First Nat. Bank of Palatine v. Hahnemann Institutions of Chicago, Inc.

• Decision Date: 06 June 1934
• Docket Number: No. 22014.,22014.
• Citation: 190 N.E. 707,356 Ill. 366
• Parties: FIRST NAT. BANK OF PALATINE v. HAHNEMANN INSTITUTIONS OF CHICAGO, Inc., et al.
• Court: Illinois Supreme Court

356 Ill. 366

190 N.E. 707

FIRST NAT. BANK OF PALATINE

v.HAHNEMANN INSTITUTIONS OF CHICAGO, Inc., et al.

No. 22014.

Supreme Court of Illinois.

April 21, 1934.

Rehearing Denied June 6, 1934.

Error to Third Branch Appellate Court, First District, on Appeal from Municipal Court of Chicago; Howard Hayes, Judge.

Action by the First National Bank of Palatine against the Hahnemann Institutions of Chicago, Incorporated, wherein the Central Republic Bank & Trust Company, successor by consolidation to the Central Trust Company of Illinois, was garnished. To review a judgment in the Appellate Court which affirmed a judgment against the garnishee, the garnishee brings certiorari.

Reversed and remanded, with directions.Fisher, Boyden, Bell, Boyd & Marshall, of Chicago (Earl K. Schiek, of Chicago, of counsel), for plaintiff in error.

Miller, Gorham, Wales & Adams and William Annan Taylor, all of Chicago (Frederic O. Mason, of Chicago, of counsel), for defendant in error.

DE YOUNG, Justice.

The municipal court of Chicago rendered a judgment by confession, on August 11, 1930, for $2,391.08 and costs in favor of the First National Bank of Palatine and against the Hahnemann Institutions of Chicago, Inc. On August 25, 1930, leave was granted to the defendant to appear and defend, the judgment to stand as security, and the execution theretofore issued was stayed until the further order of the court. An affidavit of merits was interposed, the cause was tried without a jury, and on November 21, 1930, the judgment by confession was confirmed. The execution was returned unsatisfied, and thereafter, on December 8, 1930, garnishment proceedings were instituted against the Central Trust Company of Illinois. The garnishee answered that at the time of the service of the garnishee summons it held $2,443.75 in its possession belonging to the Hahnemann Institutions of Chicago, Inc. The judgment entered on November 21, 1930, was vacated on December 15, 1930, and the cause was reinstated. The court, as the result of the second trial, on January 13, 1931, found the issues against the First National Bank of Palatine and vacated the judgment of August 11, 1930. The Central Trust Company of Illinois thereafter moved to be discharged as garnishee, but on February 3, 1931, its motion was overruled. The First National Bank of Palatine prosecuted an appeal from the judgment of January 13, 1931. The Appellate Court for the First District, on December 2, 1931, reversed that judgment, and, without remanding the cause, rendered judgment for $2,550.39 and costs, in favor of the appellant ang against the Hahnemann Institutions of Chicago, Inc. A certified copy of the Appellate Court's judgment was filed in the office of the clerk of the municipal court and an alias execution was issued. The Central Republic Bank & Trust Company, successor by consolidation to the Central Trust Companyof Illinois, was summoned as garnishee, and answered that it was indebted to the Hahnemann Institutions of Chicago, Inc., in the sum of $80.67. This bank made two motions, the first to quash the second garnishment writ, and the second to quash the first writ, and, in each instance, to be discharged as garnishee. The first motion was granted, the second denied, and judgment was rendered against the Central Republic Bank & Trust Company, the garnishee, for $2,443.75. The garnishee prosecuted an appeal to the Appellate Court for the First District, and that court affirmed the judgment. A writ of certiorari was granted by this court, and the record is submitted for a further review.

The contention of the plaintiff in error, the Central Republic Bank & Trust Company, is that, since the municipal court of Chicago rendered the judgment in the principal suit against the plaintiff, the First National Bank of Palatine, on January 13, 1931, there has been no valid and subsisting judgment upon which the garnishment proceeding can be based.

