author: . Mr. Justice Scott

text:
    The People ex rel. George L. Thatcher v. The Village of Hyde Park.

      Filed at Ottawa January 25, 1886.

    !• Mandamus—to compel the doing of an unlawful act—as, in the malt-¿”0 of a special assessment after the proper time has elapsed. A writ of mandamus will not be awarded for the performance of an act which for any reason has become unlawful to be performed. So the writ will not be allowed to compel village authorities to make special assessments to pay judg™en*s condemnation when more than five years have elapsed after dismissal of the proceedings. r &
    2. Same—demand of performance—whether necessary. The writ will not be granted to compel the corporate authorities of a village or other body to do an act it has never been asked to do. The petition should show a demand for performance of the act, and a refusal.
    3. Same—as to discretionary matters—as, the malting of a special assessment, or incurring municipal indebtedness. The propriety of making special assessments by village authorities is a matter, exclusively within their legislative discretion, and so is the propriety of their contracting corporate indebtedness; and such discretion will not be interfered with by the courts.
    ' The courts will never compel them to contract an indebtedness for any purpose.
    4. Opening streets—necessity for an ordinance. No street can be opened except under an enabling ordinance, and without such ordinance there can be no condemnation of property for public use by a city or village.
    5. Same—opening or widening streets by sections. A street may be widened or opened by sections. Therefore, the repeal of an ordinance for the laying out and opening of a street, except as to lands taken possession of for public purposes, is not a vacation of the entire street, as proposed, but only the part not in fact opened.
    6. Same—taxation for local improvements—discretion as to the mode. The mode of making local improvements, as, opening streets, is a matter of discretion with the municipal authorities, not subject to judicial control.. They may be paid for in any mode provided by law, either out of the general fund, by special taxation, or by special assessments; and the adoption of either mode excludes the idea of payment in any other.-
    7.. So where the ordinance for the opening of a street provides foj' the payment of the cost of the improvement wholly by special assessments, and the proceeding is vacated or abandoned as to a certain portion of the street, the courts will not compel the payment of the judgments for the lands actually taken and used for a street in-any other mode than by special assessments. In such case a mandamus will be denied which seeks to compel payment out of the general fund raised by taxation on all the property of the municipality.
    8. Issues oe pact—in the Supreme Court—how tried. Where issues of fact are made in this court on a petition for mandamus, they will be referred to the proper trial court,-to he found and certified back.
    This was a petition: for a mandamus, brought in this court by the relator, against the village authorities of Hyde Park, to compel the payment of certain judgments rendered in a proceeding to condemn land for a public street. Certain issues of fact were ordered to be tried before a jury in the Superior Court of Cook county.
    Mr. Consider H. Willett, for the relator:
    Where a city, through its neglect, fails to collect the special assessment to pay condemnation money, it must pay the same out of its general fund. Maher v. Chicago, 38 Ill. 266; People v. Cairo, 50 id. 154; Chicago v. People, 56 id. 357.
    - The doctrine of abandonment may be exercised by a municipality, with reference to the mode in which it sought to make payment for 'property taken by condemnation.

      Mandamus upon a judgment is barred, like debt upon a judgment. Peoria Co. v. Gordon, 82 Ill. 435.
    The statute governing this case is almost identical with section 5 of the West Park act, "which was "construed by this court in People v. Atchison, 95 Ill. 452, to limit the making of a special assessment to five years.
    The fact that" Hyde Park," by its own acts, could not levy or could not collect a special assessment to pay for the land taken, to open the street, establishes its general liability, which can only be discharged by general taxation. Wheeler v. Chicago, 24 Ill. 105; Clayhurgh v. Chicago, 25 id. 535; Bradford v. Chicago, 25 id. 411.

      Mandamus is the adequate and appropriate remedy to compel municipal corporations to pay judgments obtained against them. City of Olney v. Harvey, 50 Ill. 453; Town of Lyons v. Cooleclge, 89 id. 529.
    The assignee of such judgment may maintain -mandamus. Higgins v. Chicago, 18 Ill. 276; Chicago v. Sansum, 87 id. 182.
    As against municipal corporations, a mandamus takes the place of an execution.'
    After possession is taken, the rights of the parties is irrevocably fixed, so that the party condemning must make payment. Ferris v. Ward, 4 G-ilm. 499; Sangamon Co. v. Broion, 13 111. 207; Dunlap v. Mt. Sterling, 14 id. 251; Curry v. Mt. Sterling, 15 id. 320; Peoria Co. v. Harvey, 18 id. 364; Taylor v. Marcy, 25 id. 518; Commissioners v. Durham, 43 id. 86; Barbián v. Chicago, 80 id. 482; Hyde Park v. Dunham, 85 id. 569; Commissioners v. Dunlevy, 91 id. 49; Chicago v. Palmer, 93 id. 125; Beveridge v. Commissioners, 100 id. 75.
    It is no concern to the parties whose lands are taken, as to the mode the village may adopt to pay them their compensation. Byron v. Blount, 97 Illl. 62.

      Mandamus should command the borrowing of money to pay this judgment. Rev. Stat. chap. 24, art. 7, sec. 3.
    Mr. George Willard, for the respondent:
    The original ordinance provided that the cost of the improvement should be paid by special assessment.
    A street may be widened or opened by sections. Bigelow v. Chicago, 90 Ill. 49.
    It is competent for the village still to collect the condemnation money by special assessment, and that is the only mode by which the same may be collected.
   . Mr. Justice Scott

delivered the opinion of the Court:

This is an original suit in this court, and is a petition for mandamus, brought in the name of the People, on the relation of George L. Thatcher, against the village of Hyde Park, to compel the village to - pay for land alleged to have been taken for a street or highway, under certain condemnation proceedings had in 1873. It appears from the statement of the petition, that on December 7, 1872, the village of Hyde Park in due form passed an ordinance to take certain lands lying between Forty-first and Forty-seventh streets, within the limits of the village, for a public street, to be called Forrestville avenue. In and by that ordinance it was provided the entire cost of the proposed improvement should be paid for wholly by special assessments. Afterwards such proceedings were had, on petition of the village, the compensation to owners whose lands were taken was duly ascertained according to law, and, among others, damages were awarded to William T. McKeever and George Matthews for lands respectively owned by them, and. judgments in condemnation rendered in favor of each of them for the sums ascertained to be just compensation for the lands taken for public purposes. The lands belonging to these owners are situated between Forty-first and Forty-second streets. It is not controverted that afterwards McKeever and'Matthews assigned their respective judgments to relator, and to confirm such assignments quitclaim deeds were executed vesting the title to such lands in the relator, so that he has now the same right in such condemnation judgments as the original owners of the land had. It also appears that after the rendering of the judgment of condemnation, the village, with the consent of the owners, took possession of the lands of McKeever and Matthews, for a public street. This fact in the case is no longer disputed, since it was found as a fact by the court, to which certain questions of fact were sent to be ascertained by trial. On December 5, 1873, the village caused a supplemental petition to be filed, for an order of court directing a special assessment to be made in accordance with the provisions of the ordinance. It seems commissioners were appointed who made a special assessment, which it is alleged was made March 20, 1875. An order was entered that objections be filed to such assessment rule by a day fixed, and after the expiration of the time so fixed, an order was entered in the case that a default be entered against all parties who had not filed objections to the assessments made. In respect to this assessment the allegation of the petition is, that no further order or proceedings have ever been taken concerning the same, under such supplemental petition, by the village. Later on,—perhaps on the 2d day of July, 1877,—the village passed an ordinance for “abandoning proceedings for the opening of Forrestville avenue. ” The second section of that ordinance in terms repeals the original ordinance providing for the opening of Forrestville avenue from Forty-first street to Forty-seventh street, and “provided that if, through any acts of the village, parts of said avenue have been taken possession of, so that the same has become a public highway, said ordinance shall be construed as not vacating such parts of said avenue.” In July, after the passage of this ordinance, the village moved the court to dismiss all proceedings theretofore taken in the cause, and to set aside and discharge all the condemnation judgments entered against the corporation. On ascertaining the village had in fact taken possession of the lands of McKeever and Matthews lying between Forty-first and Forty-second streets, with the consent of the owners, the court refused to allow the petition to be dismissed, so far as these lands or judgments were involved, but did permit the village to dismiss all proceedings concerning the residue oof the lands proposed- by the original ordinance to be taken, lying between Forty-second and Forty-seventh streets.

