Bagdonas v. Liberty Land & Inv. Co.

• Decision Date: 20 June 1923
• Docket Number: No. 15330.,15330.
• Citation: 309 Ill. 103,140 N.E. 49
• Court: Illinois Supreme Court
• Parties: BAGDONAS et al. v. LIBERTY LAND & INVESTMENT CO. et al.

309 Ill. 103

140 N.E. 49

BAGDONAS et al.

v.LIBERTY LAND & INVESTMENT CO. et al.

No. 15330.

Supreme Court of Illinois.

June 20, 1923.

Error to Second Branch, Appellate Court, First District, on Appeal from Circuit Court, Cook County; George Fred Rush, Judge.

Suit by John Bagdonas and others against the Liberty Land & Investment Company and others. The Appellate Court reversed an order appointing a receiver pendente lite for defendant named, and complainants bring error.

Affirmed.

Thompson, J., dissenting.Harold O. Mulks, of Chicago, for plaintiffs in error.

Moses, Rosenthal & Kennedy, of Chicago (Hirsch E. Soble, of Chicago, of counsel), for defendants in error.

STONE, J.

Plaintiffs in error, as stockholders of the Liberty Land & Investment Company, on behalf of themselves and all other stockholders, filed their bill in the circuit court of Cook county against said company and others, defendants in error herein, praying for a writ of injunction against the defendants in error, commanding that they refrain from misappropriating the funds of the company in the manner alleged in the bill of complaint. The bill also prayed that a receiver be appointed for the company. On motion of the solicitor for the complainants, the chancellor, without notice to the defendants, entered an interlocutory order appointing a receiver pendente lite. Defendants in error thereupon appealed to the Appellate Court for the First District, by filing their appeal bond in the sum of $250 with the clerk of the circuit court, who approved the same, as provided in section 123 of the Practice Act (Hurd's Rev. St. 1921, c. 110). The plaintiffs in error here did not join in errors assigned by the defendants in error as appellants in the Appellate Court, but upon the convening of that court moved to dismiss the appeal for the reason, among others assigned, that section 123 of the Practice Act is in violation of section 22 of article 4 of the Constitution of Illinois and of the Fourteenth Amendment to the Constitution of the United State, in that said section confers a special right and privilege on those against whom a receiver is appointed by allowing such parties an appeal, while an appeal is not allowed to the applicant for appointmentof a receiver when the same is denied. The Appellate Court overruled the motion to dismiss the appeal, and the plaintiffs in error in this court took no further action in the proceedings had before the Appellate Court. That court reversed the order appointing a receiver, upon the ground that the averments of the bill were not sufficient to warrant such appointment. Thereupon the complainants sued out of this court a writ of error to the Appellate Court, assigning as error the refusal of the Appellate Court to dismiss defendants in error's appeal.

Plaintiffs in error's contentions are that section 123 of the Practice Act is unconstitutional, and the Appellate Court was without jurisdiction to review the order appointing a receiver. Defendants in error have filed in this court a motion to dismiss the writ of error for want of jurisdiction in this court to review the order of the Appellate Court.

Section 123 of the Practice Act, so far as applicable here, provides that appeals may be taken in the manner therein prescribed from a decree or order appointing a receiver, to the Appellate Court of the district in which the appointing court is located. The party taking the appeal shall give bond, to be approved by the clerk of the court below, to secure costs in the Appellate Court. That section also provides that upon filing the record in the Appellate Court the same shall be docketed at once and hearing thereon shall take precedence over other causes.

The Appellate Court may affirm, modify, or reverse such interlocutory order or decree, and direct that such proceedings be had in the court below as justice may require. Attorney's fees may be allowed, to be taxed as costs in case the appeal is dismissed. No appeal shall lie or writ of error be prosecuted from the order entered by the Appellate Court on any such appeal.

Plaintiffs in error assign numerous errors on the record, but as section 123 of the Practice Act makes the judgment of the Appellate Court final, such judgment is not reviewable in this court on assignments of error affecting the merits.

