text:
    Robert Pearson, Minor, by Sophia Pearson, His Guardian and Next Friend, et al., Appellants, v. Lois Renfro et al., Appellees.
    Gen. No. 9,883.

      Opinion filed July 8, 1943.
    Rehearing denied September 21, 1943.
    B. Jay Knight and Russell Goldman, both of Rockford, for appellants; B. Jay Knight, of Rockford, of counsel.

      Frank P. Forth, of Rockford, for certain appellees;
    Williams & Dunn, of Rockford, for certain other appellees.
    Welsh & Welsh, of Rockford, for certain other appellee.
   Mr. Justice Dove

delivered the opinion of the court.

This cause is here by an appeal from a judgment of the circuit court of Winnebago county in favor of the defendants, appellees, on a directed verdict at the close of the testimony for the plaintiffs, appellants, in an action to recover damages under section 14 of article 6 of the Liquor Control Act. (Ill. Rev. Stat. 1941, ch. 43, par. 135 [Jones Ill. Stats. Ann. 68.042].)

The suit was instituted by Robert Pearson, a minor, John Behrens, Jr., the latter’s sister Phyllis, and their respective parents, against the respective proprietors of the Shamrock tavern at Rockford and another tavern at Cherry Valley, and the respective owners of the premises. Robert Pearson, John Behrens, Jr. and Phyllis Behrens lived at home with their parents. Phyllis was 17 years old, and was in high school. Each of the boys was employed at a factory. As to Robert Pearson and John Behrens, Jr. the complaint alleges damages on account of personal injuries incurred in an automobile accident on the night of February 22,1941, while riding in an automobile driven by George Verble, another minor, whom they claim was intoxicated by liquor purchased at- the two taverns mentioned. As to their parents and Phyllis Behrens, the complaint alleges • damages for loss of means of support. The grounds assigned for reversal are that the court erred in directing a verdict for appellees at the close of the testimony for appellants and in refusing to admit testimony offered on behalf of appellants.

The testimony discloses that about 7 o’clock p. m., ou the night of February 22, 1941, Robert Pearson, John Behrens, Jr., George Verble, and Tony Sanvitis, were at the Shamrock tavern. They had several drinks of beer and whiskey, and some of them played the pinball machines. Several other young people were there. One of them testified he was there a couple of hours and that during that time George Verble must have had a half dozen drinks of whiskey. The four named left the Shamrock tavern at about 8:30 p. m. in an automobile driven by George Verble, intending to go to a dance at Genoa. On the way, they stopped at the Cherry Valley tavern, where they played rotation pool, and each of them had three or four more drinks of whiskey. At each of the taverns they bought drinks for each other in rounds, each one of them paying in turn for a round of drinks.. They left the Cherry Valley tavern about 9:30 p. m. or later, with George Verble driving the car. At a point about two and one-half miles northwest of Genoa, the car, traveling at a high rate of speed, left the black top pavement, and crashed into an electric light pole. Robert Pearson’s left leg was broken and he had a brain concussion. He was in a hospital eight weeks, after which he was at home on crutches about two months, and used a cane three or four weeks more, returning to work about August 1, 1941. John Behrens, Jr., suffered, a com-minuted fracture of the right femur, injuries to his vertebrae and a cerebral contusion. He was in a hospital four and a half months, after which he was at home until about the middle of March 1942, and returned to work on April 30, 1942. Their hospital, doctor and nursing bills were $775 and $3,115.80 respectively. The other two boys received minor injuries.

The testimony shows that George Verble was usually quiet, but that at the Shamrock tavern he was “acting silly,” talking loud, and that at the hospital after the accident lie was noticeably drowsy and slept through the night. According to the testimony of Robert Pearson he, the witness, was about half intoxicated when they left the Shamrock tavern, and he believed he was intoxicated when they left the Cherry Valley tavern. From all the facts in evidence the only inference reasonably to be drawn therefrom is that George Verble was intoxicated at the time of the accident.

Robert Pearson was 21 years old about one week after the accident. He left school at the age of 16 years and has “earned his own money” ever since. For four months prior to the accident he was earning $24 per week, and upon returning to work was paid at the rate of $27 per week. At the time of the trial he had been accepted for army service, classified as 1-A, with notice of induction a short time before the trial. John Behrens, Jr. was earning $35 a week before the accident and was paid approximately the same wages upon returning .to work.

The deposition of Robert Pearson shows he gave his mother 7 or 8' dollars a week, and paid the laundryman and newspaper boy, averaging a total of about $10 per week; that his father pays the grocery bills, pays rent, and gives his wife “what she needs to get along on. ” John Behrens, Jr. testified that he paid $10 or $15 a week for board and room at home, and used the remainder of his income to pay on his car and clothes.

During the course of the trial Phyllis Behrens testified she did not receive any money from her brother, but that he gave it to her mother and she got it indirectly. ,The latter part of this testimony was stricken on motion of appellees, and appellants then offered to prove by the witness that for several years prior to the date of the accident John Behrens, Jr. gave her money, averaging about $10 a month, and that the money was used to buy clothes and books, to help her in attending high school. An objection to the testimony was sustained. Similar offers were made to prove that from the time Robert Pearson was 16 years of age he had contributed approximately $10 a week toward the household expenses and upkeep, and that out of his contributions, his mother had been able to save about $5 a week for her own personal use; that her husband’s income was irregular and inadequate because he was addicted to drink at different times, and that he was afflicted with an asthmatic condition which was aggravated in the summer time, and. as a consequence his ability to work at his occupation was materially reduced; that John Behrens, Sr. earned about $26 a week, and that the household expenses averaged about $145 a month; that for approximately four years prior to the accident John Behrens, Jr., contributed an average of $12 a week to the support and maintenance of the Behrens home, out of which his mother was able to save about $6 a week for her own use; and that while each of the two boys was recuperating at home the household expenses were increased on the average of $18 per week, on account of necessary special foods and medicines. Objections to the latter offer were sustained on the ground that as to the parents the pleadings did not call for damages for what they paid out. Objections to the other offers were sustained on the ground that none of the parties claiming damages for loss of means of support could recover unless there was a legal liability for such support, and that such a liability arises only under the Pauper Act.

As a basis for the recovery of exemplary damages, appellants offered to prove that at about 8 o’clock on the night of the accident, and on prior occasions, Robert Pearson’s mother came to the Shamrock tavern and protested against the sale of intoxicating liquor to him, and had been met with refusals to comply with her protests. The court sustained an objection to the testimony, and refused to admit in evidence the hospital, doctor and nursing bills.

As to the claims of Bobert Pearson and John Behrens, Jr. for damages, the trial court held, and we think properly so, that where, as here, it is shown that they repeatedly purchased rounds of drinks which contributed to the intoxication of George Verble, from which their injuries resulted, neither of them is entitled to recover. The reason is, that having by their own conduct brought the injuries upon themselves, they are not such innocent suitors as are contemplated by the statute. (Forsberg v. Around Town Club, Inc., 316 Ill. App. 661; James v. Wicker, 309 Ill. App. 397.)

Appellants argue extensively that contributory negligence is not a defense to an action under the Liquor Control Act, but appellees do not claim that it is a defense, and the question is not in issue. Lester v. Bugni, 316 Ill. App. 19, relied upon by appellants as holding contrary to the cases above cited, is hot persuasive here. The opinion in that case clearly demonstrates the difference between the question, of “provocative conduct” by a plaintiff in contributing to the single purchase of a quart of wine, and the question of contributory negligence of the plaintiff by subsequently riding in a car, which was in bad condition, with a drunken driver, after having repeatedly importuned the driver to take him home. The court held that under the facts those questions were questions of fact for the jury, and upheld a judgment for the plaintiff who was injured in an accident when the car overturned. Appellees make no claim that Bobert Pearson and John Behrens, Jr. were guilty of contributory negligence by riding with George Verble while he was intoxicated. The alleged “provocative conduct” in that case is not comparable to the admitted facts in this case.

On the question of the liability of appellees to appellants, other than Bobert Pearson and John Behrens, Jr., for loss of means of support, appellees rely upon Jury v. Ogden, 56 Ill. App. 100. In that case an unmarried adult daughter of a divorced, habitually intoxicated father, and who lived with him, but left home on account of his personal violence and threats in consequence of his intoxication, recovered a judgment in the trial court against the saloon keeper who sold him intoxicating liquor, and the owner of the saloon premises, for damages on account of personal injuries and loss of means of support. The court held she could not recover for loss of means of support, because “the means of support referred to in the statute are such as the person intoxicated would be legally bound to furnish,” and reversed and remanded the cause to be tried upon the question of personal injuries.

This restricted definition of “means of support” is not in accord with the holdings of our Supreme Court. In McMahon v. Sankey, 133 Ill. 636, a widow sued for loss of means of support by the death of her husband while intoxicated. The opinion of the court adopts the definition laid down by the Supreme Court of Ohio in Schneider v. Hosier, 21 Ohio St. 98: “In its general sense it embraces all those resources from which the necessaries and comforts of living are or may be supplied, such as lands, goods, salaries, wages, or other sources of income. In its limited sense, it signifies any resource from which the wants of life may be supplied.” It appeared in that case that the plaintiff’s minor sons gave some part of their earnings to her, but were at home idle a greater part of the time. The court said in the opinion: “Let it be admitted that she derived her means of support from two sources, that is to say, from the earnings of her husband and from the earnings of her sons. If her income from the first source was diminished or cut off by her husband’s intoxication, such injury to her means of support would be exactly the same whether she did or did not continue to draw an income from the second source.”

