author: Mr. Justice Craig

text:
    The Massachusetts Mutual Life Insurance Company v. Maria Boggs.

      Filed at Ottawa May 12, 1887.

      1. Setting aside trustee’s sale—whether sale nlade in pursuance of ■the power—presumption. On bill to set aside a trustee’s deed made under a power requiring the sale to be made on the premises, on the alleged ground the sale was not made at the time it was advertised nor on the premises, the burden of proof rests upon the complainant, the presumption being that a person charged with a trust performs his duty, until the contrary is made to .appear.
    2. Same—of laches in filing a bill to set aside trustee’s deed, and .for redemption. A trustee’s deed of land purported to have been made on the premises on December 12,1878. The owner never acquiesced in the sale, but disputed its validity, and refused to surrender possession until dispossessed by legal proceedings, contested for several years, and within a reasonable time after the suit for possession was decided, to-wit, in March, 1884, he filed his bill to set the deed aside, on the ground no sale had in fact been made at the time and place specified in the notice, there being no intervening rights of innocent purchasers: Held, that there was no such laches as to prevent the relief sought.
    3. If the power of sale had in fact been executed, but the execution had been merely irregular or defective, and in the meantime the rights of innocent purchasers had intervened, a different question might arise. But there being no sale, in fact, when the creditor obtained possession under the trustee’s deed, he went in as mortgagee, and held as such, and a bill to redeem would lie at any time until barred by the Statute of Limitations.
    4. Usury—commission paid to loan agents. A party desirous of a loan applied to the agents of an insurance company, employed to procure life insurance only, who obtained the loan of the company at the highest legal rate of interest, and exacted of the borrower a commission of two and a half per cent, but the evidence showed that the company loaning had nothing to do with the commissions and derived no benefit therefrom, and never authorized any commission to be charged: Held, that the loan was not usurious by. reason of the payment of the commission to the loan agent by the borrower.
    Appeal from the Circuit Court of Cook county; the Hon. M. F. Tuley, Judge, presiding.

      Mr. Henby C. Noyes, and Mr. James E. Munboe, for the appellant:
    The trustee’s deed could not he vacated, even if there was-usury in the loan. Insurance Co. v. Tyler, 108 Ill. 58; Lake v. Brown, 116 id. 83.
    The burden was upon the appellee to show that no sale was made at the time and place required by the notice and the contract. Munn v. Burgess, 70 Ill. 604.
    When the trustee has not only a power to convey, but the legal title also, and he has conveyed, in the absence of proof to the contrary it will be presumed (when his action is challenged, in equity,) that he has performed his duty. Burke v. Adair, 23 W. Ya. 139.
    The recitals in the trustee’s deed, of the time, place and manner of making the sale, are prima facie evidence of the facts recited. Miller v. Shaw, 103 Ill. 277; Breit v. Yeaton,. 101 id. 242.
    Where, as in the case at bar, the trust deed provides that, the recitals in the trustee’s deed, thereunder made, concerning notice, and the time, place and manner of the sale, shall be prima facie evidence of such facts, such recitals are, until rebutted, sufficient evidence of the facts, and full faith and credit must be attached to them. Carter v. Abshire, 48 Mo. 300; Carey v. Brown, 62 Cal. 373.
    The sale in question was properly made at the place described by Mr. Bappleye—on the edge of the sidewalk in front of the premises, close to the building on the land. The power-authorized the sale to be made “at or oh” the premises. “At the premises, ” means close or near by the premises. It denotes nearness or proximity. Ray v. State, 60 Ala. 172; Bartlett v. Jenkins, 22 N. H. 63; State v. Receiver of Taxes, 9 Vroom, 229.
    The laches of appellee was such that the relief was barred. Cox v. Montgomery, 36 Ill. 396; Williams v. Rhodes, 81 id. 589; Hamilton v. Lubukee, 51 id. 415; Bush v. Sherman, 80 id. 160; Hoyt v. Pawtucket Institution, 110 id. 390; Cleaver v. Green, 107 id. 67.
    Mr. William H. Sísson, and Mr. C. F. Gooding, for the appellee:
    If no legal sale was ever in fact made, the laches of the appellee, even if proven, can not affect her right to relief. Gibbons v. Hoag, 95 Ill. 69.
    An immediate purchaser at a trustee’s sale must see that all the precedent conditions of the sale are complied with. Carsell v. Ross, 33 Ill. 244.
    To set aside such a deed, the evidence need not show that no sale at all was made. McVey v. McQuality, 97 Ill. 93.
    The loan being usurious, Mrs. Boggs had the right to an accounting, and to have all payments applied on the principal debt. Hadden v. Ives, 24 Ill. 381; Farwell v. Meyer, 35 id. 411; Taylor v. Daniels, 37 id. 331; House v. Davis, 60 id. 367.
    Mr.' Arthur W. Windett, and Mr. W. T. Burgess, also for the appellee:
    It is the duty of a trustee to adopt all reasonable modes to make the property most beneficial to the debtor, and he can not become the purchaser, either directly or indirectly. Howard v. Ames, 3 Metc. 308; Whitcomb v. Minchin, 5 Mad. 91; Ventris v. Cobb, 105 Ill. 38.
    The company is bound to a strict performance of duty by the trustee. Insurance Co. v. Fisher, 106 ill. 190; McVey v. McQuality, 97 id. 93; Robbins v. Butler, 24 id. 387; Dennis v. McCagg, 32 id. 444; Ross v. Demos, 45 id. 447; Harper v. Ely, 56 id. 193.
    In Burr v. Borden, 61 Ill. the court said: “Powers of this sort are regarded with such jealousy, that sales under them, if attacked in due season, and before the claims of third persons have intervened, will be set aside if not conducted with complete fairness. Such sales will be strictly scrutinized.” Longwith v. Butler, 3 Gilm. 43; Flint v. Lewis, 61 Ill. 305.

      Walker, as the company’s agent, conducting the sale by directing and controlling Rappleye’s action, could not, for himself or for the company, either in the name of Avery J. Smith, another agent, or in its own name, bid off or become a buyer of the property at that sale. All his action was the company’s action. The company was both mortgagee, seller and buyer. Story on Sales, 89; Greenwood v. Spring, 54 Barb. 375; New York Central v. Insurance Co. 4 Kern. 85; Farnsworth v. Hemmen, 1 Allen, 494; Bloy’s Trust, McN. & Gr. 497.
   Mr. Justice Craig

delivered the opinion of the Court:

This was a bill brought by Maria Boggs, in the circuit court of Cook county, against the Massachusetts Mutual Life Insurance Company and others, to vacate a sale of certain premises in Chicago, under a trust deed executed by the complainant and her husband, to Nicholas B. Bappleye, to secure a loan of $12,000, and interest, which she had obtained from the insurance company, and also to redeem the premises from the deed of trust, and from a subsequent deed of trust executed for a second loan. It was also alleged in the bill that both deeds of trust were usurious. On the hearing, on the pleadings and evidence, the court found that there was no usury in ihe transaction. The court also found, that on December 12, 1878, a trustee’s deed was recorded in the recorder’s office in Cook county, of that date, made by Bappleye, as trustee, to Smith, which set out the trust deed securing the $12,000 loan, default in payment of interest notes and of the principal note thereby secured, and in consequence of such default the trustee had made sale of the lands at auction, on the 12th day of December, 1878, at ten o’clock A. M., for $16,300, and thereupon, under the power in the trust deed, conveyed the premises to Smith. The court also found, from the evidence, that no sale of said land was, in fact, made at or on said land by the trustee, on the day mentioned in the notice. The court therefore decreed that the sale be vacated. The decree found due appellant, on the notes and trust deeds, on January 1, 1887, $26,800.21. The decree thereupon orders, that if appellee shall, within one year from the date thereof, pay appellant said sum of money, with interest at six per cent, then appellant shall surrender the land involved, to appellee, and convey to her, but if she fails so to pay, that her bill shall he dismissed. To reverse the decree, the-insurance company appealed, and claims the decree should be reversed on two grounds: First, because the evidence does not sustain the finding that no sale was in fact made on the land, at the time specified in the notice; second, on the ground that complainant was guilty of laches in bringing her bill.

The power of sale in the trust deed provided, that at any time after default in payment of any of the notes thereby ¡secured, it should be lawful for the trustee, on application, in writing, of the legal holder of the notes, or any of them, to sell the land at public auction, for cash, after having published ¡a notice of such sale five times in some newspaper published in Chicago, the last publication to be at least ten days before the day of sale, and “said sale to be made at or on the premises. ” The notice signed by the trustee was dated November 2, 1878, and states that on the 12th day of December, A. D. 1878, at the hour of ten o’clock in the forenoon, at the main door on Polk street, nearest Sherman street, of the building situated on said premises, (describing the premises in question,) in pursuance of the power conferred upon said trustee by said trust deed, said trustee would sell at public auction, to the highest bidder, for cash, the premises by said trust deed conveyed (describing the same.) The deed by the trustee to Smith, the purchaser at the alleged sale, recites that the sale was made on December 12, 1878, at ten o’clock in the forenoon, at and upon the land in question. Bappleye, the trustee, testified, on the hearing, that the sale was made at the time and place designated in the trustee’s deed. The deed of trust under which the sale was made, provides that the recitals which may be contained in the trustee’s deed, “setting forth the fact of due notice, advertisement and sale, and setting forth any and all such other facts as may be proper to evidence the legality of such sale and conveyance, shall be prima facie evidence of the existence of such facts.”

