Illinois Merchants' Trust Co. v. Harvey

• Decision Date: 19 June 1929
• Docket Number: No. 19230.,19230.
• Citation: 335 Ill. 284,167 N.E. 69
• Parties: ILLINOIS MERCHANTS' TRUST CO. et al. v. HARVEY.
• Court: Illinois Supreme Court

335 Ill. 284

167 N.E. 69

ILLINOIS MERCHANTS' TRUST CO. et al.

v.HARVEY.

No. 19230.

Supreme Court of Illinois.

June 19, 1929.

Error to Third Branch Appellate Court, First District, on Appeal from Superior Court, Cook County; Hosea W. Wells, Judge.

Suit by the Illinois Merchants' Trust Company and others against Bertha F. B. Harvey. Judgment for defendant by the superior court was reversed by the Appellate Court, and judgment entered for plaintiffs, and defendant brings certiorari.

Reversed, and judgment of superior court affirmed.Mayer, Meyer, Austrian & Platt, of Chicago, for plaintiff in error.

Wilson, McIlvaine, Hale & Templeton, of Chicago (William B. Hale, J. F. Dammann, Jr., and Calvin Selfridge, all of Chicago, of counsel), for defendants in error.

PER CURIAM.

An opinion in this cause was filed at the February term, 1929. A petition for rehearing was filed and allowed. Upon further consideration, the court adheres to the conclusions reached in that opinion, and it is readopted and refiled.

STONE, J.

Defendants in error, as trustees of the residuary estate of Marshall Field, deceased, filed a suit in assumpsit in the superior court of Cook county against plaintiff in error to recover the sum of $8,350.97 theretofore paid by them to her. This sum had been paid on the demand of plaintiff in error that she be reimbursed for income taxes which she had paid for a number of years on rentals received from defendants in error as tenants. The demand for such payment was based on a clause in a lease between the parties. The lease was originally between plaintiff in error and others as lessors and Marshall Field as lessee. Plaintiff in error later acquired the interests of the other lessors, and the suit is against her only. Plaintiff in error is hereinafter also designated as lessor and defendants in error as lessees.

The ground of recovery as set out in a special count of the declaration is that the payment was made under duress. Under article 3 of the lease between the parties, the lessees were to pay all taxes, water rates, special assessments, and all other similar impositions of every kind which should be levied or imposed upon the premises described in the lease. On March 9, 1921, the lessor demanded that the lessees pay to her the income taxes levied against and collected from her by the United States government upon rents which she had received from the lessees for the years 1916 to 1919, inclusive. The lessees denied that they were liable to pay such taxes. Article 2 of the lease provided that, in case default on the part of the lessees shall continue 60 days after written notice thereof, the leasehold estate should be forfeited, and the lessees should surrender the building on the land without compensation being paid therefor by the lessor. On March 9, 1921, the lessor served on the lessees a notice stating that they income taxes, and that they had not paid such income taxes, and that, unless the default was made good within 60 days after the service of such notice, the lessor would exercise her election to declare the lease terminated and avail herself of the rights reserved therein. These are averments of the declaration. There is also therein averred the erection of a building by the lessees and the leasing thereof to Marshall Field & Co. This leasehold is alleged to be of the value of $2,000,000. It is complained that a forfeiture of the lease would have caused a loss to the lessees of the entire leasehold; that neither the amount ($8,350.97) demanded by the lessor, nor any other amount, was due from the lessees, but, owing to the lessor's threat of forfeiture and fear of possible loss of the leasehold eatate, with the building thereon, the lessees were under compulsion and duress by the lessor, and paid the sum demanded to prevent forfeiture of the lease. The lessor filed the general issue and a plea denying that payment was made under protest or on account of threats, compulsion, or duress, but that the facts on which the claim was based and on which a settlement was had were fully known to the lessees and payment was made in satisfaction thereof. A plea of accord and satisfaction and one of the statute of limitations were also filed.

The facts are substantially without dispute. The lease was executed in 1904 between plaintiff in error and others as lessors, and Marshall Field, now deceased, as lessee, by which certain real estate on Wabash avenue, in the city of Chicago, on which a part of the retail store of Marshall Field & Co. now stands, was leased to Field. The lease was later extended, under an option therein contained, to 1980. It required the lessee to erect a building not less than eight stories in height. Defendants in error paid the income tax on the rental paid for the years 1914 and 1915, but, by reason of an amendment to the Income Tax Law, they refused to pay such tax for the years 1916 to 1919, inclusive, in the belief that they did not owe such tax.

