text:
    Lola Blarjeske and Lovina Black, Appellees, v. Thompson’s Restaurant Company, Appellant.
    Gen. No. 43,112.
    Heard in the third division of this court for the first district at the June term, 1944.
    Opinion filed February 14, 1945.
    Released for publication March 5, 1945.
    Ross, Berchem & Schwantes, of Chicago, for appellant.
    R. N. Wyckoff, of Chicago, for appellees; John B. King, of Chicago, of counsel.
   Mr. Presiding Justice Burke

delivered the opinion of the court.

In a complaint filed in the superior court of Cook county Lola Blarjeske and Lovina Black alleged that Thompson’s Restaurant Company, a corporation, operated restaurants in the City of Chicago; that it operated a restaurant at 111 East Chicago avenue in that city; that it invited the public generally to purchase and eat food on, as well as off, its premises; that on December 13, 1940 plaintiffs accepted the implied invitation to enter and become customers and to purchase food to be consumed off the premises; that they purchased a roast beef sandwich; that each of them ate one half of it; that the defendant warranted to them that the sandwich was pure, wholesome, free from any poisonous substance or taint and was fit for human consumption; and that the defendant breached the warranty, in that it served a sandwich which was impure, unwholesome, harmful and tainted, the eating of which caused plaintiffs to become sick and ill; and they claimed damages for pain and suffering, medical expenses and loss of earnings. No allegations of negligence were made. An answer categorically denied the allegations. A trial before the court and a jury resulted in a joint verdict in favor of plaintiffs for $600. Motions for a directed verdict, for judgment notwithstanding the verdict, and for a new trial, were denied, and judgment was entered on the verdict. This appeal followed.

On December 13, 1940 and for many years prior thereto defendant operated a restaurant at 111 East Chicago avenue in the City of Chicago. This restaurant was one of many similar restaurants it operated in the city. Defendant purchased all of its meat from packers located in Chicago, namely, Swift, Armour, Cudahy and Wilson. By the testimony of its superintendent who had charge of the commissary supplying all its restaurants and general supervision of the restaurant at 111 East Chicago avenue, the meat buyer, the manager of the restaurant and the cook who had sole charge of the roasting of the beef and the service of the roast beef orders during the relevant time, defendant established that the meat used in its restaurants was received at a commissary operated by the defendant and was there cut to size for cooking and delivered to the various restaurants as required by the managers. In December 1940 the restaurant at 111 East Chicago avenue ordered a cut of sirloin of beef and this was delivered daily between 7 and 8 o’clock in the morning. Each piece of meat was wrapped individually. The beef, after being unwrapped, was placed in the oven for roasting. The beef was roasted approximately three hours and was ready for the noon trade, which began to appear about 11 o’clock. The only beef served at the restaurant was cut from the piece thus prepared. No cold beef was retained on hand when the restaurant was closed in the evening. Fresh beef was prepared daily at the restaurant. In the evening, when closing, any roast beef remaining was thrown out, regardless of the amount, along with all other cooked foods. Only two kinds of beef sandwiches were dispensed, namely, hot beef, which consisted of beef sliced from the roast and covered with hot gravy, and a plain beef sandwich (sometimes known as a cold roast beef sandwich) which was cut from the same roast, but served without gravy. The cook testified that she had been employed continuously at the same restaurant for approximately 12 years prior to December 13, 1940; that no roast beef was ever retained on the premises other than that cooked daily and that roast beef containing mold or a green growth was never served at the restaurant during the time that she was the cook, which included the day in question. At the time she testified she was employed elsewhere and had no interest in the outcome of the litigation. None of defendant’s witnesses testified as to the specific meat purchased by plaintiffs.

In December 1940 plaintiffs were co-workers in an apparel shop located on North Michigan avenue. Each earned $20 a week, altering garments sold in the shop. It was customary for the plaintiffs and some of their fellow workers to eat lunch at a table provided by their employer, located in the basement of the establishment. A small electric grill was available for making coffee, some of the employees brought food from home and one usually purchased food from the outside, frequently from defendant. On December 13, 1940 Mrs. Della Marie Bratt, a fellow worker, went to defendant’s restaurant at 111 East Chicago avenue and purchased the food for the lunches. Before leaving her employer’s premises she spoke to the employees who contemplated lunching there, and was asked by plaintiff Lola Blarjeske to purchase a chicken pie, and by plaintiff Lóvina Black to purchase a roast beef sandwich. Both of these items were purchased by Mrs. Bratt from the defendant. On her return she delivered the chicken pie to Mrs. Blarjeske and the roast beef sandwich to Mrs. Black. The roast beef sandwich consisted of two pieces of white bread, sirloin of beef and some lettuce. When delivered to Mrs. Bratt, it was cut in half, and wrapped in a paper napkin. The roast beef sandwich was placed in a paper bag. The employees of defendant knew that the sandwich and chicken pie were to be taken out. While Mrs. Blarjeske consumed the chicken pie, Mrs. Black ate half of the roast beef sandwich. She did not observe how' the sandwich tasted other than that it didn’t taste good and made no comment about it other than to offer one half of it to Mrs. Blarjeske, when the latter stated she was still hungry after finishing her chicken pie. Mrs. Blarjeske ate approximately half of the half that remained of the roast beef sandwich and made comment on its dark color and how dry it was. She wrapped the unconsumed portion in a napkin and threw it into a trash box. Mrs. Bratt, who brought the sandwich from the restaurant, saw the roast beef both at the luncheon table and at the doctor’s office. She testified that it was thick and brown and looked like an end cut, also that it was dark, discolored and grayish. She heard Mrs. Blarjeske comment on how dry it was and say, “What a color.” There was nothing unusual about the lettuce in the sandwich. Mrs. Blarjeske described the meat as “sort of blackish, brown, real dark and dry, ’ ’ and as ‘ ‘ dark brown.” She also testified that one side of the meat was “sort of greenish, funny color,” and that “this was just around the edges.”

Mrs. Black testified that she never opened up the sandwich, but that she observed it and ate half of it. She stated that “I didn’t think there was anything wrong with it or I would not eat it myself. I made no mention to her [Mrs. Blarjeske] when I gave her half that it didn’t taste all right.” Dr. Robert J. Moses, who had an office in the building in which plaintiffs worked, testified that he saw the unconsumed portion of the sandwich and that the beef had a deep fungus growth on it, a green material or mold, which covered its entire area; that he telephoned the Health Department, but did not deliver the sample to that department, or undertake to have it analyzed. He did not take it to any of defendant’s employees or confer with them about-it. After keeping it in his possession about three days he threw it in the waste basket. Within a period of from 15 to 45 minutes after lunch Mrs. Black and then Mrs. Blarjeske became ill and vomited and suffered from diarrhea for approximately two hours before they were taken to the office of Dr. Moses. Up to that time they were both in good health and worked steadily. The only thing they ate in common that day was the roast beef sandwich. Dr. Moses kept them under treatment in his office for about two hours, during which time he pumped' their stomachs several times. Dr. Moses testified to finding pieces of meat with green mold affixed in the washings from their stomachs. Plaintiffs were then taken to the North Chicago ■ Hospital, where they remained under treatment for four days. Each plaintiff paid $6 for the ambulance ride to the hospital. Each received a hospital bill of $18.90. They denied receiving any bill from the doctor. He testified that he sent each an identical bill for $100. Nothing had been paid to the hospital or to the doctor at the time of the trial. After leaving the hospital both plaintiffs were given further treatments by Dr. Moses. Mrs. Blarjeske was off from her work from December 13,1940 to the early part of January 1941 on account of her illness. Mrs. Black went back to work about the first of the year. There is no complaint that the verdict is excessive.

Defendant, while denying a sale of roast beef having a green fungus growth attached to it, maintains that there is no evidence to prove a causal connection between -the consumption of the roast beef sandwich arid the subsequent illness of plaintiffs. Although Dr. Moses kept a portion of the unconsumed meat for three days, he made no attempt to have it analyzed. Although Dr. Moses testified for plaintiffs, he was not at any time asked to state his diagnosis, no hypothetical question seeking to establish a causal connection was propounded to him, and he did not testify that there might or could have been, or that there was any causal connection between the eating of the roast beef sandwich and the subsequent illnesses of plaintiffs. The jury was required to speculate upon that issue. Assuming that the meat had a covering of green mold, there is no evidence that the green mold could, might or did cause plaintiffs’ illnesses. The burden was on plaintiffs to show a causal connection between the eating of the roast beef sandwich and their subsequent illnesses. A jury cannot be allowed to determine disputed questions of fact from mere conjecture. Bowman v. Woodway Stores, 345 Ill. 110; Walraven v. Sprague, Warner S Co., 235 Wis. 259, 292 N. W. 883; Coca-Cola Bottling Co. v. Wood, 197 Ark. 489, 123 S. W. (2d) 514. Because of the failure of plaintiffs to make the necessary proof as to the cause of their illnesses, defendant asks that the judgment be reversed without remandment. We are of the opinion that the judgment should be reversed, but that the parties should be given an opportunity to retry the case.