Under the definition of “means of support” adopted by the court, the obvious corollary is that if the income from the sons had been cut off or diminished, she would have been injured in her means of support whether she did or did not continue to draw an income from her husband.

The court pointed out in that case that the plaintiff was not entitled to the earnings of the minor children because such earnings belonged to the father during his lifetime. On this point there is an analogy in this case, because John Behrens, Jr. was an adult and Robert Pearson, being allowed to control his own services and income, was emancipated. (Iroquois Iron Co. v. Industrial Commission, 294 Ill. 106.)

The court also held in that case that the right of support is not limited to the supplying of the bare necessaries of life, but embraces comforts, what is suitable to the wife’s situation and the husband’s condition in life, and that it is enough to show that the -sources of her future support have been cut off or diminished below what is reasonable and competent for a person in her station in life, and below what they otherwise would have been.

In Gilmore v. Killion, 281 Ill. 154, a mother sued for loss of means of support through the death of her adult son by an intoxicated person. The plaintiff lived in the State of Mississippi, where she owned 78 acres of land, which she testified was not sufficient to support her and her husband. The son had been sending her money quite regularly for some time in amounts of from $5.00 up, — once as much as $40. The remittances were used to purchase the necessaries of life. The defendants insisted that in order for the plaintiff to recover, her son being an adult, it was incumbent upon her to prove she was a resident of Illinois and to bring herself within the provisions of the Pauper Act of this State, and that she had a legal right to be supported by her son; and that the fact that he made voluntary contributions for her support would not be sufficient to entitle her to recover under the statute. In answer to these claims, the court said in the opinion: ‘ ‘ There is nothing in the wording of this statute that justifies the argument of counsel on any of these points. Under the reasoning of this court in Danley v. Hibbard, 222 Ill. 88, and Nagle v. Keller, 237 id. 431, it must be held that these arguments of counsel are without force; and the further argument of counsel, in this connection, as to the mother’s means of support by her husband or from the farm she owned in Mississippi, cannot be sustained in view of the holdings of this court on a somewhat similar state of facts in Deel v. Heiligenstein, supra” (244 Ill. 239.)

These two decisions of the Supreme Court fit the circumstances in this case, and it would serve no good purpose to analyze the cases cited therein. The testimony admitted and that offered by appellants was sufficient to require submitting to the jury the question of the loss of means of support by appellants, other than Robert Pearson and John Behrens, Jr.

Under the pleadings, the trial court did not err in refusing to admit in evidence the hospital, doctor and nursing bills, or the claims for increased household expenses while the two boys were recuperating. Neither Robert Pearson nor John Behrens, Jr., was entitled to recover anything in the suit, and there is no allegation in the complaint of any property injury to any of the other appellants; and there being no claim for injury on account of the intoxication of Robert Pearson, the offered testimony as to his mother’s protests against the sale of intoxicating liquor to him, as a basis for exemplary damages, was also properly excluded.

That part of the judgment of the trial court in favor of appellees as to the claims of Robert Pearson and John Behrens, Jr. is affirmed. That part of the judgment as to the claims of the other appellants for loss of means of support is reversed and the cause is remanded with directions to proceed in accordance with the views herein expressed.

Reversed in part and remanded with directions.


source: Caselaw Access Project

author: Mr. Justice Dove

license: Public Domain

text:
    Ed. Haugens, Appellee, v. Mary E. Foster, Appellant.
    Gen. No. 9,863.
    Opinion filed August 19, 1943.
    Robert A. Barnes, of Lacón, D. M. Gregg, of Wenona, and C. B. Chapman, of Ottawa, for appellant.
    Kenton Brown, of Wenona, and H. L. Richolson, of Ottawa, for appellee.
   Mr. Justice Dove

delivered the opinion of the court.

This case involves the validity of a promissory note which included in the principal thereof the sum of $500 which was part of a prior note for $5000, and for which appellee accepted $4500 when the makers procured a new loan from the Federal Land Bank of St. Louis. The cause is here by appeal from a judgment of the circuit court of Marshall county in favor of appellee for the amount of the note, except the $500 mentioned. Appellee has assigned a cross-error 'on the failure to include the $500 in the judgment.

The record discloses that on April 25, 1934, Thomas B. Foster and Mary E. Foster, his wife, who is appellant here, executed their promissory note of that date to Ed. Haugens, appellee, in the sum of $2463, secured by a mortgage on real estate in the State of South Dakota. At that time Foster and Minnie B. Kennedy, his sister, owned, as tenants in common, 80 acres of land in Marshall county, Illinois. Foster and his wife were also indebted to appellee in the further sum of $5000, evidenced by their promissory note, dated April 25, 1934 and secured by a mortgage on Foster’s undivided half interest in the Marshall county land.

In June 1935, Foster and Minnie B. Kennedy applied to the Federal Land Bank of St. Louis for a loan on the Marshall county land, which was approved for $4500 and a land bank commissioner’s loan of $3000 was also granted them. The transaction was handled through the Marshall County National Farm Loan Association, in the name of Minnie B. Kennedy as the applicant. In order for the loan to be consummated the lender required a signed creditor’s statement from appellee, which contained the following:

as an obligation

“You hold a 1st mtg./of Minnie B. Kennedy, Toluca, for $5000.00. Kindly state below the earliest date said indebtedness can be paid, giving the amount which you will accept in full satisfaction of the same
on or before said date, or thereafter, and return this statement to me.
(Signed)
(Secretary-Treasurer or Loan Correspondent.) To Sam. W. Crabtree,
Secretary-Treasurer or Loan Correspondent and to the Federal Land Bank of St. Louis and/or Land Bank Commissioner.
The amount of the .indebtedness referred to above is $5000 as unpaid principal . . . upon which date or after which date said debt can be paid. . Said indebtedness is evidenced by a Note due on the-day of -19-. The debt is secured by a Beal Estate mortgage which is recorded in book-page - of the records of Marshall County, State of -. Upon payment to the undersigned of $4500 . . . said sum will be accepted in full satisfaction of this claim.”

After provision for assignment and delivery of insurance policies with the release and other papers, and an agreement to take the amount in Federal mortgage corporation bonds, the statement continues: “The undersigned creditor states that no understanding or agreement exists between him and the applicant that a note or other evidence of indebtedness will be given for the difference, if any, between the amount paid or to be paid the creditor and the amount of the creditor’s original claim, and agrees that directly or indirectly no note, mortgage or other consideration will be received from the debtor, incident to such acceptance, other than the consideration paid by The Federal Land Bank and/or the Land Bank Commissioner, and that when said consideration is paid all claims of this creditor against the above debtor shall have been satisfied in full.”

The indebtedness on the South Dakota mortgage was not mentioned in the creditor’s statement, and it did not call for any information as to any other obligation of the debtor to appellee except the specific mortgage mentioned therein. The record shows a financial statement signed by the applicant for the loan, showing assets of $17,695, including chattel property and “Present market value of this farm % interest $5,000. Other farming land $10,000.00,” with liabilities of “First lien on this farm $3750.00. Liens on other farms and real estate $5700.00,” and a net worth of $8245. Appellee was paid $4500 when the Federal Land Bank loan was closed.

Subsequently and on June 20, 1938, Foster and his wife executed a new note to appellee for $3,523.21, secured by a mortgage on the South Dakota land, to take up the prior mortgage on that land, and included in the note certain book accounts owing to appellee, and the unpaid $500 which was a part of the $5000 debt mentioned in the creditor’s statement. Foster afterward died, and on February 21, 1940, appellee took judgment by confession against appellant on the $3,523.21 note, in the sum of $4095, which included interest and attorney’s fees. After the return of an execution “no property found,” an affidavit for garnishment was filed, and process served on the State Bank of Wenona, which, in response to interrogatories filed, answered that it had $1985 belonging to appellant. Thereafter, on motion of appellant, leave was granted her to plead and answer the interrogatories and upon the hearing the trial court, on July 7, 1942, entered judgment, as of February 21, 1940, against appellant in the sum of $3595. This amount excludes the $500 unpaid when the Federal Land Bank loan was procured. Judgment was afterward entered against the bank in the garnishment proceeding. This appeal is from the judgment of July 7, 1942, against appellant, who contends that the entire note is void, as including an illegal consideration.

After the judgment by confession was opened with leave to defend the action, affidavits on behalf of appellant, and counter affidavits by appellee were filed by leave of court. One of the counter affidavits of appellee states that he took the creditor’s statement heretofore referred to, to “the Manager of the Marshall County Federal Land Bank office, an agent of the said Federal Land Bank of St. Louis,” and advised him that “affiant was willing to sign said Creditor’s Statement in so far as the $5000.00 mortgage was concerned, advising him that said Foster was also indebted to affiant as evidenced by a note and mortgage on land in South Dakota, and that he would not be willing to accept the sum of $4500.00 in full payment of that indebtedness; whereupon the agent of said Land Bank advised affiant that the signing of the Creditor’s Statement was a mere matter of form, and that all the Land Bank desired was to have affiant’s mortgage released so as to give the Land Bank a first lien on the Marshall County land for its loan, and the filing of the Creditor’s Statement by this affiant would not affect the other indebtedness, as the said other indebtedness had not been scheduled by said Foster in the application for said loan.” The affidavit also states that while the application for the loan was pending, Foster asked affiant if he would release the $5000 mortgage for the sum of $4500 to which affiant replied that he thought the mortgage was worth the full amount of $5000, but that he would- accept $4500, and carry the balance over and include it in the other indebtedness, to which Foster agreed, and that the new note and mortgage were executed in pursuance of that agreement.

