author: Mr. Justice Sheldon

text:
    Stewart Patterson et al. v. Lorenzo M. Johnson, Exr.

      Filed at Ottawa

      May 15, 1885.

    1. Trusts—acceptance of a trust—evidence thereof. Where a trust deed contains a provision that the trustee thereby accepts the trust, and covenants faithfully bo execute the same, and the deed is signed by the trustee, and various acts of the trustee under and in recognition of the trust are shown, this will afford evidence of his acceptance of the trust, and the trust deed will take effect by such acceptance.
    2. Same—non-acceptance or abandonment of a trust as to the beneficiaries—of acts having such tendency. The failure to record a deed conveying property in trust for the benefit of the grantors and their father, for six or seven years, when a good reason appears therefor, is not evidence of any importance to show an abandonment of the trust by the parties in interest. And giving the principal management of the property to the life beneficiary, representing two-fifths of the property owned by others, not parties to the deed, is not inconsistent with the continued existence of the trust, especially where the trustee consults with and participates to some extent with the active manager in looking after the interests represented by him.
    3. The owners of three-fifths of a city lot conveyed the same to a trustee upon a certain trust, among which was the erection of a costly building upon the premises, and he was not willing to incur personal obligations in that behalf, but was induced to accept the trust under an arrangement that the trust deed should not be recorded, so as to enable the real parties in interest to obtain loans upon the property, for the furtherance of the contemplated improvement, which they did, giving their own notes, secured by their deeds of'trust on the property. It was held, that such acts were not inconsistent with the existence of the trust, and did not prove its non-acceptance or abandonment.
    4. Same—of a new agreement varying the provisions in a trust deed-effect upon the existence of the trust. The owners of a three-fifths interest in certain real estate, conveyed the same in trust, for the sole benefit of their father during his life, and after his death for their own use. Subsequently, they, in conjunction with an owner of another one-fifth interest, and the trustee, entered into a written agreement giving the father the control and management of the property, for which he was to receive $300 per month out of the income, which was all he was to receive from the property: Held, that while such agreement varied somewhat the provisions of the trust deed, it was not inconsistent with the prior existence of the trust, or with the trusteeship after its date.
    5. Same—of the reasonableness of a provision—as affecting the validity of a trust. A conveyance by three daughters, aged twenty, twenty-two and twenty-seven years, respectively, of their interest in certain real property, to a trustee, for the sole use and benefit of their father, then of the age of seventy-one years, and in embarrassed financial circumstances, made of their own volition, without the solicitation of the father, will not be set aside as being an unreasonable provision for the father.
    6. Same—powers of trustee—discretionary powers by implication. A discretionary power may be conferred on trustees, either by express terms of the trust, or by implication, from the nature of the duty imposed on them.
    7. Same—powers construed—as to the management of property. Three daughters, being the owners of three-fifths of an unimproved city lot, conveyed the same to a trustee, for the use of their father for life, and remainder for their use. The deed conveyed “with full power and authority in the said B. (trustee) to sell and convey said real estate in fee simple, or to mortgage or convey the same by trust deed, or to lease the same, and out of the moneys arising therefrom,” to reimburse himself, to discharge liens, and invest the remainder, or to pay the rents to the parties; and it also provided: “Said real estate being now unimproved and unoccupied, full power and authority is hereby given the said trustee, in his discretion," to borrow money upon said property, and to rebuild the same in such manner as to him shall seem best. In case he shall advance money himself for the purpose of rebuilding said property, then he shall have a lien thereon for the full amount of such advances:” Held, that the trustee was not confined to leasing the property after building upon the same, but his power extended to the making of any reasonable changes in the building which would be of benefit for the leasing of it, especially where the trustee had to act in conjunction with the other-two joint owners.
    8. Same—words construed,—as expressing ihe extent of the interest in the beneficiary. A trust deed made for the benefit of the grantor’s father, after the granting part and habendum clause “in trust,” contained these words: “The said H. L. S. (the father) has only a life interest in said estate, the remainder belonging in fee to his said daughters:” Held, that such clause was but an expression of the interest the father took under the deed, and not of what his interest was prior to the making of the same.
    9. BeyebsiONEB—whether entitled to an accounting — as against a tenant for life or. trustee. A person having only a reversionary interest in real property, and not entitled to the income from the same during the existence of the prior life estate, has no right to call upon the trustee holding the legal title, and the life tenant, for an account of the income of the property, but is entitled to an accounting only so far as it bears upon the allowance of debts claimed to be a charge against the property, and which may affect his reversionary interest in the same.
    10. Taxes—liability of life tenant. Where property is conveyed to a trustee in trust, for the use and benefit of A. during his life, with remainder in trust for the 'grantors, and the buildings thereon are destroyed by fire, so that for several years it yields no income, the life tenant will not be bound to pay the taxes on the same during the years it remains unproductive, and the trustee paying the same may properly have them charged upon the property.
    11. Guardian and ward—how far the latter bound by the action of the former. On a bill for an accounting, in respect to the income of real property and charges and disbursements, filed by a minor, by his guardian and next friend, the cause was referred to the master to take evidence and state the account. On the hearing, before the master, the minor was represented by his guardian in person, as well as by his solicitor, and the parties then filed a written statement of certain items in the accounts presented which they desired to dispute, and the evidence taken was in support or denial of these items: Held, that the minor was bound by the action of his guardian and solicitor in making up the issues on the accounts.
    12. Estopped—by recitals in deed. The grantee in a deed poll, with covenants of warranty, is not estopped to deny his grantor’s title.

      13. So where real estate had been conveyed to a party on certain trusts to be executed by him, the grantor conveyed the same property to another by trust deed, to secure a note in favor of his first grantee or trustee, it was held, that the latter was not estopped by the recitals and covenants in the second deed from claiming to act as trustee for the beneficiaries in the trust deed to him.
    14. Voluntary oonyeyanoe—want of power of revocation, as affecting the validity of the deed. The absence of a power of revocation is not of itself ground for setting aside a voluntary conveyance.' It is no more than a circumstance to be considered upon that question, in connection with all the other facts appearing in the case.
    15. Chancery — accounting — requiring written statement of disputed items. Where a cause is referred to a master to state an account between the parties in interest, of the income and rentals of property, and of the taxes, interest paid, and other disbursements, and the accounts of the parties are filed before him, the settled practice will warrant the master in having a written statement made of any disputed items of the accounts, and making them the basis of the evidence taken before him.
    16. Same—time for making o bjection or disputing items. Where parties appear before the master, to whom a cause is referred to state an account, and there file objections to such items in the accounts presented, as they desire, and the master hears evidence as to such disputed items and prepares his report, they can not, on objection to the draft of the report, dispute for the first time other items in the account.
    Writ of Error to the Circuit Court of Cook county; the Hon. W. H. Barnum, Judge, presiding.
    Mr. John Woodbridge, for the plaintiffs in. error:
    The trust deed to Pullman was never accepted by him, and if it was, the subsequent acts of the parties were inconsistent with the existence of the attempted trust. It was void upon its face, when construed with reference to the relations of the parties.
    The gift to the father could only be sustained upon the following conditions: First, that the daughters fully understood the condition of the title; second, that the father concealed no facts within his knowledge; third, that he did not exercise undue influence to procure the gift; fourth, that on the part of the donors it was not only an intelligent but a free-will offering; fifth, that it was reasonable, with a view to the circumstances of the parties; and sixth, that the donors should not rely on the attorney of their father, but should consult their own.
    The gift was void, because the daughters had no competent independent legal advice. Rhodes v. Bates, 1 L. R. Ch. App. 252; Prideaux v. Lonsdale, 1 DeG., J. & S. 433; Garnsey v. Munday, 24 N. J. Eq. 243; Russell’s Appeal, 75 Pa. St. 269 ; Huguenin v. Baseley, 3 L. C. in Eq. 108; Cook v. Lamotte, 15 Beav. 234; Phillipson v. King, 32 id. 628; Wollaston v. Tribe, L. B. 9 Eq. 44; Coalts v. Acworth, L. R. 8 Eq. 558.
    The same is invalid for want of a power of revocation. Wollaston v. Tribe, L. R. 9 Eq. 44; Coalts v. Acworth, L. R. 8 Eq. 558.
    The false recital in the deed that General Stewart had a life estate, is sufficient ground for setting it aside. Llewellin v. Cobbold, 1 Sm. & Gif. 380.
    If the deed was in fact delivered to Pullman, which is denied, Mrs. Patterson had a right to rescind by any appropriate action. Her series of deeds, and those of her sisters, for the use of Pullman and others, affords unequivocal evidence of her intention to rescind. Green v. Kent, 13 Mass. 518; Shufeldt v. Shufeldt, 9 Paige, 137; Spengler v. Snapp, 5 Leigh, 478; Ferris v. Crawford, 2 Denio, 595; Dix v. VanWyck, 2 Hill, 522; Post v. Dart, 8 Paige, 639; Powlasky v. Miller, 1 Stockt. 807; Daub v. Barnes, 1 Md. Ch. 127; Green v. Tyler, 39 Pa. 361; Newman v. Kershaw, 10 Wis. 333; Maher v. Lanfrom, 86 Ill. 521. .
    A trust may be repudiated without an express disclaimer, as, by evidence of the conduct of the party amounting to a refusal of the office; and a disclaimer may be presumed after long neglect to qualify, or refusal to act. 1 Perry on Trusts, sec. 270; Stacey v. Elph, 1 M. & K. 000; Ayres v. Weed, 16 Conn. 291; Thornton v. Winston, 4 Leigh, 152; Wardwell v. McDonell, 31 Ill. 364; Williams v. King, 43 Conn. 572.