The foregoing is the evidence mainly relied upon by appellant to show that the land was sold at or on the premises at the time specified in the notice, while, on the other hand, Maria Boggs, the complainant, her husband and daughter, who at the time resided upon the premises, all testify positively that they were there at the time the sale was advertised to take place, and no sale was made by the trustee or any one else. James Boggs, the husband, kept a saloon on the premises at the time, and he was on the look-out for the trustee. Maria Boggs, a few days before the time the sale was advertised to take place, had procured a paper containing notice of the sale, and she, too, as she testified, was on the watch 'for the trustee, from a few minutes past nine o’clock in the forenoon until four o’clock in the afternoon. She says that she went up-stairs, where she could have a full view of any one who might approach the premises, and that the trustee did not appear on the day of sale. It is true that the burden of establishing the fact that the sale was not made at the time and place alleged, devolved upon the complainant; and we are willing to concede, as held in Munn v. Burgess, 70 Ill. 604, that the presumption is, that persons charged with a trust perform their duty, until the contrary appears. But here the evidence introduced on behalf of complainant was, in our judgment, ample to remove all presumptions in favor of the acts of the trustee, and, in addition, was sufficient to overcome the evidence introduced by appellant to establish the sale. The trustee testified that the sale was made; that Walker was present and bid off the property for Smith, to whom he conveyed. But Walker is dead, and his evidence is not in the record. The fact in regard to the sale at the time and place, aside from the presumptions arising from the trustee’s deed, and recitals therein, depend entirely upon the evidence of the trustee, and be is contradicted by three witnesses, who had equal means of knowledge with him. The circuit court, on the hearing, thought the weight of the evidence was against the sale, and we are not prepared to say that the judgment was erroneous.

We now come to the second question relied upon by appellant,—the laches of the complainant. As heretofore stated, the pretended sale was made December 12, 1878, and the complainant filed her bill in March, 1884. It does not appear that the rights of innocent purchasers are involved, as the insurance company still holds the title, wdiatever it may be, which passed under the alleged sale of the trustee. Nor does it appear that complainant ever acquiesced in the sale or recognized the title obtained under it. On the other hand, she refused to surrender the possession of the premises, and resisted the action of the insurance company for possession, in the circuit and Appellate courts, until finally defeated, and after possession of the property was finally taken from her, then, without unnecessary delay, this bill was brought. Under such circumstances, we are aware of no rule of equity under which complainant could be barred of relief. If this had been an irregular or defective execution of a power, and, in the meantime, the rights of innocent purchasers had intervened, a different question might arise. But such is not the case. There was no sale whatever under the power contained in the deed of trust, .and when the insurance company obtained possession of the premises, they went in as mortgagees, and held as such, and a bill to redeem might be brought at any time before the Statute of Limitations had run.

Appellee has assigned cross-errors on the record, under which she claims that the court erred in holding that the loans were not usurious, and the court also erred in refusing to decree a sale of the premises for the amount due on the mortgages, with redemption. The two loans appellee obtained from the insurance company drew interest at the rate of ten per cent, payable semi-annually,—the highest rate allowed by the statute at the time the money was loaned. The application for the loans was made by the complainant to Frisby &. Bappleye, a firm in Chicago, engaged in the business of life insurance, loaning money upon real estate, and buying and selling commercial.paper. The application was submitted to the Massachusetts Mutual Life Insurance Company by this. Chicago firm, and the money obtained. ■ Frisby & Bappleye charged complainant a commission of two and one-half percent, which was paid them for procuring the loan. Had this commission been paid to the insurance company, the rate would then have been tw'elve and one-half per cent, and the contract would then have been usurious. But the evidence shows that the company never received the commission, never-authorized commissions to be charged, and had no knowledge that commissions were charged, and received no benefit, directly or indirectly, therefrom. Under such circumstances, we perceive no ground upon which it can be held that the transaction between complainant and the insurance company was usurious. The insurance company made the loans at ten per cent interest, which it had a right to do under the law, and. if the borrower saw proper. to pay a bonus to some outside-party to aid in procuring the money, that is a transaction which does not, in any manner, have any bearing on the contract under which the insurance company loaned the money to complainant.

But we have been furnished with a long argument, in which, it is claimed that Frisby & Bappleye were the agents of the insurance company, and a payment of commissions to them, as agents, was a payment to the company. It may be true, that if Frisby & Bappleye had been the agents of the insurance company in making the loans and receiving the commissions, it might be held responsible for the act of such agents in receiving the commissions. But the evidence fails to show that Frisby & Bappleye were the agents of the insurance company. They were the agents of the company for procuring life insurance, and nothing more.

Bappleye, in answer to a question “whether the insurance company did make a loan or loans of money to Maria Boggs, through you, as its agents, ” said: “No, sir. In explanation of that answer, I will say that the loans which we made for the Massachusetts Mutual Life Insurance Company were made on the same basis that we loaned for everybody else. When we had an application for a loan, we would apply wherever we thought we could best get the money. Sometimes we would apply to the Massachusetts Mutual, and sometimes to other parties. We had no relations to the Massachusetts Mutual Company as loaning agents. Our relations and our contract called for an agency for procuring life insurance, but when we procured loans from them of money, we procured them just the same as we did from anybody else. We had a written contract with the Massachusetts Mutual Life Insurance Company, and that contemplated nothing but insurance. ” It is true, this firm sent the insurance company quite a number of applications, and the company made loans thereon; but there is no evidence in the record which can be construed as proving that Frisby & Bappleye were the agents of the insurance company in making loans of money. The facts here are substantially the same as in Cox v. Massachusetts Mutual Ins. Co. 113 Ill. 382, where we held that the loan was not usurious, and the ruling there must govern here.

As to the other question presented by the cross-errors, that is disposed of adversely to appellee in Decker v. Patten, 120 Ill. 464, and we refer to the opinion in that case for an expression of our views on the question.

The decree of the circuit court will be affirmed.

Decree affirmed.


source: Caselaw Access Project

author: Mr. Justice Scholfield

license: Public Domain

text:
    Rufus E. Holmes v. The Village of Hyde Park.

      Filed at Ottawa May 12, 1887.

    ®PE0IAI‘ assessment—wmii of title in municipality, to the ground sought to he improved for a street, as an objection to confirmation. The owner of property specially assessed for the purpose of grading and paving a street of an incorporated village, can not interpose the objection, to the confirmation of the assessment, that the village has not acquired title to the soil to be graded and paved.
    2. The corporate authorities of cities and villages may levy special assessments for the improvement of a proposed street before acquiring the soil, ky condemnation or otherwise, and afterward take the necessary steps to condemn, and have the compensation and damages to be paid, assessed.
    3. A special assessment for the improvement of a proposed public street before acquiring the soil over which the street is to run, is not in violation of section 13, of article 2, of the constitution, which provides that private property shall not be taken or damaged for public use without just compensation.
    4. Same—when proceeding may be enjoined. It may be, if it were made to appear there was probability that the village would not acquire the title to the street, and so the benefit of any improvement to be made by the aid of the special assessment would be lost to the public, that a court of equity would enjoin the proceeding until the title should be acquired.
    Appeal from the County Court of Cook county; the Hon. Richard • Prendergast, Judge, presiding.
    Mr. J. 8. Huey, for the appellant.
    Mr. Henry V. Freeman, for the appellee.
   Mr. Justice Scholfield

delivered the opinion of the Court:

The question here is, whether the owner of property specially assessed for the purpose of grading and paving a street of an incorporated village, can interpose the objection, on an application to the court to confirm the assessment, that the village has not acquired title to the soil' to be graded and paved as a street.

The question is, in effect, answered in the negative by Village of Hyde Park v. Borden, 94 Ill. 26. The objection was there urged, as here, that the ordinance was void because it required the improvement to be made upon private property, and it was answered: “The statute does not require that the ordinance itself shall, when providing for an improvement, make any provision for acquiring the right to make the improvement upon the property of others; but it provides that after the passage of an ordinance for an improvement the making of which will require that private property be taken or damaged, then the city or village shall file a petition, praying that the just compensation for such taking or damage shall be ascertained by a jury. And the Eminent Domain act, which is to be taken in connection with this statute, provides that such proceedings for the ascertainment of compensation shall be instituted only in case the compensation can riot be agreed upon by the parties interested, or in case the owner of the property is incapable of consenting. * * * We do not understand that because private property can not be taken or damaged for public use without just compensation, this compensation must be ascertained before any assessment can be made for an improvement W'hich may require such taking or damaging.”

This assessment is not for private, but for public use,—for the improvement of a street of the village for public travel,— and so is no violation of section 13, article 2, of our constitution, which provides that “private property shall not be taken or damaged for public use without just compensation.” Whether the compensation shall be made to the owner of the soil for the land taken for the street, before or after the assessment for its improvement, can not make that assessment either larger or smaller; and so, whether title to the soil, entered upon for the purposes of the street, has been heretofore, or remains to be hereafter, acquired, is a distinct question from that of the benefits and damages to result to the adjacent land owner from the improvement of such street, and the latter has no dependence on the former. The owner, or claimant of ownership, of the soil covered by the street, is not, as such, merely required to be made a party to the-assessment proceedings, and, manifestly, could not, therefore, be concluded or materially affected in his rights by the judgment confirming the assessment.

It may be, if it were made to appear that there was probability that the village would not acquire title to the street, and so that the benefit of any improvement to be made by aid of the special assessment would be lost to the public, a bill in chancery would lie to enjoin the assessment proceedings until the title should be acquired; but then, all the claimants to title would be parties, and concluded by the adjudication.

The judgment is affirmed.

Judgment affirmed.


author: i Mr. Justice Sheldon

text:
    William Drury v. Charles C. P. Holden.

      Filed at Ottawa May 12, 1887.