On the trial appellee testified, over objection to the conversation with Foster. He also testified that Sam. W. Crabtree was the secretary-treasurer for the Federal Land Bank, and that they had a conversation in reference to the loan; that he signed the creditor’s statement in Mr. Crabtree’s presence, and that in the conversation the question came up as to whether Foster owed the witness any more money, and that he said: “Tes, but tbe other money would be added to the rest of the account he owed ine”; that he thought Mr. Crabtree knew of the South Dakota mortgage, and the witness told him (Crabtree) about Foster owing him other money and that he was not willing to sacrifice it; that he told him what he and Foster had decided to do, and that they were going to carry it all in one figure, to which Mr. Crabtree replied: “This is a matter of form.” His testimony in connection with the conversation with Mr. Crabtree was stricken, on appellant’s motion, as an attempt to vary the terms of a valid written instrument by parol evidence.

An affidavit by Mr. Crabtree states that he is secretary-treasurer of the Marshall County National Farm Loan Association, and has never been an agent of the Federal Land Bank “under a contract agreement”; that affiant had no authority to make any verbal agreement or promise other than those set out in the regular forms of the Federal Land Bank, and having knowledge of such, that he made no statements or promises to anybody whatsoever that the statements in any Federal Land-Bank form was merely a matter of form. He was called as a witness for appellant, but did not, in his testimony, deny any part of the conversation with -him to which appellee testified.

The affidavit of F. Earl Heinrich, a former employee of Mr. Crabtree, states that he was present when appellee signed the creditor’s statement, and signed the same as a witness; that appellee did not, in his pres- • ence, make the statements to which he testified; and that the witness did not tell him or hear Mr. Crabtree tell him, the things mentioned in appellee’s counter affidavit. The Heinrich affidavit does not purport to cover all the time that appellant was in the office, or tend to show that the conversation with Mr. Crab-tree, set out in appellee’s counter affidavit, and to which he testified, did not take place out of the hearing of the affiant. Mr. Heinrich did not testify on the trial.

Except the testimony and the affidavit of appellee that Mr. Crabtree said the creditor’s statement was a mere matter of form, his other testimony and the other matters stated in his counter affidavit were undisputed. We think the trial court erred in excluding appellee’s evidence of his conversation with Mr. Crab-tree. This testimony was not an attempt to vary the terms of a written instrument, but rather to show that by reason of the circumstances under which the creditor’s statement was signed, the creditor’s statement was, in legal effect, -no agreement at all. It has been repeatedly held that parol evidence is admissible for that purpose. (Black v. Wabash, St. L. & P. R. Co., 111 Ill. 351, 361; Wabash R. Co. v. Thomas, 222 Ill. 337; Illinois Match Co. v. Chicago, R. I. & P. R. Co., 250 Ill. 396; Toombs v. Lewis, 362 Ill. 181, 187, 188; Lennon v. Goodspeed, 89 Ill. 438.) While an element of fraud was present in the first case cited, the other cases contain no such element. It is apparent that the creditor’s statement was signed with the knowledge of Mr. Crabtree that Mr. Foster and appellee had agreed that the debt secured’ by the South Dakota mortgage and the $500 would continue as obligations of the Fosters to appellee. The counter affidavit of appellee and his testimony indicate that the book accounts,- a very small item, were incurred after the loan by the land bank ivas made, and consequently were not covered by the creditor’s statement.

The rule seems to be practically universal that where there is a secret agreement with a mortgagor who procures a loan from a Federal Land Bank or from the .Home Owners Loan Corporation for the payment to the creditor of the balance of his claim not paid by the lender, and where the creditor agrees .with the lender to accept the amount paid to him in full satisfaction of his claim, the agreement is void as against public policy. (Oregon & Western Colonization Co. v. Johnson, 164 Ore. 517, 102 P. (2d) 928; Bell v. Jones, 100 Utah 87, 110 P. (2d) 327; Kniefel v. Keller, 207 Minn. 109, 290 N. W. 218; Meek v. Wilson, 283 Mich. 679, 278 N. W. 731; Markowitz v. Berg, 125 N. J. Eq. 56, 4 A. (2d) 410; Ganchoff v. Bullock, 234 Wis. 613, 291 N. W. 837.) It is equally well settled that where such an agreement is with the knowledge of the lender, the agreement is not void. (Bay City Bank v. White, 283 Mich. 267, 277 N. W. 888; Dayton Mortgage & Investment Co. v. Theis, 62 Ohio App. 169, 23 N. E. (2d) 511; Ganchoff v. Bullock, 234 Wis. 613, 291 N. W. 837; Sirman v. Sloss Realty Co., 198 Ark. 534, 129 S. W. (2d) 602; McAllister v. Drapeau, 14 Cal. (2d) 102, 92 P. (2d) 911; Brown v. Sears Roebuck & Co., 311 Ill. App. 490.)

This leaves for determination the question of whether Mr. Crabtree’s knowledge of the agreement between appellee and Foster to continue the indebtedness secured by the South Dakota mortgage and for the payment of the $500, is imputable to the Federal Land Bank under the doctrine of agency. As a general rule, officers and agents of a National Farm Loan Association are not by law agents of the Federal Land Bank. (Federal Land Bank of Columbia v. Gaines, 290 U. S. 247, 78 L. Ed. 298; Hooper v. Federal Land Bank of Columbia, 178 Ga. 571, 173 S. E. 415; Hinds v. Federal Land Bank of New Orleans, 235 Ala. 366, 179 So. 194; Gantt v. Gunter, 225 Ala. 679, 145 So. 146.) Appellant argues from this that the knowledge of Mr. Crabtree of the agreement between appellee and Foster is not imputable to the Federal Land Bank. Section 712 of the Farm Loan Act (Code Title 12, USCA), provide for a board of not less than five directors for a farm loan association, whose duty it shall be to choose a secretary-treasurer, elect a president, a vice-president, and a loan committee of three members. It nowhere mentions a “Loan Correspondent” of such an association. The creditor’s statement signed by appellee is addressed to Mr. Crabtree as “Secretary-Treasurer or Loan Correspondent and to The Federal Land Bank of St. Louis and/or the Land Bank Commissioner.” It is not directed to the farm loan association, and does not designate Mr. Crabtree as “Loan Correspondent” of the association. While section 714 of the act does not create the relation of principal and agent between a Federal. Land Bank and a National Farm Loan Association, or its secretary-treasurer, it does not follow that the bank is without power to use the secretary of such association as its agent in a loan transaction. (Federal Land Bank of Omaha v. Houck, 68 S. D. —, 4 N. W. (2d) 213.)

Appellant does not claim that the Marshall County National Farm Loan Association had a “Loan Correspondent,” or that it was authorized to create such a position. From the wording* as to whom the creditor’s statement was addressed, including the Federal Land Bank, on a form furnished by it, without mentioning the Farm Loan Association, appellee, or any one else executing the statement, might logically conclude that Mr. .Crabtree, as “Loan Correspondent,” was acting as the representative and agent of the bank, clothed with apparent authority to act as such. Even if he was not in fact the agent of the bank, and while reasonable diligence is required of all parties in the transaction of business, it is not enough to prevent relief that appellee might have ascertained the truth had he done all within his power. (Winkelman v. Erwin, 333 Ill. 636, 640.) Agency may be proved by the relation of the parties and the circumstances under which the transaction took place. (Lake Shore Country Club v. Brand, 339 Ill. 504, 520.) Apparent authority is as effective to bind one as a principal as is actual authority given. (Northern Illinois Coal Corp. v. Cryder, 361 Ill. 274, 287; Faber-Musser Co. v. William E. Dee Clay Mfg. Co., 291 Ill. 240; 21 R. C. L. 907.) Under the facts and circumstances shown by this record, we hold that the knowledge of Mr. Crabtree as to the agreement between appellee and Mr. Foster was imputable to the Federal Land Bank under the doctrine of apparent agency, and. being so, the agreement was not void, but was valid and enforceable. The trial court erred in excluding the $500 from the amount of the judgment and the cross-error is sustained.

The judgment rendered on July 7, 1942 is reversed and the cause is remanded to the circuit court of Marshall county, with directions to enter appropriate orders, leaving the judgment rendered by confession on February 21, 1940 in full force and effect.

Reversed and remanded with directions.


author: Mr: Justice Dove

text:
    Commercial Casualty Insurance Company, Appellant, v. W. H. Pearce, Sr. and W. H. Pearce, Jr., Trading as W. H. Pearce and Company, Appellees.
    Gen. No. 9,889.
    Opinion filed August 19, 1943.
    Hollander & Hollander and B. M. Steiner, all of Chicago, for appellant.

      William T. Chism and Harold V. Snyder, both of Chicago, for appellees ,• Harold V. Snyder, of Chicago, of counsel.
   Mr: Justice Dove

delivered the opinion of the court.

