Fritze v. Equitable Bldg. & Loan Soc. of Peoria

• Decision Date: 21 June 1900
• Citation: 186 Ill. 183,57 N.E. 873
• Court: Illinois Supreme Court
• Parties: FRITZE v. EQUITABLE BUILDING & LOAN SOC. OF PEORIA.

186 Ill. 183

57 N.E. 873

FRITZE

v.EQUITABLE BUILDING & LOAN SOC. OF PEORIA.

Supreme Court of Illinois.

June 21, 1900.

Appeal from appellate court, Second district.

Action by James P. Fritze against the Equitable Building & Loan Society of Peoria for salary and commissions. From a judgment of the appellate court (83 Ill. App. 18) reversing a judgment in favor of plaintiff, he appeals. Affirmed.Dan. R. Sheen and A. Kreisman, for appellant.

Winslow Evans (John J. Crowder, of counsel), for appellee.

This is an action of assumpsit brought by the appellant, James P. Fritze, for the use of M. N. Gish, against the appellee, the Equitable Building & Loan Society of Peoria, to recover for services alleged to have been rendered to appellee under a written contract. The declaration as finally amended consists of a special count upon the contract and the common counts. The defendant filed the general issue and three special pleas. The second plea was demurred to, and to it, as finally amended, a replication was filed, making an issue upon the second amended plea. The third and fourth amended pleas were demurred to, and, the demurrers being sustained, the defendant elected to abide by its third and fourth amended pleas.

By stipulation between the parties, it was agreed that the issues, whether of law or of fact, should be tried by the court without a jury. Upon the trial the court gave and held one proposition of law for the defendant below, the appellee here, and marked as refused three propositions of law submitted by the defendant below. The court found the issue for the plaintiff below, the appellant here, and assessed his damages at the sum of $1,660. The motion to set aside the finding and for a new trial was overruled, and judgment for $1,660 was rendered in favor of appellant and against appellee upon the finding so made. Thereupon the defendant below, the Equitable Building & Loan Society of Peoria, took an appeal to the appellate court. The appellate court rendered a judgment reversing the judgment of the circuit court without remanding the cause. The judgment of the appellate court is: ‘It is considered by the court that, for that error and others in the record and proceedings aforesaid, the judgment of the circuit court of Peoria county in this behalf rendered be reversed, annulled, set aside, and wholly for nothing esteemed.’ The present appeal is prosecuted from the judgment of reversal so entered by the appellate court.

The declaration alleges that the appellee, as party of the first part, on May 2, 1892, and at its office in Peoria, made a written contract with appellant, Fritze, as party of the second part, the material part of which is as follows: ‘Witnesseth, that the said party of the first part does hereby employ the party of the second part as manager of agencies, to perform the services as designated in section 6 of article 3 of the society's by-laws. The said second party shall receive as his compensation out of the expense fund of said society, as such manager of agencies, for his services of the year, and in liquidation of all claims, the sum of $300 monthly, and two cents per share per month, during the year of this contract, of each and every one of the monthly payments actually made upon every share of stock subscribed to the Equitable Building and Loan Society in the twenty-fifth to the thirty-sixth series, inclusive. The pay for these services shall be due and payable monthly, in sums not less than one cent per share per month of all the shares in good standing in the society, and as much more as the expense fund will admit, until such salary and commissions accrued under this contract are paid in accordance with the provisions of the same. The first party agrees to pay all the necessary traveling expenses of the second party when necessarily traveling in the interest of the society. This contract of employment to extend and be in full force and effect for one year from May 2, 1892.’ The declaration further avers that on May 14, 1892, said contract was ratified and approved by the society through its board of directors, and ordered spread upon the minutes; that said section 6 of article 3 of the by-laws is as follows: ‘The board of directors may appoint a manager, who shall, under their direction, appoint all agents, and their compensation shall be paid out of the expense fund. He shall control and manage the agency system of the society. He shall perform such other duties as the board of directors may require, and shall attend to all publications, printing, and advertising. His term of office and compensation for said employment shall be fixed by written contract by the board of directors, and shall be paid out of the expense fund.’ The declaration then avers that on February 15, 1893, Fritze had performed the services required of him under the contract, and had an accounting and settlement with the society of the amount due to him thereunder, to wit, $2,000, part of which was paid by the society to Fritze, leaving a balance of $1,790 due to him, which balance Fritze is alleged to have assigned to Moses N. Gish, the usee herein, by written assignment indorsed upon the contract; that the society had notice and knowledge of said assignment, and promised to pay the same to said usee; that ample sums of money were collected by the society under section 4 of article 1 of the by-laws to pay him according to the provisions of said contract; that section 4 of article 1 of said by-laws is as follows: ‘Every stockholder shall pay in advance a membership fee of $1.00 on each share subscribed, which, together with eight cents per share per month on each monthly installment, shall constitute the expense fund, which the directors shall cause to be used in the vigorous and competent prosecution and extension of the business of the association so far as practicable.’ The declaration further avers that the membership fee, together with the eight cents per share upon each installment collected by the society under said section 4 of article 1, was turned into and became a part of the expense fund for the uses specified in said section 4 of article 1, and the expense fund thereby became and was amply sufficient on February 15, 1893, and at various other times before the beginning of this suit, to pay the sum of $1,790 due plaintiff as aforesaid.