    1. Purchase subject to incumbrances, or under an agreement to discharge incumbrances—merger. Where a party purchases land which is incumbered to secure the payment of indebtedness, and assumes the payment-of the same as a part of the purchase price, the premises purchased will, in-his hands, become primarily liable for such indebtedness, and it will be his-duty to pay it.
    2. And the rule will be the same although there be no formal assumption-, of the indebtedness, if the purchase be made expressly subject to the incumbrance, and the amount of the indebtedness thereby secured is included in and forms a part -of the consideration of the conveyance.
    3. Where a person in exchange of other property takes a warranty deed of lots, subject to a deed of trust thereon, giving in other property the value fixed upon the lots, less the amount of the incumbrance, it will be his duty to discharge such incumbrance, and if he purchases the same in the name of another, a court of equity will treat his purchase as a payment, and apply the doctrine of merger. Such purchase will operate as an extinguishment of the debt secured by the trust deed.
    4. Covenants fob title—how far restricted to the estate actually conveyed—as, in the case of a purchase subject to incumbrances. Where a deed conveys lots subject to an incumbrance thereon, the covenants of warranty of title and against incumbrances will extend only to the estate actually conveyed, which is the equity of redemption.
    5. A deed for lots, after the description, contained this clause, “subject to the following incumbrances on said described premises,” describing them, after which followed full covenants of warranty of title, and that the premises conveyed were free and clear from all incumbrances, containing no exceptions: Held,,that the covenants applied only to the estate conveyed, which was not the lots absolutely, but subject to the incumbrances, and that the real covenant was, that, otherwise than subject to incumbrances named, the lots were free from all incumbrances, and that the grantor would warrant and defend the title.
    6. Pabol evidence—to show the- actual consideration of a deed. The owner of certain parcels of land, holding the title subject to two deeds of trust given thereon by a prior owner, conveyed the same, by warranty deed, for the expressed consideration of $40,000, in exchange for other property, but the deed was made subject to the trust deeds: Held, that parol evidence was competent to show that the lots were taken at $40,000, less the amount of the incumbrances thereon, the grantee paying only the difference in other property.
    Appeal from the Circuit Court of Cook comity; the Hon. Oliver A. Harker, Judge, presiding.
    Mr. J. M. H. Burgett, for the appellant:
    A vendor’s property must be exhausted before recourse can be had to the vendee. If he sells property subject to an incumbrance, his other property is to be first taken. Cooper v. Bigley, 13 Mich. 463; Wadsworth v. Lyon, 93 N. Y. 201; Barnes v. Mott, 64 id. 397; McCloskey v. O'Brien, 16 W. Va. 791; Wolbert v. Lucas, 10 Pa. St. 63; Beddoch v. DeWitt, 43 id. 346 ; Iglehart v. Crane, 42 Ill. 261; Marshall v. Moore, 36 id. 321; Hurd v. Eaton, 28 id. 122; Wise v. Harris, 13 id. 41.

      The merger of an incumbrance, when no intention is mani.fested by the parties, will depend upon the interest of the person acquiring the title. Campbell v. Carter, 14 Ill. 286; Insurance Co. v. Corn, 89 id. 170; Shaver v. Williams, 87 id. 469; McCloskey v. O'Brien, 16 W. Va. 791.
    When a mortgagee acquires title to a part of the mortgaged, premises, if the mortgage ought to be paid wholly out of the part retained by the mortgagor, then it maybe enforced against the same. James v. Morey, 2 Cow. 246; Casey v. Buttolph, 12 Barb. 637; Clifft v. White, 12 N. Y. 519; Smith v. Roberts, 91 id. 470; Wilhelmi v. Leonard, 13 Iowa, 330; Baker v. Flood, 103 Ill. 474; Tucker v. Crowley, 127 Mass. 400.
    Unless there be two estates in the same person in the same land, there is not any estate in that person to merge or occasion a merger. And, generally, where different tracts of land are mortgaged, whether by the same or different mortgages, to secure the same debt, if the mortgagor has sold one tract of the land so mortgaged, and has not. seen fit, in making such sale, to charge such tract with the payment of any part of the incumbrance, the purchaser or his grantee may take an assignment of the mortgage, and enforce its full payment at law by the mortgagor directly, or out of those tracts of the land still owned by him. Of course, the assignment works a release of the lien of the mortgage as to that part of the premises owned by the assignee, for a man can not hold a mortgage on his own property. But there is neither payment nor merger, and, therefore, no extinguishment, even pro tanto, of the mortgage debt. The assignment has the same effect as a release by the holder of a mortgage, of part of the land covered by it. It makes no difference to the mortgagor whether one person or another owns it, and it does not change his relations to the purchaser or the holder of the mortgage. Clifft v. White, 12 N. Y. 519; Smith v. Roberts, 91 id. 470; Barnes v. Mott, 64 id. 397; Skeel v. Sproker, 8 Paige, 182; Casey v. Buttolph, 12 Barb. 637;.Knickerbocker v. Boutwell, 2

      Sandf. Ch. 319; James v. Morey, 12 Cow. 246; Wilhelmi v. Leonard, 13 Iowa, 330; Tucker v. Crowley, 127 Mass. 400; Bruner's Appeal, 7 W. & S. 269; Ziegley v. Long, 2 Watts, 205.
    The maker of the deed to appellant covenants to defend the lots against the holders of all incumbrances. Making the deed subject to them was not to fasten a liability on appellant, or to make his lots primarily liable for the payment of the incumbrances. Lewis v. Day, 53 Iowa, 575; Slater v. Breese, 36 Mich. 77; Foliffe v. Collins, 21 Mo. 338;. Estabrook v. Smith, 6 Gray, 572; Spurr v. Andrews, 6 Allen, 420; Strong v. Converse, 8 id. 557; Tucker v. Crowley, 127 Mass. 400; Jones on Mortgages, secs. 735, 736, 744, 865.
    Messrs. Fay & Griggs, for the appellee:
    When a party purchases premises which are incumbered to secure the payment of indebtedness, and assumes payment of the indebtedness as a part of the purchase money, or if he purchases the premises subject to the incumbrance, and the amount of the indebtedness ¿hereby secured is included in and forms a part of the consideration for the conveyance, the premises purchased are in his hands a primary fund for the payment of the debt, and it is his duty to pay the debt. Henderson v. Bellew, 45 Ill. 325, and cases cited; Lilly v. Palmer, 51 id. 331; Rogers v. Herron, 92 id. 582; Russell v. Pistor, 3 Seld. 171; Halsey v. Reed, 9 Paige, 452.
    When mortgaged premises are sold subject to the mortgage, and the conveyance is made expressly subject to the incumbrance, with full knowledge of the amount of the mortgage debt, and the mortgage debt is included in and forms a part of the consideration of the conveyance, if such purchaser afterward purchases the mortgage, it is thereby paid and discharged, and must be so regarded,-and is not recoverable against the mortgagor. Booker v. Anderson, 35 Ill. 66; Comstock v. Hitt, 37 id. 542; Lilly v. Palmer, 51 id. 331; Fowler
      v. Fay, 62 id. 376; Essley v. Sloan, 116 id. 399; Sands v. Church, 6 N. Y. 347.
    The existence of the debt is essential to the life of the trust deed or mortgage, and whatever extinguishes or bars the debt determines and extinguishes the power of sale in the instrument, and the instrument itself: And in such a case, if a sale has been made, a court of equity may properly exercise jurisdiction to set it aside and remove the cloud. Redmond v. Packenham, 66 Ill. 434; Boyd v. Keighan, 94 id. 543; Wood v. Colvin, 2 Hill, 566; Cameron v. Irwin, 5 id. 272; Kennedy v. Northrup, 15 Ill. 149.
    When the incumbrance forms part of the purchase money, or price to be paid, the property will be primarily liable in the hands of the purchaser. Fowler v. Fay, 62 Ill. 367; Halsey v. Reed, 9 Paige, 431; Comstock v. Hitt, 37 Ill. 444; Essley v. Sloan, 116 id. 399.
    In his purchase appellant retained in his hands $26,100, as a fund to pay off the incumbrances. Having received the benefit of the incumbrances by deducting this amount from the price he agreed to pay, he ought to pay them. Essley v. Sloan, 116 111. 399.
    The payment of the debt, or the purchase of it by Drury, or by Eoff, as his agent, or with his money, operated to pay, discharge and extinguish the debt. Lilly v. Palmer, 51 Ill. 331.
    If there is no debt there can be no valid sale, but the power of sale and the trust deed having, by the extinguishment of the debt, become determined and extinguished, the sale was void. Redmond v. Packenham, 66 Ill. 437; Insurance Co. v. Jackson, 83 id. 302.
   i Mr. Justice Sheldon

delivered the opinion of the Court:

This is an appeal by Drury, defendant in the court ■ below, from a decree setting aside a sale and deed to him of certain premises in Charles N. Holden’s subdivision in Chicago, known in the record as the “barn lot, ” made under the power in a trust deed given by appellee, Charles C. P. Holden, to secure the payment of his note for $6500, to one Kelly.

The record shows that on April 23, 1869, Holden executed to Sanford B. Perry, as trustee, a deed of trust on lots 1, 2, 3, 4, 5 and 6, in C. C. P. Holden’s re-subdivision, etc., to •secure an indebtedness owing from him to the Jonathan Bevor ■estate, for the sum of $19,600. September 20, 1871, he executed to said Perry, as trustee, another trust deed upon the ■same premises, except lot 6, to secure the payment of his note to Edward A. Kelly, for the sum of $6500. By an ■agreement between the parties, Perry released from the last mentioned trust deed said lot 1, and at the same time, January 31,1873, in the place of the security so released, Holden ■executed to Perry a trust deed on the “barn lot,” so called, to secure the same note of September 20, 1871, for $6500. November 16, 1874, Holden conveyed said lots 2, 3, 4 and 5, ■to William H. Holden, who conveyed to Warren, he to Elliott, and the latter to Isaac M. Daggett, who, on April 12, 1876, conveyed the same to Drury, the appellant. This deed to Drury purported, for and in consideration of the sum of $40,000 in hand paid by the said party of the second part, (Drury,) to grant bargain, sell and convey unto Drury said lots 2, 3, 4 and 5. Immediately after the description of the lots conveyed, the deed contained the following clause: “Subject to the following incumbrances on said described premises: one for the principal sum of $19,600, and the other for the principal sum of $6500. The first of said incumbrances is dated April 23, 1869, and the second (the one for $6500) is dated September 21, 1871.” Following thereafter, the deed contained full covenants of warranty of title, and that the premises conveyed were free and clear from all incumbrances, there being no exceptions whatever to the covenants.

Daggett, the grantor, testified that he made the deed, with deeds of three other pieces of property, in exchange for property owned by Drury; that in the exchange, said lots 2, 3, • 4 and 5 were estimated as worth $40,000; that the equity of redemption was traded for, and its value was computed as being the difference between $40,000 and the amount of the incumbrances; to make the amount of consideration named in the deed, the amount of the incumbrances was included with the value of the equity; that Drury knew the- property was incumbered, as the deed shows he took it from him subject to incumbrances; that he, Daggett, bought this property subject to iucumbrances, but did not assume any, and he put it off on Drury just as he got it; that there was no agreement by Drury to pay the incumbrance,—nothing said about-his paying them; that he took it subject to incumbrances; that the incumbrance formed part of that $40,000; that he-singly agreed to take this property mentioned in the deed, on the basis of $40,000, in making up the trade.

