Sherlock v. the Vill. of Winnetka

• Decision Date: 30 September 1871
• Parties: JOSEPH SHERLOCK et al.v.THE VILLAGE OF WINNETKA et al.
• Court: Illinois Supreme Court

59 Ill. 389

1871 WL 8055 (Ill.)

JOSEPH SHERLOCK et al.

v.THE VILLAGE OF WINNETKA et al.

Supreme Court of Illinois.

September Term, 1871.

OPINION TEXT STARTS HERE

APPEAL from the Superior Court of Cook county; the Hon. JOHN A. JAMESON, Judge, presiding.

This was a bill in equity, filed in the Superior Court of Cook county, by Sherlock and twenty-five others, as property owners and tax payers, against the village of Winnetka, the Winnetka Academy, and others, members of the council of said village, and the collector thereof.

It appears, from the allegations of the bill, and the acts of the general assembly referred to therein, that the village of Winnetka was incorporated by a special act. Private Laws 1869, vol. 4, p. 221.

Section 1 of article 2 of the act provides, that the municipal government of said village shall be composed of a president and five trustees, who together shall constitute the council of said village.

These officers are made elective. The same section provides for the election of a marshal, who shall be ex officio collector, for an assessor, and other officers. Section 1 of article 4 provides, that the council shall have power to purchase land in said village, and erect thereon buildings, and make other improvements for an educational institution of a high grade; to borrow money for such purposes, and issue bonds of said village in such form and for such amount, and for such time--not less than five years, nor more than twenty years--bearing such rate of interest, not exceeding ten per cent per annum, as the council may by ordinance provide, thereby pledging the corporate property and the faith and credit of said village for the payment of principal and interest of said bonds, with power to issue other similar bonds in like manner to pay or replace said bonds when they shall become due. Provided, that bonds exceeding in total amount of principal the sum of $20,000, shall not be issued in any one year; and, that the amount of principal of said bonds, outstanding and unpaid, shall not, at any one time, exceed the sum of $50,000.

The 5th section of same article declares the said village to be a school district, and the council to be ex officio a board of education, and that in addition to the powers which school directors have by law, the council shall have power to establish grade schools, and a high school, to build school houses for the same, and levy taxes for the erection and support of the same.

Superadded to these special powers, is the provision of section 4 of article 3, that: “The council shall have control of the finances and all the property, real, personal and mixed, within the corporate limits; and shall have power within said limits, by ordinance,” amongst other things, “to provide for, or erect, suitable buildings for the use of said village and its officers.”

It appears, from the allegations of the bill, that the “educational institution of a high grade,” mentioned in said section 1 of article 4, is, in fact, the Winnetka academy, for the incorporation of which an act was passed at the same session of the legislature which passed the act for incorporating said village. Private Laws 1869, vol. 1, p. 34. The corporators named in the first section of the last mentioned act, were Timothy Wright, Artemus Carter, R. M. Groves, Oliver W. Belden, David P. Wilder, B. Blake, O. S. Goss, Thomas Bassett and James L. Wilson.

The second section provides, that the concerns of the corporation should be managed by a board of nine trustees. The 3d section declared, that the persons named in the 1st section should constitute the first board, and hold their office for two years, and until their successors were elected and qualified.

It also appears from the bill, that the persons composing the council of the village, during the time of the transactions in question, were Artemus Carter, president, Timothy Wright, Barnum Blake, Julius P. Atwood, Thomas Bassett and O. S. Goss, trustees. Of the remaining officers, Abram P. Anthony was collector, and William H. Garland, assessor.

