author: Mr. Justice Gridley

text:
    Frank K. Prohaska, Appellant, v. The Hemmer-Miller Development Company and John G. Hemmer, Appellees.
    Gen. No. 33,703.

      Opinion filed March 11, 1930.
    Rehearing denied March 24, 1930.
    Solberg, Hummeland & Winans, for appellant; Kellam Foster, of counsel.
    Church, McMurdy, Harpel & Wagner, for appellees; Robert"McMurdy and Howard M. Harpel, of counsel.
   Mr. Justice Gridley

delivered the opinion of the court.

In an action in assumpsit, commenced September-17, 1928, against The Hemmer-Miller Development Company (a South Dakota corporation), John G. Hemmer, its president, and Kirk S. Miller, its treasurer, the company and Hemmer were served with process, but Miller was not served. The company had an office at 35 South Dearborn Street, Chicago, and plaintiff, a resident of Chicago, sought to recover, by virtue of the provisions of section 37 and other sections, of the Illinois Securities Law (Cahill’s St. 1923, ch. 32, ¶ 290, p. 926), certain moneys which he had paid to the company, in accordance with a certain written agreement executed at Chicago, and also attorney’s fees. Plaintiff’s declaration consisted of two special counts and the consolidated common counts, which last mentioned counts subsequently were withdrawn. The company and Hemmer filed a general and special demurrer to the special counts. On July 8, 1929, after arguments, the court sustained the demurrer and, upon plaintiff’s election to stand by the counts, entered judgment against plaintiff for costs and this appeal followed.

The written agreement, set forth in full in each count, is on a printed form with the blanks filled in by writing or typewriting, and it has an attached rider. After stating that the agreement, dated March 25, 1925, is made between the development company, first party, and Frank K. Prohaska, of 2216 South Kirkland Avenue, Chicago, second party, it is provided that, if Prohaska shall first make the payments and perform the covenants on his part, the company “hereby covenants and agrees to convey and assure to him, in fee simple, clear of all incumbrances, by a good and sufficient Warranty Deed, the lot—piece—or parcel—of ground situated in the County of Fall Eiver and State of South Dakota, known and described as the East Half (%) of the Northeast Quarter (%) of Section twenty-nine (29) in Township eleven (11), South of Eange Four (4), East of the Black Hills Meridian.”

It is further provided that Prohaska “hereby covenants and agrees to pay to the Company the sum of $8,000, one third ($2,666.66) in cash, and the balance as hereinafter provided in the rider attached hereto with interest at the rate of 5 per cent per annum, payable annually, on the whole sum remaining from time to time unpaid, and to pay all taxes, assessments or impositions that may legally be levied or imposed upon said land, subsequent to the year 1924.”

It is further provided that, in case of Prohaska’s failure to make “either” of the payments or any part thereof or perform any of his covenants, this contract shall at the option of the company be forfeited and determined, and Prohaska shall forfeit all payments made by him and the same shall be retained by the company in full satisfaction and in liquidation of all damages by it sustained, and it shall have the right to re-enter and take possession of the premises, etc.

It is further provided that, “upon the completion of this agreement, the Company agrees to deliver to the purchasers a good and sufficient warranty deed free and clear from all incumbrances, except the taxes, assessments and impositions which the purchasers have herein agreed to pay”; that the “time of payment shall be the essence of this contract”; and that all covenants and agreements shall extend to and be obligatory upon the heirs, executors, administrators and assigns of the respective parties, etc. The attached rider is as follows :

“It Is Agreed that the Company shall harvest all crops upon said land during the life of this agreement and the net profit therefrom shall be applied to the purchase price of the land and interest.
“The Company agrees during the calendar years 1925 and 1926 to break, seed, cut and thresh and pay for all labor without cost to the purchasers; seeding to be Grimm Certified Alfalfa seed.
“The purchasers agree to pay the expense of all hail insurance during the life of this contract, and in case of loss, the same shall be applied to the purchase price of the property.
“This contract is not transferable without the written consent of the Company.”

The agreement is signed by Prohaska and by the company, by Hemmer, its president and by Miller, its treasurer, and it is duly acknowledged by both parties before a notary public of Cook county, Illinois.

In the first count of plaintiff’s declaration it is alleged that at the time of execution of the agreement “and at divers times thereafter,” in accordance with its terms, plaintiff paid to the company the total sum of $3171.18; that “said agreement was a security in Class G,” under the statute known as the Illinois Securities Law, Cahill’s St. ch. 32, ¶ 254 et seq.; that prior to the execution of the agreement the company had not filed in the office of the Secretary of State of Illinois “the statements, documents or instruments specified in and required by section 7 of said statute” to be there filed; that “said agreement was made in violation of the provisions of said Illinois Securities Law”; that plaintiff, as purchaser under the agreement, “has elected and elects to declare the same null and void and herewith brings into court and tenders to the defendant Company said agreement”; and that by means thereof the defendant company has become liable to pay plaintiff said sum of $3171.18, etc.

In the second count the allegations are substantially the same, except that it is alleged that “said agreement was a security in Class D” under said Securities Law, and that prior to the execution of the agreement the company had not filed in the office of said Secretary of State “the statements, documents or instruments specified in and required by section 9 of said statute” to be there filed.

It appears from a bill of exceptions, certified by the trial judge, that on the hearing on defendants’ demurrer the court held that the contract, as set forth in the counts, “is not an investment contract within the Illinois Securities Law. ’ ’

Counsel for plaintiff here contend that the court erred (1) in holding that said contract is not an investment contract within said Securities Law, (2) in sustaining the demurrer to the counts, and (3) in entering judgment against plaintiff. The main contention of defendants’ counsel is that the trial court properly sustained defendants’ demurrer because the Illinois Securities Law does not apply to a sale, or a contract for sale, of land, such as is here involved.

The title of said Illinois Securities Law, in force when said contract was executed, is “An Act relating to the sale or other disposition of securities and providing penalties for the violation thereof and to repeal Acts in conflict therewith.” In section 2 of the act it is provided (Cahill’s St. 1923, ch. 32, ¶255, p. 916):

“The word ‘securities’ shall mean and include stock, treasury stock, bonds, debentures, investment contracts, notes, evidences of indebtedness, participation certificates, certificates of shares or interest, preorganization certificates and subscriptions, certificates evidencing shares of or interest in trust estates or associations, profit sharing agreements or certificates; or any certificate, contract or instrument whatsoever, representing or constituting evidence of, or secured by, title to or interest in, or any lien or charge upon, the capital or any property or assets of the issuer thereof, and any oil, gas o'r mining lease, and interests, units or shares in any such lease or leases.”

In 37 Corpus Juris p. 275 it is said:

“The term ‘securities,’ as used in these laws (Blue Sky Laws), means written assurances for the return or payment of money, except where special definitions are given by the statutes. ... It means the investment of funds in a designated portion of the assets and capital of a concern, with a view of receiving a profit through the efforts of others than the investor; and in this sense includes what are termed ‘security’ or ‘investment’ contracts or ‘speculative securities’.” (See State v. Whiteaker, 118 Ore. 656, 660.)

As to the term “investment contract,” which appears in said section 2 of the Illinois Act, it is said in State v. Gopher Tire & Rubber Co., 146 Minn. 52, 56:

“No case has been called to our attention defining the term ‘investment contract.’ The placing of capital or laying out of money in a way intended to secure income or profit from its employment is an investment as that word is commonly used and understood.”

In State v. Evans, 154 Minn. 95, 101, it is said:

“The term ‘securities’ is a more inclusive term than ‘investment contracts.’ It means ‘evidences of debt or of property,’ and includes all evidences of investment calling for a return in the form of income or profit.”

In section 3 of the Illinois Act it is provided:

“For the purposes of this Act securities are divided into four classes, as follows:
“ (1) Securities, the inherent qualities of which assure their sale and disposition without the perpetration of fraud, which shall be known as securities in Class ‘A’;
“(2) Securities, the inherent qualities of which, or in the nature of one or both parties to the sale thereof, assure their sale and disposition without the perpetration of fraud, which shall be known as securities in Class ‘B’;
“ (3) Securities based on established income, which shall be known as securities in Class ‘C’;
“ (4) Securities based on prospective income, which shall be known as securities in Class ‘D’.”

In section 6 of the act it is stated what securities are comprised in class “C”, and in section 8 it is stated that “all securities other than those falling within Class ‘A’, ‘B’, and ‘C’, respectively, shall be known as securities in Class ‘D’.” In section 7 are stated the regulations and requirements under and by which securities of class “C” may be sold or offered for sale, which include the filing of certain statements and instruments in the office of the Secretary of State of Illinois, and in section 9 are stated what statements and documents must be filed in said office before any security of Class “D”- shall be sold, or offered for sale, In section 37 of the act it is provided (Cahill’s St. 1923, ch. 32, ¶ 290, p. 926):

“ (1) Every sale and contract of sale made in violation of any of the provisions of this Act shall be void at the election of the purchaser, and the seller of the securities so sold, the officers and directors of the seller, and each and every solicitor, agent or broker of or for such seller, who shall have knowingly performed any act or in any way furthered such sale, shall be jointly and severally liable, in an action at law or in equity, upon tender to the seller or in court of the securities sold, to the purchaser for the amount paid, the consideration given or the value thereof, together with his reasonable attorney’s fees in any action brought for such recovery.” . . .

