author: MR. PRESIDING JUSTICE ENGLISH

text:
    Leo William Conway, Plaintiff-Appellee, v. The Belt Railway Company of Chicago, Defendant-Third Party Plaintiff-Appellant, v. Greenwood Lumber, Inc., Third Party Defendant-Appellee.
    Gen. No. 50,367.
    First District, Fourth Division.
    September 22, 1967.
    Rehearing denied October 25,1967.

      Richard F. Koproske and Glen H. Carrier, of Chicago (Glen H. Carrier, of counsel), for appellant.
    Ernst Liebman and Charles Pressman, of Pressman & Hartunian, and Berchem, Schwantes & Thuma, of Chicago (Michael J. Thuma, of counsel), for appellees.
   MR. PRESIDING JUSTICE ENGLISH

delivered the opinion of the court.

Defendant Belt Railway appeals from a jury verdict and judgment for the plaintiff in an action for injuries sustained on August 12, 1958, while unloading beams from a gondola car delivered to plaintiff’s employer, Greenwood Lumber, Inc., by The Belt Railway Company. There were six beams, each 49 feet in length, 9 inches wide and “V” shaped at the middle, packaged in two bundles, three beams to a bundle. Each bundle weighed about 8,780 pounds and was loaded with the “V” resting on the flooring of the car, with each end about 4 feet from the floor. Vertical timbers, or “stakes,” had been placed around the sides of the car and between the two bundles to keep the beams from touching the sides and each other. At each end of the gondola car a “six-by-eight” timber was bolted to and lay across the top and width of the car under the protruding ends of the beams, thus forming a cradle which held the ends of the beams off the floor and kept them from tipping forward or backward.

On August 7, 1958, the six beams, weighing a total of 17,560 pounds, had been loaded by Super Structures, Inc., in Albert Lea, Minnesota, into gondola car No. 2715 of the Chicago, Rock Island and Pacific Railroad Company for ultimate delivery to the King Building Supply Company in Chicago, Illinois. The car was made of steel, with a length of about 65 feet and sides approximately 3% to 4 feet high. The Rock Island Railroad transported the beams to Chicago, where the car was turned over to the Belt Railway for delivery to Greenwood Lumber, Inc. The Belt Railway is owned by some twelve other railroads and serves as an interchange railroad in and around Chicago, taking railway cars delivered to it by one railroad and redelivering the cars to industries or to other railroads for further transportation.

When the car was turned over to Belt by the Rock Island, two inspectors of Belt inspected the car at some time between 1:00 and 2:00 a. m. on August 10, 1958, and found nothing wrong with the car or its load. On August 11, 1958, the car, with its load of beams, was pushed by a locomotive off the main Belt line down a slight grade onto the single east-west track in the Greenwood yard. Mr. Bournazos, the president of Greenwood, saw that damage had occurred to the load, and notified Belt to send an inspector. Mr. Rodeck, of Belt, went to the Greenwood premises to inspect the load and found that a cradle, used to support the beams in the west end of the car, had broken, that the southern bundle had shifted to the west at least two feet and was tilted to one side so it was lying against the northern bundle. He also determined that some damage had occurred, but could not assess the full extent with the bundles still in the car.

At trial, Rodeck testified as to the customary procedures of Belt and to his actions on August 11. (Since plaintiff and defendant both consider Rodeck’s testimony to have great bearing on this appeal but differ as to the interpretation this court should adopt, we must examine the testimony in some detail.) Inspectors for Belt inspect each car as Belt takes delivery. They check for damage to the car and also to see whether the lading may have shifted or otherwise become unsafe. As we read the record, Rodeck meant that this safety element applies to further switching operations of Belt and has no application to whether or not the lading would be unsafe for unloading purposes. When asked specifically, “What was the purpose of determing whether or not a load had shifted?” Rodeck answered:

Well, it would be for our protection more than anything else, because if the load is shifted, there’s in all probability damage to that load, not only damage, but there is a possibility that in the process of switching, this load could become undone from the car and somebody could get hurt. (Emphasis supplied.)

Continuing, it is customary for a car inspector, on finding an unsafe condition, to attach a green tag, approximately 3x8 inches, indicating, “the initial, the number, and the time the car was mail-ordered, the road we received the car from, the track it came in on, what yard it was received in, and who the inspector was that made the inspection.” He found car No. 2715 and its lading too in “bad order condition,” but did not affix a green bad-order tag even though he had some tags in his automobile a short distance away. Rodeck said the car was unsafe to move because the lading had shifted. As to why he did not “green tag” it, there is no direct testimony, but he did testify that the usual procedure was to inspect cars in the Belt yards and to green tag them at that time. There was no testimony that an inspection made on premises of a consignee ever required a green tag, and, consistent with our interpretation of the purpose of such a tag, there would seem to be no need to tag a car as unsafe for further switching because of shifted lading once that car has been delivered to the place where the lading is to be removed.

A second type of form, a “bad-order form,” MCB-40, was generally completed when a car was received in bad condition. This form would show damage to a car and was for the internal use of the railroad to indicate “what is to be done with or to the car.” Rodeck did not fill out one of these, but it is not contended that he found damages or defects in the car itself. Rodeck did complete a “The Belt Railway Company of Chicago Inspector’s Report of Loss of Damaged Freight,” which briefly described the visible damage, and noted that, “Due to the fact the car was not unloaded the full extent of damage could not be determined .... Mr. Finnegan — Claim agent — notified.” Rodeck then left the Greenwood premises. According to his testimony, he “did not instruct [the Greenwood people] how to unload [the car, nor did he] offer to have the railroad unload it.”

Bournazos testified that he proceeded to unload the car on Rodeck’s “go-ahead” sign in order to determine the full extent of the damage. There was evidence that King Building Supply Co., the ultimate receiver of the beams, was in a hurry to get their order from Greenwood. There was no evidence that Greenwood rejected the load or did anything to indicate more than the fact that they might file a claim for damages incurred through the shifting of the lading while in transit. On cross-examination, Bournazos testified that the purpose of Rodeck’s inspection was only to establish damage to the beams (King Building Supply did subsequently make a claim), and that King was the company for whom the beams were being unloaded, since the job of Greenwood was to receive, unload, and take the beams to a work site.

On August 12, 1966, Mr. Bournazos and two of Greenwood’s employees, Nicholson and plaintiff Conway, proceeded to unload the car. They chained the west end of the south beam to the side of the car as a precautionary measure, but left the east end of the beam free. Using a chain hoist and a forklift truck, they raised the north beam to about four feet from the floor of the car, the greatest height their equipment would permit, a preparatory to swinging the north beam out over the side of the car and then to the ground. At this point, Bournazos was operating the forklift truck and Nicholson the overhead electric hoist. Before the beam could be swung clear of the car, a four-by-four stake had to be removed from the north side near the east end of the car where it had been attached as one of several protecting stakes used to keep the beams from the sides of the car during transit. The top of the stake projected above the side of the car and its height exceeded the lifting capacity of the equipment. Plaintiff argues that the north beam had to be lifted before the stake could be removed. Defendant maintains that Greenwood forgot to remove the stake and did so after the lifting of the north beam and at great peril to plaintiff, and that therefore the employer’s negligence was the chargeable cause of plaintiff’s injuries.

Plaintiff left the car from the west end during the raising of the north beam. He then reentered the car at the west end, walked the length of the car under the raised beams to a point near the east end where the stake was attached. With the aid of a pair of pliers, he removed some wire from the stake, tossed it to the ground and turned to leave the car from the east end when he saw the east end (the end that had been left unchained) of the south bundle slowly moving toward him. It was then only a few inches away and he vainly put out his hands to stop it but the beams pinned him against the side of the car. He was squeezed until he turned blue and after Bournazos and Nicholson managed to place supports under the north bundle and employ the forklift to free Conway from the south beams, they gave him artificial respiration and revived him from unconsciousness. Plaintiff was severely injured as a result of the accident.

Defendant’s first major contention is that while this precise factual situation is one of first impression in Illinois, under established general rules a delivering carrier owes to the consignee and his employees no more than the duty to reasonably inspect the car and lading and then to either repair or warn the consignee of any conditions which render it unsafe for unloading. In this case, defendant argues, the consignee and his employees were experienced in unloading freight cars, saw the damaged condition of the lading yet accepted delivery and commenced to unload, and, therefore, defendant owed no further duty to the plaintiff upon which an award for negligence may properly be founded. Plaintiff argues that the carrier’s duty to provide the consignee and his employees with a safe place to work includes the unloading of damaged lading and does not terminate when the employee has notice of the existence of a defect; that therefore the jury properly found the negligence of Belt to be the proximate cause of plaintiff’s injuries.

We find the duty of the delivering carrier, defendant in this case, not to encompass the unloading process whereby plaintiff was injured, since the injury was not occasioned by any defect, latent or otherwise, in the car itself, but, rather, by a damaged condition in the lading of which plaintiff and his employer were fully cognizant when they nevertheless undertook to remove the shifted bundles from the car. A carrier owes his consignee the duty to inspect so as to provide a car reasonably safe for the purpose for which it is intended. Maher v. Chicago, M. & St. P. Ry. Co., 278 F 431, 434-435 (7th Cir, 1921); Erie R. Co. v. Murphy, 108 F2d 817 (6th Cir, 1940); Wintersteen v. National Cooperage & Woodenware Co., 361 Ill 95, 197 NE 578; Rylander v. Chicago Short Line Ry. Co., 17 Ill2d 618, 161 NE2d 812, affirming 19 Ill App2d 29, 153 NE2d 225. However, this duty does not cause the carrier to be an insurer of possible injuries proximately caused by the unloading of damaged lading where any such defects are visible and unrelated to the condition of the car itself.

