text:
    Daniel H. Caswell v. Ann M. Caswell.

      Filed at Springfield March 23, 1887.

    1. Removal op cause to Federal Court—non-resident defendant in suit to set aside decree for divorce. On bill filed by a wife against her husband, to set aside a decree of divorce obtained by the latter through fraud, he will not have the right to have the cause transferred to the Circuit Court of the United States, on the ground of his being, at the time, a non-resident of the State. The statute of the United States providing for the removal of causes to the Federal Court has no application to such a case.
    2. Bill to impeach decebe for fraud—whether it will lie. Where a decree of divorce has .been obtained by fraudulent means and false representations as to the parties’ domicile and residence, which gave the court fcn apparent jurisdiction in a case where there was in fact no rightful jurisdiction, the injured party may, within a resonable time after discovery of the fraud, have such decree set aside, on bill filed to impeach the same.
    3. In this case, a husband residing in this State sent his wife to her father’s home, in New York, on a visit, and prevented her return by fraudulent misrepresentations. While the wife was so absent, the husband filed his bill for a divorce in a different county from that of his domicile, and had publication of notice made to his wife, on his false affidavit that she was a non-resident of the State, and procured a decree of divorce on his own false testimony as to his residence and the conduct of his wife, which facts he concealed from her. It was held-, that the wife, on learning the facts, had the right to impeach the decree of divorce by a bill for that purpose, and have the same set aside, although the husband had in the meantime been again married.
    4. Limitations—laches—decree on constructive notice—when it will become final, in respect to the suing out of a writ of error. A decree against the defendant in a chancery case, where there is no personal service, but only notice by publication, is liable to be opened at any time within three years, on the application of the defendant. After the expiration of three years such decree will become final, the same as if obtained in a case where there is personal service. The defendant will have five years from its becoming thus final in which to prosecute a writ of error or file a bill of review. Such a decree, when it shall become final, is not any more so than in a case of personal service.
    5. Same—when the statute will begin to run. Where there is a cause of action arising from a fraud, the Statute of Limitations will not begin to run, in equity, until the discovery of the fraud by the use of reasonable diligence.

      6. Same—fraudulent concealment—as affecting the running of the statute. Where a husband, after fraudulently procuring a decree of divorce from his wife, fraudulently conceals from her the facts, which would enable her to find where such divorce has been procured, and take steps to have it set aside, she, under our statute, will have five years after discovery of her cause of action in which to file her bill to impeach such decree for fraud.
    7. So where the husband, in 1869, fraudulently obtained a decree of divorce in this State against his wife, whom he had sent out of the State, and after the filing of his bill wrote to her that he was going to Mexico, to- be gone some time, and some time after the decree wrote to her that he had obtained a divorce in the State of Indiana, which was false, and she, after j'ears of investigation, learned the real facts in May, 1883, and it appeared that she was poor, and had to labor to obtain the means for her support and with which to prosecute her inquiries, and she filed her bill, about seven months after learning the fact of the divorce, to impeach and set aside the decree for fraud, it was held, that under the circumstances she was not chargeable with laches in filing the bill.
    Appeal from the'Appellate Court for the Third District;— heard in that court on appeal from the Circuit Court of Piatt county; the Hon. C. B. Smith, Judge, presiding.
    Mr. Charles W. Thomas, for the appellant:
    Defendant’s plea setting up section 19, chapter 22, of the Revised Statutes, as a bar, ought to have been sustained. The decree, after three years, ought to be held final. Lyon v. Robbins, 46 Ill. 276; Lawrence v. Lawrence, 73 id. 577; Southern Bank v. Humphrey, 47 id. 247.
    That the remedy given the defendant to correct an erroneous decree, by this section of the statute, is exclusive, and supersedes all common law remedies, reference is made to Ward v. Severance, 7 Cal. 126; Roberts v. Landecker, 9 id. 262; Fuller v. Edings, 11 Rich. 239; Butler v. State, 6 Ind. 165; Victory v. Fitzpatrick, 8 id. 281; McCormack v. Railroad Co. 9 id. 283; Cole v. Muscatine, 14 Iowa, 296; Hagan v. Essex County, 12 Cush. 475; Babb v. Mackey, 10 Wis. 371; Wooley v. Wooley, 12 Ind. 663.
    The person of defendant in the divorce suit was not where the process of the court could reach her. She was therefore a non-resident. After desertion, the husband’s domicile is not that of the wife.
    As the court had jurisdiction to render the decree of divorce, and as others now have an interest in the stability of the decree, it should not be set aside after other relations have attached on the faith of the same. Greene v. Greene, 2 Gray, 361; Horner v. Fish, 1 Pick. 435; Peck v. Woodbridge, 3 Day, 30; Gelston v. Codwise, 1 Johns. Ch. 195; Parish v. Parish, 9 Ohio St. 534.
    As to the distinction between cases involving fraud in giving jurisdiction, and fraud committed after the jurisdiction is acquired, see Edson v. Edson, 108 Mass. 591; Railroad Co. v. Holbrook, 92 Ill. 297; Greene v. Greene, 2 Gray, 361.
    The court should have transferred the cause to the United States Circuit Court. The petition was in due form, accompanied by a proper bond. Empire Co. v. Richards, 88 Ill. 404; Gaines v. Fuentes, 92 U. S. 10; Dillon on Removal of Causes, sec. 76.
    There was too great delay in filing the bill, where the effect is to bastardize innocent children, the fruits of the second marriage. Dunn v. Dunn, 4 Paige, 425; Bishop on Marriage and Divorce, sec. 751.
    Mr. Charles Hughes, and Mr. S. R. Reed, for the appellee:
    A decree of divorce obtained by fraud is void, has no binding effect, and may be impeached and set aside, even though a subsequent marriage by one of the parties may have been consummated, and children born by such marriage. Adams v. Adams, 51 N. H. 388; Cumstock v. Adams, 23 Kan. 513; Edson v. Edson, 108 Mass. 590; Graves v. Graves, 36 Iowa, 310; Rush v. Rush, 46 id. 648; State v. Whitcomb, 52 id. 85; Borden v. Fitch, 15 Johns. 12; Crouch v. Crouch, 30 Wis. 667; Johnson v. Coleman, 23 id. 452; True v. True, 6 Minn. 458; Jackson v. Jackson, 1 Johns. 424; Lawrence v. Lawrence, 73 Ill. 577; Bishop on Marriage and Divorce, (6th ed.) sec. 753, p. 637.

      Lapse of time is no bar to bringing suit to impeach a .decree including divorce decrees obtained by fraud, when cause is shown for the delay, and that the party seeking to impeach such decree is not guilty of laches. But the proof must be clear that the party is entitled to the relief prayed for. Adams v. Adams, 51 N. H. 388; Sloan v. Sloan, 102 Ill. 581; Oakley v. Hurlburt, 100 id. 204; Lequatte v. Drury, 101 id. 81; Furlong v. Riley, 103 id. 631; Warden v. Cornell, 105 id. 178; Collier v. Beers, 106 id. 150; Cleaver v. Green, 107 id. 67; Boyden v. Reed, 55 id. 458; Castner v. Walrod, 88 id. 171; Johnson v. Coleman, 23 Wis. 452.
    The Statute of Limitations will not begin to run until the discovery of the fraud complained of, especially where the adverse party conceals the fraud. McIntosh v. Saunders, 68 Ill. 131; International Bank v. Jenkins, 104 id. 155; Henry County v. Drain Co. 52 id. 301; Wear v. Skinner, 46 Md. 257; Railroad Co. v. Mayo, 67 Maine, 470; Rev. Stat. chap. 83, sec. 22.
    The husband can not treat his wife as a non-resident when he sends her out of the State, and she is absent by his will or procurement, and not by her own. Her residence or domicile is the same as his. Babbitt v. Babbitt, 69 Ill. 277; Kennedy, v. Kennedy, 87 id. 250; 2 Bishop on Marriage and Divorce, (6th ed.) sees. 118, 125, 126, 753c.
    Service on defendant, by newspaper notice, fraudulently given, though in compliance with the statutes, ought to be considered as no notice at all. Adams v. Adams, 51 N. H. 338; Edson v. Edson, 108 Mass. 590; Graves v. Graves, 36 Iowa, 310; Rogers v. Coleman, 3 Am. Dec. 733; Robison v. Ward, 8 Johns. 86; 1 Story’s Eq. see. 252, note a.
    Under the laws of Illinois, on the question of jurisdiction in divorce eases, we submit thata party applying for a divorce must bring his suit in the county where he actually resides. Rev. Stat. chap. 40, sec. 5; Way v. Way, 64 Ill. 406; Babbitt v. Babbitt, 69 id. 277.
   Mr. Justice Sheldon

delivered the opinion of the Court:

This was a bill in the nature of a bill of review, brought by Ann Mary Caswell, against Daniel H. Caswell, in the circuit court of Piatt county, in this State, on December 22, 1883, to impeach and annul a decree of divorce in favor of the latter, against the former, entered at the September term, 1869, of said court, on the ground of its having been fraudulently obtained. Upon final hearing, on bill, answer, and proofs taken by both parties, the circuit court decreed the relief prayed. On appeal to the Appellate Court for the Third District, the decree was affirmed, and the defendant appealed to this court.

