Green v. Ashland Sixty-Third State Bank

• Decision Date: 04 December 1931
• Docket Number: No. 20769.,20769.
• Citation: Green v. Ashland Sixty-Third State Bank , 346 Ill. 174, 178 N.E. 468 (Ill. 1931)
• Parties: GREEN v. ASHLAND SIXTY-THIRD STATE BANK.
• Court: Illinois Supreme Court

346 Ill. 174

178 N.E. 468

GREEN

v.ASHLAND SIXTY-THIRD STATE BANK.

No. 20769.

Supreme Court of Illinois.

Oct. 23, 1931.

As Modified on Denial of Rehearing Dec. 4, 1931.

Error to First Branch Appellate Court, First District, on Appeal from Superior Court, Cook County; R. R. Fowler, Judge.

Suit by Henry I. Green against the Ashland Sixty-Third State Bank. To review a judgment of the Appellate Court reversing judgment of superior court for plaintiff, he brings certiorari.

Judgment of Appellate Court reversed, and judgment of superior court affirmed.Kirkland, Fleming, Green & Martin, of Chicago, and Oris Barth, of Urbana (Joseph B. Fleming, Jay Fred Reeve, and Joseph H. Pleck, all of Chicago, of counsel), for plaintiff in error.

Deneen, Healy & Lee, of Chicago (Harry W. Lippincott and Donald N. Schaffer, both of Chicago, of counsel), for defendant in error.

HEARD, J.

This cause is here on certiorari to the Appellate Court for the First District on petition of Henry I. Green, plaintiff in error, against the Ashland Sixty-Third State Bank, defendant in error. The plaintiff in error will be designated hereafter as petitioner, and the defendant in error as respondent.

Petitioner commenced a suit in the superior court of Cook county against respondent based on a contract in writing as follows:

‘To E. A. Curtis, Pres. Ashland & 63rd

‘State Bank, Chicago

‘Please credit acct. of Grant Park State State Bank with $25,000 per deposit of U. S. bonds mentioned below. 10/13/25.

‘Andrew Russel.

‘Chicago, Illinois, October, 13, 1925.

‘This is to certify per instructions above that Andrew Russel has this day deposited with the Ashland & 63rd State Bank, of Chicago, Illinois, twenty-five thousand ($25,000) dollars principal amount of bonds of the United States of America, bearing interest at three and one-half per cent (3 1/2%) per annum as evidenced by interest coupons thereto attached; that pursuant to said deposit credit has been given in said bank to the amount of $25,000 to the account of the Grant Park State Bank of Grant Park, Illinois, which said credit is to remain and be maintained accordingly for a period of seven (7) months from this date, unless during said period said bonds are withdrawn as hereinafter provided.

‘It is understood and the undersigned therefore hereby agrees that if at any time within the period of seven (7) months from this date said Andrew Russel or the assignee of his rights hereunder shall so request, then in such event the said United States government bonds, with the coupons thereto attached, shall be promptly returned and delivered to the said Andrew Russel, or to such person, persons or corporation as the said Andrew Russel may designate, and the principal amount thereof charged against the account of the said Grant Park State Bank of Grant Park, Illinois; and any assignment or transfer by the said Andrew Russel of his rights or interests hereunder or in the property aforesaid, shall operate and be construed as a designation by him of the person, persons or corporation to whom such assignment or transfer shall have been made.

‘Ashland Sixty-Third State Bank,

‘By E. A. Curtis, President.’

The declaration consisted of counts on this contract, in which was alleged, among other things, that on October 15, 1925, Russel assigned to petitioner all his right, title, and interest in the bonds mentioned in the contract and designated petitioner as the person entitled to demand and receive the bonds deposited with respondent; that demand was made on respondent therefor on April 26, 1926; and that it refused to deliver the same, with resultant liability to petitioner therefrom. The declaration also contained the common counts. An affidavit of claim made by petitioner's agent was filed with the declaration, which was later supplemented by an affidavit of petitioner. Respondent filed pleas of the general issue that the promise in the contract was beyond the corporate powers of respondent, was ultra vires, and void; that E. A. Curtis had no authority to enter into the contract on behalf of respondent; that the promise was without consideration; that the promise in the declaration mentioned and the deposit of the $25,000 of Liberty bonds, upon consideration of the respondent extending and giving credit to the Grant Park State Bank, which credit was to remain and be maintained for a period of seven months from the date of the agreement, was done solely for the purpose of establishing and maintaining a fictitious credit to bolster up the credit standing of the Grant Park State Bank and to make it appear that said bank had a credit with respondent to the extent of $25,000, whereas in truth and reality no such actual credit existed, and that the Liberty bonds of the alleged value of $25,00 mentioned in the declaration were deposited by Andrew Russel in consideration of respondent extending credit to the Grant Park State Bank in the amount of $25,000; that in consideration of the deposit by Russel, respondent did extend credit in the sum of $25,000 to the Grant Park State Bank, which credit was used and exhausted by said bank, no part of which has ever been replenished or returned to respondent by said bank; and that the credit of $25,000 was used and exhausted by said bank prior to any demand being made by Russel or his assignee, or any one else, for the return of the bonds.