In Rylander v. Chicago Short Line Ry. Co., 17 Ill2d 618, 161 NE2d 812, a carrier was held liable to an employee of the consignee for injuries sustained due to a fall from the top of a railroad “tank” car while it was being unloaded. A bolt on top of the car, which the carrier had delivered, was coated in creosote and broke when the employee tried to tighten it, thus causing his fall. The duty which the carrier was held to have breached was that of reasonably inspecting the car to discover such defects. Contrary to plaintiff’s contention, Rylander does not, therefore, establish an additional responsibility on the part of the carrier during the unloading process. Because a carrier must provide a safe car from which to unload, does not mean the carrier must also assume responsibility for the unloading of obviously shifted and damaged lading.

The defendant here did not fail to make a proper inspection. When Belt took delivery, there was no damage found to either car or lading. Consequently, the car was not tagged as unsafe for further switching. After delivery to the consignee, damage was reported and Belt then made another inspection, this report showing damage to the lading as a result of its having shifted at some undetermined time. As noted above, we do not see why there was any need for Rodeck to tag the car at that point, as further transit was not contemplated and there was no damage to the car itself. From the testimony of Rodeck, plaintiff infers that defendant still considered the car and lading as its responsibility and that plaintiff unloaded the beams at defendant’s request for the purpose of assisting defendant in making a complete inspection of the damaged lading. We do not so read the testimony. There is no evidence that defendant, through Rodeck, ever assumed responsibility for the unloading or offered any advice to the consignee as to whether or how the process should be performed. In fact, Rodeck categorically denied any such inference, and the mere fact that he gave Bournazos his “go ahead” cannot properly support a conclusion to the contrary. It is unreasonable to impart more to Rodeck’s “go ahead” than that as far as Belt was concerned, the consignee could do with the load as they wished without jeopardizing any future claims for damage to the beams since Belt knew from the observation of its inspector that damage had occurred for which claim might be made against it.

Since defendant discharged the duty of inspection found in Rylander and did not voluntarily assume responsibility for unloading, to support the award of damages to plaintiff there must have been a breach by defendant of some other legal duty which proximately contributed to plaintiff’s injuries.

In Shipley v. Southern Pac. Co., 44 Ill App2d 1, 193 NE2d 862, we held that a carrier which did not load some plywood, which shifted during transit and during the unloading of which the consignee’s employee was injured, owed no legal duty to inspect the condition of the lading to determine whether it was safe for unloading, since the carrier only received the sealed car and delivered it. In answer to the contention (based on Rylander and similar cases), “that defendant ... is liable for failing to deliver the car in a reasonably safe condition for unloading,” we specifically distinguished those authorities on the same grounds pertinent here: “These cases involve the duty of the carrier to inspect and discover a defect in the car itself.” (44 Ill App2d at 4.) In Rollins v. General American Transp. Corp., 46 Ill App2d 266, 269, 197 NE2d 68, Shipley was cited for the following proposition :

At the time of unloading there was no control, supervision, or direction by any of the defendants. Since (plaintiff’s employer) was lessee, consignor, consignee, there was no duty on the part of (defendant) as to unloading.

Factually, Shipley and the cases relied upon therein, are distinguishable in that the carriers there only received and delivered sealed freight cars, whereas here the gondola car was not sealed. Irrespective of this variation in fact, we feel the principle of law should be the same in both situations. The carrier’s responsibility should be no greater simply because it has access to the lading in an open car. As noted, the lading was inspected with the car at the Belt yards and at the Greenwood premises to determine whether the car was thereby rendered unsafe for further transit. That a carrier may be liable for cargo damage is not determinative of whether it is also responsible for injuries sustained during the unloading of that cargo where such injuries are not attributable to any defect in the car supplied by the carrier.

The factual situation here is even more compelling toward nonliability of the carrier than in Shipley where the car was sealed, since here the fact that the lading had shifted was obvious and apparent:

“We are aware of no valid reason for holding that a carrier is under a duty to give notice or warning of a condition which is so visible that any danger therefrom must be apparent to and appreciated by a person of ordinary intelligence, prudence, and experience who undertakes the unloading of a car.” (Nashville Bridge Co. v. Ritch, 276 F2d 171, 179 (5th Cir, 1960) quoting from Southern Ry. Co. v. Edwards, 44 F2d 526 (5th Cir, 1930).)

See also United States Steel Corp. v. McCraney, 257 F2d 457 (5th Cir, 1958).

We do not decide whether plaintiff’s injuries were caused by his own negligence, or by his employer, the consignee, or whether there was any negligence at all. We do not find that there is no breach of any legal duty by a carrier, upon which liability may be founded, when injuries occur in the process of unloading damaged lading, in the absence of proof of a defect in the car itself which caused or contributed to the injuries, where the damaged condition of the lading is known to the consignee, where the consignee is shown to be experienced in unloading, and where the carrier has not voluntarily assumed any responsibility for the unloading.

Other points raised on this appeal are not considered, as they are not essential to our decision.

The judgment of the Circuit Court is reversed, with judgment here in favor of defendant, The Belt Railway Company of Chicago.

Reversed.

DRUCKER and McCORMICK, JJ., concur.

       See also Oklahoma City-Ada-Atoka Ry. Co. v. Crabtree, 207 Okla 327, 249 P2d 445, 446-448; Bachmann v. Chicago, M., St. P. & P. R. Co., 266 Wis 466, 63 NW2d 824, 827; Missouri Pac. R. Co. v. Carey, 138 Ark 563, 212 SW 80, 81-82; Oklahoma City-Ada-Atoka Ry. Co. v. Riddle, 183 Okla 318, 82 P2d 304.

       Roceo v. New York Cent. System, 7 Misc2d 286, 166 NYS2d 371; Lewis v. New York, O. & W. Ry. Co., 210 NY 429, 104 NE 944; Seeden v. Great Northern R. Co., 242 Minn 360, 66 NW2d 178; Butler v. Norfolk Southern Ry. Co., 140 F Supp 601 (DC NC, 1966); Reed v. Missouri-Kansas-Texas R. Co., 362 Mo 1, 239 SW2d 328, 332. (Actually, in Reed, the injury resulted from supporting stakes on a flatcar inadequate to prevent a load of power-line poles from falling on plaintiff. The court found the stakes to have been placed by the shipper who did the loading and that they did not constitute a defect in the railroad equipment for which the carrier would have otherwise been responsible.)


source: Caselaw Access Project

license: Public Domain

text:
    Estate of Sadie Julia Ross, Deceased. Anna M. Peters, Also Known as Anna M. Ross, as Executrix of the Estate of John J. Ross, Deceased, Petitioner-Appellant, v. Albert M. Werner and Harold E. Cornue, Executors Under the Will of Sadie Julia Ross, Deceased, et al., Respondents-Appellees.
    Gen. No. 51,317. (Abstract of Decision.)
    First District, Second Division.
    September 22, 1967.

      Nat M. Kahn, of Chicago, for appellant; Gregory A. Gelderman, of Chicago, for appellees.
   Opinion by PRESIDING JUSTICE LYONS. Not to be published in full.


text:
    In the Matter of the Estate of Jay Samuel Hartt, Deceased. Sylvia Mona Hartt, Petitioner-Appellant, v. Harris Trust and Savings Bank, Executor of the Last Will and Testament of Jay Samuel Hartt, Deceased; Jane Hartt and Michigan State University, Respondents-Appellees.
    Gen. No. 50,284.
    First District, Fourth Division.
    September 22, 1967.

      Springer & Hansen, of Chicago, for appellant.

      John H. Thomson, of Vedder, Price, Kaufman & Kamm-holz, and Lennon, King & Denniston, of Chicago, for ap-pellees.
   MR. PRESIDING JUSTICE ENGLISH

delivered the opinion of the court.

From a judgment denying her petition for distribution of $8,000 or more, which she alleges is intestate property from the estate of Jay Samuel Hartt, plaintiff appeals, contending that since decedent’s will contained no provisions directing or authorizing the accumulation of unexpended or undistributed property and because his widow renounced her share, plaintiff, as sole remaining heir-at-law, is entitled to the intestate property.

On April 13, 1962, Jay Samuel Hartt died testate, leaving as his sole heirs-at-law his widow, Phyllis Ann Hartt, and his sister, plaintiff, Sylvia Mona Hartt. The will was admitted to probate on June 1, 1962, and the defendant, Harris Trust and Savings Bank, was appointed executor and cotrustee. Decedent’s widow filed her renunciation of the will on November 28, 1962, and plaintiff filed her petition for distribution on August 13, 1964.

The defendant contends, as at trial, that the will does authorize accumulation of income not required or, in the trustee’s discretion, permitted to be distributed, and that, therefore, the remaining sum of money should pass through the residuary clause of the will to Michigan State University, the named beneficiary thereof.

After other provisions not here relevant, the will of decedent created two trusts, the first of which, Trust “A,” was for the benefit of his wife. All the income of Trust “A” was to be paid directly to the wife, and the Trustees were authorized to invade the principal if, in their discretion, it became necessary to provide adequately for the widow’s continued comfort and needs. At her death, the trust was subject to her testamentary power of appointment. Failing a valid exercise of this power, the entire remaining principal was to be added to and become a part of Trust “B,” subject to and administered as per the directions applicable to that trust. In case the wife predeceased the testator, or if Trust “B” had terminated, the principal was to pass through Paragraph 7 to Michigan State University, the named beneficiary. This appeal presents no question specifically applicable to Trust “A.” The question concerns Trust “B” insofar as income not distributed thereunder has accumulated.

Testator created Trust “B” in Paragraph 6 of his will to provide annual payments to one Jane Dempsey and to plaintiff of:

“. . . so much of the income and, principal of Trust ‘B’: as shall be necessary in the uncontrolled opinion of the Trustees ... to provide for her comfortable support maintenance and welfare, . . . .” (Emphasis supplied.)