We are of the opinion (contrary to the holding of the trial court) that the contract in question should be considered as an “investment contract,” and also as a “security” as defined in section 2 of the Illinois Securities Act. By the terms of the contract the company is to convey the land described to plaintiff on receipt by it of $8,000, one third of which sum ($2,666.66) plaintiff is to pay in cash. He does not promise to pay the balance ($5,333.34) at any time out of his own funds, and, indeed, there is no provision allowing him to pay any part thereof out of his own funds. Said balance can only be paid as provided “in the rider attached hereto,” and from the rider it appears that “the company agrees during the calendar years 1925 and 1926 to break, seed, cut and thresh and pay for all labor without cost to the purchasers,”— using a certain mentioned alfalfa seed, and that “the Company shall harvest all crops upon said land during the life of this agreement and the net profits therefrom shall be applied to the purchase price of the land and interest.” What the life of the agreement may be depends upon the net profit from said crops in the first and succeeding years. In the meantime plaintiff is to be charged interest at 5 per cent per annum on said balance or whatever part thereof remains from time to time unpaid, and is also to pay all taxes, etc., levied upon the land, and also the expense of hail insurance. It was presumably in the minds of both parties that plaintiff was to ultimately get good title to the land, possibly worth $8,000, upon his making the initial payment of one-third of that amount and other payments for interest, taxes, hail insurance, etc.,—the other two-thirds of said amount to be realized from the crops raised upon the land under the sole control of the company. The contract discloses a highly speculative investment, or gamble, on plaintiff’s part. If the crops for the years 1925 and 1926 should be sufficiently large to pay or liquidate said balance of $5,333.34, accrued interest, taxes, etc., plaintiff would presumably make a large profit, but if the crops should be small or unprofitable in the years 1925 and 1926 and in the succeeding years, it is apparent that it would be to plaintiff’s financial advantage to cease planting any crops and to cease paying the taxes, etc., in which event the company could forfeit the contract, and plaintiff would lose said initial payment and all subsequent disbursements.

As to the contention of defendants’ counsel (that defendants’ demurrer was properly sustained because the Illinois Securities Law is not applicable to a contract for the sale of land such as the present one), no case is cited by them in support of the contention. By section 2 of the Illinois Act (above set forth) the word “securities” means and includes not only “investment contracts,” but also “any certificate, contract or instrument whatsoever, representing or constituting evidence of, or secured by, title to or interest in, . . . the capital or any property or assets of.the issuer thereof. ” And we are of the opinion that the language of this section is sufficiently broad so as to include as a “security” the contract in question, and, it being admitted by the demurrer that the company had not complied with the provisions of sections 7 and 9 of the Act relative to the filing of statements and documents in the office of the Secretary of State, we think, in view of the further provision in section 37 (above set forth) of the Act, that the court erred in sustaining the demurrer. In other States there are a few decisions, under similar “Blue Sky Laws,” which may be referred to.

In State v. Evans, 154 Minn. 95, defendants were indicted, charged with the crime of selling an “investment contract” without a license. Their demurrer to the indictment was overruled by the district court and on certification to the Supreme Court the action of the district court was affirmed. The Minnesota statute made it an offense for any person to “sell or offer for sale any of the stocks, bonds, investment contracts or other securities . . . issued by an investment company” (except certain securities specifically exempted) without a license from the State Securities Commission. The indictment alleged that the U. S. I. Realty Company, incorporated in Minnesota, was engaged in the business of selling investment contracts issued by it, and that on June 6, 1921, without a license, defendants sold to one Clary an investment contract which had been issued by the company. The contract was set out in full in the indictment, and by its terms the company, in consideration of the payment of a contract fee of $25 and “of the covenants and agreements herein contained, ’ ’ agreed to sell to Clary certain land in the state of Texas for $2,500, payable in monthly instalments of $25 each. The Minnesota court, in commenting upon the contract, said (p. 97): “There is no express obligation on the part of Clary to pay or to buy. There are none of the usual provisions for furnishing an abstract of title or for examination of title.” In these particulars it is similar to the present contract, in which, as above shown, plaintiff was not re quired to pay said balance of $5,333.34, but the same was only to be paid out of the net profits from the crops of the land, which during the life of the contract the company only was to harvest. The Minnesota court, after further commenting upon certain options, privileges and conditions contained in the printed portions of the contract, further said (p. 100): “We are of the opinion that this contract is an investment contract within the statute.” This decision is cited with approval in the case of Vercellini v. U. S. I. Realty Co., 158 Minn. 72, where it was decided that the purchaser of an investment contract issued and sold in violation of the “Blue Sky Law” is not in pari delicto with the seller and may recover from him all the money he paid under the contract,—the court saying (p. 74): “Blue Sky laws are intended to protect one class of individuals from the imposition of another class. The only guilty party is the seller of a security sold in violation of the statute.” (See, also, Webster v. U. S. I. Realty Co., 170 Minn. 360, 362.)

In Kerst v. Nelson, 171 Minn. 191, complainants, doing business in Minnesota as a land company, filed a bill in the district court of Hennepin county to restrain defendants, certain State officials, from interfering with the making of certain investment contracts as to land located in Riverside county, California, which contracts defendants claimed were in violation of the “Blue Sky Law” of Minnesota. The demurrer of the defendants to the bill was sustained by the district court and on appeal to the' Supreme Court the order was affirmed. Complainants alleged that they were selling the California land, which they owned or in which they had an interest; that the land was to be used as a vineyard, and that they had a contract with Rogers and company for its cultivation, which contract was assignable in whole or in part to purchasers; that complainants intended to cause Rogers and Company to execute new'contracts with purchasers; that defendants had informed complainants that they could not make such sales in Mimiesota without complying with the requirements of the Blue Sky Law, and had threatened to prosecute them; and that defendants should perpetually be enjoined, etc. The form of contract (made a part of the bill) to be issued to purchasers provided that the buyer should be entitled to the use and possession of the land, subject to certain reservations and restrictions mentioned, and that if the buyer elected to take possession, the seller was to continue to cultivate the vineyard and harvest and market the crops upon the same terms and conditions as if the buyer had not taken possession. A trustee was named to receive and disburse money collected for the crops produced, and they were to be marketed in such manner and at such prices as the seller in his discretion should deem advisable. After deducting the cost of delivering and collecting, the balance was “to be divided one-half to the seller and one-half to the buyer.” If the fund was not sufficient to cover the expenses, the deficit should be made up by the seller provided the buyer was not in default. During the life of the contract, the seller’s, agricultural experts should have the exclusive control and management of planting, cultivating and caring for the land, and after the termination of the contract, should the buyer so elect, the seller would continue to cultivate, harvest and market the crops for an additional period of time1 upon such terms as might mutually be agreed. It was further provided that the contract could not be assigned without the written consent of the seller. It •will be noticed that the contract is similar in its provisions to those mentioned in the rider of the contract now in question, as regards the control by the seller of the harvesting and marketing of the crops and the inability of the buyer to assign the contract without the seller’s written consent. It was contended in the Minnesota court, as also here in substance contended, that the contract was “nothing more nor less than one for the sale of land and hence not within the purview of the Blue Sky Law.” But the Minnesota court (citing the Evans case, 154 Minn. 95, and State v. Agey, 171 N. C. 831 and other authorities) disagreed with the contention, saying (p. 195) “in our own decisions we have said that the purpose of the statute is to prevent offers to the public of investment contracts evidencing a right to participate in the proceeds of a venture before the securities commission ascertains where there is something tangible behind it. This is such a venture and should pass inspection by the commission before the public is solicited to invest money in the contract appellants propose to sell.” In discussing the further contention of complainants (also made by defendants in the present case) that Blue Sky Laws being penal in their nature should be strictly construed, the Minnesota court held in effect that such laws, considering the evil to be remedied, should not be given a narrow construction, saying (p. 195):

“In view of the ingenuity of those who seek to induce men and women to put their money into far-off speculative enterprises over which the investor has little or no control, and in view of the paternalistic character of blue sky laws, it should be the policy of the courts to refrain from hampering the State officials in the performance of their duties by placing a narrow construction on such laws. This enterprise is within the spirit of the law as wéll as the letter, and we hold that appellants had no right to injunctive relief.”

In State v. Agey, 171 N. C. 831, defendant, an agent of a Tennessee corporation which had purchased large tracts of land in Tatnall county Georgia, was engaged in North Carolina in making sales of small portions of the land under written contracts signed by numerous purchasers. He was indicted and convicted for violation of the “Blue Sky Law” of North Carolina, it appearing that the company had not been licensed, etc. in that State. On appeal the conviction was affirmed. One of the questions raised in the Supreme Court was whether the making of the contracts for the sales came within the purview of the statute, and that question after a lengthy discussion was decided in the affirmative. The statute forbade the sale or negotiation in the State without a license of any bonds, stock, investment contracts, “evidences of property,” etc., of a foreign corporation. The contract made with a purchaser provided that the company would sell to him a tract of land of about one and one-fourth acres for a fig orchard for $600—$120 to be paid down in cash and the balance over a term of years, and that the company would set out certain fig cuttings and cultivate, prune and take care of the bushes for 5 years, with a certain indefinite guarantee as to the quantity of the bushes at the end of the period. Title in the tract was to remain in the company until the purchase money was fully paid. At the close of the court’s opinion it is said (p. 836):

“Whether the scheme under which the defendant was acting* offers any probability of realizing the promises made for. the Company, or whether there is any bona fides, the outline which has been given does not give much assurance. But, however this may be, the State has a right to require that when such propositions are offered to our people there shall be an investigation as to the reliability of the company, the character of its promoters and managers, and the nature of its business and the amount of its assets, and that it shall not offer its stock, its investments, its ‘ evidences of property, ’ until the Insurance Commissioner has examined into its reliability and assets and issued license to such company to do business in this State. The company which the defendant purports to represent has not done this, and he has been properly found guilty.”

In the recent case of Dobal v. Guardian Finance Corp., 251 Ill. App. 220, decided by the first division of the Appellate Court of this district, plaintiff sued defendants to recover back certain sums of money paid by her to them under the terms of a certain agreement concerning the purchase of certain junior mortgage bonds secured on real estate in Illinois. On the theory that there had been violations of the Illinois Securities Act the trial court instructed the jury to return a verdict in her favor for $1,475, and entered judgment in that amount against defendants. In affirming the judgment the court held (p. 224) that “the agreement was in the nature of an investment contract and subject to the provisions of the Illinois Securities Act” and (p. 226) that “plaintiff’s right of property was in her investment contract and not in the bonds.”