The second point presented by defendant is that since plaintiffs did not purchase the sandwich from defendant, they cannot' claim advantage of an implied warranty. Defendant points out that the complaint alleges that plaintiffs entered the restaurant of defendant and purchased a roast beef sandwich; that the proof does not sustain this allegation, but discloses that the purchase was made by a third party, who under the evidence could have been considered the agent of plaintiff, Bovina Black, and that she could not be the agent of Lola Blarjeske with respect to the roast beef sandwich. We agree with defendant that Mrs. Blarjeske was a contractual stranger to both the defendant and her coplaintiff, Mrs. Black. She received her half of the sandwich as a gift from Mrs. Black. Defendant states that as to Lola Blarjeske there was clearly no implied warranty running from defendant since she had no contractual relation with defendant with respect to the roast beef sandwich and was not in any degree of affinity by blood, contract or law with her coplaintiff, the donor of the portion of the sandwich which Mrs. Blarjeske consumed. In the case of Welter v. Bowman Dairy Co., 318 Ill. App. 305, we gave careful consideration to the proposition as to whether an implied warranty in the sale of milk in bottles extends beyond .the immediate purchaser. There are a number of cases from other jurisdictions which hold that the implied warranty does not extend beyond the immediate purchaser. In the Welter case we held that the implied warranty that the milk was fit for human consumption extended to the plaintiff, although she was not the purchaser. The Welter case was followed in Haut v. Kleene, 320 Ill. App. 273. We are of the opinion that the implied warranty that the roast beef sandwich was fit for human consumption extended to both plaintiffs, although there was no contractual relation between defendant and Mrs. Blarjeske, one of the plaintiffs.

The third point urged by defendant is that the court erred in instructing the jury that there was an implied warranty running from the defendant to plaintiffs. Our determination that the implied warranty runs to both plaintiffs disposes' of this point.

Finally, defendant argues that should we reverse the judgment in favor of Mrs. Blarjeske, the entire judgment would be vitiated, as it was a joint verdict and a joint judgment. Plaintiffs concede that a reversal as to one plaintiff would require a reversal as to both. As we are reversing the judgment, it is unnecessary to pass on this point.

The judgment of the superior court of Cook county is reversed and the cause remanded with directions to proceed in a manner not inconsistent with this opinion.

Judgment reversed and cause remanded with directions.

Kiley and Lupe, JJ., concur.


source: Caselaw Access Project

author: Mr. Presiding Justice Burke

license: Public Domain

text:
    Hugo Paoli, Appellant, v. Thomas Mason, Appellee.
    Gen. No. 43,201.
    Heard in the third division of this court for the first district at the October term, 1944.
    Opinion filed February 14, 1945.
    Released for publication March 5, 1945.
    Peter D. Giachini and Alphonse Cerza, both of Chicago, for appellant.
    Charles C. Wooster, of Chicago, and Thomas Mason, pro se, for appellee; Howard B. Bryant, of Chicago, of counsel.
   Mr. Presiding Justice Burke

delivered the opinion of the court.

Hugo Paoli, a tavern keeper, filed a complaint in the superior court of Cook county to recover damages suffered as a result of the claimed revocation of a liquor license by Thomas Mason, president and ex officio liquor control commissioner of the Village of North-field, and his refusal to reissue the license. Issue was joined. A trial before the court without a jury resulted in a finding and judgment for the defendant and plaintiff appeals.

Since June 1, 1934 plaintiff operated a tavern on Happ Road in the Village of Northfield, hereinafter called the Northfield Tavern, and since October 1938 he also operated a tavern outside the village, hereinafter called the Skokie Tavern. To the rear of the barroom in the Northfield Tavern is. a hall once used as a dance hall, which has been converted into a warehouse, and which the plaintiff rents to a beer distributor named Gus Erickson. Between 11:30 and 12: 00 p. m. on Saturday, June- 28, 1941 defendant was in the Northfield Tavern. With him was Dr. R. B. Mundél, who lives in Evanston and who has an office in Winnetka. They were standing at one end of the bar. At the other end there were several young men. Present also were Jim Paoli, the manager of the tavern and a nephew of plaintiff, Walter Shleif, the bartender, Arthur George Bess, who worked for Erickson in the beer warehouse, Ed Petersen, who also worked for Erickson as a driver of a beer truck, Fred Petersen, who was then 19 years of age and a brother of Ed Petersen, and Joe Jingles, who was then 17 years of age. Ed Petersen purchased a glass of beer for Fred and this glass of beer was served to Fred. Defendant claims he saw the bartender sell a bottle of beer to Fred Petersen, a minor. The testimony of defendant as to this incident is corroborated by Dr. Mundel. Ed, Fred and the bartender testified that the bottle of beer was bought by Ed, who paid for it and then handed it to his brother, the minor, to take home. Fred Petersen and Joe Jingles walked out of the tavern toward an automobile which Fred had parked. Fred was carrying the bottle containing the quart of beer. Defendant followed the boys out of the tavern and asked Fred whether he purchased the beer in the tavern. Defendant stated that Fred replied: ‘ ‘ Sure I did.” Defendant directed Fred to wait and removed the ignition key in Fred’s car so that Fred could not move his car. Defendant then returned to the tavern and by telephone called chief of police Ed Clapper. When Clapper arrived, he and defendant talked with the boys. Arthur George Bess was standing about 10 feet away and heard the conversation. Then Clapper went into the tavern and asked Shleif, the bartender, to come outside. Clapper testified that Shleif admitted selling a quart of beer to Fred Petersen. Chief of police Clapper took the two boys to his office in the village hall. There Fred printed a statement that he . purchased a quart of Bheingold beer; that he paid 30^ for the beer to the bartender; that the bartender gave him the beer and that the bartender did not ask him if he was a minor. Fred Petersen testified that he made the statement because he was threatened with being locked up for the night. At the time of the alleged sale of the bottle of beer and the serving of the glass of beer to Fred, plaintiff was not present in the tavern. No steps were taken to prosecute any of the parties concerned for alleged violation of any State law or of any village ordinance. The next day, Sunday, June 29, 1941, defendant returned to the tavern at about 11: 00 a. m. He asked the bartender and manager to sign a statement admitting the sale of the beer to Fred. They refused. Defendant took the license. In so doing he intended to revoke the license and the parties so treated it. On Monday, June 30, 1941, defendant advised the Illinois Liquor Control Commission by telephone that he had revoked the license. ' That day, or the next day, plaintiff and his attorney came to defendant’s law office in Chicago. Defendant told plaintiff and his attorney that when he revoked the Northfield Tavern license he did not appreciate that the effect of his act was to revoke the Skokie tavern license as well. He testified that he expressed concern of plaintiff losing his means of earning a livelihood and that he would be glad to help, in working the matter out so that plaintiff would not lose his Skokie tavern license. A day or two later plaintiff and his attorney returned to defendant’s Chicago law office. It was then that plaintiff signed the following letter, addressed to defendant and dated July 1, 1941:

“On June 28, 1941, you charged me with violation of the Dram Shop Act, and revoked my Local Liquor License for my tavern on Happ Road, in the Village of Northfield. You later told me that you didn’t want to jeopardize my state license for my tavern on Skokie Boulevard. You, therefore, reinstated my license in the Village of Northfield and permitted the same to expire in good standing upon my agreement to surrender all right to renew my Local Liquor License in the Village and my agreement not to operate a tavern in the Village without a new license.
“This is to advise you that in consideration of the above and foregoing, I hereby and-herenow renounce all right to a renewal of my Local Liquor License to run my tavern in the Village of Northfield. This letter is not to be construed as a denial of my right to apply in the future for a new license in case one should become available. I will not operate in the Village without having first procured a new license.”