Prior to 1920, W. H. Pearce, Sr., and W. H. Pearce, Jr., his son, were engaged in the construction business as copartners. In October of that year they conveyed, as such copartners, the entire assets and business of the copartnership to three trustees designated as “W. H. Pearce & Co.,” pursuant to a written common-law trust agreement between the copartners, as such, and the trustees therein named, two of whom were the said W. H. Pearce, Sr., and W. H. Pearce, Jr., the third trustee being H. E. Werth. Of a total authorized issue of 1000 negotiable, $100 par value, “Common Beneficial Interests” or shares, 350 were issued to the co-partnership, as such, in exchange for the total copartnership assets, and the trustees assumed all the copartnership liabilities. These 350 shares, being the only assets of the copartnership, were returned to the trust, and reissued to W. H.' Pearce, Sr., and W. H. Pearce, Jr., in separate amounts. H. E. Werth had no share or beneficial interest in the trust. In 1924, W. H. Pearce, Sr., being in ill health and advanced in age, resigned as a trustee, and thereafter did not engage in the business. His resignation was formally accepted on January 22,1926, and F. D. Pearce, his daughter and a sister of W. H. Pearce, Jr., was elected as a trustee in his stead. The abstract does not show that she ever owned any share or certificate -of beneficial interest. Upon the resignation of W. H.' Pearce, Sr., as a trustee, the son, W. H. Pearce, Jr., became president and the trustees thereafter were W. H. Pearce, Jr., F. D. Pearce, and H. E. Werth. In 1926 certificates of beneficial interest were issued to other persons, and at that time and at all times thereafter, W. H. Pearce, Jr., was the only original trustee who continued to act as trustee and was the only trustee who was also a beneficiary. ' Notice of the change in organization to a trust was served on all those with whom the partnership had dealt, and the declaration of trust was recorded both in Cook county and in DuPage county.

In 1929, W. H. Pearce & Co. entered into a contract with the Joint Commission of the Capitol Commission and with the Board of Regents of the University of Nebraska, for the construction of an underground high pressure steam line from the university power plant to the capitol building, and furnished a bond for the performance of the contract, with appellant as surety. This bond was executed by appellant pursuant to a written application therefor, dated July 8, 1929, and signed: “W. H. Pearce & Co. by "W. H. Pearce, Jr.” A seal was affixed, to the instrument, reading: “W. H. Pearce & Co., Chicago, Illinois, Trustee’s Seal 1920.” The application therefor contained an agreement to indemnify, save harmless and pay appellant all liability, damages, loss, costs, charges and expenses of whatever kind or nature, including counsel and attorney’s fees, incurred by appellant or its representatives, in consequence of its execution of the bond. Prior to that time appellees had no dealings as partners, trustees, individually, or otherwise, with appellant, who, at the outset, was specifically informed by W. H. Pearce, Jr., that the organization was not a corporation or a partnership, but was a common-law trust, and the stock record book and the trust agreement were exhibited to appellant’s representative.

After the completion of the underground steam line the State of Nebraska brought suit against appellant for damages on account of an alleged breach of the construction contract. The suit was successfully defended in the trial court and in the Supreme Court of Nebraska. W. H. Pearce & Co. co-operated with appellant in defending the suit, and W. H. Pearce, Jr. testified they “went broke” in so doing. Thereafter appellant brought this suit in the circuit court of Du-Page county, against appellees, for expenses allegedly incurred by appellant in defending the Nebraska suit. The action was brought under the above-mentioned provision of the application for the bond. Upon a trial by the court without a jury, judgment was entered in favor of appellees, and this appeal followed.

Appellant invokes the rule that when the beneficiaries of an alleged trust are given control over the management of the trust property, the so-called trust agreement, as a matter of law, creates a partnership. Its counsel contends that inasmuch as W. H. Pearce, Sr., and W. H. Pearce, Jr., constituted a majority of the trustees, were sole beneficiaries of the trust and had control of its business, they never, in fact, divested themselves of their control over the partnership property. They insist that the situation was the same both before and after the trust agreement was made, and that the trust agreement had no effect other than to continue the partnership relation theretofore existing between them. Counsel calls attention to the following provisions of the trust agreement: Under Paragraph Third (A) the trustees are to be three in number, but at any annual, or regular or special meeting of the trustees, the board of trustees may, by the trustees, be decreased or increased to any uneven number, not less than one or more than fifteen. Under Paragraph Fifth (A) it is provided that the trustees “may make, adopt, amend or repeal such by-laws, rules and regulations, not inconsistent with the terms of. this instrument, as they may deem necessary for the conduct of their business or for the government of themselves, their agents or representatives.” Under Paragraph Sixth (C) any trustee may acquire, own or dispose of beneficial interests in the trust to the same extent as if he were not a trustee thereof.

Appellees take the position first that if a trust agreement limits the control to the trustees, it is a valid trust irrespective of who the trustees may he and second that even if the trust in this case was ineffectual at its inception because two of the trustees and the beneficiaries were the same persons, it became valid as soon as there was a diversity in the personnel of the trustees and the beneficiaries.

In Schumann-Heink v. Folsom, 328 Ill. 321, 327, the court sets out in the opinion the well established rule in such cases, in the following language: “There are also essential differences between a business trust and a partnership, but there are times when it is difficult to determine whether the declaration of trust relieves the trustees and shareholders from liability as partners. A partnership is, in effect, a contract of mutual agency, each partner acting as a principal in his own behalf and as agent for his co-partner. (State v. Cosgrove, 36 Ida. 278, 210 Pac. 393; Fougner v. First National Bank of Chicago, 141 Ill. 124.) Where under the declaration of trust the unit holders retain control over the trustees and have authority to control the management of the business the partnership relation exists. (Frost v. Thompson, 218 Mass. 360, 106 N. E. 1009; Hart v. Seymour, 147 Ill. 598; Dunn on Business Trusts, sec. 140 et seq.) On the other hand, where the declaration of trust gives the trustees full control in the management of the business of the trust and the certificate holders are not associated in carrying on the business and have no control over the trustees, then there is no liability as partners.” (Citing numerous cases.) To the same effect is Hecht v. Malley, 265 U. S. 144, 146, and Berneson v. Fish, 135 Cal. App. 588, 28 P. (2d) 67.

We agree with the claim of appellees that the trust agreement in this case goes further than a positive vestiture of powers in the trustees, and negatives any right of control in the beneficiaries. After generally and in detail vesting complete control of the business and the property in the trustees, too voluminously set out to be repeated here, Paragraph Fourth (F) concludes with these words: “and the right of said Trustees to manage, control and administer the said trust estate shall be absolute and unconditional, free from the cóntrol or management of the Certificate Holders.” And Paragraph Ninth (C) provides: “The ownership of interests hereunder shall not entitle the Certificate Holder to any title in or to the trust property whatsoever, or . . . for an accounting, or for any voice or control whatsoever of the trust property or of the management of said property or business connected therewith by the trustees. ’ ’

Section 99 of the American Law Institute’s “Restatement of the Law” on Trusts, lays down this principle: . . there can be a trust where there are several beneficiaries who are also trustees. In such a case each of the beneficiaries has an equitable interest which is separate from the legal interest held by the whole group. As trustees they hold the legal title as joint tenants, and ordinarily they hold the beneficial interests as tenants in common.”

In Taussig Co. v. Poindexter, 224 Mo. App. 580, 30 S. W. (2d) 635, 637, it was held that where a trust agreement was of no effect when executed, because the entire beneficial interest was placed in the trustees, yet, as soon as other parties became holders of beneficial interests, so that their estate and that of the trustees was separate and distinct, and the trustees were in fact trustees for them as well as for themselves, then life was thereby imparted to the trust agreement and it became a valid instrument. No authority contrary to that decision or to the rule in the “Restatement of the Law” on Trusts is cited by appellant. In this case, the entire beneficial interests were never held by the trustees, and other persons acquired beneficial interests in 1926.

Section 6 of the Uniform Partnership Act (Ill. Rev. Stat. 1941, ch. 106%, par. 6 [Jones Ill. Stats. Ann. 97.06]), provides: “A partnership is an association of two or more persons to carry on as co-owners a business for profit.” At the inception of tbe trust in this case, one of the trustees, and later, two of them, had no beneficial or equitable interest in the trust. While the trustees, as a group, had the legal title of the corpus of the trust for the purpose of carrying on the business of the trust, none of them, as such trustee, shared in the profits, which belonged solely to the beneficiaries. The statutory definition of a partnership does not fit the factual situation here. The fact that the same persons are trustees and beneficiaries of a trust does not destroy its validity. (Burbach v. Burbach, 217 Ill. 547; Summers v. Higley, 191 Ill. 193.) There is no merit in appellant’s attempt to distinguish these cases because the settlor of the trust was a person other than trustee or beneficiary.

In Neville v. Gifford, 242 Mass. 124, relied upon by appellant, the court held that the trust agreement created a partnership but the opinion discloses that the certificate holders in that case could increase or diminish the number of trustees, remove any trustees except the original two, fill vacancies in the board, modify or alter the trust, with certain specified exceptions, and a majority in interest of the shareholders could terminate the trust at any time prior to that limited for its duration. Under analogous provisions of the trust agreement, there was a like holding in Rand v. Morse, 289 Fed. 339, and Bank of America National Trust & Savings Ass’n v. Scully, 92 F. (2d) 97, 103, also relied upon by appellant. In the trust agreement in this case, such powers are expressly vested in the trustees. Those cases have no application here. In the Schumann-Heink case, 328 Ill. 321, where the provisions of the trust agreement were comparable with those in this case, it was held that the trust was valid, and the defendant was not liable as a partner.