In view of the allegations in plaintiff’s special counts, the provisions of the contract between the parties and the holdings and decisions above outlined, our conclusion is that the superior court erred in sustaining defendants ’ demurrer to said counts and in entering the judgment appealed from. Accordingly the judgment is reversed and the cause remanded.

Reversed and remanded.

Barnes, P. J., and Scanlan, J., concur.


source: Caselaw Access Project

author: Mr. Justice G-ridley

license: Public Domain

text:
    Sonea Koplen Cohen, Plaintiff in Error, v. New York Life Insurance Company, Defendant in Error.
    Gen. No. 33,763.

      Opinion filed March 11, 1930.
    Aaron Soble, for plaintiff in error.
    Hamlin, Topliee & Cooper and Louis H. Cooke, for defendant in error; Homer H. Cooper and Wendell J. Brown, of counsel.
   Mr. Justice G-ridley

delivered the opinion of the court.

On June 21, 1927, Sonea Koplen, widow of Samuel Koplen and the beneficiary named in defendant’s policy insuring his life, commenced a first class action in the municipal court of Chicago against defendant to recover the face amount of the policy, $3,000. On the eve of the trial, she having remarried, her name as plaintiff was changed accordingly. On the trial before a jury considerable evidence was introduced by both parties, and at the conclusion of all the evidence the court, on June 4, 1929, directed the jury to return a verdict in defendant’s favor, and, upon this being done, entered a judgment against plaintiff for costs, which judgment she seeks by this writ of error to reverse.

On May 5,1924, the insured made written application for the policy through an agent (one Block) of defendant in Chicago. On May 26, 1924, defendant’s medical examiner, Dr. Eberhardt, examined him at his home in Chicago and wrote in his answers to the questions in “Part II” of the application. He was a native of Bussia, was 30 years of age, had attended school in Chicago, could read and write the English language, and was the proprietor of a barber shop business at No. 57 East Jackson Boulevard, Chicago. The application was forwarded to defendant’s home office in New York and there examined, and, under date of June 2, 1924, the policy to which was attached a photographic copy of the application, was in turn forwarded to defendant’s Chicago office. On June 23, 1924, upon payment through defendant’s agent (Block) of the first premium of $81.27, the policy was delivered to the insured. He died at the Michael Beese Hospital in Chicago on January 12, 1925, within one year after the date of the policy. Among its provisions are the following :

“The Policy and the application therefor, copy of which is attached hereto, constitute the entire contract. All statements made by the insured shall, in absence of fraud, be deemed representations and not warranties, and no such statement shall avoid the Policy or be used in defense of a claim under it, unless it is contained in the written application and a copy of the application is endorsed upon or attached to this Policy when issued. . . . This Policy shall be incontestable after two years from its date of issue except for nonpayment of premium,” etc.

Part II of the application is headed “Answers to the Medical Examiner.” Then follow numerous questions and answers thereto respectively. And there are the following questions and answers:

“7. B. Have you been under observation or treatment in any hospital, asylum or sanitarium? (Answer) No.
“8. C. Have you consulted a physician or suffered from any ailment or disease of the stomach or intestines, liver, kidneys or bladder? (Answer) No.
“10. Have you consulted a physician for any ailment or disease not included in your above answers? (Answer) No.
“11. What physician or physicians, if any, not named above, have you consulted or been examined or treated by within the past five years? (Answer) None consulted.

The insured’s signature appears at the bottom of Part II of the application and is witnessed by said medical examiner. Above the insured’s signature is the following:

“On behalf of myself and of every person who shall have or claim any interest in any insurance made hereunder, I declare that I have carefully read each and all of the above answers, that they are each written as made by me, and each of them is full, complete and true, and agree that the company believing them to be true'shall rely and act upon them.”

In plaintiff’s statement of claim she alleged the execution and delivery of the policy (copy attached and made a part of the statement), the death of the insured and the furnishing to defendant on January 28,1925, of proofs of death (copies, attached and made a part of the statement); and further alleged that the insured during his lifetime “did keep, perform and comply with all the terms, conditions, and provisions of said policy upon his part to be kept and performed”; that plaintiff at all times since the insured’s death has likewise kept and performed all the terms and conditions upon her part to be kept and performed; that defendant although often requested has refused to pay to her as beneficiary the amount of the policy, $3,000, and that it is liable to her for such amount together with interest.

In defendant’s affidavit of merits it is alleged that “the execution and delivery of said policy was induced by fraudulent misrepresentations as to material matters by said Samuel Koplen as applicant, and that defendant, upon discovery of the fraud, elected to and did disaffirm and rescind said policy in apt time and manner.” And it is further alleged in substance that on May 26, 1924, Part II of the application was signed by the applicant in the presence of the medical examiner; that relying upon the applicant’s statements therein defendant issued the policy; that after the insured’s death defendant made investigation and ascertained that certain statements in the application (setting forth in full the questions and answers above mentioned) were “false, incomplete and fraudulent”; that in truth and in fact the insured, prior to May 26, 1924, had long been suffering with ailments and diseases of the stomach; that on January 8, 1924, he went to the Mount Sinai Hospital in Chicago for observation and treatment and remained there several days; that X-ray pictures of his body were taken and, although no definite diagnosis of his ailment or disease was made, he was advised that his condition was serious and that an operation might be necessary; that thereafter and at various times prior to the month of May, 1924, he received other treatments for ailments of the stomach and intestines at said hospital by Dr. H. B. Kipnis and other physicians, including Dr. Maurice I. Kaplan; that all of these facts were well known to the insured when he signed said application and that by his statements therein he intentionally and fraudulently deceived defendant ; that his death was brought about by the ailment or disease from which he had been suffering when he signed the application; that defendant, immediately upon discovery of the facts and of the insured’s fraud, elected to, and did on March 21, 1925, disaffirm and rescind the policy, and wrote to the beneficiary, Mrs. Sonea Koplen, at her home in Chicago to that effect, and in the letter tendered back by its check the premium that it had received, which check Mrs. Koplen retained but has not cashed; that defendant now in court again offers to return said premium; and that by reason of the premises the policy became null and void, and defendant is not indebted to plaintiff in any sum.

No further pleading, replying to defendant’s affidavit of merits, was filed by plaintiff, nor was any attempt made to amend her statement of claim in any manner. She did not present any pleading charging that the answers of the insured to said questions in Part II of the application were not actually and intentionally made, or that they were caused by any fraud practiced by the medical examiner, or that they were the result of any accident or mistake.

On the trial plaintiff introduced in evidence the policy (including the application) and the proofs of death. She testified in her own behalf, stating that from May 26, 1924, (date of medical examination) until August of that year the insured did not consult a physician os far as she knew, but that during August, 1924, he did consult and was treated by Dr. Kipnis. She did not testify as to the insured’s condition of health, or whether or not he had received treatments from physicians, prior to the date of said medical examination.

To maintain its affirmative defense of fraud and misrepresentation defendant called as witnesses Dr. Eberhardt, Dr. Kipnis and Dr. Kaplan, and introduced certain records of the Mount Sinai Hospital and other writings. We deem it unnecessary to outline or discuss this voluminous evidence. Suffice it to say that it strongly sustains the allegations of defendant’s affidavit' of merits in all essential particulars.

In rebuttal plaintiff testified that Dr. Eberhardt conducted the medical examination of the insured at the family home on May 26, 1924, about supper time; that as it progressed she “did not see what the doctor did,” as she was in an adjoining room; but that “Mr. Fogle and Mr. Barken” were in the room when the examination was had. She, however, gave no testimony which in any manner contradicted defendant’s evidence supporting its affirmative defense.

Thereupon, plaintiff called as a witness Samuel Fogle, He testified that he lived at Wyandotte, Michigan; that he was present at the Koplen home on May 26, 1924, when Dr. Eberhardt examined Samuel Koplen for a life insurance policy; that the examination lasted about 15 minutes; that the doctor ‘‘ seemed to be in a hurry’ ’; and that he (the witness) overheard conversation between said Koplen and the doctor. He was then asked the question by plaintiff’s attorney “Did Dr. Eberhardt ask Mr. Koplen in your presence and hearing this question, ‘Have you been under observation or treatment in any hospital, asylum or sanitarium?’ Upon objection the court refused to allow the witness to answer the question. Thereupon similar questions were asked the witness as to whether he heard the doctor ask Koplen the three other questions (viz: 8, C., 10, and 11, as contained in the application as above mentioned), but the court also refused to allow the witness to answer them. Plaintiff’s attorney then stated that the witness, had he been allowed to answer the questions, would have answered “No” to each of them. And thereupon it was stipulated that “Mr. Barken,” then present in court, would answer “No” to the same questions, were he allowed to do so. At the conclusion of all the evidence the court directed the jury to find the issues against plaintiff, which verdict was returned and the judgment in question against plaintiff followed.

The main contentions of plaintiff’s counsel are that the court erred (1) in directing a verdict against plaintiff at the close of all the evidence, and (2) in refusing to admit the offered testimony in rebuttal of plaintiff’s witnesses Fogle and Barken.

On the other hand defendant’s counsel contend (1) that the directed verdict was proper because defendant’s defense of fraud and misrepresentation in the insured’s application was an affirmative one and was sustained by proof and there was no evidence introduced by plaintiff contradicting defendant’s evidence on the issue, and (2) that the offered testimony of plaintiff’s witnesses, Fogle and Barken, was properly excluded.