The bill in the divorce suit of Daniel H. Caswell, against Ann Mary Caswell, set forth the marriage of the parties in 1862; that the complainant was a resident of Piatt county, in this State; that he lived and cohabited with the defendant until December 10, 1865, when she deserted him, and had, for more than two years past, persisted in her desertion, wherefore he prayed for a divorce. Attached to the bill was the affidavit of the complainant, that Ann M. Caswell was a non-resident of Illinois, and a resident of the State of New York. There was no service of summons on the defendant in that suit, but only notice by publication. There was no appearance of the defendant, and the decree was by default. There was a reference to the master, to take proofs, whose report contained the testimony of the complainant, of the marriage, of living together as man and wife until December 10,1865, when defendant left complainant without any cause or provocation, and had continued to remain away, separate and apart from him, ever since; that she left him against his will; that he lived in Piatt county when the bill was filed; that it was about two years since he had heard from the defendant, and that he did not then know where she was. Also the testimony of one Bixby, that the parties lived together until December, 1865; that he always understood that complainant’s wife had deserted him; that she had lived separate and apart from him since she left him, in December, 1865. This is substantially all that was shown by the report. Its date was February 18, 1869.

The testimony in the present case shows, without any attempt at.contradiction, that the comjDlainant and the defendant took up their residence at Cairo, in this State, about the month of October, 1866, and lived there together, keeping house, until in March, 1867, when the defendant sent the complainant on a visit to her parents, in Brooklyn, New York; that he desired her to' remain there until after her confinement ; that she reluctantly consented to go, but did not want to remain there; that he promised to send for her when proper for her return; that in her correspondence with him she was continually urging him to let her return, and he refused to let her do so; that a constant correspondence was kept up between the parties, as shown by eighty-one letters exhibited in evidence, from defendant to complainant, between the dates of March 26, 1867, and December 6, 1868, and which are corroborative of the foregoing testimony.

Appellant made two applications, in the circuit court, to remove this cause to the United States Circuit Court for the Southern District of Illinois, the first being based on section 2 of the act of Congress of 1875; the second, on the act of 1866,—third subdivision of section 639. These sections may be found on pages 1860 and 1864, Starr & Curtis’ Statutes. The court denied the applications, because the sum of $500, exclusive of costs, did not appear to be involved in the controversy. This ruling of the court, it is insisted, was erroneous. It is said, the statement of the petition tha.t there w*as such a sum involved, should govern. Although that be the statement of the petition, it manifestly appears not to be true from the nature of the proceeding, it being but to set aside a mere decree of divorce, and the matter in suit not being measureable by dollars and cents. There was not the money interest even of costs involved in the divorce decree, that decree ordering that the complainant should pay the costs. These statutes, in our opinion, do not apply to such a case as this, and the applications were properly denied.

It is insisted there was error in not sustaining the plea of the defendant setting up section 19, chapter 22, of the Eevised Statutes, as a bar to the suit. That section provides, that within three years after a decree in a case of notice by publication, and not personal service, the defendant, on petition, may appear and answer the complainant’s bill, and thereupon such proceedings shall be had as if the defendant had appeared in due season and no decree had been made; and “the decree shall, after three years from the making thereof, if not set aside in the manner aforesaid, be deemed and adjudged confirmed against such non-resident defendant.” It is contended that the remedy which is hereby provided was all the remedy which the complainant had in this case,— that at the end of three years, any decree so rendered upon notice by publication, becomes, by the express provision of law, final and conclusive, unless the defendant appears in the same case and asks to be let in to defend. The contrary view has been taken by this court in Lyon v. Robbins, 46 Ill. 276, and Southern Bank of St. Louis v. Humphreys, 47 id. 227, where it was held, that a decree thus rendered, where there was notice by publication, and not personal, the decree was provisional, only, and not final, in fact, until at the expiration of three years, and that the defendant had five years after it thus became final in fact, within which to prosecute a writ of error or file a bill to impeach it,—that is, as we understand, to place the decree, at the end of three years, on the same footing of a decree in a case of personal service, and not give to it any higher effect. Those cases but simply announce the general rule as to when bills of review must be filed to impeach a decree. In Sloan v. Sloan, 102 Ill. 581, the same general rule is repeated, with recognition of there being exception thereto.

There is no doubt, from the evidence, that the decree of divorce was fraudulently obtained. It is insisted, however, that if that be so, all of fraud that there was, was in obtaining the decree by false evidence, and that for such a fraud a judgment or decree can not be impeached in a separate and independent proceeding, (citing Greene v. Greene, 2 Gray, 361, among cases as so deciding,) and admitting the rule to be otherwise where the fraud complained of is a fraud whereby the court was given a colorable jurisdiction of the defendant’s person, where there was not real jurisdiction of it,—and it is denied that there was any fraud of this latter kind in the case. Edson v. Edson, 108 Mass. 590, illustrates the distinction between these two classes of cases,—of fraud in giving jurisdiction, and fraud committed after the jurisdiction had, in fact, attached. In this last named case, the court sustained a petition filed to set aside a decree of divorce in a case- where there was no domicile of the plaintiff to give the court jurisdiction, but a fraudulent representation that there was such domicile. In speaking, there, of Greene v. Greene, supra, which had been cited adversely to the petition, the court say: “Strictly speaking, the decision is an authority only for the proposition that a decree of divorce can not be called in question, or invalidated, on the ground of fraud in its procurement, in a separate and independent libel, subsequently brought, between the same parties, when it appears that the first decree was entered after due notice to the adverse party, followed by an adjudication upon evidence offered in support of the allegations of the libel. To this extent there can be no doubt that the decision is in harmony with sound principle, and with the adjudicated cases.” And the court goes on to distinguish the case then in hand, saying the petition did not seek to set aside a decree rendered against the defendant in a suit of which the court had full jurisdiction, of the pendency of which she had due notice, but in a proceeding of which the court had no jurisdiction, but only an apparent jurisdiction, founded on a false allegation of domicile.

We are of opinion that there was fraud, here, in both the respects named,—fraud in the giving of false evidence, and fraud with respect to giving jurisdiction. At the time of the institution of the divorce proceedings and obtaining the decree of divorce, the defendant was not a non-resident of the State of Illinois, but was a resident of the State. She was absent from the State temporarily, only, where her husband had sent her, willing and desirous to return to him in this State, and being prevented from so doing by himself. In such case the husband can not treat his wife as a non-resident, but her residence and domicile are the same as his. Bishop on Marriage and Divorce, (6th ed.) secs. 118, 125, 126, 753; Babbitt v. Babbitt, 69 Ill. 277; Kennedy v. Kennedy, 87 id. 250. Yet the complainant, by his false affidavit that the defendant was a non-resident of this State, and a resident of the State of New York, induced the court to take cognizance of the case, upon notice to the defendant only by publication, where, under.the fact as existing, there could have been jurisdiction of the person of the defendant only upon personal service of summons upon her, or of a copy of the bill, together with a notice of the commencement of the suit. Furthermore, under the statute, a party applying for a divorce must bring his suit in the county where he resides. (Rev. Stat. chap. 40, sec. 5; Way v. Way, 64 Ill. 406; Babbitt v. Babbitt, 69 id. 277.) The proceeding was in Piatt county. The complainant represented in his bill, and in his testimony, that he was a resident of Piatt county at the time the bill was filed. We are satisfied, from the proof, that he was not then a resident of Piatt county.

We find, then, that there was no jurisdiction of the person of the defendant in the divorce- suit; that by the perpetration of a fraud by the complainant therein, there was given apparent jurisdiction over the defendant; that the notice by publication was not due and legal notice, arid should be taken as no notice,—so that the decree was rendered against the defendant without notice of the suit or opportunity to defend against it. We think the appellee is entitled to the relief she asks, unless she is barred of her suit by the delay in bringing it. The divorce decree having been at the September term, 1869, of court, and the bill, here, not filed until December 22, 1883, there would seem to have been too long a delay, at first blush; but we think it to have been sufficiently accounted for. Appellee did not learn the fact of the existence of the divorce decree until in May, 1883, and there is nothing of the want of due diligence attributable to her in not sooner discovering its existence. Not knowing before that there was such a decree, she could not, of course, before then have taken any steps to have the decree set aside.