The notice of forfeiture, in substance, stated that the lessees were in default in performance of the covenants of the lease by reason of failure to pay the tax levied by the United States government upon the rents paid by the lessees to the lessor under the terms of the lease for the years 1916 to 1919, inclusive, and contains the following language: ‘And you are notified hereby that unless you make good your default in the performance of the covenants and agreements in said lease contained on the part of the lessee to be performed as to the rentals herein mentioned, within sixty days after this notice has been given to you, the lessors will exercise their election to declare the term of said lease ended and avail themselves of the rights reserved in said lease upon the termination thereof.’ On May 6, 1921, counsel for defendants in error paid plaintiff in error the sum of $8,350.97, which included also the tax for 1920, $1,450 attorney's fee, and $100 accountant's fee. At the time this payment was made, or prior thereto, counsel for defendants in error protested that they did not owe that amount, or any amount, to plaintiff in error, but that they could not afford to litigate the question in any suit involving the possible forfeiture of the lease. At the October term, 1923, this court in Young v. Illinois Athletic Club, 310 Ill. 75, 141 N. E. 369, 30 A. L. R. 985, decided that a lessee under a lease similar to the one here involved was not required to pay the lessor's income taxes on rent received. Thereafter defendants in error filed this suit. The cause was tried before a jury. At the close of all the evidence, the court directed a verdict for plaintiff in error, and judgment was entered thereon. On appeal to the Appellate Court, this judgment was reversed, and a judgment entered in that court in favor of defendants in error for $11,269, including the full amount paid, plus interest at 5 per cent. per annum. The cause comes here on certiorari.

Plaintiff in error contends, first, that the payments were not made under compulsion or duress, but voluntarily under a mistake of law; and, second, that, if the verdict should not have been directed for defendants in error by the trial court, it was a question of fact for the jury whether payment was made under compulsion or duress.

Concerning the first assignment, counsel argue that such payment was not made under duress, but was, at most, a payment made in mistake or ignorance of law, as to which question defendants in error could have had their day in court either by bringing a bill in equity to restrain the threatened forfeiture or by defending a suit brought for possession,and, having failed to resort to such remedy, the payment is voluntary and not compulsory.

[1][2] The authorities agree, and it is agreed in the briefs, that a payment made under compulsion or duress may be recovered. The application of this rule of law has not at all times been uniform. At the common law duress meant duress only of person, and nothing short of a reasonable apprehension of imminent danger to life, limb, or liberty sufficed as a basis for an action to recover money paid. The doctrine became gradually extended, however, to recognize duress of property as a sort of moral duress, which, equally with duress of person, entitled one to recover money paid under its influence. Today the ancient doctrine of duress of person (later of goods) has been relaxed, and extended so as to admit of compulsion of business and circumstances. Illinois Glass Co. v. Chicago Telephone Co., 234 Ill. 535, 85 N. E. 200,18 L. R. A. (N. S.) 124.

[3] Compulsory payment is primarily a question of fact. No precise rules can be laid down as to what will constitute a compulsory payment, though the principle has been illustrated by a number of cases in this and other courts. In Bradford v. City of Chicago, 25 Ill. 349, a property owner refused to pay a void assessment. A demand was made on him by a collector who had in his hands a warrant authorizing him to levy on and sell the goods and chattels of the property owner. It was considered that no opportunity was afforded him to save himself and property in any other way than by paying the illegal demand, and, such payment being protested, was deemed to have been made under duress and could be recovered. So in County of La Salle v. Simmons, 5 Gilman, 513, where a ferryman was required to pay an excessive and illegal charge for the renewal of his license, it was found that he was in the power of the county commissioners, from which power he had no way to extricate himself and was thus compelled to pay the money, and could therefore recover it. In Spaids v. Barrett, 57 Ill. 289, 11 Am. Rep. 10, the owner of a shipment of oysters which had been seized on illegalattachment was permitted to pay the amount demanded and recover it on the ground that the payment was under duress. The oysters were in danger of spoiling, and it was considered that, even though he had recourse to...