In subparagraph (c) of Paragraph 6, testator limited the amounts payable to plaintiff and Jane Dempsey:

“ (c) Payments . . . shall not exceed . . . $7200 a year . . . taking into consideration all other income of which the Trustees have knowledge which is available to either of said persons. The Trustees are also authorized to pay, over and above the limitation . . . such additional amounts as may be required, in the uncontrolled discretion of the Trustees, ... to pay unusual or extraordinary expenses 99

Testator further provided:

“(d) If at any time Trust ‘A’ shall have been exhausted in the support of my wife, . . . then my Trustees shall use so much of the income from and principal of Trust ‘B’ (limited to $4,000 per year) as may be necessary . . . and . . . without endangering further payments to Jane Dempsey, or my sister, . . . under subparagraphs (a) and (b) above . . .

In Paragraph 7(b), testator willed that:

. . when the Trustees have discharged all obligations of Trust ‘A’ and Trust ‘B’, said Trustees shall pay over to Michigan State University . . . the remaining principal and income of Trust ‘B’ and the principal of Trust ‘A’ which has not otherwise been disposed of through the valid exercise of the power or appointment granted to my wife . . . (Emphasis supplied.)

Plaintiff argues that courts must consider the language used in a will when construing it in order to ascertain the intention of the testator; that a court cannot properly guess as to what the testator may have wished to provide where the language used does not permit accumulation of undistributed income; that such an authorization must be express where income exceeds the requirements of trust payments; that here the language not only does not authorize accumulation, but actually indicates that testator did not intend accumulation of income since he directed the Trustees to make payments of “income and principal”; and, finally, that where there is no provision for the disposition of excess income and no provision for its accumulation, it will pass as intestate property.

Defendant agrees that the prime duty of the construing court is to ascertain and give force to the intentions of the testator as found in the will, so long as such intent is valid; that where, as here, the testator disposes of his estate by will, there arises a presumption that he did not intend any partial intestacy and that courts will adopt any reasonable construction to avoid partial intestacy, since the presumption will be rebutted only where the contrary interpretation clearly appears; that a residuary clause in a will also raises the presumption that testator intended the designated beneficiary to take, rather than unspecified heirs who would take under intestacy statutes; that testator’s authorization for accumulation can be implied from the stated terms of the will as well as the general scheme of distribution and consideration of the entire will, and that there needn’t be a specific expression of such authorization; and that, therefore, no intestacy exists as to the undistributed income in this case.

The authorities advanced by all parties to this appeal raise no unsettled questions of Illinois law and present no difficulty or disagreement insofar as they pertain to the proposition that the primary duty of a court is to ascertain the intent of the testator in a legally valid will. It is likewise true that the court must not engage in conjecture in its construction, since the intention to be carried out must be found on the face of the will, and, further, if there are contingencies for which the testator did not provide, either through faulty draftsmanship or oversight, the court will not supply remedial provisions. Nevertheless, the court will look to the entire will and not construe intent merely from isolated and non-contextual language where to do so would violate the overall expressed intent. Therefore, the essence of this appeal is whether the testator expressly authorized the Trustees to accumulate income which the will did not require, or permit them to distribute. If the authorization to accumulate is not found, then the contested sum would pass as intestate property and the judgment must be reversed. (Ill Rev Stats 1963, c 3, §§ 11, 16, 51.)

We find from the language creating the trust and the general scheme of distribution, as evident in consideration of the entire will, that testator intended the Trustees to have power to accumulate the excess income in Trust “B.” In subsections (c) and (d) of Paragraph 6 (quoted above), testator set limitations on the annual payments to each beneficiary of $7,200, but directed the Trustees to augment those allowances if they deemed it necessary. Therefore, the amounts payable to these beneficiaries were flexible up to and even in excess of $7,200. In the Trustees’ discretion, payments could be made from either income or principal, and the guide was to be the needs of the individual beneficiaries, with consideration given to other income and an assessment of the standard of living in each case. There was no direction for the Trustees to pay first from income of the trust and invade principal only when necessary, nor was there any mention of the estate’s earning capabilities as an indication of the size of the payments or limitation thereon. Therefore, it seems clear to us that the testator contemplated use of income and principal as a common fund, with no distinction between the two for this purpose.

This question was considered in Hartford Nat. Bank & Trust Co. v. Yearly Meeting, 137 Conn 648, 81 A2d 104, 107 (1951), wherein the Supreme Court of Errors noted that testator had provided for annual payments from either income or principal, and held:

“It is apparent that the testator contemplated the possibility that in some years the income might shrink to such an extent that it would be necessary to use principal to pay the annuities. He, however, made no provision for the recoupment of the principal out of surplus income in other years, as would have been natural if his intent had been to keep the income and the principal as two separate funds. The language employed evidences the testator’s intent to create a ‘trust fund’ comprised of income as well as principal.”

In further evident disregard of any need for the Trustees to distinguish between income and principal, the testator provided in 6(d) that income and principal up to $4,000 per year should be used if necessary to supplement payments being made under Trust “A,” so long as it would not endanger payments directed under Trust “B.” This shows not only a desire for the Trustees to treat income and principal as a common fund, but also that testator contemplated that the amounts available in Trust “B” would vary, depending on trust earnings and particularly because payments made to the two beneficiaries would depend upon consideration of outside income available in each case. It would therefore not be reasonable to construe the will as overlooking the possibility that income might accrue and be undistributed in any given year, since testator provided for a common fund of income and principal, and directed that the specified payments should vary from year to year, depending on external factors of income and standard of living peculiar to each beneficiary, and discretionary judgments of the Trustees. Since these flexible amounts were to be paid from income and principal of Trust “B,” as a common fund, the reasonable construction is that excess earnings, if they occurred, were to be conserved as part of that trust fund for use in future years if and when needed.

The legal effect of such a common fund was also considered in the Yearly Meeting case and is applicable here:

“Where a testator establishes a fund, the income from which is to be used for certain purposes, but that income is in excess of the amount required for those purposes, the question whether the excess shall accumulate and be added to the principal or shall be otherwise disposed of depends primarily upon the intent of the testator.” [Citation.] . . . however, even though the will contains no expression of an intent that the excess income shall be accumulated, such course must be followed where the disposition of the excess as it accrues would be contrary to the scheme of the testator as disclosed in the will. Accordingly, the absence of an accumulation 'provision is only one of several indications of the testator’s intention and in view of the character and contents of the will, may be one by no means as significant as those of a contrary import. [Citation.] In short, a will may be effective to require the accumulation of excess income either by reason of its express terms or by implication from its general scheme of disposition.” [Citation.] [81 A2d at 106-107.] (Emphasis supplied.)

Plaintiff, however, argues that in Illinois there must be an express direction to accumulate income in order to satisfy the “Income and Principal Act” (Ill Rev Stats 1963, c 30, § 161(3)) which requires direction “by the terms of the transaction by which the principal was established,” as a condition to the accumulation of income. Nevertheless, such a direction may be found to exist in a will irrespective of the absence of an isolated, specific phrase. We emphasize that we have no intention of supplying a provision that the testator may have overlooked, or that we feel he may have wanted. Instead, we find an express, though not specific, direction to accumulate from the language of the will which created the trusts and which controls the manner of distribution.

Further, in section II, Paragraph 3, the testator provided that: “My said Trustees shall have power to hold or to retain any property coming into their possession . . . In Halderman v. Halderman, 342 Ill 550, 555-556, 11 NE 526, the court considered the question of whether after-acquired property should pass intestate or under a will which gave “my entire real and personal property wherever found,” then listed the real estate owned at the time the will was executed. Even though the testator conveyed away some of the described realty and subsequently acquired other real estate not described in the will, the court found no intestacy. Noting that both statute and decisional law required that “an intention of the testator to dispose of after-acquired property must affirmatively appear from the will,” the court then reasoned :

“The word ‘affirmatively,’ . . . means merely that the will must show an intention on the part of the testator that such after-acquired property as well as his other property shall pass by the will. This rule is satisfied by the intention appearing from the language used that all property owned by him at the time of his death shall pass by the will, and it is not necessary to use different language showing a specific intention .... The intention must be gathered from the language of the entire will and considered as a whole.”

Just as “affirmatively” may be found from the language of the entire will, so may a specific direction to accumulate income be expressed by the general scheme and language of the will.

Our conclusion finds further support in the familiar presumption against a partial intestacy, as stated in Caracci v. Lillard, 7 Ill2d 382, 386, 130 NE2d 514:

“Thus it is presumed the testatrix intended to dispose of her entire estate unless it clearly appears otherwise by the provisions of the will; and any reasonable construction, consistent with the terms of the instruments will be adopted so as to find a disposition of the entire estate rather than an intention to die testate as to one portion of her property and intestate as to another .... The intention of the testatrix must be sought in the general tenor of the instrument; and the scheme of disposition so disclosed must control, even though it involves the rejection of words in the will which are irreconcilable or inconsistent with the general context.”

See also First Nat. Bank of Chicago v. Piaget, 2 Ill App2d 207, 222, 119 NE2d 457; Wise v. First Nat. Bank of Greenville, 10 Ill2d 623, 627-628, 141 NE2d 1; Schroeder v. Benz, 9 Ill2d 589, 595, 138 NE2d 496; Halderman v. Halderman, 342 Ill 550, 11 NE 526.

Therefore, the presumption against partial intestacy, and the intended general scheme of distribution as found in express language of the will, are sufficient to support a finding that accumulation of income was authorized and that there was no intestacy as to undistributed income.

Even were we to accept, arguendo, the proposition that no implication of a direction to accumulate income may properly control in Illinois, whether or not based on express language, the presence of a residuary clause and a named beneficiary thereof raises a further presumption. The direction to the Trustees in Paragraph 7 (b), to “pay over to Michigan State . . . the remaining principal and income of Trust ‘B’ and the principal of Trust ‘A’ ” constituted a specific, express direction to accumulate undistributed income for the residuary beneficiary, and it is therefore presumed that the testator intended that beneficiary to take, rather than unspecified intestate beneficiaries. Schroeder v. Benz, 9 Ill2d 589, 593, 138 NE2d 496; Cahill v. Michael, 381 Ill 396, 405, 45 NE2d 657; Strauss v. Strauss, 363 Ill 442, 449, 2 NE2d 699.