As has been observed, the constant, frequent correspondence by letter was kept up between appellant and appellee, until December 6, 1868. Appellant on that day,—six days after the filing of his bill for divorce,—wrote a letter to appellee, dated Taylorville, in Christian county, Illinois, saying he was about to start for Mexico; thought he would do well and come home with some money in the spring; says he feels bad about going, and she need not write until she heard from him, as he does not know the name of the place he was going to; he remits $5, and says he can not spare more, but a person named was owing him $20, and he would direct him to send it to appellee; thinks appellee can get along with the $5 he sends and the $20, until she hears from him again. She is asked not to feel bad 'in not hearing from him, and to take good care of the baby,—a daughter having been born to appellee on September 29, 1867. On January 14, 1869, appellant was married, in Ohio, to one Louisa C. Broadwell. He says that after the decree he was re-married to this woman. After December 6, 1868, appellee heard nothing from appellant until October 22, 1869, when he wrote her a letter, dated Evansville, Indiana, October 22, 1869, saying he is prepared to let her know the reason of his long silence was absence from the country. Also, that by the laws of that State he had procured a divorce from her, on the ground of incompatibility of temper and disposition, and thereafter held himself free from her forever; that he would go to Mexico, and she need not expect to see or hear from him again. Thereupon appellee instituted search throughout the State of Indiana, and ascertained that no such divorce had been granted by any court of that State. By this, appellee learned that she had been told an untruth, and she was justified in relying upon it as such, and in. thinking that no divorce had been obtained. Appellee then set on foot, search and inquiry to find appellant, and from that time on not only used due diligence,—constant and persistent in such search and inquiry,—but her efforts in that direction were extraordinary. Without going into detail, we will say,, that she had made declaration she would find appellant if he was on the face of the earth, and greater efforts for the making good of that assertion hardly could have been made by a woman in her situation, than were made. Her diligent endeavors were finally crowned with success, in 1881, in finding that a person of appellant’s name was residing at Nashville, Tennessee. She wrote to him, and received in reply a letter from him, there, of the date of September, 1881, in which he expresses surprise that appellee should address him as her husband, and states that she well knows that he procured a divorce from her some twelve years ago. This was evidently a reference to his letter of October 22, 1869, from Evansville, Indiana, in which he said he had procured a divorce from appellee, in that State, and was but a repetition of the same untruth of that letter. She had a right to so regard it, and it afforded no clue whatever to lead her to the discovery of this decree of divorce. In May, 1883, appellee went, herself, to Nashville, to see appellant, and there, May IS, 1883, as she says, she, for the first time, obtained the knowledge of the decree of divorce, never having before had any intimation or suspicion of such a decree, more than was afforded by these two letters from appellant, of October 22,1869, from Evansville, Indiana, and of September, 1881, from Nashville, Tennessee.

It is said, that diligence in search for the appellant was of no moment,—that the search and inquiry should have been for the decree. But having no information as to the decree, and there being nothing to put her upon her inquiry respecting it, there was no duty incumbent upon appellee in that respect. The finding of appellant did prove to be the means of the discovery of the decree.

Where there is a cause of action arising from a fraud, the Statute of Limitations will not begin to run, in. equity, until the discovery of the fraud. (2 Story’s Eq. Jur. sec. 1521 a.) And section 22, chapter 83, of the Revised Statutes,—of our Statute of Limitations,—provides: “If a person, liable to an action, fraudulently conceals the cause of such action from the knowledge of the person entitled thereto, the action may be commenced at any time within five years after the person entitled to bring the same, discovers that he has such cause of action, and not afterwards.” There is that in this case which looks toward such fraudulent concealment. Appellant certainly misled appellee, by his falsehood to her, that he had obtained a divorce in the State of Indiana.

We are satisfied no laches was imputable to appellee up to the time when she discovered the existence of the decree, in May, 1883. Appellee should have acted, thereafter, with reasonable promptness in her application to set aside the decree. She was not required to take instant action. She should have been allowed a reasonable time within which to bring her bill. She lived in a foreign State. She was a poor person, of a delicate constitution, sick much of the time, dependent on her own labor, with some assistance from her father, for the support of herself and child, and had expended considerable in the search for appellant. She was at Nashville, Tennessee, when she found out such a decree had been rendered. Remaining there awhile, she returned to her home in Brooklyn, New York. Some time was occupied in earning and raising the means necessary for the bringing of her suit. She then came to the State of Illinois, and on December 22, 1883,— seven months and seven days after her knowledge of the decree,—she filed the present bill. Under the circumstances we do not think there was any unreasonable delay in bringing the suit, and we are of opinion that its maintenance should not be held to be barred by the lapse of time which appears here.

The facts of appellant’s re-marriage, of there being children thereof,—although we dp not see in the record proof of such children,—and of the hardship which will result to innocent persons from setting aside the decree of divorce, are dwelt upon as objections to the granting of such relief. Such ill consequences we can appreciate, and must regret; but yet they do not form reason sufficient for 'a denial of the exercise of the court’s power to vacate such a decree obtained by fraud, as has often been determined. Crouch v. Crouch, 30 Wis. 452; Rush v. Rush, 46 Iowa, 648; Whitcomb v. Whitcomb, id. 437; Edson v. Edson, supra; Bishop on Marriage and Divorce, secs. 751, 753 a; True v. True, 6 Minn. 458; Comstock v. Adams, 23 Kan. 513; Adams v. Adams, 51 N. H. 388.

The judgment of the Appellate Court will be affirmed.

Judgment affirmed.

Mr. Justice Scott, dissenting.


source: Caselaw Access Project

author: Mr. Justice Magruder

license: Public Domain

text:
    Margaret A. Haldeman et al. v. The Massachusetts Mutual Life Insurance Company.

      Filed at Springfield March 23, 1887.

    1. Usury—commissions paid to loan agent. The payment of commissions to a loan agent or broker, by the borrower, for procuring a loan of money, and afterward a commission for obtaining a renewal of the loan, in addition to the full legal rate of interest, will not render the transaction usurious, when the lender has nothing to do with the commissions paid.
    2. Same—reservation for attorney's fee. A loan of money at the highest rate of interest allowed- by the statute, secured by a mortgage, will not be usurious, merely from the fact of a stipulation in the mortgage that a solicitor’s fee of $100 shall be taxed as costs in case a bill should be filed to foreclose.
    3. Attorney’s fee—taxable as costs. Under a clause in a mortgage providing that the sum of $100, solicitor’s fee, “shall become due and payable immediately upon bill filed” to foreclose the mortgage, the solicitor’s fee may properly be taxed as a part of the costs in the foreclosure suit.
    4. Chancery practice—exception to master’s report—in case of an improper allowance. If a master in chancery, in reporting the sum due on bill to foreclose a mortgage, should improperly tax an attorney’s fee against the defendant, exception should be taken to such item, so as to enable the court to correct the error.
    Writ of Error to the Appellate Court for the Third District ;—heard in that court on writ of error to the Circuit Court of McLean county; the Hon. O. T. Reeves, Judge, presiding.
    Messrs. Tipton & Beaver, for the plaintiffs in error:
    The principal upon which usury is allowed as a defence is, that the parties are not in pari clelicto, the borrower being under such moral duress as to take from him the character of particeps criminis. Hewitt v. Dement, 57 Ill. 500.
    An agreement in a mortgage and note to pay the attorney’s fees if there should have to he a foreclosure, is usurious. Thomasson v. Townsend, 10 Bush, 114.

      Authority to make a usurious loan will not be presumed where the agency is special, and limited to a single transaction ; but it may be presumed where the agency is general, and embraces the business of making, managing and collecting the interest of a moneyed man. Rogers v. Buckingham, 33 Conn. 81; Austin v. Harrington, 28 Vt. 130.
    Every subsequent security given for a loan originally usurious, however remote or often renewed, is void. Walker v. Washington Bank, 3 How. 62; Sugart v. Mays, 54 Ga. 554; Price v. Lyons Bank, 33 N. Y. 55.
    The shifts and devicés of usurers to evade the statute against usury, have taken every shape and form that the wit of man could devise, but none have been allowed to prevail. Courts have been astute in getting at the true intent of the parties, and giving effect to the statute. Quackenboss v. Sayer, 62 N. Y. 347.
    The court erred in taxing the $100 solicitor’s fee as costs in this case. The mortgage provides that the sum of $100, solicitor’s fee, “shall become due and payable immediately upon filing bill to commence suit.” Now, this sum was not due until after suit was brought, and we respectfully submit that it was error to enter a decree taxing the same as costs. In support of this viewwe cite the following cases: Nickerson v. Babcock, 29 Ill. 497; Byers v. National Bank, 86 id. 427; Dowty v. Holtz, 85 id. 525; Easter v. Boyd, 79 id. 325; Clark v. Morgan, 13 Bradw. 597.
    Mr. A. E. De Mange, for the defendant in error:
    The fact that an agent, without the knowledge or consent of his principal, upon loaning the money of the latter exacts from the borrower a sum in excess of the lawful interest, does not make the loan usurious. Cox v. Insurance Co. 113 Ill. 382; Phillips v. Roberts, 90 id. 492; Hoyt v. Pawtucket, etc. 110 id. 394.

      Parties may stipulate for the payment of an attorney’s fee in ease suit is brought. City v. Kimball, 90 Ill. 356; Railroad Co. v. Beckemeier, 72 id. 267.
    Parties are concluded by the master’s report, where no exceptions are interposed. Jewell v. Paper Co. 101 Ill. 58; Pennell v. Insurance Co. 73 id. 303.
   Mr. Justice Magruder

delivered the opinion of the Court:

This case is brought before us by writ of error to the Appellate Court for the Third District, which affirmed a decree of the circuit court of McLean county, foreclosing a mortgage.

