court defendant Trinz took the stand in his own behalf. In response to a series of questions put to him by his counsel he testified that his wife was the owner of the car at the time of the accident. To quote from the record. “Q. Did you, at any time, own a Pierce-Arrow car? A. I did. Q. How long did you own it? A. I owned it about a year and a half. Q. And what did you do with- it, at the end of a year and a half ? A. I gave it to my wife as an anniversary present. Q. What was the date of giving it to your wife? A. It was the 27th of November 1927.” The accident occurred April 1, 1928. Trinz’s testimony was given very shortly after plaintiff had rested her case. As soon as he had testified to the foregoing, and before the completion of the direct examination, counsel for plaintiff made an oral motion “to reinstate this defendant this instant, and submit the question to the jury, and to withdraw the direction to find her Not Guilty. Therefore, my motion to reinstate Mrs. Trinz as a party defendant is entirely fitting at this time. . . . The Court: Proceed with this witness, and I will entertain your motion, Mr. Eyan, inasmuch as no written instruction has been given the jury, I will entertain your motion, but proceed with this witness. ... I will reserve my ruling on it.” Trinz then testified that he had purchased the car on April 12, 1926. Upon cross-examination he admitted that on the first trial he had testified that he, and not his wife, was the owner of the car at the time of the accident but that he “was wrong.” He then stated that at the former trial he did not understand that the questions referred to the time of the accident, but he finally admitted that he did know when the questions were put to him at the former trial that they related to the ownership of the car at the time of the accident. He further testified, upon cross-examination, that after he gave the car to his wife she, before the accident, gave it back to him; that he did not remember the date upon which she did that, but that he did not own the car at the time of the accident. Upon the following morning the trial court, after a consideration of the situation, stated to the jury the following: “The Court (orally addressing the jury): That this jury may understand the oral instruction given you yesterday, wherein the Court suggested to you that there being no evidence against Mrs. Trinz, that the Court would instruct the jury, ‘Find her not guilty’, in view of the evidence, the Court now wishes to retract that instruction to this jury. This case will proceed as against both defendants. I believe that is all the Court has to say.”

Plaintiff, at the close of her case, had made out a prima facie case of ownership of the car against Mrs. Trinz, but the trial court, reading our opinion and assuming, apparently, that the defense was acting in good faith with the court as to the ownership of the car, evidently concluded that it would be useless, in view of what we said in our former opinion, to retain Rosalie Trinz in the case, hence his oral instruction to the jury. We had held that while the certificate made out a prima facie case for plaintiff, the presumption of ownership thereby established was overcome by proof of positive facts, viz., the testimony of Trinz that he alone owned the antomobile. Had defendants’ counsel informed the court, upon the motion to direct, that Trinz intended, when called as a witness in his own behalf, to repudiate his former testimony, the trial court, in view of the fact that the plaintiff had made out a prima facie case against Mrs. Trinz, would not, of course, have acted as he did. Defendants’ counsel does not pretend that he was surprised by Trinz’s testimony. In fact, his examination of the witness shows clearly that he was not. In his argument to the jury he contended that Mrs. Trinz was the owner of the car at the time of the accident, and in this court he defends the testimony of Trinz on the second trial on the ground that “Trinz on the previous trial had forgotten that he had given the car to Mrs. Trinz.” Trinz made no such excuse. The very unusual situation presented to the trial court undoubtedly shocked his sense of justice, and it would be a serious commentary upon our procedure if the court had been helpless to protect the plaintiff from becoming a victim of a dishonest defense. The trial court rightfully considered the situation as a challenge to justice, for had the plan of defense succeeded, plaintiff, with an admitted right of action against one or more of the original defendants, would have lost her suit as to all defendants, by a shifty, tricky defense. Defendants do not come to this court with clean hands.

In support of the instant contention defendants argue that the trial court “lost jurisdiction by his previous order as to her (Mrs. Trinz), he had no right or authority to reinstate her.” “When she was directed out and the evidence went on without her being in the case the court lost jurisdiction as to her to render any order except on a motion for a new trial. Once out of the case her quondam counsel would have no right to agree to reinstate her. His right as her attorney ceased in so far as that phase of the case is concerned and there is nothing in his agency for her that would permit him to thus sacrifice her rights” (italics ours); that by no act of his could she be legally reinstated in the cause; that he was not “authorized to represent her after she was dismissed from the case. He certainly had no right to waive her constitutional right to cross-examine witnesses against her and the court had no right by his ruling to take that right away from her.”

The record shows that Mrs. Trinz did not submit a written motion for a directed verdict in her favor at the close of plaintiff’s case, nor a written instruction to that effect. No verdict was signed nor returned by the jury and no order nor judgment was entered by the court at the time of the oral instruction dismissing Mrs. Trinz. The oral retractment instruction was made during the same term of court, in fact, within a few hours after the first oral instruction was given. No final order had been entered from which an appeal could have been taken either by plaintiff or by Mrs. Trinz. The court had not lost jurisdiction as to her. In fact, defendants practically concede the point when they admit that the court still had jurisdiction, as to Mrs. Trinz, to pass upon a motion for a new trial.