It further appears, from the allegations of the bill, that on the 7th day of May, 1869, the council passed an ordinance to raise money for the purchase of a lot, and making improvements thereon, authorizing the issue of bonds in the sum of $20,000, by the corporation; that, on the 2d of June, 1869, the council, claiming to act under said 1st section of article 4 of village charter, purchased of said James L. Wilson, block 50, in said village, containing two acres, for $2500, for the purpose of erecting thereon, as was pretended by them, a building for an academy or college; that, during that summer, and the fall of 1869, they did erect and finish, professedly for educational purposes, a large brick building on said block, inclosed the block with a fence, and made other improvements, at an expense of $11,800, or thereabouts; that, during the year 1869, but at what particular time the complainants could not state, the council caused to be issued $18,000 of said bonds, dated in said year, payable ten years after date, with interest coupons for interest thereon, at ten per cent per annum, payable semi-annually at the First National Bank in the city of Chicago; that said bonds were sold by said council at a discount from the face, and yet drew interest upon the whole amount named in the bonds, at ten per cent per annum; that all the consideration received by said village for said $18,000 of bonds, was the price of said lot, being $2500, and $11,800, or thereabouts, the cost of said improvements, making in all $14,300, or thereabouts; that the difference of $3700, or thereabouts, was allowed by said council as discount or shave money in getting the bonds cashed; that said council sold all, or nearly all, of said bonds, to the individual members of said council; that Wilson was paid in bonds, in whole or in part, for said lot, and the balance of $15,500 were sold to the members of said council, by the council, at seventy-five cents on the dollar, or thereabouts, said Carter taking the largest share of them at that rate, or about that rate, and said Goss, Bassett and Wright, taking a portion of them; that Carter, Bassett and Wright, and other members of the council, and said Wilson, combining together, have so managed the business by keeping their transactions secret, that the complainants have been unable to obtain further information as to the issuing of the bonds, or as to who are the present holders thereof.

The bill further alleges, that after the erection of said building on said block, the council, about the 30th of March, 1870, passed an ordinance for leasing said block and the improvements thereon, to said Winnetka academy, for the term of three years from the 1st of July, 1870, at a nominal rent, the condition of such letting being, that the academy should pay all taxes and assessments on the property; and inasmuch as said building and grounds are by law exempt from taxation, such letting amounts to a free lease of said premises; that said measure was adopted by the vote of said Atwood, Bassett, Wilder and Wright, and that said Bassett, Wilder and Wright, were at the same time corporators in said academy, and that, by their action, they thus virtually donated the use of said building and grounds to said academy, for the term of three years, which was, in fact, taking the property of the people and bestowing it upon themselves, without consideration, for their own benefit and interest; that, in accordance with such pretended lease, said academy took possession of said premises July 1st, 1870, and have continued such possession, and are conducting a private school in said building for their own gain and benefit.

The bill further alleges, that said council have not used, had not intended, and never have intended, to use the lands so purchased, or the building or buildings so erected thereon, for an educational institution of a high grade, for corporate purposes; but that the same was designed by the council for, and has already been appropriated to, the use of the private corporation as aforesaid, for private gain, and wholly foreign to the corporate purposes of said village; that, on the 7th of October, 1870, the council passed an ordinance directing the levy of a tax of thirteen mills on a dollar of the assessed value of real and personal property, eight mills of which is on account of said bonds, and to pay the interest thereon; that a warrant had been issued for the collection of said tax, and placed in the hands of said Abram P. Anthony, collector, who threatens to collect said tax by levying on the property of complainants, and that said collector is insolvent.

The bill also alleges, that the assessor completed the assessment of property, real and personal, for the year 1870, in said village, including the property of complainants; had signed and returned the list to the council about August 1st, 1870; that, in said list, he had assessed the property of the Chicago & Milwaukee Railway Company, on track, $11,500; on rolling stock, $8700; that, on September 21, 1870, the council directed their clerk to change said list, making a total reduction of the assessment of the property of said company, for the purposes of taxation, of $4700, and also directed the clerk to make a reduction of $550 from the assessed valuation of the personal property of O. S. Goss, one of the members of the council, which was accordingly done. But the bill does not allege that the property assessed as to which the reduction was made, was subject to taxation by the village authorities, or that Goss participated, as member of the council, in ordering the reduction as to his...