author: Mr. Justice Magruder

text:
    Marcus M. Towle et al. v. Frederick Ambs.

      Filed at Ottawa January 19, 1888.

    1. Trusts and trustees—when a trust arises—in respect of land conveyed to one to perfect title and sell on joint accownt. The owner of land which had been sold under a deed of trust, conveyed the same to another, under a written agreement that the latter should take legal steps to have the trustee’s sale set aside and remove the incumbrance, and then sell the same, and after reimbursing himself for his outlays, account to the former for one-half of the remaining proceeds. The grantee, by a compromise with the purchaser at the trustee’s sale, acquired the title free of incumbrance: Held, that the person so holding the title thereby became the trustee of his grantor, and that it became his duty, as such, to sell the land for its reasonable value, and after deducting his advances, with interest thereon, pay over to the cestwi que trust one-half of the remainder of the proceeds.
    2. Same—fraud on the part of a trustee—in the sale of trust property at inadequate price—remed/y of cestui que trust. A trustee holding the legal title to real estate to be sold for the use of another and himself, is not justified in selling the same at half its real value, and when the purchaser is not a bona fide one, the sale will be set aside, in equity, at the suit of the cestui que trust. Facts and circumstances stated, from which a sale by a trustee to another, and a sale by the latter, are held fraudulent, and merely colorable, as against the cestui que trust.

    3. Same—loss of compensation by reason offraudulent conduct. Where a trustee holding land under a contract is to have an interest in the proceeds of the sale of the same for his services in clearing up the title and in dividing and selling the land, violates his trust, and seeks to dispose of the property for his own use, by making a fraudulent and colorable conveyance at a grossly inadequate price, he will lose all claim to any compensation for his services and all interest in the land.
    4. Same—rescission of contract, on account of am abuse of the trust. Where there is gross fraud on the part of a trustee in the execution of a trust growing out of a contract, by his seeking to appropriate the property of his principal to his own use, a court of equity will presume that the contract was made with a fraudulent intent on his part, and will not only set aside the fraudulent acts under the contract, but will rescind the original contract itself, and compel a conveyance to the principal.
    Appeal from the Circuit Court of Cook county; the Hon. Cybus Epleb, Judge, presiding.
    Mr. Alonzo Stephens, and Messrs. McCagg & Culveb, for the appellants:
    The decree makes Towle’s conduct subsequent to the execution of the trust, work a forfeiture, not only of the contract which created the trust upon which appellee’s interest is based, but also of the vested interest in said premises by Towle from parties entirely independent and distinct from any interest of appellee, and not even referred to in the contract between himself and Towle, the effect of which is to set aside the contract which created the trust, on account of the conduct of Towle subsequent to the creation of the trust. It is a familiar principle that a court of equity will never enforce a forfeiture, (2 Story’s Eq. Jur. sec. 1319,) and that a party to a contract can not rescind the same in part and affirm it as to the residue. Kimball v. Lincoln, 7 Bradw. 470.
    A trastee who has an absolute vested interest in one-half of the trust property, can not be deprived of such interest as a punishment for a failure to carry out the trust, but he can be compelled to account to the cestui que trust for his share of the trust property.
    In Franklin v. Osgood, 14 Johns. 527, it is held,—first, inadequacy of price, per se, is no ground for setting aside a conveyance, unless it be so gross as to be evidence of fraud; second, in judging of the adequacy of price, the condition and circumstances at the time of sale must be regarded; third, it is no objection to a sale by a trustee that it is made to his near relations; fourth, it is sufficient to support a sale by a trustee, that it was made bona fide, and for a valuable consideration, and that there was not negligence on his part. It is not necessary to show that he acted with the utmost possible prudence and sagacity.
    Mr. John Woodbridge, and Mr. Francis Lackner, for the appellee:
    In trying the question of fairness, the burden of proof rests on Towle. Ward v. Armstrong, 84 Ill. 154; Alexander v. Roderiquez, 12 Wall. 323; 3 Greenleaf on Evidence, sec. 253.
    The trustee must use the same care in his management of the trust which a man of ordinary skill would use in managing his own property under like circumstances, and is answerable for all losses, deficiencies and injuries which are occasioned by his affirmative or negative violation of this obligation. See 2 Pomeroy’s Eq. Jur. sec. 1070.
    A trustee is bound to communicate to his beneficiary any knowledge or information he may have obtained affecting the beneficiary’s interest, so far as it is embraced in or depends upon the trust relation. 2 Pomeroy’s Eq. Jur. sec. 1077; Davone v. Fanning, 2 Johns. Ch. 260.
    Trustees, for sale, must use every effort to sell the estate under every possible advantage of time, place and publicity. Perry on Trusts, sec. 770.
    The trustee should inform himself of the value of the property, if necessary, by the estimate of some experienced person; and if he sells at a grossly inadequate price, it is a breach of trust which affects the title in the hands of the purchaser. Stevens v. Austin, 7 Jur. (N. S.) 873; Wormely v. Wormely, 1 Brock. 330; 8 Wheat. 421.
    Both Smith and Gostlin purchased with notice of Ambs’ rights, because the contract was on record. If they had been bona fide purchasers for value, without notice, they could not successfully defend, because they paid but a trifling part of the purchase money. Roseman v. Miller, 84 Ill. 299; Baldwin v. Sager, 70 id. 505.
    The misconduct of Towle forfeits his right to the benefit of the contract, by which he was to have one-half of the net proceeds. Blanfelt v. Ackerman, 23 N. J. Eq. 497; McKnight v. Walsh, 23 id. 148; Lathrop v. Smaller’s Exrs. id. 192; White v. White, 89 Ill. 461; Brannan v. Strauss, 75 id. 235; Oard v. Oard, 59 id. 47; Jones v. Neeley, 72 id. 449; Jenkins v. Jenkins, 3 Mon. 329; Perry on Trusts, 602.
    As said in Oard v. Oard: “If the contract can not be re- ■ ferred to any other head of equity jurisdiction, it would be proper to presume that it was made, in the first instance, with a fraudulent intent.”
   Mr. Justice Magruder

delivered the opinion of the Court:

Stated generally, this is a bill filed by appellee, as cestui que trust, against the appellants, for the purpose of setting aside, on the ground of fraud, a certain sale made by the appellant, Marcus M. Towle, as trustee, and also for the purpose of com-polling the conveyance to appellee by appellants or some of them of certain lands, alleged to have been transferred by Towle and his grantee in violation of the trust. Towle held the title to the land in trust under an arrangement, by which he was to sell it, and, after reimbursing himself for advances of money made by him, was to divide the proceeds of sale equally between himself and appellee. The circuit court found that the disposition of the property by Towle was fraudulent as against appellee, and decreed that the transfers made by Towle and by his grantee should be set aside, and that all the land, except a small portion which had been conveyed to innocent purchasers, should be reconveyed to appellee. It was also decreed, that a certain amount found to be due from appellee upon an account stated should be paid into court for the benefit of appellants as their interests should appear, and that the trust should cease and the interest of appellant, Towle, in the land, so ordered to be reconveyed to appellee, should no longer exist. The decree so entered is brought before us for review by appeal from the circuit court of Cook county.