Defendant’s defense in the present case was an affirmative one. (Continental Ins. Co. v. Rogers, 119 Ill. 474, 485; Guardian Mut. Life Ins. Co. v. Hogan, 80 Ill. 35, 41; Piedmont & Arlington Life Ins. Co. v. Ewing, 92 U.. S. 377, 378; Monahan v. Metropolitan Life Ins. Co., 180 Ill. App. 390, 394; Hamer v. Globe Mut. Life Ins. Co., 243 Ill. App. 109,113.) And, “where evidence of an affirmative defense is offered, as in this case, it is proper to direct a verdict for the defendant, even though all the averments of the declaration are proved, if the evidence of the affirmative defense is not contradicted or explained.” (Wallner v. Chicago Consol. Traction Co., 245 Ill. 148,152; Helm v. Illinois Commercial Men’s Ass’n, 279 Ill. 570, 575.) And in the present case, there being- no admitted evidence offered by plaintiff contradicting or explaining defendant’s evidence (which sustained the affirmative defense of fraud and misrepresentation in the insured’s application), plaintiff was not entitled to recover and the directed verdict against her was proper. (Blahofski v. Metropolitan Life Ins. Co., 237 Ill. App. 220, 225; Hranicka v. Prudential Ins. Co., 235 Ill. App. 257, 263; Enright v. Knights of Security, 253 Ill. 460, 466.) The insured must have known that his answers to the questions in the application were false and untrue. As said in Crosse v. Knights of Honor, 254 Ill. 80, 84; “The answers made were material to the risk and did not relate to a matter of opinion or judgment concerning which there might be a mistaken but honest belief.”

But plaintiff’s counsel contends in substance that, if the offered testimony of the witnesses Fogle and Bar-ken had been admitted, there would have been some evidence by plaintiff tending to contradict or explain defendant’s evidence supporting its affirmative defense, thereby requiring the submission of the cause to a jury. To this contention defendant’s counsel reply that the offered testimony was not admissible under the pleadings. We think there is substantial merit in defendant counsel’s reply contention. In her statement of claim plaintiff set out in full the policy, including Koplen’s written application made a part of the policy contract, and alleged that Koplen during his lifetime “did keep, perform and comply with all the terms, conditions and provisions of said policy upon his part to be kept and performed. ’ ’ She thereby affirmed the contract as written, including Koplen’s statement over his signature to Part II of the application that each of his answers to the questions therein “is full, complete and true,” and that he agrees “that the company believing them to be true shall rely and act upon them.” Nowhere in the statement of claim is there any allegation that any of the answers were untrue or that the answers resulted from any fraud practiced by the medical examiner or from any other cause. And after defendant’s affidavit of merits was filed, setting forth its affirmative defense as stated, plaintiff did not file any further pleading, or ask leave to amend her statement of claim, alleging any reason or excuse for Koplen having signed said application containing said answers. The rules of the municipal court, in force at the time of the trial, are contained in the present transcript certified by the trial judge. Rule No. 15 (n) provides that “all such grounds of defense or reply as would raise issues of fact not arising out of the preceding pleadings must be specifically pleaded, including fraud, . . . estoppel . . . and all other matter by ivay of confession and, avoidance.” Under this rule it was incumbent upon plaintiff to file a reply to defendant’s affidavit of merits if she desired to put any such matters in issue. When the case went to trial under the existing pleadings, the sole issue was whether Koplen’s said answers, material to the risk and relied upon by defendant as being true, were in fact false. And defendant’s evidence disclosed without contradiction that they were false. In this connection the recent case of Metropolitan Life Ins. Co. v. Trunick’s Adm’r, 229 Ky. 173, decided by the court of appeals of Kentucky, 16 S. W. Rep. (2d.) 759, maybe referred to. In the opinion the court referred to a prior decision (143 Ky. 488) where a plaintiff, suing upon a life insurance policy, had attempted in rebuttal to show that certain answers appearing in ah application were not made by the insured, and where “the testimony to establish such facts was rejected by the trial court, and that ruling was approved by us solely upon the ground that as a condition precedent to the 'admissibility of the offered testimony there should be a pleading expressly relying upon such facts. ’ ’ And the court, following that decision, said (p. 760):

‘ ‘ The rule is not a harsh one, and is eminently proper in furtherance of the fundamental purpose of proper pleading. That purpose is to inform the adversary litigant of the facts upon which reliance will be made. When it is intended to impeach a written contract or some portion thereof that the opposite party is relying on for his cause of action or defense, it is highly essential that the latter should be informed of such intention and purpose, so that he may prepare himself to meet the issues. The existence of the rule does not mean, as counsel for plaintiff seems to conclude, that an insurance agent may fraudulently procure the signature of the insured to a falsified application and permanently and unalterably bind him thereby. It only requires that before the insured in such a case may attack the writing which he acknowledgedly signed, he must plead the facts constituting his grounds of attack, and which constitutes no departure from established rules of practice, nor does it have the effect to fasten the fruits of fraud upon the defrauded party without remedy of escape. It only prescribes a method of escape, and which must be pursued in order to be available to the defrauded party.”

The decision in the case of Liverpool & L. & G. Ins. Co. v. Morris, 79 Ga. 666, 669, is substantially to the same effect. And the municipal court rule, above referred to, is in harmony with these decisions.

And we do not think that the decision in the case of Tykalowicz v. Metropolitan Life Ins. Co., 249 Ill. App. 280, 287, cited by plaintiff’s counsel, is to the contrary. In that case the plaintiff, by a replication to the company’s similar affirmative defense, alleged certain facts which, if proved, would have tended to show that the company was estopped to raise its affirmative defense. In the present case there is nothing in plaintiff’s pleadings indicating any waiver of, or estoppel to raise, defendant’s affirmative defense, which, if relied upon, must have been pleaded as well as proved. (Feder v. Midland Casualty Co., 316 Ill. 552, 559-60; East St. Louis Lumber Co. v. U. S. Branch of London Assurance Corp., 246 Ill. App. 574, 579.)

Furthermore, we do not think that the rejected testimony of the witnesses Fogle and Barken tended to show any mistake as to the insured making the answers as written in the application, as he certified over his own signature that he had read them over. This being so, it was immaterial whether Dr. Eberhardt asked the four questions of the insured. And no testimony was offered by said witnesses tending to show that Dr. Eberhardt at the time was guilty of any fraudulent conduct toward the insured.

And we do not think that the Recent decision of our Supreme Court in Guter v. Security Benefit Ass’n, 335 Ill. 174, also cited by plaintiff’s counsel, is contrary to our present holdings. In that case the court decided that the testimony offered by the plaintiff in rebuttal tended to show a fraud perpetrated on the insured by the association’s examiner, that the plaintiff’s replication to the association’s pleas, setting forth affirmative defenses, was sufficient to allow said testimony to be introduced, and that the trial court erred in instructing the jury to find the issues for the association. In the present case no replication was filed to the affirmative defense as pleaded by the company, its said defense was proven without contradiction, and the rejected testimony of the witnesses Fogle and Barken did not tend to show any fraud practiced on the insured, or any accident or mistake, at the time he signed said application.

For the reasons indicated we think that the trial court properly instructed the jury at the close of all the evidence to find the issues against the plaintiff. Accordingly, the judgment should be and is affirmed.

Affirmed.

Barnes, P. J,, and Scanlan, J., concur.


author: Mr. Justice Gridley Mr. Justice Scanlan

text:
    Peoples Gas Light & Coke Company, Appellee, v. Cook Lumber Terminal Company et al., Defendants. E. L. Cook, Appellant.
    Gen. No. 34,022.

      Scanlan, J., dissenting.
    Opinion filed March 11, 1930.

      Morton S. Cressy, for appellant; Preston Clark and Gilbert W. Schoenwald, of counsel.
    Cooke, Sullivan & Ricks, for appellee; Edwin Hedrick and Edmond W. Hebel, of counsel.
   Mr. Justice Gridley

delivered the opinion of the court.

Complainant filed its verified bill in the circuit court of Cook county praying for a perpetual and also a temporary injunction against defendants. On the following day, September 25, 1929, after notice, there was a hearing on complainant’s motion for a temporary injunction, and the court, following the prayer of the bill and solely upon its allegations and the provisions of a certain easement agreement made a part thereof, enjoined defendants, their agents and attorneys, until further order, “from constructing or erecting over, within or upon the ten (10) foot strip of land covered by a certain grant of easement given by Atchison, Topeka and Sante Fe Railroad Company, as grantor, to Peoples Gas Light and Coke Company, as grantee, under date of March 1, 1920, . . . either the said building referred to in the bill of complaint, and to be located at 3630-3648 West 38th street, Chicago, or any other building or structure that will in any way interfere with, infringe upon, trespass upon, damage or destroy the rights, privileges and easements to lay, operate, maintain, repair, renew, relay or replace gas mains and appurtenances thereto now possessed by said Peoples Gas Light and Coke Company under and by virtue of the aforesaid easement grant.”

By virtue of the provisions of section 123 of the Practice Act, Cahill’s St. ch. 110, ¶ 122, one of the defendants, E. L. Cook, took an appeal from the order to this court by filing his bond, with surety, with the clerk of the circuit court, which bond was approved by said clerk on October 7, 1929, and the appeal was perfected within apt time in this court. On December 31, 1929, by a majority opinion, said injunction order was reversed, but subsequently, upon complainant’s petition, a rehearing was granted and defendants made written answer to the petition. In the light of additional arguments of opposing counsel we have given further consideration to the case.

