Loeb v. Stern

• Decision Date: 25 October 1902
• Parties: LOEB et al. v. STERN.
• Court: Illinois Supreme Court

198 Ill. 371

64 N.E. 1043

LOEB et al.

v.STERN.

Supreme Court of Illinois.

Oct. 25, 1902.

Appeal from appellate court, First district.

Action by Fredericka Stern, as administratrix of Marcus Stern, deceased, against Sidney Loeb and another. From a judgment of the appellate court (99 Ill. App. 637) affirming a judgment of the superior court in favor of plaintiff, defendants appeal. Affirmed.

This is an action of assumpsit, brought on January 6, 1898, in the circuit court of Cook county by the appellee, Fredericka Stern, administratrix with the will annexed of the estate of Marcus Stern, deceased, against the appellants, Sidney Loeb and August Gatzert, partners under the firm name of Loeb & Gatzert, upon the contract hereinafter mentioned. A general and special demurrer was filed to the original declaration, and sustained. Thereupon, on April 28, 1898, appellee filed an amended declaration, consisting of two counts, the substance of which is hereinafter stated. The appellants filed a plea of general issue, and, by leave of court, certain additional pleas. The additional pleas were demurred to, and the demurrers thereto were sustained, so that the case was tried upon the issue made upon the amended declaration and the plea of the general issue thereto. At the close of appellee's evidence, appellants moved the court, in writing, to exclude the plaintiff's evidence from the jury, and to instruct the jury to find the issues for the appellants, tendering an instruction in writing to that effect; but the court overruled the motion and refused to give the instruction, to both of which rulings defendants below excepted. Thereupon appellants introduced their evidence. Counsel for the defendants below submitted to the court and asked the court to give 12 instructions, but all of said instructions were refused by the court, and exception was taken to such refusal. No instructions were asked on behalf of plaintiff below. At the close of the evidence the court instructed the jury in writing as follows: ‘The court instructs the jury in this case to render a verdict in favor of the plaintiff, and to assess the damages in the sum of $1,022.73,’ to which counsel for appellants excepted. Thereupon, the jury returned a verdict in accordance with the instruction of the court, and, after overruling motions for new trial and in arrest of judgment, the court rendered judgment upon the verdict. An appeal was taken to the appellate court, where the judgment of the circuit court has been affirmed. The present appeal is prosecuted from such judgment of affirmance.

The facts are substantially as follows:

On February 20, 1893, one G. D. Glaser, acting for Marcus Stern, of Philadelphia, Pa., purchased from appellants, as copartners under the firm name of Loeb & Gatzert, a principal note and certain interest notes, and a trust deed securing the same, upon real estate in Cook county, executed by F. D. and C. D. Hess. The principal note was dated November 28, 1892, signed by Frederick D. and Caroline D. Hess, of Chicago, and was for the sum of $6,500, payable to their own order five years after date, with interest at 6 per cent., payable semiannually, and by them indorsed and made payable to the order of Marcus Stern. At the same time, 10 interest notes, of the same date, each for the sum of $195, were executed and indorsed in the same manner, payable, respectively, on the 28th day of May and the 28th day of November in each of the years from 1893 to 1897, inclusive. The trust deed securing these notes was executed to the appellant August Gatzert, as trustee.

