Daven v. Downey

• Decision Date: 15 January 1942
• Docket Number: No. 26417.,26417.
• Citation: Daven v. Downey, 378 Ill. 543, 39 N.E.2d 45 (Ill. 1942)
• Parties: DAVEN et ux. v. DOWNEY et ux.
• Court: Illinois Supreme Court

378 Ill. 543

39 N.E.2d 45

DAVEN et ux.

v.DOWNEY et ux.

No. 26417.

Supreme Court of Illinois.

Nov. 24, 1941.

As Modified on Denial of Rehearing Jan. 15, 1942.

Appeal from Circuit Court, Lee County; Harry E. Wheat, Judge.

Suit by James Daven and Mary A. Daven, his wife, against Leo J. Downey and Ann Downey, his wife, to enforce the performance of an alleged contract to reconvey certain land. From a decree dismissing the complaint for want of equity, plaintiffs appeal.

Reversed and remanded with directions.

WILSON, J., dissenting.

Dixon, Devine, Bracken & Dixon, of Dixon (John P. Devine, Robert L. Bracken, and J. C. Ryan, all of Dixon, of counsel), for appellants.

Warner & Warner, of Dixon (Henry C. Warner, of Dixon, of counsel), for appellees.

SMITH, Justice.

This is a suit brought by appellants, James Daven and Mary A. Daven, his wife, against appellees, Leo J. Downey and Ann Downey, his wife. The purpose of the suit was to enforce the performance of an alleged contract in which it is claimed that appellee Leo J. Downey agreed to reconvey to appellants 320 acres of land located in Lee county, Illinois. The court below entered a decree dismissing the complaint for want of equity.

Appellants rely upon a written contract, or memorandum, which they claim was executed by appellee Leo J. Downey on October 24, 1936. Appellees claim that no such contract or memorandum was ever made or in existence.

The first question presented by the record in this case is, therefore, whether such a contract or memorandum was made or executed. Inasmuch as there is a sharp conflict in the testimony on this question, it becomes necessary to examine the evidence in the record, as well as the circumstances surrounding the parties, in detail. Appellant James Daven at the time of the trial was eighty-five years of age. His eyesight was greatly impaired. Appellee Leo J. Downey was his nephew. He was about forty-eight years of age. The undisputed facts in the record show that in 1935 appellant James Daven was the owner of the 320 acres of land in controversy. At that time he was indebted on a note to the First State Bank of Ohio, Illinois, on which there was due approximately $3791. He was also indebted to appellee Leo J. Downey on a note in the sum of $690, with approximately two, years' accrued interest. He also owed certain obligations to others. In 1935, the First State Bank of Ohio was in liquidation. The receiver of that bank obtained a judgment on the note of appellant James Daven in the circuit court of Bureau county. The amount of the judgment and costs was something over $4000. A transcript of that judgment was filed in the office of the circuit clerk of Lee county. An execution was issued under which the sheriff of Lee county sold the land. It was bid in by the receiver of the First State Bank of Ohio, the execution creditor. The record shows that during the period of redemption following this sale, appellant James Daven made repeated efforts to raise funds with which to redeem the land but was unsuccessful. At one time he offered the land for sale at public auction, with the result that there were no bidders who would pay the amount of the judgment. At the expiration of the period of redemption a deed was made by the sheriff conveying the land to Charles H. Albers, as receiver of the First State Bank of Ohio. The record indicates that after this deed was made the receiver was willing to reconvey the land to James Daven upon payment of the amount of the judgment, interest and cost, possibly less. Some negotiations were had between the deputy receiver of the bank and James Daven, with a view to working out some plan by which the receiver would accept a reduction in the amount due the bank and reconvey the premises to Daven. These negotiations were unsuccessful until the latter part of September, or early in October, 1936. Up to this time there is no substantial disagreement between the parties as to the facts. From this point on, however, there is a wide difference between the contentionsof the parties as to what occurred between them.