The corporate authorities and the finance committee of the village are made defendants, and the prayer of the petition is, first, that a writ of mandamus issue, requiring the president and trustees of the village to levy a general tax to pay the judgments now held by relator, upon all the property situated in the village; second, for an order against the president and finance committee of the village, under the sanction of the board of trustees, that they borrow a sufficient sum of money to pay relator’s judgments, with interest and costs, as is provided in section 3, article 7, chapter 24, of the Revised Statutes of 1874; and third, if this court shall be of opinion the relief above demanded is not proper, but that the village has power to levy a special assessment, or to proceéd with the collection of the special' assessments mentioned in the petition as having been commenced, then and in that case relator asks that the village authorities be compelled to proceed according to law to make a special assessment, amito pay relator’s judgments.

It will, perhaps, be most convenient to consider the matters concerning which relief is demanded, in the inverse order-stated. As respects the alternative relief asked in case the principal relief prayed for should be thought not proper, it seems to be two-fold: First, that the village be required to make a special assessment in accordance with law; or second, that the village be required to proceed with the collection of the assessment commenced as stated in the petition. It seems to be conceded by counsel for relator, it would be illegal to make any new assessment unless done within five years from the date of the dismissal of the proceedings as to all lands except those lying between Forty-first and Forty-second streets. That was in July, 1878, and more than five years have elapsed since that date before the petition in this case was filed. Whatever equity there might have been for action in this particular ease, it is clear a writ of mandamus will never issue for the performance of an act which, for any reason, has become unlawful to be performed.

As respects the second branch of the alternative relief demanded, or perhaps suggested, if it shall be conceded, as it is thought it may be done, the supplemental petition filed December 5,1873, praying the court to enter an order directing a special assessment to be made in accordance with law, shall he regarded as still pending, so far as the property between Forty-first and Forty-second streets is concerned, although dismissed as to all property between Forty-second and Forty-seventh streets, it would seem to be a sufficient answer to the position taken it is not alleged the corporate authorities of the village ever refused to proceed with that special assessment. Without determining whether.the village has now any rightful authority to proceed on the petition, so filed at a former time, it can hardly be said a writ of man-damns will issue to compel a party to do a thing it was never asked to do. The petition contains no allegation any demand was ever 'made upon the village to go forward with the proceedings instituted in 1873, for the collection of the special assessment. It is alleged, demand was made upon the village for the payment of relator’s judgments, and that it had failed and refused .to make payments of the same. That is the only demand made upon the village.

The question of borrowing money for any purpose specified in section 3, article 7, chapter 24, of the Revised Statutes of 1874, is wholly within the discretion of the village officers designated for that purpose. The rule is well settled and uniformly observed, the courts will never compel a municipal corporation to contract an indebtedness for any purpose. When that may be done must be left to the discretion of the municipal officers, so they act within powers, conferred by law. This proposition seems so plain it need not be elaborated.

But these are minor ’ questions in the case, to which no great importance is attached. The principal point made is, whether this court will compel the village to pay relator’s condemnation judgments, or, what is the same thing, compel the village to levy a general tax on the property within the village for that specific purpose. The argument in support of the relief demanded seems to proceed on the theory the action of the village under the repealing ordinance of July 2, 1877, wiped out all proceedings previously had in relation to opening Forrestville avenue, except the condemnation judgments as to the land between Forty-first and Forty-second streets, and as the village had taken possession of the lands, these judgments by that act became absolute, and hence should be paid out of common funds, as any other judgments. The fallacy of the position taken consists, in part, at least, in the assumption that all proceedings concerning the opening of the avenue between Forty-first and Forty-second streets, other than the mere judgments, were disannulled by the action taken under the repealing ordinance. Such is not the ease. It was expressly provided that as to any land of which possession had been taken for public purposes, the “ordinance shall be construed as not vacating such parts of said avenue.” The correct reading of the ordinance in this respect is, that as to all parts of the avenue where possession had been taken, the repealing ordinance should be inoperative. This is its clear and manifest meaning. It was so construed by the court, and it was for that reason permission to dismiss the proceedings was refused as to all parts of the avenue where possession had been taken. This court decided in Bigelow v. City of Chicago, 90 Ill. 49, that a street .might be widened by sections, and no reason is perceived why a street in a village or city may not be opened by sections. The effect of w'hat was done was to permit the opening of all that part of the avenue where possession had been taken under the original ordinance to open Forrestville avenue. ■If this were not so, there could be no condemnation judgments in favor of relator or his assignors. No street can be opened except under enabling ordinances, and without such ordinance there • can be no condemnation of property for public uses by a city or village. There is, and can be, no doubt'the mode of making payments for local ■ improvement is within the discretion of the municipal authorities, and that that discretion is not subject to the control of the courts.

Such improvements may be paid for in any mode provided by law, either out of the general fund, by special taxation, or special assessments, and the adoption of either mode excludes the idea of payment in any other way. In this case the village board declared, by ordinance, in advance, the entire cost of the proposed improvements should be paid for wholly by special assessment. As has been seen, the original ordinance, so far as the lands between Forty-first and Forty-second streets are concerned, is still in force, and the mode of payment for the proposed improvement is as fixed by that ordinance,—that is, by special assessment. It is not true, in law, as counsel suggest, the special assessment proceeding, so far as the two blocks are concerned, was abandoned and rescinded by any action of the village board. What new ordinance or amendments, if any, may have been necessary,, in view of the abandonment of a part of the proposed improvement, is not now before this court for decision. It is decisive of the present case the village board determined the improvements undertaken should be paid for by special assessment, and while that ordinance remains in force, as it does, it excludes any other mode of payment,—hence the prayer of relator that his condemnation judgments may be paid out of the general fund raised by taxation on all the .property subject to taxation by the village, must be .denied.

The writ of mandamus must be refused.

Writ refused.

Mr. Justice Sheldon thinks the writ should be awarded to compel the village to proceed with the collection of the special assessment for payment of petitioner’s judgment, in accordance with the alternative prayer of the petition.

Magruder,,J. : I concur with Mr. Justice Sheldon.


source: Caselaw Access Project

author: Mr. Justice Craig

license: Public Domain

text:
    Miner N. Knowlton v. Anna Hanbury et al.

      Filed at Ottawa January 25, 1886.

    1. Chancery—evidence in support of bill, after a confession of plea in bar. Where a plea of a former adjudication is tiled in bar to a cross-bill, and the complainant in the cross-bill fails -to reply thereto, and thereby admits the truth of the facts set up in the plea, the only question on the cause being set for hearing on the plea is its sufficiency, and evidence offered in support of the cross-bill is properly excluded as irrelevant.
    2. Former adjudication—effect of dismissal of bill in chancery—as a bar to a second suit. A former decree in a suit in equity between the same parties and for the same subject matter, is a good defence to a second bill in equity, even though it be a decree merely dismissing the bill, if the dismissal is not expressed to be without prejudice.
    3. A, having the legal title to property in Chicago, which really belonged to B, his sister, a resident of Massachusetts, exchanged the same with C for twenty-seven vacant lots in a village in Massachusetts, and deeds were made accordingly. The Chicago property was conveyed, subject to a deed of trust thereon, for $1800, A agreeing to pay the interest on the incumbrance up to a certain date. B filed a bill in the United States Circuit Court for the Northern District of Illinois, against C, making A and others, parties, seeking to set aside the exchange of property on the ground of fraudulent representations in respect 'to the character, location and value of the village lots, which, on the hearing, was dismissed. C afterward filed his bill in the State court, to enjoin a sale of the Chicago property, making the trustee, and A and B, parties. A filed a cross-bill seeking a rescission of the contract of exchange on the same grounds of fraud, to which C pleaded the former decree in the Federal court in bar: Held, that the decree of dismissal in the Federal court was a bar to the relief sought in the cross-bill.
    Appeal from the Superior Court of Cook county; the Hon. George Gardner, Judge, presiding.
    Mr. B. M. Munn, for the appellant:
    The plea of estoppel or res judicata applies only when the same question was once judicially determined and is raised again between the same parties; and it is essential that all questions of fact and of law should be the same; also, that the subject matter and grounds of action, and the same parties suing or defending in the same character, shall be the same. Hermann.on Estoppel, sec. 22, p. 21; Bigelow onEstoppel, (2d ed.) 6.