The real question for us to determine is, Is Mrs. Trinz, under the record in this case, in a position to justly complain, as against plaintiff, that she was injured by the action of the court in retaining her in the case? No authorities are cited in support of the contention that Mr. Bloomingston had no authority to represent her after she was dismissed from the case, nor are we aware of any that under like facts so holds. That he did represent her to the end of the trial is clear. He did not withdraw his appearance as her attorney, and he opposed the retractment instruction. He introduced testimony of a number of witnesses on behalf of both defendants. He offered a written motion at the conclusion of all the evidence to have the jury-instructed in Mrs. Trinz’s favor. Upon the denial of that motion he requested, on her behalf, three peremptory instructions covering three counts of plaintiff’s amended declaration. In his closing argument to the jury he stated that he was making his argument on behalf of both defendants. At his request eleven instructions were given to the jury on behalf of both defendants, and five special instructions were given to the jury on behalf of Mrs. Trinz. He argued the motion for a new trial on her behalf and he is her attorney in this court.

As to the argument that “the effect of reinstating her was to permit evidence to be considered by the jury, as to her, as to which she had no opportunity to cross-examine:” This is the sole point urged that has any bearing on the complaint that she suffered substantial harm by reason of the retractment instruction. It is without the slightest merit. In considering this case it must always be borne in mind that in both trials defendants were represented by the same counsel. The only witnesses who testified for the defense prior to Trinz were Plume, the former manager of the garage, and Nelson. It seems idle to argue that although Mr. Bloomingston examined these witnesses on direct, on behalf of Trinz, Mrs. Trinz suffered because Mr. Bloomingston did not cross-examine them on her behalf and that plaintiff should suffer for his fault in that regard. Nor does the record show that after the retractment instruction Mr. Bloomingston was denied the right to bring the witnesses back and cross-examine them. The sole witness for the defense whose testimony injured Mrs. Trinz teas that of her husband, and her counsel placed the witness on the stand and purposely brought out that evidence. Without reference to the question as to whether it would have been correct procedure to allow Mr. Bloomingston to examine Trinz on direct and then cross-examine him on behalf of Mrs. Trinz, it is sufficient to say that Mr. Bloomingston, after the re-tractment instruction, made no request to cross-examine Trinz. But counsel seems to argue that he should have cross-examined Trinz on behalf of Mrs. Trinz and that although he did not do so, “he certainly had no right to waive her constitutional right to cross-examine witnesses against her. ’ ’ Just why plaintiff should be held responsible for this dereliction, if it was a dereliction, is not made plain to us. The logical effect of counsel’s argument is that he should have cross-examined Trinz on behalf of Mrs. Trinz and that his failure to do so now operates against plaintiff and to the advantage of both Trinzes. We readily concede that it would have been somewhat embarrassing for Mr. Bloomingston to cross-examine Trinz on behalf of Mrs. Trinz, but such embarrassment would have arisen from the fact that he assumed the duty of defending both. If the able and experienced counsel for Mrs. Trinz, in good faith, was satisfied that the court had no power to give the retractment instruction, he should have declined to participate in the trial thereafter. Mrs. Trinz elected, through her counsel, to continue in the case, and she cannot now assign error on the court’s ruling. (See Central Bond & Mtg. Co. v. Roeser, 323 Ill. 90, 97.) Nor did her counsel, at the time the so-called reinstatement instruction was given to the jury, move to withdraw a juror and continue the case, but stated his position as follows: “Mr. Blomingston: Now, as far as Mrs. Trinz is concerned, then the defendant, Mrs. Trinz, now takes the position, that she desires to introduce no evidence at all, after the close of the plaintiff’s testimony, and will stand by the record as made at that time, and we will ask at the appropriate time, —well, we will ask the Court now, to tell the jury that any evidence which will be introduced, which has been introduced since the close of plaintiff’s testimony, is not to be considered by the jury, in so far as the de- . fendant Rosalie Trinz is concerned. ’ ’ The counsel, by taking this position, conceded that Mrs. Trinz was still in the case and expected the jury to pass upon her guilt or innocence. In other words, counsel was willing to speculate on the result, and, as the record conclusively shows, Mrs. Trinz, through him, continued to actively participate in the trial thereafter. After a careful consideration of the instant contention we have reached the conclusion that the court did not commit reversible error in retaining Mrs. Trinz in the case, and that his action in that regard prevented the success of a plan to bring about a miscarriage of justice.

Defendants next contend that the court erred in overruling the motion of Mrs. Trinz, made after the retractment instruction, that she be allowed to stand on the evidence as made at the close of plaintiff’s case. As Mrs. Trinz did not stand upon this motion, but took part in the trial after the court overruled her motion, she will be deemed to have abandoned the motion. (Princell v. Pickwick Greyhound Lines, 262 Ill. App. 298. Certiorari denied by the Supreme Court.) In addition to what we have heretofore stated as to the participation of Mrs. Trinz in the trial after the retractment instruction, we may further state that instructions offered for both defendants, and special instructions offered for Mrs. Trinz, are based upon the theory that the jury had a right to consider all of the evidence in determining their verdict. It is significant that defendants’ next contention is predicated upon the assumption that the preponderance of the evidence is in Mrs. Trinz’s favor.