Appellant James Daven testified that during his negotiations with the receiver of the bank for the payment of his debt and the reconveyance of the property, he had a conversation with his nephew, appellee Leo J. Downey, in which he stated, in substance, to Downey, that the receiver of the bank had agreed to settle the bank's claim for $4000; that appellee Leo J. Downey agreed that if appellant Mary A. Daven would release an old mortgage for $500 which she held on one of the 40-acre tracts of the land involved, and would sign over her dower rights in the premises, he would advance the $4000 to pay the bank's claim; that he would take title, hold the land for two or three years, or until prices advanced, and would then sell it; that Downey would take what money he had put into it, together with the amount appellant James Daven owned him on the note, signed by Daven, amounting to $690 and interest, and turn over the balance for which the property sold to Daven. James Daven further testified that thereafter he and Leo J. Downey met at the office of the bank receiver for the purpose of closing the transaction. There is no dispute between the parties as to this meeting and the purpose for which they met. There were present at this meeting James Daven and Mary A. Daven, appellants; Leo J. Downey, appellee; D. W. Grant, now deceased, who was the deputy receiver in charge of this particular property and the transaction concerning the same; Paul D. Perona, an attorney representing the bank receiver; Leona Fenoglio, whose name was then Troy, a stenographer employed by the bank receiver; A. W. Hedrick, who was assisting deputy receiver Grant in liquidating the bank, and Oliver J. Gehant. Gehant was connected with a bank in West Brooklyn. Gehant was there for the purpose of making a loan of $4000 to Downey to enable him to pay the claim of the bank. The record further shows that during these negotiations attorney Skinner was present for a short time. He was called at the request of appellants and, apparently, advised with them briefly with reference to the proposed transaction. As to everything else that occurred at that time there is an irreconcilable conflict in the testimony.

James Daven testified that he and his wife objected to making a quitclaim deed to appellee Leo J. Downey for the land unless he would agree to hold the land until it could be sold for enough to repay Downey the money he would have to invest in it, together with the note and interest owing to him by James Daven; that Mary A. Daven held the $500 mortgage on the one 40-acre tract of the land which Downey demanded she release; that she refused to release this mortgage until Leo J. Downey would enter into a contract as suggested. James Daven further testified that Downey agreed to these demands and that Paul Perona dictated a contract or memorandum to Mrs. Fenoglio, the stenographer; that the contract or memorandum was written by her and was signed by Leo J. Downey after it was prepared; that the question was asked: ‘Who will keep this agreement?’ That Downey suggested, ‘Well, Mr. Gehant is going to to have the rest of the papers, better give it to him.’

Paul D. Perona, an attorney of more than fifteen years standing, testified that he was present at this meeting. He was the attorney for the bank receiver. He had negotiated with both Daven and Downey about the payment of the bank's claim and the reconveyance of the property upon payment, or settlement of that claim. He testified that Daven and Downey talked about getting the farm back at that meeting. He further testified that prior to the date of this meeting he had negotiated with James Daven and Leo J. Downey in regard to the settlement of the claim of the receiver of the bank; that the witness and the then deputy receiver of the bank had agreed to accept $4000 in full satisfaction of the claim; that James Daven paid $100 of the $4000 demanded, to the deputy receiver; that on October 24, 1936, the day on which the matter was closed, during the discussion Skinner was called in by appellants and talked with them; that Downey finally agreed to put up the $4000 necessary to satisfy the bank's claim; that Daven and Mrs. Daven did not want to sign her dower rights away unless they had an opportunity to buy the land back from Downey for the amount he put in it; that after some further discussion Downey agreed to sell the farm back to James Daven for the money he put into it, plus the money Daven had obtained from time to time, the amount of which Perona did not know. The matter was discussed back and forth by Downey, Daven and Gehant. Daven wanted a contract from Downey agreeing that he would deed the land back to him when Downey had been repaid the money he had invested in it. Perona further testified that he dictatedto Mrs. Fenoglio, a contract. The witness understood that Gehant was furnishing the money to Downey. Gehant objected to any contract being placed on record. He gave as his reason that he could not loan money on the land with a contract on record which permitted appellants to buy the farm back. This witness further testified that the contract he dictated to the stenographer provided that Daven and his wife would have a right to buy the farm back for the amount Downey put into it; that the contract was not to be recorded; that it was provided in the contract that if it was recorded it would be null and void. He further testified that they then discussed the question of what should be done with the contract. He stated positively that Downey signed the contract in his presence, in the presence of the stenographer and the presence of Grant, the deputy receiver. He further testified that after the contract was signed by Downey it was turned over to Gehant with other papers that were made that day. A petition was filed by the witness, as attorney for the receiver, for...