      Messrs. Mason Brothers, for the plaintiff in error Stewart Patterson:
    As against an infant, everything must be proved. The guardian can admit nothing. Cochran v. McDowell, 15 Ill. 10; .Hill v. Ormsbee, 12 id. 166; Quigley v. Roberts, 44 id. 503 ; Gooch v. Green, 102 id. 507.
    It is the duty of the life tenant to pay the taxes. He can not charge the reversion with them, Prettyman v. Walton, 34 Ill. 175; Waldo v. Cummings, 45 id. 421; Estate of Miller, 1 Tucker, 346.
    The same rules of law apply, whether the estate be a legal or equitable one. 2 Story’s Eq. Jur. sec. 974; 1 Mad. Ch. 360; Fisher v. Field, 10 Johns. 494; Perry on Trusts, secs. 321, 357.
    It is held to be the duty of the trustee, if in possession, to pay the taxes, although taxes were not mentioned in the deed creating the trust, (Burr v. McEwen, Baldwin, (U..S. Cir. Ct.) 154,) and if not in possession, to see that the equitable tenant for life does so. Fountain v. Pellet, 1 Ves. Jr. 342; Tupper v. Fuller, 7 Rich. Eq. 170; Jones v. Daxvson, 19 Ala. 692.
    The law also requires tenants for life to pay interest on incumbrances. Moseley v. Marshall, 27 Barb. 42; Warley v. Warley, 1 Bailey’s Eq. 397; Swain v. Perine, 5 Johns. Ch. 482; Saville v. Saville, 2 Atk. 463. See, also, for a statement of the legal principle: 1 Washburn 'on Beal Prop. 96; 1 Story’s Eq. Jur. secs. 486,' 488; 4 Kent’s Com. 74; Perry on Trusts, sec. 554. See, also, Bond v. Lockwood, 33 Ill. 212.
    A tenant for life can not lay out moneys in building or improvements on the estate, and charge it to the inheritance. The court of chancery will not sustain an inquiry whether the improvements are beneficial. The tenant makes them at his own hazard. 4 Kent’s Com. (12th ed.)‘*76, note b; Caldcott v. Brown, 2 Hansch. *144; Floyer v. Bankes, L. B. 8 Eq. 115; Williams on Real Prop. 30, 32.

      The beneficiary under the trust deed took a vested interest, and the trustee could not release or change it. McDonald v. Starkey, 42 Ill. 442.
    In the following case the maker of a trust was not allowed to change it by his subsequent last will and testament. The court say: “An executed trust will be sustained and enforced in all its provisions. ” Padfield v. Padfield, 72 Ill. 323; Nicoll v. Ogden, 29 id. 332; Nicoll v. Miller, 37 id. 387; Nicoll v. Mason, 49 id. 358.
    A trustee is hound to perform his trust, whether he receives a salary or not. (Switzer v. Skiles, 3 Gilm. 529; Cooper v. McClun, 16 id. 435.) Therefore the agreement of January 1, 1878, so far as it assumes to change the minor’s rights under the Pullman trust, is invalid.
    Mr. James B. Galloway, guardian, also for Stewart Patterson.
    Messrs. Dexter, Herrick & Allen, for the defendant in error:
    The law presumes that every gift, whether in trust or not, is accepted, until the contrary is proved. Perry on Trusts, sec. 259; Hill on Trustees, 334; Bryant v. Walsh, 2 Gilm. 568.
    Perry says: “If the trust is created by deed, the most obvious, natural and effectual mode of signifying the acceptance is by signing the deed.” Perry on Trusts, sec. 260; Lewin on Trusts, 184; Viney v. Abbott, 120 Mass. 300.
    A trustee can not limit his acceptance. If he acts-at all, he will be held to have accepted the entire trust. Perry on Trusts, secs. 264, 401; Hill on Trustees, 344.
    It is well settled that even where, by mutual agreement, there has been a subsequent destruction or surrender of the deed with the intention of re-vesting the title, the title will riot re-vest in the grantor. Parker v. Kane, 4 Wis. 1; Cramer
      v. Porter, 41 Cal. 462; Kimball v. Greig, 47 Ala. 230; Jackson v. Anderson, 4 Wend. 474 ; Botsford v. Morehead, 4 Conn. 50; Gilbert v. Bulkeley, 5 id. 262; Raynor v. Wilson, 6 Hill, 464; Tibeau v. Tibeau, 19 Mo. 78; Morgan v. Elam, 4 Yerg. 411.
    This doctrine was expressly held by this court in Duncan v. Wickliffe, 4 Scam. 42, and Wilson v. Wood, 27 Ill. 199.
    This court has carried the doctrine so far as to hold that where an active trust has once been created, even though all the purposes of the trust have been subsequently fulfilled, and no further duties remain to be performed by the trustee, nothing short of a reconveyance can place the title back in the grantor. Kirkland v. Cox, 94 Ill. 414; Vallette v. Bennett, 69 id. 836.
    Parol proof to show a release of a trust is not admissible. Armstrong v. Merrill, 14 Wall. 120.
    The want of a power of revocation in a voluntary settlement, or the want of advice as to the insertion of such power, will not afford a ground for setting aside the settlement. Finucan v. Kendig, 109 Ill. 198.
    A party, by accepting a deed with covenants of warranty, is not estopped from disputing the grantor’s title. Owens v. Robbins, 19 Ill. 545; Becker v. Quigg, 54 id. 390; Sparrow v. Kingman, 1 Comst. 242; Averill v. Wilson, 4 Barb. 180; Finn v. Sleight, 8 id. 401; Coakley v. Perry, 3 Ohio St. 344; Osborne v. Tunis, 1 Dutch. 633; Edmondson v. Montague, 14 Ala. 570; Croxall v. Sherard, 5 Wall. 268.
   Mr. Justice Sheldon

delivered the opinion of the Court:

This was a bill in equity, filed by Stewart Patterson, a minor, by James B. Galloway, guardian of his estate and his next friend, in the circuit court of Cook county, September 5, 1878, making Hart L. Stewart, George M. Pullman, Hannah M. Williams, Helen W. Johnson, Stewart Clark, Frances V. Matthews and John C. Patterson, defendants. The bill alleges that just before October 25, 1871, the premises described in the bill, being the real estate situated on the north-west corner of Washington and State streets, in the city of Chicago,— ninety-two and a half feet on State, and ninety-five feet on Washington street,—were owned in fee simple by Jeanie Stewart, (afterwards Patterson,) Hannah M. Stewart, (now Williams,) Helen W. Stewart, (now Johnson,) Frances V. Matthews, and Hart L. Stewart, trustee for Stewart Clark, as tenants in common; that on said 25th of October said Hart L. Stewart, Jeanie, Hannah M. and Helen W. Stew'art executed and delivered to George M. Pullman their deed, wdiichwas subsequently recorded on February 15, 1878, conveying all the grantors’ interest in said property to George M. Pullman, as trustee, in trust for the sole use and benefit of said Hart L. Stewart during his life, and after his death for the use of the other makers, daughters of said Hart L.; that Pullman accepted the trust; that on January 6, 1875, Jeanie Stewart (then Patterson,) died intestate, leaving her surviving John C. Patterson, her husband, and orator, her only heir at law, the latter being at the time of filing the bill about three and a half years old. The bill was for an enforcement of the provisions of the deed of trust, and for an accounting. The defendants answered, all excepting John C. Patterson expressing entire satisfaction with the management of the trust, and denying the right to an account. John C. Patterson denied the validity of the deed of trust, and set up a claim in himself of a tenancy by the curtesy in the estate of his deceased wife, Jeanie Patterson. He also filed a cross-bill, setting up the same, and attacking the validity of the deed of trust. The court, on hearing, dismissed the cross-bill of John 0. Patterson, and granted relief, to some extent, on the original bill. The plaintiffs in the original and cross-bills bring this writ of error.

In respect of the cross-bill, the case under which will be first considered, it is contended that the trust was not accepted by Pullman, and therefore the title did not vest in him, or if the trust was accepted, that after the deed of trust was made it was ip fact abandoned by all parties to it. The trust deed contains this provision: “The said trustee hereby accepts the trust above created, and covenants faithfully to execute the same, ” and shows the signature of the trustee to the deed. Where the trust is created by deed, the most effectual mode of signifying the acceptance of the trust by the trustee is by his signing the deed. (Hill on Trustees, 214; Perry on Trusts, sec. 260.) Further, Mr. Pullman testifies: “I accepted the trust by signing my name to the deed and taking possession of the deed. After I accepted the trust, the deed was put in my safe, in the vault of the Pullman company, and was kept among my private papers. ” Various acts were, from time to time, done by Mr. Pullman under and in recognition of the trust, though the main management of the property, until in 1878, was .by Hart L. Stewart. In opposition to all the evidence of the acceptance of the trust, there is set up certain acts of the parties, and writings, which, it is claimed, are so inconsistent with the fact of acceptance as to overcome all the evidence in that regard. The neglect to record the trust deed until February 15, 1878,—more than six years,—which is spoken of, is evidently of itself of minor importance, and especially where, as here, a purpose consistent with the trust is shown for keeping the deed from record.

