Jackson v. Norris

• Decision Date: 30 June 1874
• Citation: 1874 WL 8825,72 Ill. 364
• Parties: JAMES S. JACKSON, State's Attorney, ex rel.v.WILLIAM NORRIS et al.
• Court: Illinois Supreme Court

72 Ill. 364

1874 WL 8825 (Ill.)

JAMES S. JACKSON, State's Attorney, ex rel.

v.WILLIAM NORRIS et al.

Supreme Court of Illinois.

June Term, 1874.

APPEAL from the Circuit Court of Marion county; the Hon. AMOS WATTS, Judge, presiding.

Mr. HENRY C. GOODNOW, for the appellant.

Mr. M. SCHÆFFER, and Mr. W. W. WILLARD, for the appellees. Mr. JUSTICE SHELDON delivered the opinion of the Court:

This was a bill in chancery, filed by James S. Jackson, State's Attorney in and for the county of Marion, in this State, on the relation of Levi Fellenbaum, on behalf of himself and all others, inhabitants of Salem, in said county, having taxable property within the corporate limits of said city of Salem.

The substance of the case made by the bill is, that on the third day of February, 1873, at a meeting of the city council, the mayor and aldermen of the city of Salem appropriated and donated to the Salem Manufacturing Company the sum of $1000, and ordered the same to be paid to the said company on the first day of June, 1873, to enable the company to pay off and discharge its debts, and ordered the mayor and clerk of the city to draw an order on its treasurer for such sum, so payable; that the order was accordingly issued and delivered to the company for such purpose, and afterward the manufacturing company transferred and delivered the order to the Salem National Bank, to which the company was largely indebted; that at the time the bank received the order, it well knew that the said appropriation and donation so made by the mayor and aldermen were made to the Salem Manufacturing Company for the purpose of enabling it to pay its indebtedness to the bank; that the mayor and aldermen, learning steps were about to be taken to enjoin the payment of the order, instructed the treasurer of the city to pay it before the first day of June, 1873, to-wit: about the first day of May, 1873, to prevent such injunction; and that before legal proceedings could be commenced to enjoin the payment, the treasurer paid the said sum of $1000 to the bank, out of moneys in the treasury of the city which had been raised by taxation and from licenses.

The bill was filed against the bank, the manufacturing company, the mayor and aldermen, the city of Salem and its treasurer, asking to have the money restored to the city treasury, and that the treasurer be enjoined from paying the money, when paid into the treasury, out again on such appropriation. Demurrers were filed to the bill and sustained, and the bill dismissed. The complainants bring the case here by appeal.

The only objections taken to the bill are, that equity has no jurisdiction in such a case, and that if there is any right to relief growing out of the facts, it is in the city of Salem against the Salem National Bank, and not in the State's Attorney or the relator.

There is no pretense that there was any legal authority to make this donation of $1000 to the Salem Manufacturing Company. It was an evident misappropriation of corporate funds.

The court of chancery will interfere to prevent municipal councils from abusing powers relating to property and funds intrusted to them, to be exercised in conformity with law, for the benefit of the incorporated place or its inhabitants, and will relieve against fraudulent dispositions of corporate property, it being held that the powers conferred upon such corporation officers, in respect to the corporate property, are public trusts, and the property owned by the corporations is held by them in trust; and, hence, if these powers are abused, as, if corporate property is...