Plaintiff’s attorney testified that the letter of surrender was ready when he and his client arrived at defendant’s office and that he had nothing to do with drafting it. Plaintiff testified that he signed the letter on advice of his attorney; that his attorney told him it was the thing to do; that' the letter was prepared while he and his attorney were in defendant’s office; that defendant’s secretary was called in; that defendant and plaintiff’s attorney dictated the letter; that plaintiff’s attorney dictated part and defendant part; and that the secretary then typed it and that he signed it. After the letter was signed, defendant notified the State Liquor Control Commission that plaintiff’s license had been restored, thus saving plaintiff’s Skokie tavern license. Thereafter plaintiff demanded a license from defendant. The village ordinance provided for the issuance of only five retail liquor tavern licenses. Nevertheless, there were six taverns in operation. Plaintiff’s license was not the last one issued. There was evidence that at that time licenses were issued semi-annually and that the new license period was to commence July 1, 1941. In the Fall of 1941 plaintiff filed an application for a license. On December 31, 1941 plaintiff notified defendant and the Hlinois Liquor Control Commission that an appeal was being taken from defendant’s alleged refusal to reissue plaintiff’s license. Hearings were had from time to time on the appeal and on June 9, 1942 the commission entered a finding that defendant had no just cause or reason to refuse to issue the license. From this order defendant appealed to the circuit court. On October 29, 1942 the circuit court sustained the order of the Illinois Liquor Control Commission. At the time of the events recounted, the village ordinance regulating the sale of alcoholic liquor provided for an annual fee for a license to sell at retail of $500. An amendment adopted November 12, 1942, after the order affirming the action of the Illinois Liquor Control Commission, provided that the license period for retail dealers be the calendar year from January 1 to the succeeding December 31, and that the annual license fees be paid in full in advance. Following the order of the circuit court, plaintiff was granted a license and he reopened the tavern on November 10, 1942. He was required to pay $500 for a license to cover the period until December 31, 1942. On July 3, 1943 plaintiff filed the instant complaint. As a result of a pretrial conference, it was ordered that the testimony of the witnesses as shown in the transcript of the proceedings before the State Liquor Control Commission be considered by the court “the same as if the witnesses had testified herein.” In addition to reading the transcript, the trial judge heard the testimony of plaintiff as to his alleged damages. He claims that he lost $4,000 as a result of “the improper acts” of defendant in revoking his license and in refusing to reinstate it. Plaintiff’s theory of the case is that defendant had no jurisdiction to revoke his liquor license; that defendant wilfully and maliciously revoked the license; that defendant, later, under duress, caused plaintiff to surrender his license; that still later he wilfully and maliciously refused to reissue the license for the ensuing license period; that defendant committed a trespass when he took the frame and license certificate from plaintiff’s premises; that plaintiff is entitled to damages therefor; that in the alternative defendant in revoking and reissuing a liquor license acts as ministerial officer, and that he is liable to the plaintiff even though he did not act wilfully and maliciously; and that he should be allowed damages for the period during which his place of business was closed. Defendant’s theory of the case is that he had the power to revoke plaintiff’s liquor license and to refuse to reissue it; that he exercised that power in good faith and for cause and was performing a governmental function; that the surrender of the license was voluntary on the part of plaintiff and upon advice of his counsel; that as a matter of law applied to the facts in this case, the gist of plaintiff’s cause of action is defendant’s failure to reissue the license; that the antecedent revocation for cause and voluntary surrender have no connection therewith and are barred by the statute of limitations; that he was justified in not issuing a license because of the provisions of the ordinance and statute; and that plaintiff has not established a cause of action against him.

The General Assembly under its police powers had authority to provide for the issuance and revocation of liquor licenses. This power was exercised by the passage of the Liquor Control Act in 1934. By this Act the power was delegated to the Local Control Commissioner (or Commission if there was more than one officer). Sec. 1 of art. 1 of the Liquor Control Act (par. 94, ch. 43, Ill. Rev. Stat. 1943 [Jones Ill. Stats. Ann. 68.001]) provides that the “act shall be liberally construed to the end that the health, safety and welfare of the People of the State of Illinois shall be protected, and temperance in the consumption of alcoholic liquors shall be fostered and promoted by sound and careful control and regulation of the manufacture, sale and distribution of alcoholic liquors.” Sec. 1 of art. IV (par. 110 [68.017]) gives the village president and board of trustees the right to determine the number, kind and classification of liquor licenses and to make regulations and restrictions upon the issuance of such licenses. Sec. 2 of art. IV (par. 111 [68.018]) makes the president the local control. commissioner and provides that he shall be charged with the administration in his jurisdiction “of the appropriate provisions of the Act and of such ordinances and resolutions relating to alcoholic liquor as may be enacted.” Sec. 3 of art. IV" (par. 112 [68.019]) gives the' local liquor control commission the power “to grant and revoke for cause all local licenses issued to persons for premises within his jurisdiction.” Sec. 1 of art. VI (par. 119 [68.026]) provides that a license shall be purely a personal privilege and shall not constitute property. This section further provides that:

“Any licensee may renew his license at the expiration thereof provided he is then qualified to receive a license and the premises for which such renewal license is sought are suitable for such purpose; and provided further that the renewal privilege herein provided for shall not be construed as a vested right which shall in any case prevent the city council or village president and board of trustees or county board, as the case may be, from decreasing the number of licenses to be issued within its jurisdiction.”

Prior to the amendment approved July 17, 1941, the section above quoted provided that the renewal privilege should not be construed as a vested right which should in any case prevent the local commissioner from decreasing the number of licenses to be issued within his jurisdiction. This amendment substituted the words “president and board of trustees” for the words “local commissioner.” Sec. 5 of art. VII (par. 149 [68.056]) provides that the local commission may. revoke any license issued by it if it determines that the licensee violated any of the provisions of this Act, or any valid ordinance or resolution enacted by the particular city council, president, and board of trustees or county board, or any applicable rule or regulation established by the local commission which is not inconsistent with the law. Sec. 8 of art. VII (par. 153 [68.060]) gives any person interested the right to appeal to the state commission from any order or action of the commission refusing to grant a license or revoking a license. Sec. 2 of art. VI (par. 120 [68.027]) provides the qualifications one must possess in order to sécure a liquor license. Sec. 3 of art. X (par. 185 [68.093]) provides that every act or omission of whatsoever nature constituting a violation of any of the provisions of the Act, by any officer, director, manager or other agent or employee of any licensee, if said act is committed or omission is made with the authorization, knowledge or approval of the licensee, shall be deemed and held to be the act of such employer or licensee, and said employer or licensee shall be punishable in the same manner as if the act or omission had been done or omitted by him personally. Sec. 4 of art. X (par. 186 [68.094]) provides for the revocation of a license when the licensee has been convicted of any violation of the Act. Sec. 5 of art. X (par. 187 [68.095]) provides for the revocation of a liquor license whenever any “officer, director, manager or other employee in a position of authority of any licensee under this Act shall be convicted of any violation of this Act while engaged in the course of his employment. . . .”

Plaintiff maintains that a reading of the statute shows that if the licensee violates the law, the license can be revoked, but that if the statute is violated by an agent, the latter must be convicted of the violation before the license may be revoked. Plaintiff states that there is nothing in the record showing that if the agent did violate the law, it was with his (plaintiff’s) authority, knowledge or approval, and that hence the license could not be revoked under sec. 185 of the Act. He points out that if there was a violation, it was committed by the bartender and that he was not prosecuted, and suggests that before defendant could revoke the license a conviction of the bartender was necessary. Plaintiff also asserts that defendant did not show that the liquor purported to be sold to the minor was intoxicating; that the duty of defendant was fixed and certain; that he had no discretion, power or right to revoke the license until the bartender had been charged with selling liquor to a minor and convicted; that the ascertainment that the bartender had been convicted of selling liquor to a minor would empower defendant to revoke the license; that in ascertaining the fact of conviction there would be no need for the exercise of discretion or judgment; that consequently the act is not judicial, but purely ministerial; that a licensee has the right to receive a renewal of the license at an ensuing license period, providing there has been no change in the facts or circumstances; that the act of renewing a license is a ministerial function not involving the exercise of discretion; that the conduct of defendant was wilful, wanton and malicious; that he had no jurisdiction to revoke the license; that he had no right to revoke it before there was a conviction of the bartender; that there was one license too many; that he was out “to get rid of” one of the licenses ; that he improperly took down the frame and license certificate; that there was “pressure” used to get the minor to sign the statement; that the bartender was never charged with an offense; that defendant did not endeavor to ascertain whether the liquid in the bottle was in fact intoxicating; and that in the hearing before the State Liquor Control Commission defendant exhibited considerable feeling. Plaintiff urges that in the alternative, “whether the conduct of the defendant was or was not wilful, wanton or malicious is immaterial because, it is respectfully submitted, the defendant at the time he revoked plaintiff’s license and at the time he refused a renewal of said license, was acting as a ministerial officer.” Plaintiff also states that the weight of the evidence supports the conclusion that liquor was not sold to a minor on June 28, 1941, and argues that he must recover from the defendant, or he will be without a remedy.

Sec. 112 of the Act provides that the Liquor Control Commission shall have the power, function and duty to revoke licenses for cause. Sec. 149 provides that the local commission may revoke any license if it determines that the licensee has violated any provisions of the Act. Sec. 150 provides that the revocation of the local license shall automatically revoke the State license, without which a licensee is not permitted to operate in the State. It was the duty of defendant as the local liquor control commissioner to revoke licenses “for cause.” That there are two methods of procedure open to the local commissioner is clearly recognized by sec. 3 of art. VII (par. 147 [68.054]), which reads:

“If a licensee shall be convicted of the violation of any of the provisions of this Act, or his license shall be revoked and no appeal is taken from said order of revocation or any appeal taken therefrom is decided adversely to the licensee, said bond (if one is required) shall thereupon be forfeited. . . .”