Stated more in detail, the facts, out of which the contention arises, are as follows:

Prior to July 1, 18Y9, the appellee had been the owner of an undivided one-half of a tract of eighty-four acres in Cook county situated near the Indiana State line and adjoining the town of Hammond. The other undivided half of the tract was owned by the appellants, Godfrey Snydacker and Bertha Snydacker, his wife. Appellee had borrowed about $4000 from Snydacker Bros., and, to secure the same, had executed a trust deed to Moses Snydacker upon his undivided forty-two acres. This trust deed was foreclosed and the property was sold by the trustee, Moses Snydacker, on July 1,1879, to Louis Frank. The trustee’s deed to Frank was recorded May 6, 1880. Appellee had no means. Appellant, Towle, was a prominent and wealthy business man of Hammond, a thriving manufacturing town in Indiana bordering on the Hlinois State line, and says, that, besides being in the real estate business, he was president of the First National Bank of Hammond, vice-president of the Tuthill Spring Company, proprietor of the Chicago Carriage Company, president of the Chicago Steel Manufacturing Company, president of the Western Salt Association and president of L. D. Latham & Co., a corporation engaged in the construction of railroads. It also appears from the evidence, that appellant, Towle, was a stockholder and director in the corporation, known as George H. Hammond & Co., engaged in the packing business at Hammond and having a packing-house on the State line, and that he continued to be a director therein until 1885, and was the superintendent of George H. Hammond & Co. until the fall of 1883. Appellee was desirous of setting aside the trustee’s sale of his land and of recovering back the title from Frank. Towle agreed to help him.

Accordingly, on February 3,1880, a written agreement was entered into between appellee and Towle, by the terms of which, after reciting the trust deed and trustee’s sale above mentioned, “it is agreed that the said Towle shall investigate the said title of the said Ambs, and if the said Towle, after such investigation, should decide that the interest of the said Ambs in said land is in such shape that the incumbrances thereon can be cleared off, and that the title to said land can be perfected, and if, after such investigation, the said Towle should conclude to clear off such incumbrances and perfect said title, then, in that event, the said Ambs agrees and binds himself that he will convey, or cause to be conveyed, to said Towle, his, the said Ambs’, interest in said land, whereupon the said Towle shall proceed to clear the said land of incumbrances, and perfect the title thereto, and sell, dispose, or make such use of such land, as he, said Towle, may see proper; but in case of said conveyance the said Towle shall take out of the first proceeds of said land all the money paid or spent by him in clearing off said incumbrances, and in perfecting said title, and in making and causing to be made all investigations of said title, and all his other expenses in connection with the handling of said land; and after all such payments by the said Towle, the residue of the proceeds of said land shall be equally divided between the said parties.” This contract was recorded in the recorder’s office of Cook county on October 20, 1880.

On April 10, 1880, Towle, having decided that the title to the land could be perfected, executed under his hand and seal to appellee a bond, the condition of which is as follows:

“The condition of the above obligation is such, that whereas the said Frederick Ambs has this day sold to Marcus M. Towle, the above obligor, the undivided one-half part of the north half of the south-east fractional quarter, and the north-east fractional quarter (lying south of the Grand Calumet river) of section 8, town 36 north, range 15, east of the third principal meridian, in Cook county, Illinois, which said sale is made subject to one certain trust deed to Moses Snydacker, which said Marcus M. Towle will endeavor to pay and redeem from any sale which may have been made under said trust deed; and if such redemption is made, said Marcus M. Towle will hold the aforedescribed land, and will make a sale thereof so soon as he shall, in his judgment and discretion, deem best, and will account to and pay over to the said Frederick Ambs an undivided one-half of the proceeds of the sale of the before mentioned land, after deducting therefrom all and every part of the money paid by said Marcus M. Towle for the redemption'of said land from the aforesaid trust deed, with the interest thereon from the date of payment until the repayment thereof by such sale, at the rate of eight per cent per annum,—it being hereby expressly agreed and understood that this bond is only for an accounting, and that it is not intended hereby to convey, or agree to convey, any interest whatever in the within described land.”

On the same day, April 10, 1880, appellee executed a deed to Towle conveying to him the undivided half of the eighty-four a'cre tract for an expressed consideration of $4000, which deed was recorded June 1, 1880.

On June 8, 1880, Towle filed a bill against Frank and the Snydackers to set aside the sale under the trust deed, making Ambs a co-complainant with himself in the bill. The suit so begun was settled before it came to a hearing. The settlement took place on July 22, 1881; by the terms of it Towle paid Frank or the Snydackers $7000 and received from Frank a deed to the premises.

Thus, on July 22, 1881, by the deeds from appellee and from Frank, Towle had become the holder of a clear unincumbered title to the property in question, and appellee owed him at that date, for advances made, the $7000 paid to Snydacker, and about $129 laid out for taxes, costs, etc. After this date it was the duty of Towle to sell the land, and, after deducting his advances and eight per cent interest thereon, to pay over to appellee one-half of so much of the proceeds of the sale as should remain.

After holding the title for over three years Towle and his wife made a deed of the land on October 2, 1884, to one Charles C. Smith, which deed was recorded on October 6, 1884. The consideration named in the deed was $14,000. Smith says that he paid $2000 in cash, assumed a mortgage of $5000, which Towle had given on the premises to Snydacker, and executed a mortgage to Towle to secure $7000 in notes, three of the notes being each for $2000 and payable in one, two and three years respectively, and one of them for $1000 payable in four years. The mortgage for $7000 was recorded on October 6, 1884.

On November 19, 1884, Smith and wife executed a deed, conveying the land to William H. Gostlin for an expressed consideration of $14,500, which deed was recorded November 24, 1884. Gostlin says, that he assumed the two mortgages above named of $5000 and $7000 respectively, and paid Smith $500 in cash and gave him his note for $2000 payable in sixty days.

On November 25, 1884, six days after Gostlin obtained the title, he and Snydacker, who owned the other undivided half of the eighty acre tract, sold five acres to George H. Hammond & Co. for $7500, or at the rate of $1500 per acre. In May, 1885, Gostlin and Snydacker sold one acre and a half to Mayer & Dracket for $3800, or at the rate of $2500 per acre. The decree of the circuit court, rendered on March 29, 1887, recognizes the validity of the two sales last named, amounting to six and one-half acres out of the whole tract, or three and one-fourth acres out of the land in dispute. In the accounting between appellee and appellants, appellee was given credit for'$3750, one-half of the $7500, and for $1900, one-half of the $3800, and these credits with interest thereon were applied in appellee’s favor in ascertaining the amount decreed to be paid into court for appellants, so that, as we understand the matter, neither party questions, upon this appeal, the Iona Jides of the sales by Gostlin to George H. Hammond & Co. and Mayer & Dracket. We understand, that the balance of the -undivided forty-two acres, after taking out the three and a quarter acres above mentioned, is still held by the appellant Gostlin.

The appellant Towle admits, that he held the property in trust and was bound to account to appellee for one-half of the proceeds of sale after taking out his advances, but he claims that he sold the property to Smith for $14,000 and that he should be allowed to settle with appellee upon the basis of that sale.

On the other hand, it is contended by appellee, that the transfers from Towle to Smith and from Smith to Gostlin were not bona fide sales, but that they were mere colorable transfers made for the purpose of defrauding appellee, and that Towle continued to be the real party in interest after his deed to Smith and after Smith’s deed to Gostlin. The circuit court found for appellee, the complainant below, upon this point, and we think the finding was correct.

In the first place, the property was deeded to Smith at about one-half of its real value. At $14,000 for the whole interest the property was conveyed to Smith on October 2, 1884, at about $350 per acre. The testimony shows, that it was then fairly worth $750 per acre, or about $28,000. In less than two months after it was deeded to Smith, two and a half acres of it were sold for $1500 per acre, and in about six months thereafter three-quarters of an acre of it was sold for $1900.