Plaintiff has cited many authorities which we feel are distinguishable as not directly applicable to the legal or construction problems of this particular will. Our situation in being called upon to construe a will was discussed in First Nat. Bank of Chicago v. Piaget, 2 Ill App 2d 207, 216-217, 119 NE2d 457:

“We have not undertaken to distinguish the other cases cited by the . . . defendants. We have examined them and do not think they support their position. Comfort can always be found in the general language used by courts in the multitude of opinions written in will cases. Cases involving the construction of wills do not have the controlling force of precedent as in other cases. Cahill v. Michael, 381 Ill 395, 45 NE2d 657; Sloan v. Beatty, 1 Ill2d 581, 590, 116 NE2d 375. It is recognized that wills are found in a great variety of forms and are executed under circumstances peculiar to each individual case. Walker v. Walker, 283 Ill 11, 118 NE 1014; Smith v. Garber, 286 Ill 67, 121 NE 173.”

See also Halderman v. Halderman, 342 Ill 550, 556, 11 NE 526; and Glaser v. Chicago Title & Trust Co., 393 Ill 447, 456, 66 NE2d 410.

The judgment of the Circuit Court is affirmed.

Affirmed.

DRUCKER and MCCORMICK, JJ., concur.

       Michigan State University is also a party to this appeal as a respondent-appellee seeking affirmance of the judgment.

       Hampton v. Dill, 354 Ill 415, 188 NE 419; Glaser v. Chicago Title & Trust Co., 393 Ill 447, 66 NE2d 410; LaSalle Nat. Bank v. MacDonald, 2 Ill2d 581, 119 NE2d 266; Whitmore v. Starks, 17 Ill 2d 202, 161 NE2d 254; Hart v. Hart, 316 Ill App 89, 43 NE2d 853.

       Halderman v. Halderman, 342 Ill 560, 556, 11 NE 526; Strauss v. Strauss, 363 Ill 442, 447, 448, 2 NE2d 699; Scott v. Crumbaugh, 383 Ill 144, 147, 48 NE2d 532; Golstein v. Handley, 390 Ill 118, 121, 60 NE2d 851; Hayden v. McNamee, 392 Ill 99, 105, 63 NE2d 876.


author: MR. PRESIDING JUSTICE LYONS

text:
    Thomas Garrison, Plaintiff-Appellant, v. Community Consolidated School District No. 65 and Board of Education, Community Consolidated School District No. 65, Defendants-Appellees.
    Gen. No. 51,233.
    First District, Second Division.
    September 29, 1967.

      Leibman, Williams, Bennett, Baird and Minow, and Louis G. Davidson, of Chicago (Julian B. Wilheim, of counsel), for appellant.
    John C. Tucker, of Chicago (Raymond, Mayer, Jenner & Block, of Chicago, and Shanesy, Hobbs, Ball & Koch, of Evanston, of counsel), for appellees.
   MR. PRESIDING JUSTICE LYONS

delivered the opinion of the court.

This is an appeal taken by the plaintiff, Thomas Garrison, from the entry of a final judgment by the Circuit Court of Cook County on December 7, 1965, after hearing on motions, which judgment dismissed Count III of plaintiff’s complaint, in an action for personal injuries, as it pertained to the defendants-appellees, Community Consolidated School District No. 65 and Board of Education, Community Consolidated School District No. 65 (both hereinafter sometimes referred to as the instant defendants).

Plaintiff, a then twenty-year-old drama student at Northwestern University’s Evanston campus, commenced this action seeking to recover damages from the instant defendants (as well as seven other defendants not parties to this appeal) for certain alleged personal injuries sustained by him on November 22, 1958, as a result of the ignition and explosion of a “prop cannon” as he participated in a dramatic production at the Haven Community Consolidated School in Evanston. His complaint therein alleged that there existed a contractual agreement between Northwestern University and the instant defendants which provided for and controlled the use of the drama facilities at the aforementioned situs of the injury.

As concerns Count III of the complaint, plaintiff prayed for judgment against the instant defendants and others, jointly and severally, in the sum of $474,000 together with interest and costs.

The instant defendants were named as parties defendant in Count III of the complaint only, and this appeal has been taken by plaintiff solely in respect to the propriety of the trial court’s action in dismissing said Count III as against these two defendants.

In response to the complaint at bar, the instant defendants originally brought a motion to dismiss pursuant to section 48(1) (c) of the Civil Practice Act claiming there was another action pending between the same parties for the same cause. This motion was filed on August 4, 1960, 23 days after the filing of the instant complaint, at which time there existed, in fact, a prior cause pending in the Circuit Court which had, as yet, not been reduced to judgment. Upon a subsequent hearing, further proceedings on the motion were continued generally by the trial judge. Thereafter, on May 14, 1965, the instant defendants renewed their objection by filing a motion to dismiss together with supporting affidavit pursuant to section 48(1) (d) of the Practice Act (action barred by a prior adjudication) after the prior cause had been determined in their favor, affirmed by the Appellate Court, and Leave To Appeal as well as Petition for Stay of Mandate were denied by our Supreme Court. Such motion had, in addition, requested that plaintiff’s affidavit in opposition to their motion to dismiss be stricken accordingly.

The court below, relative to this latter motion, found (1) that plaintiff’s action against the instant defendants was barred by the prior adjudication in Garrison v. Community Consol. School Dist. No. 65, Circuit Court 59C 16254, affirmed, 84 Ill App2d 822, 181 NE2d 360 (1962), Leave To Appeal denied (hereinafter referred to as Case #1), and (2) that the affidavit in opposition to the motion to dismiss failed to raise any relevant issues of fact. The court entered its judgment accordingly on December 7, 1965. The complaint in the case at bar (hereinafter referred to as Case #2) had been filed in the interim on July 12,1960.

Plaintiff assigns alternative theories to this court to support his contention that the court below erred in dismissing Count III of the complaint as to the instant defendants. The judgment of December 7, 1965, from which he has taken this appeal, however, was predicated solely upon the issue of res judicata and hence is the only issue properly before this court for determination. Keeran v. The Wahl Co., 320 Ill App 457, 51 NE2d 598 (1943).

Relative to the single issue of res judicata, it is plaintiff’s theory of the case (1) that defendants’ motion to dismiss was untimely; (2) that the order of dismissal in Case #1, which is relied upon as the bar of a prior judgment, was a dismissal without prejudice, hence by appealing that adverse judgment plaintiff did not make an election to stand on his first complaint; (3) that the doctrine of res judicata has no application where, as here, the prior judgment pleaded in bar was not an adjudication on the merits thereof; and (4) that, in any event, Count III of each of the two respective complaints do not assert the same cause of action against the instant defendants.

It is the instant defendants’ theory of the case (1) that their motion to dismiss was timely under the circumstances ; (2) that plaintiff, by appealing in Case #1, made an election to stand or fall on his first complaint; (3) that the prior adjudication was a final and binding determination on the merits of the cause thereby operating in bar to this subsequent action; and (4) that the respective Counts III of the two complaints are based upon the same cause of action against the instant defendants.

Plaintiff, in his briefs and argument, has alluded to numerous events which he has shown to have intervened from the date on which the injury was sustained and which he maintains preclude the interposition of defendants’ plea of res judicata. A brief chronology of those events so offered appears as follows:

(1) November 22, 1958: plaintiff’s injury sustained.
(2) May 22, 1959: the Illinois Supreme Court in Molitor v. Kaneland Community Unit Dist. No. 302, 18 Ill2d 11, 163 NE2d 89, abolished both retroactively and prospectively the doctrine of sovereign immunity of public school districts from tort liability.
(3) July 22, 1959: the School Tort Liability Act became law in Illinois (Ill Rev Stat (1959) c 122, par 821 et seq.) which enactment adopted the decision in the Molitor case but limited public school districts’ liability to $10,000 in damages “if there is liability imposed by any court.”
(4) November 12, 1959: plaintiff’s complaint in Case #1 filed based upon the previously described tort.
(5) December 16, 1959: the Illinois Supreme Court, on rehearing in Molitor v. Kaneland Community Unit Dist. No. 302, 18 Ill2d 11, 163 NE2d 89 (1959), reiterated its former abolition of sovereign immunity of public school districts, but thereafter modified its previous opinion stating that such abolition was to operate prospectively only from and after December 16, 1959, with the sole exception of Thomas Molitor’s case.
(6) February 15, 1960: the instant defendants filed a motion to dismiss plaintiff’s complaint in Case #1 for its failure to state a claim upon which relief could be granted, the theory of such motion being that the action predated the effective date of the Supreme Court’s abolition of school districts’ sovereign immunity in the Molitor case.
(7) July 12, 1960: plaintiff’s complaint in the instant case filed.
(8) August 4, 1960: the instant defendants filed their original motion to dismiss Case #2 predicated upon the then pendency of the cause in Case #1.
(9) January 31, 1961: the Circuit Court in Case #1 entered its final order dismissing the cause in Count III of the complaint as to the instant defendants thereby severing them from that action.
(10) February 2, 1961: upon a hearing, the instant defendants’ motion to dismiss in Case #2 was continued generally to be brought up by either party on twenty days’ notice.
(11) January 30, 1962: the Circuit Court’s order of dismissal in Case #1 was affirmed by this division of the Appellate Court, the theory of that decision being that the plaintiff had failed to plead the existence of non-trust funds so as to overcome the pre-Molitor doctrine of sovereign immunity of public school districts, and that such law as it then existed was not circumscribed by the provisions of the School Tort Liability Act.
(12) May 24, 1962: plaintiff’s Petition for Leave to Appeal the Appellate Court’s decision in Case #1 was denied by the Illinois Supreme Court.
(13) May 14, 1965: the instant defendants filed a motion to dismiss, together with supporting affidavit, in Case #2 based upon the prior adjudication in Case #1.
(14) July 27, 1965: plaintiff filed in the Illinois Supreme Court a Petition for Stay of Mandate and Other Relief in Case #1.
(15) July 30, 1965: plaintiff filed an affidavit in opposition to defendants’ motion to dismiss in the case at bar, and the instant defendants filed a motion to strike said affidavit in opposition to their motion.
(16) August 6, 1965: plaintiff’s Petition for Stay of Mandate in Case #1 denied by the Supreme Court.
(17) September 21 and December 1, 1965: hearings had on the motion to dismiss of May 14,1965.
(18) December 7, 1965: the Circuit Court entered its judgment dismissing Count III of the complaint in Case #2 as to the instant defendants, and from which judgment plaintiff has taken this appeal.
(19) December 10, 1965: plaintiff filed a motion in the Supreme Court for reconsideration of its previous order dismissing his appeal as to that court’s denial of his Petition for Stay of Mandate in Case #1.
(20) January 18,1966: the Supreme Court denied plaintiff’s motion for reconsideration of his December 10,1965 motion.