      Res judicata applies only where the cause has gone to a complete termination, and nothing more is to be done to settle the rights of the parties, or the extent of those rights. Bigelow on Estoppel, (3d ed.) 32, 33; Packet Co. v. Sickles, 5 Wall. 583; Russell v. Place, 94 U. S. 608; Foster v. Busteed, 100 Mass. 412; 45 Texas, 104; 45 Mo. 294; Davis v. Kennedy, 105 Ill. 306; Shinkle v. Letcher, 47 id. 216.
    Messrs. M. A. Rorke & Son, for the appellees:
    So long as a plea in bar of a record in another court of equity had been pleaded to the entire cross-bill of Knowlton, and remained undisposed of, the court below could not receive or hear evidence in support of the cross-bill. This is an elementary rule of equity pleading. 1 Daniell’s Ch. Pr. chap. 15, sec. 4.
    Again, as Knowlton did not reply to said plea, its truth was admitted, and Knowlton could only take the judgment of the court below as to its sufficiency in point of form or of substance. Story’s Eq. PI. chap. 13, sec. 697.
    The rights of the parties could have been, and were, adjudicated in the former suit, and if Knowlton was dissatisfied with the decree there rendered, his remedy was by appeal. Hicks v. Chapin, 67 Ill. 375.
    It is a well settled rule, that a decree dismissing a bill upon its merits is conclusive until reversed, and is good in bar to a new bill for the same matter. 2 Story’s Eq. Jur. sec. 1523; 1 Gray, 412.
    And where there is no want of jurisdiction, an erroneous judgment is just as binding on the parties to it, until reversed, as a judgment entirely free from error, and may be pleaded as a bar to a second suit. Graceland Cemetery Co. v. People, 92 Ill. 619.
    Again, where the same matters involved in a suit in equity were involved in a jirior. suit, though in the United States Circuit Court" and the two suits were between- the same parties, the decision in the prior suit will be conclusive on the trial of the second suit brought in the State court. Ruegger v. Railroad Co. 103 Ill. 449.
    The doctrine of res judicata is again stated in Cooper v. Corbin, 105 Ill. 224, and Tilley v. Bridges, id. 336.
    In a suit between substantially the same parties, such a plea of former adjudication was held good as an estoppel by judgment. -Hanna v. Reed, 102 Ill. 596; Thompson v. Roberts, 24 How. 233; Hamilton v. Quimby, 46 Ill. 90.
   Mr. Justice Craig

delivered the opinion of the Court:

• Miner N. Knowlton, who claimed to own title to Nos. 18, 20 and 22 Winthrop Place, Chicago, entered into a contract with Anna Hanbury to exchange the property for twenty-seven vacant lots at Clarendon Hills, Massachusetts. The legal title to the Chicago property appeared to have been in the name of Knowlton, but his sister, Emily Hoyt, was the real owner. The Chicago property was transferred subject to an incumbrance on No. 22 of $1800, and the lots at Clarendon Hills were transferred subject to an incumbrance of $1000. Some time after the exchange of the property, Lyman Baird, who was named in the deed of trust on No. 22 as trustee, advertised the property for sale, and Anna Hanbury, on the 8th day of February, 1883, filed her bill to enjoin the sale. Lyman Baird, Knowlton, and Emily Hoyt were all made parties to the bill. The complainant alleged in her bill, that in the trade Knowlton had agreed to pay all interest on the note named in the deed of trust which had accrued prior to October 1, 1882, and that after that date the rate of interest was agreed to be changed from nine to eight per cent. The balance of the incumbrance complainant offered to pay. The defendants answered, denying every material allegation of ■ the bill, and defendant, Knowlton, filed a cross-bill, in which he set up, in substance, that complainant in the ’bill, Anna Hanbury, by fraud and false representations respecting the character, value, location and price paid for the Clarendon Hills property, procured the sum of $500 in cash and the execution of said contract and deeds, thereby acquiring title. deeds and the possession of property renting for $1320 per annum, and worth at least $12,00Q, subject .to the $1800 incumbrance only on No. 22, for said twenty-seven vacant lots, incumbered for $1000, but not worth the incumbrance; that he relied upon said representations, and believed them to be true, and made the exchange without seeing the Clarendon Hills property, but shortly afterwards, upon inspection, he found that he had been victimized, and defrauded to the extent of $12,000, or more. The cross-bill contained a prayer that the contract, and. all deeds made thereunder, might be canceled, and that Anna Hanbury might be compelled to account for rents, etc. To the cross-bill Anna Han-bury filed a plea of former recovery in bar of the matters set .up in the cross-bill. In the plea it was averred that a certain cause had been determined in the United States Circuit Court for the Northern District of Illinois, wherein Emily Hoyt was complainant, and Knowlton, Hanbury, and others, defendants. The plea sets out copies of the pleadings in said cause as exhibits, and in substance avers that the subject matter of Knowlton’s cross-bill and the prayer for relief, as against Hanbury, is the same as the subject matter and prayer for relief in the bill interposed by Emily Hoyt in the United States Circuit Court. It is also alleged and set up -in the plea that the bill in the United States Circuit Court, on the hearing, was dismissed for want of equity, and that the decision is conclusive'of the matters .relied* upon.here. After the filipg of the plea the cause was set down for hearing, and on the hearing the court sustained the plea and dismissed the cross-bill. On the original bill the court found that Emily Hoyt, sister of Knowlton, was the holder of the note’ for $1800, secured by deed of trust, and decreed the payment of the note, and interest from June 25, 1881, to February 81, 1583, and that the note and trust deed be surrendered to the clerk of the court to be canceled. The court also found that Knowlton was indebted to Hanbury in the sum of $307.55, but this amount was not decreed to be paid, but Hanbury was left free to sue at law to recover said sum. Emily Hoyt, the holder of the note, acquiesced in the decree, but Knowlton' appealed.

Several alleged erroneous rulings of-the Superior Court are relied upon to reverse the decree,—first, in refusing to hear evidence of appellant in support of his cross-bill. Under the pleadings the evidence was not admissible. A plea of former adjudication was interposed by the complainant to' the matters set up in the cross-bill. Appellant did not reply to the plea. The truth of the facts therein alleged \?as admitted, and the only question for the court to determine W’as, whether those facts set up in the plea constituted.a bar to a recovery on behalf of appellant. Hence the offered evidence, had no bearing whatever on the question presented by the pleadings for the determination of the court. 1 Barbour’s Ch. Pr. 120; Rhode Island v. Moss, 14 Pet. 210; Story’s Eq. Pi. sec. 697.

Second—The court erred in dismissing the. cross-bill of appellant. If the matters in litigation in the case in the Circuit Court of the United States for the Northern District of Illinois were the same as those set up in the cross-bill, and between the same parties, it is clear .that the decree rendered in that court- must be held conclusive of the matters set up by appellant in the cross-bill. (Peterson v. Nehf, 80 Ill. 25.) In Story’s Equity Jurisprudence, see. 1523, it is said: “A former decree in a suit in equity between the same parties and for the same subject matter is also a good defence in .equity, even although it be a decree merely dismissing the bill, if the dismissal is not expressed to be without prejudice.” The law very properly gives every man a day in court, but litigation ought not to be encouraged, and when a matter has once been litigated and decided by a court of competent jurisdiction, that matter can not again be brought into litigation between the same parties, but the judgment or decree first rendered will be held conclusive between the parties. Here the plea interposed by Anna Hanbury clearly shows that the matters and things set up and relied, upon by Knowlton in his cross-bill and his prayer for relief, as against her, are substantially the same matters and things set up and relied upon by Emily Hoyt in her bill which was filed and passed upon in the Circuit Court of the United States. The appellant by his cross-bill makes the same case, and relies upon substantially the same grounds for relief, in this suit, as Emily Hoyt made in behalf of Knowlton in the Federal court. The main object of the bill in the Federal court was to rescind the trade which had been made between Knowlton and Anna Hanbury, on the ground of fraud. As we understand the cross-bill in this ease, its object is the same, and based upon the same grounds. In the case in the Federal court, Knowlton, .Hoyt and Hanbury were all properly, before the court, as they are here, and we perceive no tangible ground whatever upon which it can be held that the former decree is not a bar to a recovery here in' the case made or attempted to be made by the cross-bill.

