Chapman v. American Sur. Co.

Decision Date21 February 1914
Citation261 Ill. 594,104 N.E. 247
PartiesCHAPMAN v. AMERICAN SURETY CO.
CourtIllinois Supreme Court

OPINION TEXT STARTS HERE

Error to Appellate Court, Third District, on Appeal from Circuit Court, Vermilion County; W. B. Scholfield, Judge.

Bill in equity by Wilmer G. Chapman and others against the American Surety Company and another. A decree in favor of complainants was reversed by the Appellate Court, Third District (181 Ill. App. 146), and complainants bring certiorari. Judgment of the Appellate Court reversed, and decree of the circuit court affirmed.Acton & Acton, of Danyille, for plaintiffs in error.

O. M. Jones and Walter J. Bookwalter, both of Danville, for defendant in error.

CARTER, J.

This was a bill filed in the circuit court of Vermilion county, seeking to enjoin the parties to a judgment compelling a guardian to make an accounting under the statute, entered in that court in pursuance of a mandate of the Appellate Court. The trial court granted the injunction, and an appeal was taken to the Appellate Court for the Third District, which reversed the decision and remanded the cause, with directions to dismiss the bill for want of equity. The case has been brought to this court on a petition for certiorari.

Eli S. Sperry was the guardian, by appointment of the county court of Vermilion county, of the plaintiffs in error, who were minors. Defendant in error became the surety for said guardian March 23, 1907. In December, 1909, the grandfather of said minors notified said guardian that he would advance $7,000 to apply on the purchase of a tract of land for them. An 80-acre tract of land was selected and purchased at a cost of $7,656.25. Of this amount the grandfather furnished the $7,000 promised by him, and the guardian, after filing a petition and obtaining an order therefor in said county court, furnished the balance ($656.25) out of the guardian's funds in his hands. In October, 1907, the said guardian filed a petition in said county court asking leave to purchase about 168 acres of land in said county for said minors at a cost of $16,775.30. The petition was granted by said court, and the guardian purchased the land, paying therefor $7,000 in his hands out of the personal property of said minors, taking the land subject to a mortgage of $8,000, and giving a note signed by him, as said guardian, for $1,775.30. The title was taken in the name of the two wards. One of the wards became of the age of 14 years in August, 1908, and the other in January, 1911. Each, upon becoming of that age, named as his guardian his father, F. J. Chapman, who duly qualified as such guardian. In March, 1908, said Sperry, as guardian, filed a new bond, with other bondsmen than said defendant in error company. At the January term, 1909, of said county court, defendant in error, said surety company, filed a petition setting forth that it had been surety on said bond and the filing of a new bond with other bondsmen, and asked for an order requiring said guardian to file an account of his acts since his appointment, and that he be required to restore to the personal property the amount so taken to be invested in real estate; that upon such restoration and approval of the guardian's report said surety company be discharged from further liability as his bondsman. The county court sustained a demurrer to this petition. Said surety company then took an appeal to the circuit court of Vermilion county, which also sustained the demurrer. The company thereupon took an appeal to the Appellate Court for the Third District, where the judgement of the circuit court was reversed and the cause remanded,with directions to overrule the demurrer and require the guardian to file an account. American Surety Co. v. Sperry, 156 Ill. App. 19. On the case being remanded, the probate court (which had been established in Vermilion county to take the place of the county court in probate matters) required an accounting by the guardian, who thereafter filed his report, the surety company objecting to it on the ground that the court had no authority to direct that the personal property in question should be invested in real estate. The objections being overruled, the surety company took an appeal to the circuit court, which also overruled the objections and entered an order approving the report, including the investment of the funds in the real estate, and discharging said company from further liability on its bond as surety. That all the parties in this matter acted in good faith in the investment of the funds in the real estate is conceded. From this last decree of the circuit court the surety company again appealed to the Appellate Court, and that court held that the investment of the $656.25 by the guardian to complete the purchase of the first farm with the amount advanced by the grandfather was proper and legal, being in the nature of the removal of an incumbrance or balance due on the land, and necessary in order to protect the interests of the minors in the real estate. The Appellate Court further found that the guardian had no authority to invest in real estate the funds of the minors which had not been derived from real estate, and that the probate (county) court had no right to authorize the guardian to so invest the $7,000 which he did in the 168-acre tract. The Appellate Court reversed the judgment of the circuit court and remanded the cause, with directions to that court to direct the guardian to dispose of said last-named tract of land in which he had invested the $7,000, and restore the funds to the personal property; that upon turning over said funds to his successor the court should discharge said surety company from further liabilityon its bond; that the minors were entitled to whatever profits there might be upon the sale of said land over the amount invested therein; and that if said profits were less than the statutory interest, then said guardian should be required to account for such difference in interest. American Surety Co. v. Sperry, 171 Ill. App. 56.