The trustee’s alleged inaction in the business of the management of. the property is relied upon. At the time of the fire of October 8 and 9, 1871, the building upon the property was burned. Up to that time Hart L. Stewart had had exclusive management of the property,—building, rebuilding, collecting the rents, etc.,—by the consent of the owners of all the five interests in.the property. After the date of the trust deed there was a three-fifths interest in the trustee. Hart L. Stewart was the trustee of a one-fifth interest belonging to Stewart Clark, the agent of another one-fifth interest belonging to Frances V. Matthews, and he had himself the interest of a life tenant in the three-fifths conveyed to the trustee, and was the father and grand-father of the owners. This condition of things would suggest the propriety of one common manager for all the five interests, and the fitness of Hart L. Stewart as such manager, and he appears to have had the substantial management of the property, but yet with enough of consultation with and cooperation on the part of Mr. Pullman to indicate that the trust was all the while subsisting in the latter.

As mentioned, the deed of trust was not recorded until in 1878, and there is an exhibition of a formidable array of writings made before that time, consisting of a petition of Hart L. Stewart to the county court for leave to mortgage the one-fifth interest of Stewart Clark, trust deeds made of the property to secure sums of money, policies of insurance on the property, a power of attorney to Hart L. Stewart to execute.leases and collect rents, leases made thereunder, and other writings of and'between the parties beneficially entitled, in all which the parties holding the title of record are declared to be the present owners of the property.

The property was rebuilt, and a loan of $125,000 for the purpose was obtained upon the security of the property. The deed of trust to Pullman authorized this, but there was no mention of his title or name in connection with the loan. The written application for the loan by Hart L. Stewart stated the title to be in the heirs of Hannah B. Stewart, his deceased wife, naming them. The abstract of title exhibited showed ■ the record title to be in them, and the trust deed on the property to secure the loan was executed by them, alone. The explanation for this, and with respect to all the other writings, is, that Mr. Pullman made the objection to accepting the trust that it might become necessary for him to sign notes and mortgages for the loan, and the attorney who drew the deed of trust suggested to him that that necessity might be avoided by the owners themselves signing the papers and borrowing the money, and Mr. Pullman testified his recollection was that the attorney stated the trust deed need not be put on record, and that he would be in that way relieved of the necessity of signing the notes and obligations. With this explanation, we think it may be said, in general, of all these various writings, without going into them in detail, that they are not irreconcilable with the existence of this deed of trust to Mr. Pullman, and his acceptance of the trust, but that they may well consist therewith.

The same observation may be made with respect to the position that the conduct of all the parties to the deed of trust shows an abandonment of it even if it were accepted. There is no pretence of any mutual agreement of abandonment. All the evidence relied on as showing such abandonment is the supposed inconsistent writings and acts of the parties which we have referred to.

In respect of one trust deed, (that made by Jeanie Patterson, and her husband, and the other holders of the title of record, on January 7, 1874, conveying this property to Henry S. Monroe, in trust, to secure a note in favor of George M. Pullman,) it is insisted that as that deed contained full covenants on the part of the grantors, of seizin, freedom from incumbrances, and general warranty, Pullman is estopped thereby from claiming under the deed of trust of October 25, 1871. The deed was not signed by Pullman, and the rule of law is, that the grantee in a deed poll, with covenants of warranty, is not estopped to deny his grantor’s title. (Owen v. Robbins, 19 Ill. 545; Sparrow v. Kingman, 1 Comst. 242; Kingman v. Sparrow, 12 Barb. 201; Great Falls Co. v. Worster, 15 N. H. 450; Gardner v. Greene, 5 R. I. 104; Coakley v. Perry, 3 Ohio St. 344.) There are here no elements of an estoppel in pais, by the acceptance of the deed. The same may be said in regard to the effect of the trust deeds to Henry S. Monroe, for the use of Hart L. Stewart, of January, 1874, and November, 1874, on the rights of Hart L. Stewart.

Much stress is laid upon the agreement of January 1, 1878, as showing that the trust deed was not in force before that • time, but only thereafter, and that the execution of that agreement was made the condition of the recording of the deed of trust, and of Pullman’s acceptance of the trust. That agreement was made between Pullman and all the parties having any interest in the property, except the minor complainant in the original bill. The agreement describes the trust deed, and makes reference to it for its terms and provisions, and names that it is to be recorded on or before March, following. The parties release each other from all claims growing out of the past control and management of the property, and agree that Hart L. Stewart shall, from that date during his life, control and manage the property, for $300 per month, to be paid out of .the income, which should be all that he should receive from the property. The agreement varies somewhat from the provisions of the trust deed, but we do not perceive that it is inconsistent with the trust deed, having been in force from its date, (October 25, 1871,) and with the trusteeship of Pullman since that time. The agreement, too, approves the existing indebtedness of the property, and makes provision for its future joint management, as a whole, by Hart L. Stewart and George M. Pullman.

It is insisted that by reason of the relations between the grantors and the beneficiary of the life estate, (Hart L. Stewart,) and under the principles governing voluntary conveyances, the deed of trust was void. It is said the deed was wholly unreasonable, in view of the circumstances of the parties. The occasion of the making of the deed is thus detailed in the answer of Hannah M. Williams and Helen W. Johnson, the two surviving grantors: “That they and the said Jeanie, the mother of orator, always, up to the date of the deed to George M. Pullman, regarded said property as, in equity and morals, justly belonging to Hart L. Stewart, their father, and felt that he had the sole right to the rents, issues and profits of the same, and the right to control and manage the same; that after the fire of October, 1871, knowing their father, Hart L. Stewart, was in feeble health, and that said property had been bought and paid for by him, and that he had, in the purchase and building up of said property, used a very large part of his own means, and feeling that under any and all circumstances their father ought, in justice, to have sufficient out of said property or its avails to insure his support during his life, they consulted with their friend and attorney, Henry S. Monroe, as to the best means of securing to their father such support, and that he advised them to deed their interest in said property so as to secure their desire ; that they and the said Jeanie then applied to said Pullman, their friend, and relative by marriage, and desired him to accept the said trust, said Jeanie being the most active in her desire; that said Pullman at first declined to accept, hut finally was induced so to do.” The evidence accords with this answer. At the date of the deed to Pullman, Jeanie Stewart was nearly twenty-seven years old. Her sisters, Hannah and Helen, were, respectively, twenty-two and twenty years of age. The father, Hart L. Stewart, was seventy-one years old. The record shows that there was no influence whatever used by the father to procure the deed, and that it was made by the daughters of their own volition. The making of the deed was a graceful tribute of filial affection.

It is insisted the daughters did not understand the condition of the title at the time they made the deed. This is based on the following language in the deed: “The said Hart L. Stewart has only a life interest in said real estate, the remainder belonging in fee to his said daughters. ” It is a wrongful assumption, in our view, that this is a recital as to the state of the title prior to the making of the deed. The language occurs after the granting part of the deed, and after the habendum clause, “in trust, ” etc., and is in that part of the deed which defines the trust, and was inserted, as we understand it, to make clear the purpose that Hart L. Stewart should have only a life interest, and that the remainder belonged to his daughters,—that it was an expression of the interest which he took under the deed, and not of what was his interest prior to the making of the deed.

It is said the daughters were in error as .to their father’s financial condition. Notwithstanding the particulars of evidence which are relied on to the contrary, we think the whole testimony shows that the father was in embarrassed financial circumstances at the time.

It is said the deed contains no power of revocation, and should for that reason be set aside. The absence of a power of revocation is not, of itself, ground for setting aside a voluntary conveyance. It is no more than a circumstance to be considered upon that question, in connection with all the other facts appearing in any particular case. Finucan v. Kendig, 109 Ill. 198.

It is insisted the deed is void because the daughters had no independent legal advice. If that be necessary, which we do not admit, it sufficiently appears here that there was such advice. The evidence shows that before the deed was made Mrs. Patterson advised with her friend, George M. Pullman, with Mr. Tewkesbury, whose wife was an intimate friend of Mrs. Patterson, (Mr. Tewkesbury being an attorney,) and with Mr. Monroe, who drew the trust deed, and he being an intimate friend of the family. Although it appears that he had been for many years Hart L. Stewart’s legal adviser, the evidence shows that the daughters, of their own motion, consulted him for themselves, and that Hart L. Stewart had nothing to do with employing Mr. Monroe to draw the trust deed, or made any suggestion in regard to it. The cross-bill alleges that the attorney who drafted the deed received his instructions from the daughters.

Certain powers given by the trust deed are pointed out as being so unreasonable, and of such dangerous character to the interests of the grantors, as to require that the deed should be set aside. Although one or more of the provisions, literally taken, might be capable of abuse and of producing wrong, yet under the reasonable construction which should be given them, we can not view them as being obnoxious to the extent which is claimed. We perceive no error in the dismissing of the cross-bill.

We come now to the consideration of the case of the original bill. Much of what it claimed has been abandoned by complainant, or otherwise taken out of the ease since the bill was filed.

The original bill alleged that complainant was entitled, under the trust deed, to a present interest in the income,— one-fifth of the annual net income. The decree found this claim not to be sustained, and this finding does not appear to be, and could not well be, urged as a ground of reversal. The bill alleges that taxes had been permitted to remain long due and unpaid upon the property, and that unpaid interest had accumulated on the indebtedness upon the property to a large amount, and prays that Pullman be directed to pay off all said taxes and accrued interest. The record shows that all these taxes and unpaid interest were paid off before the final hearing. The original bill alleges that the defendant Pullman is accountable for the alleged waste and mismanagement of Hart L. Stewart, and prays for his removal as trustee. This relief was denied by the decree, and no point is made on that ruling. The matters now in controversy, as we regard, are: First, the accounting; second, the indebtedness of the property allowed by the decree; and third, the validity of the agreement of January 1, 1878.