It was admitted, that in April, 1879, one Eoff purchased the $6500 note with money furnished him by Drury therefor. September 23, 1879, Perry, the trustee, after advertising the-barn lot for sale, under "the trust deed of January 31, 1873, made a sale of the same to Drury, for the sum of $1000". The net amount from the sale ($945) was indorsed on the note, and Perry, as such trustee, made a deed of the lot to- ■ Drury, pursuant to the sale. The court below found that the premises, at the time of the sale, were freed and discharged of all indebtedness secured by the trust deed; that the sale and trustee’^ deed were void, ■ and by its- decree set them aside, f

It is insisted by appellant, that the effect of the decree in this case is to decide that where two tracts of land are mortgaged, by separate mortgages, to secure the same debt, and one tract is afterwards conveyed away by the mortgagor, a remote grantee of the equity of redemption of the tract so-conveyed away is bound to pay the entire mortgage debt, to-■the relief of the other tract, even though his grantor was. under no obligation to pay such debt, and he has entered into no engagement to pay it; that the decree is in direct violation of the rule requiring mortgaged lands to be sold for the payment of the mortgage debt in the inverse order of their alienation by the mortgagor. This statement overlooks the fact that the conveyance of the lots to Drury was made expressly subject to the incumbrance. Admitting the general rule to be as stated by appellant, the inquiry arises as to the effect of this latter fact in modifying the rule.

¡ It is well established, that when a party purchases premises W'hich are incumbered, to secure the payment of indebtedness, and assumes the payment of the indebtedness as a part of the purchase money, the qiremises purchased are in his hands a primary fund for the payment of the debt, and it is his duty to pay it.- (Lilly v. Palmer, 51 Ill. 331; Russell v. Pistor, 8 Seld. 171.) And the rule is the same, although there be no assumption of payment of the indebtedness, if the purchase be made expressly subject to the incumbrance, and the amount of the indebtedness thereby secured is included in and forms a part of the consideration of the conveyance. Lilly v. Palmer, supra; Comstock v. Hitt, 37 Ill. 542; Fowler v. Fay, 62 id. 375; Russell v. Pistor, supra; Ferris v. Crawford, 2 Denio, 598.

It is said the deed from Daggett to Drury contained full covenants of warranty, to which there was no exception; that thereby Drury’s grantor covenanted that he would warrant and defend the lots conveyed, against the holders of all incumbrances. The covenants extended only to what was conveyed, and that was not the lots absolutely, but the lots subject to the incumbrance. The real covenant was, that otherwise than as subject to the incumbrances named, the lots were free from all incumbrances, and that the grantor would warrant and defend the title.

It is said, also, that there was not, here, a cash sale of the lots to Drury, but an exchange of property, and that the case is not one where the entire interest in property was purchased at .a fixed price, and then the purchaser was allowed to retain in his hands, for the payment of an incumbrance, an amount of the purchase price equal to the amount of the incumbrance; but it is, as we view it, as shown by Daggett’s evidence, just such a case, with the exception of its being property instead of money, which was thus held and retained in Drury’s hands. We understand, from Daggett’s testimony, that the lots conveyed to Drury were of the value, unincumbered, of $40,000; that it was the equity of redemption that Drury traded for, and its value was computed in the exchange as being the difference between $40,000 and the amount of the incumbrances. In thus obtaining the lots, Drury had and retained, in his property, the exact amount of the incumbrances ($26,100) as a fund for the payment thereof, in effect. We deem it immaterial whether the purchase was for cash or by exchange of property.

It is objected that oral evidence was inadmissible to show that the amount of the incumbrances was deducted-from the amount of the purchase price, and allowed to Drury. The evidence being in regard to what constituted the consideration of the deed to Drury, and that the amount of the incumbrances was included in and formed a part of the consideration, was clearly competent, under the rule which permits parol evidence upon such subject of the consideration of a deed.

If, then, the mortgagor himself had made this deed to Drury, we are satisfied that, under the rules and authorities above referred to, the lots conveyed to Drury would be the primary fund for the payment of this mortgage or trust deed in question. Does it differ the case that the deed was made by a grantee from the mortgagor, of the equity of redemption, and such grantee not being personally liable for the mortgage debt? It is insisted that it does—that appellee, the mortgagor, was a stranger to Daggett, who conveyed to Drury, the appellant, as well as he was to Drury, and would have no right to have such lots conveyed to Drury applied to the payment of the mortgagor’s debt. The deed to Drury was made expressly subject to the incumbrances. It appears that the mortgage debt was included in and formed a part of the consideration of the conveyance. It was seen by both parties that Drury would have the mortgage to pay. It was •expected that he would pay it, and Drury, in effect, retained from the purchase price the amount of the incumbrance, to pay it. If, then, Drury should afterwards pay the mortgage •debt, it would be but just that he should do so; it would be in accordance with the arrangement between him and Daggett ; it would, in truth, be but the payment of part of the purchase price of the lots. That price he ought to pay. There was, in effect, property retained in his hands to pay the mortgage debt, and it would seem inequitable for him to appropriate it to his own use, and not apply it, as contemplated, to the mortgage debt. That in paying the mortgage debt -there comes an incidental benefit to the mortgagor, in the discharge of his debt, is a benefit which he equitably may enjoy.

In an equitable aspect, we think, in the effect, it should be regarded no differently than if the mortgagor, instead of Daggett, had made the deed to Drury. This conclusion, making the lots in Drury’s hands conveyed to him by Daggett a primary fund for the payment of the mortgage debt, renders Drury’s purchase of the mortgage note to be equivalent to the payment of it; and may, too, well enough present a case for the application of the doctrine of a merger where the equity of redemption and the mortgage meet in the same person.

We think the decree of the circuit court should be affirmed. /

Decree affirmed.


text:
    William E. Witherwax v. David Riddle.

      Filed at Ottawa May 12, 1887.

      1. Fraud—in an exchange of lands—inadequacy of price, or inequality of value, as an element. While mere inadequacy of price is not, per se, a ground for setting aside a transfer of property, yet it may be so gross and palpable as to amount, in itself, to proof of fraud; and this, in connection with proof of imposition and misrepresentation on the part of the purchaser and his agents, will be sufficient, in a court of equity, to characterize the transaction as fraudulent.
    2. In this case, which was upon bill to set aside a contract of exchange of lands, on the ground of fraud, the party complainant, owning one hundred and twenty acres of land, worth $2700 above an incumbrance thereon, and a lot worth $200, ivas induced by the defendant to give the same, and $100 in money and his note for $412, for three hundred and twenty acres of land owned by the defendant in Wisconsin, which was worthless. The defendant represented to him that the Wisconsin land was good land, worth $10 per acre, though he said he had never seen it. The complainant, being desirous of avoiding expense of going to see the defendant’s land, asked him if he could not refer him to some reliable person for information. The defendant referred him to one Lowe, who said he knew the land in the vicinity, and that if the land was improved it was worth $25 per acre, but if unimproved, it was worth $8 or $10 per acre. This proving unsatisfactory, the defendant introduced complainant to one D., who was a man of bad repute and a fugitive from justice, and who represented that he had been on the land; that it was as good as any land in this State, and that the grass-grew on it higher than his head. After the trade was completed, defendant advised the complainant to go and see the land, but he, being' satisfied with the assurances of the defendant and the two persons named, executed the contract, and conveyed his land and lot for the Wisconsin land: Held, that the complainant was entitled to have the contract of exchange set aside, on the ground of fraud.
    3. ■ Same—when party responsible for representations of others. Where a party negotiating for the sale or exchange of worthless land in another State, introduces to the other party a fugitive from justice for information concerning his land, whom he represents as acquainted with the property and as a reliable man, who makes false representations concerning the quality and value of such land, he will be responsible for such false statements.
    4. In such case, the assurance that the person introduced was a man possessing the information desired, respecting the land, and holding him out as a reliable man, knowing the contrary, for the propose of imposing upon the purchaser by a falsehood, is a fraud of itself, and the vendor will not be allowed, in a court of equity, to profit by a sale or exchange thus effected.
    5. Same—negligence of party defrauded. Where the owner of worthless land, by his own false representations of the quality and value of the same, and those of others, which he procures to be made, induces another to rely upon the same as true, and to purchase the land, the vendor will not be allowed to defeat a bill to rescind the sale by the failure of the purchaser to examine the land, although he may advise him to go and see the same at the time the deed is being drawn.
    Appeal from the Superior Court of Cook county; the Hon. Hemet M. Shepabd, Judge, presiding.
    Mr. Thomas J. Suthebland, for the appellant:
    The decree was not authorized by the allegations of the bill or by the evidence. The burden was on complainant, and the facts should have been clearly and positively averred, and the bill (pleading) must be taken most strongly against the complainant (pleader.) Klein v. Horine, 47 Ill. 430; Primmer v. Patten, 32 id. 528; Happy v. Morton, 33 id. 398.
    bio decree against appellant could therefore be based upon this bill, notwithstanding what the evidence might disclose, nor should any injunction have been granted against appellant. Pettillon v. Hippie, 90 Ill. 424; Jackson v. Miner, 101 id. 550; Life Ins. Co. v. Slee, 110 id. 36; Kidder v. Vandersloot, 114 id. 133; Parker v. Shannon, id. 192; Walker v. Ray, 111 id. 315; Smith v. Brittenham, 98 id. 199; Pinneo v. Goodspeed, 104 id. 184; Johnston v. Worthington, 8 Bradw. 322.
    The bill does not state a case on which any relief could be granted, and the evidence is insufficient to sustain an allegation of fraud against appellant. Schramm v. O'Connor, 98 Ill. 543; Noetling v. Wright, 72 id. 390; Tone v. Wilson, 81 id. 529 ; Merwin v. Arbuckle, 81 id. 501; Roper v. Sangamon Lodge, 91 id. 520; Ladd v. Pigott, 114 id. 651; Covert v. Nolan, 10 Bradw. 629; Dillman v. Nadlehoffer, 19 id. 380.