The Liquor Control Act is a comprehensive Act covering the control, regulation, manufacture, sale and distribution of alcoholic liquors. There is no provision of the Act which makes a conviction in a criminal proceeding for violation of the Act or the local ordinances a necessary condition to a revocation of a license. Plaintiff concedes that if a licensee violates the law, the license may be revoked, but argues that in the case at bar the licensee has not violated the law, and urges that the grant of power to revoke a license “for cause” can only mean the ground stated elsewhere in the Act. Plaintiff also states that the gist of his action is the unlawful revocation of his license, and that the revocation being illegal, all the things that followed were a nullity. Plaintiff states that if the licensee violates the law, the license can be revoked, but that if the statute is violated by an agent, before a license can be revoked, the agent must be convicted of the violation. Wé cannot agree with this construction. A prosecution under the criminal statutes would be by the state’s attorney in the name of the people and not by the Local Liquor Control Commission. The agent (bartender) would be entitled to a" trial by jury and he would have to be proved guilty beyond a reasonable doubt before he could be convicted. A prosecution by the village, through its attorney, for violation of an ordinance would have to be proved by a preponderance of the evidence and the bartender would be entitled to a jury trial. We do not believe the act requires a conviction of the agent (where the alleged violation is by the agent) before the license of the principal may be revoked. We are convinced from a reading of the record that defendant acted honestly and used his best judgment in revoking the license on Sunday, June 29, 1941. A few days later he withdrew the revocation. At that time plaintiff signed'a document surrendering his license. We -find that plaintiff was not subjected' to any duress at the time he surrendered his license. Defendant treated plaintiff with all due consideration and was kind to him in what he did. Both plaintiff and defendant recognized that there was grave danger that plaintiff would lose the liquor license for the Skokie tavern. At the time of the hearing before the State Liquor Control Commission the parties all recognized that it was unlawful to sell intoxicating liquor to minors. There was no issue raised as to whether the beer was in fact intoxicating. The parties at the hearing before the State commission assumed that it was intoxicating. The question as to whether the beer was intoxicating was not raised by anyone in the hearing on the appeal in the circuit court, nor at the trial of the instant case. Defendant in revoking the license, in withdrawing the revocation of the license and then accepting the surrender thereof was acting in good faith and in accordanee with what he believed to be his duty in the premises. When plaintiff sought to have the license reissued to him, defendant acted properly. At that time the ordinance permitted the issuance of only five retail licenses and five retail licenses were outstanding. Defendant would be violating the village ordinance if he granted a license to plaintiff after the revocation or surrender of the license theretofore issued. We are of the opinion that a local liquor control commissioner is not liable to the licensee for his official acts in revoking or refusing to reissue a license. In People v. Courtney, 380 Ill. 171, the Supreme Court said (p. 179):

“The general rule of liability applying to judges applies alike to all officers exercising quasi judicial powers, and they are exempt from liability for error or mistake of judgment in the exercise of their duty in the absence of corrupt or malicious motives.”

We are satisfied that the doctrine announced in the Courtney case is applicable to the acts of defendant in his official capacity as liquor control commissioner as shown by the record of the instant case.

Under the circumstances shown by the record, defendant did not commit a trespass in taking the framed license certificate. Defendant had the right to revoke the license. The method he adopted was to enter the premises and take down the license. Two or three days later defendant surrendered his license. It is unnecessary to consider the point urged by defendant that plaintiff’s cause of action is barred by the statute of limitations. The record does not show neglect on the part of defendant, or any wilful, wanton or malicious act. It shows that defendant was endeavoring to conscientiously perform his duties, and that far from showing malice toward plaintiff, defendant did everything within his power to enable plaintiff to retain the license to operate his other tavern. If any criticism is to be leveled at defendant it is that he considered that plaintiff was not a proper person to operate a tavern in Northfield, but that he was a proper person to operate a tavern outside of that village. Because of these views the judgment of the superior court of Cook county is affirmed.

Judgment affirmed.

Kiley and Lupe, JJ., concur.


author: Mr. Justice Kiley

text:
    Wm. Wrigley, Jr. Company, Appellant, v. Standard Roofing Company, Appellee.
    Gen. No. 42,915.

      Heard in the third division of this court for the first district at the December term, 1943.
    Opinion filed February 14, 1945.
    Released for publication March 5, 1945.
    Chester D. Kern and James A. Dooley, both of Chicago, for appellant.
    Albert M. Howard and Walter A. Christopher, both of Chicago, for appellee.
   Mr. Justice Kiley

delivered the opinion of the court.

This is an action under section 29 of the Workmen’s Compensation Act, Chapter 48, Par. 166, Ill. Rev. Stats. [Jones Ill. Stats. Ann. 143.44] to recover an amount not to exceed $4,071.70, the amount of compensation, etc. paid or to be paid by plaintiff to the widow of its employee by reason of the latter’s injuries which caused his death. Judgment was for defendant upon a verdict of not guilty and plaintiff has appealed.

Albert Zarling was a checker and watchman of incoming and outgoing automobiles and pedestrians, on a driveway paralleling the north side of Building “E” of plaintiff’s South Ashland Avenue plant in Chicago. On September 13, 1940, defendant was engaged in roofing work on the roof of Building “E.” During the course of the work a ladder being used by its employees fell from the roof, struck Zarling and fractured his skull. He died from the injury the following day. Both plaintiff and defendant were operating under the provisions of the Workmen’s Compensation Act at the time, and after a finding by the Industrial Commission that decedent’s injuries arose out of and in the course of his employment, Zarling’s widow was awarded, and paid part of, the sums sought to be recovered herein.

The complaint is in two counts, the first of which charges that the defendant had exclusive ownership, possession and control of the ladder, and that as a result of its negligence the ladder fell and injured Zarling while he and plaintiff were in the exercise of due care. The second count charged that defendant negligently placed the ladder without proper fastening, carelessly maintained it in its position and otherwise mishandled it, so as to cause it to fall and injure Zarling while he and plaintiff were in the exercise of due care. The defendant denied the allegations of due care and negligence, offered no testimony and rested its case after motions for a directed verdict were denied.

'When the injury occurred defendant’s employees Kompanowski and- Riley were working on the roof of Building “E.” This building is six stories high and upon its roof are several elevator penthouses. One of these, located at the north edge of the main roof, has as its north wall a portion of the north wall of the main building extended. This penthouse measures 12 feet north and south and its roof is 12 or 13 feet above the main roof. Defendant’s two employees were using an extension ladder measuring 10 feet unextended and 20 extended. The end of each ladder leg contained a metal prong 1 inch long and 1 inch in diameter. The upper ends of the ladder sides bore metal hooks. The ladder unextended was placed against the west wall of the north penthouse about 8 or 10 feet south of the firewall at the north edge of the main roof, and the ladder legs were placed on 6 inch by 6 inch wooden blocks about 3 or 4 feet west of the wall. The ladder was not hooked to the penthouse roof. There is testimony, both that the prongs were resting on and stuck into the blocks. Kompanowski and Riley worked on the penthouse roof from about 10:30 a. m. until noon and resumed work after lunch. They had used the ladder several times in this period and it “felt secure.” About 1:30 p. m. Kompanowski, weighing 212 pounds, was reaching down for tar paper, and a sudden gust of wind turned him about. As he was turned from the south he saw the ladder falling over the north firewall. At that time he was about 20 feet away from the previous position of the ladder and Riley about 8 feet away. Most of these facts were presented by testimony of Kompanowski as a witness for plaintiff. Riley did not testify.

Plaintiff contends that the verdict should be set aside because defendant did not introduce any evidence to explain the accident to overcome the presumption of negligence by virtue of res ipsa loquitur under Count I, nor to overcome the prima facie case of specific negligence under Count II. It also contends that the judgment should be reversed because of faulty instructions.

Defendant says that if plaintiff proved specific negligence there can be no application of the doctrine of res ipsa loquitur; and that defendant ivas not required to offer any proof to overcome a prima facie case made by the plaintiff, if there was sufficient evidence unfavorable to plaintiff arising from plaintiff’s case. It contends that the jury was properly instructed.

Plaintiff admits here that the proof shows that a gust of wind blew the ladder from the roof. It says, however, that the defendant should have anticipated the wind and secured the ladder against it. There were no weather reports pertaining to the force of the wind offered in evidence. There is Kampanowski’s testimony that he had never experienced such a wind before in his work. The defendant argues that the question of its negligence was for the jury and that the jury’s verdict is justified by the evidence. Both parties appear to be in accord with the rule that the presumption of negligence arising by virtue of the doctrine of res ipsa loquitur does not apply where there is evidence explaining the accident or contrary to the presumption, or where there is room for a different inference.

Where a plaintiff shows due care, the happening of an accident and the injury as a proximate result, the control by defendant of the instrument of the injury, and it appears that the accident is one that except for negligence of defendant would not ordinarily have happened, there is a presumption of defendant’s negligence. If no evidence is produced to explain the accident or to refute the presumption or to make room for an inference contrary to defendant’s negligence, then plaintiff should recover. Where there is evidence of specific negligence, however, there can be no application of the doctrine of res ipsa loquitur. Bollenbach v. Bloomenthal, 341 Ill. 539. Where plaintiff charges general negligence, relying upon the doctrine of res ipsa loquitur,.and also charges specific negligence and offers evidence attempting to establish a prima facie case of specific negligence, either one of two results may follow: (1) The prima facie case of specific negligence be established and the case go to the jury on that count, and in this event the doctrine of res ipsa loquitur is not applicable and the general negligence count should not go to the jury; (2) the attempt to establish the prima facie case of specific negligence fail but, nevertheless, the evidence establish the elements supporting the presumption of negligence by virtue of the doctrine of res ipsa loquitur, and the case go to the jury on the general negligence count, and in this event the specific negligence count should be withheld. from the jury. Since plaintiff insists that' there is evidence tending to prove the specific negligence and, moreover, since it admits that a gust of wind blew the ladder from the roof, we conclude on this point that the doctrine of res ipsa loquitur is inapplicable.