In January, 1876, Margaret A. Haldeman borrowed'of the Massachusetts Life Insurance Company, through Tillotson & Wait, at Bloomington, $3600, she and her husband executing their bond to the company for that sum, bearing ten per cent interest, and giving a trust deed, to secure the payment of the bond, upon the land described in the bill. At the time, John B. Haldeman, husband of Margaret A., allowed to Tillotson & Wait a commission of five per cent ($180), which was retained by the latter from the money. In January, 1881, the bond maturing, Haldeman and wife made application to Tillotson & Fell, successors of Tillotson & Wait, for a renewal of the loan, which Tillotson & Fell obtained, and Haldeman and wife gave their bond to the insurance company for .$3 6 00, bearing eight per cent interest, (the then highest legal rate of interest), secured by trust deed on the same land, receiving no money whatever. On this occasion Haldeman paid to Tillotson & Fell a commission of $80. The last mentioned trust deed is the one foreclosed by the decree. -

The facts of this case, with the exception of the $100, allowed for attorney’s fees, as hereafter stated, are almost the same as the facts in the case of Cox v. Massachusetts Life Ins. Co. 113 Ill. 382. There, a commission of $150 was paid on the original loan, and a commission of $75 for the renewal of the loan, and it was held, that there was nothing of usury in the charge and payment of such commissions. .The question in this case is, whether, under a similar state of facts to that which is stated and discussed in the Cox case, the payment of the commissions above named of $180 and $80 constitutes usury. The opinion in the case referred to is decisive of the present case upon the question of usury.

The trust deed in this ease contained a stipulation, that a solicitor’s fee of $100 might be taxed as a part of the costs, in case a bill should be filed,to foreclose. We think, upon the authority of Dunn v. Rodgers, 43 Ill. 260, and Clawson v. Munson, 55 id. 394, that the circuit court committed no error in allowing the attorney’s fee to be taxed as a part of the costs.

If such allowance by the master in his report to the circuit court had been an improper one, appellants should have called attention to it by an exception to the master’s report, specifically pointing out the objectionable item. This was not done. If such an exception had been filed before the master, the circuit court could have corrected whatever error, if any, may have been committed in taxing the fee.

Counsel for plaintiffs in error claim, that an agreement in a mortgage for an attorney’s fee, such as is above set forth, is usurious. To sustain this claim, he refers to Thomasson v. Townsend, 10 Bush, (Ky.) 114. The Kentucky case seems to support the view, contended for by counsel, but it lays down a doctrine inconsistent with our decisions, and notably with the cases in 43 and 55 111. above referred to. A contract in a mortgage, that an attorney’s fee, which is reasonable in amount, may be taxed as a part of the costs, in a suit to foreclose the mortgage, is not regarded as usurious in this State. We have sustained such contracts as valid.

The judgment of the Appellate Court is affirmed.

Judgment affirmed.


author: Mr. Justice Mulkey

text:
    William Mount v. S. D. Scholes, Admr.

      Filed at Springfield March 23, 1887.

    1. Pleading—plea of former recovery. In pleading a former judgment in bar of a second suit on the same cause of action, either the term of the court at which it was recovered, or the exact date of the entry of the judgment, should be stated; and when taken in vacation, the time of its entry by the clerk should be stated. This rule should be applied with more stringency when the plea is not filed until after the issues are made up.
    2. If the judgment was rendered before the issues are made up, the plea of former recovery can not properly be filed, except upon a special application to the court for that purpose. If rendered afterward, the matter can only be pleaded puis darrein continuance.

    3. Same—plea puis darrein continuance. A plea puis darrein continuance only questions the plaintiff's right to further maintain the suit, and" by operation of law supersedes all other pleas and defences in the cause, and the parties proceed to settle the pleadings de novo, just as though no plea or pleas had theretofore been filed. As such pleas tend to delay the cause, great strictness is required in framing them, and, like pleas in abatement, they must be verified by affidavit.
    4. Such a plea, in bar to the further prosecution of the suit, operates as an admission on the record that the suit was properly brought and prosecuted up to the time of its filing, or date when the new defence arose, and thus has an important bearing on the question of costs.
    5. Judgment by confession—when void for want of jurisdiction, and for fraud. Where the maker of notes, after the death of the payee, acting in collusion with his wife, (a niece of the payee,) fraudulently abstracts them, and pending suit on them by the administrator, without the knowledge or consent of the administrator, confesses judgment on them in vacation, before the clerk of the court, in favor of the administrator, for the use of his wife, such judgment will be void for want of jurisdiction, and as.being fraudulent, and will be no bar to the pending action by the administrator.
    6. Mebgeb—effect of a judgment upon evidences of indebtedness. If judgment is rightfully entered by confession upon notes after suit brought thereon, but in a different court, the right of action on such notes will be merged in the judgment, and no recovery can be had upon the same; but if such judgment is fraudulent, and entered without legal authority or jurisdiction, there will be no merger.

      7. Evidence—secondary evidence, when original instrument is wrongfully withheld. The maker of notes, after the death of the payee fraudulently possessed himself of the same, and confessed a judgment in another court in favor of the administrator, for the use of the maker’s wife, and filed such notes in such other court. In an action upon the notes by the administrator, it was stipulated that copies of the notes might be used as evidence if the originals were proper evidence: Held, that the plaintiff might properly recover upon the notes without producing them on the trial. In such case, the defendant could take no advantage from his own wrongful act in placing the original notes beyond the reach of the plaintiff.
    8. Pleading and evidence—of matters in defence arising after issues formed. All matters of defence arising after the issues have been made up, must be specially pleaded, to entitle them to be given in evidence. Therefore, the rendition of a judgment by confession upon promissory notes, after suit brought on the notes, and the issues are made up, can not properly be shown in evidence under the general issue.
    9. Exception—when necessary. If no exception is taken to the ruling of the trial court in admitting evidence objected to, and no cross-errors are assigned by the party objecting, the objection to the evidence will be considered as waived.
    Writ of Error to the Appellate Court for the Third District ;—heard in that court on writ of error to the Circuit Court of Sangamon county; the Hon. James A. Creighton, Judge, presiding.
    Mr. N. M. Broad well, and Mr. W. J. Conkling, for the plaintiff in error:
    The plea of former recovery was a good plea. It "fully sets forth a recovery by defendant in error, for use, etc.-, against plaintiff in error, on the notes sued on.
    The doctrine that a former adjudication bars another suit between the same parties and privies, for the same cause of action, seems fully settled. Jones v. Smith, 13 Ill. 301; Zimmerman v. Zimmerman, 15 id. 84; Crosby v. Gipps, 16 id. 352; Railroad Co. v. Allen, 39 id. 205; Krenchi v. Dechder, 50 id. 176.
    It is equally well settled that a suit may be brought in the name of the party in whom the legal title is, for the use of the holder of an unindorsed note. Bates v. Kempton, 7 Gray, 382.

      That in ease of the death of the payee the holder may use the name of the administrator, although he protests against it, see Bates v. Kempton, 7 Gray, 382; 1 Wait’s Actions and Defences, 370.
    It is not competent for the defendant to controvert the right of the party for whose use the suit is brought, but it is enough to show a right in the legal plaintiff; and the party for whose use the suit is brought, need not show any right in himself. Hamilton v. Brown, 18 Pa. St. 87; Saltmarsh v. Bower, 22 Ala. 221; 1 Wait’s Actions and Defences, 370.
    It is wholly immaterial whether the judgment pleaded was rendered in an action commenced before or after the suit in which it is pleaded, Casebeer v. Mowry, 55 Pa. St. 419; Duffy v. Lythe, 5 Watts, 120; Gates v. Preston, 41 N. Y. 113.
    Not being lost or destroyed notes, the declaration should have shown a right of recovery, without the production of the notes. Rogers v. Miller, 4 Scam. 333.
    On rendition of the Menard judgment, the notes were merged in it. They then ceased to have an independent existence. Their legal existence became extinguished by merger in the judgment, and can never again become the basis of a suit. They have lost their vitality—are functus officio. Wyman v. Cochrane, 35 Ill. 152; Freeman on Judgments, sec. 215.
    It is no excuse for the non-production of a paper sued on, to show that it- is without the jurisdiction of the court, and in the possession of the adverse ..party by defective title. Abbott’s Trial Evidence, 389; Van Alstyne v. Bank, 4 Abb. 449.
    Messrs. Patton & Hamilton, for the defendant in error:
    The demurrer was properly sustained to the special plea, because it fails to state that the judgment in the Menard circuit court was entered before this suit was commenced, and because it fails to state when the defendant was impleaded, and, without giving any date, states that afterward the judgment was rendered.
    But the defendant had the full benefit of his judgment record. A former recovery may be shown under the general issue. 1 Greenleaf on Evidence, sec. 531; 1 Chitty’s Pleading, 418; 2 Gilm. 355; Vanlandingham v. Ryan, 17 Ill. 28.
    The defendant, without the knowledge or consent of the administrator, after he is sued in the Sangamon circuit court, goes into another court, and tries to put the title in the notes in his wife, by the confession of the judgment.
    But counsel say, if the confessed judgment is not a bar, the administrator can not recover on the notes because he can not force the Menard court to give the notes up to him,— that is to say, because the maker of these notes himself, or by collusion with his wife, and without the consent of Glass-cock in his lifetime, or his administrator after his death, wrongfully and fraudulently files the notes in a court so as to make them a part of the record of that court, the administrator can not recover on them.
    When copies of these notes were offered in evidence on the trial, the plaintiff in error expressly waived all objection which he might have urged to the non-production of the originals, and.agreed that the copies might be used as evidence if the originals were proper evidence under the facts in this case. This agreement put defendant in error in the same position as if the clerk of the Menard circuit court h-ad produced the notes at the trial on a subpoena duces tecum.