It is also claimed that the court erred in reforming the written contract between the parties. Upon an examination of the decree we do not understand that this was done. On the other hand, the decree leaves the contracts as they were made by the parties.

Other questions of minor importance have been argued, but we perceive no substantial error in the record, and it will not be necessary to consider thQse questions.

The decree of the Superior Court will be affirmed.

Decree affirmed.

Soholfield, J., and Mulkey, C. J., dissenting.


author: Mr. .Justice Craig

text:
    David Preston et al. v. Gilbert A. Colby et al.

      Filed at Ottawa January 25, 1886.

    1. Creditor's bird—remedy at law—how far that remedy must he pursued, in order that equity may interpose. A creditor’s bill can not be sustained when there is no evidence tending to prove that the debtor has assets or property that can not be reached by execution, or which is covered up and kept out of the reach of creditors, or when it appears that the debtor has turned over property, real and personal, to the creditors, of sufficient value to satisfy the debt, before the filing of the bill.
    2. A creditor’s bill lies only when the creditor has exhausted his remedy at law. It must appear that the creditor has recovered judgment, and an execution issued thereon has been returned no property found. In other words, the theory is, in order to sustain such a bill, that the debtor has no property liable to be taken and sold in satisfaction of the judgment, on execution, but he has assets secreted or covered up, which can only be reached by bill in equity.
    3. If the debtor,-after judgment has been obtained, turns out to his creditors ample property to pay the debt, if converted into money, a court of equity will not sustain a bill to reach other property transferred by the debtor to some other party, on the ground that such transfer is fraudulent.
    4. A purchased of a banker real estate for $16,300, and afterward formed a partnership with B and G, for manufacturing plows, etc., and made valuable improvements upon the purchased premises, and borrowed of the banker $3000, for which the firm gave a judgment note, payable in ninety days. Afterward, A, in the absence of B, for the purpose of closing up the partnership business, obtained a deed for the property from the banker, and gave his notes, secured by mortgage, on the same, for $19,500, which included the purchase money, the interest thereon, and the $3000 firm note, which, however, was retained, and judgment confessed thereon. A, at the same time, turned over to the banker, as a security for the debt, all the personal property of the firm. The banker, after such transfer, filed a creditor’s bill, seeking to reach a deposit of B in his bank, which he had transferred by check to D, alleging fraud. After the filing of the bill the personal property of the firm so transferred was sold and converted into money, realizing about $1200, and it appeared that the real estate so mortgaged was of the value of $30,000: Held, that the creditor’s bill was premature, as the mortgaged property should first have been sold, even though a judgment had been recovered against A, after the purchase and before the giving of the mortgage.
    5. Partnership—as to individual and partnership properly—how to he applied, as respects individual and partnership indebtedness. The individual property of a partner is liable to be taken for the debt of his firm, when his creditors are not injured thereby and make no complaint. But when the rights of firm creditors and individual creditors are involved, the firm assets are not liable to be taken for individual debts until the firm liabilities are discharged, and vice versa.

    Appeal from the Appellate Court for the First District;— heard in that court on appeal from the Circuit Court of Cook county; the Hon. M. F. Tuley, Judge, presiding.
    Mr. Morton Culver, for the appellants :
    The officer’s return of milla bona ón the execution, authorized the filing of the -bill, though made before the return day. Bowen v. Parkhurst, 24 Ill. 257; Bank v. Gage, 79 id. 207; Alexanders. Tams, 13 id. 224; Ballentine v. Beall, 3 Scam. 206; Miller v. Davidson, 3 Gilm. 522; Manchester s. McKee, 4 id. 515.
    The check upon the bank failed to pass the -drawer’s funds in the bank, for the-reason he had not funds there sufficient to meet the same. Munn s. Burch, 25 Ill. 35; Marine Bank v. Rushmore, 28 id. 463; Insurance Co. v. Stanford, id. 168; Bank v. Bank, 68 id. 398; Brahm v. Adkins, 77 id. 263; Coates v. Preston, 105 id. 470; 2 Parsons on Notes and Bills, 78.
    As to when a voluntary conveyance is fraudulent as to creditors, see Moritz v. Hoffman, 35 Ill. 553; Bridgeford v. Riddel, 55 id. 261; Pratt v. Myers, 56 id. 23; Gridley v.

      Watson, 53 id. 156; Matthew v. Jordan, 88 id. 602; Patrick v. Patrick, 77 id. 555; Emerson v. Bemis, 69 id. 537; Mitchell v. Byrns, 67 id. 522; Sweeney v. Damron, 47 id. 450.
    Mr. George P. Westover, for the appellees:
    Complainants were bound to use the security in their hands placed there for the purpose of paying the partnership debt of Colby, Gardner & Co., before they could take legal proceedings to reach the individual property of Gardner.
    The original bill, seeking a discovery of assets, was properly dismissed, there being no evidence to sustain it, and the supplemental bill was properly dismissed for the same reason.
    The transfer of the money by Gardner was not fraudulent, in fact or in law, as it was made two months before this suit was brought.
    Complainants’ debt is against the firm of Colby, Gardner & Co. The money in question was of the individual property of Gardner, deposited, subject to his check, with complainants, as bankers, and complainants have in their possession sufficient of the firm property with which to pay their debt, and the law requires them to first exhaust that before resorting to the property of the individual members of the firm. Having . such property, assets and securities within their own possession and control, equity will not reach out to seize another fund upon which other parties have a claim, particularly when it is shown that they have made no effort to convert their securities into money.
   Mr. .Justice Craig

delivered the opinion of the Court:

This was a creditors’ bill, brought by David Preston, Samuel A. Kean and James Payne, a firm engaged in banking business, in Chicago, under the name and style of Preston, Kean & Co., against Gilbert A. Colby, Clinton H. Colby and Schuyler S. Gardner, a firm doing business as Colby, Gardner & Co. The bill was based upon a judgment, by confession, rendered in the circuit court of Cook county, December 17, 1881, in favor of the complainants, and against the defendants, for the sum of $3320.67. The bill was in the usual form. It sought discovery, under oath, and prayed for an -injunction and the appointment of a receiver. One of the judgment debtors, S. S. Gardner, kept an individual account in the bank of Preston, Kean & Co., and when the bill was filed he had to his credit, in the bank, $2111.46. For the purpose of reaching this sum of money, in satisfaction of the judgment, the complainants filed a supplemental bill, the material allegations of which will be set out hereafter. We will first consider the case made, or attempted to be made, under the original bill.

We find no evidence in the record to sustain the original bill. No testimony was offered tending to prove that Colby, Gardner & Co. had property or assets which could not be reached by an execution, or that was concealed or covered up, and kept out of the reach of creditors; but on the other hand, the evidence did show that all of the property, both-real and personal, belonging to Colby, Gardner & Co., before the filing of the bill, had been turned over by one member of the firm, to the complainants, to secure the indebtedness complainants held against the firm. Indeed, we do not understand it to be claimed in the argument of counsel that the evidence is sufficient to authorize a decree under the allegations of the original bill. We will therefore turn our attention to the case attempted to be made under the supplemental bill, as it is manifest complainants must succeed on this branch of the case, if at all.