The order for an accounting was entered December 30, 1879. At that time the cross-complainant claimed an accounting of all receipts on the ground that the trust deed was invalid, and the original complainant claimed such an accounting on the ground that he was entitled to a present interest in the income. This order referred the cause to the master,—first, “for the purpose of ascertaining all legal liens and incumbrances existing against the property on October 25, 1871;” and second, taking an account, from that date down to the date of the decree, of all rents, profits, loans, claims, income, receipts and disbursements, of, from and concerning the property. A second order of reference was entered November 23, 1880, directing the accounting to be brought down to the date when the master made his report, and that the defendants file with the account a statement of the liabilities of the property at the date of the order. Under these orders defendants filed detailed accounts, in "writing, showing the several items of receipts and expenditures; also, a statement of the liens and incumbrances on October 25, 1871, and a statement of the liabilities of the property on December 17, 1880. The master’s report states that at the suggestion of the master the complainant’s solicitors, and cross-complainant, filed in the master’s office, for the purpose of narrowing the issues in the account, a written classified statement of disputed items; that this statement of disputed items was the basis of the evidence formally taken before the master, and that the evidence given by the respective parties was in support or in denial of the- disputed items in this statement not otherwise admitted. A third order for an accounting, from December 17, 1880, to April 1, 1881, was entered, and this account was also filed with the master, and the master subsequently filed his report, dated April 1, 1881. The master returned into court the defendants’ accounts, the1 complainant’s lists of disputed items, and the master’s evidence taken on those items. On October 1, 1881, a decree was entered dismissing the cross-bill for want of equity, and on June 12,1882, a final decree was entered on the original bill, finding that the trust deed created a life estate in Hart L. Stewart, for his own sole use during his life, the interests of the other grantors in the trust deed being only reversionary upon said life estate. Having found that the complainant had no present interest in the income, the court decreed as to the accounting, that defendants’ accounts are approved and allowed as to all items in said accounts, except “the disputed items,” which are specifically enumerated in the decree. It finds the total of undisputed receipts, and of undisputed disbursements, and the net income from the property. “That it is not necessary to the final determination of this suit to adjudicate upon the several disputed items in said accounts.” And the decree finds the amount of the indebtedness of the property, specifying the items. The complainant contends that the court erred in not settling the items in the defendants’ accounts which were disputed by complainant, and not stating the account and striking a balance, and in allowing the several claims of indebtedness of the property, except the $125,000 due Mrs. Green.

As the complainant had no interest in the income, he had no right to an account of the income, and any accounting would only be material as it had bearing upon the allowance of the indebtedness claimed to be a proper charge against the property. If the court, on the evidence before it, could determine as to that indebtedness, there would not seem to be occasion to proceed and determine upon the large number of disputed items, and settle the account. What could be the use in so doing ? The complainant had no interest in the income from the property; there could be nothing coming to. him; there could be no decree in his favor, except for costs ; his only interest was as reversioner in the corpus of the property, and thus he was only concerned in the allowance of the indebtedness of the property, which question we do not see that the settlement and adjustment of the disputed items in the account would affect.

The first of the items of indebtedness of the property allowed by the decree, is the Green loan, amounting to $125,000. This was a loan obtained for the rebuilding of the property, and the correctness of this item is not disputed. The remaining items of said indebtedness consist of advances made by Pullman, the trustee, and Hart L. Stewart,—three by the former, ($3621, $3000 and $13,000,) and one ($3621.29) by the latter. The $3621.29 was advanced in 1883, to pay taxes which were liens on the property at the date of the trust deed,—October 25, 1871. The property was not rebuilt, and 3'ielded no income, until November, 1873, and there can be no claim that the life tenant was bound to pay those taxes, and they were a proper indebtedness of the property. The $3000 was advanced by Pullman to pay a loan made by the Union National Bank to the property, for the payment of taxes. The $13,000 is the balance of $23,000 advanced by Pullman under the following circumstances: Prior to 1878 the building had been finished off as a hotel, and was occupied as such by one Strong, under a lease running for a term of years. Some time in 1878 the adult parties in interest, including Pullman, found that owing to recent changes of business in the locality, a largely increased rental could be obtained by changing the upper floors into large rooms, to be rented for mercantile purposes, and decided that it was for the benefit of the property to make the change. In order thereto, it was necessary to buy out the Strong lease, which was done by the payment of $4008.73. The change was made, resulting, in an immediate advance of the rental of $10,300 a year,—the upper floors previously paying a rental of only from $200 to $300 per month. The cost of making this change, including the $4008.73 paid to Strong, was $14,-435.71. The items making up this amount were included in defendants’ account, and were not disputed by complainant, except the payment to Strong. Prior to this change, Hart L. Stewart had consented, by agreement of January 1, 1878, to accept the sum of $3600 per annum from the entire property, as compensation for his services, and in lieu of his share of the income. In making the alterations, the parties applied the income in payment for them and to other indebtedness, permitting the interest on the Green loan to accumulate. On February 10, 1881, Pullman advanced $23,000, which was applied in payment of the accumulated interest on the Green loan. Prior to the date of the final decree, this indebtedness was reduced, by payments of principal ■ and interest, to the amount then unpaid,—$13,000. This amount is less than the cost of making the change which was made. The fourth disputed item of indebtedness allowed by the decree was a balance of $3621.29, advanced by Hart L. Stewart for the payment of interest.

The objection made to the decree in the allowance of these advances is, that they were actually used in payment of taxes and interest which the life tenant was bound to pay out of the income, so that the decree charges upon the property the burden of taxes and interest upon incumbrances which it was the duty of the life tenant to pay as they accrued, and of the trustee to see that this was done; that the alteration made in the building was not a permanent improvement, and if it were, that a tenant for life can not lay out moneys in improvements on "the estate and charge the same to the inheritance, although the improvements be beneficial,—citing 4 Kent’s Com. (11th ed.) 81, note b, and other authorities; that the remodeling of the upper floors was a diversion of money that should have been used in paying interest, and that persons who participate in the diversion of trust funds are not allowed the pecuniary profit realized thereby, but that goes to the innocent reversioner, the law giving him a present beneficial ownership to the extent of the enhanced income caused by the diversion of the trust funds. To this it is answered, that if, on the basis of the undisputed items in the account of all receipts and disbursements, the life tenant, after being charged with the Pullman advances as actual receipts, is not indebted to the property, then it follows that these advances were properly allowed. In the account the entire receipts, including the rentals, are charged to the life tenant. But the income did not belong to the reversioners, and in determining the amount properly chargeable to the life tenant, the net income should be deducted from the total receipts. The net income was found by the decree, as it was arrived at in the master’s report, by giving a statement of the receipts from rental of each year, charging against them the taxes, insurance, repairs, and interest on the Green mortgage for that year, showing an aggregate of net income of $52,549.58. Defendants’ counsel submit a calculation which, after deducting such net income from the receipts, shows an excess of undisputed expenditures over the total receipts undisputed, of $16,278.72,—a balance in the life tenant’s favor of that amount. The $3621.29 advance by Hart L. Stewart, before spoken of, is the only amount he claims in lieu of the large balance thus appearing in his favor. Another calculation is submitted, which shows an excess of payments for incumbrances, permanent improvement, the alteration before mentioned, commissions on the Green loan, over the total indebtedness of the property as allowed by the decree, of $8991.41, and this without allowing the amount paid Strong for surrender of his lease. Without entering into and giving the figures, further than the result, we will say these ealcu0 lations appear to us to be correct.

There is complaint by the plaintiff that the decree does not correctly declare what the disputed items in the account were. This comes from the court not recognizing as disputed items any outside of the list of disputed items which was filed. The disputed items complained of as not being recognized, appear all to have been in defendants’ first account exhibited before the master, and were none of them included in complainant’s list of disputed items, and are not mentioned in the master’s report as among the disputed items. The first time the record shows that any question was made as to any of these items, was after the draft of the master’s report was prepared, when complainant included in his objections, which were subsequently treated as exceptions, objections to the allowance of these last items. The master reports that the list of disputed items filed with him “was made the basis of the evidence taken before the master, and that the evidence given by the respective parties was in support or denial of the disputed items in this statement not otherwise admitted. ” The list of disputed items formed the issues as to the items in the account, and it would not seem proper for the complainant, on objections to the draft of the master’s report, to dispute for the first time these items.

It is said the statement of disputed items, and the subsequent proceedings based on them, were not binding on the complainant, he being then a minor. The course adopted by the master in having a written statement made of the disputed items, was in accordance with the well settled practice. (Remsen v. Remsen, 2 Johns. Ch. 501.) The master reports that on the hearing before him, the complainant was represented by his guardian, in person, as well as by his solicitor. We think the minor complainant was bound by their action in making up the issues on the account. We can not say the court erred in its ruling as to what the disputed items were.