Appellant claims that the failure to include words of limitation of liability in the application for the bond estops appellees from asserting that appellant had knowledge of the trust, and makes the trustees personally liable. This claim of appellant that appellees were so personally liable, is inconsistent with the contention that they were not trustees at all, because of the alleged invalidity of the trust agreement, and that they were liable as partners under the prior partnership. Here the complaint alleges the defendants were partners, and the case was tried on that theory. It is now too late to claim they were trustees and liable individually for a failure to include words of limitation of liability in the application for the bond. Moreover, such a claim would eliminate ~W. H. Pearce, Sr., because he did not sign the application, yet appellant insists he is liable. Even where one of three trustees signed a note with the name of the settlor, who was also the beneficiary of the trust, “per W. L. Taylor, trustee,” whereas the trust agreement authorized such action only by all three of the trustees, the trust agreement having been exhibited to the cashier of the lending bank, and the transaction having been entered into in good faith, it was held in Equitable Trust Co. of Chicago v. Taylor, 330 Ill. 42, under the doctrine in Seeberger v. McCormick, 178 Ill. 404, that as both parties were cognizant of the facts as to the trustee’s authority, the trustee was not personally liable either ex contractu or ex delicto. In the instant case appellant’s representative examined the trust agreement, which provides in Paragraph Sixth (H) that neither the certificate holders nor the trustees shall be liable for any debt or liability contracted by the trustees, or growing out of, or arising from the execution of the trust. The trust, and not the trustees personally were liable.

The contention that appellees failed to establish that the partnership between them was dissolved and that there is no proof that W. H. Pearce, Sr., ever gave notice of his withdrawal therefrom, is based on the claim that appellant knew from the examination of the trust instrument that the trust was invalid. With this claim we are unable to agree. Furthermore, the contention is answered by the testimony that all the parties with whom the partnership had dealt were notified of the change in the character of the organization and that appellant was specifically informed that it was not a partnership, but was a common-law trust, before it accepted the application for the bond.

Our conclusion is that the trust agreement is valid, and appellees are not liable to appellant individually or as partners for any of the reasons urged. It is therefore, unnecessary to discuss other issues. The judgment of the circuit court is affirmed.

Judgment affirmed.


author: Mr. Justice Wolfe

text:
    Thomas McCue, Appellant, v. Kathryn E. Berge, Appellee.
    Gen. No. 9,888.
    Opinion filed August 19, 1943.
    Sheldon & Brown, of Sterling, for appellant.
    Robert W. Besse and Kennard J. Besse, both of Sterling, for appellee.
   Mr. Justice Wolfe

delivered the opinion of the court.

The plaintiff, Thomas McCue, filed a complaint in the circuit court of Whiteside county, alleging'that he was commissioner of highways and that prior to his term, his father had been commissioner of highways for many years; that for more than 40 years the east 40 feet of Lot 1 in the southwest quarter of section 20-21-7 from the south line north -5.97 chains and the east 20 feet north thereof had been reserved for and used as a public road; that for more than 20 years the commissioner of highways had improved said strip for public travel and it has been used extensively by the public; that although the defendants have no right or title to said strip they have assumed to exercise and assert a claim of ownership or control over said strip constituting one of the public roads of the town of Sterling, and have placed obstructions in the road which the plaintiff has been required to move; that said obstructions interfere with public travel and with the maintenance and improvement of said road and are a menace to the safety and life of those who lawfully use said public road.

Plaintiff prays that the court enter a-decree enjoining the defendants from asserting any title to said public road and from placing any obstructions thereon, or from in any way or manner impairing or damaging said public road or from interfering with the plaintiff in repairing, maintaining or widening said public road.

The defendants answered admitting that the plaintiff is and his father had been highway commissioner, hut denied the other allegations of the complaint.

Defendants set up special defenses in which they claimed that in a deed from Martins to Stanley in 1908, the grantor reserved a strip 20 feet in width along the east line of Lot 1 for a public street, and that in a deed from Stanley to Hoover in 1910 Stanley reserved the west 30 feet of the east 40 feet of the south part of Lot 1, and a 20 foot strip north of the 40 foot strip for a public highway; that there has been no acceptance by the public or any other qualified authority to said proposed dedication; that only a narrow strip of land 16 feet in width has ever been used for a public street and that all of the other land has been used by defendants and predecessors, in title, as a part of their property; that in 1936 the Martin Estates conveyed the south part of Lot 1 to Kathryn E. Berge, but the deed contained no reservations for road; that William H. Stanley has conveyed by quitclaim deed to Kathryn E. Berge all of his right, title and interest in Lot 1; that the defendant, Kathryn E. Berge, owns in fee simple the land described in the complaint, and that the plaintiff has no right, title or interest in the title which he seeks to quiet in himself as commissioner of highways.

The plaintiff filed a reply to the special defenses and admitted the deeds, but denied the allegation that there has been no acceptance of the road, also denied that Kathryn E. Berge owned in fee simple the land described in the complaint.

The case was tried before the court without a jury. The court found the issues in favor of the defendant, Kathryn E. Berge. A decree was entered according to the findings of court, and the case was dismissed for want of equity. It is from this decree that the commissioner of highways has prosecuted this appeal. Both appellant and appellee have filed briefs in this court. The appellee claims that a freehold is involved in this litigation and therefore the Appellate Court has no jurisdiction of the subject matter of the suit, and that the case should be transferred to the Supreme Court.

In the case of Roloson v. Barnett, 243 Ill. 130, the facts are practically the same as in the case that we have under consideration. The court in its opinion, used this language: ‘ ‘ The appeal was properly taken to this court because a freehold was involved. "Where the dispute is whether the public has a perpetual easement for a highway over certain land, which is the question here, a freehold is involved and this court has jurisdiction of a direct appeal. Town of Audubon v. Sand, 223 Ill. 367.” To the same effect is Taylor v. Pierce, 174 Ill. 9. The first syllabus is as follows: “Appeal from decree establishing legal existence of highway involves a freehold. A public highway is a perpetual easement, and an appeal which raises the material question of the existence or nonexistence of such highway involves a freehold.” To the same effect is the case of the Town of Manteno v. Surprenant, 277 Ill. 181.

It is our opinion that a freehold is involved in this suit, and the cause is hereby transferred to the Supreme Court of the State of Illinois.


author: Mr. Presiding Justice Huffman

text:
    Joseph J. Drobnick and Jerome P. Drobnick, Copartners, Trading as Drobnick Realty Company, Appellees, v. Old Line Life Insurance Company of America, Appellant.
    Gen. No. 9,890.

      Opinion filed August 31, 1943.
    Hall & Hulse, of "Waukegan, for appellant.
    Decker & Doolen, of Waukegan, for appellees; Bernard M. Decker,-mf Waukegan, of counsel.
   Mr. Presiding Justice Huffman

delivered tke opinion of tke court.

This is a suit by appellees to recover real estate broker’s commission. Appellant denied tkat it employed tkem as its brokers to make sale of tke premises; denied tkat tkey were tke procuring cause of suck sale; and alleged tke sale was made by a different firm of real estate brokers. Tke jury returned a verdict for appellees in tke sum of $550. Botk parties made motion for a new trial. These motions were later withdrawn by tke respective parties, and any right to file a further motion for new trial was waived. Appellant filed its motion for judgment notwithstanding tke verdict. Tkis motion was denied and tkis appeal follows.

Appellant was tke owner of two adjoining business buildings in Waukegan, located at what is described as No. 10 and 12 Genesee street. Appellees were engaged in tke real estate business in tkat city. In September 1940, they addressed a letter of inquiry to appellant with respect to the price it would take for the properties. Appellant replied, stating that if .they had a client interested in the purchase of the property, it would be glad to discuss the question of price.

Appellees claim tó have interested several purchasers and made written offers to appellant. All such offers were rejected because of inadequacy of price. Appellees talked to Mr. Zagoras, a restaurant operator in Waukegan, about the buildings in question. Appellee, Jerome Drobnick, states he advised Mr. Zagoras the purchase price asked by appellant for the buildings was $47,000. He says his client thought this was too high, and wanted to know what one of the buildings could be bought for* to which appellee replied that he didn’t think appellant would sell one building, whereupon Mr. Zagoras asked him if he could buy them both for around $32,000. Following this conversation, appellee wrote appellant in regard to the matter, to which appellant replied that the purchase price would be in the neighborhood of $47,000, for the buildings, and that the real estate department would have to submit any offer of purchase to the finance committee of appellant company for its acceptance before the same could become fixed and binding. Following this communication, appellees arranged a meeting at the office of appellant in Milwaukee. Appellee, Jerome Drobnick, and Mr. Zagoras were at this meeting where they met Mr. Stárk, a representative of appellant. It is claimed by appellee that at this conference Zagoras stated $47,000 was too much money for the properties. At the instance of Zagoras, appellee later endeavored to obtain an offer of sale on the buildings in the sum- of $37,000. Such attempt was unsuccessful. The letter from appellant declining this offer states that the original purchase price of $47,000 was the amount the committee would consider for the property.

During the month of September 1941, appellant disposed of the property at 12 Genesee street, through another real estate firm. Appellees wrote to appellant on October 2, 1941, stating that they had received information the building at 12 Genesee street had been sold, and asking if such was true. They further stated in this letter that they had endeavored to persuade their client Mr. Zagoras, to offer more than $37,000, but he definitely refused to raise the offer. To this letter, appellant on October 3rd, replied, advising appellees that the property at 12 Genesee street had been sold, stating they were sorry appellees had been unable to induce their client to increase his offer to their figure.