A jury trial resulted in a judgment based on a directed verdict for petitioner for $29,326.46, against respondent. Respondent appealed to the Appellate Court for the First District, which reversed the judgment of the superior court without remanding and made a finding of fact, finding, among other things, ‘that defendant bank accepted said deposit and made said credit as directed, and that said credit was used by the Grant Park State Bank and has not been re-paid; that under the terms of the agreement the bonds were to be returned to plaintiff's assignor, or his assignee, upon the contingency that said credit was not used or was re-paid; that said contingency has not occurred; that plaintiff has not alleged in his declaration that he, as assignee, is the owner in good faith of the cause of action or verified his declaration, as required by section 18 of the Practice act, and for that reason also he may not maintain this suit.’

Respondent urges that the contract in question was without consideration and therefore void. While it is true that a contract, to be binding, must be based upon a consideration, the rule is well settled that any act which is of benefit to one party or a disadvantage to the other constitutes a sufficient consideration to support a contract. Anderson v. Bills, 335 Ill. 524, 167 N. E. 864;Buchanan v. International Bank, 78 Ill. 500;Burch v. Hubbard, 48 Ill. 164. The deposit of the bonds with respondent was a sufficient consideration for the promise contained in the contract.

Without passing upon petitioner's claim that the affidavit of his agent and petitioner's supplemental affidavit were a sufficient compliance with section 18 of the Practice Act (Smith-Hurd Rev. St. 1929, c. 110, § 18) if such compliance were required, suffice it to say that respondent by its contract agreed that at any time within seven months upon the request of Russel or the assignee of Russel's right under the contract, it would promptly return and deliver the bonds and attached coupons to Russel or to such person as Russel might designate, and that any assignment or transfer of Russel's right should operate and be construed as a designation by him of the person to whom such assignment was made; that prior to the commencement of the suit, and within seven months of the execution of the contract, Russel assigned all his interest to petitioner and designated him as the person entitled to receive the bonds; that petitioner accepted the assignmentand that respondent had notice thereof; that petitioner demanded the delivery of the bonds and that respondent refused delivery; and that therefore respondent's resultant liability, if any, was a direct contractual liability to petitioner, to which section 18 of the Practice Act has no application. It has been settled by repeated decisions of this court that in case of simple contracts the person for whose benefit a promise is made may maintain an action in his own name upon it although the consideration does not move from him. Lawrence v. Oglesby, 178 Ill. 122, 52 N. E. 945;Commercial Nat. Bank v. Kirkwood, 172 Ill. 563, 50 N. E. 219;Snell v. Ives, 85 Ill. 279;Steele v. Clark, 77 Ill. 471;Eddy v. Roberts, 17 Ill. 505;Chicago Title & Trust Co. v. Central Trust Co., 312 Ill. 396, 144 N. E. 165.

Section 1 of the Banking Act (Smith-Hurd Rev. St. 1929, c. 16 1/2, § 1), provides that banks may be organized to receive deposits, loan money and do a general banking business. Banks are authorized to receive special as well as general deposits, and when such special deposits are received the bank is bound to carry out the terms of the deposit for a special purpose. Where a deposit is made in a bank and the identical property deposited is to be returned to the depositor and not the equivalent thereof, the deposit will be special and the bank will have no authority to use the money in its business, and it is its duty to safely keep and return the identical deposit to the depositor. People v. Farmers State & Savings Bank, 338 Ill. 134, 170 N. E. 236;American Exchange Bank v. Loretta Gold & Silver Mining Co., 165 Ill. 103, 46 N. E. 202,56 Am. St. Rep. 233;Mutual Accident Ass'n v. Jacobs, 141 Ill. 261, 31 N. E. 414,16 L. R. A. 516, 33 Am. St....