The supplemental bill was filed November 8,1883, against the defendants in the original bill, and Isaac P. Coates. It alleges the filing of the original bill, and gives a statement of its contents. The bill also alleges that complainants, at the time of filing the original bill, were bankers; that Gardner, at that time, had on deposit $2111.46; that prior to that time Gardner had attempted to assign the same to one Isaac P. Coates, but had failed in so doing; that at the time of filing said bill and service of injunction, Gardner was the legal holder and owner of such deposit; that on or about November 23, 1882,-Gardner a second time, and in direct violation of the injunction in this case, attempted to assign said money to said Coates, by making a check therefor and delivering said check to Coates or his agent, with the fraudulent intent of assigning, in law, such deposit to Coates, so as to hinder and delay complainants in the collection of their judgment; that such transfer was merely colorable, and void in equity, and simply for the purpose of assisting Gardner, through Coates, to collect said money for his own use and benefit; that Coates has demanded payment of said check, which has been refused; that Coates then began suit on said check in the Superior Court of Cook county, in his own name, and threatens to prosecute the same to judgment; that Preston, Kean & Co. can not defend such suit successfully at law; makes Coates a defendant to this supplemental bill, and prays that he may be enjoined from prosecuting such suit, from bringing other suits, and from transferring such check; that such check be declared void; that the deposit be declared Gardner’s, and applied towards the payment of their judgment. Gardner and Coates put in answers to the supplemental bill, in which they denied all charges of fraud, and set up that complainants had ample securities in their hands belonging to the firm of Colby, Gardner & Co., to more than pay the judgment they held against the firm. They also set up that' before the filing of the bill, and on the 25th day of October, 1881, Gardner had on deposit in the bank of Preston, Kean & Co. a sum of money which he supposed amounted to the sum of $2190; that on that date he loaned the money to Coates, took his note for the same, and gave him a check on the bank for the amount; that the check was presented and payment refused. The defendants then set up that it afterwards appeared that Gardner did not have as large an amount in bank as was named in the check, the true amount being $2111.46, and when it was ascertained that the bank was not legally bound to pay the check, Gardner, in order to fulfill his agreement with Coates, and' to consummate the loan, gave a check for the true amount in bank.

It aj^pears from the record, that on' the 1st-day of May, 1881, Gilbert A. Colby purchased of Preston, Kean & Co. certain property in Chicago, at an agreed price of $16,300, to be paid in installments, as specified in a written contract executed by the parties on that date. It also appears that G. A. Colby, S. S. Gardner and C. H. Colby, in the spring of 1881, formed a co-partnership, for the purpose of manufacturing and selling certain plows manufactured under a patent held by the parties. Written articles of co-partnership were signed by the parties on the 5th day of July, 1881. The business of the firm was carried on upon the premises in Chicago which Colby had purchased from Preston, Kean & Co., valuable improvements having been placed thereon after the firm was formed.' It also appears that soon after the firm was formed, they borrowed of Preston, Kean & Co. $3000, and gave a judgment note for the amount, payable in ninety days from the date thereof. On or about the 1st day of October, 1881, in the absence of Gardner, Gilbert A. Colby, with the view of closing up the partnership business, obtained from Preston, Kean & Co. a deed of the property described in the contract of purchase. He then gave his individual notes to the firm for $19,500, secured by a deed of trust on the property. The sum so secured was made up of the following items: $16,300, purchase money for the premises; $3000, which had been borrow'ed from Preston, Kean & Go., and.$200, back rent under the written contract of purchase. The firm note for $3000 was not, however, surrendered, but retained, and judgment confessed on it, which is the judgment attempted to be collected by this creditor’s bill. At the same time, and as a part of the same transaction, Gilbert A. Colby turned over to Preston, Kean & Co., as security for their debt, in addition to the deed of trust, all the personal property which was in the possession of Colby, Gardner & Co., so that at the time of the filing of the original bill in this ease, the complainants, Preston, Kean & Co., had received from Colby, Gardner. & Co., as security for their debt, all real and personal property which the firm at that time owned.. Since the filing of this bill the personal property has been sold and converted into money. A part was sold by Preston, Kean & Co., and a part by a receiver appointed by the court under a bill to wind up the business of Colby, Gardner & Co. The real estate was also sold by the receiver, subject to the' mortgage of Preston, Kean & Co., and purchased by Morton Culver, the attorney of Preston, Kean & Co., in. the name of one Allen Breed, a resident of Iowa. But the mortgage of Preston, Kean & Co. on the real estate embraced therein, has not been foreclosed, although the property, as appears from the record, is worth $8000 or $10,000 more than the mortgage indebtedness.

In the argument the broad ground has been taken that partnership debts must be paid out of partnership assets, and separate debts out of private or individual assets. There is no doubt in regard to the rule that where the rights of firm creditors and individual creditors are involved, firm assets are not liable to be taken for individual debts until the firm liabilities are discharged, and that individual property can not be taken to pay firm liabilities until the individual debts are paid; but that rule has no application here, under the facts disclosed by the record. When the complainants obtained a judgment against Colby, Gardner & Co., the rights of no individual creditors being involved, they had the right, so far as the question raised is concerned, to subject any property belonging to the firm, or the individual members of the firm, to the payment of the judgment.

But there is another question presented which is not so free from difficulty, nor is it readily solved. It will be borne- in mind that on or about the first day of October, 1881, Colby, Gardner & Co. turned over' all the property owned by the firm to secure complainants’ debt,—that a large portion of that property is held by Preston, Kean & Co. in the same condition that it was in when it was turned out as security. Under such circumstances, have they the right to go into a court of equity to reach assets belonging to Gardner or his assignee ? The principal ground upon which a court of equity entertains a creditor’s bill, is that the remedy at law has been exhausted. In order to maintain a creditor’s .bill it must appear that a judgment has been rendered, an execution has been issued and placed in the hands of the sheriff, and that it has been returned no property found. In other words, the theory is, that the judgment debtor has no property liable to be taken and sold in satisfaction of the judgment, on execution, but that he has assets secreted or covered up, which can only be reached by a proceeding in equity. But suppose the judgment debtor, after judgment has been obtained, turns out to his creditor ample property to pay the debt if it was converted into money, would a court of equity in such a case entertain a bill to find other property which had been transferred in some other direction ? There would seem to be no necessity for a bill in such a ease. Where the judgment creditor has ample property turned out to him to pay his claim, what necessity for going into a court of equity ? Here the entire debt of the complainants amounts to $19,500, and some interest. Something over $1200 has been made on property sold, and the real estate embraced in -the mortgage to secure the debt, as the proof shows, is worth some $30,000. All this property was voluntarily turned over to the complainants by Colby, Gardner & Co., and in our opinion equity demands that it should be exhausted before they can be permitted to invoke the aid of a court of equity for the purpose of reaching other assets.

But it is said that in 1879 one Gorham obtained a judgment against Colby, upon which the property was subsequently sold, and the sale will be good and valid except as to the sum Colby owed Preston, Kean & Co. for purchase money, which was $16,300,—that the mortgage affords no security for the balance of the $19,500 which it was given to secure. What title Gorham obtained under his judgment sale, as against the mortgage of Preston, Kean Sa Co., has never been determined. In Breed v. Gorham, 108 111. 81, it was decided that where an execution issued on a judgment in a court of record within one year from the time it was rendered, the judgment will become a lien on real estate the defendant in the judgment may afterwards, and within seven years, acquire; but nothing is decided in that case in regard to the priority of tire lien of the judgment or the mortgage. That is a question which will have to be determined in a proper ease between Gorham, and Preston, Kean & Co. It is but just that Preston, Kean & Co. should be required, as the property they hold is of much greater value than the debt, to convert it into money, and then, should it turn out not to be sufficient to pay their debt, it will be time enough to look after other assets by a creditor’s bill.

If we are correct in the view we have taken of the ease, that the filing of the bill was premature, it will not be necessary to remark upon the validity or invalidity of the transaction between Gardner and Coates.

The decision of the Appellate Court affirming the decree of the circuit court dismissing complainants’ bill, will be •affirmed.

Decree affirmed.

Mr. Justice Scott : I do not concur in this opinion.


author: Mr. Chief Justice Mulkey

text:
    Michael W. Ryan et al. v. The People, for use of Town of West Chicago.

      Filed at Ottawa March 6, 1886.