It is answered to the objection that these advances were actually used in payment of taxes and interest which the life tenant was bound to pay out of the income, that it was competent for the parties, for the time being, to apply the income for other purposes, permitting the taxes and interest to accumulate, and to subsequently borrow the money to pay taxes and interest, which they might have borrowed in the first instance to make the expenditures; that the result to the reversioner is the same; that the advances were in fact made to repay to the fund which might have been applied to interest and taxes, the amount borrowed of it for other expenditures; that whether the advance should be repaid does not depend upon whether the money went to pay this or that particular item, but on the account as a whole. We are inclined to adopt the views of defendants’ counsel with respect to these advances.

We do not think the rules with regard to mere life tenants and trustees, which have been adverted to by complainant’s counsel, should, in their strictness, be applied here, under the circumstances of this case. The property conveyed by the trust deed was at the time unimproved, and subject to charges and incumbrances. The trust deed gives to the trustee large discretionary powers. It conveys in trust, “with full power and authority in the said George M. Pullman to sell and convey said real estate in fee simple absolute, or to mortgage or convey the same by trust deed, or to lease the same, and out of the moneys arising therefrom, ” to reimburse himself, to discharge liens, and invest the remainder, or to pay the rents to the parties. It also provides: “Said real estate being now unimproved and unoccupied, full power and authority is hereby given to the said trustee in his discretion to borrow money upon said property, and to rebuild the same in such manner as to him shall seem best. In ease he shall advance money, himself, for the purpose of rebuilding said property, then he shall have a lien thereon for the full amount of such advances. ” The property was not a sole interest, to be subject to a sole management, but it was owned in five undivided interests, of which the trust deed embraced the conveyance of but three-fifths. The other two-fifths had equal right to the possession, and equal voice in the management, and a proportional interest in the income. The trust deed contemplated a joint management, which would have to be the result of concurrent action, and we think it but the fair construction that it impliedly gave authority to do, in the management of the property, whatever was necessary to be done, to secure the cooperation of all the joint owners. The two-fifths interest was an absolute ownership, unhampered by any rule as to making improvements, or applying income, as it accrued, to the discharge of taxes and interest; and it may have preferred, and insisted upon, the applying of income to the payment for improvements or other expenses, and allowing taxes and interest to remain unpaid for a time. And in support of the action of the trustee and life tenant we think it may reasonably be presumed that such was the case here, and that the method which was adopted of applying the income, and allowing taxes to remain unpaid and interest to accumulate, was demanded by the other joint owners, and was yielded to as the necessity of a joint management. The management of the property has been advantageous. No loss has resulted, but gain. There is but the suggestion that there was possibility of loss, from the liability of the mortgage to foreclosure on account of the arrears of unpaid interest. But the foreclosure of the mortgage was a thing to be desired for the interest of the property, as it appears that the money could at any time have been procured at a less rate of interest than the mortgage bore, and there had been offer to pay off the mortgage, and the offer refused.

The change which was made in the upper floors of the building,. whereby a largely increased rental was obtained, we regard not merely as a temporary change for the accommodation of a particular tenant, but think it may be viewed as a permanent improvement, and one authorized to be made under the powers given by the trust deed. The trust deed contemplated a continuous leasing of the property after the death of the life tenant. It provided for paying the rents afterwards, in equal proportions, to the daughters, but allowing to any one, after arriving at the age of thirty-five years, the right to have her interest sold. Under the broad power given, of rebuilding in the discretion of the trustee, and leasing the property continuously until any such sale, it is not to be supposed that it was the intention to confine the trustee’s power in the management of the property, when rebuilt, to the mere leasing of it, but that it should extend to the making of any reasonable change in the building which would be of benefit for the leasing of it, and especially where, as here, the management of the property was to be of it as a whole, in conjunction with the other joint owners. A discretionary power may be conferred on trustees either by express terms of the trust, or by implication, from the nature of the duty imposed on them. Hill on Trustees, 485.

It is to be noted that the several items of indebtedness allowed in the final decree as valid charges on the property, have been assented to and approved by all the parties having an interest in the property, except the minor complainant, and he having but a one-fifth interest. We can not say there was error in the allowance by the decree of these items of indebtedness.

As respects the agreement of January 1, 1878, this, as has been observed, was an agreement for a common management, signed by all the parties in interest, beneficially or otherwise, except the minor complainant. It is contended by complainant that this agreement is a departure from the Pullman trust deed of October 25, 1871, and is therefore invalid, and that the court erred in not passing upon its validity. Although the agreement is referred to in the original bill, the complainant has not alleged its invalidity in his bill, or prayed to have it set' aside. The court below seems to have taken the same view of this agreement as of the disputed items of the account,— that for the determination of this suit it was not necessary to pass upon the agreement as being valid or invalid, as the bill did not ask for its being vacated. We concur with that view, perceiving no practical necessity, in the decision of this case, to determine as to the validity of that agreement. It is now still less a. practical question, as since the final decree was entered, Hart L. Stewart has died, his estate being represented in this court by Lorenzo M. Johnson, executor.

The decree will be affirmed.

Decree affirmed.


source: Caselaw Access Project

author: Mr. Justice Craig

license: Public Domain

text:
    William Beard et al. v. Janet Skeldon.

      Filed at Ottawa

      May 15, 1885.

    1. Mines and mining—provisions for safety of miners—providing a brake for the drum—the statute construed. The manifest object of section 6, chapter 93, of the Revised Statutes, in requiring that “every drum shall be provided with a sufficient brake to prevent accident in case of the giving out or breaking of the machinery, ” was to provide such brake as a protection to the life of the miner, in the cage ascending or descending, where, at any time or for any cause, the machinery used in raising or lowering the cage should refuse to perform any of its proper functions. The brake is required to stop the cage whenever there may be danger, whether it arises from the giving out or breaking of machinery, or for some other cause. A failure of the machinery to perform its proper office may be regarded as a “giving out, ” within the meaning of the statute.
    2. Same—death of miner from negligence of the proprietor—of the right of action therefor—the statute construed. That part of section 14, chapter 93, relating to “Miners,” which provides that in case of loss of life by reason of any willful violations of the act, or willful failure to comply with any of its provisions, “a right of action shall accrue to the widow of the person killed, his lineal heirs or adopted children, or to any other person or persons who were, before such loss of life, dependent for support on the person or persons so killed, ” authorizes but one action and but one recovery for the entire loss.
    3. Under that act, if the deceased miner leaves a widow surviving, she is entitled to sue and recover for the loss, whatever it may be; but if there is no widow, a right of action is conferred upon his lineal heirs or adopted children, if any, and if there is no widow or lineal heirs or adopted children, then any person may maintain the action who before the death was dependent for support on the person killed.
    4. Measure oe damages—death of miner—elements to be considered. In an action on the case, by the widow of a miner, against the proprietors of a mine, to recover for the death of her husband, under section 14, chapter 93, of the Revised Statutes, the court instructed, that in assessing damages “the jury may allow all such pecuniary damages sustained by the plaintiff as are the direct result of the death of her husband; and in making their estimate of the damages, the jury may take into consideration whether or not said deceased left surviving him, in addition to said widow, any children:” Meld, that the instruction was not erroneous.

      5. Error will not always reverse—as to the giving of instructions. Where the proprietors of a coal mine had provided no brake of any kind to a drum connected with the hoisting machinery of a coal shaft, in consequence of which the plaintiff’s husband was killed, it was held, in an action to recover damages for the death, that an error in an instruction containing a requirement as to the character and quality of the appliances for a brake, somewhat stronger than the statute required, could not have prejudiced the defendant, as no question was presented as to the quality or sufficiency of a brake.
    Appeal from the Appellate Court for the First District;— heard in that court on appeal from the Superior Court of Cook county; the Hon. Rollin S. Williamson, Judge, presiding.
    Messrs. McConnell & Smith, for the appellants.
    Mr. William Mooney, and Mr. William H. Skelly, for the appellee.
   Mr. Justice Craig

delivered the opinion of the Court:

This was an action by Janet Skeldon, a widow, against appellants, proprietors of a coal mine at Godfrey, in Grundy county. The action was brought under section 14, chapter 93, of the statute entitled “Miners,” by the widow, to recover for the death of her husband, who was killed at the bottom of appellants’ coal shaft, in consequence of the cage descending upon him, while in the discharge of certain duties which he was ordered to do by appellants’ foreman in charge of the mine. The cause has been tried three times, before a jury, in the circuit court, and in each trial the plaintiff recovered. On the last trial she obtained a judgment for $3500, which was affirmed in the Appellate Court.

As grounds for reversing the judgment, it is first claimed by appellants that the court erred in instructing the jury that in assessing damages “the jury may allow all such pecuniary damages sustained by the plaintiff as are the direct result of the death of plaintiff’s husband; and in making their estimate of the damages sustained by said widow, the jury may take into consideration whether or not said deceased left surviving him, in addition to said widow, any children.” It is contended that the statute gives a right of action, in case of death, to three distinct parties: First, to the widow; second, to the lineal heirs or adopted children of the deceased; and third, to any person who may have been dependent on deceased for support,-—and hence the instruction, which authorizes a recovery by the widow for the entire loss, is in conflict with the statute. Section 14 of the statute under which this action is brought, provides: “For any injury to person or property occasioned by any willful violations, * * * a right of action shall accrue to the party injured for.any direct damages sustained thereby; and in case of any loss of life * * * a right of action shall accrue to the widow of the person so killed, his lineal heirs or adopted children, or to any other person or persons who were before such loss of life dependent for support upon the person or persons so killed, for a like recovery of damages for the injuries sustained by reason of such loss of life or lives.” We do not think the construction placed on the statute by appellants’ counsel is the correct one. The statute, in our opinion, authorizes but one action,—but one recovery for the entire loss. If the deceased leaves a widow surviving, she, under the statute, is entitled to sue and recover for the loss, whatever it may be; but in ease there should be no widow, but lineal heirs or adopted children, then the right of action is conferred upon them. But if the deceased should leave no lineal heir's or adopted children, then any person might maintain an action who, before the death occurred, was dependent for support upon the person killed. This, in view of the language' of the statute, we regard as a reasonable and proper construction of it. To require three actions to be brought by' three different parties for oúe and the same cause of action, would be productive of useless costs and expenses, which we do not believe was ever within the contemplation of the legislature in the enactment of the law. The right of action-is conferred in the alternative, and when one party entitled to sue brings a suit, all damages which may be recovered on account of the death, must, of necessity, be obtained in the judgment rendered in the suit.