      Mr. Charles H. Roberts, for the appellee:
    While inadequacy of price will not, of itself alone, be ground! of avoiding a contract, yet when there are other ingredients in the case, of a suspicious nature, or a peculiar relation existing between the parties, gross inadequacy of price will furnish the most vehement presumption of fraud. Reed v. Peterson, 91 Ill. 288; 3 Wait’s Actions and Defences, 445.
    When a vender employs another to make representations, it is the same as if they were made by him. Ranger y. Railway Co. 5 H. L. Cases, 86.
    Even if appellant did not know the value of the Wisconsin land, this is no defence. It is not necessary that he knew the representations to be false, if they were material, and the other party had a right to and did rely on them. Allen v. Hart, 72 Ill. 104; Mitchell v. McDonald, 62 id. 498; West v. Wright, 98 Ind. 335.
    The bill is not defective, but if it was, a defective pleading is aided by verdict. Ladd v. Pigott, 114 Ill. 652.
    Witherwax, even if originally innocent, in refusing to re-convey, adopted the fraud of the agent.-
    Where the principal attempts to reap advantage from the-fraud of the agent, the principal will be bound by the fraud, and relief given. 1 Perry on Trusts, (3d ed.) p. 201, sec. 172; Cornfoot v. Fouke, 6 M. & W. 381.
    Distinction as to proof between actions on case for deceit- and bills for rescission, is given in Udell v. Atherton, 7 H. & N. 30, L. J. Ex. 337, and commented on in Benjamin on. Sales, (3d Am. ed.) sec. 463. Proof of knowledge on the part-of the principal is required in the latter, only.
   Mr. Justice Craig

delivered the opinion of the Court:

This was a bill in equity,,brought by David Riddle, against-William D. Witherwax, to rescind jy trade in real estate, wherein the complainanFexehanged a farm, consisting of one hundred and twenty acres of land in Whiteside county, and a lot in Sterling, for three hundred and twenty acres o'f land in Adams county, Wisconsin. The bill charged fraud, on the part of defendant, in the description of the character, quality and value of the Wisconsin land, and upon this ground, mainly, a rescissipn of the trade was prayed for by the complainant. The defendant put in an answer to the bill, in which the allegations of fraud were denied. A replication was filed to the answer, and the cause proceeded to a hearing, on the pleadings and evidence, which resulted in a decree in favor of the complainant. The defendant appealed.

The first ground of error relied upon to reverse the decree is, that the decree was not authorized by the allegations of the bill. We shall not stop to set out the various allegations of the bill, but upon an examination of the different averments, as shown by the record, we regard them sufficient to authorize the decree. The representations constituting the fraud are detailed and fully set out, together with the, scienter, and intent on the part of the defendant to deceive and defraud complainant, and we are aware of no rule which requires a more specific statement than is to be found in the bill.

The main ground, however, relied upon to reverse the decree is, that it is not sustained by the evidence contained in the record. It appears, from the evidence, that the complainant owned a farm of one hundred and twenty acres of land in Whiteside county, encumbered by a mortgage of $1600. The farm was worth, over and above the mortgage, $2700. He also owned a lot in Sterling worth $200. The farm and lot were given to the defendant in exchange for three hundred and twenty acres of land in Adams county, Wisconsin, and the complainant paid, in addition, cash $100, and gave his note and a mortgage on the Wisconsin land for $412. At the time of the trade, September 9, 1885, both of the parties resided in Chicago, but they had formerly resided in Whiteside county, and the defendant was well acquainted with the complainant’s property, while the complainant had no knowledge whatever of the quality or value of "the Wisconsin land. The’defendant estimated his land to be worth $10 per acre, although he represented that he had never seen it, but claimed that it was good farming land. The complainant was anxious to avoid the expense of going to see the land, and inquired of defendant if he could not refer him to some good, reliable man, who could inform him in regard to it. Defendant thought he could, and in a subsequent conversation he informed complainant that he had found a man who could tell him all about the property. A short time after this interview the defendant accompanied the complainant to the Afton House, in Chicago, and introduced him to a Mr. Lowe, who could furnish the desired information. Mr. Lowe referred to a map, and said “he knew most every bit of land around there, but could not just locate Witherwax’s land. ” He, however, informed complainant that they grew corn, rye and big clover where the land was located, and that defendant’s land, if improved, was worth $25 per acre; that unimproved land was worth from $S to $10 per acre. The statement of Lowe did not prove quite satisfactory, and a short time after this interview the defendant brought a Mr. Duffield, and introduced him to complainant as residing at Bock Falls, and stated that he could inform complainant all about the land. Duffield informed complainant that he had been on the land, and that it was as good as could be found in this State,— better than any land in Whiteside county; that the grass grew so tall and rank on the land, that he “stood up and pulled the grass over his head. ” These statements proving to be satisfactory, the trade was concluded. The representations, however, in regard to the land, proved to be„utterly false. The land in Wisconsin, upon investigation, turned out to be worthless. The witnesses who reside in the locality, and who knew the land, testify that it is a hilly, rough, barren piece of sandy land, with some scrub timber on it. Some of the witnesses testify that it is worth nothing, while others put the value at from seventy-five cents to $1.25 per acre. Duffielcl, whom defendant introduced to the complainant as a suitable person to give complainant information in regard to the land, turned out to be a worthless character, and a fugitive from justice.

These are, in the main, the leading facts which led to the exchange of lands between the parties, and we have no hesitation in holding, with the trial court, that the trade was brought about by fraudulent means. That the complainant’s farm was worth $2700, and the lot in Sterling $200, is not disputed, nor did the defendant undertake to contradict the evidence of complainant, Avliich established the fact that the Wisconsin land ivas Avorthless. The record therefore discloses that complainant turned over to the defendant over $3000 for property Avliich is Avorthless.

Mere inadequacy of price is not, per se, ground for setting aside a transfer of property, yet it may be so gross and palpablé as to amount, in itself, to proof of fraud, and this, in connection Avith proof of imposition and misrepresentation on the part of the purchaser and his agents, will be sufficient to characterize the transaction as fraudulent, in a court of equity. (Reed v. Peterson, 91 Ill. 289.) Here is a gross disproportion betAveen the properties of the íavo parties, and false representations in reference to the quality and value of the Wisconsin land, Avliich are sufficient .to bring the case Avithin the rule indicated in Reed v. Peterson. It may be said that "the defendant made no representations in regard to the quality of the Wisconsin land, and hence is not chargeable with fraud in the transaction. We think that the defendant is so connected with the statements 'and declarations of Loavs and Duffield, made to complainant in regard to the land, that he is bound by those statements. The defendant admits, in his answer, that he told complainant that he knew two parties, one of whom Avas Duffield, that could inform him in regard to the land, and that he put the complainant in communication with them, and the evidence clearly shows that the defendant took these two parties to the complainant, and held them out to him as men who could give him the desired information in regard to the land. Under such circumstances he ought to be held responsible for what they said in reference to the land. The defendant had no right to introduce Duffield to complainant, and hold him out as reliable, and one possessing the information in regard to the land, unless he expected to be bound by what he said. If Duffield was a fugitive from justice,—a man of bad repute,—it was a fraud of itself for the defendant to impose him on complainant as a reliable man, when he knew otherwise. The very object of taking Duffield to complainant was to impose upon him by falsehood. A party ought not to profit, in a court of equity, by a practice of this character.

But it is said that complainant had ample opportunity to go and examine the lands after the trade was concluded, before deeds were exchanged, while abstracts were being prepared, and that defendant expressed a desire that complainant should do so when the deeds were being prepared, and that complainant said he was satisfied. There is the evidence of the scrivener who prepared the deeds, on this subject; but we do not regard anything that was then said or done, of a character sufficient in importance to defeat the complainant of a recovery. He had been led to believe by the defendant that the information he had received in regard to the land was reliable. Nothing had then occurred to excite his suspicion, or that of a prudent man, and the fact that defendant may then have advised that the land should be seen, after he had convinced complainant of its good qualities without seeing it, is of but little importance.

In conclusion, we think the evidence fully sustains the decree of the Superior Court, and it will be affirmed.

Decree affirmed.


author: Mr. Justice Mulkey

text:
    Samuel Frazer et al. v. The Frazer Lubricator Company.

      Filed at Ottawa May 12, 1887.

    1. Trade-mark—consisting of one’s own name—and as the subject of sale and transfer, and the rights acquired thereby. While it is true, as a general proposition, that one can not, by using his own name as a trade mark, deprive another having the same name from using it in conducting his own business, yet the latter can not, under cover of using his own name, be permitted to resort to any device or artifice by which the public will be led to purchase his goods or manufactured articles, under the belief that they are those of the former.
    2. A party has the right to use his own name in conducting his business, either by himself or in connection with others, if done in a proper and legitimate way; and this right is a valuable one, especially when he is the discoverer of a valuable article of trade then being manufactured, and sold on the market. This right, like most other property rights, is the subject of sale and transfer.
    3. Where a party sells out an established business, and with it his own name, to be used in connection with such business, his vendees Will acquire a right to the use of the name, and he can not afterward resume it in carrying on the same business.
    4. This is on the old principle that a title based on a sale for a valuable consideration, under a contract fairly entered into between parties sui juris, will be upheld and enforced, in equity as well as at law. After the sale of the right to use a party’s name in the manufacture and sale of an article, a court of equity will enjoin him from resuming its use in the same business.
    5. The patentee of a rosin oil used in manufacturing the inventor’s axle grease, known as “Frazer’s Axle Grease,” sold all his interest under his patent, and conferred on his grantees and their “successors,” the right to use his name, “so far as it might be necessary to use it, as a trade-mark, or as indicating the material or product which had theretofore been manufactured under said letters patent, and generally known and called, ‘Frazer’s Axle Grease,”’ etc. The contract further provided, that the vendor “confers the authority to use his name, as aforesaid,” upon the grantees, etc., “exclusively, ” and bound the vendor not to confer such authority upon any one else: Held, that the vendor thereby bound himself not thereafter to use his own name, or suffer it to be used by others, in the manufacture of grease, or any other product in which the rosin oil was an ingredient.