Defendant admits that the question of its negligence was for the jury and it does not argue that there is any question of decedent’s due care or that plaintiff’s due care was not for the jury. ■

The next point to consider, therefore, is plaintiff’s contention that because defendant offered no evidence, the jury had no alternative but to render a verdict for plaintiff. In determining whether plaintiff’s charges of the specific negligence should go to the jury, a question of law is involved to be decided upon consideration of plaintiff’s testimony as true with legal inferences drawn most strongly in its favor. Having decided that the case was proper for the jury to decide, it then became the province of the jury to determine the questions of fact arising out of all the evidence favorable and unfavorable and guided by the instructions of the court to arrive at a verdict. Defendant was not obliged to present testimony, but could rely as it did here upon factors unfavorable to plaintiff or favorable to itself developed from witnesses for plaintiff. Any issues of fact presented by the evidence were determinable by the jury.

Plaintiff contends that the judgment should be reversed because of the giving of erroneous instructions. It says instructions 8, 9 and 10, involving contributory negligence, should not have been given as there is no evidence to which they could apply. Plaintiff offered an instruction covering due care. It has,accordingly, waived its right to complain upon the general subject. Cleveland, C., C. & St. L. Ry. v. Ricker, 116 Ill. App. 428; Mattoon City Ry. Co. v. Graham, 138 Ill. App. 70; People v. McGown, 57 N. E. (2d) 857 (Ill.). Instruction No. 8 states that “ ‘Proximately’ means . . . closely connected with the injury in the order of events' and so connected with the injury that but for contributory negligence the injury would not have happened.” This definition is not clear to the average man. Instruction No. 10 states that if plaintiff by “use of its faculties in looking for danger could have avoided the accident, it cannot recover.” The term “faculties” as used in instructions referring to natural persons has no place in an instruction referring to an artificial person. Instruction No. 11 states that the jury should find defendant not guilty if it ■ should find that plaintiff would have avoided- the injury by exercising due care “for its own safety.” There is no question of plaintiff’s safety, but of the safety of its employee whom plaintiff was bound to protect by exercise of due care through its other employees and in the operation of its business. There is no basis in the evidence for Instructions No. 10 and No. 11. Each party referred us to a case in support of its argument on Instruction No. 10. Neither is applicable. The considerations bearing on due care of a passenger in an automobile can hardly be applied to a corporation in relation to its employee. There is no evidence which suggests that the decedent was guilty of contributory negligence and the evidence could hardly be stretched to suggest that the plaintiff through its employees did not use due care to protect the decedent. There was evidence that certain of plaintiff’s employees were on the roof before the accident. Their business was not connected with the roofer’s work and there was nothing there to attract their attention to the position of the ladder. They might have warned Zarling that the men were working, although the inference is that he knew it, since the roofers had been employed for weeks at plaintiff’s plant and on the day in question were getting hot tar from a fellow employee standing at the street level. We believe there was no warrant for giving Instructions Nos. 10 and 11. Complaint is made of Instruction No. 12 which informs the jury that “the mere happening of the accident . . . raises no presumption of negligence on the part of defendant.” Such an instruction was condemned in Mississippi Lime & Material Co. v. Smith, 282 Ill. 361, relied upon by plaintiff, because there was nothing in the record there to suggest an accident. Here, there was testimony that a gust of wind blew the ladder from the roof. The same view applies to Instruction No. 13. The ruling on a similar instruction in Minnis v. Friend, 360 Ill. 328, does not apply here. Were the doctrine of res ipsa loquitur applicable in this case, a different question would arise as to these instructions. The court properly refused to give plaintiff’s instruction which covered the application of the doctrine res ipsa loquitur.

Thirteen of the sixteen instructions given were at the request of defendant. Seven of these concluded with the words, “find the defendant not guilty,” or similar phrases. This practice was condemned in Gulich v. Ewing, 318 Ill. App. 506, where the court said, “It is undoubtedly misleading to the jury and prejudicial to plaintiff’s cause” and that it was particularly prejudicial where the defendant offered no evidence, because the jury might infer the court doubted whether a prima facie case was madp.

For the errors committed in instructing the jury, it is our opinion that the judgment should be and it hereby is reversed and the cause remanded.

Reversed and remanded.

Burke, P. J., and Lupe, J., concur.


author: Mr. Justice Lupe

text:
    Steven E. Chapin, Appellant, v. Peter Tampoorlos, Appellee.
    Gen. No. 42,802.

      Heard in the third division of this court for the first district at the October term, 1943.
    Opinion filed February 14, 1945.
    Released for publication March 5, 1945.
    Richard Hill, Jr. and John O. Wagner, both of Chicago, for appellant.
    Charles V. Falkenberg and John P. Klein, both of Chicago, for appellee.
   Mr. Justice Lupe

delivered the opinion of the court.

The plaintiff, Steven E. Chapin, had borrowed the sum of $5,000 from the defendant, Peter Tampoorlos, and had assigned to defendant an indebtedness in the sum of $3,400, secured by a chattel mortgage upon fixtures and equipment in the premises at 5846 West Madison street, Chicago. This $3,400 indebtedness was credited by the defendant against the $5,000 owed by the plaintiff, leaving a balance due the defendant of $1,600.

In June 1940, the defendant demanded payment of the $1,600 and negotiations followed between the parties pertaining to the purchase by defendant of a conditional sales contract owned by plaintiff. The conditional sales contract, dated December 21, 1939, had been entered into by plaintiff as seller, and Lillian Douvris and Coula A. Harrison as buyers, and provided for the sale of certain equipment and fixtures at 5846 West Madison street, Chicago, upon which there was a balance due of $3,600 payable in monthly instalments.

On September 18, 1940, plaintiff assigned the conditional sales contract to the defendant. This assignment by plaintiff was in writing upon the reverse side of the contract, and is as follows:

“Cicero, Spt. 18 1940.
“For Value Received, I hereby assign, transfer and set over all my right, title and interest in and to the within Conditional Sale Agreement and the goods and chattels described therein unto William Tampoorlos and Peter Tampoorlos, to the extent of $1,600.00. As and when said $1,600 is paid, the residue of the moneys due under this Agreement shall be paid' to Steven E. Chapin and the agreement surrendered to him.”

At the time the defendant executed a receipt dated September 18, 1940, which is as.follows:

“Received from Steven E. Chapin Conditional Sales Agreement dated December 21, 1939, between Steven E. Chapin seller and Lillian Douvris and Coula Harrison buyers which is deposited with the First National Bank of Cicero for collection — when I receive the sum of $1,600.00 from the collections, said agreement and all of the residue of the moneys due thereunder shall be paid to Steven E. Chapin.”

The buyers under the conditional sales contract failed to make payments on the balance of $3,600 or the interest due thereunder, and the defendant and William Tampoorlos on November 7, 1941, took possession of the chattels described in the conditional sales contract, and on November 10, 1941, sold to defendant Peter Tampoorlos the chattels described in the conditional sales contract (pursuant to power contained in the conditional sales agreement) for the sum of $1,800.

Prior and subsequent to the sale of November 10, 1941, the plaintiff testified, he made tenders to the defendant of the sum of $1,600 due from plaintiff to defendant, but such tenders were refused. The plaintiff thereupon instituted the present suit for a conversion by the defendant of the conditional sales contract on which there was due a balance of $3,600, together with exemplary damages. The trial court held that the written assignment signed by the plaintiff above set forth constituted the whole contract between the parties; that said assignment was not in legal effect a pledge; that thereby plaintiff parted with all interest in the conditional sales contract; and thereupon excluded all of the evidence of the plaintiff and instructed the jury to find the issues for the defendant. Judgment was entered upon this verdict and this appeal by the plaintiff followed.

The question presented is whether the agreement as evidenced by the two writings above set forth was a sale or a pledge as security for a loan. A sale is the transfer of property for a price in money. The transfer of the property in a thing sold from a seller to a buyer for a price is the essence of the transaction. And the transfer in order to constitute a sale must be a transfer of the general or absolute property with no further rights in the property reserved unto the seller.

A loan 'of money has been defined as an advancement of money upon a contract or stipulation, express or implied, to repay it at some future day. [Brittin v. Freeman, 17 N. J. Law (2 Har.) 191, 213.] A pledge is the lien created by the delivery of personal property by the owner to another upon an express or implied agreement that it shall be retained as a security for an existing or future debt. (Corbett v. Underwood, 83 Ill. 324.)