Appellants insist, that the sales to George H. Hammond & Co. and to Mayer & Bracket can not be regarded as fair eriterions of value. It is said, that George H. Hammond & Co., whose packing-house adjoined the land in controversy, had encroached upon it, and had built upon it valuable improvements costing many thousands of dollars, and that Snydacker had written letters to Mr. Hammond, the president of the company, threatening to dispossess him by suit and to bring actions for trespass and for cutting ice from the river, etc., and that, in consequence of all this, the company was forced to pay a large price. It is also said that Mayer & Bracket were running a- pavilion or dance-house on the Indiana side of the line, next to the land in controversy, and that they needed more room, and bought the acre and a half on the Illinois side, because they could sell beer in Hlinois on Sunday, which they could not do in Indiana, and because they could get license to sell liquor cheaper in Illinois than in Indiana. It may be true, that"the considerations here presented may have induced the Hammond Co. and Mayer & Bracket to pay more for that portion of the tract which they bought, than the balance of it could have been sold for to other parties. But we do not think, after a careful examination of the evidence, that these considerations account for the large difference between $350 per acre and $2500 per acre, or even between $350 per acre and $1500 per acre.

All the witnesses for appellee, who place the value at $750 per acre and who. are less interested than many of the witnesses for appellants, associated as the latter are with appellant Towle in his various enterprises in and about Hammond, do not base their estimates upon the sales to the Hammond Co. and Mayer & Bracket. Some of them base their valuations upon actual purchases made by themselves of neighboring lots. The tract in question was situated between Hammond, a place of 2500 or 3000 inhabitants, on the east, and West Hammond on the west, where there was a subdivision called Freitag’s subdivision, on which some forty or fifty houses had been built. South of it was Bussell’s subdivision, and, on the north, it had a frontage of sixteen hundred feet on the Calumet river. It was adapted for subdivision into lots and for sale in lots to the workingmen engaged in the packinghouses and various manufactories adjoining it and in its vicinity. Years before Towle took hold of it, appellee and Snydacker had made a subdivision of it and had sold several lots out of it. Mr. Hammond, a partner and business associate of Towle and not disposed to favor appellee, says, that he offered appellee $1000 per acre for the five acres in September, 1884, and that the value then and in October, 1884, was $1000 per acre. He had known the Ambs tract for eighteen years and had been identified with Hammond from its foundation. Snydacker says, that he was offered $20,000 for Ms half of the eighty acre tract in October, 1884, and refused it, and that, M his opinion, it was then worth $30,000.

Therefore, if the transfer to Smith had -been a real sale, Towle was not justified in selling for $14,000 a piece of trust property, which was worth $28,000. Even if there were special reasons, why the purchasers of the three and one-quarter acres were forced to pay a large price for them, appellee was as much entitled to the benefit of those reasons as was the appellant, Towle.

In the second place, the conclusion is irresistible from all the facts and circumstances developed in the testimony that Smith and Gostlin were not Iona fide purchasers of the property.

Smith and Towle were brothers-in-law; their wives were sisters. Smith had been working for George H. Hammond & Co. for twelve or thirteen years. In 1884 he was receiving a salary of about $20 per week. He had been in Hammond over fifteen years and, three or four years after he went there, married the appellant, Mary D. Smith. She was Mrs. Towle’s sister and then lived in Towle’s family and did the housework. When she went to the “State Line,” where the town of Hammond afterwards sprung up, Towle was in the butcher business with Hammond, and the firm was Hammond, Plummer & Co. A store was started, which Mrs. Smith seems to have attended to for Towle and to have had some interest in. Towle appears to have bought the goods for the store and they were shipped to Hammond, Plummer & Co. Towle boarded the butchers and the meat and groceries for them came from the store. The store was built on ground belonging to Hammond, Towle’s partner; the goods originally, were bought in the name of Hammond, Plummer & Co.; the bills were paid by Towle.

It is claimed, that Smith paid $2000 in cash to Towle and assumed mortgages for $12,000. He paid nothing on the mortgages. When asked where he obtained the $2000, he says that he received it from his wife; when asked how his wife came by the $2000, he says she got the money from Towle upon a note she held against him. Thus, the money which Smith paid to Towle came from Towle himself. Mrs. Smith claims to have owned an interest in the store, although the books do not show it. She says that she drew out of the business $2000, which she did not need and let Towle have it and he gave her the note for it. The books show no such amount drawn out, nor do they show any such amount repaid by Towle. Towle’s books, though full of details as to his other business, contain no record of the $2000 paid by him to Mrs. Smith or received by him from Mrs. Smith. A ledger of M. M. Towle, a book in the store, was produced on the trial. It shows an account with 0. C. Smith running from January, 1881, to March, 1883, from which Smith appears to have been indebted to Towle $6125.12. It is said that this was Mrs. Smith’s account; if so, it contains no credit for the $2000 paid to Towle. It is difficult to understand why, if this large amount was due from Mrs. Smith to Towle, it did not off-set the amount due on the note. Towle was in the habit of conveying property to Smith and his wife, and if there was any real consideration for these conveyances, none of the books of any of the parties show anything upon the subject. The testimony of Mrs. Smith and of Towle is contradictory in reference to many of these transactions. Mrs. Smith says, that Towle was her partner and her banker and paid all her bills. Towle says he paid her the $2000 in currency, and she says that she kept this currency in the house until she paid it to her husband, who handed it back to Towle.

We are satisfied from the relations, which existed between Towle and Smith and his wife, that the store in question, whatever interest Mrs. Smith may have had in it as a consideration for looking after it, was in reality Towle’s store, that the capital invested in it was Towle’s, and that the $2000 paid by Smith on the land came from Towle himself through the store. Moreover, Smith took his deed for the land in question, on the very next day after he and Towle concluded the arrangement, without demanding any abstract of title, or examining into or inquiring about the title. He was about this time foreman of the slaughter house of George H. Hammond & Co., in which Towle was a director, and paid $2000 in money and gave notes and a mortgage for $7000 without knowing or seeming to care whether he was receiving any title or not. He knew that the improvements of the corporation he was working for encroached upon the property when he received his deed. Before he conveyed to Gostlin, he was informed by Snydacker that the property was worth $1500 per acre, and yet he suffered Gostlin to take it for about $350 per acre.

As already stated, Smith deeded the land to Gostlin on November 19, 1884. Gostlin assumed the same mortgages which had been assumed by Smith, and says, that he paid Smith $500 and gave him his note for $2000 payable in sixty -days. There was a “still business” carried on at Hammond by the M. M. Towle Distilling Company. The stock of this corporation was $80,000, and Towle owned $60,000 of it. Gostlin was interested in this distillery with Towle. He had put in some machinery that he brought from Crystal Lake. He was paid a salary of $2000 by the distilling company, and had an interest of one-fourth in the profits after deducting his salary. He was a man of very little means, and the lots he had in Hammond seem to have been conveyed to him by Towle and his partner. He acted as overseer for Towle, while the latter was rebuilding his carriage works.

When Gostlin took his deed from Smith he demanded no abstract of title and made no examination as to the title. His negotiation with Smith was closed in fifteen minutes, and the $500 were paid and the deed was delivered on the same day, on which the negotiation took place, or on the next day thereafter. He says that he paid the note for $2000 which he gave to Smith with the proceeds of the sale of two drafts he had received from California from the sale of an interest in a vinegar factory there, and that these drafts were cashed for him by Towle. Smith says that, as soon as he received the $2000 from Gostlin he “put it in the business west—in an interest in a ranch.” He states that he and Towle owned a ranch in Kansas, he having bought a quarter interest from Towle, and the $2000 went at once into this ranch. It thus appears that the money Gostlin paid to Smith was applied to the use of one of Towle’s business enterprises.

