Robinson v. Miller

• Decision Date: 18 June 1925
• Docket Number: No. 16032.,16032.
• Citation: 317 Ill. 501,148 N.E. 319
• Parties: ROBINSON et al. v. MILLER et al.
• Court: Illinois Supreme Court

317 Ill. 501

148 N.E. 319

ROBINSON et al.

v.MILLER et al.

No. 16032.

Supreme Court of Illinois.

June 18, 1925.

Error to Second Branch Appellate Court, First District, on Appeal from Circuit Court, Cook County; Ira Ryner, Judge.

Suit by Emerson B. Robinson and others against Charles G. Miller and others to foreclose trust deed. Decree for plaintiffs was on appeal affirmed by the Appellate Court (232 Ill. App. 625), and defendant Kurt R. Beak, individually and as trustee, brings certiorari.

Reversed in part, affirmed in part, and remanded, with directions.Stebbins, Garey, L'Amoreaux & Hurtubise, of Chicago, for plaintiff in error.

Kelly, Burns & Daly, of Chicago (James D. Murphy, of Chicago, of counsel), for defendants in error.

DE YOUNG, J.

The defendants in error, Emerson B. Robinson and the Chicago Title & Trust Company as trustee, on June 30, 1921, filed a bill to foreclose a trust deed dated September 1, 1920, from Charles G. Miller and Nellie Miller, his wife, to the Chicago Title & Trust Company, on an apartment building and ground located at the southeast corner of Forty-First street and Grand boulevard, in the city of Chicago. Robinson had conveyed the property to Miller, and the trust deed was given to secure the payment of an indebtedness of $25,000, being a part of the purchase price, evidenced by five principal promissory notes, executed by Miller and his wife, for $5,000 each, the first due on January 1, 1921, and the other four on or before September 1, 1923, and all bearing interest at 6 per cent. per annum, payable semiannually. The installments of interest were evidenced by coupons. After setting forth the execution of the notes and trust deed and their pertinent provisions, it was charged in the bill that default had been made in the payment of $3,500 of the principal of the note due January 1, 1921, of the interest accrued thereon, and of the taxes for the year 1920; that notice of a mechanic's lien for $600 had been filed against the property, and that by reason of these several defaults, and in accordance with the provisions of the trust deed, Robinson had elected to declare, and by the bill did declare, the whole of the indebtedness immediately due and payable. It was further alleged in the bill that the property was scant security for the payment of the indebtedness due from Miller and his wife; that they were insolvent, and that they had executed a subordinate trust deed on the same property, dated September 4, 1920, to Kurt R. Beak to secure the payment of 18 notes, dated the same day, executed by Miller, 17 for $250 each and the last for $4,250, due, respectively, October 4, 1920, and monthly thereafter with interest at 6 per cent. per annum payable semiannually; and that Charles E. Cannon appeared to be the owner of the premises of record. Miller and his wife, Kurt R. Beak, individually and as trustee, Cannon, the unknown holders of the notes secured by the trust deed to Beak, and others, were made parties defendant.

A petition for a receiver pendente lite immediately followed the filing of the bill. While that application was pending, Beak on July 13, 1921, paid the taxes and filed an affidavit, stating the fact and that the mechanic's lien had been released of record. On the same day Beak, Miller and wife, and Cannon by Beak, his attorney in fact, filed their petition, verified by Beak, in which they alleged that Beak was the owner of the 18 notes secured by the trust deed to himself; that Cannon was a resident of California, and had constituted Beak his agent and attorney in fact to use such measures, legal or equitable, as in his (Beak's) discretion might be proper or necessary to enforce the payment of the rents from, or to secure and maintain possession of, the premises; and that Beak was, and for some time had been, in possession of the property and collected the rents derived therefrom. The petitioners asked that they, or some of them, be allowed to give a bond to avoid the appointment of a receiver, and that Beak be permitted to retain possession and continue to collect the rents. The petition was granted, and Beak executed a bond, with a surety which was approved by the court.

Beak, individually and as trustee, and Miller and his wife, filed an answer, in which they averred that Beak paid the taxes for the year 1920 in due season; that on or about January 10, 1921, in consideration of the guaranty of the note due January 1, 1921, by Beak, Robinson agreed (1) to extend its maturity provided payments of $500 on account of the principal were made every 60 days, and the balance paid on or before one year after its date; and (2) that, if Beak performed his guaranty, the note would be delivered to him uncanceled, with an indorsement that it was subordinated to the payment of the remaining notes secured by the trust deed; that on or about June 18, 1921, Beak, desiring to honor his guaranty, inquired of Robinson the amount due on the note, and, upon being advised, on or about June 24, 1921, tendered to Robinson's solicitors the amount claimed, but that they refused to accept the payment tendered and deliver the note to Beak uncanceled; that Beak has been ready, willing, and able, and still offers, to pay Robinson, or upon his order, the sum so due and tendered; that Beak performed the agreement on his part, and that Robinson is not entitled to the relief sought. No replication was filed to the answer.

The cause was referred to a master in chancery, who reported the evidence with his findings, among others, that there was no consideration for the purported extension of the time of payment, that the material allegations of the bill were true, and that the amount due Robinson, including a solicitors' fee of $2,500, found to be reasonable, was $28,101.23. The master recommended that the prayer of the bill be granted. Exceptions were taken to his report, but, before the hearing upon them, defendants in error on September 7, 1922, pursuant to leave granted. filed an amendment to the bill, making additional parties defendant thereto. Beak and Miller and his wife filed a demurrer to the amendment, and on November 10, 1922, the demurrer was overruled. On the same day Robinson dismissed the bill as to certain defendants.Exceptions to the master's report were overruled, and on December 16, 1922, a foreclosure decree in accordance with the master's report was entered Beak, individually and as trustee, prosecuted an appeal to the Appellate Court for the First District, and that court affirmed the decree. He then petitioned this court for a writ of certiorari. The petition was granted, and the record is now here by writ of error.

The principal grounds relied upon by the plaintiff in error for a reversal of the decree are: First, that the court erred in finding that it had jurisdiction of the parties and in entering a decree of sale, because the service had upon Cannon and the holders of the 18 notes secured by the subordinate trust deed was based upon insufficient affidavits, the first notice was published 8 days after the return day of the summons, and the certificate of publication was defective; second, that the order of reference was made before the cause was at issue, and conferred no authority upon the master to rule on the admissibility of evidence, or to make a report; third, that the suit was prematurely brought, because the time of payment of the note due January 1, 1921, had been extended for a valuable consideration, and there was no default under the extension agreement at the time this suit was filed; fourth, that no relief can be awarded because the bill of complaint fails to allege any breach of the extension agreement; fifth, that when the suit was filed there had been no failure to comply with the provision of the trust deed requiring the mortgagor ‘to pay all taxes and assessments * * * as and when the same shall become due and payable’; sixth, that the allegation that notice of a mechanic's lien had been filed against the property is not a breach of the condition of the trust deed ‘to suffer no lien of mechanics * * * to attach to said premises'; seventh, that the tender made to Robinson's solicitors prior to the institution of the suit is a valid defense thereto; and, eighth, that the allowance made Robinson of $2,500 for his solicitors' fees is excessive. These assignments will be considered in the order in which they are stated.

[1] First. It is not necessary to determine whether constructive service upon Cannon and the holders of the notes secured by the trust deed to Beak was properly obtained. In the petition to avoid the appointment of a receiver by giving a bond instead, Beak acted for Cannon and in his name, as his attorney in fact. He invoked in behalf of his principal the exercise of the court's jurisdiction in resisting the appointment of a receiver,...