The question of whether the transfer of a chose in action is to be deemed a sale, or a pledge as security for a loan, is one of intention to be determined by a consideration of the various provisions of the contract or transfer and the circumstances under which the transfer is made. (Mercantile Trust Co. v. Kastor, 273 Ill. 332; Dorothy v. Commonwealth Commercial Co., 278 Ill. 629.)

In construing the agreement between the parties the two instruments executed on September 18, 1940 must be construed together. In the case of Daly v. Spiller, 222 Ill. 421, in passing on a similar situation, the court said (p. 424): “The initial question is, by the original transaction did Green pledge the policy of life insurance to Daly to secure his note, or was the transaction a sale of the policy to Daly, with a contract for its repurchase by Green.

“It appears that Green applied to Daly for a loan; that in connection with the matter three instruments were executed, which must be construed together in’ determining what the’original contract was.”

The evidence shows that on September 18, 1940, the plaintiff was indebted to the defendant in the sum of $1,600 and that no note or written evidence of such indebtedness had been executed. With such admitted indebtedness in being, we find the two instruments, one executed by the plaintiff and one by the defendant. The instrument signed by the plaintiff is in form an assignment of the conditional sales agreement and the goods and chattels described in the conditional sales contract, but the assignment is limited by the words “to the extent of $1,600,” and by the further provision that “As and when s.aid $1,600 is paid the residue of the amount due under this agreement shall be paid to Steven E. Chapin and the agreement surrendered to him.” The receipt of the defendant for said conditional sales agreement provides that “when I receive the sum of $1,600 from the collection, said agreement and all the residue of the monies due thereunder shall be paid to Steven E. Chapin.”

There is no mention in either of these instruments that the $1,600 debt of plaintiff is released and cancelled; upon the receipt by defendant of the said sum of $1,600 plaintiff was entitled to a return of the conditional sales contract; and all monies above $1,600 collected by the defendant were to be paid to the plaintiff by the defendant. Under these circumstances we cannot hold that these instruments assigned to the defendant an absolute title to the conditional sales contract and the personal property therein described with no further rights reserved unto the plaintiff. Upon the execution of the instruments, the plaintiff still had the undoubted right to repossess himself of said conditional sales contract and with it the rights in the chattels described therein upon the payment of the $1,600 indebtedness. As the amount of the conditional sales contract amounted to the sum of $3,600, the defendant only had a special property interest in said conditional sales contract and the chattels therein described to the extent of $1,600, and the general property in the same remained in the plaintiff, subject to the lien of the debt due to defendants.

In the case of Rohrle v. Stidger, 50 Cal. 207, Rohrle assigned to Stidger a note and mortgage signed by Strahle and Hughes, and Rohrle and Stidger entered into a contract in writing which set forth that Stidger had advanced to Rohrle $11,014.32 in payment of which Rohrle had sold him the note and mortgage, and that Stidger was willing that Rohrle should receive the benefit of any surplus the note might yield over and above the amount sufficient to reimburse Stidger, and that Stidger should be protected against any attachments or garnishments. The court in construing this agreement said (p. 210): “The contract recited that Stidger was willing that Rohrle should receive the benefit of any surplus which the notes and mortgage might yield over and above the amount sufficient to reimburse Stidger for monies advanced for Rohrle. This amounts to a stipulation that the surplus • should go to the benefit of Eohrle. By another clause of the contract the right of the creditors of Eohrle to attach the surplus in the hands of Stidger is recognized in term . ... We think that the transfer by Eohrle to Stidger must be held to have been intended by the parties not as absolute in its character, but by way of security merely.”

In the case, of Isaak v. Journey, 52 Idaho 392, the plaintiff delivered to the defendant a promissory note for $800, given to him by another, and executed and delivered to the defendant an assignment of a chattel mortgage securing the note, receiving from the defendant the sum of $200. The court held that although the assignment was absolute in form that it might be shown that the transaction was a pledge and not a sale. With reference to the fact that no note was executed by the plaintiff and no rate of interest on the loan was agreed upon, the court held that such fact was not conclusive as to a sale but that such facts were entirely consistent with a pledge. The court reviewed the evidence and said (pp. 398, 399): “We are satisfied there was sufficient clear and convincing competent evidence, notwithstanding the conflict therein, from which the jury could logically conclude, as it evidently did, that the assignment, though absolute in form, was in fact given by respondent and intended, solely as collateral security for the repayment of his loan, and that the transaction did not constitute a sale of the note and mortgage. ’ ’

It is shown by the evidence herein that the defendant was receiving a conditional sales contract on which there was a balance due of $3,600, at least $2,000 in excess óf the indebtedness of plaintiff to the defendant; that plaintiff was to receive the excess received on said contract over and above the amount of the said $1,600; that upon payment of said $1,600 plaintiff was entitled to the return of the conditional sales agreement; that the plaintiff tendered the defendant the $1,600 due to him and that defendant refused to accept the tender and refused to return the pledged contract; that at the time of the tender by plaintiff which was before the sale of the property by the defendant, defendant said he had a buyer for the place who would pay more than he and the plaintiff had coming and that plaintiff would get his money; that the defendant requested the plaintiff not to bid at the sale and promised that if plaintiff did not bid at the sale plaintiff would get his money; that after the sale he told the plaintiff that he had told his lawyer to give plaintiff his money; that the defendant purchased the property at his own sale and immediately resold same to a party whose name he refused to give, and that this purchaser immediately went into possession of same and conducted the restaurant as a going business; and that defendant admits that plaintiff came to his place and every time he came he always demanded the pledged property. When we consider the above facts together with other facts disclosed by the evidence, we are convinced that there was sufficient evidence introduced by the plaintiff to show that the instruments signed by the parties when construed together, evidence a pledge of the conditional sales contract and the chattels referred to therein. There was sufficient evidence introduced by which the jury might find that the assignment of the conditional sales contract was intended as collateral security for the repayment of the $1,600 due from plaintiff, and that the transaction did not constitute an absolute sale of the conditional sales contract and the chattels described therein. In holding as a matter of law that the transaction amounted to an absolute assignment of the conditional sales contract and property, and that plaintiff had no further interest therein, the trial court erred. It follows that the trial court further erred in instructing the jury to find the issues for the defendant, and in striking from the record the evidence of plaintiff which tended to prove that the assignment was given as collateral security for the debt of plaintiff.

If the plaintiff made a tender to the defendant of the money due to the defendant and said tender was made prior to the date of the sale held by the defendant, then the sale held by the defendant was a conversion by defendant of the property of plaintiff. That question of fact should have been submitted to the jury for its verdict thereon.

The question of whether the acts of the defendant were unlawful and malicious was a question of fact for the jury. Where plaintiff claims exemplary damages as in this case, it is for the jury to determine from all the facts and circumstances whether malice is shown, and whether the case requires more' than compensatory damages. (Hemsteger v. Nelson, 181 Ill. App. 377; Davenport v. Ledger, 80 Ill. 574.) If the jury should find that the taking by the defendant was malicious, the jury may give exemplary damages. (Davenport v. Ledger, 80 Ill. 574.) In cases where exemplary damages are recoverable, the pecuniary resources and financial condition of the defendant are elements for the jury to consider in estimating and assessing damages. (Hinton v. Muhlman, 201 Ill. App. 177; Schmitt v. Kurrus, 234 Ill. 578.) If the evidence offered by the plaintiff on a retrial of this cause establishes a malicious conversion by the defendant, then the jury may from a consideration of all the facts and circumstances adduced upon such retrial allow exemplary damages to the plaintiff.

The judgment of the circuit court will be reversed and the cause remanded to that court for a new trial.

Reversed and remanded.

Burke, P. J., and Kiley, J., concur.


text:
    Smithereen Company, Appellant, v. Clyde E. Renfroe, Trading as Renfroe Exterminating Service, Appellee.
    Gen. No. 43,015.

      Heard in the third division of this court for the first district at the April term, 1944.
    Opinion filed February 14, 1945.
    Released for publication March 5, 1945.
    Eckhart, Klein, McSwain & Campbell, of Chicago, for appellant; John Neal Campbell and M. A. Palumbo, both of Chicago, of counsel.
    Peter F. McNamee and Kellam Foster., both of Chicago, for appellee.
   Mr. Justice Lupe

delivered the opinion of the court.

This was an action in equity by The Smithereen Co., a corporation, against Clyde E. Renfroe, doing business as Renfroe Exterminating Service, a former employee of the plaintiff. Plaintiff by its action sought to restrain the defendant from engaging in business in competition with the plaintiff for a period of five years from the date of the termination of defendant’s employment with plaintiff and for other relief. The request for this relief was predicated upon the terms of a written agreement between the plaintiff and the defendant dated November 1, 1935. This agreement between the parties is as follows:

Agreement made this 1st day of November, A. D. 1935 between the Smithereen Company, a corporation, of Chicago, Illinois, party of the first part, and C. E. Renfroe, party of the second part,

WITNESSETH,

In consideration of my employment by the Smithereen Company, I covenant and agree as follows:

1. That on the termination for any cause whatsoever of my employment with the Smithereen Company that I will not engage in the same line, or similar line of business as that now carried on by the Smithereen Company, or engage to work for any individual firm or corporation engaged in such line or a similar line of business or engaged in the manufacture, sale or distribution of any chemical specialties, fumigants, insecticides, or equipment for the application of same or any product or products similar to or having the same purpose as the products made and sold by the Smithereen Company, in the City of Chicago, State of Illinois, for a period of five (5) years from the time the employment by the Smithereen Company shall cease.