After the property was deeded to Gostlin, some improvements were made on it; twenty-three acres of it were graded by one Weeks in the summer of 1885. Towle had a general store, consisting of groceries and dry goods at Hammond. Weeks was paid for his work by orders for goods drawn on Towle’s store. These orders were accepted and paid by Towle; they were first charged to Weeks on the books of Towle, then credited to Weeks on account of the labor performed by him; the books were balanced by charging the amount credited to Weeks to Towle’s private account. There was no charge to Gostlin on the books. In other words, the evidence shows that in 1885 Towle was paying for the improvement of property, which is claimed to have been sold to Gostlin in 1884. Within a. day or two before these books were produced upon the trial in the court below, it is proven beyond contradiction that some of the entries had been tampered with. For instance, before the item: “E. E. Weeks $100,” were written the words: “By W. H. Gostlin for,” so as to make the entry read: “By W. H. Gostlin for E. E. Wéeks, $100.” There was no other evidence in the books, that Gostlin had had anything to do with the payments to Weeks.

There are many other items of testimony, which we can not. comment upon without making this opinion too long. We are satisfied from a careful examination of all the evidence that Smith and Gostlin were made use of by Towle as mere covers for the purpose of carrying out a fraudulent scheme to deprive appellee of his full interest in this property.

It is contended on the part of the appellants, that, even if the transfers to Smith and Gostlin are set aside as to all the land except the three and one-quarter acres sold to innocent purchasers, yet Towle still has a right to claim one-half of the proceeds of the sale of the land undisposed of by Gostlin, on the ground that whatever fraud Towle may have been guilty of was not in obtaining the title from appellee and Frank, but in his subsequent efforts to sell the property. It is claimed, that the original contract between Towle and appellee was without fraud and fairly made, and that, therefore, Towle should not be deprived of his interest in that contract because of a fraud practiced by him subsequently to its execution. In other words, appellants insist, that, when Gostlin surrenders the portion of the property, to which he still retains title, such property falls back into the original trust and becomes subject to the provisions thereof, and that either Towle himself or some trustee appointed in his place should proceed to sell the property and divide the proceeds of the sale between appellee and Towle. The decree of the court below, while allowing to Towle or to Towle and Gostlin all their advances and expenditures together with interest thereon, directs a reconveyance of the remaining property to appellee freed from any interest of Towle therein. We think the decree in this regard was right.

The interest, which Towle was to have, under the contract, in the proceeds of the sale of the property, was to be his compensation for services as agent or trustee in clearing the title and selling and dividing the land. So far as the selling and dividing were concerned, he violated his trust and sought to dispose of the property for his own use and not for the use of the cestui que trust.

There are instances, where an agent or trustee, who fraudulently appropriates the property of his principal, will not he allowed any compensation. There are also cases, where, when there is gross fraud in the carrying out of a trust imposed by a contract, a court of equity will presume that the contract was made in the first instance with a fraudulent intent on the part of the guilty party, and will not only set aside the fraudulent acts under the contract, but rescind the original contract itself. (Frazier v. Miller, 16 Ill. 49; Oard v. Oard, 59 id. 47; Jones v. Neely, 72 id. 449; Brannan v. Strauss, 75 id. 235; White v. White, 89 id. 461.) We think the conduct of the appellant Towle was such a gross abuse of his trust as to justify a rescission of the agreement between himself and the appellee.

First, between February 3, 1880, and the fall of 1884 and while he was superintendent of George H. Hammond & Co. and a director thereof, he permitted that corporation to make extensive improvements, consisting of an ice house, repair shops, side-tracks, a brick well costing $1500, etc., upon the trust property without consulting appellee or accounting to him for rent or for ice taken from the river.

Second, on July 3, 1883, he borrowed $5000 for three years at seven per cent interest from Snydacker, and to secure the loan gave Snydacker a mortgage upon the trust property. This_money he used for himself in his own business. He never consulted appellee about making the loan nor informed him of it. Such a large mortgage covering the whole property was calculated to delay and interfere with its sale in lots and thereby prevent its sale in the mode which would realize the largest prices.

Third, in the spring of 1884 appellee called on Towle in company with one Stauhlbaum and asked Towle to buy his interest in the land and tried to make some arrangement to sell out to his trustee. On that very day Towle held a consultation with his lawyer about instituting a proceeding to have appellee declared a lunatic and to have a guardian or conservator appointed for him. Shortly thereafter and on April 29, 1884, Towle filed a petition in the circuit court of Lake county, Indiana, charging that appellee was of unsound mind and incapable of managing his estate, and asking for a trial and the appointment of a guardian. The summons in tbis proceeding was served on appellee on April 30, 1884. The proceeding was dismissed November 18, 1884, re-instated December 1, 1884, and dismissed again December 8, 1885. Towle preferred dealing with a guardian rather than with appellee himself.

Fourth, appellee repeatedly urged Towle to sell the property after July 22, 1881, and Towle constantly and steadily refused to take any steps in that direction. Ambs swears— and the conduct of Towle and all the facts and circumstances of the case tend to confirm him—that Towle claimed the property as his own and to have purchased it from Snydacker.

Fifth, when Towle deeded the property to Smith on October 2, 1884, he never informed appellee that he intended to do so, or that he had done so, nor did he consult him at all about such transfer. Appellee never learned of the conveyance to Smith until long after it was made, and, when he inquired of Smith what he had paid for the land, Smith refused to tell him.

Appellant, Towle, seeks to explain his failure to report to appellee the fact of the alleged sale to Smith by the statement that he had been garnisheed in a suit against appellee, and could not settle with him, until such garnishee proceeding was ended. The judgment in that proceeding, which was not paid by Towle until 1885, was for only about $1400. If the transfer to Smith had been a Iona fide sale, Towle'had money and notes enough in his hands to have reimbursed himself for his outlays and to have secured himself for the amount, for which he had been garnisheed; and, after all this had been done, there was still a balance in his hands in notes or money, which he could have divided with appellee and which it was his duty to have divided with appellee. Therefore, the garnishee suit was no excuse for his not reporting the Smith sale to appellee and dividing its proceeds with him, if, as is claimed by him, there was a sale to Smith.

Sixth, in addition to all the other evidences of bad faith in this matter, we are satisfied from the evidence, that before the appellant, Towle, deeded the property to Smith, he knew that five acres of it could be sold to George H. Hammond & Co. for $1000 or $1500 per acre, and he put the title into the hands of Smith and Gostlin, in order that he and they, and not appellee, might receive the benefit of such sale of the five acres.

The record presents such an outrageous attempt on the part of a rich and powerful man to defraud and crush his ignorant and poor neighbor, that it would be a mockery of justice to do otherwise than affirm the decree of the circuit court. Such decree is accordingly affirmed.

Decree affirmed.

Mr. Chief Justice Sheldon dissents from so much of the decree as inflicts upon Towle the penalty of a forfeiture of his one-half interest in the land, not perceiving upon what legal principle the appellee was entitled to such forfeiture.

Mr. Justice Shops : I concur in the dissent of Sheldon, C. J.


source: Caselaw Access Project

author: Mr. Justice Craig

license: Public Domain

text:
    Anson Z. Baits v. The People of the State of Illinois.

      Filed at Mt. Vernon January 20, 1888.

