Laughlin v. Hopkinson

• Decision Date: 09 April 1920
• Docket Number: No. 13018.,13018.
• Citation: 292 Ill. 80,126 N.E. 591
• Parties: LAUGHLIN v. HOPKINSON.
• Court: Illinois Supreme Court

292 Ill. 80

126 N.E. 591

LAUGHLIN

v.HOPKINSON.

No. 13018.

Supreme Court of Illinois.

Feb. 18, 1920.

Rehearing Denied April 9, 1920.

Error to Appellate Court, First District, on Appeal from Circuit Court, Cook County; S. C. Stough, Judge.

Action by Joseph M. Laughlin against William M. Hopkinson. Judgment for plaintiff was affirmed on appeal to the Appellate Court, and defendant brings certiorari.

Reversed and remanded.Charles B. Stafford and Cooke, Sullivan & Ricks, all of Chicago (George A. Cooke, of Chicago, of counsel), for plaintiff in error.

Lewis F. Jacobson, of Chicago (David F. Rosenthal, of Chicago, of counsel), for defendant in error.

THOMPSON, J.

Plaintiff in error, William M. Hopkinson, for several years before the occurrence of the transaction out of which this litigation grows, was traveling salesman for a wholesale clothing house. His territory included Emmetsburg, Iowa, and it was there that he met defendant in error, Joseph M. Laughlin. Laughlin was a partner in a retail clothing store in Emmetsburg and was a customer of Hopkinson. On his June, 1908, trip to Emmetsburg, Hopkinson; after selling a bill of goods to Drybread & Laughlin, showed them a picture of a retail clothing store which he owned at Toledo, Ohio. He represented it to be one of the finest retail clothing stores west of New York, and that by a special method of selling goods he was getting profits of 100 per cent. and had made $3,000 in the four months of spring trade. A few days after this conversation, June 13, 1908, Hopkinson wrote Laughlin that his store was making him lots of money; that he had made $300 net profits the week before; that the people he had working for him were not to be trusted; and that he was looking for some trustworthy person to buy an interest in the business. Up to this time nothing had been said about Laughlin buying the store. Laughlin answered this letter immediately, stating, among other things, ‘I have been crazy thinking about your shop ever since you left here.’ As a result of this and other correspondence, Laughlin went to Toledo, where he was met by Hopkinson. He was taken to the store and there met Drohen and De Witt, then clerks in Hopkinson's employ but formerly the owners of the business. Hopkinson represented to Laughlin that one or both of these men were stealing from him and that he did not want them to know that Laughlin was considering buying the store. Laughlin was shown through the store and around the town of Toledo. Among other things he saw in the store was a day sales book kept by Drohen, which showed daily sales varying in amounts from $70.25 to $533.90. Laughlin went back to Emmetsburg, and, after discussing the matter with his partner and his family, determined to buy a half interest in the store. He returned to Toledo the early part of July and was again shown the sales book, which indicated daily sales for the first five days of July, 1908, varying in amounts from $111.50 to $754.80. An invoice was made by Hopkinson and Laughlin of the merchandise and fixtures of the store, showing the total to be $12,346.34. In this invoice was included an item for fixtures of $5,660.61. On July 10, 1908, Laughlin paid $6,173.17 for a half interest in the store and immediately took charge of the store and managed it for the remainder of the year. A corporation was formed soon after Laughlin purchased a half interest in this business. Some six weeks after Laughlin had been in full charge and control of the store, his brother, with Laughlin's knowledge and approval, bought part of Hopkinson's stock, paying Hopkinson $75 a share for stock of the par value of $50. September 22, 1908, Laughlin in a letter to Hopkinson said, among other things, ‘I would not sell my half interest in the business for anything,’ and on October 13th wrote, ‘This place is worth $30,000 to-night.’ Friction arose between Laughlin and his brother, and Laughlin had some correspondence with Hopkinson regarding the purchase of the brother's stock for the purpose of getting the brother out of the business. On December 2d Laughlin wrote, among other things:

‘For heaven's sake take Lou's stock off his hands. I hate to say it about my own brother, but you know that Lou's place is not in a clothes shop, and especially with me. Now, I do not want to get out myself, as we have the only location in the country.’