At the time the notes and mortgage were so sold, and as a part of the consideration of the purchase, the following contract was executed by appellants and delivered to Stern, to wit: ‘Chicago, Feb. 20, 1893. Mr. Marcus Stern, No. 943 N. Eighth St., Philadephia, Pa.-Dear Sir: We herewith hand you first mortgage of F. D. and C. D. Hess, dated November 28, 1892, for the amount of $6,500.00, which, with accrued interest to date, amounts to $6,588.69, for which we received check from Mr. G. D. Glaser, of this city, on your account. We hereby guaranty that the trust deed securing the payment of principal and interest notes, which we hand you herewith, is a first lien upon the property covered in said deed, and that the title to said property is good in said F. D. and C. D. Hess, and agree to protect you from any loss which might arise from any defect in said title. We also guaranty you the completion, free from all mechanics' liens, of the four-story stone-front store and flat building which is now in process of completion upon said premises, and which is known as No. 6504 State street. We will also see to it that the taxes are paid on said property during the term of loan, and that the building will remain insured for an amount of no less than $6,500.00 during said time, which insurance policies we will hold as collateral security of the loan for your benefit. We also hold abstract of title, and agree, furthermore, to take this mortgage back at par and accrued interest, less one per cent. commission, provided you give us thirty days' notice to such effect, in writing. Very respectfully yours, Loeb & Gatzert.’ More than three years later, on August 10, 1896, a default then existing in the payment of the interest which fell due on May 28, 1896, Marcus Stern caused to be served upon appellants the following notice, to wit: ‘Atlantic City, N. J., 8/7/96. Mess. Loeb & Gatzert, Chicago, Ill.-Gentlemen: In accordance with the provision in that respect contained in your writing of February 20, 1893, wherein you agree to take back the note of $6,500.00, and trust deed of Frederick D. and Caroline D. Hess, at par and accrued interest, less one per cent. commission, I do hereby give notice that I desire to avail myself of the benefits of said provision, and do hereby notify you to take back said note and trust deed in accordance with the terms of said provision, thirty days after receipt of this notice by you; and I hereby authorize G. D. Glaser to receive the amount of said note and interest, less commission, for me. Truly yours, Marcus Stern.’ Appellant Gatzert testified that the following conversation took place at the time of the service of said notice by Glaser: ‘I told him that we would not buy it back, because at the time he bought this mortgage I told him I would make this agreement simply because his father-in-law was coming to the World's Fair in 1893, and he wanted to look at the property then, and if it didn't suit him I would then take the mortgage back,-we would take the mortgage back. For that reason there was an understanding in the nature of our agreement, and I told him we were not compelled to take back that mortgage. Mr. Glaser said: ‘Well, I simply serve you with this notice.’ That is all he said. He said: ‘I have nothing to say. I serve you with this notice.’' Appellant Loeb testified as follows: ‘I remember the conversation with Glaser which Mr. Gatzert had that time. He came in and presented that letter from Mr. Stern, and said that he wanted his money. I was present, and we were very much surprised to see him come in, after owning the mortgage for three years. We told him that that wasn't the intent of that letter; that he told us at the time he bought the mortgage that he would not ask it of us, but that he was buying it for his father-in-law [Stern]; that his father-in-law would be here during the World's Fair, and he would take him out and show him the property; and we agreed to take it back if his father-in-law did not like it at the time. Instead of that, he keeps the mortgage for three years. We told him that we would not buy it back. He said that he would see about it, and went out of the office. He wanted his money. That is all he said.’ After the service of this notice, and the conversations above detailed, Glaser took the notes and trust deed to Mr. Strauss, an attorney, with instructions to proceed to foreclose it.

No demand was made upon Loeb & Gatzert on or after the expiration of the 30 days provided in the above notice. Subsequently, on September 23, 1896, Marcus Stern died, and appellee was appointed administratrix with the will annexed of his estate. On or about January 22, 1897, appellee, as such administratrix, filed a bill to foreclose the trust deed in question; the makers thereof being in default in the payment of interest. No notice was given to appellants of the filing of this bill; but appellant Gatzert, who was the trustee in the trust deed, was made a party defendant to the foreclosure proceeding. Appellant Loeb, of the firm of Loeb & Gatzert, was not made a party defendant. Appellant Gatzert appeared and filed his answer in the foreclosure suit on March 9, 1897, and afterwards a decree of sale was entered. The property was bid in on behalf of appellee, and on June 30, 1897, a deficiency decree was entered against the mortgagors and in favor of appellee for $1,089.67. Execution was duly issued on July 13, 1897, and was given to the sheriff to execute on the same day. On October 11, 1897, the sheriff returned the writ, ‘No property found;’ having made demand upon both execution debtors, left with them a copy of the writ, and notified them to file a schedule. The sheriff returned, ‘No schedule filed.’ No part of the deficiency decree has been collected. Appellee commenced the present suit against the appellants, upon the contract already set out, to recover the amount of the deficiency decree, less 1 per cent. of the amount of the notes aforesaid. Appellants defended upon the following grounds: (1) That no time being mentioned in the original agreement wherein the security might be returned, such security should have been returned within a reasonable time, and that three years after the making of the contract was not a reasonable time; (2) that no demand upon the appellants, or tender of the securities, was ever made on or after...