Defendants contend that “the verdict and judgment are against the law and the evidence as to each and both of the defendants and the preponderance of the evidence as a matter of law and fact is in favor of defendants and each of them.” After a very careful examination of all of the evidence we find no merit in it. The main point raised is that the driver of the automobile, at the time of the accident, was a servant of the Marigold Garage Company and was not a servant of either of the Trinzes. Plaintiff strenuously contends that the verdict of the jury in the first trial finding Marigold Garage Company not guilty was an adjudication not only of its nonliability, but also of every fact necessarily involved in that finding; that whatever the equities may be between the two Trinzes, neither can assert, as against plaintiff, that the Garage Company was operating the car. While a number of authorities are cited in support of the contention, we do not deem it necessary to pass upon it. In our former decision we said: “The law, however, recognizes that a servant in the general service of one, may be transferred, under contract or otherwise, to the service of another so as to become for the time being the latter’s servant, with all the legal consequences of that relationship. (Schweitzer v. Thompson & Norris Co., 229 N. Y. 97; Delaware & Hudson Co. v. Van Derpool, 292 Fed. 688; The P. C., C. & St. L. Ry. Co. v. Bovard, 223 Ill. 176; Harding v. St. Louis Stock Yards, supra [242 Ill. 444].) In Braxton v. Mendelson, 233 N. Y. 122, it was said: ‘Was the servant whose negligence injured a third party, performing work for his master within the scope of his employment or was he loaned by his master to another to do the latter’s business? In the one case the general employer is liable for his torts. In the other he is not. But while the rule is clear its application is often difficult.- The true relationship between master and servant may be obscured by circumstances seemingly contradictory.’ In the instant case there is some testimony tending to sustain the theory of the plaintiff. Where the facts are undisputed the existence of the relationship of master and servant is for the court. (Woods v. Bowman, 200 Ill. App. 612, and cases cited.) Under the pleadings and the evidence in the instant case, it was a question for the jury. (Kirn v. Chicago Journal Co., 195 Ill. App. 197; Shannon v. Nightingale, 321 Ill. 168.)” See also Allen-Garcia Co. v. Industrial Com., 334 Ill. 390, 394. Densby v. Bartlett, 318 Ill. 616, 620, cited by defendants, also recognizes the above principle. In the instant case, while Smith, the chauffeur, at the time of the accident was in the general employ of Marigold Garage, nevertheless, the jury were justified in finding from the evidence that when defendants used an employee of the garage, as they did Smith on the evening in question, the employee for the time being was a servant of defendants and not a servant of the garage; that a driver on such trips was directed and controlled by defendants and was loaned to them by the garage company as a “mere accommodation’ ’ as patrons of the garage, for which accommodation the garage received nothing. Plume, the manager of the garage, testified that Trinz paid them $25 monthly for storing, cleaning and polishing the car; that when a patron came to the garage and wanted a man to take him home the patron would pay the man by tipping him; that the employee of the garage company in driving the patron home and in driving the car back to the garage was subject to the orders of the patron; that there was a sign in the garage to the effect that if patrons used one of the employees in taking them home and in bringing the car back to the garage, the employee, in such work, was the servant of the patron, and that on the bills that were sent to Trinz monthly there was the wording, in plain type, “that cars driven by our employees are driven at owner’s risk.” Prom Mr. Plume’s testimony it appears that such service was not a part of the contract between the garage and Trinz, and it is evident that the use of an employee in such service involved a risk not incidental to the storage and care of the car, The witness Charles J. Bea testified that Trinz told him “that he had no arrangement with the garage about delivering the car or taking him home from the garage, although he frequently stopped at the garage and had someone take him home. He always gave the fellow a tip.” While Trinz testified, on the second trial, that he paid $2 or $2.50 a month to the garage for the use of the chauffeur, he admitted that he did not so testify at the first trial, and Plume testified that Trinz paid nothing for such service. Any honest, intelligent jury would place little, if any, reliance upon the testimony of Trinz upon any controverted question of fact in the case.

Under all the circumstances of this case there is no merit in the contention of Mrs. Trinz that she had nothing to do with the arrangements made with the garage and is therefore not bound by any agreement made between the garage and her husband, and that even if the driver of the car was her husband’s agent while performing the special service, he was not her agent. Trinz, with her knowledge and assent, held himself out as owner of the car and having full control over the same. She cannot hold her husband out as the owner of the car and in control of the same, and then avoid the effect of his action. She knew that the car was kept and taken care of at the Marigold garage and that arrangements had to be made in connection therewith, and she allowed her husband to deal with the garage as the owner of the car, and to pay the bills. She obtained a new trial from this court, after the first judgment, by strenuously contending that her husband owned the car at the time of the accident. She appears here now, after the second judgment, admitting, through her counsel, that she was the owner of the car at the time of the accident, but insisting that she must not be bound by any action of her husband or the driver.