The property at 12 Genesee street was purchased by Mr. Zagoras through another real estate broker in Waukegan. On April 30, 1942, appellees wrote appellant claiming they were entitled to real estate broker’s commission on the sale price of this property. It appears the sale price was $20,500. Appellees claim 5 per cent commission on this amount, or $1,025. This was the amount sued for. Appellees testified further as to many conversations had with Zagoras following the refusal by appellant of his last offer of $37,000 for the buildings, and also as to a prospective purchase by Zagoras of one of the buildings, but it does not appear that appellant is charged with any notice of these discussions between appellees and their client Zagoras. The foregoing summarizes the evidence of appellees.

This appeal is based solely upon the refusal of the trial court to grant appellant’s motion for judgment notwithstanding the verdict. Appellant takes the position that appellees were never its agents to sell anything; that it was approached by them as purchasing agents for prospective buyers of the property in question ; and that appellees had no contract- of employment either actual or implied with appellant as its agents to seek out or secure a purchaser for these properties. Appellant further urges that appellees approached it in a manner merely requesting the price at which it held the buildings; and that each offer submitted by them was on behalf of their own client, and was declined because it was below the price quoted.

There is no question but that the premises were for sale to any purchaser who was willing to pay the price demanded. Appellant did nothing to prevent appellees from effecting a sale to any of their clients. Appellees were unable to procure a reduction of the sale price from appellant to meet the price their client was willing to pay. They thus failed in their negotiations between appellant and their client, the prospective purchaser. During the entire time they were trying to persuade appellant to reduce its price for the property to meet the offer of their client. This might raise the question, for whom were they acting? It is usually considered that unless wrongfully prevented by a principal, a broker must bring about an agreement in order to be entitled to his commission, and the principal may employ several brokers to sell the same property, and may sell to the buyer who is first produced by any one of the brokers, without being called upon to decide which of them was the primary cause of the sale, provided he remains neutral between them and is not guilty of any wrong. Friend v. Charles W. Triggs Co., 147 Ill. App. 427, 430; Day v. Porter, 161 Ill. 235, 237. And even though the ultimate purchaser is the same party first introduced by a broker, it is considered that there must be a period within which, after a party has declined to purchase, the owner or another broker may treat the negotiations as at an end, and institute new and independent solicitation. Weisjohn v. Bell, 316 Ill. App. 62, 66.

Appellant never listed the property with appellees for sale, nor entered into any contract or agreement with them. The negotiations arose by way of a letter of inquiry from appellees asking at what price appellant held these properties. Their attempt to secure a purchaser was purely voluntary upon their part, and they , were unable to persuade any of their clients to pay the price demanded. They never obtained from appellant a price upon either of the business buildings for separate purchase. They wrote their letter of inquiry to appellant asking at what price it held the properties in September 1940. All offers submitted by them were made on behalf of their own clients and were rejected by appellant because they were under the price quoted. It was not until September 1941, a year later, that the building located at 12 Genesee street was purchased by Mr. Zagoras through another broker.

Appellees claim to be entitled to their commission on the ground that they were the procuring cause of the sale. In this we cannot concur. The facts in the cases cited by them do not square with the facts in this case. Upon the facts existing in this casé, it will be found that the following authorities support the conclusion reached herein. Chapman v. Illinois Midwest Joint Stock Land Bank, 302 Ill. App. 282; Morton v. Barney, 140 Ill. App. 333; Weisjohn v. Bell, 316 Ill. App. 62; Rigdon v. Estate of Strong, 128 Ill. App. 447; McGuire v. Carlson, 61 Ill. App. 295; Friend v. Charles W. Triggs Co., 147 Ill. App. 427; Baldino v. Henneberry, 191 Ill. App. 368; Davis v. Gassette, 30 Ill. App. 41.

The trial court erred in denying the motion of appellant for. a judgment notwithstanding the verdict. Its action in this regard is reversed and the cause remanded with directions to grant the said motion of appellant.

Reversed and remanded with directions.


author: Justice Kiley.

text:
    Helena Reichwein, Trustee Under Last Will and Testament of Christina Reichwein, Deceased, Appellant, v. Julia R. McCarthy (Robert B. Gunterberg et al.), etc., Appellees.
    Gen. No. 42,187.
    opinion filed June 30, 1943;
    rehearing denied September 8, 1943.
    Randolph Bohrer, for appellant;
    Birchard P. Hayes, of counsel;
    John A. Zvetina, for appellee;
    Henry Pollenz, of counsel.
   Opinion by

Justice Kiley.

“Not to be published in full.”


author: Justice Wolfe.

text:
    John M. Tabor, Appellee, v. Joliet Dock Company, Appellant.
    Gen. No. 9,872.
    opinion filed August 19, 1943.
    Ray F. Faulkner, for appellant;
    Francis A. Dunn, for appellee.
   Opinion by

Justice Wolfe.

Not to be published in full.


text:
    Robert Davis and William G. Handel, Appellees, v. Earl Bickelhaupt, Appellant.
    Gen. No. 9,878.
    opinion filed August 19, 1943.
    Ralph M. Eaton, for appellant;
    Melvin Einer and J. D. Turnbaugh, for appellees;
    Lawrenee A. Smith, of counsel.
   Opinion by

Justice Wolfe.

Not to be published in full.


text:
    People of the State of Illinois, Appellee, v. Flora L. Sandvoss et al., Defendants (George L. Thon, Appellant).
    Gen. No. 9,871.

      Opinion filed July 8, 1943.
    Rehearing denied October 5, 1943.
    Leonard C. Mead, of Geneva, Ill., and Gordon Moffett, of Naperville, for appellant.
    Lee E. Daniels, State’s Attorney, for appellee; Thomas H. Price, of Wheaton, Robert J. Scott, of Glen Ellyn, and George H. Bunge, of Downers Grove, of counsel.
   Mr. Presiding Justice Huffman

delivered the opinion of the court.

This was a proceeding under paragraph 216 of the Revenue Act (ch. 120, sec. 697, Ill. Rev. Stat. 1941 [Jones Ill. Stats. Ann. 119.713]), to foreclose a lien for general taxes and special assessments against a tract of real estate situated in Du Page county. Decree for sale was entered, sale had, and decree confirming' report of sale. Appellant Thon filed his petition to vacate the decree approving the report of sale, on the ground of inadequacy of price. The petition to vacate was denied, and appellant brings this appeal.

Inadequacy of price is the only ground embraced in the petition to vacate. Appellant makes no assignment of error, but in his brief, argues additional reasons for reversal. These reasons might be said to fall within two general groupings — first, that he was a holder of one of the special assessment bonds, and was not made a party to the suit to foreclose; second, that the action to foreclose for special assessments could not be joined with the action to foreclose for general taxes, and the State’s Attorney was not a proper person to institute the suit.

Appellee with respect to petition to vacate, replies that a tax foreclosure sale will not be disturbed for mere inadequacy of price, in the absence of proof of fraud or some fatal irregularity. This is the general rule with respect to other forms of judicial sales and is based on the fundamental principle that public policy requires stability to such sales. Shultz v. Milburn, 366 Ill. 400. The same rule has been held to apply to tax foreclosure sales. People v. Anderson, 380 Ill. 158.

With respect to appellant’s contention that a bondholder should be made a party to such proceeding, we find that bondholders are not considered necessary parties to an action of foreclosure of special assessment lien. Village of Lansing v. Sundstrom, 379 Ill. 121. Appellant urges that being a holder of one of the local improvement bonds, he was beneficially interested in the proceeds from the sale of the property. It clearly appears from observations made in the case of People v. Home Real Estate Imp. Corp., 379 Ill. 536, that the fact one would receive part of the taxes collected by virtue of such a sale, is not sufficient to permit him to file objections to the confirmation of the sale on the ground of inadequacy of price. This case was transferred to the Appellate Court of the first district, where the order of the trial court denying the right to file such objections to the confirmation of sale was approved. (316 Ill. App. 437.)

With respect to appellant’s contention'that the action to foreclose for special assessments cannot be joined in the same suit with an action to foreclose for general taxes, we find it is held in the case of People v. Taylorville Sanitary Dist., 371 Ill. 280, that in the making of the delinquent list, and entering judgment for sale, and selling, no distinction is made between general taxes and special assessments; that when it comes to entering judgment, the law provides it shall be for taxes, special assessments and penalties; and that when sale is made, it must be to the person bidding the amount of such taxes and special assessments due, with the least rate as penalty; and that if it does not sell, the property is forfeited to the State (p. 284). On p. 286, of the same case, it is said with respect to the sale of land for delinquent general taxes and special assessments that, “the statute clearly contemplates there will be but one sale, and that for the total amount of the general taxes and special assessments certified as delinquent, and in case there is no sale, the property is to be forfeited to the State. When suit is brought to foreclose the lien of the taxes so forfeited, there is but one sale to realize the amount then due under the several forfeitures, • . . . .” Thus we see that one action may be had for general taxes and special assessments, to realize the amount due under the several forfeitures.

As to appellant’s contention that the State’s Attorney is not a proper person to institute this suit, we find it is held in People v. Home Peal Estate Imp. Corp., supra, on p. 538, with respect to general taxes, that such a suit shall be brought in the name of the People, and that the State’s Attorney is the proper party to institute the suit.