   Mr. Justice Mulkey

delivered the opinion of the Court:

At the January term, 1886, of the Sangamon circuit court, S. D. Scholes, administrator of Travis Glasscock, deceased, recovered therein a judgment against William Mount, for the sum of $3704.37, which, having been affirmed by the Appellate Court for the Third District, the defendant brings the case here for review.

The record shows the following state of facts : Travis Glass-cock died at the house of William Mount, in Menard county, this State, on the 18th day of March, 1882, leaving a last will and testament. The executors named in the will having declined to act, the defendant in error, S. D. Scholes, was appointed administrator of the estate, with the will annexed. At the time of Glasscock’s death, he held notes given by Mount to himself, aggregating (interest included) between $2000 and $3000. These notes, together with other valuable papers, were kept by him in a small tin box. About a month before his death, as if apprehending some trouble in respect to them, he caused his business manager, A. J. Barber, to take a copy of them. After his death, the executors not finding the notes among his other papers, they called at the house of William Mount, and asked his wife, who is a niece of the deceased, what had become of them. In this interview, she stated, as is sworn to by two witnesses, that the deceased had given her the notes, and that they were burned. This statement, at least so far as the burning of the notes is concerned, Avas entirely false, as is shown by subsequent events. The administrator, Avithout having the notes in his possession or power, on the 28th of December, 1882, brought the present suit upon them.

The declaration contained a special count on the notes, and also the money counts. At the February term, 1883, the defendant filed the plea of non assumpsit, and issue Avas joined thereon. No further steps seem to have been taken in the case until the September term, 1885, when the defendant filed a plea of former recovery, to which the court sustained a demurrer, and the ruling of the court upon the demurrer is assigned, for error. The plea we regard as clearly bad, and, consequently, there was no error in sustaining the demurrer to it. Without stopping to consider the several objections to it which have been pointed out by counsel, we think its failure to state the time when the judgment was obtained, rendered it substantially defective. In pleading a judgment, either the term of the court at which it was recovered, or the exact date of its rendition, should always be stated, and when taken in vacation, as this one was, the time of its entry by the clerk should be stated. (Freeman on Judgments, sec. 450.) If such be the general rule, it should certainly be applied with more stringency in cases like the present where the judgment is obtained after the commencement of the suit. In these cases the rights of the plaintiff will depend, to some extent, upon whether the judgment was recovered before or after plea. If rendered before, the plea could not properly be filed, except upon a special application to the court for that purpose. (Millikin v. Jones, 77 Ill. 372; Fisher v. Green, 95 id. 94.) If rendered afterwards, the matter could only be pleaded puis darrein continuance.

The general rule upon this subject, at common law, is, that any matter of defence arising after the commencement of the suit, can not be pleaded in bar of the action, generally. If such matter arise after the commencement of the suit and before plea, it must be pleaded to the further maintenance of the action. But if it arise after plea, and before replication; or after issue joined, whether of law or fact, then it must be pleaded puis darrein continuance. A plea of this kind involves grave legal consequences that do not attach to an ordinary plea. It only questions the plaintiff’s right to further maintain the suit. When filed, it, by operation of law, supersedes all other pleas and defences in the cause, and the parties proceed to settle the pleadings de novo, just as though no plea or pleas had theretofore been filed in the case. By reason of pleas of this kind having a tendency to delay, great strictness is required in framing them. In this respect they are viewed much like pleas in abatement, and, for the same reason, they must, like those pleas, be verified by affidavit. 1 Chitty’s Pleading, (12th Am. ed.) 660; 2 Tidd, (1st Am. ed.) 776-778.

Treating the plea under consideration as a plea of puis clarrein continuance, it is confessedly bad. Indeed, it has none of the distinctive features of such a plea, nor has it been pleaded or treated by the court or counsel as such.

While, as we have seen, the plea in question fails to state the date of the judgment, nevertheless, upon'looking into the record, we find it was entered on the 2d of March, 1883, which was some time after issue had been joined on the defendant’s plea of non assumpsit, which was the only plea in the case. Now, it is clear from what we have already said, if the date of the judgment had been inserted in the plea according to the fact, the plea would, without doubt, have been clearly bad, because the matter set up in it could only have been pleaded puis darrein continuance. This is obviously so, for the reason such matter was only available as a bar to the further prosecution of the suit, whereas, by suppressing .the date, it was sought to interpose it as a bar to the suit from its inception. This can not be permitted. These considerations clearly show the propriety of the rule above adverted to, which requires a plea of former recovery to state the date of the judgment. Had the matter been pleaded, as it ought to have been, as a bar to the further prosecution of the suit, only, it would have operated as an admission on the record that the suit was properly begun and prosecuted up to the time of filing such plea, or, in any event,.up to the date of the judgment, which, of course, would have had an important bearing upon the question of costs.

The record of the judgment set up in the plea was put in evidence on the trial, under the general issue. The question therefore arises, what, if any, effect should be given the judgment as a mere instrument of evidence? We think it clear, from the authorities, as well as from the nature of the defence, and its legal effect, when properly made, that all matters of defence arising after the issue or issues have been made up, must be specially pleaded. Such being the law, it follows, the trial court erred in admitting the record of the judgment in evidence, against the objection of the plaintiff. But as no exception seems to have been taken to the ruling of the court, the objection must be considered as waived. Moreover, no cross-errors have been assigned by the defendant in error.

Looking at the record, then, as we find it, the question arises, what, if any, errors of law intervened in the trial court, to the prejudice of plaintiff in error, for which the Appellate Court, should have reversed the judgment.

A jury having been waived, the court, after the evidence was in, was asked to hold certain propositions, the legal effect of which was, that under the facts proved there was no right of recovery. The material points raised by the propositions submitted to the court may be considered together, but before doing so it will be necessary to advert more particularly to some of the facts out of which they arise.

It appears from the record, that on the 2d of March, 1883, plaintiff in error, without the authority, knowledge or consent of the defendant in error, confessed a judgment in the Menard circuit court, in favor of the latter, for the use of Phebe Mount, his wife, for the sum of $3219.80, upon the same notes now sued on; that said notes were filed with the other papers in said cause, at the time of the confession of said judgment,where they have remained ever since. Outside of the claim of Mrs. Mount, when called on to explain their absence, that they had been given to her by the testator, neither Mount, his wife, nor any one else, has explained in what manner, or for what purpose, or by whom, they were abstracted from the effects of the deceased. Her claim that they were given to her, is overcome by countervailing evidence. Moreover, it was connected, as we have seen, with the statement that they were burned, which was clearly false, and, indeed, without any foundation whatever, so far as this record shows.

Stating the matter in the very mildest terms, the evidence tends strongly to show that the plaintiff in error, acting in collusion with his wife, fraudulently abstracted the notes from the box in which the deceased had left them, and with a like fraudulent purpose of depriving the estate of their ownership, and .preventing their collection by the administrator, confessed the judgment upon them in the Menard circuit court. If this be so, (and we must assume it is, for the courts below have both, in legal effect, so found,) the judgment in question was fraudulent and void. Viewed in this light, it clearly can not be made available as a defence to the present action. Under the circumstances, the clerk acted without authority or jurisdiction in entering up the so-called judgment.

The whole defence is based upon the hypothesis that the right of action on the notes was merged in the judgment. The conclusive answer to this is, that the judgment being fraudulent, and having been entered without legal authority or jurisdiction, there could be no merger.

We agree with counsel for plaintiff in error, that so far as the question of merger is concerned, it is of no consequence that the present suit was commenced first. If the judgment in the Menard circuit court had been properly confessed, and free from fraud, the right of action on the notes would have been merged, notwithstanding the confession and entry of it were subsequent to the commencement of this suit. And if, in such case, it had been properly pleaded, or even put in evidence without exception, as it was, it would have presented a complete bar to the further maintenance of the present suit, as we have already seen. This view does not at all conflict with the well recognized doctrine, adverted to by counsel, that where the jurisdiction is concurrent, the court first obtaining it will be entitled to hold it.

Under the circumstances, we perceive no force in the claim that the plaintiff can not maintain a suit upon the notes without having them in his possession. By the defendant’s own wrongful act, the notes, as we have seen, now constitute a part of the records of the Menard circuit court, and he should therefore not he permitted to derive any benefit from the plaintiff’s inability to produce them in court. This would be to allow him to take advantage of his own wrong. Moreover, it is stipulated between the parties, that copies of the notes might be used as evidence, “if the originals were proper evidence under the facts in this case. ”

Holding, as we do, that the notes were not merged in the so-called judgment, it follows, they would have been proper evidence in the case, if present. The point, therefore, on either of these grounds, is clearly not well taken.

What we have already said is deemed a sufficient answer to the remaining points raised in the briefs.

Perceiving no error in the record, the judgment will be affirmed.

Judgment affirmed.


author: Mr. Justice Shope

text:
    John Schroeder v. Thomas Walsh.

      Filed at Ottawa March 22, 1887.