Garnishment is an ancillary proceeding in the nature of process to obtain satisfaction of a judgment rendered in the principal action of proceeding. Dennison v. Taylor, 142 Ill. 45, 31 N. E. 148;Bear v. Hays, 36 Ill. 280;Chanute v. Martin, 25 Ill. 63. It is a statutory proceeding, and a party seeking its benefits must comply strictly with the requirements of the statute. 2 Lewis' Sutherland on Stat. Const. (2d Ed.) § 694; Levinson v. Home Bank & Trust Co., 337 Ill. 241, 169 N. E. 193;Siegel, Cooper & Co. v. Schueck, 167 Ill. 522, 47 N. E. 855,59 Am. St. Rep. 309;Illinois Central Railroad Co. v. Weaver, 54 Ill. 319;Michigan Central Railroad Co. v. Keohane, 31 Ill. 144. Section 1 of the Garnishment Act provides that, whenever a judgment shall be rendered by a court of record and an execution against the defendant in such judgment shall be returned ‘no property found,’ then, upon the filing with the clerk of the court, of the affidavit of the plaintiff or other credible person setting forth the requisite facts, it shall be lawful for the clerk to issue a summons against the person supposed to be indebted to, or to have any of the effects or estate of, the defendant. Smith-Hurd Rev. St. 1933, c. 62, § 1, p. 1555; Cahill's St. 1933, c. 62, par. 1, p. 1509. The existence of a valid judgment against the principal defendant is therefor a jurisdictional prerequisite in a proceeding under the Garnishment Act. Jurisdiction cannot be acquired in the absence of any one of the required conditions. La Salle Opera House Co. v. La Salle Amusement Co., 289 Ill. 194, 124 N. E. 454; Chanute v. Martin, supra. Payment by the garnishee of a void judgment would not effect a reduction of liability to the principal debtor. Kirk v. Dearth Agency, 171 Ill. 207, 49 N. E. 413; Dennison v. Taylor, supra; Pierce v. Carleton, 12 Ill. 358, 54 Am. Dec. 405. Since a subsisting judgment is essential, not only as a foundation for a judgment in the garnishment proceeding, but also for the protection of the garnishee, it follows necessarily that the latter has the right to interpose the defense of the court's want of jurisdiction to proceed. La Salle Opera House Co. v. La Salle Amusement Co., supra; Kirk v. Dearth Agency, supra; Dennison v. Taylor, supra.

Upon opening a judgment by confession to permit a defense to be pleaded, the court may order the judgment to stand as security pending the determination of the controversy on its merits. 3 Freeman on Judgments (5th Ed.) § 1343; Pearce v. Miller, 201 Ill. 188, 66 N. E. 221;Blake v. State Bank of Freeport, 178 Ill. 182, 52 N. E. 957;Farwell v. Huston, 151 Ill. 239, 37 N. E. 864,42 Am. St. Rep. 237;Stein v. Good, 115 Ill. 93, 3 N. E. 735;Page v. Wallace, 87 Ill. 84;Condon v. Besse, 86 Ill. 159;Norton v. Allen, 69 Ill. 306. This practice was followed, for the order of August 25, 1930, recited that the judgment of August 11, 1930, should stand as security until the further order of the court. Upon the entry of such an order, the judgment exists only for that purpose. An order of the character permits the interposition of a defense while it saves to the plaintiff the rights he acquired by the judgment in the event the defense proves unavailing. Wenham v. International Packing Co., 213 Ill. 397, 72 N. E. 1079. After the second trial on the merits and the rendition of the judgment of January 13, 1931, there was no longer any subsisting judgment in favor of the plaintiff in the original suit and nothing remained to be secured. The municipal court had jurisdiction of the subject-matter and of the parties at each of the two trials. The judgment of January 13, 1931, even though it may have been...