    1. Town colijEOTob— excess of the two per cent commissions over $1500—into what treasury to be paid—town or district. Section 36, chapter 53, of the Revised Statutes of 1874, declares: “Each town or district collector shall be allowed a commission of two per cent on all moneys collected by him, to be paid out of the respective funds collected: Provided, * * * that all excess of commission and fees over $1500 shall be paid into the town or district treasury. ”
    2. This is construed to mean, that in the case of a town collector, which • appertains alone to counties under township organization, such excess shall in all cases be paid into the town treasury, and not elsewhere.
    3. The “ district treasury” mentioned in the act, means the county treasury in counties not under township organization, each county in the State within that class being, for the purpose of collecting taxes, a “collection district,” and the sheriff of the county is, by virtue of his office, “district” collector. And so the distinction is to be taken between the “town collector” and the “district collector,” and correspondingly as to the “town treasury” and the “district” or county treasury, in respect to which shall be entitled to receive the surplus of the two per cent commissions over and above the $1500 allowed to the collector as his actual compensation.
    4. In this case the town collector of the town of West Chicago, which embraces a portion of the city of Chicago, had collected for a given year, town taxes, State and county taxes, and, with others, city taxes. The excess over $1500 of commissions on all the taxes so collected was paid by the collector into the town treasury, except that arising from the city taxes, which he declined to pay, and to recover which the town brought suit upon his official bond. A recovery was had, and was sustained by this court.
    5. Same—constitutionality of the act in so disposing of the commissions on the city taxes. The construction given to the statute which requires the excess of the commissions on the city taxes -collected by the town collector to be paid into the town treasury, does not render the act obnoxious to the constitutional objection that the levy of that portion of the taxes for such a purpose was not for a corporate purpose. The legislature had the power to require the city taxes to be collected by the town collector, and in doing so, to give the direction it- did to the commissions arising therefrom.

      Wbit of Ebbob to the Appellate Court for the First Dis-' trict;—heard in that court on appeal from the Superior Court of Cook county; the Hon. Sidney Smith, Judge, presiding.
    Mr. A. W. G-been, for the -plaintiffs in error.
    Messrs. Mooee & Bbowning, for the defendants in error.
   Mr. Chief Justice Mulkey

delivered the opinion of the Court:

The town of'West Chicago brought an action of debt in the circuit court of Cook county, against Michael W. Ryan and his sureties, on his official bond, as collector of said town, to recover an alleged balance in his hands due the town on account of the taxes collected by him for the year 1881. The court overruled a general demurrer to the declaration, and the defendants declining to answer further, final judgment was thereupon entered against the defendants for the amount of the town’s claim. On appeal to the Appellate Court that judgment was affirmed. The case is brought here by writ of error.

It is shown, by proper averments in the declaration, that Ryan collected the taxes for the year 1881, consisting of the following items: Park taxes, $35,932.92; town taxes, $16,-151.61; State taxes, $57,480.86; county taxes, $74,240.40 ; city taxes, $415,137.36; West Park taxes, $35,932.92; that the two per cent commission allowed by law for the collection of said taxes is as follows: On park taxes, $718.66; on town taxes, $323.03; on State taxes, $1149.61; on county taxes, $1484.80 ; on city taxes, $8302.74, amounting, in the aggregate, to $11,978.84; that out of this sum the collector retained $1500 for his own use, and paid the balance to the town treasurer, except the said sum of $8302.74, commission on said city taxes, which he declined to pay, and to recover which this suit was brought.

The simple question for determination is, whether, under the circumstances stated, the refusal of' the collector to pay over to the town treasurer the two per cent commission on the city taxes, constitutes a breach' of his official bond. The answer to this depends chiefly on the construction to be given to the concluding part of section 36, chapter 53, of the Revised Statutes, which requires collectors to ¡Day into the town or district treasury all excess of commissions and fees over $1500. Any construction of this requirement of the statute which is not in harmony with the other provisions of our revenue system, ought not to be accepted as the true one.

An examination of the subject shows that the statute contains two partially distinct systems for the assessment and collection of taxes, one of which pertains to counties under township organization, and the other to counties not under township organization. Both of these systems are in the main provided for in one consolidated act of the legislature. Some of the sections constituting the act relate exclusively to counties under township organization; others apply to counties not under township organization, while there are yet others applicable to both classes of counties,—that is, contain provisions referring to or including both classes. Of the latter kind is section 36, chapter 53, of the Revised Statutes, just referred to, and upon the construction of which the case before us mainly depends. That section, after providing for the compensation of certain officers therein named, concludes as follows: “Each town or district collector shall be allowed a commission of two per cent on all moneys collected by him, to be paid out of the respective funds collected: Provided, that in any case where "the compensation so allowed shall be insufficient, the town or county board may allow an additional compensation or per diem in lieu of other or greater commissions, in which case said additional compensation shall be paid out of the town or county treasury, as the case may require And provided farther, that all excess of commissions and fees over $1500 shall be paid into the town or district treasury.” The part of the section cited, clearly refers, in more than one instance, to the respective systems which prevail in the two classes of counties mentioned,—that is, such as have and such as have not township organization. Take the expression, for instance, “the town or county board may allow additional compensation, ” etc. Now, it is evident the Word “town,” in this connection, can apply only to counties under township organization, while, on the other hand, the expression, “county board, ” clearly has exclusive reference to counties not under township organization. So the expressions, “town collector, ” and “town treasury, ” apply only to the former class of counties, while the terms, “district collector,” and “district treasury, ” refer exclusively to the latter class,—that is, to counties not under township organization. That such is the proper construction of the above provision will abundantly appear when it is considered in connection with other sections of the Revenue act presently to be noticed.

Section 4, article 9, of the constitution, provides:

“The General Assembly shall provide, in all cases where it may be necessary to sell real estate for the non-payment of taxes or special assessments for State, county, municipal or other purposes, that a return of such unpaid taxes or assessments shall be made to some general officer of the county having authority to receive State and county taxes, and there shall be no sale of such property for any of said taxes or assessments but by said officer. ” It is clear, from this provision of the constitution, that in either class of counties there must be not only an officer to collect taxes from the tax-payers, but that there must also be “some general officer of the county authorized to receive taxes,.” and to whom a return may be made of the unpaid or delinquent taxes. The general Revenue act, passed shortly after the adoption of the constitution, contains a number of provisions which fully meet this constitutional requirement. Thus, section 144 provides for county collectors, and specifically determines who shall fill the office and discharge the duties pertaining to it, in both classes of counties. The section is as follows : “The treasurers of counties under township organization, and the sheriffs of counties not under township organization, shall be ex officio county collectors of their respective counties.” The 169th section provides “that town and district collectors shall return the tax books, and make final settlements for the amount of taxes placed in their hands for collection, on or before the 10th day of March next after receiving the tax books: Provided, that the county collector may first notify,- in writing; the several-town or district collectors upon what day, within twenty days after the 10th day-of March, they shall appear at his office to make final settlement.” It will he.observed that in the introductory part of this section “town and district collectors” are mentioned conjunctively, and must therefore necessarily refer to two distinct classes of collectors, both of which are required to make returns to and settlements with county collectors. Now, so far as counties under township organization are concerned, it is quite clear, as we have already seen, there is no such an office as that of “district collector” provided for, and it is equally clear there is. not the slightest necessity for one, as all taxes are required to be collected by the town collector, and returns thereof to be made, to the county collector,.v

It is important, then, to ascertain just what is meant by district collector, for when that is done the proper construction of the expression, “district treasury, ” as it occurs in section 36, chapter 53, above cited, will naturally follow. As district collectors, like town collectors, must make returns to and settlements with county collectors, the question arises, what is meant by the term district collector,.or collectors, as it runs through our entire Revenue act? This question is fully answered by the 140th section of that act. It is as follows : “Bach county in this State not under township organization shall be a collection district, for the purposes-of this act, and the sheriffs of such counties shall he respectively ex officio district collectors of such collection districts. ”

