Frye v. the President

• Decision Date: 31 December 1848
• Citation: 10 Ill. 332,5 Gilman 332,1848 WL 4169
• Parties: WILLIAM FRYE, impleaded, etc.v.THE PRESIDENT, DIRECTORS AND CO. OF THE BANK OF ILLINOIS et al.
• Court: Illinois Supreme Court

5 Gilman 332

10 Ill. 332

1848 WL 4169 (Ill.)

WILLIAM FRYE, impleaded, etc.

v.THE PRESIDENT, DIRECTORS AND CO. OF THE BANK OF ILLINOIS et al.

Supreme Court of Illinois.

December Term, 1848.

BILL IN CHANCERY, in the Calhoun circuit court, brought by the Bank of Illinois, for the use of David A. Smith and Samuel Dunlap, its assignees, with George W. Atchison, the Union Insurance Company and the Missouri Insurance Company of St. Louis, who sued for the use of the said Atchison and said Missouri Insurance Company, against John Shaw and William Frye, for the purpose of setting aside certain conveyances alleged to be fraudulent, etc.

At the September term, 1846, the bill was taken pro confesso as to Frye and an interlocutory decree entered that he be barred, etc., unless he pay the complainants by the first day of the next term. Subsequently Shaw filed an answer.

At the May term, 1847, Frye filed affidavits and entered a motion to set aside the interlocutory decree, and asked leave to file an answer then prepared. A counter affidavit was filed, and the court refused to allow the motion. Decrees were then entered setting aside certain conveyances, and ordering a sale of mortgaged lands, etc.

Frye excepted to the decisions of the court, and alone brings the cause into this court by writ of error.

E. KEATING and H. W. BILLINGS, for the plaintiff in error:

1. A party seeking the aid of a court of equity must show distinctly and unambiguously all the facts necessary to entitle him to that aid. Shepard v. Shepard, 6 Conn. 37; Wright v. Dame, 22 Pick. 59; Hobart v. Frisbie, 5 Conn. 592; Steele's Heirs v. McDowell, 2 Bibb, 124; Morrison's Exec'rs v. Hart, ib. 6; Lemaster v. Buckhart, ib. 26.

2. To enable a foreign corporation to maintain a bill of complaint, its corporate existence should be averred, and also its power to sue. Central Manufacturing Co. v. Hartshorne, 3 Conn. 199; Lewis v. Bank of Ky., 12 Ohio, 148-9-50; Society Prop'n Gospel v. Young, 2 N. H. 312; School Dist. v. Blaisdell, 6 do. 198; Bank of Michigan v. Williams, 5 Wend. 482.

3. A corporation has no powers except such as are specially granted, and those that are necessary to carry into effect the powers so granted. Angell & Ames on Corporations, 65, 66, 122, 192, 198; N. Y. Fireman Ins. Co. v. Sturges, 2 Cowen, 675, 676; Same v. Ely, ib. 699; Salem Mill Dam Corporation v. Ropes, 6 Pick. 32; 3 Barnwell & Alderson, 216; McIntyre v. Preston, decided at this term; Phillips on Ins. 205, 206.

4. A final decree in equity, or an interlocutory decree deciding the merits, can not be pronounced until the parties to the bill and in interest are before the court. Marshall v. Beverly, 4 Peters' Cond. R. 660; Conn. v. Penn. ib. 718; Dodge v. Griswold, 8 N. H. 427; Seagrave v. Edwards, 3 Vesey, 372; Gibson v. Wright, 3 Munf. 94; Shields v. Craig, 1 Monroe, 72.

5. An interlocutory decree for the payment of a sum of money should be for a sum certain. Wernwag v. Brown, 3 Blackf. 458; Downing v. Palmater, 1 Monroe, 66; 2 Barb. & Har. Eq. Dig. 289, § 4.

6. A decree pro confesso is like a default at law. Murphy v. American Life Ins. Co. 25 Wend. 250; Dunn v. Keegin, 3 Scam. 297; Clason v. Morris, 10 Johns. 538; Millspaugh v. McBride, 7 Paige, 509.

7. At the time of the rendition of the decree in this case, the charter of the Bank of Illinois was repealed; the bank went out of existence, March 5th, 1847. Laws of Ills. 1842-3, page 33, § 7. The decree was not rendered until May, 1847. The counsel of plaintiff in error insist that a decree could not be rendered in favor of a corporation not in existence, and the objection can be taken in this court, as the law repealing the charter of the bank was a public law.

D. A. SMITH, for the defendants in error.

The Opinion of the Court was delivered by TRUMBULL, J.

The defendants in error, who were complainants in the court below, filed their bill against the plaintiffs in error and John Shaw for the purpose of setting aside as fraudulent, various conveyances by which Frye claimed certain real estate which Shaw had mortgaged to the complainants, and to subject the same to the payment of the amounts due complainants upon their said mortgages, alleging the insolvency of Shaw, etc.

The bill was taken pro confesso against Frye at the return term of the process, and a decree entered, “that unless he pay the amounts due the complainants respectively on their mortgages and notes set forth in their bill, on or before the first day of the next term of this court, that he be foreclosed of and from all equity of redemption of, and to said mortgaged premises.”

Shaw, at the time of the entry of this decree, had not been brought into court, but shortly after and before the next term he filed his answer admitting, substantially, the allegations of the bill. Frye appeared at the next term and made application to file his answer, accompanied with affidavits in support of his motion to set aside the decree pro confesso of the previous term, but the court denied the motion and entered a final decree setting forth that Frye had failed to comply with the interlocutory decree passed against him, setting aside the various conveyances to Frye, and directing the mortgaged premises to be sold to satisfy the complainants respectively, in case the defendant Shaw did not discharge said indebtedness within five days from the entry of the decree.

Frye alone brings the cause to this court, and has assigned numerous errors for the reversal of the decree.

The first which we deem it essential to notice is, that there is no allegation in the bill that the insurance companies suing as complainants were incorporated, or that they had any authority to maintain suits, or to take the notes and mortgage which constitute the foundation of their claims.

The Union and Missouri Insurance Companies having sued as corporations, no other allegation that they were incorporated was necessary (4 Blackf. 267), and the plaintiff in error having suffered the bill to be taken as confessed against him, has thereby admitted that the said companies were incorporated, and also their capacity to sue. But although the right of a corporation to maintain suits and to exercise such other powers as are necessary and essential to its existence, and to carry out the objects of its creation will be presumed, unless denied or put in issue, yet when chartered companies seek to enforce in equity, rights which do not ordinarily and necessarily belong to such corporations, it becomes necessary that they set forth and prove their authority to do the particular thing. McIntire v. Preston (10 Ill. 48).

The bill alleges that John Shaw “executed to the Union Insurance Company his note for $1500, to the Missouri Insurance Company his note for $1500, the notes to said insurance companies being given for money borrowed of them by said Shaw,” which were secured by mortgages, etc., but it contains no allegation of the power of said insurance companies under their charter to loan money upon mortgage security or...