Marks v. Conrad Seipp Brewing Co.

• Decision Date: 29 October 1920
• Docket Number: No. 10509.,10509.
• Citation: 128 N.E. 620,74 Ind.App. 50
• Parties: MARKS et al. v. CONRAD SEIPP BREWING CO.
• Court: Indiana Appellate Court

74 Ind.App. 50

128 N.E. 620

MARKS et al.

v.CONRAD SEIPP BREWING CO.

No. 10509.

Appellate Court of Indiana, Division No. 2.

Oct. 29, 1920.

Appeal from Superior Court, Lake County; Charles E. Greenwald, Judge.

Action by the Conrad Seipp Brewing Company against Louis Marks and Clara Marks. From judgment for plaintiff, defendants appeal. Reversed, with instructions.

George P. Rose, of Gary, for appellants.

Davis & Starr, of Gary, for appellee.

NICHOLS, J.

This action was by appellee against appellants to recover upon a promissory note executed by appellants to appellee, dated April 25, 1912, the action being commenced July 11, 1917.

To the complaint, Louis Marks, appellant, filed two paragraphs of answer, the first a denial, and the second averring that on or about the 25th day of April, 1912, appellee sought to induce appellant Louis Marks to handle and retail in his saloon in Gary, Ind., the beer manufactured by appellee, and in pursuance of said inducement appellee offered to loan him $1,000 with the understanding and agreement that he was to handle and use as draught beer the product of appellee, and that if he should use and retail the appellee's beer in his saloon in Gary, Ind., and should continue to retail same and purchase same from appellee for a period of five years, then the note given and sued upon in this cause should become null and void, and noncollectible. In pursuance to said agreement, he complied fully with the same, and used said beer on draught in said saloon, and used a very great amount of same, and excluded all other draught beer for the said period of five years, and used no draught beer except that purchased from appellee, and that because of the fulfillment on his own part, of said agreement the note is fully paid and satisfied and is void.

Appellant Clara Marks answered in two paragraphs, the first a denial, and the second averring that at the time she executed the note sued upon she was the wife of appellant Louis, and executed the note as his surety.

The case was put at issue by appellee's reply in denial to each of the special paragraphs of answer, and submitted to a jury for trial, which returned a verdict for appellee in the sum of $1,504 principal, interest and attorneys fees. Appellant's motion for a new trial was overruled, and this ruling of the court is the only error assigned.

It is expressly stated by appellants that this case is to be decided upon one question only, and that is whether or not the transaction involved was illegal; and, if it is illegal, appellants contend that the court should refuse any relief to appellee.

It appears by the undisputed evidence that there was a mortgage on the property purchased by appellant for saloon purposes amounting to $625, at the time of the purchase, being the same time as the execution of the note in suit. Appellee's agent testified that he was present when the note was given. The papers were sent to him from Chicago, the release of the mortgage, a check for $375, and the note to be signed by appellant and wife, and upon them signing it he was to release the mortgage, and turn over the check for $375, both of which duties he performed. Appellant turned the check over to Kunert as the balance of the purchase price of the real estate. It was from Kunert that appellant at the time purchased the saloon, and the license under which it was being operated, and which was transferred to appellant. It thus appears that appellee had full knowledge of the whole transaction.

Section 8323f, Burns' R. S. 1914, in force at the time of this transaction, provides, inter alia, that all persons applying for license to sell intoxicating liquors, or for the renewal of such license, shall file a written application, in which it is stated that the applicant is the actual and sole owner of such business; that no other firm, person, or corporation has any interest, directly or indirectly, therein; and that the applicant had not directly or indirectly solicited, received, or accepted, and during the continuation of the license applied for, or any renewal thereof, will not directly or indirectly solicit, receive, or accept, from any person, firm, or corporation engaged in the manufacture or sale of intoxicating liquors, any gift, loan of money, furniture, fixtures, or other assistance of any kind. The section required that such application should be subscribed and sworn to by the applicant.

Section 8323m, Burns' R. S. 1914, requires that one purchasing a license shall file with the board of commissioners a written application for leave to purchase such license at the time and in the manner required of applicants for license to sell intoxicating liquors.

It is a matter of history that a part of the corrupting influence of saloons emanated from the fact that many of them were owned or controlled by the breweries, by whom they were placed in the hands of irresponsible persons who were dependent upon the breweries for their financial support. Public policy demanded that such a condition of dependence and irresponsible operation be abrogated, and the act above mentioned resulted. Under it one under the dependent influence of the brewery, as in this case, by accepting a loan from it under an agreement to use its product exclusively, could not obtain a license to sell intoxicating liquors, for he could not, by his application, qualify himself as a fit and proper person to have such license, unless by his sworn application he committed perjury.

Appellee contends that the answer mentioned is not an answer of illegal consideration, but one of accord and satisfaction, or of payment, and, upon the proposition that illegal consideration is an affirmative defense, and that it must be specially pleaded, cites Casad et al. v. Holdridge, 50 Ind. 529;Fisher v. Fisher, ...