We cannot agree with defendants’ contention that under the evidence given at the second trial it must be held that Mrs. Trinz was the sole owner of the car. Trinz admitted that on the first trial he testified that he was the sole owner of the car at the time of the accident, and that what he then said was true. Bea testified that before the first trial Trinz told him “that the automobile which injured Mrs. Watson was his, although neither he nor his family were in it at the time. ’ ’ Trinz admitted that he made an arrangement with the garage about the keep of the car. He constantly got the car out of the garage and used it as he saw fit. The garage bills for the keep of the car were sent to him and he paid them. He admitted that he made an arrangement with the garage company about using the employees for driving him home and taking the car back to the garage. He testified that he purchased the car on April 12, 1926. From Mrs. Trinz’s affidavit in her application for a license it would appear that she purchased the car April 15, 1926. In their brief filed in the instant writ of error defendants insist that the evidence proves conclusively that Mrs. Trinz was the owner of the car at the time of the accident. It is significant that each of the Trinzes filed a special plea of nonownership and control of the automobile. The jury were fully warranted in finding from the evidence that the Trinzes were joint owners of the car, that each had some interest in it. Defendants argue that even .if it be found that the Trinzes were both owners of the car, nevertheless, Mrs. Trinz was not in the car at the time that her husband picked up Smith at the garage, and did not participate in the trip, and therefore, as the car was being used by Trinz for purposes of his own, Mrs. Trinz could not be held responsible for the accident, as the chauffeur was not her agent. It is a sufficient answer to this contention to say that Trinz testified, upon direct, that his wife was in the car with him when he left the Chateau theater and remained in the car until they reached their home, and that on their way home they stopped at the garage and tooted the horn and Smith came out and drove them to the hotel where they lived. “ Q. All right. Then what happened? A. Then we got out of the car and he took the car back to the garage.” Upon cross-examination he stated that he did not remember if his wife was in the car or not, but still later in the cross-examination the following occurred: “Q. Now, where had you been, and your wife been, that night? A. I don’t remember where we had been, but the car was in front of the theater when we went home that night.” “I may have gone to dinner with the car. We live quite a way from the garage. ’ ’ Trinz also admitted that he instructed Smith, at the garage, to drive them home, and that after they reached home he instructed Smith to take the car back to the garage. It was used that night for the benefit of both Trinzes and was returned to the garage for the benefit of Mrs. Trinz as well as Trinz’s, since she was a joint owner, of the same. She was present when her husband told Smith to return the car to the garage and made no objection to the order. Defendants’ evidence shows that on several occasions Mrs. Trinz was in the car with her husband when they stopped at the garage on their way home and got a chauffeur to drive them home and take the car back. The strained argument that Mrs. Trinz was not acquainted with any arrangement made by her husband as to the keep of the car, etc., hardly merits consideration. Defendants cite Potts v. Pardee, 220 N. Y. 431, as an authority that the owner of an automobile, even though in the car at the time, is not liable for the torts of the driver when the driver was not under the control of the owner. In Fluegel v. Coudert, 244 N. Y. 393, the court refers to the doctrine of the Potts case as “obsolete,” because.of the.passing of a statute bearing on the subject. In Gochee v. Wagner, 257 N. Y. 344, the court limits the doctrine of the Potts case to a situation where the car was being used upon the business or pleasure of the borrower. The judge who wrote the opinion in the Potts case concurred in the opinion in the Gochee case. In the latter case it appears that the wife of the owner of the car drove it on an errand for her mother; she stopped and picked up the owner, who was riding in the rear seat while they proceeded on the mother’s errand, when the accident occurred. The husband brought suit against the wife’s mother, on the ground that the driver was acting as her agent at the time, and contended that under the rule in the Potts case, he, the owner, was not liable for the accident. The court said (p. 348): “When the respondent entered the car, he regained dominion over it and the rule applicable under the statute in the absence of the owner ceased to apply. It was respondent’s car, he was present and had the legal right to control its operation, and the negligent conduct of the driver was imputable to him. The mere fact that he chose to sit on the rear, seat and refrained from directing its operation did not change his rights or limit his liability. ’ ’

Defendants complain that by certain rulings the cross-examination of plaintiff was unduly restricted. While the court sustained objections to a number of questions put to plaintiff on cross-examination, nevertheless it appears that all of the information sought to be elicited by these questions had been brought out by prior questions put to plaintiff. It is a complete answer to the instant contention to say that the subject matter covered by counsel’s question had to do with the care exercised by plaintiff while crossing the street and that the defendants, in this court, do not claim that plaintiff was guilty of contributory negligence, nor do they even claim that the driver was not guilty of wilful and wanton conduct as alleged in the third count of the amended declaration.