2. I further agree that I will not, during the term of my employment by the Smithereen Company, or at any other time thereafter, furnish to any individual, firm or corporation, other than the Smithereen Company, any list or lists of customers or information as to the products of the Smithereen Company, or in any way pertaining to the business of the Smithereen Company.

3. I further agree that any inventions and formulas which shall result from my employment, and pertaining to the business of the Smithereen Company, shall at the request of said company, be protected by patents which patents shall become the sole property of the said Smithereen Company.

Given under my hand and seal the day and year first above written.

C. E. Benfroe (Seal)

Witnesseth:

The Smithereen Co.,

By H. E. Jennings, V. P.

The plaintiff has been engaged in the pest extermination business and for a number of years has" had four offices in the City of Chicago." Its main office was located in the Loop, and its three other offices were branch offices on the south, north and west sides of Chicago, respectively. The business of plaintiff covers the whole City of Chicago and its customers include hotels, hospitals, apartment buildings, homes, etc. The defendant became an employee of the plaintiff on August 16, 1932, and worked as a serviceman, servicing apartments in exterminating work, out of plaintiff’s north side office, and continued with service-work until October 30, 1932, when he began to work as a salesman for plaintiff. In July 1933, defendant became manager of plaintiff’s north side office and continued in that capacity until March 15, 1941, when he left plaintiff’s employ.

On April 1, 1941, defendant entered the exterminating business at 1829 Irving Park Blvd. on the north side of Chicago, in competition with plaintiff and sent out an announcement in which he stated that he was now engaged in the exterminating business and would endeavor to render the same high quality of service to his customers and friends to which they had become accustomed during the nine years that defendant was employed by the plaintiff; that he would render prompt and efficient service for.any exterminating job, large or small, servicing Chicago and suburbs; that he desired to thank all his customers and friends for their generous support given him in the past; and that their confidence and support had made possible the starting of his own business, and that he would do everything within his power to uphold that confidence. The defendant continued in this competing business, the service rendered by the defendant being similar in all respects to that of plaintiff. The services of both plaintiff and defendant were being conducted and operated in the City of Chicago, at the time this suit was instituted.

Plaintiff brought this action to secure a permanent injunction restraining the defendant for a period of five years from April 1, 1941, from engaging either by himself or as an employee of others in the City of Chicago in the business of exterminating insects, etc. ; also from engaging in the manufacture, sale or distribution of any chemical specialties, fumigants, insecticides or equipment for the application of same; and from furnishing to any person, other than plaintiff, any list or lists of customers or information as to the products of the plaintiff, or any information pertaining to the business of plaintiff; and that an accounting be taken for the loss and damage sustained by the plaintiff by reason of the wrongful acts of the-defendant, and the profits which resulted to the defendant through the conduct of said competing business.

The defendant filed his answer herein contending that the said agreement was in restraint of trade, was contrary to the public policy of this State, and was therefore void; and that he did not receive or have any list or lists of names of plaintiff’s customers and did not receive or have any information .of any trade secrets, trade methods, formulae, or any other confidential information in regard to plaintiff’s business, other than that within his knowledge prior to his employment with the plaintiff.

The cause was referred to a master in chancery who made a report to the court, finding that the contract between the plaintiff and defendant was reasonable and valid; that the defendant was actually made aware of the business secrets and methods of the plaintiff, was given by plaintiff a list of plaintiff’s customers, and information with reference to the contracts of plaintiff with its customers; that he engaged in a business in competition with plaintiff; and that he induced customers of the plaintiff to cancel their contracts with the plaintiff and induced employees of the plaintiff to cease their connections with plaintiff and become .associated with or employed by the defendant.

The cause came on for hearing on exceptions to the master’s report and the chancellor sustained the exceptions to said report and dismissed the complaint for want of equity. This appeal followed.

The development of the law with respect to restrictive covenants in partial restraint of trade is well set up in the case of Tarr v. Stearman, 264 Ill. 110, where the court said (p. 118):

“It has always been the policy of the law to promote the freedom of engaging in and carrying on all kinds of trades and professions which are beneficial to the public. (2 Pomeroy’s Eq. Jur., 3d ed., see. 934.) Formerly by the common law all contracts in restraint of trade were void. (24 Am. & Eng. Ency. of Law, 2d ed., 842.)

The law on this subject has undergone changes and the authorities at the present time are not in harmony. (2 High on Injunctions, 4th ed., sec. 1167; Allen Manf. Co. v. Murphy, 20 Ann. Cas. [Ont. L.] 657, and note.) It is sometimes said that equity is loath to enforce a contract in restraint of trade, even though it be good law, if the terms are harsh or complex. (Bispham’s Principles of Equity, 7th ed., sec. 227.) The authorities now generally agree that contracts in partial restraint of trade are valid if reasonable as to time, place, terms, etc., and manifest an intention to protect the party relying upon the covenant in the reasonable restraint of unjust discrimination against him. (Southern Fire Brick Co. v. Sand Co., 223 Ill. 616.) ”

An examination of the authorities shows that restrictive covenants involving partial restraint of trade usually arise in connection with contracts for the sale of a .business, a professional practice, or large stock-holdings in a corporation, and in cases wherein contracts of employment are involved.

With respect to restrictive covenants made in connection with the sale of a business, a professional practice, or large stockholdings in a corporation, the authorities are in accord that a restrictive covenant in partial restraint of trade is valid, so long as the restrictive covenant is reasonable as to time, place, etc., and can be said to have been entered into to fairly protect the covenantee in the property rights which he has acquired from the covenantor.

Such restrictive covenants which are too broad or too general are held invalid. This is clearly demonstrated by the holding in the following cases: Lanzit v. J. W. Sefton Mfg. Co., 184 Ill. 326; Union Strawboard Co. v. Bonfield, 193 Ill. 420; Parish v. Schwartz, 344 Ill. 563. But restrictive covenants which are reasonable as to time and place are generally held valid. This is clearly demonstrated in the following cases: Hursen v. Gavin, 162 Ill. 377; Judes Chain Store Corp. v. Stone, 316 Ill. App. 45; Pelts v. Eichele, 62 Mo. 171; Washburn v. Bosch, 68 Wis. 436.

Contracts for the sale of goodwill of a profession to another of the same profession with a restrictive covenant by the vendor not to engage in such profession within a limited territory wherein the vendee is continuing the practice of his profession in a limited territory are generally held valid. This is shown in the cases of Linn v. Sigsbee, 67 Ill. 75; Ryan v. Hamilton, 205 Ill. 191; Storer v. Brock, 351 Ill. 643.

An exception to this rule appears in cases where the public interests are involved. Even though a contract be fair and reasonable between,the parties, yet, if the effect of it is so injurious to the public interest that the public policy requires that it shall not be enforced, it will be held void. An example of this exception is shown in the case of Tarr v. Stearman, 264 Ill. 110, where Tarr was in the business of renting and occupying dental offices and employing licensed dentists to run them. Tarr employed Stearman to run an office under a written contract of employment which provided that upon the termination of Stearman’s services Stearman would never, in the City of Springfield or within 25 miles thereof, be engaged, directly or indirectly, in behalf of himself or with others, in the practice of dentistry. The court, in holding said restrictive covenant invalid, said that the interest of the public was paramount; that the convenience of a given community or locality would be promoted if every such locality had its proper accommodations and service from every art, trade and profession; that a contract in restraint of trade or profession in any given locality could not be upheld unless it should be shown that the place of such individual so restrained would be supplied by some other persons of the same trade or profession; that there was no such showing in that case and that, therefore, the agreement was unreasonable and void.

The cases involving contracts between employer and employee which contain restrictive covenants prohibiting the employee from engaging in a business competing with that of his employer subsequent to his employment are numerous. We find in this class of cases that the employer’s right to injunctive relief depends upon a showing by the employer that, by reason of the character of the employment or the services rendered by the employee, the employee has had close and intimate contacts with the employer’s customers or has obtained such knowledge of the employer’s business that to use such knowledge and acquaintanceship in a competing business would result in irreparable injury to the employer.

This rule is clearly laid down in the cases of Jules Chain Store Corp. v. Stone, 316 Ill. App. 45; Whittenberg v. Williams, 110 Colo. 418; Samuel Stores, Inc. v. Abrams, 94 Conn. 248; Grand Union Tea Co. v. Walker, 208 Ind. 245; Eigelbach v. Boone Loan & Investment Co., 216 Ky. 69.