It is manifest from this section, when considered in connection with section 144, above cited, that the sheriff, in counties not under township organization, by virtue of his office as sheriff, fills two additional and distinct offices, namely, district collector and county collector,—that is, the two offices unite in one person, the sheriff. Any other view of the subject would render our system of tax sales obnoxious to the provision of the constitution above cited. Thus, the sheriff, in counties not under township organization, as district collector collects the taxes directly from the tax-payers, and makes returns to the county collector,—that is, the sheriff, in his capacity of district collector, makes returns to and settlements with himself in his character of county collector. The sheriff, as county collector, has nothing to do with the collection of taxes from the tax-payers until after the tax books have been turned over to him by the sheriff, in his capacity of district collector, after which the statute authorizes him, as county collector, to collect and receipt for the taxes on the delinquent lists. The view here taken is clearly sustained by section 172, which is as follows : “And in counties not under township organization it shall be the duty of the district collector to make return of the taxes.uncollected in his hands, to the county collector, under oath, * * * whereupon the county collector shall at once proceed to the collection of the taxes appearing upon said tax books as unpaid, in the manner now provided by law for the collection of delinquent taxes. ”

From the foregoing review, the conclusion seems irresistible that each county in the State not under township organization, is, for the purposes of collecting taxes, a “collection district, ” not only in fact, but in name also, as is exjnessly declared in the 140th section above cited,—that the sheriff of every such county is, by virtue of his office, district collector, and is so expressly designated and declared to be by the same section. Since a district, for purposes of collecting taxes, means simply a county not under township organization, it follows, the term “district treasury, ” occurring in the same law, means the county treasury in a county of that class. But it does not mean the county treasury in the other class of counties, and for this very reason we have no doubt the term “district treasury” was chosen by the framers of the law. Had the expression “county treasury” been used in its stead, as that "term is applicable to both classes of counties, it would have given at least color for the claim that the town collector, in counties under township organization, could pay this excess of commissions into the county treasury .or town treasury, as he might elect. The framers of the law, therefore, no doubt, used the term “district treasury” for the express purpose of removing all claim for such a construction, and of excluding all question as to the duty of town collectors to pay such excess into the town treasury.

A careful examination of the various provisions of the Revenue law conclusively shows that the terms “district, ” “district collector” and “district treasury,” as therein used, have exclusive reference to counties not under township organization, so that the conclusion is irresistible that it was the duty of the town collector to pay the money in controversy into the town treasury, and having failed to do so, it was a clear breach of his official bond.

Conceding this to be the proper construction of the statute, the objection is interposed that the city has no constitutional power to levy this two per cent of the taxes for the purpose of being retained by the town collector and by him paid over into the towm treasury; that the levy and collection of it for such a purpose is not a corporate purpose, and hence it is concluded that the law authorizing it to be done is unconstitutional and void. However plausible this view may seem, we are satisfied that it is unsound, and can not be maintained. If the legislature, in, its wisdom, had imposed the duty of assessing and collecting the city taxes, upon the city itself, instead of upon town officers, as it has, there would be some plausibility in the position; but as it is, there is none.

As to the supposed equities of the case discussed by counsel, we have nothing to do with that matter. Besides, we perceive no force in it. This excess is paid into the town treasury for the benefit of the very persons from whom it is collected, and no hardship is discovered in this. The question with which we are concerned is, where does the law require this money to be paid ? • We have already seen it must he paid into the town treasury, and that is all there is in this case.

The judgment will be affirmed.

Judgment affirmed.

Scott, Sheldon and Craig, JJ., dissenting.


author: Mr. Justice Shops

text:
    Henry A. Biederman v. Michael O’Conner.

      Filed at Ottawa March 27, 1886.

      1. Arrest 03? judgment—on ground of immaterial issues. Judgment •will not be arrested, on motion of the plaintiff, on the ground that certain special pleas present immaterial issues, if the general issue has also been filed, and the finding of the jury is general, in favor of the defendant.
    2. Evidence—as to delivery of contract—presumption—evidence in rebuttal. The possession of a contract or written obligation by the vendee or obligee therein named, affords presumptive evidence of its delivery to him, but it is not.conolusive; and evidence tending to prove fraud in obtaining the possession of the writing, or to show that it was not in fact delivered, is always admissible.
    3. Contract—want of delivery—fraudulent possession. A party signed a contract for the sale of a quantity of corn at a stated price, to be delivered in the future, upon the understanding that he was to have $1000 paid down. The purchaser took possession of the contract without paying anything, the maker, objecting and protesting, and it was finally agreed between them that if the $1000 was paid by eight o’clock of the next morning, the contract was to hold good, otherwise not. In the morning no money was produced, but a check was tendered, and refused, the drawer not having funds in bank to meet it: Held, that the contract never became binding, for want of delivery, and that the possession of the same was fraudulent.
    4. Pleading and evidence—proof under the general issue. Under the general issue in an action ex contractu, the defendant may give in evidence anything which tends to show that the plaintiff never had any cause of action. So he may show that the instrument sued on never became a valid contract for want of delivery, or on account of non-performance of a condition precedent to its taking effect; and such evidence does not vary or change the terms of a written contract.
    5. Consideration—extension of time for payment. Where a contract is made for the sale of corn upon condition that a given sum is paid down in advance, and the purchaser, not having the money, is given until the next morning to get the same, no new consideration is necessary to the extension of the time of performance.
    6. Infancy—infant can not avoid contract in part. If an infant agrees to pay a certain sum in advance as a consideration for the execution and delivery of a contract for the sale and delivery of corn, he will not be permitted to shield himself from performance on his part, and hold the vendor to do that which he was to do only upon the condition of the infant performing his part.
    Writ of Error to the Appellate Court for the Second District ;—heard in that court on appeal from the Circuit Court of Knox county; the Hon. Arthur A. Smith, Judge, presiding.
    Messrs. Willoughby & Dougherty, for the plaintiff in error:
    A party selling corn for future delivery may annex such conditions as he pleases, but if the contract is reduced to writing and delivered, they can be shown only by the writing, which can not be enlarged or diminished by parol evidence as to the agreement of the parties. Bishop on Contracts, sec. 58.
    All antecedent verbal propositions and discussions are, so far as.agreed upon by the parties, incorporated into the written contract,—all else is intentionally excluded. Verbal evidence can not be heard to contradict or vary the terms of the written agreement. The rules apply with equal force to written propositions for a contract. Adair v. Adair, 5 Mich. 210; Piehrel v. Rose, 87 Ill. 263; Martin v. Hamlin, 18 Mich. 354; Beers v. Beers, 22 id. 43; Ward v. Lewis, 4 Pick. 518; Weaver v. Fries, 85 Ill. 356; Snider v. Griswold, 37 id. 216. The contract can not rest partly in parol and partly in writing. Marshall v. Gridley, 46 Ill. 247; Barrington v. Railroad Co. id. 297.
    There was no consideration for the plaintiff’s promise to bring $1000 by eight o’clock next morning. The contract .was before that consummated. If plaintiff did agree to bring the $1000 next morning, it was a mere gratuity. Then, again, he was a minor, and if it had a consideration, he had a right to plead his infancy to it, which was done.
    Defendant’s fourth and fifth instructions are erroneous. The parties have a'right to vary a written contract by a subsequent parol agreement, but there must be a consideration for the contract so made, for it becomes a new contract. The same is true of the ninth and other of defendant’s instructions. If a paper is delivered as an escroto, it is a queer thing to place it in the hands' of the opposite party. Dawson v. Hall, 2 Mich. 390.
    Many of defendant’s instructions are bad, as having no evidence upon which to be based.
    "When a case is tried upon immaterial issues tendered by pleas, and a verdict is given for the defendant upon such issues, the court, on motion, should arrest judgment, and enter judgment for the plaintiff non obstante verdicto.

    Messrs. McKenzie & Calkins, for the defendant in error:
    The court could not usurp the province of the jury, and render a judgment for the plaintiff. If it should, for how much ? Besides, the general issue was not an immaterial one.

      A contract delivered conditionally to either party, or his agent, only to take effect on a certain specified event, does not take effect unless such event transpires. Railroad Co. v. Hall, 1 Bradw. 612.
    Even if several erroneous instructions were given, yet if the court can see that substantial justice has been done, the judgment will be affirmed. Conklin v. Burdick, 6 Bradw. 153; Stallings v. Board of Trustees, id. 165; Hubner v. Feige, 90 Ill. 208; Race v. Oldridge, id. 250.
   Mr. Justice Shops

delivered the opinion of the Court:

This was a suit brought in the Knox circuit court, by plaintiff in error, against defendant in error, to recover damages for his failure to deliver 10,000 bushels of corn according to the terms of the following contract in writing:

“Galesburg, III., June 5, 1882.
“Mr. M. O’Conner promises to deliver Mr. H. A. Biederman 10,000 bushels of good corn, this fall of 1882, at twenty cents per bushel. M. O’Conner.”

