Clary v. Schaack

• Decision Date: 03 April 1912
• Citation: 97 N.E. 1070,253 Ill. 471
• Parties: CLARY v. SCHAACK et al.
• Court: Illinois Supreme Court

253 Ill. 471

97 N.E. 1070

CLARY

v.SCHAACK et al.

Supreme Court of Illinois.

Feb. 23, 1912.

Rehearing Stricken April 3, 1912.

Appeal from Circuit Court, Cook County; John Gibbons, Judge.

Suit by Ann Clary against Edward M. Schaack and others. From a decree of dismissal for want of equity, complainant appeals. Affirmed.Frederick L. Brooks and Leman & Rigby, for appellant.

Vincent D. Wyman and Otto W. Jurgens, for appellees.

Ann Clary, on November 19, 1910, filed in the circuit court of Cook county a bill to set aside several conveyances of certain real estate, and for other relief. The bill was dismissed upon demurrer for want of equity, and the complainant appealed.

The bill alleges that the complainant became the owner of the real estate in controversy, located at the northeast corner of North State and Chestnut streets, in the city of Chicago, on October 4, 1864, and occupied it with her family, as their homestead, until the great fire of October 9, 1871, destroyed the dwelling. After that event, she and her children, her husband having died, were compelled to live elsewhere until 1876, when she purchased a two-story frame building, which she moved on the premises and occupied with her children. She was then 45 years old, illiterate, ignorant of business, without means, other than this real estate, which had been conveyed to her by her husband, and she supported herself and her children by washing and ironing. The price of the building was $350, and in order to pay for it she borrowed of Edward Knauer $600, for which she gave him her promissory note, due in three years, together with 6 interest notes, for $30 each, for the semiannual interest at 10 per cent. until the maturity of the principal note. The date of the transaction was August 16, 1876, and the loan was secured by a trust deed of the real estate in controversy with a power of sale; the property then being worth $5,000. Knauer had been and was at this time the friend, adviser, and agent of the complainant, and he paid to her only $54.65 in cash of the proceeds of the loan, retaining the price of the building, his charges, and $100 to be applied on the interest notes when due. He told the complainant that she need not bother about the payment of any of the notes, ad he would look out for her, and if she was unable to pay the notes when called upon he would either take care of them himself, or cause a new loan to be made, as the property was increasing in value, so that a new loan could easily be obtained. The complainant frequently talked with Knauer about the loan, and he told her that everything was all right, and she need pay no attention to the matter until he called upon her to do so.

Relying upon these statements, the complainant was lulled into security, and had no fear of her rights being in any danger; but on December 7, 1878, she was forcibly ejected from the premises by certain persons claiming to be officers of the law and to have a writ authorizing such jectment, who said that Michael J. Schaack had become the owner of the premises. On inquiry of Knauer, he informed the complainant that he had disposed of her notes to Andreas Michel, and that the latter, on account of an alleged failure to pay two of the interest notes, had caused the premises to be sold by virtue of the power of sale in the trust deed, and had bought them at the sale on November 11, 1878, and obtained a deed therefor. Schaack told the complainant that he knew nothing about the matter, except that he had bought the premises from Michel on November 14, 1878, for $1,400, and he threatened to make it hard for the complainant if she tried to make him trouble, but promised her that if she did not she could have the premises at any time upon payment of $1,400, and that in the meantime he would hold the title for her. Being ignorant of her rights and deterred from making full inquiry by reason of her confidence in the information and promises of Knauer and Schaack-particularly in Schaack's, because of his high standing in police circles-the complainant continued to work and save, in order to accumulate sufficient money to pay Schaack and recover the premises; but after several years, when she had accumulated almost enough for this purpose, she heard of Schaack's death, and then, believing her rights in the property gone, she ceased all thought or effort in regard to it until about two weeks before the filing of the bill, when she was advised to consult a lawyer. She did so, and through this source first obtained knowledge of the conspiracy between Knauer and Schaack, whereby the sale of the premises was made without notice to her, and without her knowledge, Knauer and Schaack having conspired to enable Schaack to obtain the property by having it sold without the complainant's knowledge. Knauer pretended to sell the complainant's notes to Michel, though, in fact, Schaack owned them, and no demand of payment was made upon complainant, nor was notice given her of any default in the terms of the trust deed, though she was all the time relying upon Knauer's promises in regard to her notes, such promises having been made for the purpose of keeping her in ignorance of Knauer's acts, and in furtherance of the conspiracy between him and Schaack, and no money was due nor was there any default in the payment of interest at the time of the sale. Michel was a police officer and a relative of Schaack, and acted under his directions without any interest in the transaction, merely permitting the use of his name. Schaack was present at the sale and bid for the property. He caused Michel to bid also, and, as prearranged, the property was sold to Michel on his bid of $700, though no money was paid, and the complainant received no credit for the surplus. Immediately after the sale, Knauer, as trustee, made a deed conveying the property to Michel, and the latter, three days afterward, conveyed it by special warranty deed to Michael J. Schaack and Christine Schaack, his wife, as joint tenants; the latter having knowledge of all the fraudulent acts in relation to the sale, as well as of her husband's promise to hold the premises in trust for the complainant. Afterwards, on December 30, 1878, Knauer executed a second trustee's deed to Michel, which recited that it was made to supply defects in the prior deed, and ‘that said sale was made by reason of default having been made on the interest notes falling due 18 and 24 months, respectively, and that, five weeks' notice of said sale being required, he did publish said notices in the Chicago Lagal News; the date of the first publication being October 8, 1878, and the...