Defendants contend: ‘ ‘ The persistency and ingenuity of counsel for plaintiff in insisting on parading a supposed insurance feature of the case before the jury was, we contend, not only improper but reprehensible. ’ ’ By their pleas defendants denied ownership of the automobile and plaintiff was therefore required to prove that one or both of them owned the car. If ever there was a case where a plaintiff had a right, in attempting to prove ownership, to inquire into the matter of insurance upon the car, it is the instant one. There was evidence tending to show that the car had been insured by G-eneral Accident Insurance Company and that the files relating to the insurance had been turned over to Mr. Bloomingston. The latter, placed upon the stand, stood upon his privilege as an attorney and declined to answer questions relating to the policy of insurance. Plaintiff’s counsel stated to the court, in the hearing of the jury, that he wished the policy, “for the sole purpose of proving the ownership of the car at the time of the accident,” but he was unable to secure the policy or to prove in whose name it had been taken out, because of the attitude of defendants. Because of the pleadings as to nonownership filed by defendants, plaintiff had a right to prove that defendants, or one of them, had taken out a policy of insurance upon the car, as a circumstance tending to prove ownership, and the mere fact that such evidence might tend to prejudice the minds of the jury in arriving at a verdict is not sufficient ground for excluding it. (See McGovern v. Oliver, 177 N. Y. App. Div. 168, 163 N. Y. S. 275, 276; Magee v. Vaughan, 212 Fed. 278, 280; Paepke v. Stadelman, 222 Mo. App. 346, 349; Sibley v. Nason, 196 Mass. 125, 129; Laffery v. Gypsum Co., 83 Kan. 349, 362; Finkbine Lumber Co. v. Cunningham, 101 Miss. 292, 301-2; Vaughn v. William F. Davis & Sons [Mo. App.], 221 S. W. 782, 786.) In the 'argument of plaintiff’s counsel to the jury he stated: “I believe the court himself will tell you that the question of insurance and the discussion of it, and all evidence offered or attempted to be introduced in reference to it, was for the sole and only purpose of proving ownership. It obviously has no bearing on whether the driver of the car was guilty of negligence; it has. no bearing on whether Mrs. Watson was guilty of contributory negligence; it has no bearing on the subject of wilful and wanton conduct; it has nothing to do with her damages.” Defendants’ counsel also referred to the policy in his argument. Furthermore, the court instructed the jury that all evidence relating to liability insurance was offered and admitted for the sole and only purpose of proving or tending to prove the ownership of the automobile, and that “the evidence relating to the subject of insurance has no bearing whatever on the question of negligence, if any, or wilful and wanton conduct, if any, on the part of the driver of the said automobile, as charged in the plaintiff’s declaration; or contributory negligence, if any, on the part of the plaintiff; or damages, if any, sustained by the plaintiff; and in considering these questions you should dismiss from your minds entirely the subject of insurance.” Defendants contend that “improper remarks and conduct on the part of the court and by counsel for plaintiff aroused the passion and prejudice of the jury.” After reading the bill of exceptions we are surprised at the charge made against the trial court. After the court decided to hold Mrs. Trinz in the case, counsel for defendants upon a number of occasions treated the court with insolence and contempt, and the only charge that justly could be made against the trial court is that he showed extreme forbearance, indeed gentleness, toward the counsel, when he should have punished him for flagrant misconduct. It would unduly lengthen this opinion, and serve no useful purpose, to cite the instances we have found that show this attitude of counsel toward the court. We find no merit in defendants ’ instant contention.

Defendants contend that plaintiff’s instructions one and two permit the jury to find both defendants guilty, and that under the evidence only one could be found guilty. There is no merit in this contention as both properly could be found guilty under the proof. Defendants also contend that the second instruction assumes that the driver was the agent and servant of defendants. The instruction states the allegations of the third count of the amended declaration and defines the issues under that count, and while the third paragraph of the instruction is not free from criticism, nevertheless, we do not think that the giving of the same constituted serious error, especially as defendants gave several instructions based upon the theory that the driver was their agent and servant, and they are in no position, therefore, to complain of the alleged vice in plaintiff’s instruction. We find no merit in defendants’ complaint that plaintiff’s fourth instruction should not have been given because it assumes facts not warranted by any evidence.

Defendants contend that “the verdict of the jury shows passion and prejudice,” because of the amount awarded. No reference to the evidence bearing upon the injuries sustained by plaintiff is made in support of this contention. In his closing argument to the jury Mr. Bloomingston stated that “there can be no doubt that this lady was very badly hurt, and in as much as she was not herself guilty of any fault as far as the care of her injuries are concerned, it may be well granted that her injuries are as bad as the doctor says. ’ ’ At another point he speaks of the plaintiff as a woman “who is so grievously hurt.” As a result of the accident plaintiff sustained a compound fracture of the right and left thigh bones and a compound fracture of the left leg that involved both the tibia and fibula. The bones of the left leg were broken in many places and the leg was thereby distorted. She suffered a fracture of- the two rami of the pelvis and a fracture of the right scapula. A Lane plate was fastened by means of screws to the fractured portion of the right thigh bone, and a bony union was thereby obtained. The left thigh bone is bowed or curved, the fragments not having properly united. The condition is permanent unless an operation, chiseling the callous formed and shortening* up the leg so as to get fresh edges and then putting on a Lane plate and fastening the bones in position, is performed. This operation would result in shortening the leg four or five inches. The doctor testified that he had never definitely recommended such an operation. Her left leg was operated on three times and her right leg once. They dressed her legs with adhesive tape, put weights on them, and then took calipers and drove them into the left knee bone and suspended the calipers from a rod above her head. She was in that appliance for several weeks. She was compelled to lie flat on her back for eight months. She has an ankylosis of the right knee joint. She had bladder trouble which "caused considerable distress and pain. When she first left the hospital she had a Simpson splint on her left leg and used two crutches. She returned to the hospital and was again operated on. On that occasion she remained there for six months, and when she left she walked with two crutches and a brace. At the time of the trial she required the aid of one crutch. The bill of her doctor amounted to $3,000 ; the hospital charged $4 a day for hér room, and there were more than a hundred X-rays taken of plaintiff, that cost from $3 to $5 each. The damages assessed on the first trial were $42,500. It seems hardly necessary to say that the argument that the verdict on the second trial, for $28,000, shows passion and prejudice, is clearly without merit.