    1. Fraudulent conveyance—both parties must participate. As a general rule, to render a sale or conveyance fraudulent as to creditors of the vendor, there-must be mutuality or participation in the fraudulent intent on the part of both the vendor and the purchaser.
    2. Same—evidence—to establish fraud. Where a sale of goods is attacked as being in fraud of creditors of the vendor, the fraud must be shown by at least a preponderance of the evidence, or the sale will not be defeated. Generally, the proof of the fraud should be clear and satisfactory.
    3. Where a party proves a purchase of goods which appears on its face to be free from fraud, and shows the payment of a fair and adequate consideration and an actual change of possession, he makes out a prima facie title to the property; and it is incumbent on one attacking the same for fraud as against creditors, to establish the fraud by a preponderance of evidence.

      4.. For the purpose of showing that a sale of a lot of goods by a failing debtor to a relative was fraudulent as to creditors, the creditor offered to show that on the same day a judgment was entered by confession in favor of another relative, and against the debtor, and that an execution was taken out under the judgment. There was nothing to connect the purchaser of the goods with this latter matter: Held, that the evidence was properly excluded.
    5. In such a case, the court instructed, for the vendee, that “a man has a perfect right to deal with his relations,—to buy and sell from or to them; and the presumption of the law is, that dealings between relatives are fair and honest, without any wrongful or fraudulent intent, and no presumption of fraud attaches to such dealings,” etc.: Hel§, that there was no error in giving the instruction.
    6. Same—preference of creditors. In the absence of any bankrupt law or statute to the contrary, the law is well settled that a debtor in failing circumstances, not seeking the benefit of the general Assignment law, may prefer one creditor to another equally meritorious, if done in good faith. The statute regulating assignments by insolvents has no application to such a case.
    7. Instruction—construed—as to character of proof to show fraud. On the trial of an issue whether a sale of goods was made to defraud creditors, ithe court told the jury that they were not permitted to guess, or suspect, or presume fraud, but must find it from the evidence, as they would any other fact: Held, not liable to the objection of being calculated to make the jury believe fraud could be shown only by direct evidence, and not by circumstances, especially when such impression is guarded against by opposing instructions.
    8. Appeal—reviewing facts. Where the Appellate Court finds, from the evidence, that a sale of property was not made with intent to hinder, delay or defraud creditors, this court, on appeal or error, will be bound by such finding.
    Appeal from the Appellate Court for the Second District;— heard in that court on appeal from the Circuit Court of Grundy county; the Hon. Charles Blanchard, Judge, presiding.
    This was an action of replevin, brought by Thomas Walsh, in the circuit court of Grundy county, on October 5, 1878, against John Schroeder, sheriff of the county, for the recovery of a stock of goods valued at $2000. The defendant pleaded non cepit, non deiinet, property in Ward & Pierce, and property in the defendant by virtue of a levy of a writ of attachment issued out of said court, at the suit of William Young & Co., against said Ward & Pierce, bearing date September 26, 1878. Issues were formed under these pleas, denying the wrongful taking and detention, asserting property in the plaintiff, and denying that the defendant was sheriff, and the issue and levy of the writ of attachment.
    On the first trial, there was a verdict and judgment for the plaintiff, which was reversed by the Appellate Court for the Second District, and the caus.e remanded. A second trial was had, resulting as on the first. The defendant moved for a new trial, generally, without assigning the grounds of the motion in writing, which motion was overruled, whereupon the defendant appealed to the Appellate Court, assigning for errors, first, that the court erred in giving each and every of the plaintiff’s instructions, especially those numbered 4, 7, 8, 9, 10, 11, 12, 15, 16, 17 and 19; second, that the court erred in modifying defendant’s fourth and fifth instructions; third, that the verdict of the jury was contrary to the law, and not warranted by the evidence; and fourth, that the court erred • in overruling the motion for a new trial, and in rendering judgment on the verdict.
    The facts of the case, briefly stated, are these: In 1876, the firm of Ward & Pierce, composed of Samuel Ward and W. Scott Pierce, became partners, as grain dealers, at Verona, Grundy county, in this State. They built a grain elevator on railroad ground, and soon increased their business by engaging in the coal and lumber traffic, and also by dealing in cattle. They soon became largely indebted in excess of their assets. On January 24, 1878, they gave their note to one E. Hopkins, for the sum of $3000, payable in nine months, which was signed by the firm, (they being principals,) and by Thomas Walsh, William Pierce, Randolph Hill and Samuel Small. This note was assigned by the payee to William Young & Co., commission merchants of Chicago, who, from time to time, made large advances of money to Ward & Pierce, with which to purchase corn. Walsh, W. Scott Pierce and Small were sons-in-law of Samuel Ward.. It was also claimed that the firm was indebted to Walsh in the sum of $1000 for money loaned, and about $700 on account. Ward owned a storehouse and lot in Verona, which was mortgaged to secure the sum of $240, to J. H. Skeel & Co. This lot was worth about $1000. Ward was also the owner of 201 j- acres of land, and held a contract of purchase for 60 acres more of land, on which he had paid $800, and was to pay $1000 more.
    On September 14, 1878,, Samuel Ward executed and acknowledged three deeds before W. Scott Pierce, who was a notary public,—one to Thomas Walsh, for 88J acres of land, for the expressed consideration of $1000; another to Walsh, for the store building and lot, for the expressed consideration of $560; and the third to Millard Small, his son-in-law, for 113 acres of land, for the expressed consideration of $760; and he also assigned to Small the contract for the purchase of the 60 acre tract. There was a mortgage of $1500 on the 88g- acre tract. The other tract conveyed to Small was also incumbered to the amount of $3000. These three deeds were recorded September 17, 1878. On the day last named, a judgment by confession was entered up in the circuit court of Grundy county, against Ward & Pierce, and in favor of William Pierce, one of the sureties on the Hopkins note, for $3137.79, on a judgment note of Ward & Pierce, dated September-2,1878, upon which an execution was issued. On the same day, Ward & Pierce sold their entire .stock of goods „to Walsh, for the sum of $2000 in cash paid down, and the latter took immediate possession of the goods. This money, or nearly all of it, was applied by W. Scott Pierce upon the Hopkins note. William Young & Co., on learning of these transactions, had a judgment by confession entered upon the Hopkins note of $3000, which was, on September 26, 1878, paid by W._ Scott Pierce. On the same day this judgment was paid, Young & Co. brought an action of assumpsit in the Grundy circuit court, against Ward & Pierce, in which they claimed $15,000, and on the same day sued out an attachment in aid thereof, under which, the defendant, Schroeder, as sheriff, levied upon the lot of goods sold by Ward & Pierce to Walsh.
    Mr. P. A. Armstrong, and Messrs. Bisbee, Ahrens & Decker, for the appellant.
    Mr. S. C. Stough, for the appellee.
   Mr. Justice Shope

delivered the opinion of the Court:

This controversy involves 'the validity of a sale of a lot of goods, made by Ward & Pierce, on September 17,1878, to the appellee, Thomas Walsh, which is claimed to be fraudulent as to the creditors of that firm. The finding of the Appellate Court that this'sale was bona fide, and was not made to disturb, delay, hinder or defraud creditors, must be accepted by this court as a finality, from the evidence, regardless of the conclusion we might have reached from a consideration of the evidence, and it only remains to determine the question of law presented for our consideration.

The point is made in argument, that the trial court erred in its refusal to admit in evidence the judgment by confession in favor of William Pierce, and against Ward & Pierce, of the date of September 17, 1878, for $3137.79, entered upon the judgment note of September 2, 1878, together with the execution issued thereon, and the sheriff’s return on the same.» There is.no assignment of error calling in question the propriety of any ruling of the court in the exclusion of evidence, unless that is covered by the assignment of error for refusing a new trial. It is not perceived how the confession of a judgment in favor of a third person, whether proper or not, can affect the rights of the appellee, who is not shown to have been present, or in any way connected with it. He is not called upon to explain his vendor’s transactions with others, when lie is not a party to them and has no connection with them. It is enough for him to show that he is not subject to the imputation of fraud on his part.

Objection is made to appellee’s fourth instruction, that it declares that a preponderance of evidence is -necessary to establish fraud. When a party proves a purchase of goods, which appears on its face to be free from fraud, and shows the payment of a fair and adequate consideration, and an actual change of possession, he makes out a prima facie title to the property, and it is incumbent on one attacking the same for fraud, as against creditors, to establish the fraud by a preponderance of evidence, in order to defeat the sale.