      1. Cbiminal law—whether felony, or only a misdemeanor—general rule. Where an offence may be punished by imprisonment in the penitentiary, or by fine, only, in the discretion of the court or jury, it is only a misdemeanor.
    2. Same—conspiracy—when only a misdemeanor. So the offences created by paragraphs 73 and 74 of section 46 of the Criminal Code, which define what is a conspiracy, and prescribe the punishment therefor, are only misdemeanors.
    3. Appeals and wbits of ebbob—in case of misdemeanor—jurisdiction. Where the offence of which a party is convicted is only a misdemeanor, this court has no jurisdiction of an appeal or writ of error to review the judgment for error, but the case must in the first instance go to the Appellate Court.

      Wbit of Ebeob to the Circuit Court of Fayette county; the Hon. J. J. Phillips, Judge, presiding.
    Mr. F. M. Guinn, for the plaintiff in error.
    Mr. Geobge Hunt, Attorney General, and Mr. J. M. Albebt, State’s Attorney, for the People.
   Mr. Justice Craig

delivered the opinion of the Court s

This was an indictment under paragraphs 73 and 74, section 46, of the Criminal Code. (Starr & Curtis’ Stat. p. 769.) The punishment provided for a violation of paragraph 73 is imprisonment in the penitentiary not exceeding three years, or a fine not exceeding $1000. Under paragraph 74, the punishment provided when a person is convicted, is a fine of not less than $100 and not more than $5000, and imprisonment, either in the penitentiary or county jail, for a period not exceeding two years. Sections 5 and 6, chapter 38, of the Criminal Code, (Starr & Curtis, 829,) provide: “A felony is an offence punishable with death, or by imprisonment in the penitentiary. * * * Every other offence is a misdemeanor.”

This statute was before us in Lamkin v. The People, 94 Ill. 501, and we there held, when the offence may be punished by imprisonment in the penitentiary, or by fine, only, in the discretion of the court or jury, it is only a misdemeanor. Here the plaintiff in error sued out the writ of error directly from this court to the circuit court, and the defendant having been convicted of a misdemeanor, the question is raised whether this court has jurisdiction. Section 88 of the Practice act is conclusive of the question. That act declares, appeals from and writs of error to circuits courts, the Superior Court of Cook county, the Criminal Court of Cook county, county courts and city courts, in all criminal cases below the grade of felony, shall be taken directly to the Appellate Court. The offence charged in the indictment, of which the defendant was convicted, being a misdemeanor, he could not sue out a writ of error in this court, but, Under the plain reading of the statute, he was bound to go to the Appellate Court.

The writ of error will be dismissed. Leave will be given plaintiff in error to withdraw record, abstracts and briefs, to be used in the Appellate Court, if he desires.

Writ of error dismissed.


author: Mr. Chief Justice Sheldon

text:
    Paulina Schaefer v. George Kienzel et al.

      Filed at Mt. Vernon January 20, 1888.

    1. Non-resident defendants in chancery—affidavit of non-residence —statement of defendant's residence. An affidavit of the non-residence of a defendant stated that such defendant’s residence was, “20th St. Louis avenue, St. Louis, Missouri:” Held, sufficient as to the residence of the defendant.
    2. Same—publication of notice—clerk's certificate as to mailing copy to non-resident. The printer’s certificate of the publication of notice to a non-resident defendant in chancery showed that the first publication was made July 25, 1884. The clerk, in his certificate, stated that he mailed a copy of the notice on July 19, 1884, and also that “within ten days of the first publication of the notice” he mailed the copy. The decree found that the copy of the notice was sent “within ten days after its first publication:” Held, that there was an evident mistake of the clerk in writing July 19, instead of July 29, and that the service was good.
    3. Notary rubric—whether seal to jwrat necessary—judicial notice. The circuit court will take judicial notice of the notaries public of the county in which it sits. Hence the jurat of a notary to affidavits made before him, to be used in his county, need not be authenticated by his notarial seal.
    4. The statute entitled “Notaries Public,” which requires them to provide themselves with seals with which to authenticate their official acts, relates only to such official acts as are in the contemplation of that act. That statute does not authorize notaries public to take affidavits and administer oaths. That power is given by another statute, which does not provide for any jurat, or mode of authenticating it.

      5. Pleading in chancery—allegation as to homestead. An allegation in a bill for partition that “A B is entitled to a homestead in said premises," is sufficient to authorize the court, on failure of any answer, to decree such person a homestead.
    6. Attorney’s fee m partition—as fixed by the master and approved by the court. A decree in partition was objected to, on the ground the court directed the master in chancery to pay the complainant’s solicitor a reasonable fee, without fixing the amount. The final report of sale fixed the solicitor’s fee at $15, and this report was approved by the court, and this was held to obviate the objection that the court itself did not determine what was a reasonable fee.
    Writ of Error to the Circuit Court of St. Clair county; the Hon. W. H. Snyder, Judge, presiding.
    Mr. William Winkelman, for the plaintiff in error:
    Paulina Schaefer has not been served with notice according to law. The copy of the notice was mailed to her six days before the first publication, and the affidavit for publication is uncertain in describing her residence, and was sworn to before a notary public, who fails to attach his seal.
    The bill fails to state facts constituting a homestead. It does not even contain an allegation that Justine ever resided or occupied the premises as a homestead. The allegation is, that Gottfried Tauhert died intestate in the year 187—, The truth is he died in 1867, but that fact is not in the bill,—at any rate, this court can not know when Gottfried Taubert died, except from the allegation in the bill, and that sufficiently shows that he died prior to July 1, 1872, at a time when a widow was not entitled to homestead in a suit for partition by the heirs. Eggleston v. Eggleston, 72 Ill. 24; Sontag v. Schmissem, 76 id. 541.
    The decree directs the master in chancery to “pay the costs and charges attending said sales, and those of this suit, including a reasonable solicitor’s fee for complainant’s solicitors, ” etc. This leaves the master to decide upon the reasonableness of the fee,—whether it shall be $10 or $100. That this was error is hardly necessary to comment on.

      Messrs. Dill & Schaefer, for the defendants in error:
    It is evident from the clerk’s certificate that ■within ten days after its publication he sent the notice, and the court expressly so finds. In Sloan v. Graham, 85 Ill. 26, it is held, “where the decree recites that the court found due and proper publication of notice, the presumption is that evidence sufficient to sustain the finding was heard by the court.” Moore v. Neil, 39 Ill. 256; Barnett v. Wolf, 70 id. 76.
    Again, it is urged the affidavit fails to state the residence of Mrs. Schaefer. By reference to section 12, supra, it will be seen that the only requirement is, that the affidavit shall state “the place of residence of such defendant, if known.” St. Louis was her place of residence. The affidavit states this, and more: it gives the avenue upon which she resides. This matter is of no importance, as there is no pretense that she did not get the notice. The absolute presumption is, that she received notice in due course of mail. Rosenthal v. Walker, 111 U. S. 185.
    Objection is made to the affidavit of non-residence, on the ground that the notary failed to attach his notarial seal. The circuit court takes judicial notice of who the notaries are in the county in which it is held, and proof of the official character of these officers is never required, unless that particular matter is distinctly in controversy. Stout v. Slattery, 12 Ill. 162; Rowley v. Berrian, id. 198; Shattuck v. People, 4 Scam. 478; Thompson v. Haskell, 21 Ill. 215.
    Again, we contend that no seal was required. Chapter 99, of the Bevised Statutes, entitled “Notaries Public,” requiring these officers to authenticate their official acts with a seal, went into force July 1, 1872. On July 1, 1874, chapter 101, revising “the law in relation to oaths and affirmations,” went into force. This latter act authorizes notaries to administer oaths, take affidavits, etc., and does not require the use of an official seal in these matters.

