Morton v. Smith

• Decision Date: 30 September 1877
• Parties: J. STERLING MORTON et al.v.JAMES P. SMITH, JR., et al.
• Court: Illinois Supreme Court

86 Ill. 117

1877 WL 9674 (Ill.)

J. STERLING MORTON et al.

v.JAMES P. SMITH, JR., et al.

Supreme Court of Illinois.

September Term, 1877.

APPEAL from the Superior Court of Cook County; the Hon. S. M. MOORE, Judge, presiding.

This was a bill in equity in respect to certain real property claimed as having been held in trust, by the appellees, for Hiram Joy in his life-time, and since his death for Carrie A. F. Morton, his daughter and sole heir. The following facts appear: Hiram Joy was at a former time engaged in the ice business at Chicago, with Augustus Frisbie, under the firm name of Joy & Frisbie. The partnership continued for a period of several years, until December 8, 1860, when the firm, having become largely involved in debt and utterly insolvent, made an assignment to Henry Fuller of all their property and effects for the benefit of their creditors. On December 10, 1860, Joy made an individual assignment for the benefit of his creditors to his brother-in-law, James P. Smith, Sr., any surplus to be paid to the creditors of the firm of Joy & Frisbie.

Prior to these assignments, and on November 1, 1855, Joy had executed a mortgage to one Gorham, to secure the payment of $4,000, upon block 75 in canal trustee's subdivision. Afterwards, and on January 1, 1859, for the stated consideration of love and affection and $1, he conveyed the north-east quarter of said block to Cora E. and Bell Smith, the infant children of James P. Smith, Jr., his nephew; this deed, however, was not recorded until October 8, 1859, and the consideration, in fact, seems to have been the firm indebtedness to Smith. Prior to which time, and on August 19, 1859, Joy & Frisbie executed two trust deeds to Ephraim Ingalls, trustee, to secure the payment of their respective notes for $2,050 and $4,050, payable to L. C. P. Freer, and the trust deeds were recorded on that same day, thus becoming a paramount lien to the deed to Smith's daughters.

Freer purchased the Gorham note and mortgage, and took an assignment of the same to himself. Afterwards, on February 18, 1861, the trust deeds to Ingalls were foreclosed by the sale of the property covered by them under a power of sale in the deeds, subject to the Gorham mortgage, and Ingalls became the purchaser for the sum of $10,354.54, being the whole amount due upon the Gorham mortgage and the trust deeds, together with the expenses of sale, and Ingalls, by deed of that date, conveyed the property to Freer. A few days afterward Freer executed a paper which he calls a proposition. This, in substance, recites the fact and the date of the purchase of the property under the trust deeds; what the property stood him in at cost price, to wit, $10,354.54; that he does not wish to make any profit on the land more than ten per cent semi-annual interest; his willingness, in case anything can be realized, that it shall inure to the family of James P. Smith, Jr., nephew of Joy, who he is satisfied has suffered by the misfortunes of Joy; that to that end he was to hold the property for a market for the period of four years, subject to the conditions therein stated: that is, that he would set down in account the cost price of the property, the taxes on it, and ten per cent interest thereon, to be compounded semi-annually; that at any time during the four years, upon Smith's request, he was to sell specified parcels of the property at the minimum prices which were therein fixed, the proceeds to be applied to the credit of the account. Also Smith was to pay Freer $500 each year, payable quarter-yearly, to be likewise entered, when made, on the credit side of the account, interest to be allowed in the manner above on the credits. At the end of four years from date the account was to be balanced, and any balance due Freer to be then paid, and upon its payment Freer was to convey the remaining unsold portion of the property to Smith as trustee, or to such person as he should direct. It names that the proposition was made without consideration, upon Freer's mere motion, and with the simple desire to give a relative of Joy any profits that can be made out of the land; that he made the proposition to Smith as trustee for and of his daughters, Cora Ellen and Bell Smith, and in the case of their death such profits to inure to Smith's wife.

This paper is signed by Freer, and bears date February 18, 1861, the day of the sale under the trust deeds, but was in fact made some days afterward, and was dated back, as Freer says, as a matter of convenience to show the date of the account. Freer kept the account as proposed, and there were sold off, from time to time, portions of block 75, when it was found that they had realized sufficient to pay Freer off in full without disposing of any portion of the lots 6 and 7 in block 118, above mentioned. They therefore made a full settlement, and Freer subsequently, by quitclaim deed dated February 21, 1865, conveyed lots 6 and 7 in block 118 to Laura A. Smith, the wife of James P. Smith, Jr., in fee simple absolute. Laura A. Smith and her husband subsequently sold and conveyed to different persons all of said premises, with the exception of twenty feet of lot 6 fronting on Monroe Street, which is left remaining unsold.

The claim by the bill is that James P. Smith, Jr., and his wife came into possession of said lots in block 118, and held the same, as trustees for Hiram Joy; that they should account to Carrie A. T. Morton, the only heir of said Joy, for the proceeds of the part sold, alleged to amount to $35,780, and should convey to her the portion remaining unsold.

The court below, upon final hearing, dismissed the bill, and the complainants appeal.

Messrs. WALKER, DEXTER & SMITH, for the appellants...