The second amended plea alleged that the only cause of action in the declaration is that upon the contract in the first count thereof; that, at the time of making the contract and performing the alleged services, the defendantsociety was a corporation organized and doing business under ‘An act to enable associations of persons to become a body corporate to raise funds to be loaned only among the members of such association,’ in force July 1, 1879; that at that time Fritze was vice president of the defendant corporation, and a director and officer thereof; that, under the charter and by-laws of the society, the directors thereof had no power or authority to provide for an agency system of the society, or to provide for or appoint agents other than the officers and directors named by law, or to appoint a manager of agencies; and that, therefore, the society had no power or authority to enter into the contract set up in the first count of the declaration, and that the same is null and void. The replication to the second amended plea sets up that, at the time of the making of the contract and performing of the services thereunder, there was in force a valid by-law of the society, to wit, said section 6 of article 3 of the society's charter and by-laws, by virtue of which the society was duly empowered and authorized to make said contract.

The third amended plea avers that the only cause of action in the declaration is that set up in the first count thereof; that at the time of making the contract and performing the services aforesaid the society was a corporation organized under said act of July 1, 1879; that at that time the appellant, Fritze, was vice president of the corporation and an officer thereof; that under the charter and by-laws it was the duty of its president, among other things, that he should generally supervise the affairs of the association, and that, in case of his inability the act, the vice president should perform all the duties incumbent upon the president during the time of such disability; that the duties thus imposed upon the president, and, in case of his disability, upon the vice president, were in part the same duties and services provided for in said contract, and which the said Fritze agreed to perform in and by said contract; that, by reason of the premises, it was the duty of said Fritze to render the said services as vice president and as an officer of the society without compensation; and that, therefore, it was beyond the power and authority of the society to execute said contract, and the same is null and void.

The fourth amended plea avers, in addition to the averments contained in the third amended plea, that, at the time of making the contract and of performing the services alleged, Fritze was vice president and a director and officer of the society; that it was the duty of the president, among other things, to exercise general supervision over the affairs of the association, and it was the duty of the vice president, in the absence or disability of the president, to perform said duties and exercise said supervision over the affairs of the association; that, in and by the charter and by-laws of the society, the directors shall hold a meeting on the first Tuesday of each month at 7:30 o'clock p. m., at which times all the money in the treasury belonging to the loan fund shall be offered, and bids received therefor, and the stockholder that shall bid the highest premium for the preference or priority of the loan shall be entitled to receive the loan of $100 for each share of stock held by him; that it was also...