From these purportedly relevant and intervening circumstances, initial consideration must be given plaintiff’s objection in regard to the timeliness of the May 14, 1965 motion to dismiss, such motion representing the subject matter of this appeal. We cannot, however, upon our examination of the record before us, find foundation in fact or law to support plaintiff’s contention on the point.

There is no dispute but that defendants’ original motion to dismiss under section 48 (1) (c) of the Practice Act was filed within the time prescribed for answer. Subsequently, at the hearing on that motion on February 2, 1961, all further proceedings in the instant cause were continued generally by the hearing judge. It is manifest from the Report of Proceedings at that hearing that the purpose in so doing was to hold the present action in abeyance pending a final determination of the related issues in the first case. It might be noted, parenthetically, that it was plaintiff, not defendants, who had requested the stay, plaintiff having suffered the adverse ruling by the Circuit Court in Case #1 two days earlier and advising the court of his intention to appeal. It should have become apparent to plaintiff, in view of the stay of proceedings in the case at bar, that a new motion would be eventually forthcoming based upon the adjudication rather than the pendency of the prior action.

Plaintiff suggests that after the Supreme Court denied his Leave To Appeal on May 24, 1962 in Case #1, it became incumbent upon the instant defendants to make timely application to the lower court by interjecting their motion based upon res judicata. We cannot agree. By plaintiff’s own construction of the facts in the premises, it stands unrefuted that relief was being sought by him in Case #1 as late as December 10, 1965, three days subsequent to the date on which the judgment in Case #2 was entered and from which he has brought this appeal. The subject motion of May 14, 1965 was filed by leave of court. To say that that motion was untimely and that the court abused its discretion in granting leave to file it, would be to ignore the order of continuance of February 2, 1961, and to grossly misconstrue the attendant circumstances which occasioned the delay. It would moreover appear, contrary to plaintiff’s contentions, that plaintiff at no point in the proceedings below addressed an objection to the timeliness of the motion. Under well settled standards of review, the objection has thus been waived. Wylie Equipment Co. v. Alters, 26 Ill App2d 118, 167 NE2d 828 (1960), 2 ILP (Appeal and Error) § 242.

Plaintiff, relative to this same motion, claims to have not been afforded the prescribed 20 days’ notice of motion as per the order of February 2,1961. While it does appear plaintiff had received but two days’ notice of the motion and had raised such an objection before the hearing judge, it is equally apparent that the irregularity was cured at the hearing of May 14, 1965 on the motion of even date. In response to the objection, the hearing judge stated:

“I will enter an order giving you leave to file your motion, . . . how long do you want? . . . What I contemplate doing is giving you time, whatever time you wish, to file counterpapers, whether they be affidavits or anything else, . . . .”

The court thereafter entered an order accordingly, plaintiff being allowed to file an affidavit in opposition to the motion to dismiss approximately six weeks later.

Plaintiff next argues that the general order of dismissal by the Circuit Court in Case #1, from which he had appealed, was a dismissal without prejudice to his right to bring the same action anew. Plaintiff submits that all dismissals of actions at law are without prejudice, purporting to support that contention by pointing to the absence of any language in the order which would import a contrary conclusion. An examination of the authorities cited by plaintiff, however, reveals the orders of dismissals in each case to have been entered absent a contest on the issues raised by the pleadings. Manifestly, such is not the situation in the case at bar.

The instant defendants’ motion to dismiss in Case #1 admitted all of the facts well pleaded in the original complaint together with the inferences which might have legitimately flown therefrom. Garrison v. Community Consol. School Dist., supra. Accordingly, we cannot conclude, as plaintiff suggests, that the cause in Case #1 was disposed of summarily as a matter of law without resort to the factual considerations necessarily created by the motion.

Where, as in Case #1, the prior judgment amounts to a final determination of the respective rights and liabilities of the parties based upon the ultimate state of facts as disclosed by a demurrer to the complaint, and upon which complaint the right of recovery was dependent, the prior judgment was one rendered on the merits of that case thereby operating in bar to the subsequent action. Lytton v. Cole, 54 Ill App2d 161, 203 NE2d 590 (1964); Howard T. Fisher & Associates v. Shinner Realty Co., 24 Ill App2d 216, 164 NE2d 266 (1960). It is immaterial whether the facts upon which the trial court based its determination were proven by evidence or admitted by motion to dismiss, Pratt v. Baker, 79 Ill App2d 479, 223 NE2d 865 (1967), and the rule is conclusive on the issues so presented irrespective of whether the subsequent suit purports to involve an entirely different cause of action. Lytton v. Cole, supra; Howard T. Fisher & Associates v. Shinner Realty Co., supra.

At no time in either proceeding has plaintiff denied that the complained of injury predated the effective date of our Supreme Court’s prospective abolition of sovereign immunity of public school districts from tort liability. Similarly, there is no dispute about the proposition that the same parties and one and the same injury are involved in the two cases.

The gravamen in a plea of res judicata is identity of parties and issues. Plaintiff’s complaint in Case #1 failed to aver facts upon which such liability could have been predicated under the then applicable law on the subject, judgment was entered upon the state of facts so disclosed by the pleadings, and plaintiff, rather than seeking leave to amend so as to include the fatally absent allegation of existing nongovernmental funds with which to satisfy a judgment, elected to stand on his complaint (the order of dismissal in Case #1 so reciting) and pursue his test of the Molitor doctrine on multifold theories of relief. See Garrison v. Community Consol. School Hist., supra.

Under circumstances parallel to those of the case at bar, the Supreme Court, in Webb v. Gilbert, 357 Ill 340, 192 NE 252 (1934) stated:

“If the complainant omitted anything in her first suit by way of relief sought she cannot take advantage of the omission in the present suit. . . . When there has been a final judgment or decree neither party thereto should again be permitted to relitigate by undertaking to change his position in the case and to force his adversary again to defend against the same matters and matters collateral thereto as were properly involved or might have been brought forth in the prior litigation, . . . .”

Plaintiff’s attempt to relitigate issues previously disposed of on the merits thereof or issues which should have been presented is thus barred by the doctrine of res judicata. Elston-Damen Currency Exchange, Inc. v. Sheon, 46 Ill App2d 218, 197 NE2d 143 (1964).

The aforesaid rule obtains notwithstanding the absence of language in the final order (upon which judgment was rendered) subsequently pleaded in bar indicating whether such judgment was entered with or without prejudice. Branom v. Miller, 25 Ill App2d 94, 166 NE2d 123 (1960). The fact that the instant complaint was filed prior to any final determination on the merits of Case #1, is, moreover, devoid of legal consequence as the relevant consideration in a plea of res judicata is the existence of the prior judgment as of the point in time when the plea is interjected. Black v. Thomson, 120 Ill App 424 (1905).

The law affords every man his day in court with the opportunity to present his case, but it likewise requires that he bring forth all grounds of recovery which he may then have. The rule is rooted in long established public policy considerations. Pratt v. Baker, supra. The plaintiff here has had his day in court and cannot be heard to offer a second complaint which remains substantially unchanged from its predecessor, save his allegation on information and belief, relative to the existence of nongovernmental funds with which a judgment could be satisfied.

Plaintiff next urges that the court below erred in denying his motion to strike the affidavit filed by the instant defendants in support of their motion to dismiss. It is plaintiff’s contention that the alleged defect not appearing on the face of the complaint attacked, under the language of section 48(1) and (6) of the Practice Act, the governing provisions of Supreme Court Kule 15(1) have not been complied with in the affidavit. We disagree. The subject motion to dismiss had attached thereto as certified exhibits and incorporated by reference (1) the complaint in Case #1, (2) the instant defendants’ motion to dismiss as addressed to that complaint, and (3) both the order of dismissal of the Circuit Court as well as the affirming opinion of this Appellate Court in Case #1.

The affidavit to which plaintiff directed his attack manifest the personal knowledge of the affiant (counsel for defendants in both Cases #1 and #2), attested to the authenticity of the Appellate Court opinion, and similarly incorporated by reference, as grounds for dismissal, the aforesaid exhibits attached to the motion in chief. The tendered court exhibits speak for themselves and we think it would have been a meaningless ceremony to have required that the affiant recite in haec verba the exhibits attached to the motion and to which he made specific reference. We furthermore feel defendants’ offer of those extrinsic documents sufficed to sustain their burden of proof on the issue of res judicata. Setliff v. Reinbold, 73 Ill App2d 208, 218 NE2d 814 (1966).