Thus, we see that the State’s Attorney is a proper person to institute a suit of this character where general taxes are concerned, and further, when there is also a forfeiture for special assessments, suit to foreclose such lien may be joined with the suit to foreclose the lien for general taxes. Therefore, it must be concluded'that the State’s Attorney was a proper person to institute this suit.

Due to the disposition made of this case, the motion of appellee to dismiss the appeal has not been considered.

The order of the circuit court denying appellant’s motion is affirmed.

Order affirmed.


text:
    In re Estate of Minnie E. Feldman, Deceased. Gertrude VanZele, Executrix of Will of Leon VanZele, Deceased, Appellant, v. Jay J. Smaltz, Executor of Will of Minnie E. Feldman, Deceased, Appellee.
    Gen. No. 9,882.
    Opinion filed August 19, 1943.
    Rehearing denied October 5, 1943.
    Joseph L. Shaw, of Geneseo, and John H. Armstrong, of Ottawa, for appellant.
    J. J. Ludens, of Sterling, and John A. Fletcher, of Morrison, for appellee.
   Mr. Justice Wolfe

delivered the opinion of the court.

On March 1, 1931, Minnie E. Feldman executed her promissory note for $3,000 payable to James C. Feldman. The note with indorsements is in substance as follows; “Morrison, Ill., March 1st, 1931. On or before date we jointly and severally promise to pay James C. Feldman, or order, the sum of $3000.00 Three Thousand & 00/100 dollars, with interest at the rate of 5 per cent, per annum from date until paid, payable annually. Value received. Both principal and interest payable at the Smith Trust & Savings Bank, Morrison, Illinois.

(Regular judgment note clause, etc.)

Due Mar. 1, 1939. (Signed) Minnie E. Feldman. ”

The note contains two indorsements. First to Leon VanZele as follows (Abst. 2):

James C. Feldman Assigned to Leon VanZele.”

And second to Hazel Feldman as follows (Abst. 2):

“I hereby assign the within note to Hazel Feldman, subject, however, to the interest and right therein of Leon VanZele, who now holds the said note as collateral security for a debt due him from Hazel Feldman. The within note is now in the possession of said Leon VanZele, who has permitted me to make this endorsement. When Hazel Feldman has paid her note to said Leon VanZele he is to surrender the within note to her.
(Signed) James C. Feldman”

Minnie E. Feldman died February 20,1941, and Jay J. Smaltz was appointed executor of her estate. Leon VanZele died December 26, 1933, and Gertrude VanZele was appointed executrix of his estate. On June 20, 1941, Gertrude VanZele, as such executrix, filed the above note as a claim against the estate of Minnie E. Feldman, deceased. The executor of the estate of Minnie Feldman filed objections to the claim. The case was heard in the county court of Whiteside county and the claim was disallowed. An appeal was perfected to the circuit court of said county and a hearing had before said court. The claim was again disallowed. It is from this order that an appeal has been perfected to this court.

It will be observed from an examination of the note that it is dated March 1, 1931, and then follows: ‘ On or before date” we jointly and severally promise to pay, etc. In the lower left-hand corner of the note are the words and figures “Due Mar. 1, 1939.”

The question now arises, what is the real due date, of this note? If the words, “Due Mar. 1,1939,” is not considered, we think there is no question that the court properly held that this note was due on the date it was executed, vie., Mar. 1, 1931. The question then arises whether the writing, “Due Mar. 1, 1939,” has any bearing on the obligation of Minnie E. Feldman to pay the note. We think it is the universal custom of bankers, — when receiving a note either before or after its execution,- — to fill in the due date in the blank space in the left-hand corner, but it is considered no part of the note itself, but merely a convenience for the bankers for reference as to when the note is due and payable.

Our attention has not been called to any case in Illinois in which this question has ever been passed upon, but wé find in vol. 8 of Corpus Juris under bills and notes on page 193 the following: “Where the body of the note and a marginal memoranda differs as to the date of maturity, the date in the body of the instrument is controlling.” In Corpus Juris Secundum in vol. 10 on page 481, we find the following: “Memoranda which are repugnant to the body of the instrument or self-contradictory do not become part of the instrument and do not control as against its provisions, unless it is shown that such notation on the instrument was made to correct a mistake therein. Thus, where a marginal memorandum differs from the body of the instrument as to the date of maturity, the date in the body of the instrument is controlling.”

The Supreme Court of the State of Nebraska in the case of Fish v. McNeal, 23 Neb. 726, 37 N. W. 616 had this same question before it for consideration and in their opinion the court used this language: “The question presented for decision is, does the filling of the blank in the lower margin of the notes, naming a date for their maturity, make the notes payable on such dates, instead of the date named in the body of the note? The testimony shows that, at the time of and prior to the execution of the notes, defendant resided in Franklin Grove, in the State of Illinois, and was indebted to plaintiff in the sum of $105. Plaintiff demanded payment, but was informed by letter from defendant, dated June 25, 1878, that she could not make the payment at that time, but would be able to do so the coming fall — by the middle or last of September. She was then requested to execute her notes for the amount due, and send them to plaintiff, which she did; the notes being the ones sued on in this case. It may be assumed, also, that the notes were written by her in the form in which they now appear, and it may be that she intended to make them payable at the time designated in the margin. It may also be assumed that plaintiff so treated them as a favor to defendant, and so relied upon them. But while this is a matter which, if true, should appeal strongly to the conscience of a debtor, we, not being the conscience keepers of litigants, must decide the case according to the law as we find it applicable to the contract which the parties have made. As may be seen by the notes, they fix a definite time within which they mature, — “ten. days after date. ’ ’ It cannot be said, as matter of law, that the marginal note or memorandum could any more.control the body of the note than could the marginal figures, when different from the amount expressed in the body, or written portion of the note, control the amount which a holder would be entitled to upon payment or judgment. Upon this point, we tliink the American cases are .substantially uniform, that, where a difference appears between the words and figures, evidence cannot be received to explain it; but the words in the body of the paper must control. 1 Daniel, Neg. Inst., par. 86, and cases there cited. Hence, if an alteration is made in the marginal figures, so as to make them correspond with the writing, it is not such an alteration as to vitiate the note. In Smith v. Smith, 1 R. I. 398, the court said: “"We do not think the marginal notation constitutes any part of the bill. It is simply a memorandum or abridgement of the contents of the bill for the convenience of reference. The contract is perfect without it. If this is so, any alteration in the figures cannot avoid the contract, because it is no alteration, either material or immaterial, in the contract.” See, also, Rand. Com. Paper, par. 105. So we think it must be in this case. The marginal memorandum is only for convenience in the matter of ascertaining the date of the maturity of the note, without the necessity of reading it.

In the case of Danforth v. Sterman, 165 Iowa 323, 145 N. W. 485, the Supreme Court of Iowa also had this question before it. By its terms, the note in the suit was due June 1, 1911, and was assigned to the plaintiff on May 18th of that year. In the lower left-hand corner of the note, and in the margin, after the printed word “due,” was written the word and figures “May 15, 1911,” making the sentence read, “Due May 15,1911,” which, if correct, was before the transfer of the note. Defendant insisted that this memorandum became a part of the note and was controlling as to its maturity, and that the court erred in instructing the jury that the instrument matured June 1, 1911. The court held that upon the record, it was clear that the memoranda date of May 15, 1911, did not control or affect the terms of the note itself, and the court properly instructed the jury that the note was due June 1, 1911, as written in the body of the note. To the same effect is the case of Sharpe v. National Bank of Commerce decided by the Court of Appeals of Texas, reported in vol. 272 Southwestern 321, at page 327.

In the case of the Union State Bank of Minneapolis, Minnesota v. Benson, 38 N. D. 396, 165 N. W. 509, the Supreme Court of North Dakota held that the date, as written in the body of the note, was the due date of the note and a marginal reference of a different date had no bearing upon the due date of the note, and was no part of it, but merely for the convenience of the holder of the note. In the case of Rivet & Sons v. Durand, 53 R. I. 48, 163 Atl. 476 (Supreme Court of Rhode Island) the court held that where the marginal notation, which does not purport to be a collateral agreement, but only a restatement of the amount, or date of the note is in conflict with the terms in the main body thereof, it will be disregarded as not being a part of the note.

It is our conclusion that in the present case the words “Due March 1, 1939,” was no part of the note and did not control in any way, the due date thereof.

The record shows that Minnie E. Peldman continued to reside in the county where the note was executed, until her death and no demand was made upon her for payment of the note. The court held that the holder of the note had slept on his rights, until such time as the note would have been barred within a few days by the statute of limitations. A few days before the statutory 10-year period of limitations expired, Minnie E. Feldman died, which automatically gave the holder.of the note an extension of time in which to present his claim in the probate court. The court held the claim was stale and disallowed the same.