In the petition for rehearing complainant’s counsel contend that this court has “no jurisdiction or power” to reverse said order for the reason that only one of the defendants (E. L. Cook) appealed therefrom whilst all four defendants joined in the assignment of error, and that the present appeal should be dismissed. We do not think there is any merit in the contention. A somewhat similar one was made and denied in Commerce Vault Co. v. Hurd & Nettleton, 73 Ill. App., 107. In that case Hurd and Nettleton had obtained a temporary injunction in the circuit court against the Vault Company and three other defendants, and the Vault company within apt time had filed its appeal bond with the clerk of the circuit court. The appellees moved to dismiss the appeal upon various grounds, among them the third, that “no order of court was entered allowing appellant to appeal separately.” After stating that the statute (now said section 123) allowing appeals from interlocutory orders granting injunctions “does not contemplate that the court entering the order for injunction shall have anything to do with the appeal,” that “the taking of an appeal consists of a single act—filing a bond approved by the clerk,” that “no prayer for an appeal is to be addressed to anybody,” and that “no notice of appeal is necessary,” the court held that said third ground was untenable, and said (p. Ill): “The right to appeal is not limited to all the parties against whom the injunction may run.” (See Neil v. Oldach, 86 Ill. App. 354, 355, and also section 97 of the Practice Act, Cahill’s St. ch. 110, ¶ 97.) We think it clear that the present case is properly before us for review on the sole question whether the court erred in granting said temporary injunction order.

As the order was granted solely upon the allegations of the bill and the provisions of the easement agreement made a part thereof, and before any pleading had been filed by defendants, the question whether the court erred in granting the order must be determined from the well pleaded facts as alleged. The bill not only prayed for a temporary injunction to the extent as above stated but also for a perpetual one to the same extent. In Baird v. Community High School Dist., 304 Ill. 526, 529, our Supreme Court said: “When a bill of complaint is presented to a court praying for relief which the court has jurisdiction to grant upon a final hearing, and facts are stated which prima facie give a right to such relief, the court may, and frequently should, grant a temporary injunction where the effect will be no more than the mere maintenance of the status.quo.” And the court further said: “It is essential that the bill should make a prima facie case for final relief by alleging facts which, if proved and not controverted, will entitle the complainant to the relief prayed for.” In Novnanian v. Bedessern, 63 Ill. App. 353, 355, it is said: “If he (complainant) can have no relief at the hearing, he can have no interlocutory injunction. (See also, Koelling v. Foster, 150 Ill. App. 130, 134.)

The bill alleged that complainant, an Illinois corporation with principal office in Chicago, is now and for many years has been engaged as a public utility in the business of supplying gas to the City of Chicago and its inhabitants for illuminating, heating and industrial purposes; that defendant, Cook Lumber Terminal Co. (hereinafter referred to as the Lumber Co.) is also an Illinois corporation with principal place of business in Chicago; that defendant, E. L. Cook, is the president of the Lumber Co. and in active charge of its business; that defendant Jensen is engaged in the business of general contracting for masonry and brick work: that defendant Epstein is an architect; that complainant has an extensive system of gas mains laid underground in the city; that most of its principal mains are laid in the public streets under authority of statute and ordinance provisions, but in numerous instances they are laid in private rights of way either owned by complainant in fee or for which grants of easements have been secured by it; and that none of said mains is laid or maintained under buildings.

The bill further alleged that on March 1, 1920, complainant, for a valuable consideration paid by it, secured from the Atchison, Topeka & Santa Fe Railroad Company (hereinafter referred to as the Railroad Co.) an easement agreement, granting to complainant a perpetual right, privilege and easement “to lay, operate, maintain, repair, renew, relay and replace a gas main (with its appurtenances), of such size as complainant might from time to time elect, in, through, under, along and across a strip of land ten feet in width situated on certain property in Chicago, ’ ’ then owned by the Railroad Co. (Here follows description.) A copy of the easement agreement is attached to and made a part of the bill, as “Exhibit A,” and it is alleged that the original thereof was filed for record in the office of the recorder of Cook county on July 15, 1920.

The easement agreement dated March 1, 1920, is between the Railroad Co., first party, and the Gas Co. (complainant), second party. In the recitals reference is made to an attached blue print marked “Exhibit A” and made a part of the agreement. And in Article I of the agreement it is stated that, in consideration of $945 paid by the Gas Co. and of its faithful performance of its covenants, the Railroad Co. grants unto the Gas Co., its successors, lessees, and assigns, the perpetual right or easement, as stated in the bill as above mentioned, “together with the right temporarily to use, from time to time as required, so much of the surface of the land adjacent to said ten foot strip for depositing the earth removed in excavating the ditch, and for the placing and use of excavating and construction equipment and material as, together with the use of the surface of said ten foot strip, may be necessary in laying, relaying, replacing or repairing said gas main, . . . provided, however, that the use of such adjacent land for such purpose or purposes by the Gas Co., its successors, lessees and assigns, shall not interfere with its use as required Toy the Railroad Co., its successors, lessees or assigns.”

In paragraph 1 of Article II of the agreement it is provided that the gas main shall be constructed and installed in a workmanlike manner, ‘ ‘ and so that the same shall not necessitate any change in the present elevation at the point of crossing or in the gradient or use of any existing sewer or sewers or in the use of any pipe lines, conduits or other facilities now located upon or across the premises covered by this easement”; that the gas main shall be laid beneath the surface of said ten-foot strip “so that the top of said pipe shall be at an elevation ten feet above Chicago City datum” (as shown by a certain profile, marked “Exhibit B” attached to and made a part of the agreement); and that, before undertaking any work of installing, relaying or replacing the gas main underneath any track, the Gas Co. will give the Railroad Co. at least five days written notice to enable it to protect its property during the period of disturbance.

In paragraph 3 of Article II it is provided “that, except in the easement and rights herein granted, full and complete title, ownership and use of the property herein involved is reserved to the Railroad Co., its successors or assigns.”

In paragraph 4 it is provided that the Gas Co. “will at all times keep and maintain said gas main in such order and condition that the same will not at any time be a source of danger to or interference with the existing tracks, or tracks which the Railroad Co. may in the future construct across said strip of ground, or existing sewers, conduits, pipe lines, buildings, or other property of the Railroad Co., or the safe operation of its railroad. ”

In paragraph 5 it is provided that the Railroad Co. shall not be liable to the Gas Co. for any loss or damage suffered by the Gas Co. “in the lowering or otherwise changing of its said gas main growing out of or incidental to the opening of any streets by the City of Chicago across said premises.”

In paragraph 7, it is provided that “the foregoing covenants shall continue to run in favor of the Railroad Co., its successors and assigns unless or until said ten-foot strip shall by dedication, condemnation or otherwise fall within and become a part of a public street in the City of Chicago. ’ ’.

In paragraph 8 it is provided that “this agreement shall be binding upon and inure to the benefit of the parties, their respective successors and assigns.”

The bill further alleged that complainant, shortly after securing said easement grant, laid under and across the premises, and within said ten foot strip,, “a thirty six (36") inch gas main,” which since its installation has carried and is now carrying a flow of gas at medium pressure,—approximately six pounds per square inch; that the gas main is one of the principal arteries of the system by which gas is supplied to and distributed by complainant throughout the south part of said city; that it consists of cast iron pipes, 36 inches in diameter and approximately 12 feet in length; that the pipes are held together by lead joints, of adequate strength for the medium gas pressures now used; that should it be required to substantially increase the gas pressure, it will be necessary to replace said joints with others of a different type of construction and of greater strength; that because of the increasing demand for gas, it will be necessary within the next two or three years to change said joints and make repairs or replacements in the particular gas main on said premises and for that purpose free access to it will be required; that at present it frequently becomes necessary to make repairs and other changes in existing gas mains; that sudden changes in temperature, defects in piping, surface disturbances, etc., from time to time cause leakages or breaks, necessitating immediate repairs or replacements; and that it is essential for complainant, in order properly to fulfill its obligations as a public utility to furnish gas and render satisfactory service to the public, to have ready access at all times to all of its gas mains, and be able without delay or hindrance to reach the same by making excavations, etc.

The bill further alleged that since said agreement was executed and the gas main laid, the Railroad Co. sold the • premises, subject to said easement grant, either to defendant, the Lumber Co. or to defendant, E. L. Cook, and they are now in possession thereof under claim of ownership; that “some months ago” said Cook notified complainant that the Lumber Co. “intended to erect and construct, over and upon a part of the strip of land under which complainant’s said gas main is laid . . . a permanent brick building”; that complainant immediately informed Cook and the Lumber Co. “that the proposed building would interfere with and trespass upon complainant’s rights under said easement, and that complainant did, and would at all times, object to the construction thereof”; that complainant “has at all times since continued to insist upon said objections” and its “said position” has at all times been known to the Lumber Co. and to said Cook; that “from and since said time negotiations have teen continuously pending” between complainant and Cook “for the purpose of reaching an agreement about the construction of the proposed building in such a manner and on such location as will not interfere with complainant’s easement rights”; that on or about September 18, 1929, Cook notified complainant that the Lumber Co. “intended to proceed to construct a foundation for a permanent brick building, which would be located at 3630-3648 West 38th Street, Chicago, and which would rest upon, cross and enclose a part of the strip of land covered by the aforesaid easement”; that the Lumber Co., “while pretending to be negotiating with complainant about its easement rights, has in fact caused a cement foundation to be commenced for such building”; and that “both the south and west sides of said foundation cross said main of complainant, and that any building erected on said foundation will cover and enclose within its walls more than sixty (60) feet of said main, and will deprive complainant of access to said section of said main and will interfere with, impair and obstruct the enjoyment of and use by complainant of the rights and privileges granted to and possessed by it under said easement grant.”

The bill further alleged that the Lumber Co., in disregard of complainant’s rights, “now threatens to, and unless restrained will, proceed to construct said permanent brick building over and upon a part of the strip tif land covered by the aforesaid easement, and over, upon and across more than 60 feet of said 36 inch gas main”; that said building, if constructed, “will greatly and irreparably damage and injure” complainant and infringe upon its rights and privileges under said easement ; and that the Lumber Co., in connection with the erection of the proposed building, has employed defendant, Jensen, as masonry contractor, and defendant Epstein, as architect, and that both “are now participatiug in the work of preparing for the construction for the Lumber Co. of said building to be located upon the place aforesaid.”