Lastly, plaintiff asserts that the court similarly committed error in striking the affidavit filed in his behalf in opposition to the defendants’ motion to dismiss. The contention is ill founded, and we concur in the conclusion reached by the trial judge. Without belaboring the point, suffice to say that that affidavit simply narrated in essence the statement of facts as they appear in this opinion and endeavored to oppose the motion to dismiss on the legal theories already resolved in the instant defendants’ favor. The affidavit was properly stricken.

For the above reasons, the judgment is affirmed.

Judgment affirmed.

BURKE and BRYANT, JJ., concur.

       As of the date of the rendition of this opinion, plaintiff’s actions in both Case #1 and Case #2 are still pending in the Circuit Court of Cook County against the balance of the original codefendants, Northwestern University, Rita Criste, David Press, Herman Zimmerman, C. F. Newman Co., Inc., and Joe Rozzi and Paul Rozzi, d/b/a Newco Products.


author: MR. JUSTICE DRUCKER

text:
    Carmen Senese, Plaintiff-Appellee, v. Civil Service Commission of the City of Chicago, and Milton Pikarsky, Commissioner of Public Works of the City of Chicago, Defendants-Appellants.
    Gen. No. 50,831.
    First District, Fourth Division.
    October 2, 1967.
    Rehearing denied October 30,1967.
    Raymond F. Simon, Corporation Counsel, of Chicago (Sydney R. Drebin, Assistant Corporation Counsel, and Harry H. Pollack, Special Assistant Corporation Counsel, of counsel), for appellants.
    Michael F. Ryan, of Chicago (Richard F. McPartlin, of counsel), for appellee.
   MR. JUSTICE DRUCKER

delivered the opinion of the court.

Defendants appeal from a judgment reversing a finding and decision of the Civil Service Commission of Chicago that plaintiff be removed from his position as a tree trimmer in the Bureau of Forestry of the Department of Public Works of the City of Chicago.

On July 31, 1964, charges were filed against the plaintiff that from the fall of 1960 to July 1, 1964, plaintiff, while an employee of the Bureau as a civil service tree trimmer, was a partner in the firm of Hillside Florist; that Hillside Florist, during said period of time, conducted a florist business for profit, including flower sales to the City, which sales were made through the Bureau.

Thomas S. Mclnerney, a commissioner of the City’s Department of Investigation, testified that on July 6, 1964, he questioned plaintiff, and that plaintiff gave him the following information: That he (Senese) organized Hillside Florist; that he was one of the persons who applied for the original florist license with his wife and sister Rose. Although his position was tree trimmer, he had performed as an inspector and as such he answered complaints and made inspections after storms. He also participated in special events involving visiting dignitaries where flowers were bought for the occasion by the City; that he was not in full control of selecting and buying said flowers but participated therein; that after a decision was made therein, he would place the order for said flowers with Hillside Florist; and that such procedure had been going on since about 1961. He also helped with the arrangement of flowers and sometimes, because the arrangement did not look good or flowers looked damaged, he would get more flowers.

A statement of plaintiff was introduced into evidence as Exhibit 1. It contained in pertinent part the following additional information: That when he helped in deciding what flowers would be needed for various City functions, after he and the other two men in the Bureau of Forestry who helped in such decision made their decision, the three of them would go to a wholesaler and select the flowers; that they always selected 1A flowers; that the flowers they ordered were delivered to Hillside Florist at 6841 South Ashland; that Hillside would arrange the flowers, furnish the necessary equipment, and deliver the flowers in its truck to the function in question; that Senese organized Hillside Florist about 1948 with his sister Rose and Anthony Calzaretta; that when he went to work for the City in 1952 he quit active operation and management of Hillside Florist; that since said time he and his wife have shared one-third in Hillside’s profits; that his wife draws $110 a week from Hillside; that for 1968 his income tax return shows that he and his wife earned a profit of $8,902.18 from Hillside Florist.

On cross-examination, Commissioner Mclnerney stated that “Senese, solely, bought the flowers although he did not have full power to select them,” and that the City’s purchases from Hillside Florist were not on competitive bidding.

Plaintiff’s direct testimony generally followed the written statement. On cross-examination he stated that in 1955 he made application to the City Collector for a license as a retail florist, and that a license was issued in his name and that of his sister Rose. He further testified that the City always purchased the special flowers from Hillside Florist; that such business amounted to $20,000 over a period of four or five years; that he went to the wholesalers to pick out the flowers and directed the wholesaler to send the flowers to Hillside Florist; that he derived an income from Hillside Florist; and that there was always a yearly profit from Hillside.

The Cities Civil Service Act became effective in the City on July 1, 1895. People v. Kipley, 171 Ill 44, 47, 49 NE 229. Then, and now under section 10-1-18, Illinois Municipal Code (Ill Kev Stats 1965, c 24, § 10-1-18), the Commission has had the power to remove a civil service employee for “cause.” Since said act has never defined “cause,” the Commission has always had the jurisdiction to determine “cause.” Kammann v. City of Chicago, 222 Ill 63, 65, 78 NE 16.

Cause justifying the removal of a civil service employee means “some substantial shortcoming which renders continuance in his office or employment in some way detrimental to the discipline and efficiency of the service and something which the law and a sound public opinion recognize as a good cause for his no longer occupying the place.” Murphy v. Houston, 250 Ill App 385, 394.

Defendants argue that public policy dictates that when an employee of the City acts as an agent of the City in dealing with a company in which he has a financial interest, a conflict of interest arises, and that such conflict of interest is detrimental to discipline and efficiency, citing Murphy v. Houston, 250 Ill App 385, 394.

In discussing the meaning of “public policy,” the Supreme Court of Florida, in City of Leesburg v. Ware, 113 Fla 760, 153 So 87, 89, stated:

A correct definition, at once concise and comprehensive, of the words “public policy,” has not yet been formulated by our courts. Indeed, the term is as difficult to define with accuracy as the word “fraud” or the term “public welfare.” In substance, it may be said to be the community common sense and common conscience, extended and applied throughout the state to matters of public morals, public health, public safety, public welfare, and the like. It is that general and well-settled public opinion relating to man’s plain, palpable duty to his fellow men, having due regard to all the circumstances of each particular relation and situation.

In the same case, the court also stated at page 90:

It may be safely stated, as a sound or accurate standard by which to determine the applicability of the rule, that no phase of private relations shall be contrary to public policy; that when a contract contravenes an established interest of society it is void as against public policy, and for one person to undertake to be the agent for two persons trading at arm’s length with one another contravenes an established interest of society.

This language was cited in the recent case of City of Coral Gables v. Weksler (Fla), 164 So2d 260, 262 (1964), in which a city employee also had a lease with the City and the question of conflict of interest arose. The court stated at page 263:

The conflict of interest theory is based, as we understand it, on the fact that an individual occupying a public position uses the trust imposed in him and the position he occupies to further his own personal gain.

In the instant case, the city employee’s related duties as a tree trimmer included the selection of flowers for special occasions. He stated that he “went to the wholesalers to pick out the flowers and directed the wholesaler to send the flowers to Hillside Florist” (in which he had a financial interest). There is evidence that plaintiff “solely” placed the orders. He therefore acted in a dual capacity — purchasing on behalf of the City and selling to the City at a profit for himself.

The Civil Service Commission ordered plaintiff removed from his position for cause. “On administrative review the court does not weigh the evidence and its function is limited to ascertaining if the findings and decision of the administrative agency are against the manifest weight of the evidence.” DeGrazio v. Civil Service Commission of Chicago, 31 Ill2d 482, 489, 202 NE2d 522. The order of the Commission was not against the weight of the evidence, and the court erred in setting it aside.

Plaintiff also claims that his motion to quash the charges was never ruled on by the Commission. In his complaint, however, he states that “plaintiff filed a motion with [the] Commission to quash charges, which motion was denied.” Nevertheless, we find that the charges were sufficient to apprise him of the nature of the matters alleged against him. Murphy v. Houston, 250 Ill App 385.

The judgment of the Circuit Court is reversed and the findings and decision of the Civil Service Commission are affirmed.

Reversed.

ENGLISH, P. J. and McCORMICK, J., concur.


author: MR. JUSTICE DRUCKER McCORMICK, J.,

text:
    Carmen Senese and Louis Senese, d/b/a Ogden Cartage Company, Plaintiffs-Appellants, v. City of Chicago, a Municipal Corporation, and John F. Ward, Purchasing Agent, Defendants-Appellees.
    Gen. No. 50,828.
    First District, Fourth Division.
    October 2, 1967.
    Halfpenny, Hahn & Ryan, of Chicago (Harold T. Halfpenny, James F. Flanagan, Thomas F. Roche, and Mary M. Shaw, of counsel), for appellants.
    Raymond F. Simon, Corporation Counsel, of Chicago (Sydney R. Drebin and John P. Collins, Assistant Corporation Counsel, and Harry H. Pollack, Special Assistant Corporation Counsel, of counsel), for appellees.
   MR. JUSTICE DRUCKER

delivered the opinion of the court.

Plaintiffs appeal from a dismissal of their amended complaint.

According to the amended complaint, plaintiffs were in the cartage business under the name of Ogden Cartage Company. One of the plaintiffs, Carmen Senese, was employed by the City of Chicago as a tree trimmer. The City invited bids, as set out in Exhibit A, for the hire of truck services; on April 22, 1964, the plaintiffs submitted sealed, written proposals (the form of which was set out in Exhibit A) which were accepted by the defendants; pursuant to the terms and conditions of these proposals a priority of call was established by defendants, and plaintiffs were assigned priority numbers for three different types of truck services. Plaintiffs performed until July 8, 1964, when they were informed that because of a conflict of interest on the part of Carmen Senese, one of the plaintiffs and an employee of the City of Chicago, the City would no longer do business with plaintiffs. The prayer of the amended complaint was for a declaration that no conflict of interest exists and that the court declare the right of the plaintiffs to submit proposals, be assigned a priority on the basis of said proposal, and to be called from said priority list.