      Appeal from the Appellate Court for the First District;— •heard in that court on appeal from the Superior Court of Oook county; the Hon. Henry M. Shepard, Judge, presiding.
    Messrs. D. & T. J. Sheean & McHugh, for the appellant:
    The proof shows that the two greases are positively different, and therefore the court erred in holding they were substantially the same.
    There is no trade-mark in the use of a name. Cooley on Torts, 362; Browne on Trade-marks, secs. 197, 296, 350; Meneely v. Meneely, 62 N. Y. 427.
    The use of a personal name in a fair, honest and ordinary business can not be prevented, even if damage results therefrom. Croft v. Day, 7 Beav. 84; Holloway v. Holloway, 13 id. 213; Gilman v. Hunnewell, 122 Mass. 129; McLean v. Fleming, 96 U. S. 252; Faber v. Faber, 49 Barb. 357.
    The name of a man may lose personality, and ■ become a mere indicator of a quality. Browne on Trade-marks, sees. 178, 181; 47 Am. Dec. 294.
    There can be no exclusive right in the use of a name which is the proper descriptive appellation of an article. Phalon v. Wright, Am. Trade-mark Cases, 307; Caswell v. Davis, 58 N. Y. 233; Candee v. Deere, 54 Ill. 465.
    A complainant must not sell his manufactures as those of another, even if he purchased from the other the right to use his name. Browne on Trade-marks, secs. 474, 361, 478, 71.
    A trade-mark may be assigned, but if the mark be so personal in its character that it is identified with the person, and imports that the goods bearing it are manufactured by him, then the rule would be different, for the law will not lend itself to the perpetration of a fraud. Browne on Trade-marks, sec. 437.
    A trade-mark is transferable with the transfer of the manufactory or business. (Browne on Trade-marks, sec. 360.) But if it indicates the product of a certain person, the law will not permit it to be used for falsehood in applying it under an assignment to another’s goods. Ibid..sec. 361.
    Any agreement in general restraint of trade is illegal and void. Craft v. McConoughy, 79 Ill. 346; Navigation Co. v. Winser, 20 Wall. 68; Keeler v. Taylor, 53 Pa. St. 467; Curtis v. Cohey, 68 N. Y. 300.
    Even contracts limited to the State, or a great part of the country, are held void. Wright v. Bydar, 36 Cal. 342; Moore v. Bonnet, 40 id. 251; Nobles v. Bates, 7 Cow. 307; Chappel v. Brockway, 21 Wend. 157; Morris v. Coleman, 18 Ves. 436; Hind v. Gray, 1 M. & G. 195; Taylor v. Blanchard, 13 Allen, 370; Lawrence v. Kidder, 10 Barb. 641; Price v. Green, 16 M. & W. 346.
    • Messrs. McClellan & Cummins, Mr. M. W. Fullee, and Mr. L. L. Bond, for the appellee:
    It is admitted that the two greases are composed of the same ingredients,—rosin oil, lime, sal-soda, palm oil and water. There is no substantial or perceptible difference in the proportions in which they are contained, or in their appearance or effect.
    A party can not be permitted to sell a patent or a trademark, and then dispute its validity. Curran v. Burdsall, 20 Fed. Rep. 835; Walton v. Laveter, 8 C. B. 162; Chambers v. Chrichley, 23 Beav. 374; Kidd v. Johnson, 100 U. S. 617.
    A trade-mark can not be sold in gross, and be applied to the goods of a stranger. (Manhattan Co. v. Wood, 108 U. S. 219.) But the successors to the same business may acquire the mark. (Pepper v. Labrot, 8 Fed. Rep. 29; Kidd v. Johnson, 100 U. S. 617.) And this, without mentioning the trade- • mark separately. Shipwright v. Clements, 19 W. R. 599 ; McLean v. Fleming, 96 U. S. 245.
    Ordinarily there can be no exclusive right to the proper name of an individual, as against another of the- same name. Meneely v. Meneely, Cox’s Manual, 472.

      A man can not employ his own name even, in such wise as to fraudulently divert the trade of another, of like name, already established in the business. Shaver v. Shaver, 54 Iowa, 208; Landreth v. Landreth, 22 Fed. Rep. 41; Croft v. Day, Cox’s Manual, 76.
    It is of no consequence to complainant’s title whether the individual whose name is identified with the product, is still connected with the business or not. (Rogers Co. v. Rogers Co. 11 Fed. Rep. 495; Dixon Co. v. Guggenheim, 2 Brewst. 321; Thorley Co. v. Massam, Cox’s Manual, 668.) But if that individual withdrew from the business, after giving his name thereto and seeing it applied to the product of the company, he can not resume his name at will, in a like business. His conduct works an estoppel. Holmes v. Holmes, Cox’s Manual, 340.
    If a party bargains away his name by contract, he can not resume it in the business with which it has become identified. The purchase vests title in the assignee. Witt v. Corcoran, Cox’s Manual, 423; Churton v. Douglass, id. 172; Stonebraker v. Stonebraker, id. 333; Gillis v. Hall, id. 335; Grow v. Seeliman, 47 Mich. 607.
    A transfer and succession of business of making an article, carries with it its trade-marks, by implication. Shipwright v. Clements, 19 W. R. 599; Spring Co. v. Spring Co. 45 N. Y. 291; Witthaus v. Braun, 44 Md. 303; Kidd v. Johnson, 100 U. S. 617.
    ■ The law presumes, when one intentionally uses or closely imitates another’s trade-marks, merchandise or manufactures, that he does it for the fraudulent purpose of inducing the public, or those dealing in the article, to believe that the goods are- those made or sold by the latter, and of supplanting him in the good will of his trade or business. Taylor v. Carpenter, 11 Paige, 292.
    • The rule is, that the court will enjoin any imitation calculated to deceive ordinary purchasers. Crawshay v. Thomp

      son, 4 M. & G. 385; Davis v. Kendall, 2 R. I. 556; Holmes v. Holmes, 37 Conn. 278; Witherspoon v. Currie, 22 L. T. R. (N. S.) 260; Hookman v. Pottage, 26 id. 755.
    To be enjoinable it is not necessary that the imitation should be complete. The imitation may be limited and partial, and still be enjoinable. Lockwood v. Boswick, 2 Daly, (N. Y.) 521; Franks v. Weaver, 10 Beav. 297; Shrimpton v. Laight, 18 id. 164; Coffeen v. Brinton, 4 McLean, 516; Clark v. Clark, 25 Barb. 76; White Lead Co. v. Masury, id. 416; Hostetter v. Vowinkle, 1 Dill. 329.
    To be enjoinable it is not requisite that the imitation should be intentionally deceptive. Millington v. Fox, 3 M. & C. 338; Dale v. Smithson, 12 Abb. Pr. 000.
    It is no defence that the imitator informs purchasers of the imitation. It is no answer for the defendants to say that they sold the bitters as theirs. Coats v. Holbrook, 2 Sandf. Ch. 586; Chappel v. Davidson, 2 K. & J. 123.
   Mr. Justice Mulkey

delivered the opinion of the Court:

The appellee, on the 30th day of August, 1884, exhibited its bill in the Superior Court of Cook county, against the appellants, to enjoin the latter from using the name of “Frazer,” “Samuel Frazer,” “S. Frazer” or “S. Frazer & Co.,” or the tame “Frazer, ” “in any way, in the manufacture of axle grease, according to the process • and of the ingredients used by the appellee in the manufacture of Frazer’s Axle Grease, or of axle grease of any kind whatsoever, ” etc. The court, upon the hearing, rendered a decree in substantial conformity with the prayer of the bill, and the defendants appealed to the Appellate Court for the First District, where the decree was affirmed. By the present appeal the record of the proceedings in the lower courts is brought here for review.

In 1856, or thereabouts, appellant, Samuel Frazer, com- < menced, at Galena, Illinois, the manufacture and sale of an axle grease, known and designated in the trade as “Frazer’s Axle Grease.” It was also called “Frazer’s Grease,” and “Frazer’s Lubricator.” The process of manufacturing this grease is Frazer’s own discovery. The product of the discovery is obtained by combining rosin oil, lime, sal-soda, palm oil and water, in certain proportions. The rosin oil used for this purpose is produced by the distinctive distillation of rosin, also a discovery of Frazer’s, for which he received a patent in 1860. In 1868, with a view of changing the location of his business from Galena to Chicago, he formed a co-partnership with George B. Swift, Edward Hunter and Otis S. Favor, under the firm name of Frazer, Swift & Co., which was subsequently changed to that of the “Frazer Lubricator Company.” In February, 1870, John A. Packard became a member of the firm, and Frazer retired from it. The terms and conditions upon which this change in the partnership was effected, are fully shown by the following written agreement, which was duly signed and sealed by all the parties thereto:

“This agreement, made and entered into the 7th day of February, A. D. 1870, by and between Samuel Frazer, of Galena, Illinois, (now temporarily .residing in Chicago, in said State,) party of the-first part, and Edward Hunter, John A. Packard, Otis S. Favor and George B. Swift, of said Chicago, parties of the second part:

“Witnesseth: That for a valuable consideration, and the . further consideration of ten dollars to the party of the first part paid by the party of the second part, the receipt whereof is hereby confessed and acknowledged, the party of the first part hereby sells, assigns, transfers and conveys unto the said parties of the second part all his right, title and interest in and unto certain letters patent, (and the invention thereby secured,) which were issued to the party of the first part by the United States of America, on the 12th day of June, in the year of our Lord one thousand eight hundred and sixty, bearing thereon the number of said patent, to-wit, No. 28,663, said letters patent embracing and covering, in general terms, ‘a new and useful improvement in distillation of oils from rosin,’ said invention being particularly described in the schedule and diagram attached to said letters patent, and of record in the patent office in the city of Washington, in the District of Columbia. The party of the first part, for the consideration aforesaid, hereby authorizes the parties of the second part, their assigns, successors, heirs, administrators, executors or legal representatives, to use his name, so far as it may be necessary to use it, as a trade-mark, or as indicating the material or product which has heretofore been manufactured under said letters patent, and generally known and called ‘Frazer’s Axle Grease,’ ‘Frazer’s Lubricator,’ or ‘Frazer’s Grease,’ and confers the authority to use his name, as aforesaid, upon the parties of the second part, their assigns, successors, etc., exclusively, and binds himself to confer that authority upon no other person or persons, corporation or association whatsoever; and he hereby sells, assigns and transfers, for the same aforesaid consideration, unto the said •parties of the second part, their assigns, successors and legal representatives, all interest, right and title which he may have in any renewals or extensions of said letters after the expiration thereof, and hereby expressly agrees and binds himself unto the said parties of the second part, their assigns, successors or legal representatives, to make in his own name, but for the benefit of said parties of the second part, all or any applications, petitions or requests in wu-iting, or otherwise, which may be required by said parties of the second part for the purpose of obtaining any renewal, extension or re-issuance of said letters patent, and without charge therefor, provided said parties of the second part assume and pay all costs and expenses attendant thereupon; and said party of the first part agrees and binds himself not to engage hereafter in the manufacture, directly or indirectly, of the product or material secured by said letters patent and known as aforesaid, and not to use, or authorize the use of, his name as a trade-mark, or otherwise, for the manufacture of said lubricator, axle grease or grease, or any other product made under said letters patent. The parties of the second part hereby agree to hold said party of the first part harmless against all or any costs or liabilities arising from the use of his name, as aforesaid.”

