Rohde v. Rohn
| Decision Date | 06 February 1908 |
| Citation | 83 N.E. 465,232 Ill. 180 |
| Parties | ROHDE v. ROHN. |
| Court | Illinois Supreme Court |
OPINION TEXT STARTS HERE
Appeal from Appellate Court, First District, on Appeal from Superior Court, Cook County; Theodore Brentano, Judge.
Suit by John Rohde against Fredericka Rohn and others. From a judgment of the Appellate Court (127 Ill. App. 579) affirming an adverse decree, complainant appeals. Reversed and remanded.
John Stelk (James S. Murray, of counsel), for appellant.
George F. Barrett (Charles V. Barrett, of counsel), for appellee.
The appellant, John Rohde, filed a bill in chancery in the superior court of Cook county on the 27th day of July, 1903, against the appellee, Fredericka Rohn, and others, to foreclose a trust deed bearing date September 22, 1892, given by Paul F. C. L. Schmidt and wife to Charles C. Schumacher upon certain real estate located in the city of Chicago to secure the payment of the promissory note of Schmidt for the sum of $2,500, of even date with said trust deed, due and payable two years after its date to the order of Schmidt, with interest at 6 1/2 per cent. per annum, which promissory note was indorsed by Schmidt, and upon which promissory note there had been paid on the principal $500, which trust deed was acknowledged on Octover 10, 1892, and recorded in the recorder's office of Cook county on October 11, 1892. The appellee answered said bill, and filed a cross-bill, in which she alleged she was the owner of a note for the sum of $1,600, bearing date February 27, 1900, signed by one Frank M. Dimond and by him indorsed, which promissory note was secured by a trust deed on the premises described in the original bill, bearing date February 27, 1900, from said Frank M. Dimond to Charles C. Schumacher, which trust deed was acknowledged February 28, 1900, and recorded in the office of the recorder of deeds of Cook county on March 16, 1900, which Dimond trust deed, it was alleged, though subsequent in date to the Schmidt trust deed, was a prior and superior lien to said Schmidt trust deed upon said premises. The appellant filed an answer to said cross-bill, and replications were filed to the answers to said original and cross-bills, and the case was referred to a master to take the proofs and report his conclusions. The master filed a report, in which he found that the Schmidt note and trust deed were a prior and superior lien on said premises to the Dimond note and trust deed, and recommended that a decree be entered in said cause in accordance with said finding. The court sustained exceptions to said report in so far as it found that the Schmidt note and trust deed were a prior and superior lien to the Dimond note and trust deed, and entered a decree establishing a lien upon said premises in favor of the appellee upon the Dimond note and trust deed for the sum of $1,833.38 and in favor of the appellant upon the Schmidt note and trust deed for the sum of $2,311.18, and directed that the lien of appellee be satisfied prior to the lien of appellant, and ordered that said premises be sold to satisfy said liens. From that decree the appellant prosecuted an appeal to the Appellate Court for the First District, where the decree of the superior court was affirmed, and a further appeal has been prosecuted to this court.
The facts in this case are not in controversy. It appears that Paul F. C. L. Schmidt, on the 22d day of September, 1892, was the owner in fee of lot 40, in block 3, in S. J. Walker's dock addition to the city of Chicago; that on that date he borrowed of Charles C. Schumacher the sum of $2,500 and executed his promissory note for that amount, bearing 6 1/2 per cent. interest per annum, payable to the order of himself two years after date, which note was by him indorsed and the payment thereof secured by a trust deed on said premises made by him to Charles C. Schumacher, bearing even date with said note, which trust deed was acknowledged and recorded, and which note and trust deed were delivered by him to Schumacher, and that $500 was paid by Schmidt on the note, and that Schumacher afterwards sold and delivered the note and trust deed to one Florence McCarthy; that on April 21, 1898, Schmidt and wife conveyed said premises to Schumacher, subject to said trust deed, for the sum of $150. The deed from Schmidt and wife to Schumacher was recorded on May 4, 1898, and Schumacher paid the interest on the said note until February 20, 1900, when he paid to Florence McCarthy the full amount thereof and Florence McCarthy delivered the said note and trust deed to Schumacher. On February 27, 1900, Schumacher procured one Frank M. Dimond, a clerk in his office, to execute his note for the sum of $1,600, payable to the order of himself three years after its date, with interest at 6 per cent. per annum, and to indorse the same, and to execute a trust deed to secure said note to Schumacher, as trustee, on the premises covered by the Schmidt trust deed, in which premises Dimond had no interest, but which premises were then owned by Schumacher, and said trust deed was recorded March 16, 1900, and said note and trust deed were delivered by Dimond to Schumacher, and on September 10, 1900, Schumacher sold the Dimond note and trust deed to Rudolph Rohn, representing to him that they constituted a first lien upon the property described in said trust deed. Rudolph Rohn died, and said note and trust deed, in the distribution of his estate, became the property of the appellee. Fredericka Rohn. In October, 1900, Schumacher had $4,000 of the money of the appellant, John Rohde, in his hands, which he had collected upon notes held by him belonging to Rohde, and on October 18, 1900, he sold and delivered to John Rohde, in part payment of said sum of $4,000 the Schmidt note and trust deed, and represented to Rohde that they were a first lien on the premises described in said trust deed. The said note at that time bore an indorsement dated September 22, 1900, signed, ‘Frank M. Dimond, Assignee of Paul F. C. L. Schmidt,’ purporting to extend the time of payment of said note three years from that date. He also delivered to Rohde six interest notes, and a paper signed, ‘Frank M. Dimond, Assignee of Paul F. C. L. Schmidt,’ purporting to extend the payment of said note and trust deed three years from September 22, 1900. Schumacher paid the interest due upon the Schmidt note and trust deed and upon the Dimond note and trust deed until in May, 1903, when he died. Neither Rohde nor Rudolph Rohn had any knowledge of the transaction of the other with Schumacher, or that the securities held by them, respectively, were other than they were represented by Schumacher to be at the time he sold and delivered said notes and trust deeds to them, respectively, and did not obtain any knowledge thereof until after the death of Schumacher, and until about the time this bill was filed. It thus appears that Rudolph Rohn obtained the Dimond note and trust deed from Schumacher on September 10, 1900, and that John Rohde obtained the Schmidt note and trust deed from Schumacher on October 18, 1900, and the only question to be determined upon this record is which of said notes and trust deeds constitutes the prior lien upon said premises.
At the time the Dimond note and trust deed were executed by Dimond, and at the time said note and trust deed were sold to Rudolph Rohn by Schumacher, Dimond had no interest in the premises covered by said trust deed, and at the time the Schmidt note and trust deed were sold and delivered to Rohde by Schumacher the Schmidt note and trust deed had been paid and satisfied and the trust deed had become merged in the fee title which was then held by Schumacher, and neither of said trust deeds was a lien upon said premises other than upon the ground that Schumacher, the owner of the fee to said premises, had represented to Rudolph Rohn and Rohde that the trust deeds which he sold and delivered to them, respectively, were first liens upon said premises, and he, in equity, was estopped to deny that said representations were true, and as against him said trust deeds would be held to create valid liens upon said premises. The Appellate Court held, and such holding is conceded by the counsel for the respective parties to be correct, that the appellant and appellee each held an equitable mortgage on said premises, and that court affirmed the decree of the superior court upon the ground that the equities of the parties being equal, and appellee's equity being the prior one in point of time, it should prevail.
The appellant contends the Appellate Court erred in affirming the decree of the superior court, as it is said the...
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