We are referred to Bryant v. Simoneau, 51 Ill. 324, where the court say: “While fraud can not be proved by circumstances that merely raise a suspicion, yet when they are so strong as to produce a conviction of the truth of the charge, although there, may remain some doubt, then it is proved. This is believed to be the extent of the rule that fraud must be proved.”' The rule announced in that case is not at variance with the rule stated in the instruction. Fraud may be shown by circumstances, hut when the evidence, whether it be direct or circumstantial, is so strong as to produce conviction in the mind, of the truth of the charge, it will be sufficient. But this does not authorize the finding of fraud on less than a preponderance of the evidence, taken as a whole. By the words, “preponderance of evidence,” is meant the greater weight of evidence, and it is difficult to see how any disputed question of fact can be found except by the greater weight of evidence. The difference in the weight may be slight, but unless it preponderates on one side, or has greater weight than on the other, the matter in dispute can not be said to-be proved. If the evidence, in its weight, is equally balanced between the contending parties, the one holding the affirmative of the issue must fail; and the same may be said when he has less than a preponderance of the evidence. Bump, in his work on Fraudulent Conveyances, page 603, says: “While the law abhors fraud, it is also unwilling to impute it on slight and trivial evidence, and thereby cast an unjust reproach upon the character of the parties. (Blow v. Gage, 44 Ill. 208.) Such an imputation is grave in its character, and it can only be sustained on satisfactory proof. If the evidence is so conflicting that no conclusion can be reached, the transaction must be sustained, upon the principle that the burden of proof is on the party who assails it, and if he does no more than create an equilibrium, he fails to make out his case. ” On page 604, the same author says: “What amount or weight of evidence is sufficient proof of a fraudulent intent, is not a matter of legal definition. If the evidence is admissible, as conducing in any degree to the proof of the fact, the only legal test applicable to it upon such an issue, is its sufficiency to satisfy the mind and conscience, and produce a satisfactory conviction or belief. (Carter v. Gunnels, 67 Ill. 270.) The proof, however, must be satisfactory. It must be so strong and cogent as to satisfy a man of sound judgment of the truth of the allegation. It need not possess such a degree of force as to be irresistible, but there must be evidence of tangible facts, from which a legitimate inference of a fraudulent intent may be drawn. * * * As an allegation of fraud is against the presumption of honesty, it requires stronger proof than if no such presumption existed. ”

This court has frequently held, that the evidence must be clear and satisfactory to establish fraud against creditors in a transaction. (Pratt v. Pratt, 96 Ill. 184; Bowden v. Bowden, 75 id. 143; Blow v. Gage, 44 id. 208.) In Bonnell v. Wilder, 67 Ill. 330, this court say: “It is a well established rule in all courts, that a party who makes an affirmative allegation must maintain it by proof. His proof must be superior to that offered by his adversary. (Watt v. Kirby, 15 Ill. 200; Union National Bank v. Baldenwick, 45 id. 375.) When a party affirms the existence of a material fact, he must prove it, or the negative will be presumed. And when the proof is equally balanced, or the jury are unable to determine that it preponderates in favor of the affirmative, the presumption of the negative is not overcome. This equilibrium may be destroyed by the surrounding circumstances. ”

The appellee’s sixth instruction is as follows:

“Fraud is never to be presumed, but must be affirmatively proved by the party alleging the same. ■ The law presumes that all men are fair and honest,—that their dealings aré in good faith, and without intention to disturb, cheat, hinder, delay or defraud others; and if any transaction called in question is equally capable of two constructions,—one that is fair and honest, and the other that is dishonest,—there the law is, that the transaction questioned is presumed to be honest and fair.”

The objection urged to this instruction is, that it requires fraud to be shown by affirmative testimony, and excludes all circumstantial evidence. We do not think it does so, by any fair and reasonable construction. Fraud in fact, as contra-distinguished from fraud in law, is never presumed without evidence, but must be proved by either direct or indirect evidence. The instruction does not undertake to say what kind of evidence must be adduced, but its drift and purpose is to show that the party charging fraud has the affirmative of the issue, and must sustain the charge, by proof on his part. He may do this by showing facts or circumstances from which fraud is inferred, and thus establish fraud affirmatively. This instruction is not obnoxious to the objection made to it.

Appellee’s seventh instruction is also questioned, as being the reverse of the law in both its propositions. It reads:

• “A man has a perfect right to deal with" his friends and relations,—to buy and sell from or to them,—and the presumption of the law is, that dealings between relatives are fair and honest, without any wrongful or fraudulent intent, and no presumption of fraud attaches to such dealings; and if a man finds himself in failing circumstances, he has a right to prefer one creditor to another,—to so dispose of his property that one of his creditors shall receive his pay in full, and another receive nothing. Nor is there any presumption of fraud in so doing. ”

The question involved in the first part of this instruction has been frequently before this court, and it has held, that mere relationship between the vendor and vendee, without other indicia of fraud, affords no presumption of fraud. In Nelson v. Smith, 28 Ill. 495, this court say: “The fact that the sale was made to a relative, is not unusual, and is not a badge of fraud. Nor can fraud be inferred from the fact that the vendor was indebted at the time he made the sale. ” In Wightman v. Hart, 37. Ill. 123, the court say: “Nor does the fact that Albert and Charles (the - purchasers) were relatives, prove fraud. It may be a circumstance to excite suspicion, but, of itself, is not proof.” In Waterman v. Donalson, 43 Ill. 29, it is said: “Nor does the fact that he (the vendee) was the uncle of David A. Waterman, prove that he intended to aid and assist him in defrauding his creditors. Relatives may, undeniably, trade with each other, as well as strangers.” In Bump on Fraudulent Conveyances, page 56, it is said: “Relationship is not a badge of fraud. * * * Any relation which gives rise to confidence, though not a badge of fraud, * ■ * * strengthens the presumptions that may arise from other circumstances, and serves to elucidate, explain or give color to the transaction. ”

Thus it will be seen, that the mere fact of relationship, without other facts and circumstances, affords no presumption of law against the bona Jides of a sale from one to the other. It may excite suspicions, and may be considered with other evidence tending to impeach the transaction. As to the other part of 'the instruction, in the absence of any bankrupt law, or statute, to the contrary, the law is well settled that a debtor in failing circumstances, not seeking the benefit of the general Assignment law, may prefer one creditor to another equally meritorious, if done in good faith. Morris v. Tillson, 81 Ill. 607; Tomlinson v. Matthews, 98 id. 178; Goembel v. Arnett, 100 id. 34; Bump on Fraud. Con. 183; Wait on Fraud. Con. sec. 390.

The case of Phelps v. Curts, 80 Ill. 109, is not to be understood as denying a failing debtor the right to prefer a creditor. In that case, the assignment was made with a view to the debtor’s own advantage, in delaying his creditors an unreasonable time before his property could be appropriated to their benefit, and for the purpose of preventing a sacrifice.

The statute relating to assignments by debtors for the benefit of their creditors, and prohibiting preferences in such assignments, has no application to a case of this kind. Notwithstanding that statute, a debtor may pay one creditor in full, either in money or by the sale of his property. That act applies only to conveyances of property to an assignee or trustee, in trust, to convert the same into money for the .benefit of creditors of thé assignor, which can now only be made under that law. Hanchett v. Waterbury, 115 Ill. 220.

Appellee’s ninth instruction, which is complained of, in substance told the jury, that while fraud might be proved by circumstances, yet the appellee must have participated in, or have been a party to, the intent to defraud the creditors of Ward & Bierce, in order to invalidate his title to the goods. As a general rule, to render a sale or conveyance fraudulent as to-creditors of the vendor, there must be mutuality of participation in the fraudulent intent on the part of both the vendor and the purchaser. (Bump on Fraud. Con. sec. 199; Ewing v. Runkle, 20 Ill. 448.) In order to impeach a conveyance of land for fraud, both grantor and grantee must be shown to have intended to commit the fraud as against creditors of the grantor. Hatch v. Jordon, 74 Ill. 414; Gridley v. Bingham, 51 id. 153; Myers v. Kinzie, 26 id. 36; Grant v. Bennett, 96 id. 513. This will also dispose of the objection to the modification to the defendant’s last instruction.

Appellee’s eleventh instruction is claimed to be erroneous, and is as follows :

“The court instructs you (the jury,) that before you can find for the defendant, on the ground that the sale of the property in question from Ward & Pierce, to the plaintiff, was fraudulent, by a preponderance of the evidence, you are not permitted to guess or suspect or presume fraud, but must find it from the evidence, as you would any other fact. ”

It is urged that this instruction requires a preponderance of evidence to prove the existence of fraud, and that it requires the fraud to be found from the evidence, the same as any other fact. What has been said of appellee’s fourth instruction disposes of the first objection. In support of the second objection, we are referred to the cases of Reed v. Noxon, 48 Ill. 323, and Strauss v. Kranert, 56 id. 254. The objectionable instruction in the first of these cases is not given, but the court say: “The jury are there told that fraud is not to be inferred, but must be proved like any other material fact. The jury might suppose from this, that fraud must be proven by direct evidence of a witness speaking from personal knowledge of the fraudulent intent.” Here, the instruction is not thought to be liable to any such construction. It is true, as stated in that case, that fraud “must generally be proven where it exists, by showing such facts and circumstances as to justify the jury in inferring a fraudulent intent or motive.” But such facts and circumstances, when proven, constitute evidence upon which the jury may infer fraud, and unless the facts and circumstances proved, in connection with all the other evidence, show fraud, the jury can not find it from the evidence.

The court, on behalf of the defendant, instructed the jury very fully and favorably to him. By his second instruction the jury were told that the question for them to decide was, “Did Ward & Pierce fairly and honestly dispose of the stock of goods in question, or did they dispose of it in the manner they did, with the fraudulent design of disturbing, hindering, delaying or defrauding their creditors, and if so, did the plaintiff participate in such design ; and in determining this question, it is the duty of the jury to take into consideration and carefully "weigh and consider all the circumstances, including the relation of the parties, which are in evidence in this case; that fraud is said to be the judgment of the law on facts and intents, and the fact, if proven, that the firm of Ward & Pierce disposed of all their property, including the stock of goods in question, within a few days’ time, and all the circumstances surrounding the said sales and transfers, being in evidence, it is for the jury to determine, from these facts and surrounding circumstances, the intent of making said sale and transfer; and if they believe, from said evidence, facts and circumstances in evidence, that said sale, transfer and conveyance of the stock of goods in question was made with the intent to disturb, hinder, delay or defraud William Young & Co., or the other creditors of said Ward & Pierce, and that the plaintiff had knowledge of and participated in such intent, then, in law, such sale, transfer or conveyance of these goods was a fraud upon the said Willliam Young .& Co., as well as.all other creditors of said Ward & Pierce, and the law in that case is for the defendant on that point.”