Frazer received for his interest in the business and assets of the concern, and the rights secured under the above agreement, in property and money, altogether, $17,500, most, if not all, of which was paid by Packard, who took his place in the firm. On the 29th of April following, the members then composing the firm of the Frazer Lubricator Company, became incorporated under the same name, and the corporation thus formed, being the present appellee, succeeded to all the rights, property and ■ assets of the concern. Since that time the same business has been successfully carried on, and so extended by the company until it has become one of vast proportions, and highly remunerative to the stockholders. At the time of ' Frazer’s withdrawal from the business, the process of making the axle grease was known only to himself and one or two others, and even now it appears to be known to but few.

In 1879, Frazer obtained a patent from the government for what he claimed to be an improvement in the manufacture of the axle grease, in which patent reference is made to the patent of 1860. In the following year he applied for and obtained a second patent for another discovery and improvement upon the process of making said axle grease. Armed with these additional patents,—or, rather, the last one, as he claims the first was issued by mistake,—he, in 1884, in connection with others, under the name of “S. Frazer & Co.,” commenced again, at Galena, the manufacture of axle grease, which was put up and sold in packages marked “ Superior Axle Grease. ” Below this brand or mark was the name of the firm, “S. Frazer & Co.,” in good-sized capitals. While these packages differed, in a number of particulars, from those put up by appellee, yet in other respects, it must be admitted, there was a striking resemblance between them, which, when taken together with the name “Frazer, ” was well calculated to mislead dealers not knowing there was more than one company engaged in the same kind of business, or not familiar with the marks by which the packages of the two ■establishments were distinguishable. Appellee regarding the business of appellants, in the manner carried on by them, as an invasion of its rights, filed the present bill, for the purpose and with the result already stated.

Able and elaborate arguments, presenting the respective contentions of the parties, have been filed in the case, which exhaustively treat of every question of law or fact presented by the record that has either a direct or remote bearing upon the merits of the controversy ' In addition to this, there have been filed, with the briefs of counsel, written opinions in the case, in the Superior as well as in the Appellate Court, in both of which the salient and controlling features of the case are ably and fairly presented. We fully concur both in the reasoning and conclusion of those opinions.

Under the circumstances stated, entertaining the opinion we do, it would be a useless task to go over the whole ground again, which would necessarily be, in the main, but a repetition of what has already been so well said by the lower courts. We shall therefore content ourselves with briefly noticing a few of the points upon which appellants seem to place most reliance, and calling special attention to some of the provisions of the contract, above set forth, and upon which the conclusion we have reached is mainly rested.

Among other things, it is complained that the lower courts committed an “unpardonable error” in finding the two greases are substantially the same.- We do not think the facts warrant the strong terms in which this complaint is made. It is an undisputed fact that both greases are made from a combination of rosin oil, lime, sal-soda and water. In this respect they are certainly alike. So far as the product is concerned, from the evidence produced, it is, to say the least of it, doubt- ■ ful which, if either, is the better grease. Viewing the question, then, from a practical aspect, we think the lower courts were fully justified in finding the two greases were substantially the same. It is true the analyses which were made,—being four in number, by as many different chemists,—show some differences in the relative proportions of the ingredients used in making the two greases, but the diversity in this respect, conceding it to exist, is not, in our judgment, so great as to materially affect the rights of the parties to this controversy. So far as these analyses are concerned, it is worthy of note that no two of them are alike.

It. is also earnestly contended, that there can be no trademark in the name “Frazer,” and hence it is concluded there was error in the decree in enjoining Frazer from the use of his own name in connection with the business of the firm of which he was a member. It is certainly true, as a general proposition, that one can not, by using his own name as a trade-mark, deprive another having the same name, from using it in conducting his own business. But even here the latter will not, under cover of using his own name, be permitted to resort to any device or artifice by which the public will be led to purchase his goods or manufactured products under the belief that they are those, of the former. In the view we take of the case, we do not think it important whether the expression “Frazer,” “Frazer’s Grease” or “Frazer’s Axle Grease,” is, strictly speaking, a trade-mark or not. The important question, in our opinion, is, whether, under the facts averred in the bill, and proved on the hearing, Frazer, and those associated with him in the business, have the .right to use his name in connection with the manufacture and sale of axle grease of the kind and quality made and sold by them. This conclusion we rest upon the contract itself. Before the making of the contract, Frazer, like any other person who had not voluntarily parted with it, had the right to use his own name in conducting his own business, either by himself or in connection with others, provided it was done in a proper and legitimate wray. The right to thus use his name was a valuable one, rendered doubly so in his ease, because it was that of the discoverer of a valuable and popular article of trade then being manufactured and sold on the market by himself, under that name. But this right, like most other property rights, was the subject of sale and transfer, and, as we have already seen, he did, for a valuable consideration, so dispose of it. The question now is, will equity permit him, and those acting in concert with him, to defeat the right and title thus disposed of, in the hands of the assignee of his grantees.

The principle seems to be well settled, that where a party sells out an established business, and with it his own name, to be used in connection with such business, he can not after-wards resume it in carrying on the same business. Gillis v. Hall, Cox’s Am. Tel. Trade-mark Cases, 596; Witt v. Corcoran, Cox’s Manual, 423 ; Charton v. Douglass, id. 172; Ayer v. Hall, 3 Brewst. (Pa.) 509; Probasco v. Bouyan, 1 Mo. App. 241; Filkins v. Blackman, 13 Blatchf. 440.

The ease in hand falls directly within the doctrine of the eases cited. There is nothing, however, new in this doctrine. It is the old principle, that a title based on a sale for a valuable and adequate consideration, fairly entered into between parties sui juris, will be upheld, and enforced in equity as well as at law.

It will be seen, by looking at the contract in question, that Frazer, in the first place, sells and conveys, absolutely, all his right, title and interest in and to "the patent for making the rosin oil. He then proceeds to confer on the grantees, their “successors,” etc., the right to use his name, “so far as it might be necessary, to use it as a trade-mark, or as indicating the material or product which had theretofore been manufactured, under said letters patent, and generally known and called “Frazer’s Axle Grease,” etc. Had the agreement stopped here, there would, at least, have been a question whether this grant of the right to use Frazer’s name for the purpose stated, was intended to be exclusive. But as this right, unless exclusive, would have been of little or no value, it was a matter of great importance to the grantees that all doubt whatever on the subject should be removed, and for this purpose it is then added, that Frazer “confers the authority to use his name, as aforesaid, upon the parties of the second part, to their assigns, successors, etc., exclusively.” He also expressly Jiinds himself to confer such authority upon no other person or persons, corporation or association, whatsoever. Having thus covenated not to confer the. right to use his name upon any one else, he then stipulates as follows: “And the said party of the first part agrees and binds himself not to engage in the manufacture, directly or indirectly, of the product or material secured by said letters patent, ancl hnoiun as aforesaid.” If this covenant stood alone, there might be some question as to what was meant by it. But when taken in connection with the provision preceding it, which gives the grantees the right to use Frazer’s name as a trade-mark, or “as indicating the material or product” theretofore manufactured under the patent, “known and called Frazer’s Axle Grease,” etc., there is no room to doubt what was intended. The words, “known as aforesaid, ” evidently have reference to the same thing which is qualified and described by the words “known and called,” in the preceding stipulation in question,—namely, “Frazer’s Axle Grease.”

It is very clear that Frazer intended, and did, so far as the law would permit, to absolutely bind himself, without limit or conditions of any kind whatever, to not again engage in the manufacture of the rosin oil or grease in question. Whether it was competent for him to do this, it is not important to inquire, since, for the purposes of the conclusion we have reached, it way be conceded it was not, for, however that may be, he clearly did have the power to sell the exclusive use of his name in conducting that particular business. That power, as we have already seen, he exercised, receiving therefor a valuable consideration, and justice and equity alike demand that he should be held to his agreement.

Finally, Frazer expressly covenants not to use, or otherwise authorize the use of, his name as a trade-mark, or otherwise, for the manufacture of said lubricator, axle grease or grease, or any other product, under said letters patent. It will be observed, that the grease or axle grease to which the contract relates, is, throughout the instrument, characterized as a grease or product made under the patent. Yet it will be remembered the patent does not cover the process of making the grease. It only extends to the principal ingredient in it,—namely, the rosin oil. The process of obtaining that, alone, is covered by the patent, and it was therefore clearly in this sense the grease is spoken of, in the contract, as being made under the patent. When, therefore, Frazer covenanted that he would not use his name himself, or permit it to be used by others, in the manufacture of grease, or any other product “under said letters patent, ” he simply and obviously intended to bind himself not to use his own name; or suffer it to be used by others, in the manufacture of the rosin oil, or any grease or other product of which the rosin oil is a constituent part. This covenant, so far as the use of Frazer’s name is concerned, we hold, as already stated, to be a valid and binding obligation, both at law and in equity. That it has been violated by Frazer, and those acting in concert with him, is equally clear.