If we are correct in our construction of the statute, defendants’ instructions numbered twelve, thirteen and fourteen were properly refused.

Section 6, chapter 93, among other things provides that the operator of every mine operated by shaft shall provide safe means of hoisting and lowering persons in a cage covered with boiler-iron; and such cage shall be furnished with guides to conduct it, in slides, through such shaft, with a sufficient brake on every drum, to prevent accident in case of the giving out or breaking of the machinery. The court gave a construction to the statute in one instruction to the jury, as follows:

“That the design of the statute in requiring that the drum connected with the hoisting machinery of a coal shaft should be supplied with a brake, was to compel the furnishing of an appliance which would hold the cage securely while suspended in or over the shaft, and prevent its going down in case the machinery for any reason should fail to be sufficient to hold it.”

The statute expressly requires a brake on every drum, so as to prevent accident in case any of "the machinery should break or give out; but we do not understand that the statute compels the furnishing of such an appliance as might prevent an accident in case the machinery should for any reason fail. The instruction contains a requirement somewhat stronger than the statute, and should have been somewhat modified; but we do not think the language of the instruction had any prejudicial influence on the jury, and if it did not, its imperfection forms no substantial ground for a reversal of the judgment. There was no question in the ease in regard to the quality or sufficiency of a brake. No brake whatever was furnished on the drum. There was an entire disregard of the requirement of the statute in this respect, and, doubtless, on this account Skeldon lost his life, as it is apparent from the evidence of the engineer that if a good brake had been on the machinery and in use, the accident would not have occurred.

It is also contended that the court erred "in instructing the jury as to what was a “giving out” of the machinery, within the meaning of the statute, as follows:

“And any giving away of -the machinery, whether from the breaking or imperfection of some of its parts, a failure of the motive or static power, or from any other cause, would be and is a ‘giving out’ of the machinery, within the meaning of the law, in this case.”

The words of the statute, “giving out or breaking of the machinery, ” are not to be given a narrow or contracted meaning. A sufficient brake is required to be placed on every drum, which might reasonably be expected to prevent accident in ease of the giving out or breaking of the machinery. This statute was passed by the legislature as a protection to the life of the miner, and it should be construed with the same liberality which led to its enactment. Doubtless, the manifest object in requiring a brake on the drum was as a protection to the life of the miner, in the cage ascending or descending, when, at any time or for any cause, the machinery used in raising or lowering the cage should refuse to perform any of its proper functions. The brake is required to stop the cage whenever there may be danger, whether that danger arises from the giving out or breaking of machinery, or for. some other cause. We think the circuit court took the correct view of the statute in holding that failure of the machinery to perform its proper office might be regarded as a giving out, within the meaning of the statute.

The judgment of the Appellate Court will be affirmed.

Judgment affirmed.


author: Mr. Chief Justice Scholfield

text:
    John Reese v. W. H. Wallace.

      Filed at Springfield

      May 14, 1885.

      1. Trust—enforcement in equity—Statute of Frauds. A person accepted an agency from five mortgagees holding mortgages upon the same land, to take the necessary steps to foreclose them, and collect the money due thereon. The agent employed an attorney, who obtained a decree of foreclosure, the agent bidding off the property, in the name of the second mortgagee, for the amount due on the two first mortgages, and agreeing with the attorney that if the latter could sell the property for enough to discharge all the mortgages, he should do so. The attorney procured a party to purchase the interest of the third mortgagee and advance a sum sufficient to pay all the parties, the attorney agreeing to have the certificate of purchase assigned to him. The agent settled with the holder of the certificate, and took an assignment thereof, and after the time for redemption had expired, refused to transfer the certificate to the party who had advanced the money due to all the parties, and sought, by mandamus, to compel the master in chancery to make him a deed. Thereupon the purchaser, by bill, enjoined the proceeding, and obtained a decree for the assignment of the certificate to himself: Held, that a court of equity had jurisdiction to enforce the trust, and that the Statute of Frauds was no defence to the bill.
    2. Estoppel—by omitting to repudiate the action of an attorney before the rights of third persons have accrued, in respect to the title to land. An attorney employed by an agent to collect certain mortgage debts, after a sale for the amount due the first two mortgagees, was authorized by the agent for all the mortgagees to make a sale of the property for a sum sufficient to pay all, and did make such sale to a party who bought the interest of one of the mortgagees Whose debt was not paid by the sale, in time for making redemption, if the arrangement made by the attorney had then been repudiated by the agent. The agent afterward obtained the certificate of purchase, and on the expiration of the time for redeeming, refused to transfer the certificate, but took proceedings to compel the making of a deed to himself. It was held, that such agent, by not repudiating the sale made by the attorney before the redemption expired, and remaining silent, was estopped from asserting any right to a deed as against the purchaser from the attorney.
    Writ of Error to the Appellate Court for the Third District ;—heard in that court on appeal from the Circuit Court of Coles county; the Hon. C. B. Smith, Judge, presiding.

      Mr. James A. Connolly, and Messrs. Dunn & Connolly, for the plaintiff in error:
    Specific performance of the contract could not he had, as it was not a contract respecting land, and there was an adequate remedy at law. Parker v. Garrison, 61 Ill. 252; Bowman v. People, 82 id. 246; Pomeroy on Contracts, see. 48; Pierce v. Plumb, 74 Ill. 326.
    The evidence fails to show any authority in Favorite to make the sale, or that his act in doing so was ratified by the plaintiff in error. To make a ratification of the acts of an agent binding upon the principal, he must be fully and fairly informed of all the material facts. Matthews v. Hamilton, 23 Ill. 470; Reynolds v. Ferree, 86 id. 570; Kerr v. Sharp, 83 id. 199.
    Equity will not allow a party to hire an agent to make a contract for his principal, and then enforce the contract so obtained, against the principal. He can not rightfully acquire an interest adversely to his principal. Tewkesbury y. Spruance, 75 Ill. 187; Hughes v. Washington, 72 id. 84; Story on Agency, secs. 31, 210, 211; Davis v. Hamlin, 108 Ill. 39.
    Attorneys, without special authority, can do no more than obtain judgment, have execution issued, and receive and receipt for the proceeds. Nolan v. Jackson, 16 Ill. 272; Trumbull v. Nicholson, 27 id. 149.
    Mr. J. F. Hughes, for the defendant in error:
    On demurrer to the bill, it was contended-the certificate is personal property, and that a bill will not be entertained to specifically perform a contract about personalty,—that the remedy at law for damages is adequate and complete. The demurrer was overruled, and that decision is abundantly sustained by authority. Parker v. Garrison, 61 Ill. 252; McMullen v. VanZant, 73 id. 190.
    Reese, by his silence and acquiescence, ratified what Favorite had done. Hearing v. Butler, 69 Ill. 578.

      Reese can not be allowed to speculate at the expense of those men whose interests he undertook to secure. He could not deal with the matter of his agency on his own account. Dennis v. McCagg, 32 Ill. 443.
    The objection to the jurisdiction on the ground there is adequate remedy at law, can not be raised on the hearing, or in the Appellate Court, but must be insisted on in the answer, and no such defence is raised by this answer. Long v. Saunders, 88 Ill. 144.
    Reese may be treated as a trustee. Parker v. Garrison, 61 Ill. 254; Davis v. Hamlin, 108 id. 49.
   Mr. Chief Justice Scholfield

delivered the opinion of the Court:

Perley K. Scott executed mortgages on the lands in controversy, which lie in Coles county, in the order and for the amounts following: First, to George Wabnitz, for $1297.78; second, to Benjamin F. Nose, for $778.14; third, to Joseph W. Scott, for $354.28; fourth, to Frank M. Nose, for $205.77; fifth, to Frederick Jansen, for $184.54; and sixth, to George W. Keen, for $306.46. The mortgagor and mortgagees all resided in the State of Ohio, and the mortgagor, apart from his ownership of these lands, was insolvent. In the spring or early summer of the year 1880, the holders of the second, fourth and fifth of these mortgages,—i. e., Benjamin F. Nose, Frank M. Nose, and Frederick Jansen,—employed one John Reese, also a resident of the State of Ohio, to take their several mortgages to Charleston, in Coles county, and employ an attorney at law there to foreclose and collect them, advancing him money wherewith to pay his expenses. Accordingly, in June, 1880, Reese went to Charleston, and there, as the agent of these parties, employed John Favorite, an attorney at law, to foreclose them and collect the amounts due upon them, for a certain stipulated per cent upon the amount to be collected. It was, moreover, at the same time further agreed that Reese, who was acquainted with the' other mortgagees, should endeavor to get them to place their mortgages in Favorite’s hands for collection also, and that if they should do so, Favorite should collect the whole for a less rate per cent. Reese procured, in pursuance of this agreement, the other mortgagees to place their mortgages in Favorite’s hands for collection, and thereupon Favorite procured a decree of foreclosure upon the several mortgages, at the November term, 1880, of the Coles circuit court. On the 1st of March, 1881, the property was sold under the decree by the master in chancery. Wabnitz was present, and bid the amount due upon his mortgage. Reese then bid the amount due upon the mortgage to Benjamin F. Nose, in addition to the amount due upon the piortgage to Wabnitz, and he took a certificate of purchase to Benjamin F. Nose for the property, first paying to the master in chancery the amount bid by Wabnitz. Favorite testifies that on the night after the sale it was agreed between Reese and himself that if a purchaser for the property could be found before the time for redemption expired, it should be sold, and they would get the mortgagor to make a deed to such purchaser; that if a purchaser could be found after, and not before, the time for redemption expired, it should be sold, and they would have the party holding the certificate of purchase assign it to such purchaser, (provided, in either case, the price should justify such a course,) and that an effort should be made to effect such a sale for the benefit of the several mortgagees. This is denied by Reese, who says he intended to take title to the property in himself, in the event it was not redeemed according to law. Favorite further testifies, that in accordance with this agreement he had the property advertised for sale by certain real estate brokers, and that he otherwise made strenuous efforts, but wdiich were unavailing, to make a sale of it during the remainder of the year 1881.

In March, 1882, W. H. Wallace purchased Joseph W. Scott’s claim and mortgage, which were then assigned to him, and shortly afterwards he paid to the master in chancery the amounts then due under the sale to Wabnitz and Benjamin F. Nose, intending thereby, and thinking, that he had the right thus to redeem from the sale; and he also then paid to the master in chancery the amount due on the mortgage to Frank M. Nose, and redeemed the property from a tax sale. Some arrangement was made between the mortgagor and Keen, whereby Favorite was empowered to release Keen’s mortgage, .and this he did. It was agreed between Wallace and Favorite, the latter assuming to act for the mortgagees, that in consideration of these payments, and that Wallace would also pay Jansen the amount due upon his mortgage, the several payments so made and to be made should be accepted in satisfaction of the amounts due the respective parties on their several mortgages, and that the certificate of purchase to Benjamin F. Nose should be transferred to him, and the master in chancery make a deed directly to him. Wallace then also paid to Jansen the amount due upon his mortgage, and in all respects fully complied with his agreement with Favorite.

Benjamin F. Nose was indebted to the mother of Reese for money borrowed by him of her before this sale, the note to secure which was due on the 20th of April, 1882. The certificate of purchase was in the hands of Reese from the time it was issued by the master in chancery. On the 27th of May, 1882, Reese and he settled, and Nose assigned him the certificate of purchase in payment for the money he had advanced at the time of the sale on account of the bid of Wabnitz, and of the note due to his mother on the 20th of April. On the last day of May, 1882, Reese presented this certificate of purchase to the master in .chancery, and demanded from him a deed for the property. The master refused to make the deed. Thereupon Reese instituted a proceeding by man- damns to compel the master to execute to him a deed. The present bill is to enjoin that proceeding, and to compel the delivery of the certificate of purchase, properly assigned, to Wallace.

The objections that the case is not one wherein a court of equity has jurisdiction, and that the plea of the Statute of Frauds is a defence, are made, as we conceive, under a misconception of the real purpose of the bill. The case is not one simply to enforce specific performance of an ordinary contract, but to enforce the execution of a trust by a trustee, and hence neither objection is tenable. (Weaver v. Fisher, 110 Scholfield. 147; Davis v. Hamlin, 108 id. 39.) Eeese accepted an agency, first, as to the collection of the second, fourth and fifth mortgages, beyond any question, and the evidence, we think, authorizes the conclusion that he also acted in that capacity as to the other three, for he procured them to be sent to Favorite for collection, and fixed, by contract, the terms upon which they were to be collected. He had no interest in either of these claims as owner, but was acting as the paid agent of the mortgagees when they were placed in the hands of Favorite for collection. There is no evidence that this agency terminated when Favorite was employed,— on the contrary, it is shown that he continued to act as agent, and there is evidence of admissions made by him, after the sale, which strongly corroborates the evidence of Favorite that an, agreement was made between them, on the night after the sale, ‘that the property was to be sold, if possible, for the benefit of all the mortgagees. Thus, Wabnitz says he was present, and heard Favorite say to Eeese, on the day of sale, that he could find a purchaser who would pay all the mortgages on the land. Jansen says: “When he came back, after the sale, he said he had bid the land in at Ben Nose’s claim,- and said there was no other bid except for Ben Nose’s and Wabnitz’ claims. He said, keep cool,—there might be some chance of getting my money. Afterwards he said I would get my money sure, now,—that Favorite had written him it was all paid in. ”

We deem it unnecessary to discuss the evidence at length. It is clear, beyond cavil, that Reese was paid by Jansen to act as his agent in procuring the collection of his mortgage, saying nothing of his obligations to the others. Jansen gave him, and he accepted from him, ten dollars on that account. His duty to Jansen was just as imperative as it was to Benjamin F. Nose. Without betraying his trust, it is impossible that he could change his agency into a private speculation. The arrangement which Favorite swears he did make was precisely what his duty required he should make. All that Benjamin F. Nose was entitled to have, was his money by the time the period of redemption expired. Scott and Jansen, and Frank M. Nose, were each entitled to redeem, but if the arrangement testified to by Favorite could be effected, and which was effected through the sale to Wallace, that was unnecessary, because thereby each gets what he is entitled to have. After Wallace purchased from Joseph W. Scott, he was equitably entitled to take steps to redeem, and the evidence shows that Reese knew of this purchase, and of the arrangement made between Favorite and Wallace, long enough before the time of redemption expired to have enabled Wallace, had Reese promptly repudiated it, to have taken steps to save himself. But knowing all this, he remained silent, and did not, until the time for redemption had passed by, inform either Wallace or Favorite that he intended to claim the property himself. The doctrine of equitable estoppel is applicable. He remained silent when duty required him to speak, and equity will not, therefore, now allow him to speak. In no view is Reese entitled to hold this certificate of purchase. Fidelity to his trust requires that it shall be held to be the property of Wallace, and the decree, therefore, requiring him to assign and deliver it, is right.

The judgment of the Appellate Court is affirmed.

Judgment affirmed.


author: Mr. Justice Mulkey

text:
    Clemens Klein v. The People of the State of Illinois.

      Filed at Ottawa

      May 15, 1885.

    1. Cbiminal law—alibi. Where the proof clearly shows the commission yf a robbery, and the defendant is identified as the guilty party by two witnesses, and an alibi is relied upon in defence, which is not very satisfactorily proved, giving allowance for differences in time and the opinions of witnesses •of the time when the offence was committed, and owing to the proximity of ■the place where the alibi is shown to the place where the robbery occurred, a. judgment on a verdict finding the defendant guilty will not be reversed, i 2. A defendant, to establish an alibi, must not only show, he was present at some other place about the time of the alleged crime, but also that he was at such other place such a length of time that it was impossible for him to have been at the place where the crime was committed, either before or after the time he was at such other place.
    3. Same—robbery—sufficiency of proof of force. On the trial of one for robbery, the prosecuting witness testified to the taking from her a hand-bag containing money, and that the hand-bag was taken with such force that it bruised her arm, and it was lame for several days: Held, that this testimony most clearly showed that the taking was by force, and that the act was a robbery.
    4. New tbial—newly discovered evidence. Where affidavits relied on for a new trial in a criminal case as showing newly discovered evidence, contained much irrelevant matter, and such facts as had a bearing on, the case were not of a conclusive character, and cumulative, merely, it was held, no error to refuse a new trial on them.
    5. Where the facts relied on as newly discovered evidence on a motion for a new trial, are such as the party or his counsel, by ordinary prudence and diligence, should have learned before the trial, and proved, and no sufficient excuse is shown for not proving them, a new trial will not be granted.
    Writ of Error to the Criminal Court of Cook county; the Hon. Kirk Hawes, Judge, presiding.
    Messrs. Moore & Purnell, for the plaintiff in ejror.
    Mr. George Hunt, Attorney General, for the People.
   Mr. Justice Mulkey

delivered the opinion of the Court:

On the 17th of January, 1884, Clemens Klein, plaintiff in error, impleaded with Henry Tiederman, was convicted in the Criminal Court of Cook county, on a charge of robbery, the jury fixing the time of his confinement in the penitentiary at eight years. Motions for a new trial and in arrest of judgment having severally been made and overruled, the court, on the 4th of February following, entered final judgment upon the verdict, to reverse which the accused has brought the present writ of error.