Since Exhibit A was not attached to the amended complaint defendants could have moved for a dismissal under section 45 of the Civil Practice Act for failure to set out the written instrument sued on. Instead, defendants moved to dismiss on the same grounds stated in their motion to dismiss the original complaint. (The amended complaint was a restatement and exact reiteration of the original complaint except that in Count II an allegation of fraud was added.) The motion stated in pertinent part:

1. That the theory of the complaint is founded on a contract by which on the face of the complaint fails to state a competent covenant for the following reasons:
(a) That it is patent on the face of the complaint and exhibit attached thereto that there was no offer and acceptance under the rule of law encompassing bids. (Emphasis supplied.)
(b) That it is patent on the face of the complaint there is no consideration.
(c) That it is patent on the face of the complaint that the plaintiff never circumscribed any of his future actions.
(d) That the complaint failed to allege any specific work to be performed.

On appeal one of defendants’ theories of the case is that plaintiffs’ amended complaint fails to state a cause of action because it is in violation of section 36 of the Civil Practice Act in that it does not set forth the written instruments upon which plaintiffs’ claim is founded.

In Clegg v. Gould, 314 Ill App 670, 42 NE2d 315, the court held that a contention that plaintiff failed to attach to his complaint a copy of the written contract upon which the action was based, not having been raised in the trial court, cannot be urged on appeal.

Under section 45(2) of the Civil Practice Act the motion to dismiss “must specify wherein the pleading . . . is insufficient.” In Admiral Oasis Hotel v. Home Gas Industries, 68 Ill App2d 297, 216 NE2d 282, the court stated on page 304:

Several decisions have held that a motion to dismiss cannot be allowed where specific grounds are not set forth. Hitchcock v. Reynolds, 278 Ill App 559 (1935); Central Illinois Electric & Gas Co. v. Scully, 17 Ill2d 348, 161 NE2d 304 (1959). An obvious companion to such a rule is that grounds not specified in the motion to dismiss cannot be urged on appeal.

In the instant case defendants failed to specify in their motion to dismiss that the written instrument sued on was not attached to or recited in the amended complaint and therefore the point cannot be considered on review.

Defendants next contend, according to their theory of the case in our court, that the contract alleged in said amended complaint is void for want of mutuality, and that the period of the duration of said alleged contract is indefinite and said contract was therefore terminable at the will of either of the parties, and was in fact terminated by defendant City of Chicago, hereinafter referred to as City, and cannot be the basis of a cause of action. Once again we must point out that neither of these objections was raised in the trial court and cannot be urged for the first time on review.

Although it seems that defendants have abandoned the grounds set forth in their motion to dismiss in the trial court, we have examined the complaint to ascertain if it should have been dismissed. It recites that a contract was entered into (which has never been denied by defendants), that plaintiffs performed under that contract and that the contract was terminated by the defendants for the stated reason of a conflict of interest. It sought a declaration that no conflict of interest exists and that plaintiffs be reinstated on the priority list.

In Kita v. Young Men’s Christian Ass’n of Metropolitan Chicago, 47 Ill App2d 409, 418, 198 NE2d 174, Justice McCormick in a learned dissertation on pleading quoted from Clark on Code Pleading (2nd Ed 1947), pages 56-57. It bears repetition :

It is perhaps doubtful if we are now prepared to go to the complete lengths of brevity urged by the proponents of notice pleading, except in isolated cases. But without so doing we may properly put the emphasis where they do. This, it seems, is in effect the modern tendency. The aim of pleadings should be therefore to give reasonable notice of the pleader’s case to the opponent and to the court. This does not go as far as the technical notice pleading, since it requires notice of the pleader’s entire cause, not merely that he has a claim. The notice to the court is perhaps the more important, for in general the opponent knows enough about the case to relieve us of worry about him. In fact we have spent altogether too much thought over the danger of surprising a defendant. If his case is prepared at all adequately he will not be surprised. Our solicitude for him will simply result in giving him opportunities to delay the case and harass his opponent. The main purpose of the pleadings should therefore be to give the trial court a proper understanding of the case. If the trial court is adequately informed of the issue by the pleadings, it means that the parties are likewise so informed. It is for the court, not the litigants, to vindicate pleading rules.

We find that the amended complaint, without Exhibit A (the form of Invitation To Bid and Proposal and Truck Hire Agreement) stated a cause of action and that the trial court erred in dismissing the complaint. The judgment is reversed and the cause remanded for further proceedings not inconsistent with this opinion.

Reversed and remanded.

ENGLISH, P. J., concurs.

McCORMICK, J.,

dissenting:

I must respectfully dissent from the majority opinion. In the first count of the complaint the plaintiffs state that both parties are bound by the provisions of the defendants’ invitation for bids and the plaintiffs’ acceptance of the proposal as indicated in Exhibit A; that the defendants, subsequent to April 22, 1964, did answer plaintiffs’ proposal and did establish a priority of call as provided for in the invitation and proposal, and assigned the plaintiffs priority numbers for certain classes of trucks. It is further alleged that the plaintiffs

“held themselves out as being ready, willing and able to perform the undertakings required by them to be performed, and did perform . . . ; the defendants have refused and continue to refuse to honor the plaintiffs’ position on said priority lists, and have called and continue to call those bidders having higher priority numbers assigned than the plaintiffs.”

The plaintiffs then pray for declaratory judgment under section 57.1 of the Civil Practice Act:

“(a) That the Court declare that no ‘conflict of interest’ exists . . .
“(b) That the Court declare the right of the plaintiffs to submit proposals, be assigned a priority on the basis of said proposal, and to be called from said priority list

Count II realleges the allegations contained in Count I, and in effect prays for damages for a breach of contract on the part of the defendants.

Count I is based on the Declaratory Judgment Act (SHA c 110, § 57.1, p 222). It is impossible for the writer of this dissent to understand how a declaratory judgment could be properly sought in this case. The plaintiffs could bring an action only for breach of contract. In Stern v. Material Service Corp., 44 Ill App2d 198, 194 NE2d 511, we questioned whether or not a suit for declaratory judgment was properly brought, and cited Trossman v. Trossman, 24 Ill App2d 521, 165 NE2d 368, where it was held that the action under the Declaratory Judgment statute was not designed to supplant existing remedies. Declaratory relief as a general rule will not be granted for a cause of action which has already accrued and which is justiciable in a well-recognized form of action. 16 ILP, Declaratory Judgments, § 2. In the Notes to the Declaratory Judgment Act it was pointed out that the remedy was not designed to supplant existing remedies or to afford a new choice of tribunals.

Even if the plaintiffs here had properly alleged a valid contract, and if the defendants had refused to comply with its terms, a complaint for declaratory judgment would not lie. In any case it is hard to understand why the plaintiffs should (as prayed in the complaint) be given the right to now submit proposals, be assigned a priority on the basis of such proposals, and be called from the priority list. In the majority opinion it is stated that the prayer of the amended complaint was “that the court declare the right of the plaintiffs to submit proposals, be assigned a priority on the basis of said proposal, and to be called from said priority list.” All of these questions could have been raised and passed on in a suit for breach of contract. The plaintiffs should rely on their second count, setting out a breach of a now existing contract.

In the majority opinion the view is taken that while Exhibit A was not attached to the amended complaint, the failure to so attach was not properly raised in the motion to dismiss. With that contention (which, in the opinion of the writer of this dissent, is immaterial) there is no disagreement. Assuming that Exhibit A was properly attached to the complaint, the plaintiffs are in no way helped thereby. The exhibit specifically provides that “The truck hire agreement shall consist of the following parts: Legal advertisement attached hereto, Terms and Conditions of the Invitation for Bids, proposal, and priority list posted by the Purchasing Agent.”

In the proposal it is provided that if there is a proper bid and acceptance there will be a priority of call established. That paragraph also provides the following:

“Using departments and agencies when ordering trucks through the Truck Pool shall order out trucks, when required, in the priority scale as established by the Purchasing Agent, provided that such trucks shall in the opinion of the Using Department meet the operating needs for the particular assignment in their department, bureau, division or section and provided that the Contractor is available for the time requested.”

There is no allegation in the complaint that the trucks of the plaintiffs did meet the operating needs for the particular assignment, nor is there any allegation that the plaintiffs’ trucks were available for service at the time the City passed over the priority numbers of the plaintiffs and called the trucks of firms having higher priority numbers.

In Exhibit A there is this further provision:

“All truck hire agreements shall be extensions at the option of the City, for periods as shown in the legal advertisement and may be extended for the periods as shown in the legal advertisement by written notice by the Purchasing Agent to the contractor.”

This provision, without the legal advertisement, is wholly meaningless. The legal advertisement, which was a vital part of the negotiations, does not appear in the pleadings or in the exhibit filed by the plaintiffs.

Without the advertisement, which is neither alleged in substance nor attached as a part of Exhibit A, there is nothing in the complaint to show that the contract was not terminable at will. In Stein v. Isse Koch & Co., Chicago, Inc., 350 Ill App 171, 112 NE2d 491, the court properly held that “A contract calling for continual performance and containing no provision for its duration is ordinarily terminable at will.”

Nor can it be said that the complaint can in any way be helped by Kita v. Young Men’s Christian Ass’n of Metropolitan Chicago, 47 Ill App2d 409, 198 NE2d 174. In the majority opinion it is stated that the amended complaint, without Exhibit A, stated a cause of action; with that statement I cannot agree. The majority opinion also states:

“Defendants next contend, according to their theory of the case in our court, that the contract alleged in said amended complaint is void for want of mutuality, and that the period of the duration of said alleged contract is indefinite and said contract was therefore terminable at the will of either of the parties, and was in fact terminated by defendant City of Chicago, hereinafter referred to as City, and cannot be the basis of a cause of action. Once again we must point out that neither of these objections was raised in the trial court and cannot be urged for the first time on review.”