In 9 Buling Case Law, p. 799, sec. 55, it is said: “It is a general rule that a grant of an easement of a right of way does not, by implication, include the right to have that way kept open to the sky for light and air, and that the grant is not interfered with by building over the way, provided there is no interference with-the reasonable use of the easement as a passageway; subject to the easement, the landowner’s control extends indefinitely upward from the surface and downward.” In 2 Tiffany on Beal Property, 2nd ed., p. 1353, sec. 371, it is said: “The owner of a right of way in a city cannot ordinarily demand that the space over the way be absolutely free from projections above the way, such as bay windows, at such a height as not to interfere with the right of passage, and the owner of the servient tenement may even place an arch over, or otherwise span, the line of the right of way, and erect a building thereon, provided the building is not so near the ground as unreasonably to interfere with the user of the way, and, provided further, the language of the grant, construed with reference to the surrounding circumstances, does not indicate an intention that nothing shall be erected thereover.”

In Tacoma Safety Deposit Co. v. City of Chicago, 247 Ill. 192, 196, it is said: “We think that the law is well settled that the owner of real estate, subject only to a public or private easement, has the right to use his property for any purpose which he may deem proper, so long as the use to which it is put does not interfere with the proper enjoyment of the easement which is held by the public or by a private person therein. ’ ’

In Doan v. Allgood, 310 Ill. 381, 384, our Supreme Court reiterates the above statement of the law as made in the Tacoma Deposit Co. case, and further says: “On the other hand, the owner of the easement is entitled to its full enjoyment, together with every right necessary to such enjoyment. He has no right, merely for the sake of convenience, to interfere with the owner’s control and beneficial use of the land further than is necessary for the reasonable enjoyment of his easement.”

In Jones on Easements (1898 Ed.), p. 669, sec. 832, it is said: “The owner of the servient estate has the right to improve his estate, and to this end to change any structure connected with the easement, so as to make it more ornamental, provided he does not impair the easement or make it less fit for the service for which it was acquired. Thus, where an easement in the use of an aqueduct was acquired by prescription, and there was a covering over the reservoir upon the servient estate, it was held that the form of the covering was not fixed by the prescription, but that this might be reasonably changed by the landowner in the improvement of his grounds, no injury being done to the aqueduct.” (Citing Olcott v. Thompson, 59 N. H. 154, 156.)

Complainant’s position, as appears from statements made in the briefs and upon oral argument, is in substance that, because of the provisions of the easement agreement and the installation and user of the gas main thereunder, the Lumber Co. or Cook, as grantee or assignee from the Railroad Co. of the premises, cannot lawfully improve them by the erection of the proposed building, or any building, for' the reason that such a structure will interfere with complainant’s right of access to its gas main whenever it becomes necessary or advisable to make repairs or replacements-. We are of the opinion that this position is untenable. It is contrary to the principles of the law concerning easements as above set forth. We find nothing in the easement agreement indicating that the intention of the parties was that no building should ever be erected over the ten-foot strip. Indeed, paragraph 3 of Article II of the agreement indicates a contrary intention. It is there provided that, “except in the easement and rights herein granted, full and complete title, ownership and use of the property herein involved is reserved to the Railroad Co., its successors or assigns.”

It is apparent that no building or structure can be erected over the portion of the ten-foot strip without making complainant’s access to said portion less convenient for the purposes mentioned. It would to some extent “interfere” therewith, and any interference is enjoined. Hence, the injunction virtually prevents the Lumber Co. or Cook until further order of the court from erecting the proposed building, or my building, notwithstanding the company or Cook has the right to improve the premises with a building, provided the same does not interfere with the reasonable enjoyment of complainant’s easement. And the bill, upon which the injunction is based, is noticeable for what it does not allege. It alleges that Epstein is the architect and Jensen the masonry contractor for the building; that “some months” prior to the filing of the bill Cook notified complainant that the Lumber Co. intended to erect over and upon a part of the strip “a permanent brick building”; that complainant then objected; that since that time “negotiations have been continuously pending” between complainant and Cook “for the purpose of reaching an agreement” about the construction of the building “in such a manner and on such location as will not interfere with complainant’s easement right”; that about six days before the bill was filed Cook notified complainant- that the Lumber Co. intended to proceed to construct a foundation for the building, “which would rest upon, cross and enclose a part of said strip of land”; and “that both the south and west sides of said foundation cross complainant’s main, and that any building erected on said foundation will cover and enclose within its walls more than sixty (60) feet of said main, and will deprive complainant of access to said section of the main, and will interfere with, impair and obstruct the enjoyment, and the use by it,” of said easement rights. But there are no allegations as to the nature or character of the previous negotiations mentioned, nor is it alleged how or in what manner complainant will be deprived of a reasonable access to its main for the purpose of making repairs, replacements, etc. The allegation that Epstein is the architect for the proposed building, and other allegations, indicate that plans for the building have been drawn and seen by complainant’s representative. And for aught that appears to the contrary from the bill the plan or scheme of construction of the building may provide, by means of arches in the basement walls or otherwise, for all reasonable access for complainant to the portion of the main underneath the building and for the depositing of earth, etc., during the making of necessary excavations in said portion of the strip of land. And it is not alleged that the proposed basement walls or building will in any way injure the gas main. There are well settled rules that a court should exercise caution in issuing a preliminary injunction (32 Corpus Juris, p. 33); that such an injunction will not be issued in a doubtful case, or where its effect will be more than the mere maintenance of the status quo (C. J., p. 36); or where its effect is the granting of all the relief that can be obtained after a final hearing (0. J., p. 21); that the facts upon which a complainant relies for the issuance of a preliminary injunction should be stated in the bill with particularity (C. J., p. 321); that all reasonable inferences arising from the allegations, indicating that complainant might not be entitled to the relief as prayed, should be negatived (C. J., p. 322); and that facts, rather than conclusions or opinions of the pleader, should be stated (C. J., p. 322). In 14 Ruling Case Law, see. 32, p. 331, it is said): “It is not enough that a complainant shall allege in his bill that the injury will occur to himself or property, but he must show facts to enable the court to judge if the injury will be of the character stated. It is therefore essential that a full and candid disclosure of the facts should be made, and if the case of complainant shows that this has not been done, or if it shows a concealment of facts which would, if stated, materially affect the conscience of the court, the chancellor may properly refuse an injunction.” In 1 High on Injunctions, 4th Ed. Sec. 5, p. 9, it is said: “The court will not, however, upon an application for an interlocutory injunction, shut its eyes to the question of the probability of plaintiff ultimately establishing his demand, nor will it by injunction disturb defendant in the exercise of a legal right without a probability that plaintiff may finally maintain his right as against that of the defendant.” In 2 High on Injunctions, sec. 1696, p. 1645, it is said: “But the rule that the granting or denying of a preliminary injunction involves such an exercise of judgment upon the part of the chancellor as will not be disturbed upon appeal does not apply to cases involving questions of law arising upon the face of the bill.” (Citing Burlington C. R. & N. Ry. Co. v. Bey, 82 Iowa, 312, 344). Tested by these rules, and considering the allegations of the bill and the provisions of the easement agreement, we are of the opinion that the temporary injunction order appealed from was improvidently issued. We do not think that in the present bill complainant made a full and candid disclosure of all the facts, particularly as to what occurred during the negotiations between the parties prior to the filing of the bill and as to the respective positions then taken by them. Nor do we think that the bill sufficiently shows that by the erection of the proposed building complainant will be deprived of a reasonable access to the portion of its gas main involved, which is all that it is entitled to under the law and the provisions of the easement agreement.

On rehearing complainant’s counsel refer to certain holdings in .the cases of McDougall Co. v. Woods, 247 Ill. App. 170, and Friedman v. Peckler, 255 Ill. App. 199 (appeals from orders granting temporary injunctions), and contend that because of these holdings this court on the present appeal “should disregard any and all questions as to the sufficiency of the allegations of. the bill, with respect to the method of statement employed, even if the court should feel that the bill was somewhat defective in that respect.” While we cannot agree with all that was said in the opinions of those cases, respecting the right or duty of this court on an interlocutory appeal to consider whether a bill is vulnerable to a general demurrer, yet that is not the question on the present appeal. The sole question before us is whether, from all the facts and circumstances disclosed from the present bill, the chancellor was justified in granting the drastic injunction as first above mentioned. If the case may not be considered from, this viewpoint then the right of review by this court given by statute (sec. 123, Practice Act, Cahill’s St. ch. 110, ¶ 122) would be rendered practically nugatory in many cases. It is therein provided that “whenever an interlocutory order or decree is entered in any suit pending in any court in this State, granting an injunction, or overruling a motion to dissolve, the same . . . an appeal may be taken from such interlocutory order or decree to the Appellate Court of the district wherein is situated the court granting such interlocutory order or decree”; and that “upon such appeal the Appellate Court may affirm, modify or reverse such interlocutory order or decree, and shall direct such proceedings to be had in the court below as the justice of the case may require.” Nothing is said in the section suggesting that the right to take such an appeal, or to have the interlocutory order reviewed, is in any way dependent upon what may be the state or condition of the pleadings in the trial court. In McCarthy v. City of Chicago, 197 Ill. App. 564, 575, it is said that said section “was intended to secure a quick and summary review of interlocutory orders or decrees.” In People v. Sears, 230 Ill. App. 484, 489, it is said: “The language of this section is as broad and comprehensive as it is possible to employ. No class of cases is excluded. ’ ’ In People v. Standidge, 333 Ill. 361, 365, it is said that the statute “provides for the filing of the record and for a hearing. Obviously, the purpose of filing the record is that it may be considered on the appeal. The hearing is judicial in its nature. . . . The statute authorized the Appellate Court to direct the trial court to proceed ‘as the justice of the case may require. ’ Hence it was clearly within the jurisdiction of the Appellate Court, in reviewing the interlocutory order from which the appeal was taken, to consider the evidence upon which the order was based. Such a consideration was necessary to determine whether the issuance of the preliminary injunction was justified.” In the present case the only evidence upon which the chancellor based the injunction order was complainant’s verified bill, viz, the facts and circumstances as therein alleged. In Stover Mfg. Co. v. Mast, Foos & Co., 89 Fed. Rep. 333 (a case decided by the ÍT. S. Circuit Court of Appeals for the seventh circuit) it appears that, upon a bill and eos parte affidavits filed by the complainant, the chancellor granted an interlocutory injunction against infringement by defendant of a certain Letters-Patent, and that on appeal from such order complainant’s bill was dismissed,— the court being of the opinion that the bill had no equity to support it. The decree was affirmed by the Supreme Court of the United States (177 U. S. 485, 494). In view of the provisions of the statute and the authorities cited, we think it is our duty to reverse the interlocutory injunction order appealed from, for the reasons above outlined.