Eva Reed, the prosecuting witness, testified, in substance, that in the afternoon of October 11, 1883, between the hours of one and two o’clock, while walking east on Garfield avenue, in the outskirts of the city of Chicago, she saw both defendants standing near an alley, in front of her, and on the same side of the street she was walking; that she noticed no one about there but them, and as she came near them they were looking across the street as if hunting for some number of a house, one of them remarking, “There is 239 across the street; ” that upon reaching them, they separated, so that she had to pass between them, and in doing so, Tiederman grabbed her hand-bag with both his hands and pulled it off the arm on which it was hanging; that upon thus jerking it from her arm, they both ran off, Tiederman taking it with him; that it contained her pocket-book, in which was some change, and seven dollars in United States Treasury notes and National bank notes, belonging to her; that the handbag was taken with such force that it bruised her arm, and that it was lame for several days. On cross-examination she stated further: “It was my impression that the handle was broken, or the ring that fastened on the handle, and that let it off my arm. I am positive defendant Klein -is one of the men who robbed me. I have no doubt about it. * * * I had a good opportunity to see him as I walked from the corner of Orchard street. * * * I was not very much frightened when I ran. I called out, ‘Police! Stop thief!’ They looked over their shoulders as they ran, and I saw their faces. I reported at the police station. At four o’clock I saw defendant Klein, and said he was one who robbed me.”

George Hopkins, a boy twelve years of age, testified that he was, at the time of the occurrence, playing cricket in a back yard near by; that he heard Miss Eeed scream, ran to the alley, and saw both defendants running toward Center street, through the alley; that they were running toward him, and ran past him; that he saw defendant Klein at the police station next day, and knew him as soon as he saw him.

These witnesses are in no manner impeached. The defence, to the clear case thus made by the People, is an alleged alibi. The testimony of five witnesses, besides the accused, is relied on to establish it. The witnesses are, John Quinn, Nora Quinn, Minnie Eeinkey, Kittie Arnold, and Charles Tennis. The claim of the accused is, that at the time the offence is alleged to have been committed, namely, some time between one and two o’clock P. M., he was in the saloon of witness John Quinn, at No. 167 Larrabee street. This witness swears that Klein came to the saloon at one o’clock, exactly. No other witness fixes the time of his arrival there, though the accused himself testifies he was there at one. Minnie Eeinkey swears to have seen Klein, in company with Tennis, going south on Larrabee street, a little after one o’clock, and if this' is true, Klein could not have been at the saloon at that hour, as stated by John Quinn and the accused. The more important inquiry, however, relates to the time when Klein left the saloon. Nora Quinn, who was at the time tending bar for John Quinn, swears that she saw defendant there from half-past one o’clock until after two. John Quinn left the saloon, as he testifies, at half-past one, and consequently he could not know, nor did he pretend to state, when the accused left. Neither Minnie Eeinkey nor Kittie Arnold saw him at the saloon at all, and knew nothing as to the time of his leaving. The only other witness, then, outside of the accused himself, is Tennis, who testified: “We left the saloon near two o’clock. I looked at my watch at 1:40, and soon afterward we left. ” The plain inference from the testimony of this witness is, they left some time before two o’clock.

Of the five witnesses relied on to establish an alibi, but one of them states the accused was at the saloon as late as two o’clock; one of them left the saloon a half hour before that time; two do not know even of his being there, and the remaining one swears, in effect, he left there before that time. ¡Now, when we add to this the proximity of the saloon to the place where the crime was committed, the distance between the two places being fixed by a police officer at three-quarters of a mile, and then make reasonable allowance for differences in time-pieces and in opinions respecting the time, the proof of an alibi is anything but satisfactory. So far as the case made by the People is concerned, the particular hour at which the robbery occurred is not important. That it did occur is not questioned, and the prosecuting witness herself may have been mistaken as to the exact time, without at all affecting her testimony in other respects. Supposing the offence to have occurred twenty or thirty minutes later than she supposed, it is manifest the defence of an alibi has utterly failed. To have made this defence anything like complete, the accused should have gone a little farther, and accounted for himself at least for a short while after two o’clock, so as to have covered differences in time-pieces, and in opinions of witnesses in respect to the time. It is a significant fact that outside of the accused himself, no witness. pretends to account for the whereabouts of the accused immediately after two o’clock. But waiving all these considerations, and assuming the proof in support of the alibi was twice as strong as it is, we would still not feel at liberty to disturb the conviction, for, assuming the alibi was clearly proven by the defendant’s witnesses, the fact would still remain that the accused is as clearly shown to be guilty by the testimony of the People’s witnesses, thus leaving an irreconcilable conflict in the testimony, which the jury alone had the right to settle. It has been so often said, in effect, by this court, that it is the peculiar province of the jury to pass upon the credibility of witnesses, and to determine on which side of the controversy the truth lies in case of an irreconcilable conflict between witnesses, it is hardly necessary to repeat it here. It is the fundamental principle that underlies the right of trial by jury, and any substantial departure from it would necessarily impair the right itself.

Some complaint is made of the People’s instructions, but we see no substantial objections to them.

The point is also made, that the evidence fails to show the taking was forcible, force being a necessary element in the crime of robbery. We are unable to perceive the slightest foundation for this claim. The prosecuting witness states, as we have already seen, “the hand-bag was taken tvith such force that it bruised my arm, and it was lame for several days." In the face of this unequivocal statement, it is difficult to conceive upon what theory counsel can maintain there has been any failure to make out the case, so far as the question of force is concerned. There is clearly nothing in the point.

The only remaining matter to be noticed is the refusal of the court to grant a new trial on the ground of newly discovered evidence. The motion for a new trial, so far as it is based upon alleged newly discovered evidence, is supported by numerous affidavits. Three of the affiants, including the accused, were witnesses for the defence; three others were relatives of the defendant, and besides these there were several others. We can not stop to consider these affidavits in detail. -Much of the matter contained in them is irrelevant and unimportant, and consequently affords no ground for a new trial. As to such facts in the affidavits as have a bearing on the case, none of them are of a conclusive character,. and are cumulative, merely. As to others, it is apparent, from their very nature, that the defendant’s counsel must, if they really existed, have known them, or might have known them by the exercise of even a small degree of prudence or skill. For illustration, it is stated in the affidavit of the accused that since the trial he has discovered from his brother-in-law, Alfred Framhold, that the evidence on behalf of the People, at the trial, to the effect that the saloon of John Quinn was only about three-quarters of a mile from the place where the offence was committed, is untrue,—that as a matter of fact it is a mile and a third, instead of three-quarters of a mile. This statement, in the light of the record before us, if-accepted as true, shows a degree of culpable negligence or ignorance on the part of the counsel for the accused that is probably without a parallel. The record shows the indictment was returned on the 3d of November, 1883, the offence having been committed on the 11th of the previous month. As stated by the accused himself, on the day after the commission of the crime he retained, as an attorney, John Waggoner, who acted for him up to the 12th of December, when he declined to act for him any longer, because the defendant was unable to pay him his fees. He then employed Miss Kate Kane, as she testifies, and she continued to act for him till she was superseded by Mr. Moore, who is still his counsel. It thus appears that from the date of the crime up to the time of filing these affidavits the accused has never been without counsel, and has had, altogether, three engaged in- the ease, and although it further appears that during' this time there have been two trials of the cause with no other defence than that of an alibi, yet a new trial is now asked on the ground that the defence has been taken by surprise in respect to the distance from the saloon to the place of the crime! To say that this was not known, or even that it was not particularly investigated, is, in view of the defence relied on, to impute to the defendant’s counsel, and even to the accused himself, a degree of stupidity and inexcusable negligence that taxes credulity to its utmost extent to admit for a moment. The very conception of an alibi is, per se, a conception of the distance between the scene of the offence and the whereabouts of the accused at the time it was committed. The whole strength of an alibi, in every case, depends entirely upon such intervening distance. To say, therefore, that it was not thought of, is simply absurd, and to say that because the accused was confined in jail the necessary evidence of the distance could not be had at.either of the trials, is equally unreasonable and inadmissible, for it. is manifest that proof of this fact could easily have been made while the trial was going on; and to file an affidavit, as has been done in this case, showing that the accused relied upon the testimony of the People upon this, the most important of all the facts in the defence, is but to publish the inexcusable negligence of the counsel conducting the defence. And the fact that the counsel having charge of the defence at the last trial had recently been called into the case, is no excuse whatever for relying on the People’s testimony in respect to this important fact, for, as already stated, proof of it might easily have been obtained while the trial was going on, and, as has already been shown, it could not have escaped the attention of counsel without overlooking the alibi itself, which would have been to overlook the only defence relied upon. But to show how utterly untrustworthy this entire claim is, it is only necessary to advert to the fact that the record shows that no proof of the distance between the saloon and the place of the crime was introduced by the People until after the defence had closed! How did the defence expect to make out the alibi without showing the distance between the two places ? It surely did not devolve on the People to make out this defence, and it is absurd to talk about relying on them to do it.

It is also alleged in the affidavit of the accused “that - for five years last past he has followed the trade of a paperhanger, in Chicago, and bore a good name and reputation for honesty, as appears by affidavits filed,—that all these facts are true, and 'will be proved if a new trial is given him. ” Whether the defendant’s good reputation is a newly discovered fact, does not appear. However this may be, no reason whatever is assigned why proof of it was not made on the trial. Whether the fact, which he admits himself, of his having been previously convicted under an indictment for burglary, and sent to the house of correction for thirty days, had anything to do with the failure tó offer evidence of good character, is a matter of mere conjecture. At any rate, it was not offered, and, as already stated, the failure to do so is wholly unexplained. While it appears from his affidavit, as above shown, that for the five years last past he followed the trade of a paper-hanger, yet in his testimony he says at the time the offence was committed he was a street car driver!

It is useless to pursue this matter further. In any view that can be taken of the ease made by these affidavits, when considered in connection with other parts of the record, it is singularly vulnerable, and affords no ground for granting a new trial.

The judgment will be affirmed.

Judgment i#rmeiZ.