In the case of Mag v. Young, 125 Conn. 1, a restrictive covenant by an employee against entering into the employ of any client of the employer for a period of two years subsequent to the employment was upheld as reasonable, the court saying, at pages 6 and 7:

“A bargain by an employee not to compete with his employer during the term of the employment or thereafter ‘within such territory and .during such time as may be reasonably necessary for the protection of the employer . . . , without imposing undue hardship on the employee’ does not impose unreasonable restraint of trade unless effecting, or forming part of a plan to effect, a monopoly. Restatement, Contracts, Yol. 2, sec. 516 (f).
“Agreements by which an employee undertakes not to enter a competing business or employment on leaving his employer’s service are reasonably necessary for the protection of the employer’s business. Under such agreements parties obtain employment on certain terms which prevent them, on leaving that employment, from making use of knowledge which they have acquired during that employment to the detriment of their employer. Middleton v. Brown, 47 L. J. Ch. 411, 412; 13 C. J. 485. When the character of the business and the nature of the employment are such that the employer requires protection for his established business against competitive activities by one who has become familiar with it through employment therein, restrictions are valid when they appear to be reasonably necessary for the fair protection of the employer’s business or rights, and do not unreasonably restrict the rights of the employee, due regard being had to the subject-matter of the contract and the circumstances and conditions under which it is to be performed. Especially if the employment involves the imparting of trade secrets, methods or systems and contacts and associations with clients or customers it is appropriate to restrain the use, when the service is ended, of the knowledge and acquaintance, so acquired, to injure or appropriate the business which the party was employed to maintain and enlarge. 6 R. C. L., pp. 805, 806. The employer is entitled to contract for and to enforce protection against unfair competition made dangerous by the use of weapons placed by him in his employee’s hands during his service and which may be turned against him, such as the knowledge of trade secrets or other confidential information or an acquaintance with his employer’s customers and their requirements, resulting from the nature of the employee’s services, which is regarded as a species of good will in which the employer has a proprietary interest.”

Contracts have frequently been upheld whereby salesmen, agents,' canvassers and other employees who come in personal contact with their employer’s customers, agree not to engage in a competitive business in a limited time and area after leaving their employer’s service. Thomas W. Briggs Co. v. Mason, 217 Ky. 269; 13 C. J. 485.

Courts will uphold and enforce such restrictions, if not otherwise contrary to public policy, where they find that the facts alleged disclose a restriction on the employee reasonably necessary for the fair protection of the employer’s business or rights and not unreasonably restricting the rights of the employee, due regard being had to the interest of the public and the circumstances and conditions under which the contract is to be performed. (Samuel Stores, Inc. v. Abrams, 94 Conn. 248, 108 Atl. 541, 9 A. L. R. 1450.)

Covenants of this character, though recognized to be in partial restraint of trade, are sustained where properly limited as to time and territory and are not otherwise against public policy, the test generally being whether the restraint is necessary for the protection of the business or goodwill thereof, the injury to the employee which must not be greater than is reasonably necessary to secure the business of the employer, or the goodwill thereof, regard being had to the injury which may result to the public by restraining the breach of the covenant, in the loss of service and skill of the employee, and the danger of his becoming a charge upon the public being taken into due consideration. (Thomas W. Briggs Co. v. Mason, 217 Ky. 269.)

A covenant inserted in a contract for personal service restricting trade or competition, or freedom of employment, is valid and may be enforced in equity, provided it is necessary for the protection of the employer, is not injurious to public interest, and is reasonably limited in time and space. What is reasonable depends upon the facts. (Economy Grocery Stores Gory. v. McMenamy, 290 Mass. 549; Sherman v. Pfefferkorn, 241 Mass. 468; Becker College of Business Administration and Secretarial Science v. Gross, 281 Mass. 355.) And to the same effect see Holland Furnace Co. v. Connelley, 48 Fed. Supp. 543; Harry Livingston, Inc. v. Stern, 69 Ohio App. 105, 43 N. E. (2d) 302.

From the above it can be seen that it is generally held that contracts of employment whereby managers, branch managers and other employees, who come into personal contact with their employer’s customers, agree not to enter into competition with the business of the former employer are valid and enforceable, where such-restrictive covenants are for a limited time, within a limited area and such limitations are reasonably necessary for the protection of the employer’s business. These contracts containing restrictive covenants which impose restrictions greater than are reasonably necessary for the protection of the former employer’s business, or unreasonably restrictive upon the rights of the employee or in contravention of the public interest are held invalid.

We find the decision of every case involving restrictive covenants similar to those set up in the contract between the plaintiff and the defendant in this case in great measure is determined and governed by the facts of each particular case. In the present case the defendant was branch manager of the north side branch of plaintiff. In that capacity he gained acquaintances and sold customers by using the goodwill of the plaintiff. The business of the plaintiff is to a large extent built upon the confidence of its customers, through long experience. The manner and operation of plaintiff’s business was peculiar in that it was necessary to use certain chemicals in combination and mixture, and the evidence justifies the conclusion that at least one of the formulae used by plaintiff was a secret process, and the defendant became thoroughly familiar with such methods and processes used by the plaintiff.

The defendant’s position as branch manager of the north side branch of the plaintiff and the fact that he had previously worked out of other offices of the plaintiff, together with his having acquired knowledge of the methods and processes used by the plaintiff, gave the defendant confidential information that should not have been divulged to others or used for his own benefit.

The evidence herein justifies the finding of the master that the defendant induced a number of customers of the plaintiff to cancel their contracts with the plaintiff and to enter into a contract with the defendant; and that he also induced employees of the plaintiff to sever their relations with the plaintiff and to enter the employ of the defendant. The evidence further justifies the conclusion that the defendant solicited business from customers of the plaintiff whose names he had learned, while its branch manager, setting forth in his announcement that he would endeavor to render the same high quality service to which his customers and friends had been accustomed during the nine years that he was employed by plaintiff; that he would render prompt and efficient service for any exterminating job, large or small, servicing Chicago and suburbs; and that he thanked all his customers and friends for the generous support giveii him in ¿he past and that their confidence and support had made it possible for him to start his own business.

From this evidence it is clear that the defendant has violated his contractual obligation not to engage in competition with the business of plaintiff; that the defendant is availing himself of information with respect to the names of customers and the methods, formulae, etc., used by the plaintiff in its business; and that the defendant is using this personal, if not altogether confidential information acquired during his employment with the plaintiff for his own personal benefit. This defendant should not be shielded by a court of equity from the deliberate violation of his contractual' obligation, when it is apparent that such conduct involves the appropriation and misuse of information entrusted to him in the course of employment to which the contract relates. It is apparent to us that the plaintiff has and will continue to suffer irreparable injury from the kind of competition which defendant is giving to the plaintiff.

For the reasons indicated, we are of the opinion that the restrictive covenants of the contract entered into by the plaintiff and defendant do not impose a restraint beyond that reasonably required for the protection of the plaintiff’s business, that such provisions are not unreasonably restrictive upon the rights of the defendant and do not contravene public policy and are therefore valid and enforceable.

With reference to the contention of the defendant that there was no mutuality of contract between the parties, because the written agreement does not bind plaintiff to employ defendant in any capacity for any specific period of time, the written agreement shows that same was made in consideration of the employment of defendant by the plaintiff; the evidence shows that the defendant signed said contract after making several changes in same; that the defendant continued in the employ of the plaintiff for a period of approximately five years after the execution of said agreement ; that the plaintiff retained the defendant in its employ at a salary acceptable to the defendant and complied with the terms of the employment in all details ; and that the defendant voluntarily left the employ of plaintiff.

If it be regarded that the contract in the instant case is indefinite as to the terms of the employment, still it is an established principle of law that an agreement too indefinite and vague for enforcement at its inception may be made definite by performance. (Roessler v. Burwell, 119 Conn. 289 and cases there cited; Walker Goal & Ice Co. v. Westerman, 263 Mass. 235.)

In the case of Economy Grocery Stores Corp. v. McMenamy, 290 Mass. 549, there was no agreement on the part of the plaintiff to employ the defendant for any fixed or definite period, and nothing was said as to how long the employee should work for the employer. The court in passing on the agreement said (p. 552):

“The contract was not void for lack of consideration. When accepted and acted on by the plaintiff, it implied according to its reasonable construction a promise on the part of the plaintiff to employ, the defendant. It was not wanting in mutuality. The amount of compensation to be paid was fixed by separate agreement. ’ ’

So in the present case the compensation and term of employment of the defendant by the plaintiff was fixed by a separate agreement and same was fully performed by the plaintiff and accepted' by the defendant. The contract here in issue was not void for want of mutuality.

The plaintiff was entitled to the relief recommended by the master, and the chancellor erred in sustaining the defendant’s exceptions to the master’s report, and in dismissing the complaint for want of equity. The decree is reversed and the cause is remanded to the circuit court with directions to overrule the exceptions of the defendant to the master’s report and to enter a decree in accordance with the recommendations of the master’s report.

Reversed and remanded with directions.

Burke, P. J., and Kiley, J., concur.