We have carefully considered the numerous contentions raised by defendants. The judgment in this case is a just one and it should be and it is affirmed.

Affirmed.

Sullivan, P. J., and Gridley, J., concur.

Additional Opinion Upon “Petition por Rehearing.”

In an alleged petition for rehearing filed in this cause no point is made that this court erred in any of its rulings, nor is the justness of our judgment, affirming the judgment of the superior court, questioned. We are asked “to so amend the opinion so as to make it clear to him who reads that the court did not intend to reflect on counsel’s integrity as an attorney or as a man”; “that the opinion be modified by striking therefrom remarks reflecting on his integrity.” . Counsel states: ‘ ‘ This court well knows that attorneys who represent casualty insurance companies cannot pick the client whom they defend, and having once been employed to defend them must exercise all skill and diligence they possess in behalf of the client. . . . Counsel cannot choose their clients, nor guarantee their veracity, nor can counsel neglect to present his client’s testimony merely because his testimony does not agree with that given on a previous trial. . . . Counsel was placed in a somewhat difficult position, and it may well be that his first duty is to his client and that he should take his steps according to the evidence as it was and not according to what he knows may later develop in the evidence”; that “counsel for defendant . . could not guarantee his client or his client’s veracity, and if the defense was tricky or dishonest, was not responsible for it, he having no alternative but to take the evidence as he found it and present it to the court and jury, as required by the duty of an attorney to his client”; that “unless counsel was responsible for defendant Edward Trinz’s testimony, that is, unless he suborned the testimony, the reference to clean hands cannot surely refer to him, nor can the characterization of a shifty and tricky defense be referred to him.” Counsel argues that even if the court had not retracted his instruction to find Mrs. Trinz not guilty, nevertheless, “the plaintiff would not have lost her suit, but would merely have been required to try the case again. The court had the power to see that there was no miscarriage of justice and could have exercised his right to grant a new trial, had there been an obvious failure of justice in the case.” In our opinion it would have been a miscarriage of justice had the trial court not retained Mrs. Trinz in the case. Counsel assumes that plaintiff, at the close of her case, had failed to make out a prima facie case as to Mrs. Trinz and contends that in that state of the record he owed no duty to inform the court that the defendant Edward Trinz intended to change the testimony he gave at the former trial. As we stated in our opinion, the “plaintiff, at the close of her case, had made out a prima facie case of ownership of the car against Mrs. Trinz”; that the presumption of ownership was established by the introduction of the certificate of the Secretary of State to the effect that the license for the automobile for the year 1928 was issued, at her request, to her, and that in the application for the license she had sworn that she purchased the car on April 15, 1926, and was the owner of it; but, as we also stated in our opinion, the ' action of the court in giving the oral instruction to the jury, notwithstanding the fact that the plaintiff had made out a prima facie case, was based, apparently, upon the assumption “that the defense was acting in good faith with the court as to the ownership of the car,” and “that it would be useless, in view of what we said in our former opinion, to retain Rosalie Trinz in the case. ’ ’ Certainly, under such circumstances, connsel, an officer of the court, owed a duty to be fair and frank with the court.

It would seem hardly necessary for us to state that we do not agree with counsel’s argument that unless he suborned the testimony of Trinz it was his duty to present the evidence, even “if the defense was tricky or dishonest.”

After a very careful re-examination of the language of our opinion, in the light of the record, and after an earnest consideration of counsel’s request, we see no good reason why any language contained in the opinion should he modified. The so-called petition for a rehearing is denied.

Petition for rehearing denied.

Sullivan, P. J., and Gridley, J., concur.


author: Mr. Justice Hebel

text:
    Consolidated Coal Company of St. Louis, Appellant, v. Flynn Coal Company et al., Appellees.
    Gen. No. 36,655.

      Opinion filed March 14, 1934.
    Heard in the third division of this court for the first district at the April term, 1933.
    Rehearing denied March 30, 1934, and opinion modified April 12, 1934.
    Abraham Redman and Whitnel & Browning, for appellant.
    Miller, Gorham, Wales & Adams, for certain appellee; Charles J. Tressler, of counsel.
   Mr. Justice Hebel

delivered the opinion of the court.

This is an appeal by the complainant from an order denying leave to file an amended bill of complaint and dismissing the cause for want of equity.

It appears from the bill of complaint that the original bill was filed on October 2, 1928, and that this bill was dismissed on October 30, 1931, for want of prosecution ; that on December 21, 1931, the bill of complaint in the instant case was filed.