Plaintiffs in error attack the validity of section 123 of the Practice Act on the following grounds: First, that it violates section 22 of article 4 of the Constitution, in that it grants special rights, privileges and immunities to the defendant in an application for appointment of a receiver over his property by giving him a right of review while such right is denied the complainant, and the provision of said section of the Constitution prohibiting the passage of a special law where a general law would be applicable; second, that it violates section 13 of article 4 of the Constitution, in that certain provisions in section 123 of the act are not expressed in the title thereof; and, third, that it confers judicial power upon the clerk of the court by permitting him to fix and approve the bond on appeal.

Defendants in error filed their motion to dismiss the writ of error here, urging that this court has no jurisdiction, for the reason that section 91 of the Practice Act authorizes writs of error only in cases of final judgments of inferior courts, and that, since this is an interlocutory order, the statute confers no jurisdiction on this court to review the decisions of the Appellate Court; that the whole matter of the review of an interlocutory order being statutory, this court is bount by the statute.

Section II of article 6 of the Constitution, concerning the organization of Appellate Courts, provides that appeals and writs of error shall lie from the Appellate to the Supreme Court in all criminal cases and cases in which a franchise or freehold, or the validity of statute, may be involved, and in such other cases as may be provided by law, It will thus be seen that the jurisdiction of this court to review judgments of the Appellate Court in cases where the validity of a statute is involved is conferred, not by the Practice Act, but by the Constitution.

Defendants in error argue, however, that under the decisions of this court plaintiffs in error by failing to move to transfer the cause from the Appellate Court to this court, have waived the constitutional question. The cases cited in support of this contention are those in which constitutional objections were assigned on the judgment or decree of the trial court, and it is the uniform holding of this court in such cases that the appellant, by seeking a review in the Appellate Court, waives any constitutional question. This is not such a case. Here no constitutional question was raised in the trial court, but appeared for the first time in the Appellate Court, and was a challenge to the jurisdiction of that court on constitutional grounds. No reason is perceived why the Appellate Court, in a case where a constitutional question affecting the jurisdiction of that court is first raised there, is not authorized to pass upon the constitutionality of the act attacked, as a trial court is allowed to do. By section II of article 6 of the Constitution its judgment on such question is subject to review by a writ of error in this court. The Appellate Court had power of pass upon the constitutional question and a review of its decision on such question is rightly before us on writ of error. The motion to dismiss the writ of error will therefore be denied.

The effect of the decision of the Appellate Court is to uphold the validity of section 123 of the Practice Act. We come then to consider plaintiffs in error's first contention concerning the invalidity of that section, which is that it is void because in violation of section 22 of article 4 of the Constitution. Whether or not the Legislature has power to pass an act giving the right of review to one party and denying it to another in the same proceeding depends upon whether or not there exists a rational difference in the classification of such parties as made by the act. The right of appeal is not essential to due procee of law. People v. Omen, 290 Ill. 59, 124 N. E. 860;Saylor v. Duel, 236 Ill. 429, 86 N. E. 119,19 L. R. A. (N. S.) 377;Lott v. Pittman, 243 U. S. 588, 37 Sup. Ct. 473, 61 L. Ed. 915;Reetz v. Michigan, 188 U. S. 505, 23 Sup. Ct. 390, 47 L. Ed. 563. The Legislature has power to make classifications in judicial or administrative proceedings, and if such classification is based on a rational difference, may, in so doing give to a party belonging to one class two hearings before his rights are determined and to one belonging to a different class one hearing, only. Saylor v. Duel, supra; Pittsburg, Cincinnati, Chicago & St. Louis Railway Co. v. Backus, 154 U. S. 421, 14 Sup. Ct. 1114, 38 L. Ed. 1031.

In United States v. Heinze, 218 U. S. 532, 31 Sup. Ct. 98, 54 L. Ed. 1139, 21 Ann. Cas. 884, the contention was made that a statute enacted by Congress giving to the government the right of appeal as to certain questions before trial and to the defendant in such suit by the government the right of review only at the end of the trial, was void because it contravened the due process clause of the federal Constitution and denied an equal protection of the laws. It was there held that an appeal is not essential to due process of law; that Congress, while it has no power to discriminate as to persons of the same class, has power to make a reasonable classification; and that the act in question came within that power. A similar question was before this court in McGinnis v. McGinnis, 289 Ill. 608, 124 N. E. 562, where...