Business was poor and Laughlin became discouraged. The daily sales subsequent to July 10th (the time when Laughlin took charge of the business) varied in amounts from $8.50 to $277. About the first of December Laughlin discovered that the fixtures had not cost $5,660.61 as invoiced, but had cost only $1,404. Matters went from bad to worse, and after several conferences between the parties Laughlin disposed of the fixtures and the merchandise and deposited the $1,900, which then represented the total assets of the company, in a bank at Emmetsburg to the credit of the company. Laughlin brought this action for fraud and deceit against Hopkinson and recovered a judgment against Hopkinson for $15,000, which, on appeal to the Appellate Court for the First District, was affirmed. Pursuant to a writ of certiorari granted by this court, this cause is brought here to review the judgment of the Appellate Court.

The facts in this case are much in dispute, and the evidence on practically all material matters is contradictory. Laughlin claims that the false representations were even more aggravated than we have set them out above, while Hopkinson contends that many of the representations set out above were not made at all. For instance, Laughlin testifies that Hopkinson showed him the record of daily sales and represented them to be authentic, while Hopkinson denies any knowledge of the sales book and testifies that it was kept by Drohen, and that if the statements in the daily sales book were not true he was not responsible for their falsity. The evidence on practically all the material questions being contradictory, the issues were properly submitted to the jury. We are not authorized to review or to determine contested questions of fact. The judgment of the Appellate Court as to these questions must necessarily be taken as conclusive upon this court, and will be so regarded in our consideration and discussion of the questions of law arising upon the record.

Several questions are presented with respect to the action of the trial court in the admission and exclusion of evidence. The only question on the admission and exclusion of evidence that requires attention here is regarding the admission in evidence of a copy of a letter from Drohen to De Witt. When Laughlin took charge of the store, he took Drohen's place therein, but kept De Witt as an employé. In a letter written December 3, 1908, Drohen said to De Witt:

‘Received your letter and am not surprised that Joe is getting wise, but I don't think that he will have anything on you or me. The only thing to do is to keep quiet and not tell them anything under any circumstances, as it will not do to make yourself liable. If they ask you any questions, tell them that the business was all O. K. when you and I were there, which it was.’

The original letter was excluded by the court when it was offered, but a copy which Laughlin obtained from De Witt was admitted on the ground that Laughlin showed the copy to Hopkinson and told Hopkinson how he got possession of it, and that in this conversation Hopkinson stated that he would take the store off Laughlin's hands.

We are unable to see any theory upon which this letter or the copy was admissible. It does not tend in any way to prove the issues in the case, and the fact that it impliedly charged Hopkinson with fraud made its admission especially objectionable.

It is urged that the court erred in giving to the jury plaintiff's second and sixth instructions, in which the jury were told, in substance, that if the defendant made the representationsalleged in the declaration, that such representations were material, that they were false, and that they induced the plaintiff to purchase, then the verdict should be for the plaintiff. The objection is that the jury were left to determine: First, what representations were alleged in the declaration; and, second, what representations so alleged were material. The instructions are subject to the criticisms made. What were the material allegations of the declaration was a question of law, and it was error to submit that question to the jury. Endsley v. Johns, 120 Ill. 469, 12 N. E. 247,60 Am. Rep. 572;Toledo, St. Louis & Kansas City Railroad Co. v. Bailey, 145 Ill. 159, 33 N. E. 1089. The proper method is for the court to inform the jury by the instructions, in a clear and concise manner, as to what material facts must be found to authorize a recovery. Where the jury are not only referred to the declaration to determine the issues but are instructed to find a verdict for the...