The bill of complaint charges that" the original bill prays for an accounting as to the claim of the complainant against the defendants named, and as to the property and assets of the Flynn Coal Company; that all transfers of property of said company not made in good faith be set aside, and the property applied in payment of the amount due complainant, and that the individual defendant be held liable for unpaid stock liabilities and for assenting to an indebtedness in excess of the capital stock of the corporation. The bill further charges that the defendant, Flynn Coal Company, an Illinois corporation, was indebted to the complainant in the sum of $186,118.90 for coal sold and delivered by the complainant at various times commencing December, 1924, and ending October 1, 1925, and that for this coal so delivered no payments had been made.

It further appears that on October 26, 1922, the capital stock of the corporation was increased and 6,490 shares of no par common stock were issued and that the consideration for the issuance of such stock was the cash on hand, accounts receivable, trucks, leases, good will, contracts, and other property located at the place of business of the corporation, and that the value placed upon such assets taken in payment of the capital stock of the Flynn Coal Company, was $649,000. It is charged that on October 4, 1926, a decree of dissolution was entered in the circuit court of Cook county, dissolving the Flynn Coal Company for failure to pay its franchise taxes. It also appears that on January 9, 1926, defendants Mortimer B. Flynn, J. B. Troutman and T. C. Fredrich organized a corporation known as the Flynn Fuel Company; that this business was transacted by Mortimer B. Flynn and J. B. Trout-man, and all of the property of the Flynn Coal Company was transferred either to the new corporation or was retained by said Mortimer B. Flynn and J. B. Troutman, and that others, whose names are unknown, converted all the property of the Flynn Coal Company to their own use, or transferred it to the new corporation; that the value of $649,000 placed upon the assets of the Flynn Coal Company for which stock was issued was excessive; that the actual value was not in excess of $150,000, and for that reason the stockholders are liable for the unpaid portion of their stock; that J. R. Troutman and Mortimer B. Flynn were directors of the corporation during the time the debt above mentioned accrued and that the defendants Mortimer B. Flynn and J. R. Troutman assented to an indebtedness in excess of the capital stock of the corporation, and therefore are personally and individually liable to the extent of such excess, according to section 23 of the Corporation Act, Cahill’s St. ch. 32, If 23.

The bill prayed for the appointment- of a receiver, for an accounting in the transfer of the property from the Flynn Coal Company to the Flynn Fuel Company, and that the individual defendants be held liable for unpaid stock subscriptions, and to account for all property of the Flynn Coal Company received by the defendants. Summons was issued to be served on all the defendants at the time of the filing of the original bill. This summons was returned on January 18, 1932, marked “Defendants not found.” An alias summons was thereupon issued, and on January 27, 1932, it appears that service was had on the Flynn Coal Company, by delivering a copy to J. R. Troutman, director and agent and on J. R. Troutman individually, and that the other defendants named in the alias summons were not found.

To this bill, the defendant J. R. Troutman filed a demurrer, which was sustained, on the ground that section 79 of the Corporation Act, Cahill’s St. ch. 32, If 79, in force at the time the order was entered, was an absolute and unqualified limitation upon the right of the complainant to institute the pending suit, and at the same time, the court sustained the motion of J. R. Troutman to quash service of summons on the Flynn Coal Company.

The complainant thereupon made its motion for leave to file an amended bill of complaint and tendered and presented to the court a proposed amended bill of complaint. The proposed bill of complaint sets out, substantially, the same facts as appear in the bill of complaint heretofore referred to, and, in addition, that Mortimer B. Flynn, as president of the corporation, drew a salary for the years from 1922 to 1928, at the rate of $36,000 a year, whereas a reasonable' value of the services rendered by him would not exceed $12,000. It is also charged that since the filing of the original bill, an investigation of the purported dissolution of the Flynn Coal Company disclosed that service of summons in that case was attempted on the defendants by publication, but that the publication did not comply with the statute, therefore the court lacked jurisdiction, and its decree is void and the Flynn Coal Company was not in fact dissolved.

The complainant contends that the original bill of complaint stated a good cause of action and is not subject to section 79 of the Corporation Act. Section 79 of the Corporation Act (Cahill’s Ill. Rev. St. 1929, ch. 32, 1J79) is as follows:

“The dissolution for any cause whatever of any corporation shall not take away or impair any remedy given against such corporation, its officers or stockholders, for any liabilities incurred previous to its dissolution, if suit therefor is brought, and service of process had within two years after such dissolution.”

The bill of complaint on its face shows that the original suit was instituted and summons issued within two years after the alleged dissolution of the Flynn Coal Company, which suit was dismissed for want of prosecution. The bill now under consideration was filed within one year from the time the suit was dismissed for want of prosecution, and the position of the complainant is that by par. 26 of Cahill’s St. ch. 83, entitled, “Limitations,” a litigant whose cause has been dismissed for want of prosecution, under the terms of this statute, is given an additional year to commence a new action. The section of the statute providing this additional time is in part as follows:

“. . .if the plaintiff be nonsuited, then if the time limited for bringing such action shall have expired during the pendency of such suit, the said plaintiff, his or her heirs, executors or administrators, as the case shall require, may commence a new action within one year after such judgment reversed or given against the plaintiff, and not after.”