The defendant filed the general issue and several special pleas, upon all of which issue was taken. A trial resulted in a verdict for defendant. Motions for new trial and in arrest were severally overruled, and judgment rendered on the verdict, and against the plaintiff, for costs. The case was taken, by appeal, to the Appellate Court for the Second District, where the judgment of the circuit court was affirmed, and the present writ of error is prosecuted to that court by the plaintiff below.

Very many of the errors assigned have been .eliminated from the case by the judgment of the Appellate Court.

The plaintiff in error insists that each of the special pleas presented an immaterial issue, and that for .that reason the judgment should have' been arrested. Without pausing to discuss the correctness of the practice indicated, it will be sufficient to say that the general issue'filed presented a material issue, and therefore no such practice would have been warranted. . i

It is also insisted that the court erred in admitting in evidence, over the objection of plaintiff, conversations preliminary to, and contemporaneous with, the signing of the instrument sued on, and many authorities are cited to sustain the position that all such contemporaneous matters are merged in the writing, and are not admissible to vary its terms. These authorities undoubtedly state the law correctly; but have no application to this case, for the reason that the evidence offered and admitted was admitted for no such purpose, and produced no such effect.

Authorities are also cited sustaining the position that no agreement made at the time of the delivery of a contract in writing, in respect to its delivery, repugnant to the legal effect of the instrument, or for its re-delivery upon conditions, is competent to be proved by parol, and therefore it is insisted the court erred in admitting the attending conversations and circumstances at the time of the signing of said writing. We have no disposition to depart from the rule laid down in these cases, but it will be found in each of the eases cited, there was a delivery in fact of the instrument'in writing, or the maker had so acted in respect to the instrument that the rights of third persons would be prejudiced if he was permitted to insist upon its non-delivery, and was therefore estopped from insisting thereon. - Mere possession by the vendee or obligee will raise the presumption of delivery, but it has never been held to be conclusive, and it is the well settled doctrine that evidence tending to prove fraud in obtaining possession of the writing, or to show that it was not in fact delivered, is always admissible. Under the general issue, the defendant might, introduce in evidence any matters tending to show that plaintiff never had cause of action. 1 Chitty’s PL 478.

• Delivery of the writing being essential to its validity as a contract, evidence tending to establish its non-delivery would be competent under that issue. In this view it will be unnecessary, in considering the relevancy or competency of the evidence objected to, to consider the issues raised by the special pleas. The evidence objected to is that of the defendant and his daughter, who, with the plaintiff, were the only persons present at the time of the alleged making and delivery of the contract. This evidence was, in substance, that in the evening of the 5th day of June, 1882, plaintiff had called at defendant’s house, and while there, the defendant came in, and in general conversation plaintiff expressed the opinion that the unfavorable weather would cut short the corn crop,' and corn, in consequence, would command a high price. The defendant replied that there was a good stand of corn, and there would be plenty of it,—that he would not be afraid to contract a man all .he wanted at twenty cents a bushel. The plaintiff said, “I would like to take 10,000 bushels at that price,” and proposed drawing a contract,— to which defendant replied, “If you will pay me $1000, cash down, you may draw up a contract. ” Plaintiff said he would do it, and immediately drew the writing sued on. The defendant reached over and signed it, and said to plaintiff, “Now, - where is your $1000?” The plaintiff replied that he did not have “any thousand dollars,” but said, “Mike, I can give you my check, but I haven’t any money in the bank,” or, “haven’t that much in the bank. ” The defendant immediately said, “I don’t want your check,—I want the money. ” The plaintiff thereupon, instead of producing the money, picked up the writing and put it in his pocket. The defendant protested, and said, “I didn’t sign that to have you snatch it up and take it off in that way. ” The plaintiff kept the writing, and it was finally agreed that if he brought the $1000 in money by eight o’clock the next morning, it was to be a contract, otherwise not. The next morning the plaintiff .came to defendant’s house, and again tendered a check, which was refused by defendant, who demanded the destruction of the writing.

It is evident that the defendant did not, at any time, consent to the plaintiff’s taking the writing, but at all times insisted upon the payment of the $1000 as a condition precedent to the contract taking effect. This he would have a right to do, and without his assent to the delivery of the contract it could not become binding or effective, and the possession thereof, if taken as shown by this evidence, was fraudulent. It will require the citation of no authority to maintain the position that this evidence was admissible as tending to show that the waiting was not in fact delivered. Indeed, there is much in the record to sustain the view that there was no intention, on the part of either plaintiff or defendant, to make a binding contract. The conversation started in badinage. When the defendant was about to sign the contract, the evidence shows that the daughter advised her father not to sign it, and when pressed by plaintiff’s counsel for her reason for so doing,- testified that she did so because she was afraid Henry (the plaintiff) might have $1000. The plaintiff’s visit was a mere friendly call, with no intention of buying corn, yet he agrees to pay $1000 down when he knows he has not got it; offers his check on a bank where he has no funds, and finally consents it shall be “no contract” unless he is there with the sum of $1000, in money, by eight o’clock the next morning,—fully an hour, as his counsel admit, before any bank in the city would be open. It is true that some of this evidence is disputed by plaintiff, but he is wholly uncorroborated, whilst the defendant and his daughter substantially agree. No further attention seems to have been paid to this alleged contract, by either party, after the morning of the 6th of June, until the latter part of No-.' vember, when plaintiff wrote a letter to defendant demanding the corn, and designating a place of delivery. It is not pretended that a tender was ever made of the $1000, or any other sum, by plaintiff, until between the 6th and 10th of December, when the plaintiff claims to have tendered the defendant $1000 in gold. But here, again, he is contradicted by the defendant, who says no tender was made, but that the plaintiff had a bag, -in which he said he had $1000, and said to defendant, “I want to show you I could make you a tender. ” The defendant is corroborated by the witness Inness, who is shown to have been present at time of the alleged tender.

The finding of the jury being with the.'decided weight of the evidence, and every important question involved arising under the general issue, it will not be important in this cáse, nor profitable in any other, to take up and discuss in detail the objections to the various instructions given for defendant, or the modification or refusal of those asked by the-plaintiff. Special pleas presenting almost every conceivable issue, material and immaterial, were filed, and issue taken on them, and at the trial each party asked instructions upon the theories raised by these pleas. We have carefully considered the whole series, and, while many are objectionable, we find no. error for which the cause should be reversed. A number of 'instructions are given, for each party, laying down the rule of law as to wagering contracts, which, if correct in other respects, should have been refused, because there is no evidence on which to base them,—and the same can be said of others of the series. Upon the question presented, and material to the determination of the case,—that is, whether a contract was made by the parties, and if so, whether the plaintiff had complied on his part,—the law went to the jury correctly.

It is urged that if the agreement was that the $1000 was to be paid by eight o’clock the. next morning, there are two reasons why the defendant could not set that up: First, that such agreement on the part of the plaintiff was without consideration, and therefore void. This is untenable. The contract was to pay $1000 down. This, plaintiff was unable to do, and being unable, the right to pay it the next morning was a simple extension of time to him in which to make the payment. It might as well be said there was no consideration for the promise to pay, in the first instance. Second, it is said that the plaintiff was a minor, and therefore not bound by his promise, and that infancy was properly replied. This position can not be maintained. He had agreed to pay $1000 as consideration for the execution and delivery of the contract by defendant. He can not be permitted to shield himself from performance, on his part, and hold the defendant to do that which he was to do only upon the plaintiff’s performing on his part. Not a dollar had been paid. No right of the plaintiff was in jeopardy. The agreement was to become binding upon the infant’s paying the money, and not until then, and he can not relieve himself from performing, and insist upon the validity of the contract.

Upon the whole case, we think the judgment clearly right, and that substantial justice has been done, and the judgment of the Appellate Court will be affirmed.

Judgment affirmed.