Accordingly, the injunction order of September 25, 1929, is reversed.

Reversed.

Barnes, P. J., concurs.

Mr. Justice Scanlan

dissenting: I dissented from

the original judgment that was entered in this case, and upon the rehearing, after a careful reconsideration of the very important questions involved in the present appeal, I am compelled to dissent from the present judgment of this court, and I deem it necessary to state the reasons for my dissent.

Counsel for defendants, upon notice, appeared before the chancellor at the time of the motion for the temporary injunction. They filed no answer and offered no affidavits or evidence in opposition to the application and it is clear that they desired to have the motion determined, not upon the merits, but solely upon the sworn bill.

The complainant is a large public service corporation and the easement in question is a very important one to it and the public whom it serves. The easement gives the complainant the perpetual right, privilege and easement to lay, operate, maintain, repair, renew, relay and replace a gas main (with its appurtenances) of such size as the complainant might from time to time elect, in, through, under, along and across a strip of land ten feet in width and over 2,000 feet long, and also “the right temporarily to use, from time to time as required, so much of the surface of the land adjacent to said ten foot strip for depositing the earth removed in excavating the ditch, and for the placing and use of excavating and construction equipment and material, as, together with the use of the surface of said ten foot strip, may be necessary in laying, relaying, replacing or repairing said gas main in, under and along said ten foot strip. ’ ’ The bill alleges that shortly after it secured the easement agreement it “entered upon said premises . . . and laid under and across said premises and within said ten foot strip designated by said easement grant a thirty-six (36") inch gas main which said main at all times since its installation has carried and now carries a flow of gas at medium pressure,—to-wit, approximately six (6) pounds per square inch—and is one of the principal arteries of the system by which gas is supplied to and distributed throughout the south part of said City of Chicago by your orator. ■ Said gas main consists of cast iron pipes thirty-six (36") inches in diameter and approximately twelve feet in length. Said pipes constituting said main are held together by lead joints, which are of sufficient and adequate strength for the medium gas pressures now used in said main. When and as it is necessary for your orator substantially to increase the pressure under which gas is conducted through said mains, it will be necessary for your orator to replace said joints by -joints of a different type construction and of greater strength. The increase and demand for gas throughout the south part of the City of Chicago will, in the opinion of your orator, within a short length of time, to-wit, within the next two or three years, necessitate the changing of said joints in order that gas of much higher pressures, to-wit, approximately twenty (20) pounds per square inch, may be carried through said mains, and the replacing and/or renewing of said joints; and in order to make said changes it will be necessary for your orator to have free access to uncover said mains at all points. It is necessary for your orator from time to time to make repairs and other changes in its mains and the joints thereof, including said mains laid through said property under the easement aforesaid. Sudden changes in temperature, defects in piping, surface disturbances and other causes which cannot be foretold, from time to time cause leakages or breaks in said mains and joints and necessitate repairs or replacements. It is impossible for your orator to know at any time where said leakages or breaks may occur, but in its large gas mains, to-wit, mains between twenty-four (24") and forty-eight (48") inches in diameter, such breaks or leaks, frequently as many as twenty to thirty a year, occur. In case of such leaks and breakages or in case of making necessary changes in mains, it is essential that your orator, in order safely and properly to fulfill its obligations as a public utility to furnish gas and to render adequate, efficient and satisfactory public service, and in order safely to carry on and conduct its business of transporting gas through said mains and in order fully to protect the lives and property of the general public from injury and damage by explosions and other dangers resulting from gas leakages occurring in said mains, have ready access at all times to its mains and be able promptly and without delay or hindrance to excavate to and reach said mains.”

The law on the relative rights of the parties in the matter of an easement has been settled by our Supreme Court in Doan v. Allgood, 310 Ill. 381, where the rule is thus stated: “The owner of land has the right to use the land for any purpose he may deem proper, so long as such use does not interfere with the proper enjoyment of the easement. (Tacoma Safety Deposit Co. v. City of Chicago, 247 Ill. 192). On the other hand, the owner of the-easement is entitled to its full enjoyment, together with every right necessary to such enjoyment. He has no right, merely for the sake of convenience, to interfere with the owner’s control and beneficial use of the land further than is necessary for the reasonable enjoyment of his easement.”

In the opinion of the majority it is stated that the complainant’s position is, in substance, that the defendant Lumber Company cannot lawfully erect the proposed building or any building on the premises in question “for the reason that such a structure will interfere with complainant’s right of access to its gas main whenever it becomes necessary or advisable to make repairs or replacements,” and the opinion holds that this position is untenable. The opinion misapprehends the position of the complainant, and, in my opinion, this misapprehension has affected the final judgment of the majority of the court. One of the contentions of the complainant is that “there are no provisions in the easement grant that reserve to the grantor or his successors the right to construct a building or other structure over the 10-foot strip covered by the easement grant, if such building interferes with the use and enjoyment of the easement.” (Italics mine.) The major contention of the complainant, as clearly appears from its brief, is that “the owner of the servient tenement cannot make such use of his estate as will encroach upon or interfere with the easement right created by the easement grant,” and in support of this contention the complainant states that the only question for decision “is whether or not the threatened acts of the defendants will interfere with the reasonable enjoyment of the easement right granted to the complainant, ’ ’ and further states that complainant “recognizes, also, the well settled legal principle . . . that the owner of the servient tenement may use the property in any way not inconsistent.with the rights of the dominant tenant.” The bill alleges that the complainant negotiated with the defendants “for the purpose of reaching an agreement about the construction of said proposed building in such a manner and on such location as will not interfere with said easement rights possessed by your orator.” In the brief of the defendants they state that “the bill of complaint affirmatively shows that the defendant has-endeavored to reach an agreement with the complainant about the construction of said proposed building in such a manner as will not interfere with the said easement.” In the petition for rehearing filed by the complainant it asserts that the majority of the court has entirely misapprehended its position and that it does not contend that no building of any kind could ever be erected on the property covered by the easement. It seems clear that the holding of the court in reference to the alleged position of the complainant, decides a question not involved in the case. The defendants have the right to erect a building on the premises in question so long as such use does not interfere with the full enjoyment of the easement. The temporary injunction merely prohibits the construction or erection over, within or upon the 10-foot strip of land covered by the easement, of the building referred to in the bill of complaint, or any other building or structure that will in any way interfere with, infringe upon, trespass upon, damage or destroy the rights, privileges and easements granted to the complainant" by the easement grant. I do not think that the order is too broad, but even if it is, we hav"e the right to modify it or to direct the chancellor to modify it. By the judgment of this court the injunctional order is reversed in toto.

For the purposes of this appeal, all material allegations, well pleaded, must be taken as true. In my opinion, the only question necessary to decide on this appeal is, whether or not the allegations of the bill, well pleaded, make out a prima facie showing that the threatened acts of the defendants will interfere with the reasonable enjoyment of the easement granted to complainant, or, to put it in another way, Is the bill vulnerable to general demurrer? (See Florin v. Rayman, 176 Ill. App. 106; Herzberger v. Barrow, 115 Ill. App. 79, 82; Baird v. Community Sigh School Dist., 304 Ill. 526, 529; Spiegler v. City of Chicago, 216 Ill. 114; Young v. Federal Union Surety Co., 183 Ill. App. 278, 282; Koelling v. Foster, 150 Ill. App. 130.) The defendants contend that the bill is vulnerable to general demurrer, and, if it is, in my opinion, it would be the duty of this court to reverse the injunctional order, for if the bill is vulnerable to general demurrer it fails to state a prima facie case and it, therefore, presents no grounds for equitable relief, and the action of the chancellor in granting a preliminary injunction upon such a bill would be clearly unwarranted. To warrant a preliminary injunction the bill should make out a prima facie case for final relief. (See cases last above cited.)