The complainant urges this point: That the fraudulent conversion, or the fraudulent conduct of the defendants in the transfer of the corporation property existed separate and independent of the Corporation Act, and that its action was not controlled by section 79 of that act. The court will comment upon this suggestion further on in this opinion. The corporation in question was granted certain power and was controlled by the several sections of the Corporation Act. The several remedies provided for and granted were limited by the acts of the legislature in the granting of time within which a dissolved corporation may be sued by a person, firm or corporation.

The complainant in this case is chargeable with knowledge of the statutory law governing the organization and conduct of the defendant’s business and the remedies provided for a violation of the provisions of the Corporation Act by its officers. Complainant’s right to maintain an action under the act is limited by the statute, and unless the complainant has instituted this action within the time limited, its right of action is lost. From the facts charged in the bill of complaint it is clear that the bill was filed for the purpose of enforcing stockholders’ liability, and liability of the directors for assenting to an excessive indebtedness, and such is the specific relief prayed for against Mortimer B. Flynn and J. R. Trontman, defendants.

There is no dispute that by the common law doctrine of the status of a corporation after its dissolution for any cause, the corporation has no legal existence, and the real estate held by the dissolved corporation reverts to the grantors or donors, and the personal property escheats to the king, and that no right of action can be maintained to enforce a claim against a defunct corporation. In the United States, however, this common law doctrine has been so modified that the property of a dissolved corporation is to be used for the benefit of the creditors and stockholders after dissolution, and generally, by a saving clause, stockholders or creditors may maintain an action for that purpose, and in order to maintain an action it must be filed within the time fixed for such purpose. In the instant case, by the saving clause, complainant was granted statutory right to maintain an action of the character before this court.

This litigation has been pending for a long period of time. The claim of the complainant consists of several items for coal sold and delivered to the dissolved corporation, the last of which is dated October 1, 1925. The original bill was filed on October 2, 1928, two days short of the two-year limitation after the dissolution of the Flynn Coal Company as a corporation. Thereafter, as we have already indicated in this opinion, the cause when reached for trial was dismissed for want of prosecution, and on December 21, 1931, the bill in the instant case was filed, which was within one year after the involuntary dismissal. The right to maintain this action is wholly statutory, and must be exercised within the statutory time fixed by the legislature, but for this provision the complainant could not maintain an action for relief such as prayed for in the bill. The present bill of complaint was not filed within the time provided for by sec. 79 of the Corporation Act, and sec. 2 of chap. 83 of the Statute of Limitations does not apply, Dukes v. Harrison & Reidy, 270 Ill. App. 372, and the court properly sustained the demurrer of the defendant J. ft. Troutman.

The complainant contends that the chancellor erred in refusing to permit the filing of its amended bill of complaint, and that the amended bill charges facts of such a grave character as to clearly warrant the various forms of equitable relief prayed for, irrespective of whether or not the Flynn Coal Company was dissolved. The complainant further suggests that the property of the dissolved corporation was converted by certain of the defendants in the instant case, and therefore fraud is charged, and in equity where proper charges are made in the bill, the officers are held to be trustees, holding the corporate property for the benefit of the interested parties. This position of the complainant is not questioned by the defendants, except that the right to act is limited, and must be exercised within the time fixed by the Corporation Act. However, this court being of the opinion that the bill in question was not filed within the time fixed by the statute, this applies to the remedy to enforce statutory liabilities; We are not disposed to hold that in a proper case where the officers of a defunct corporation by fraudulent conduct conceal and convert corporate property, a bill to account is required to be filed within the two years provided for by the Corporation Act after dissolution, but that the complainant urging such right may compel the officers who by fraudulent conduct convert the assets of a corporation, to account within the limitation period of five years, as provided for by the statute of limitations.

In the proposed amended bill, the facts indicate that the right of action accrued on the date of the last item appearing on the bill, being October 1,1925. The time that elapsed between this date and January 14, 1932,' the date of the motion made by the complainant for leave to file an amended bill of complaint was more than five years after the right of action accrued, and this appears from the proposed bill of complaint in which it is charged that the total amount represents the amount due on an account stated for said coal on October 1, 1925, and the bill includes all of the defendants as having acknowledged the correctness of the indebtedness on that date and promised to pay the same on the date above mentioned. As to one of the defendants, the Flynn Coal Company, it was not in existence on the date as charged, but was organized as an Illinois corporation on January 9, 1926. The element of time appears on the face of the proposed amended bill, and being a new suit the court did not err in denying the complainant’s motion, for leave to file the proposed bill of complaint. We have considered the objection that the Flynn Coal Company was never legally dissolved for the reason that the decree purporting to dissolve it was invalid, due to the lack of jurisdiction because of a defective proof of publication. The certificate recites that the Corporation Reporter is a secular newspaper of general circulation, and seems to meet the requirement of the statute, and recites the further fact that the “Corporation Reporter” has been published weekly in the City of Chicago, County of Cook and State of Illinois, and had been published regularly for more than six months prior to the first publication of the notice.

For the reasons stated, this court is of the opinion that the order dismissing the bill for want of equity and denying leave to file the proposed bill of complaint must be sustained.

The decree is affirmed.

Decree affirmed.

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