The judgment will be affirmed.

Judgment affirmed.


text:
    The Chicago and Eastern Illinois Railroad Company v. John McAuley.

      Filed at Ottawa March 22, 1887.

    1. Limitation—eminent domain—damages to contiguous property, not taken. Upon the construction and putting into operation of a railroad, all damages to contiguous property along the line of the road, present and prospective, from the location and operation of the road, are immediately recoverable, and must, all be recovered in one action; and if an action is not brought until after the lapse of five years, the Statute of Limitations will bar a recovery for any sum.
    2. Same—as to injury from nuisances—those which are permanent in character, and those not permanent hut continued. Where the original nuisance to land is of a permanent character, so that the damages inflicted thereby are permanent, a recovery not only may, but must, be had for the entire damages, in one action; and such damages accrue from the time the nuisance is created, and from that time the Statute of Limitations begins to run.
    3. In the case of nuisances which are transient rather than permanent in their character, the continuance of the injurious acts is considered a new nuisance, for which a fresh action will lie; and although the original cause of action is barred, damages may be recovered for the continuance of the nuisance.
    Appeal from the Appellate Court for the First District;— heard in that court on appeal from the Circuit Court of Cook county; the Hon. Thomas A. Moran, Judge, presiding.
    Mr. William Armstrong, for the appellant.
    Mr. H. O. McDaid, for the appellee.
   Mr. Justice Craig

delivered the opinion of the Court:

This was an action brought by John McAuley, against the Chicago and Eastern Illinois Eailroad Company, on June 10, 1881, to recover damages for the construction and operation of its railroad so near lot 5, in block 9, Carpenter’s addition to Chicago, (property owned and occupied by him,) that the property has been materially damaged and depreciated in value. The principal ground of complaint, as alleged in the declaration, and as attempted to be shown by the evidence, is, that in consequence of the running of trains on defendant’s tracks, constructed close to the premises of plaintiff, his property has been jarred and vibrated, and dust, smoke, cinders, ashes and other substances have been cast and thrown in and upon his dwelling and premises, thus injuring and depreciating in value his property. To the declaration the defendant pleaded the general issue and five years’ Statute of Limitations, and on a trial before the court, without a jury, the plaintiff recovered a judgment for $3000, which was affirmed in the Appellate Court. To reverse the judgment of the Appellate Court, defendant has brought the record here by appeal.

In order that the questions of law which are presented by the record may be properly understood, a brief statement of the facts upon which the legal questions arise, seems to be required.

The Chicago, Danville and Vincennes Railroad Company, a corporation organized under a charter granted by the State in 1865, under the powers contained in the charter and under, an ordinance of the city of Chicago, in 1872 constructed a line of railroad, from a point on Ada street, some two blocks west of plaintiff’s property, to the depot of the company, which was three blocks east of plaintiff’s property. The track so constructed runs near plaintiff’s property, in a south-easterly direction. The company about the same time built two short spurs from its main track, west of plaintiff’s property. The company also constructed two spurs from its main track, south of plaintiff’s property, running east to near Curtis street, to coal yards. The company also constructed a spur leaving the main track south of plaintiff’s property, and running south-west to the coal yard of Woodruff & Turnkey. The line of road, with its spurs and side-tracks, was operated by the company'until 1875, when the railroad passed into the hands of a receiver, under an order of the Circuit Court of the United States for the Northern District of Illinois. The road was then operated by a receiver until April, 1877, when it was sold, under decree of the court, to certain parties, who took possession and operated the road until August 28,1877, when they sold out to the Chicago and Nashville Eailroad Company. On this date, the last named company and the State Line and Covington Eailroad Company were consolidated, forming the Chicago and Eastern Illinois Eailroad Company,—the defendant. The defendant commenced to operate the road on August 28,1877. The map in the record, “Exhibit B, ” shows the condition of the tracks at this time. After the defendant took possession of the road, it constructed one additional spur to the coal yard of Woodruff & Turnkey, to furnish additional facilities for handling coal. The condition of the tracks while defendant operated the road, is shown by a map in the record, marked “Exhibit A.” We do not understand, from the evidence, that this additional track, constructed to the coal yard of Woodruff & Turnkey, by the defendant, enhanced the damages to the plaintiff’s property. On the other hand, Turnkey testified (and he is not contradicted) that “the additional tracks in our yard could not, in any manner, affect the McAuley property, and if it did, it would enhance its value. This additional switch reduced the actual work done there by the engines. ”

On the trial of the cause, the defendant, among others, submitted to the court the following proposition of law, which was refused: “When a railroad company builds and operates a railroad in this Staté, and as a result of such building or operation the property of an adjacent property owner is damaged, the party so damaged must commence his suit within the period of five years from the time said railroad was built, or commenced operation as a railroad.”

Before proceeding to a consideration of the proposition submitted, it may be proper to state that the decision in Chicago and Eastern Illinois Railroad Co. v. Loeb, 118 Ill. 203, substantially settles the principal questions involved in this case, although not presented in the same form as here. That was an action brought against the same railroad company as this, to recover damages to property located in the same neighborhood, which arose under the same circumstances as in this ease, with one exception. In this case, the action was brought by the person who owned the property claimed to be damaged, in 1872, when the road was first constructed and placed in operation, while in the case cited, Loeb bought his property in 1876, of the person who owned when the road was constructed'and placed in operation. Here, the Statute of Limitations is pleaded, while in the Loeb case the defence interposed was, that the entire cause of action accrued toLoeb’s grantor, the owner of the property in 1872, when the road was constructed and placed in operation. After a careful consideration of the Loeb case, and the authorities bearing upon it, we held that the entire cause of action, not only for present but future damages, accrued to the person who owned the property at the time the road was constructed and placed in operation, and that the vendee of such owner could not recover. We are entirely satisfied with the conclusion reached in that ease, and adhere to it.

As stated before, McAuley was owner in 1872, when the Chicago, Danville and Vincennes Eqilroad Company constructed its road and placed it in operation. The question presented by the decision of the court on the proposition of law is, whether his action is barred by section 15, chapter 83, of the Statute of Limitations, which reads as follows : “Actions to recover damages for an injury done to property, real or personal, * * * and all civil actions not otherwise provided for, shall be commenced within five years next after the cause of action accrued. ” The fact was established, by mncontroverted evidence, that the Chicago, Danville and Vin■cennes Railroad Company constructed its road in 1872, with its side-tracks, spurs and switches, and operated the same until 1875, when the road passed into the hands of a receiver, and was operated until 1877, when it passed into the hands of the defendant. The cause of action, therefore, accrued in 1872, but this suit was not brought until 1881, long after the Statute of Limitations had run against the cause of action.

. But it is said, in the argument, that there is no proof in the record that any damage was done to the plaintiff’s property while the road was operated by the Danville company. It may be true that no witness stated, in terms, that smoke, cinders and ashes were thrown in or upon plaintiff’s premises during that time; but that is a matter of no consequence whatever. The evidence does, however, show that the road was operated over the same tracks, in the same manner, by the Danville company; that it has been operated by the defendant ; and if no damages were sustained under the one management, it seems plain none could accrue under the other.

But it is said that the statute does not apply to a case of this character. Wood on Limitations, 371, says: “The rule in reference to acts amounting to a nuisance is, that every continuance is a new nuisance, for which a fresh action will lie, so that, although an action for the damage from the original nuisance may be barred, damages are recoverable for the six years preceding the bringing of the action, provided such a period of time has not elapsed that the person maintaining it has acquired a presumptive right to do so. * * * But while this is the rule as to nuisances of a transient rather than of a permanent character, yet when the original nuisance is of a permanent character, so that the damage inflicted thereby is of a permanent character, and goes to the entire destruction of the estate affected thereby, a recovery not only may, but must, be had for the entire damage, in one action, as the damage is deemed to be original. ” The author also says: “And as the entire damage accrues from the time the nuisance is created, and only one recovery can be had, the Statute of Limitations begins to run from the time of its erection, against the owner of the estate or estates affected thereby. ” See, also, on the same question, Troy v. Cheshire Railroad Co. 23 N. H. 101; Powers v. Council Bluffs, 45 Iowa, 652; Wood on Nuisances, 889.

In the Troy case it is said: “The railroad is, in its nature and design and use, a permanent structure, which can not be assumed to be liable to change. The appropriation of the road-way and materials to the use of the railroad is therefore a permanent appropriation. * * * The injury done to the town is then a permanent injury at once, done by the construction of the railroad, which is dependent upon no contingency of which the law can take notice, and for the injury thus done to them they are entitled to recover, at once, their reasonable damages.”

In E. L. and B. S. R. R. Co. v. Combs, 10 Bush, (Ky.) 393, which was an action to recover damages for throwing smoke, cinders and ashes, as is the case here, the court said: “We have heretofore held, in actions for injury to real estate by trespassers, that the plaintiff can only recover compensation for the injury done up to the commencement of the action; but that was in case of injuries not continuing and permanent in their character. The injury in this case, if any, is permanent and enduring, and no reason is perceived why a single recovery may not be had for the whole injury to result from the acts complained of.”

If, as held in the case last cited, the entire damages might be recovered in a single action, it follows that the entire cause of action accrued in 1872, when the railroad was constructed and placed in operation, and if that be true, the Statute of Limitations then commenced to run, and the action was barred long before this suit was commenced. Indeed, the decision in the Loch case, heretofore cited, leads to the same conclusion. We there expressly held, that upon the construction and putting in operation of a railroad, all damages which would be sustained as the necessary result of the operation of the road can be immediately estimated, and must be recovered in one action. The only logical conclusion to be drawn from that decision is, that unless an action is brought to recover the damages after they accrue, within the period provided by the statute, the cause of action will be barred.

Since the decision of the Loeb case, it has been suggested by counsel for the plaintiff that the question whether the Statute of Limitations, pleaded in this case, is a bar to a recovery, is one of fact, not reviewable here. We do not concur in this view. The question of law was raised by the proposition submitted, which the court refused.

The judgment of the Appellate and circuit courts will be reversed, and the cause will be remanded.

Judgment reversed.