Prange v. City of Marion

• Decision Date: 01 June 1943
• Docket Number: Gen. No. 4205.
• Parties: PRANGE ET AL. v. CITY OF MARION.
• Court: United States Appellate Court of Illinois

319 Ill.App. 136

48 N.E.2d 980

PRANGE ET AL.

v.CITY OF MARION.

Gen. No. 4205.

Appellate Court of Illinois, Fourth District.

March 2, 1943.

As Modified on Denial of Rehearing June 1, 1943.

Appeal from Circuit Court, Williamson County; Loyd M. Bradley, Judge.

Suit in chancery by C. A. Prange and another against the City of Marion, Illinois, for an accounting and to recover amounts allegedly due named plaintiff from the city on account of nonpayment of special improvement bonds issued by the city. Defendant filed counterclaims setting up overpayments of interest on bonds as a set-off against amounts due on bonds. From a decree awarding judgment for only a part of the amount claimed, named plaintiff appeals.

Decree reversed and cause remanded with directions. E. E. Denison, of Marion, for appellant.

David A. Warford, of Marion, for appellee.

BRISTOW, Justice.

Appellant C. A. Prange and one George A. Wallace, who does not appeal, as plaintiffs, filed their complaint, in chancery, against the City of Marion, Illinois, for an accounting, and to recover several amounts claimed due appellant from said city. The claim is based upon non-payment of special improvement bonds issued by said city, for a local improvement, called, “Sidewalk District No. 4.”

Appellant filed Counts One and Three which charge the same matter, except that Count Three is to recover on bonds under the seventh installment of the improvement. Questions for consideration in this appeal are in regard to the charges of liability contained in allegations of Paragraphs 13a, 13b, 13c, 13d and 14a to 14f and 15a to 15f and 16a to 16e, hereafter referred to as Paragraphs 13, 14, 15 and 16.

Paragraphs 13 allege that the city unlawfully, wrongfully and knowingly cancelled and abated assessments against 47 private property owners, omitted same from the Roll of the City Collector and omitted all assessments levied against itself for public benefits which amounted to $900 per year against the city. The total amount so omitted against private property on installments 2 to 10 was $4,853.70, of which $1,428.60 should have been paid on appellant's bonds with interest.

Paragraphs 14 allege that the city collected assessments from private property owners and that the city negligently, improperlyand wrongfully diverted same and used same for some other purpose and should be liable to appellant for such pro rata amounts due him under installments 5 to 10 with interest from the dates each installment was due.

Paragraphs 15 allege that the city was a trustee for the benefit of bond owners and had the duty to use every reasonable effort and legal means to collect installments; to pay into the fund assessments levied against it, but that it intentionally failed to pay assessments of $900 on each installment 2 to 10 against it and refused to pay interest at 6% under the ordinance and statute whereby there was a deficiency; that the total amount assessed against the city which it had not paid into the installment fund was $8,100 and that with interest at 6% thereon under such installments, the amount for which the city was indebted to appellant was $3,417.92.

Paragraphs 16 allege that assessments against private properties in the amount of $32,931.90 became delinquent from which the pro rata share of appellant's bonds was $10,893.18; that such properties became delinquent and were forfeited to the State; that it was the duty of the city to perfect tax titles and tender same to the unpaid bondholders in lieu of unpaid assessments, and that the city negligently, wrongfully and unlawfully failed to perform its statutory duties as trustee, as alleged under said Paragraphs 13, 14, 15 and 16 whereby there was a deficit and appellant's bonds were not paid.

Upon motion of the defendant, the trial Court entered an order dismissing said Paragraphs 13 and 16 and denied motion to strike said Paragraphs 14 and 15.

Defendant filed answers denying averments in the complaint and then filed counterclaims to each count, alleging overpayment of interest made to appellant or former owners of his bonds and claimed same as a set off against the amounts due on appellant's bonds. On motion of appellant, the counterclaims were stricken. Defendant then in same wording as used in the counterclaim, filed pleas of payment on the bonds by overpayment of interest. Motion to strike these special pleas of payment were made and overruled. The cause was referred to a special master to take proof and report his findings. He made his findings of fact and his report both as to the facts and also his conclusion of law. He reported as a matter of law there could be no recovery under said Paragraphs 14 and 15, though proven, which the Court by its ruling had directed him to consider as setting up legal grounds of liability. Various exceptions and motions were made to the master's report but were overruled, and later the cause coming up before another trial judge, a decree was entered approving the report of the master.