      It is next urged, that the circuit court erred in rendering the decree allowing Justine Taubert a homestead in the premises. The bill, in positive terms, alleges that she is entitled to a homestead, and her right to it is not denied by any pleading in the record. It is said, the bill fails to state facts constituting a homestead. Knapp v. Gass, 63 Ill. 495.
   Mr. Chief Justice Sheldon

delivered the opinion of the Court:

This was a bill for the partition of a town lot in the town of West Belleville, brought by Ernestine Kienzel, the daughter and heir-at-law of Gottfried Taubert, deceased, against Justine Taubert, the widow, and Paulina Schaefer, the other daughter and remaining heir-at-law of said Gottfried. There was a decree in accordance with the prayer of the bill. Paulina Schaefer brings the case here on error, and makes the following assignments of error:

First—That Paulina Schaefer had not been served with notice, as required by law. It appears from the printer’s certificate, that the first publication of notice was made July 25, 1884. The clerk, in his certificate, says that he mailed a copy of the notice on the 19fch day of July, 1884, it thus appearing, as is said, that the copy was mailed to Paulina Schaefer six days before the first publication of notice was made in the newspaper. The statute requires that the copy of the notice shall be sent within ten days after the first publication. The clerk states in his certificate, in addition, that “within ten days of the first publication of the notice in this cause,” he mailed the copy of the notice. The decree expressly finds that the copy of the notice was sent “within ten days after its first publication.” There was evidently a mistake, here, of the clerk, in writing July 19 instead of July 29.

It is objected that the affidavit of non-residence, and the notice, fail in stating the residence of Paulina Schaefer, it being stated as “20th»St. Louis avenue, St. Louis, Missouri,”— leaving it uncertain, it is said, whether the reference, here, of “20th,” is to the number of the house, or to Twentieth street and St. Louis avenue. The requirement of the statute is, that the affidavit shall state “the place of residence of such defendant, if known.” The affidavit does state this, and nothing more was required.

A further objection to the affidavit of non-residence is, that the notary public before whom it was made did not authenticate his jurat by his official seal. The affidavit was made before a notary public, in the county in which the court was-held that entertained the partition proceeding. In such ease, it was decided in Stout v. Slattery, 12 Ill. 164, that the jurat of the notary need not be authenticated by his notarial seal,—. that the court would take judicial notice of who the notaries public were in the county in which the court was held. Since that decision the statute entitled “Notaries Public,” (Rev. Stat. p. 721,) requires each notary public to provide himself with an official seal, with which he shall authenticate his official acts. We think this relates only to such official acts as were in the contemplation of that statute. That statute did not authorize notaries to administer oaths and take affidavits. It was a separate statute that did this,—the one entitled “Oaths and Affirmations.” (Rev. Stat. p. 725.) And this statute provides nothing as to any jurat, or mode of authenticating it. We think the decision in Stout v. Slattery still applies, and that it meets the present objection.

■Second—That the circuit court erred in rendering the decree allowing Justine Taubert a homestead in the premises. The bill was taken for confessed, no answer being filed. The-objection is, that the bill does not state facts which show that there was a right of homestead. The bill does allege that “Justine Taubert is entitled to homestead in said premises.” Knapp v. Gass, 63 Ill. 495, answers this objection. The bill there alleged that the widow, Mrs. Knapp, was entitled to dower in the land; and the widow, in her answer, averred that “she is entitled to her dower in the premises, as well as homestead.” No replication was filed. There was the same objection as here,—that there were no facts alleged out of which the right of homestead could arise, but a claim, simply, to a homestead in the premises. It was held, that failing to reply to the claim set up in the answer was an admission by the complainant that the widow had a homestead right in the premises, and that the allegation in the answer that the widow was entitled to homestead, was sufficient to warrant a decree for its allowance.

Third—That the circuit court erred in approving the commissioner’s report—that the report was manifestly wrong. The report found that the property was so circumstanced that a partition thereof could not be made without manifest prejudice to the proprietors, and set apart to Justine Taubert, as her homestead and dower, a life estate in all of the premises, and valued the premises, subject to such life estate, at $300. We fail to perceive that the report was not warranted by the statute, or that it should not have been approved.

Fourth—The final objection is, that the court erred in directing the master in chancery to pay (without stating the amount) complainant’s solicitors a reasonable fee,—that this left the master to decide upon the reasonableness of the fee. By the final report of sale of the master, the solicitor’s fee was fixed by the master at $15, and this report was approved by the court. This approval of the master’s report obviates the objection made.

The decree of the circuit court will be affirmed.

Decree affirmed.


author: Mr. Justice Scholfield

text:
    Mike Kirby et al. v. The People of the State of Illinois.

      Filed at Mt. Vernon January 20, 1888.

    1. Evidence—to show former conviction of witness for crime. Where a witness refuses to testify as to a previous conviction of a crime, it can be proved only, as at the common law, by a properly authenticated copy of the record thereof, and that must contain at least the caption, the entry showing the return of the indictment into open court by the grand jury, the indictment and record of arraignment, and the impaneling of the jury or the waiver of a jury, as well as the final judgment of the court. These are indispensable parts of the record.
    2. One of two defendants on trial for robbery testified in behalf of the defence, and on being asked if he had not been convicted of an assault with intent to kill, and sentenced to the penitentiary, declined to answer. The prosecution, over the objection of the defendants, read in evidence a certified copy of a judgment order of the Criminal Court of Cook county, sentencing the defendant to the penitentiary for two years and six months. No indictment or record of arraignment or trial was copied into this transcript: Meld, that the court erred in admitting the same.
    3. Ebbob wild not always bevebse—as, where it appears no injury resulted. This court will not affirm a judgment, when error has intervened, unless it shall appear from the whole record that such error could not reasonably have affected the result. When there is error, it is presumed to have improperly affected the result, but this presumption is rebutted, when, from the whole record, it is manifest that no improper result to the party complaining could have followed.
    Writ of Error to the Circuit Court of St. Clair county; the Hon. Amos Watts, Judge, presiding.
    Mr. William Winkelman, for the plaintiffs in error:
    The court erred in admitting in evidence the partial copy of the record of the conviction of Williams. Bartholomew v. People, 104 Ill. 601.
    Mr. George Hunt, Attorney General, for the People:
    In the case of Bartholomew v. People, 104 Ill. 601, it was the mittimus that was introduced in evidence, and the court held it error. In this case it was the judgment of the Criminal Court, properly certified, that was offered and admitted.
    Mr. B. D. W. Holder, State’s Attorney, also for the People:
    When a defendant in a criminal case elects to testify, he is to he treated, so far as cross-examination is concerned, as any other witness. Boyle v. State, 7 Crim. Law Mag. 659; State v. Beal, 68 Ind. 345; Burden v. People, 26 Mich. 162; Burbaker v. Taylor, 76 Pa. St. 63; Commonwealth v. Curtis, 97 Mass. 587; Wharton on Crim. Ev. (8th ed.) sec. 432.
    While contending that the admission of the record of the conviction of Williams was proper, yet we insist that it worked him no injury, and though it had been improper, it is not sufficient grounds for reversal. It is only when this court can see that the admission of improper evidence or the exclusion of proper evidence has worked an injury to the party complaining, that it will reverse for error in receiving or excluding the same. Railway Co. v. Zoffinger, 107 Ill. 199; Ritzman v. People, 110 id. 363; Peck v. Cooper, 112 id. 192; Windett v. Hurlbut, 115 id. 403.
   Mr. Justice Scholfield

delivered the opinion of the Court:

The defendants were each convicted of the crime of robbery, and sentenced therefor, to the penitentiary, for a term of years. The person alleged to have been robbed was Ferdinand Grot, who testified, among other things, that on the evening of the 5th of January, 1887, a short distance east of Bast St. Louis, while riding along the turnpike, in his wagon, he met the defendants, traveling in an opposite direction, in a buggy; that as they came opposite to him they stopped, and the defendant Kirby jumped out of the buggy, and then into the wagon of witness, and seizing witness, bent him back over the seat, put his hand into the vest pocket of witness, and took therefrom $40 in currency, after which Kirby returned to the buggy and the defendants drove off. The defendant Williams was introduced as a witness on behalf of the defendants, and testified, on his direct examination, that Kirby did not get into Grot’s wagon; that all that he did was to get out of the buggy, stand by Grot’s wagon, with his foot upon the wheel, and talk to Grot. On cross-examination, he was asked whether he had not been convicted, at the February term, 1881, of the Criminal Court of Cook county, of the crime of an assault with intent to kill, and sentenced to the penitentiary therefor, for the term of two years and six months, but he declined to answer the question. Thereupon, the court permitted the People, over the objection of the defendants, to read in evidence a certified copy of a judgment order of the Criminal Court of Cook county, rendered on the 29th of October, 1881, sentencing Williams to the penitentiary for the term of two years and six months. There is no indictment, no record of arraignment, and no record of the trial and return of verdict, copied into this record,— nothing but the final judgment order imposing punishment.

It is provided by section 6, division 12, of our Criminal Code, that “no person shall be disqualified as a witness in any criminal case or proceeding, by reason * * * of his having been convicted of any crime; but such interest or conviction may be shown for the purpose of affecting his credibility.” But how may such interest or conviction be shown ? Manifestly, in the absence of any statutory provision in that respect, the answer must be, as at common law. We said in Bartholomew v. The People, 104 Ill. 609, where precisely the same question, in principle, was before us that is here presented, “that at least the copy of the caption, the record of the returning of the indictment into open court by the grand jury, the indictment and record of arraignment, ” (and we now add, the record of the impaneling and verdict of the jury, or the waiver of the jury,) are as indispensable a part of the record as the judgment of conviction. We cited numerous authorities to sustain that position, and not one is cited now to the ■contrary. It was clearly error to admit this copy of only a part of the record in evidence.

There was other evidence affecting the question of the guilt ■of the parties, which we deem it unnecessary to discuss. It may he that the jury would have returned the same verdict they did had this evidence not been admitted, and that, had they done so, we would not feel called upon to disturb the verdict. But we are not to take the place of the jury, and determine, as an original question, whether the defendants -are guilty, and if guilty, how much punishment they should receive. We are only to determine whether there is error in the record, and if there is, are the defendants so clearly guilty that it could not have materially affected the result ? The rule is not, as quoted by the State’s attorney, that it is only “when the court can see that the admission of improper ■evidence or the exclusion of proper evidence has worked an injury to the party complaining, that the judgment will be reversed,” but it is, that the court will not affirm, where error has intervened, unless it shall appear from the whole record that such error could not reasonably have affected the result. When there is error, it is presumed to have improperly affected the result; but this presumption is rebutted, where, from the whole record, it is manifest that no improper result to the party complaining could reasonably have followed.

We feel hardly warranted, here, in saying that the judgment is, in all respects, so clearly right that it should be affirmed, notwithstanding the error. The judgment is therefore reversed, and the cause remanded for further proceedings consistent with "this opinion.

Judgment reversed,.


author: Mr. Justice Mulkey

text:
    The Ohio and Mississippi Railway Company v. Michael Wachter.

      Filed at Mt. Vernon January 20, 1888.
    1. Eminent domain—damages, present and prospective, involved in condemnation proceedings—as constituting a single cause of action—remedy. All special damages, present and prospective, to the owner of lands,, resulting or to result from the proper construction, maintenance and operating of a railroad, under the laws of this State, constitute, as to such land owner, one single, indivisible cause of action, which may be enforced under the Eminent Domain act, or any other appropriate form of action.
    2. Same—subsequent purchaser—of Ms rights in respect to such damages as were, or might have been, considered in the proceeding to condemn. Where such right of action has once accrued by the location and construction of a railroad, and the owner of the land thereby injured or damaged conveys it to another, the latter can maintain no action for any damages he may subsequently sustain, which might have been anticipated and allowed as prospective damages in any suit which his grantor might have brought in his own name.
    3. Same—of damages resulting from causes subsequent to condemnation, as affording a further cause of action. Notwithstanding the condemnation of land for a railroad, and the payment of the compensation or damages awarded the land owner, the company will be liable to him or his-grantee for damages resulting from its negligence, either in the construction, maintaining or operating_of its road.
    4. So where a railroad company, in constructing its road over a natnrai water-course, makes and maintains a solid embankment across such stream, with an insufficient culvert or opening to permit the free passage of water, or suffers such opening to be so obstructed as in ordinary floods and freshets, to throw the water back and inundate the lands above, it will he liable in damages to the land owner, in an action on the case. In such case, the payment of damages to the owner or his grantor, either in a proceeding to condemn or in an action, will afford no bar to subsequent damages.
    5. Same—taking property not necessary for road. A railroad company can not take, even by making compensation, any more land than is reasonably necessary for the purposes of its road; and the same principle must he applied to the damaging of property, for to permanently damage it is practically taking it to the extent its uses are impaired, though not a taking in the limited sense in which that word is used in the statute.

      6. Appeal—certificate of Appellate Court—not a limitation as to questions to be considered. Where the Appellate Court allows an appeal to this court on account of the importance of the questions involved, it may certify the specific grounds on which the appeal is granted, though not required to do so. But when a case is brought here on such certificate, it will be here for all purposes, and this court will be required to consider such questions as arise upon the record, the same as if the case came to this court in the ordinary way. To ascertain what questions thus arise, this court will look to the pleadings, the rulings of the court and the orders in the case, and not to the certificate of the Appellate Court allowing the appeal.
    7. Same—sufficiency of the declaration—open to question on appeal or error. It is a question of law whether a declaration discloses a cause of action which is always open to consideration in a court of review, when it falls within any of the assignments of error.
    Appeal from the Appellate Court for the Fourth District;— heard in that court on appeal from the Circuit Court of St. Clair county; the Hon. William H. Snyder, Judge, presiding.
    Messrs. Pollard & Werner, for the appellant.
    Mr. W. C. Kueefner, for the appellee.
   Mr. Justice Mulkey

delivered the opinion of the Court:

This is an appeal from the Appellate Court for the Fourth District, affirming a judgment of the circuit court of St. Clair county in favor of Michael Wachter, the appellee, against the Ohio and Mississippi Railway Company, the appellant herein, for the sum of $600 and costs. The form of the action was trespass on the caseA The first count charges, “that the plaintiff, at the time of the alleged grievances, was the owner, and in possession, of a certain brick-yard, with certain property situate thereon, in the town of O’Fallon, in St. Clair county, near which the defendant’s railroad was operated, and which crossed a natural water-course; that defendant had constructed and did unlawfully maintain a certain solid earth embankment across said water-course, about twenty feet in height, which obstructed the natural flow of the water, and forced it back upon adjoining lands; that defendant had constructed and was maintaining a culvert through the embankment, which was utterly insufficient to permit the free passage of water which, in ordinary floods and freshets, would naturally flow in said water-course and seek passage through the said culvert; that on or about June 20, 1885, a heavy rain storm set in, and a large quantity of rain-water naturally fell upon the lands adjoining said water-course, and said water naturally was drained and ran into said water-course, and would have escaped and run off without damage to the plaintiff, but for said embankment, but that said water was stopped by said embankment, and owing to the insufficiency and inadequacy of said culvert and opening in said culvert, was prevented from passing off in its natural course, and forced back upon and flooded his brick-yard and property thereon, to his great damage.”