After said cause had been reversed the first time by the Appellate Court and the petition of the surety company had been denied the second time by the probate court of Vermilion county, while the appeal of said surety company was pending and undetermined in the said circuit court, the original bill in this cause was filed against the surety company and the former guardian, Sperry. Both entered their appearance and filed a general demurrer to said bill. It seems that by mutual consent these chancery proceedings in the circuit court were permitted to stand while the statutory action on the petition of the surety company proceeded to final judgment in the circuit court on appeal. After the second appeal in said statutory matter had been decided in the Appellate Court, a supplemental bill of complaint was filed in the circuit court in this cause, alleging, in addition to the facts stated in the original bill of complaint, the facts as to the litigation as heretofore set out under the statutory proceeding and the result of that litigation as decided by the Appellate Court; that neither the county court nor probate court had authority of law to direct the guardian to invest the proceeds from the personal property in real estate. The supplemental bill further alleged that the complainants were minors under legal age, and therefore could not elect to retain and hold said real estate instead of the money invested in the same; that they owned in the same county some 800 acres near the said 168-acre tract; that they lived on said land, and would soon become of legal age; that each of them expected to follow farming as his life occupation; that said real estate, as above described, had increased in market value over $3,000 since its purchase,and was steadily increasing in value; that it was very much to the advantage of said minors that said land should not be sold but be retained by them, not only on account of the increase in value and the probable increase in the future, but also because they would need said land in their farming operations after reaching legal age. The supplemental bill further averred that neither the county nor probate court had power to review said investment after it was made, but that the circuit court, as a court of chancery, in the exercise of such jurisdiction over the estate of infants and for and in their behalf, was authorized by decree to ratify the investment of the proceeds of the personalty in real estate and enjoin the sale of said lands, and prayed that such order might be entered as was necessary to retain said lands for said infants. A general demurrer was filed by the surety company and by Sperry, the former guardian. This was overruled in the circuit court, and, the surety company and Sperry electing to stand by their demurrers, a final decree was entered finding the facts to be true as set forth in the supplemental bill, and granting the relief prayed.

[1][2][3][4][5] The first question presented in the briefs is whether a court of equity can, by an injunction, stay the proceedings, already prosecuted under our statute, compelling an accounting by the guardian as heretofore set out. The occasions on which the remedy of injunction may be used are almost infinite in their nature and circumstances. 2 Story's Eq. Jur. (13th Ed.) § 885. No branch of equity jurisdiction is more frequently invoked. The use of injunctions to stay actions at law was substantially coeval with the establishment of chancery jurisdiction. That jurisdiction was largely built up through the instrumentality of injunctions in restraining the prosecution of legal actions where the aid of chancery was sought because the equities of the case could not be considered in the common-law action. In the exercise of this jurisdiction courts of equity assert no supremacyover courts of law. The injunction virtually admits and assumes their jurisdiction. It is addressed to the litigant parties,...

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24 cases
  • Coppedge v. Clinton
    • United States
    • U.S. Court of Appeals — Tenth Circuit
    • July 28, 1934
    ... ...         On May 14, 1928, the American National Bank of Bristow, Oklahoma, was appointed by the county court of Creek County, as guardian ... Schindler v. Spackman (C. C. A. 8) 16 F.(2d) 45, 48; Chapman v. American Surety Co., 261 Ill. 594, 104 N. E. 247, 251; Pomeroy's Equity Jurisprudence (4th Ed.) ... ...
  • Khan v. BDO Seidman, LLP
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  • Estate of Swiecicki, In re, 59877
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    ... ... Nonnast cited Chapman v. American Surety Co. (1914), 261 Ill. 594, 104 N.E. 247, as authority for that holding ... ...
  • Alliance Ins. Co. of Philadelphia v. Jamerson
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    ... ... In American Central Ins. Co. v. Harmon Knitting Mills, 39 F.(2d) 21, 23, the United States Circuit Court of ... 32 C.J. 84. Thus in Chapman v. American Surety Co., 261 Ill. 594, 104 N. E. 247, 250, the court said: "The use of injunctions ... ...
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