The opinion.states that the bill does not sufficiently show that the erection of the proposed building would deprive the complainant of a reasonable access to its easement. This is a holding that the bill does not make out a prima facie case, while in that part of the opinion that refers to the cases of McDougall v. Woods, and Friedman v. Peckler it is stated that the question as to whether or not the bill is vulnerable to general demurrer is not involved in the present appeal. These two holdings are not in harmony, for if the bill fails to make oút a prima facie case, it is vulnerable to general demurrer. However, in my judgment, the bill does make out a prima facie case, and is, therefore, not vulnerable to general demurrer. It alleges that the defendant Cook Lumber Company notified the complainant “that the said defendant corporation intended to erect and construct over and upon a part of the strip of land under which the said gas main of your orator is laid under and by" virtue of the aforesaid easement grant, a permanent brick buildingthat about September 18,1929, the defendant Cook Lumber Terminal Company notified the complainant “that- said defendant corporation intended and proposed to proceed to erect and construct a foundation for and a permanent brick building which would be located at 3630-3648 West 38th Street, Chicago, Illinois, and which would rest upon, cross and enclose a part of the strip of land covered by the aforesaid easement granted to your orator and under and by virtue of which your orator has laid its said gas main as aforesaid; that said defendant corporation, while pretending to be negotiating with your orator about the easement rights of your orator, has in fact caused a cement foundation to be commenced for said building and that both the south and west sides of said foundation cross your orator’s main and that any building erected on said foundation will cover and enclose within its walls many feet of said main, to-wit, more than sixty (60) feet, and will deprive your orator of access to said section of said main and will interfere with, impair and obstruct the enjoyment of and use by your orator of the rights and privileges granted to and possessed by your orator under the said easement grant”; that the said defendant “now threatens to, and, unless restrained by order of this honorable court, will proceed to construct and erect said permanent brick building over and upon a part of the strip of land covered by the aforesaid easement granted to your orator and over, upon and across many feet, to-wit, more than sixty (60) feet of said thirty-six (36") inch gas main of your orator.”

These allegations are statements of fact that bear directly upon the material question as to whether or not the construction of the proposed building would deprive the complainant of a reasonable access to its gas main for the purpose of making necessary repairs, etc., and, in my opinion, they cannot fairly be termed “conclusions rather than facts. ’ ’ They state as a fact that the foundation and building will not only inclose the strip of land in question but will cover a substantial portion of the same. In my judgment, a building, so constructed, would interfere with the full enjoyment of the easement. As the complainant contends, “it is no answer to assert that repairs and replacements can be made by bracing and supporting a building and then tunnelling from the ends or by tearing up the floor of the building if the tenants at such time see fit to permit complainant to have access to the building. As pointed out in Goodhart v. Hyett, 25 Ch. Div. 182, and Wheeler v. Black, 14 Canada S. C. 242, such burdens or risks are not thrown upon the easement holder. He has a right to use the easement granted free from such additional burdens and interference.” The bill alleges that in order to carry on and conduct its business of transporting gas through the said mains and to protect the lives and property of the general public from injury and damage by explosions and other dangers resulting from gas leakages occurring in its mains, it is necessary for the complainant to have ready access at all times to its mains and to be able promptly and without delay or hindrance to excavate to and reach its mains. The bill also alleges that the proposed building “will deprive your orator of access to said section of said main.” This is an allegation of an ultimate fact and it is directly supported by the other allegations of fact, immediately preceding it, and to which I have heretofore called attention. As argued by complainant: “An allegation that an act will violate an agreement may be a conclusion of law. But an allegation that the same act will produce a certain physical result, is a statement of an ultimate fact. ‘Allegations of result are allegations of fact and are not conclusions of law.’ (Bank of Commerce v. Schooner (1928), 263 Mass. 199, 160 N. E. (790, 791.) ” As against a demurrer, an allegation of an ultimate fact or conclusion of fact is sufficient. (Curtiss v. Livingston, 36 Minn. 380.) Conclusions of fact are not vulnerable to a demurrer. (Western Travelers’ Accident Ass’n v. Munson, 73 Nebr. 858, 861. See also Williams v. Peninsular Grocery Co., 73 Fla. 937; Crane v. Schaefer, 140 Ill. App. 647, 652-3.) Moreover, the allegations of the bill must be tested by general demurrer, not by special demurrer.' A theory that the defendants can build upon and cover a substantial portion of the strip of land involved in the easement with parts of a permanent building, without depriving the complainant of the full enjoyment of the easement, “together with every right necessary to such enjoyment,” seems to me untenable for two reasons, first, it would interfere with the reasonable enjoyment of the easement, and, second, it would place an intolerable burden upon the complainant and one not warranted by the easement grant or the law.

The opinion also holds, in effect, that the bill—even if it is not vulnerable to general demurrer—shows upon its face a concealment of facts, which, if they were stated, would materially affect the right of the complainant to an injunction, and that, therefore, this court has the right to reverse the injunctional order upon the ground that the chancellor abused his discretion. It is a settled principle of equity in this State that unless it clearly appears that the chancellor abused his discretionary powers in issuing a temporary injunction, the order will be affirmed on appeal. I have heretofore cited certain Illinois cases to the effect that on appeals of this kind the bill is to be tested as though the defendant had demurred to it, and the defendant can raise only such questions here as he could have raised in the lower court by general demurrer. I do not think that on an appeal of this kind it is the duty of this court, if it finds that the bill is not vulnerable to general demurrer, to search it for the purpose of determining whether or not the pleader has apparently concealed material facts. So far as I am aware, such a practice has never been followed in the Appellate courts pf this State. On the motion for the injunction before the chancellor in the instant proceeding, the case stood as though the defendants had demurred to the bill, and therefore the chancellor was required to decide only one question: Was the bill vulnerable to general demurrer? The defendants had the right to resist the application for the injunction, on the merits. They did not see fit to do so. The act provides various ways in which an injunctional order may be dissolved or modified, but the defendants did not see fit to take advantage of these provisions. On this appeal, if we find that the bill is not vulnerable to general demurrer, why should we reverse the chancellor upon a point that was not necessarily involved in the motion for a temporary injunction? In support of its holding the opinion relies upon a statement in 14 Ruling Case Law 331, sec. 32, to the effect that if the bill shows “a concealment of fact which would, if stated, materially affect the conscience of the court, the chancellor may properly refuse' an injunction. ’’ (Italics mine.) The author cites, in support of the text, Reddall v. Bryan, 14 Md. 444, and Shoemaker v. National Mechancis’ Bank, 31 Md. 396. In each of these cases the complainant appealed from an order refusing the injunction asked. As stated by the Maryland court, the granting or refusing of a writ of injunction is a matter resting in the sound discretion of the chancellor. In Reddall v. Bryan, supra, the court held that the sufficiency of the bill depended upon a determination of the question as to whether or not the acts charged were done by the defendants without authority of law, and the court further held that it sufficiently appeared from the face of the bill that the defendants were acting under the authority of the government of the United States. In other words, the court held that the bill was vulnerable to general demurrer. The court stated: “We think there is a great force in the view taken by the circuit court of the manner in which the case of the complainant is stated in the bill, and cannot avoid the conclusion, ‘that it is made out by the concealment of facts having a very important bearing upon it, and which would (if fully stated) act materially upon the conscience of the court. ’ ’ ’ (Italics mine.) In the above, the court quotes, with approval, from the opinion of the chancellor and sustains his action in refusing a preliminary injunction and held that he had not abused his discretion. I do not wish to be understood as contending that a chancellor in the exercise of his discretion may not refuse a preliminary injunction, even where the bill is not vulnerable to general demurrer, if the bill shows that the pleader has concealed material facts which, if pleaded, would affect the right of a complainant to an injunction.

The opinion in the present case reaches the conclusion that the bill shows that the complainant did not make a full and candid disclosure of all the facts, and that therefore the chancellor abused his discretion in entering the in junctional order, in the following manner: As there is an allegation in the bill that the Lumber Company employed an architect and mason contractor, it will be assumed that plans for the proposed building were drawn, and as there are allegations in the bill that negotiations took place between the complainant and the Lumber Company for the purpose of reaching an agreement as to the construction of the building in such a manner and on such location as would not interfere with complainant’s easement rights, and as the bill did not make a full and candid disclosure as to what occurred during the negotiations, and especially as to the respective positions then taken by the parties, it will be assumed that the plans were seen by complainant’s representative, and as the bill does not set up the plans, it will be assumed that they “may provide,” by means of arches in the basement walls or otherwise, for all reasonable access for complainant to its mains, etc., and therefore it must be held that the chancellor improvidently granted the injunctional order.

Here the ultimate assumption, and the one upon which the instant ruling is practically grounded, is based upon other assumptions. If the so-called rule in Reddall v. Bryan, supra, can be invoked, at all, in support of a judgment of this court reversing a chancellor, it certainly can be invoked only where the bill shows a concealment of material facts. The record shows that the defendants did not desire to have the motion before the chancellor determined on the merits. If we are to indulge in assumptions at all, we should assume that if the defendants had plans for the building that would not interfere with the easement rights of the complainant, they would, by answer or affidavit, have shown that fact to the chancellor. If the ruling upon the instant question is to be followed, a careful, cautious chancellor, even where he finds that a bill is not vulnerable to general demurrer, will refuse to grant a preliminary injunction unless he is certain that there are no allegations in the bill from which it might be inferred that the pleader has concealed facts which, if stated, might materially affect the judgment of the court. The ultimate assumption in the opinion, that the plans “may provide” by means of arches in the basement walls or otherwise, for all reasonable access for complainant to its mains, etc., is entirely unwarranted in view of the allegations in the bill that the foundation and building loill cover a substantial portion of the strip of land in question and that the proposed building “will deprive you,r orator of access to said section of said main.”

The defendants acquired the premises in question with full knowledge of the great importance of the easement right to the complainant and the public. The necessity for prompt access to the easement at all times is manifest from the bill. By the judgment of this court the preliminary injunction is dissolved in toto upon the assumption that the building to be erected by the defendants “may provide” “reasonable access” to the easement. If the defendants put up a building, parts of which will cover substantial portions of the strip of land in question, it will then be practically impossible to right the wrong done the complainant. But, on the other hand, if the building the defendants intend to erect will not interfere with the reasonable enjoyment of the easement right, they may, in apt ways, make a showing to that effect and thereby bring about the vacation or modification of the injunctional order. Under the bill, the chancellor, in my judgment, was clearly justified in granting the temporary injunction, which merely maintains the status quo.

The injunctional order of the circuit court, in my' opinion, should be affirmed.