However, the motion to dismiss states:

“1. That the theory of the complaint is founded on a contract by which on the face of the complaint fails to state a competent covenant for the following reasons:
“ (c) That it is patent on the face of the complaint that the plaintiff never circumscribed any of his future actions.
“(d) That the complaint failed to allege any specific work to be performed.”

In Kita it was said: “The main purpose of the pleadings should therefore be to give the trial court a proper understanding of the case.” In the opinion of the writer of this dissent, the motion to dismiss accomplished just that. The objection was properly raised. It is also the opinion of the writer that the trial court properly dismissed the complaint for failure to state a cause of action, and the judgment of the Circuit Court of Cook County should be affirmed.

       Exhibit A which included the form of Invitation and Proposal Truck Hire Agreement was not attached to the amended complaint although it was attached to the original complaint.

       In Morphet v. Morphet, 19 Ill App2d 304, 152 NE2d 492, a garnishment action against an insurance company, garnishee’s defense was founded on a written instrument but a copy was not attached. Plaintiff therefore contended that garnishee’s pleading had been properly stricken under Section 36. The Appellate Court said at page 308: “This contention is untenable for the garnishee’s amended answer recited the relevant terms of the contract on which the garnishee relied. This is a sufficient compliance with the statute. (Darst v. Lang, 367 Ill 119.)”


author: MR. JUSTICE BRYANT

text:
    De Luxe Motor Stages of Illinois, Inc., Plaintiff-Appellant, v. Hartford Accident & Indemnity Co., Defendant-Appellee.
    Gen. No. 50,418.
    First District, Second Division.
    October 6, 1967.
    Jay A. Baier, of Chicago (Joseph B. Lederleitner, of counsel), for appellant.
    Gihnartin & Wisner, of Chicago, for appellee.
   MR. JUSTICE BRYANT

delivered the opinion of the court.

This is an appeal from a judgment for the defendant entered December 17, 1964 by the Circuit Court of Cook County upon a finding made by the Court without jury.

De Luxe Motor Stages of Illinois, Inc., (“plaintiff” herein) is a corporation engaged in the transportation of passengers by bus. The Hartford Accident & Indemnity Co., (“defendant” herein) was an insurance carrier for the plaintiff under a Comprehensive Bodily Injury and Property Damage Liability Policy which insured plaintiff against liability for damages because of injury to a person caused by accident.

On July 26, 1950, the plaintiff accepted as a passenger Genevieve Guthrie for transportation from St. Louis to Chicago. During the trip the plaintiff’s bus made a stop at Litchfield, Illinois, at a roadside restaurant known as “Skinny’s Cafe.” Mrs. Guthrie left the bus, entered the cafe and patronized its facilities. As she prepared to exit from the cafe Mrs. Guthrie fell on the cafe’s poorly lighted and littered stairs. As a result of the fall, Mrs. Guthrie suffered serious injuries. Thereafter Mrs. Guthrie brought suit against De Luxe Motors for her injuries, medical expenses and loss of earnings.

The plaintiff notified defendant of the lawsuit and demanded that pursuant to the insurance policy the defendant undertake plaintiff’s defense against the Guthrie action. Defendant refused to defend against the Guthrie action and continued to deny requests that it participate in the case. As trial call approached the plaintiff conducted settlement negotiations with Mrs. Guthrie and ultimately settled her claim for $1,500 and obtained a release of claim from Mrs. Guthrie and her husband in December of 1955.

On January 17, 1956, the plaintiff brought this action to recover from defendant $2,275 which included the amount of the settlement paid to Mrs. Guthrie plus a demand of $775 in attorney’s fees incurred in defense and settlement of the Guthrie claim. Defendant’s answer denied liability on several grounds. The case was assigned for trial on December 15, 1964, and on that day the defendant was permitted, over plaintiff’s objections, to file an amended answer which raised an additional defense based upon the “no action” clause of the policy. The clause states:

“No action shall lie against the company unless, as a condition precedent thereto, the insured shall have fully complied with all of the terms of this policy, nor until the amount of the insured’s obligation to pay shall have been finally determined either by judgment against the insured after actual trial or by written agreement of the insured, the claimant and the company.”

At the close of the plaintiff’s case the defendant moved for a finding in its favor on the grounds (1) that under the “no action” clause an action against the defendant does not lie until the insured plaintiff’s liability is reduced to judgment which fact was not shown in the evidence; and (2) that the claim of the injured third person against the insured plaintiff was not within the coverage of the policy because “Skinny’s Cafe” was a location not covered by the policy and because an endorsement on the policy “excluded coverages for claims arising out of the ownership, maintenance or use of automobiles, owned, operated or hired by or for the insured or arising out of accidents to passengers while entering, riding in, upon alighting from automobiles.” The Circuit Court found as an uncontroverted fact that the plaintiff had settled the Guthrie suit. The court found that this was a breach of the insurance contract which relieved the defendant of liability to the plaintiff. Upon this finding the court entered judgment for the defendant. The court also found, however, that under the insurance contract the defendant should have afforded defense against the Guthrie suit but that its failure to do so was in good faith. Finally, the court found that the Guthrie settlement was reasonable in amount.

On this appeal the plaintiff alleges two errors in the proceedings below: (1) that the allowance of defendant’s amended answer which raised the “no action” clause defense on trial day, to plaintiff’s surprise and prejudice, constituted an abuse of the court’s discretion, and (2) that the defendant’s breach of contract in refusing to defend released the plaintiff from its policy obligations, so that the “no action” clause is no bar to recovery of subsequent reasonable settlement costs.

Considering first plaintiff’s second contention, we are of the opinion that it raises an issue not previously determined in Illinois law and that it is dispositive of this case. Plaintiff’s theory is based upon the following reasoning: A refusal by the insurer to extend coverage when the action is within the terms of the policy, where the insured properly performs his obligations to bring the insurer into participation in the suit, constitutes a breach of the contract by the insurer. As a result of that breach the insured party is forced to do what his insurer should have done, that is, to take appropriate defense measures in the suit. As a consequence, if the insured party finds in good faith that settlement of the case is appropriate, and thereupon concludes a reasonable settlement, a clause in the policy requiring judgment rather than settlement should not defeat the insured’s rights against his insurer.

The defendant argues that its breach of the insurance contract does not release its insured from the obligation of securing defendant’s agreement to a settlement or litigating the claim to a judgment against the insured. In support of this contention the defendant directs our attention to Piper v. State Farm Mutual Auto Ins. Co., 1 Ill App2d 1, 116 NE2d 86 (1958) and Diamond v. Massachusetts Bonding & Ins. Co., 226 F2d 396 (7th Cir Ill 1955) which it says are dispositive of this case. In the Piper case an insured brought suit against his insurer for the amount of a settlement the insured had made after the insurer denied coverage. The insurer defended upon the basis of a “no action” clause and the fact that the policy had been canceled for nonpayment of premium and the insured so notified prior to the accident resulting in the claim. The Appellate Court reversed a judgment against the insurer. The crucial fact in that case was that no effective insurance contract existed when the claim arose. Since there was no contract there could have been no wrongful breach by the insurer. The Appellate Court therefore did not consider the question of whether a breach by the insurer would excuse the insured from adherence to the “no action” clause.

In the Diamond case, as in the instant case, an insured brought suit against an insurer for the amount of a settlement of a claim against the insured. Diamond, the insured, was protected by two insurers, Massachusetts Bonding and Hawkeye Security. When suit was brought against Diamond he notified Hawkeye Security but not Massachusetts Bonding. Thereafter, the representatives of Hawkeye Security made settlement with the injured claimant and caused an agreed judgment to be entered against Diamond. In affirming the judgment for Massachusetts Bonding the Court of Appeals observed that Diamond did not comply with the provisions of the policy issued by Massachusetts Bonding in giving notice of the claim and suit against him. Nor did he ever ask Massachusetts Bonding to defend him in that suit. It is plain that there was no breach of the policy by Massachusetts Bonding and therefore there was no question of excusal of Diamond from the “no action” clause.

A note in 49 ALR2d 694 at 744 treats this problem at length:

“§ 22. Loss of right to invoke clause prohibiting settlement by insured.
“(a) Generally.
“It appears to be well settled that an insurer cannot breach its contract by unjustifiably refusing to defend an action against the insured, upon the ground that the claim upon which the action was based was outside the coverage of the policy, and at the same time take advantage of a policy provision prohibiting the insured from settling any claim except at his own cost without the consent of the insurer. Consequently, an insurer’s unjustified refusal to defend relieves the insured from his contract obligation not to settle, and the insured is at liberty to make a reasonable settlement or compromise without losing his right to recover on the policy.”

This rule was applied by the United States Supreme Court as early as 1906 in the leading case of St. Louis Dressed Beef & Provision Co. v. Maryland Cas. Co., 201 US 173, 50 L Ed 712, 26 S Ct 400.

The purpose of the “no action” clause is to protect the insurer from collusive or overly generous or unnecessary settlements by the insured at the expense of the insurance carrier. It is, however, unfair to the insured to enforce the clause against him when the insurer has erroneously refused to perform the insurance contract. The insurer had refused to participate in the suit and was in no position to expect to be a party to the settlement. And it is questionable whether the insurer is in all cases protected by requiring a judgment against the insured. This could be achieved by default or after an unenthusiastic defense. The insurer is protected by a showing, as was made in this case, that the settlement was made in good faith and for a reasonable amount.

In view of this court’s holding on the “no action” clause defense raised by the appellee, the error alleged in the trial court’s allowance of the amended answer raising that defense does not require extensive treatment. We observe, however, that the Illinois Supreme Court and this court have frequently affirmed the trial court’s broad discretion in allowing amendment of pleadings. See, for example, Kovalik v. Baldwin, 3 Ill App 2d 210, 121 NE2d 53 (1954).

The judgment is reversed and the cause remanded with instructions to enter judgment for the plaintiff.

Judgment reversed and cause remanded with instructions.

LYONS, P. J. and BURKE, J., concur.