This decree, in substance, held that appellant-plaintiff, could not recover from the defendant under said Paragraphs 13 because of any rebating or cancelling of assessments levied against private property; that no recovery lay under said Paragraphs 16 because of failure of defendant city as trustee to perform its duty as trustee and collect assessments levied against private properties or obtain such tax titles against private properties and to tender such tax titles to the bond holders; that no recovery could be had under Paragraphs 15 because of the city's failure and refusal to pay the amount of public benefits assessed against itself, with interest. The decree held that the city was liable under Paragraphs 14 for assessments collected by it from private landowners which had been wrongfully diverted by and used by the city for other purposes with interest on same from the date of the last collection made. Under the plea of payment, the decree directed that the amount of $3,840, with interest, should be deducted from the amount it otherwise found due plaintiff-appellant from assessments which the city had collected and diverted to other uses. After such deduction the decree awarded appellant- plaintiff a judgment against the appellee-defendant in the amount of $7823.04.

The evidence showed the proceedings for this improvement was divided into ten installments, of which number 2 to 10 each were in the amount of $12,700. Total amount assessed against the city was $9,718.51 and in the amount of $900 under each of said installments 2 to 10. Against private properties $11,800 was assessed on each of said installments 2 to 10. Money was borrowed against installments 2 to 10 by the city and bonds were issued for the amount of $11,800 against each of the first seven of said installments; $5,000 against the eighth and $7,500 against the ninth of said installments 2 to 10. Appellant owned 61 bonds in the total face amount of $29,900 payable under installments 5 to 10 which matured annually from July 1, 1927, to July 1, 1932. Some payments were made upon these bonds up to the year 1935 being in the total amount of $4,460.50. The city collected, diverted to use for other purposes, $9,032.06 on installments 5 to 10. That amount with interest at 5% from the respective dates of collection by the city calculated to January 1, 1941, would be $14,369.92. The total amount of $900 per year which the city did not collect, with interest on same at 6% from the date each of said $900 installments were due calculated to January 2, 1941, would be $14,418.

The city collected on interest accounts certain amounts from private property but not in an amount equal to the coupons due. The city claimed it had paid in full all of the coupons and as interest had paid on appellant's bonds more than the amount of the coupons in the total sum of $3,848. No overpayment was made to plaintiff-appellant. The records of the city and testimony of witnesses failed to show the name of any person to whom any overpayment of interest had been made.

The foregoing is a synopsis of the detailed statement of pleadings, proceedings and facts recited in appellant's brief. Appellee agrees that the foregoing matter we have recited, is correct.

On one point only do appellant and appellee disagree as to facts proved. Appellant contends that the evidence showed that a certificate of final completion and acceptance of the improvement was filed in the County Court, notices of hearing thereon given and proceedings had in the County Court and judgment entered by the County Court finding that the improvement had been completed in accordance with the ordinance. Appellee contends that the proof made was by evidence which was not competent and that the finding of the special master and of the Court in its decree that all proceedings had been had strictly in compliance with the law in the County Court, was an erroneous finding. But appellee has filed no cross errors or cross appeal.

The trial court by its denial of motion to strike Paragraphs 15a to 15f held as a matter of law that if same were proven, liability would lie against the city. These paragraphs charged that the city had deliberately omitted all assessments against itself from the Roll of its City Collector and had paid nothing on assessments against itself. Such facts were also proven.

Appellant first earnestly argues that since the trial court in the first instance so held liability under said paragraphs and that since the special master wrongfully exceeded his authority by reporting his conclusion of law to the contrary, this case should be reversed. Authorities cited are Hards v. Burton, 79 Ill. 504;Fordyce v. Shriver, 115 Ill. 530, 540, 5 N.E. 87;Wilhite v. Pearce, 47 Ill. 413, 416;Ennesser v. Hudek, 169 Ill. 494, 48 N.E. 673;Kelly v. Fahrney, 145 Ill.App. 80;Barnes v. Barnes, 282 Ill. 593, 118 N.E. 1004, 4 A.L.R. 4;Hollahan v. Sowers, 111 Ill.App. 263.

These cases do set out the...