The second count is substantially the same as the first, except that the negligence imputed to the defendant is its suffering the culvert to become choked up with obstructions, causing the water to back up and overflow the plaintiff’s property. The third count charges that the defendant wrongfully and unlawfully constructed and maintained the levee, without leaving a sufficient opening for the water to pass through the embankment. In other respects it was like the first and second. The defendant interposed the plea of not guilty, and upon this issue alone the cause was tried before the court and a jury, with the result already, stated.

Ro exception was taken on the trial to any ruling of the court upon the admissibility or exclusion of evidence, and while we find exceptions were taken to the court’s rulings upon the instructions, and that such rulings were assigned in the Appellate Court for error,, we may assume this was done merely pro forma, for no" objection to the instructions is urged in appellant’s argument, or even so much as suggested. Rot perceiving any objections ourselves to the instructions of which the appellant can complain, no discussion of them is called for, or could well be made.

Upon an examination of the record in the Appellate Court, we find there was a simple affirmance of the judgment of the trial court, without any finding of the facts by that court. In its opinion, however, there were questions,—or, rather, a question,—involved in the case, of sufficient importance to certify the cause to this court, which it has accordingly done. As just indicated, that court has appended to its certificate the specific grounds upon which the appeal was granted. That, however, we regard as merely advisory, for the reason the statute did not require it. Yet in many cases, if not in this, such a statement, though not required as a matter of duty, might subserve a good purpose by directing the attention of this court to the particular features of the case which, in the opinion of that court, were not regarded as free from question. Nevertheless, whenever a case is brought horn the Appellate Court to this upon a certificate, it is here, as if brought in the usual way., for all purposes. In either case, this court is required to consider such questions, and such only, as arise upon the record, and which it is by law authorized to determine. To ascertain what questions do thus arise,-we look to the pleadings, the rulings of the court and the orders in the cause, and not to the certificate of the Appellate Court allowing the appeal.

Viewing the present record in this light, it is not clearly perceived that anything remains for this court to do but simply to affirm the judgment, unless it were able to say, as matter of law, that the declaration discloses no cause of action,—this being always a question open to consideration in a court of review, when it falls within any of the assignments of error. "While there is no direct claim of this kind made, yet the question that appellant now asks us to consider, and which is the only one discussed in the brief filed by its counsel, seems to assert as much. Upon this view, therefore, it may not be improper to consider it. The question or proposition, as formulated by counsel, is: “The injury caused by the construction of an insufficient culvert in a railroad embankment is immediate and permanent, giving rise to but one cause of action.”

Counsel have cited in support of the proposition the following authorities: Ottawa, Gas Co. v. Graham, 28 Ill. 73; Illinois Central Railroad Co. v. Grabill, 50 id. 241; Chicago and Pacific Railroad Co. v. Stein, 75 id. 42; Toledo, Wabash and Western Railway Co. v. Morgan, 72 id. 155; Chicago and Alton Railroad Co. v. Maher, 91 id. 312; Decatur Gas Co. v. Howell, 92 id. 19; Chicago and Evanston Railroad Co. v. Loeb, 118 id. 203; Wabash, St. Louis and Pacific Railway Co. v. McDougall, 118 id. 229; Chicago and Evanston Railroad Co. v. McAuley, 121 id. 160,—none of which, in our judgment, sustain it.

The statement is not accurate as an abstract proposition, and even if it were, it is but in part applicable to facts of the case, and is inconsistent with the theory upon which it was tried by both parties. Considered as a general proposition, it should at least be limited to the case of a railroad built under authority of law and in a reasonably proper and skillful manner, so as to avoid the infliction of all loss and injury not necessarily resulting from thus building and operating the road. The proposition, as formulated, assumes that a railroad company has the right to construct and operate its road just as it pleases, without regard to whether the method adopted is sanctioned by good railroading or not; that it may build indifferent culverts, or none at all, over drains and streams on the line of its road, and by thus disregarding the ordinary rules observed in such eases, inundate and overflow, in time of freshets, large bodies of land and other property, without incurring any other or different liability, except as to extent of damages, than that of a company which, under like circumstances, has constructed its road-bed and culverts in strict conformity with the well recognized and approved methods of railroad building. We do not concur in this view.

The decisions of this court above cited, as we understand them, to go to the length of holding that all special damages, present and prospective, to the owners of lands, resulting or to result from properly constructing, maintaining and operating a railroad under the laws of this State, constitute, as to such land owner, one_single, indivisible cause of action, which may be enforced under the Eminent Domain act, or any other appropriate form of action. As a corollary of this doctrine, these cases further hold, that where, after such right of action has once accrued, the owner of land thus injured conveys it to another, the latter can maintain no action for any damages he may subsequently sustain, which could have been anticipated and allowed as prospective damages in any suit which his grantor might have brought in his own name. But this court has never held, nor is it prepared to hold, that a railroad company is not liable for damages resulting from its negligence, either in the construction, maintaining or operating its road. To do so would be to introduce an anomaly in the law of this State, and offer a premium for negligence and a willful disregard of duty.

A railroad company can not take, even by making compensation, more land than is reasonably necessary for the purposes of its road. This is universally conceded. The same principle must be applied to the damaging of property, for to permanently damage it is practically taking it to the extent its uses are impaired, though not a taking in the limited sense in which that term is used in our statute. Public health and convenience, as well as the positive law of the State, alike demand that railways leading over natural streams and drains, should, by means of efficient and substantial culverts, or otherwise, be so constructed as to admit the escape of accumulating waters through them, in times of high water as well as low. But experience show's that even these precautions which the law requires to be observed are often not sufficient to entirely protect adjacent property owners; hence the constitution of the State has expressly provided for compensation in such eases. But the providing of such compensation for unavoidable injuries to property was clearly never intended to license companies to overflow vast bodies of land which might be fully protected by the building and maintaining proper culverts. Now, in a case of this kind, when the company commences operating its road without having built such culverts, or provided some other efficient means for the escape of the water, is it thereby relieved of the duty of doing so altogether ? To say this, is to assert that one may discharge á legal duty by utterly disregarding it, which is simply absurd. To maintain an embankment of a road in that condition is not only a violation of a public duty, but is a direct invasion of the private rights of the owners of the lands thus constantly menaced by overflows which could never reach them if the road-bed were properly constructed.

To the suggestion that the company may be compelled to pay for this constant menace and consequent depreciation of the value and use of the land in times of overflow, it is sufficient to say that he is under no obligation to submit to a partial loss which could be avoided by the performance of a legal duty that the company owes to him. It is, in effect, forcing one to sell his property under the forms of law, in the absence of any public necessity justifying it. The remedy is to compel the company to properly construct its road, and until that is done, hold it responsible for all damages resulting from such failure of duty.

There are decisions to the effect, that where, in a case like this, the plaintiff has treated the injury as embracing prospective as well as present damages, and has offered proof in support of such claim, there can be no further recovery. These decisions rest upon the principle of estoppel, and are consequently sound; but no such question arises in this case. Yet it does not follow that because a land owner, under the circumstances suggested, would be estopped from bringing a second suit, the company would be relieved of the public duty to properly construct and maintain its embankment, and it would therefore continue liable to all persons injured by its failure to do so, except such as might be estopped, in the manner we have stated, from enforcing a claim of that kind.

The judgment will be affirmed.

Judgment affirmed.