The court also gave the following other instruction for the defendant:

“The jury are further instructed, that fraud is not generally proved by direct testimony of witnesses speaking from their own knowledge of the fraudulent intent, because parties intending to commit a fraud do not call witnesses to the. transaction. It may be proved by the surrounding facts and circumstances; and if, from the facts and circumstances surrounding this case, as shown by the evidence, the jury believe the goods in question were sold or transferred to the plaintiff by the firm of Ward & Pierce, with the intent to disturb, hinder, delay or defraud William Young & Co. from collecting their debt against said Ward & Pierce, and that plaintiff had knowledge of and participated in such fraudulent intent, then they will find the title of the goods in question was in the defendant at the time they were replevined, provided it appears, from the evidence, that Young & Co. were creditors of Ward & Pierce at the time.”

The instructions for the appellee, when considered in connection with these and other instructions for the appellant, can not be said to have misled the jury, by leading them to infer that fraud in the transaction could be proved only by direct testimony, and ,in this respect the case at bar is quite different from the cases cited. The other case, of Strauss v. Kranert, is not analogous to this. There, the court refused an instruction to the effect that fraud might be proved by circumstantial evidence as well as positive proof.

What has been said disposes of all the points which are deemed of sufficient importance to be specially considered. We think the instructions, taken as a whole, lay down the rules of law applicable to the facts of the case, with substantial accuracy. The facts, as already said, are, by the judgments of the circuit and Appellate courts, put beyond our consideration, and we have, in this case, looked into them oftly to determine if the instructions as given fairly submitted the issues to the jury. We think this was done, and the judgment of the Appellate Court will be affirmed.

Judgment affirmed.


author: Mr. Chief Justice Scott

text:
    Oliver B. Green v. Elisha C. Sprague et al.

      Filed at Ottawa May 12, 1887.

    1. Mechanic’s lien—personal decree—to what extent allowable—and when not permissible. It is error to render a personal decree in a proceeding to enforce a mechanic’s lien, against the defendant or party with whom the contract was made, except for such deficiency of the debt as may remain after sale of the property burdened with the lien.
    2. Where property, however, becomes divested of a mechanic’s lien by reason of a sale under a prior incumbrance, so that it can not be sold to satisfy the mechanic’s demand against his employer, no decree should be entered except for the dismissal of the petition. In such case it is error to render any decree against the party for whom the work was done or materials fur-' nished.
    3. Same—cut off by sale under prior lien. Where a contract is made with the owner of real estate for the furnishing of materials and labor to improve the property, pending a bill to foreclose a prior mortgage on the same premises, a decree and sale under the bill will out oif all rights of the mechanic or material-man for a lien.
    Appeal from the Appellate Court for the First District;— heard in that court on writ of error to the Superior Court of Cook county; the Hon. John A. Jameson, Judge, presiding.
    Messrs. Miller, Leman & Chase, for the appellant:
    We are aware that the jurisdiction to award an execution depends upon sustaining the lien, and that it should be for the deficiency after the lien is exhausted. The existence of the lien is a jurisdictional necessity to the right to pursue this remedy. Sprague had an estate in the premises when the contract was made and the suit was brought. We were then entitled, as against Sprague, to a sale of that interest. But as a sale of his interest would have realized nothing, the law did not require it. The law may consider such sale as made, for the purpose of awarding execution for the whole sum. due. The deficiency is for the whole amount. Land Co. v. Peck, 112 Ill. 408.
    The prayer of the petition was sufficient for any relief which the allegations and proof showed the petitioner was entitled to. Stanley v. Valentine, 79 Ill. 544; Isaac v. Steel, 3 Scam. 97; Conger v. Benny, 84 Ill. 600; Vansant v. Allman, 23 id. 30.
    The Appellate Court erred in not sustaining the errors assigned by appellant in the decree of the Superior Court, and - in not sustaining our lien upon the building, as against the mortgagee and the purchaser, under the decree of foreclosure. Rev. Stat. chap. 82, see. 17.
    Mr. I. K. Boyeson, for the appellees:
    It is error to order an execution, in the first instance, in a mechanic’s lien proceeding. Rev. Stat. chap. 82, sec. 25; Baptist Church v. Andrews, 87 Ill. 172; Bouton v. McDonough County, 84 id. 384; Davis v. Life Ins. Co. id. 508.
    Where the complainant is not entitled to a lien, he can not obtain a judgment on the quantum meruit, in chancery. McKinney v. Springer, 6 Blackf. 511.
    Execution in- a mechanic’s lien proceeding can only be ordered against such persons as would be liable in an action at law. Race v. Sullivan, 1 Bradw. 96.
    A party can not obtain relief not prayed for,—he can only get relief according to the scope of his own bill. Kellogg v. Moore, 97 Ill. 282; Belanger v. Hershey, 90 id. 70; Race v. Sullivan, 1 Bradw. 96.
    • Where the basis of jurisdiction is discovery, or any other specific jurisdictional averment, if the jurisdictional averment is not proven, relief can not be granted. Story’s Eq. Jur. (Redfield’s ed.) sec. 690, p. 663; Fire Ins. Co. v. First Nat. Bank, 1 Bradw. 357.
    Messrs. Isham & Lincoln, also for the Insurance Company and Jacob L. Green.
   Mr. Chief Justice Scott

delivered the opinion of the Court:

This proceeding was to establish a mechanic’s lien in favor of certain parties, against property described in the original petition. Prior to the making of the contracts out of which it is said the liens arose, there had been a mortgage on the premises. Proceedings to foreclose the mortgage were pending in the United States District Court at the time of the making of the contracts with the mortgagor, although it does not appear any decree in the foreclosure suit had been rendered at the time the petitions herein were filed. Afterwards, in pursuance-of the decree rendered^ the premises were sold, and purchased by one of defendants, perhaps for the mortgagee, and who-was in possession prior to the rendering of the decree in the mechanic’s lien eases in the Superior Court. It will be noticed, the court found the premises on which the improvements for which a lien is claimed, had passed, under the mortgage sale, to the purchaser then in possession, and there was therefore nothing to which, or upon which, a lien in favor of the mechanics and material-men could attach or be established, and for that reason dismissed the original and intervening petitions as to the parties claiming to own the premises under the mortgage sale. But the court found the several amounts due to each of the parties that had done work and furnished materials to the party alleged to have an interest in the premises, and with whom the contracts had been made, and on so-ascertaining the several amounts, rendered a personal decree against him for the same, and awarded execution. Afterwards, Sprague, the party having the improvements made, filed the record in the Appellate Court, and assigned errors upon the same, the principal one of which is, the Superior Court erred in ordering an execution against plaintiff in error in the first instance, in a case where no sale could be made and where no deficiency would remain. Upon the same record, Green, an intervening petitioner, assigned cross-errors, to the effect the court erred in dismissing his petition for want of equity as to the defendants, the Connecticut Mutual Life Insurance 4 •} Company and Jacob L. Green, the parties claiming the property as absolute owners under the sale made under the decree of the United States District Court. The Appellate Court reversed the decree of the Superior Court, and rendered a judgment that Sprague recover his costs of Green, the party who had assigned cross-errors on the record, and that he have execution therefor. Green brings the case to this court on appeal.

The decision of the Appellate Court reversing the decree of the Superior Court, as to Sprague, was clearly right, on the authority of Bouton v. McDonough County, 84 Ill. 384. It was said in that case: “The statute does not contemplate that there shall be any such thing as a personal decree alone. The decree rendered may operate as such, so far as respects any deficiency, after there has been a sale upon execution of the property subject to the lien, and it fails to satisfy the amount found due. The statute, by all its provisions, is only intended to apply and have operation as respects property which may and is to be sold on execution. ” The same doctrine is declared in Baptist Church v. Andrews, 87 Ill. 172. These cases are conelusive*on the analogous question involved in this case. The Superior Court found the property was not subject to the lien of the mechanics and material-men, and assuming that finding to be correct, it should have dismissed the petitions. Under the statute, the court had no rightful authority to render a personal decree against the party with whom the contracts were made, in favor of the mechanics and material-men.

It is said, it was error in the Appellate Court not to sustain the lien claimed by Green upon the building, as against the Connecticut Mutual Life Insurance Company and Jacob L. Green. That was one of the cross-errors assigned by him on the record of the Superior Court. The point discussed can hardly be considered an open question, since the decision of this court in Davis v. Connecticut Mutual Life Ins. Co. 84 Ill. 508. The facts in the present case are essentially the same as in that case. It was there said: “The contract was made subject to the contingency, a bill being pending, of the decree that may be passed, ”—and the conclusion reached was, the decree and the subsequent sale cut off all rights claimed by the mechanics under their petition for a lien. So nearly analogous are the eases, the one in hand must be controlled by the former case.

The judgment of the Appellate Court will be affirmed.

Judgment affirmed.