The record shows that James C. Peldman was in 1933 declared a bankrupt, and that Minnie E. Peldman filed a claim against the bankrupt estate for several thousand dollars; that the referee in bankruptcy in adjudicating the accounts between the bankrupt and Minnie Feldman charged her with the amount of this note and deducted the amount due on the note from the amount due from bankrupt estate to her. This note was presented to the bankruptcy court by the assignee, Leon YanZele, and the note was filed as an exhibit in the case. Leon YanZele had knowledge of the bankruptcy proceedings, and the referee’s findings and while he was not a party to the suit, he made no effort from the time he procured the note, to enforce the payment of it. Onr Supreme Court in the case of Chapman v. American Surety Co., 261 Ill. 594 states: ‘ ‘ That this court has frequently stated that the probate court has a sort of equitable jurisdiction over claims, presented to it for allowance. In the allowance of claims against an estate, the county court may adopt the forms of proceedings in equity. It possesses a similar jurisdiction and may adopt a similar mode of procedure in the adjustment of guardians’ accounts. ... It lies in the nature of these courts that in the exercise of their jurisdiction they are not confined to legal principles or the rules of common law courts, but exercise equitable powers as well. Whenever, within the scope of their statutory jurisdiction, the relief, to be administered, the right to be enforced or the defense of an action properly pending before them involves the application of equitable principles,' their powers are commensurate with the duties demanding their exercise, whether legal or equitable.”

After considering all the evidence in the case, it is our conclusion that the trial court properly held that the claimant was not entitled to recover on this claim, and that the claim had become stale and the owner of the note was guilty of laches in not attempting to collect it before the death of Minnie Feldman.

The judgment of the trial court is affirmed.

Judgment affirmed.


author: Mr. Presiding Justice Huppman

text:
    Eugene Kavanaugh, Minor, by Maurice Kavanaugh, His Father and Next Friend, Appellee, v. Jeanne Washburn, Formerly Jeanne Parret, Appellant.
    Gen. No. 9,873.

      Opinion filed August 31, 1943.
    Rehearing denied October 5, 1943.
    Sears, O’Brien & Streit, of Aurora, and Barr & Barr, of Joliet, for appellant; Barnabas F. Sears,' of .Aurora, and Ralph C. Murphy, of Joliet, of counsel.
    Ray F. Faulkner and Robert E. Higgins, both of Joliet, for appellee; Ray F. Faulkner, of Joliet, of courisel.
   Mr. Presiding Justice Huppman

delivered the opinion of the court.

This case grows out of a collision between an automobile driven by appellant and a bicycle ridden by appellee. It was before this court upon a previous appeal (310 Ill. App. 429), and subsequently before the Supreme Court (379 Ill. 273).

The accident happened on the afternoon of August 2, 1937. Appellee and a companion were riding south on State Highway 59, on their bicycles. It was a usual two-lane, concrete highway with the lanes of travel separated by a black line down the middle of the pavement. The road ran north and south. The boys were riding along the west side of the pavement, in the traffic lane for southbound travel. Appellant was approaching from the north. The road was straight and level. It appears appellant sounded the horn of her car a considerable distance back of the boys, whereupon appellee’s companion turned his bicycle off the pavement and upon the shoulder of the road along the west side of the highway. Appellee continued traveling south upon the pavement and in the traffic lane provided for southbound travel. Appellant continued driving her car south until she came to a point where she was about to pass appellee by turning the car into the traffic lane on the east side of the pavement which was for northbound travel. While thus in the act of passing appellee, he suddenly swerved the bicycle to his left across the center of the pavement and into the traffic lane in which appellant was then traveling. A collision occurred resulting in this suit by appellee to recover for injuries sustained. There is evidence appellant sounded her- horn when she observed appellee turning from his traffic lane, but such warnings were unavailing.

The case is now before this court upon an appeal from an order of the trial court granting a motion for a new trial. The jury returned a verdict of not guilty. Plaintiff appellee filed a motion for new trial. This motion was granted for reasons assigned by the trial court in writing. The reasons so assigned are based entirely upon instructions given on behalf of the defendant below. This appeal thus presents a question as to the correctness and propriety of the instructions referred to, under the evidence in the case. Since the reasons assigned by the trial court for the granting of the motion for new trial deal entirely with instructions, it is assumed the trial court was satisfied'with the finding of the jury on questions of fact.

The object of the present review is to determine if a just conclusion has been reached, founded upon competent and sufficient evidence, and that no prejudicial error occurred with respect to the rights of the complaining party, because of the instructions involved. It is not necessary to reverse a judgment because of harmless error. People v. Jorczak, 366 Ill. 507, 516; People v. Booker, 378 Ill. 334, 345.

Where the verdict is supported by the evidence, the test generally applied to instructions complained of, is whether they were prejudicial to the rights of the complaining party. Reference to some forty of the various jurisdictions will be found in 5 C. J. S., par. 1763, p. 1092, and a similar number of jurisdictions in 3 Am. Jur., par. 1122, p. 639', to the effect that an erroneous instruction will not constitute a ground for reversal unless the complaining party has been prejudiced thereby. The same rule applies with reference to a mere inaccuracy in an instruction. Deference to some thirty-five jurisdictions will be found in support of this in 5 C. J. S., par. 1763, p. 1107. This state will be found included in the foregoing authorities.

Defendant’s instruction 3 is the old form telling the jury that if they believe a witness had wilfully and knowingly testified falsely to any material fact, the jury might disregard their testimony, except where corroborated by other credible evidence or by facts and circumstances in evidence. Appellee insists this instruction was erroneous under the holding in People v. Flynn, 378 Ill. 351, 355, because it did not tell the jury what constituted the material facts. However, an instruction was given which in detail set out the nature of the case, the issues necessary for plaintiff to prove, and those necessary for the defendant to prove, in order to maintain their contentions. We consider this sufficient.

Defendant’s instruction 7 is objected to. This instruction advised the jury that if they believed from the evidence the plaintiff in the exercise of ordinary care and caution “could” have avoided the accident and neglected and failed so to do, and that such negligence caused or proximately contributed to the injury, then the plaintiff could not recover. The objection is made to the word “could,” appellee urging that the word “would” should have been used in connection with the words “have avoided the accident,” and that it was error to use the word “could.” We do not believe the jury was confused or misled by use of the word “could” instead of the word “would,” or that any different impression was created on the minds of the jury by use of the word “could” than'would have been by nse of the word “would.” In other words, to assume the jury made any distinction between the use of these two words, in its consideration of the evidence, is too highly speculative to now influence the disposition of this case.

Defendant’s instruction 12 is objected to. It deals with a situation where plaintiff suddenly and without any fault on the part of the defendant, places himself in a position of danger. Among other things, it tells the jury that in order to charge the defendant with negligence, the plaintiff must “show” that the defendant had time and opportunity to become conscious of the situation, and by the exercise of due care, an opportunity to perform his duty towards plaintiff. It is urged here that the use of the word “show” is error. Appellee urges that the plaintiff is not required to show anything but is only required to prove his case by a preponderance of the evidence, citing in this respect, the case of Hughes v. Medendorp, 294 Ill. App. 424, 428, 429. We are not of the opinion the word “show” confused or misled the jury. In the ordinary use of language as understood by an average juror, the word merely advised the jury that the plaintiff must present evidence tending to prove such fact.

Appellee urges that the giving of certain instructions by defendant ending with the words, “you should find the defendant not guilty,” constituted error because of an excessive number of such instructions. There are some six or seven of defendant’s instructions which end in such words, or in a similar expression. This is a form of instruction that should be used with due discretion. However, we do not consider the trial court erred in this regard in the present case.

We find nineteen instructions given on behalf of defendant, and twelve on behalf of plaintiff. The jury appears to have been fully instructed on behalf of both parties to the suit. If the instructions as a whole when viewed in the light of the evidence, show no tendeucy to confuse or mislead the jury with respect to the principles of law applicable to the issues in the case, then minor irregularities when considered as an abstract proposition of law should not be permitted to control, where it appears the complaining party’s rights have not thereby been prejudiced. Juries are not versed in legal phraseology nor fine legal distinctions. Instructions are handed to the trial judge at the close of the case and just before argument. Naturally, they are partisan in character, with each litigant endeavoring to present his contentions in as skillful and forceful manner as possible. It is inevitable that a trial judge in the midst of a hotly contested case will sometimes fail to detect all of the language of the various instructions that may be inadvertently used. However, modern tendency favors a liberal application of the harmless error doctrine to instructions when it appears the rights of the complaining party have in no way been prejudiced. This situation is Well expressed by the Supreme Court of this State in the following language:

“The office of instructions is to give information to the jury concerning the law of .the case for .immediate application to the subject matter before them. The test, then, is not what meaning the ingenuity of counsel can at leisure attribute to the instructions, but how and in what sense, under the evidence before them and the circumstances of the trial, ordinary men acting as jurors will understand the instructions.” Reivitz v. Chicago Rapid Transit Co., 327 Ill. 207, 213.

In reviewing orders granting motions for new trial, this court will recognize the distinction between such motion when based upon the evidence and when involving questions of law. In re Estate of Velie, 318 Ill. App. 550.

As indicated by the Supreme Court in the case of Chicago City Ry. Co. v. Shaw, 220 Ill. 532, at p. 536, absolute accuracy with respect to instructions is a thing seldom to be attained, and the courts for the want of it, should not set aside verdicts, unless such inaccuracy is of a character that the court must feel was likely to have misled the jury. Also see Palmer v. Miller, 310 Ill. App. 582, 595; Bobalek v. Atlass, 315 Ill. App. 511, 525.

In view of the foregoing and after a review of the record, we do not consider the instructions complained of tended to confuse or mislead the jury, or that the complaining party’s rights were in any way prejudiced thereby.

The order of the trial court granting a new trial is reversed, and the cause remanded with directions to enter judgment on the verdict.

Reversed and remanded with directions.