Watt v. Cecil

• Decision Date: 08 June 1938
• Docket Number: No. 24118.,24118.
• Citation: 15 N.E.2d 292,368 Ill. 510
• Parties: WATT et al. v. CECIL et al.
• Court: Illinois Supreme Court

368 Ill. 510

15 N.E.2d 292

WATT et al.

v.CECIL et al.

No. 24118.

Supreme Court of Illinois.

April 15, 1938.

Rehearing Denied June 8, 1938.

Suit by Robert J. Watt and others against Charles Cecil and others to foreclose a trust deed in the nature of a mortgage. From a decree favorable to plaintiffs, Lucy Rooney appeals.

Reversed and remanded, with directions.Appeal from Superior Court, Cook County; James F. Fardy, judge.

Harold O. Mulks, of Chicago, for appellant.

Gilbert Nelson, of Chicago (Henry D. Brown, of Chicago, of counsel), for cross-appellant John C. Taylor.

Bennett & Colbach and Albert E. Jenner, Jr., all of Chicago, for appellees.

JONES, Justice.

The superior court of Cook county entered a decree foreclosing a trust deed in the nature of a mortgage. The trust deed was given to the Citizens State Bank of Chicago, as trustee. A constitutional question brings the cause directly to this court on appeal by Lucy Rooney, one of the owners of the property involved.

Section 1 of ‘An Act to revise the law with relation to banks and banking,’ adopted by referendum in 1920, Ill.Rev.Stat.1937, c. 16 1/2, § 1, authorizes banks to accept and execute trusts. Appellant claims that section is unconstitutional because the power conferred is not embraced or expressed in the title of the act; that the acceptance and execution of trusts do not constitute banking or the exercise of banking powers, and that the Legislature was without power to delegate to the people legislation in reference to trusts. On this hypothesis she contends that the Citizens State Bank of Chicago had no power to take title to the premises, as trustee, and since it had no such power it could not serve as a conduit of title to its successor in trust. It is also urged that it was error to enter the decree without first appointing a competent trustee.

While we held in People ex rel. Badger v. Loewenthal, 93 Ill. 191, that the business of a trust company does not constitute banking, and in Wedesweiler v. Brundage, 297 Ill. 228, 130 N.E. 520, that acting as a trustee is not within the generally accepted definition of the term ‘banking,’ yet there is no holding in either of those cases that banks may not act as trustees, even without enabling statutes, or that their acts as trustee were void. There is no constitutional inhibition against conferring upon banks the power to accept and execute trusts. Therefore, subject to approval by referendum, the Legislature had the authority to empower banks to accept and execute trusts. The wisdom of such a measure is for the determination of the Legislature and the people.

Conforming to the trend of modern decisions expanding the functions of banking, we said in Walsh v. Stock Yards Trust & Savings Bank, 345 Ill. 265, 178 N.E. 102. 103: ‘Originally banking power was very limited and consisted of receiving money, in exchange for which promissory notes were given, payable to the bearer on demand. Auten v. United States Nat. Bank, 174 U.S. 125, 19 S.Ct. 628, 43 L.Ed. 920. Modern bankers have extended their operations far beyond the original scope of banking powers. Banks frequently act as trustees by appointment of courts or under wills or deeds, and the right of banks in this state to act as such trustees is recognized in Wedesweiler v. Brundage, 297 Ill. 228, 130 N.E. 520.’

The constitutional provision concerning the title of an act does not require the title to express all the minor divisions of the general subject to which the act relates, or that the title be an abstract, a synopsis, or an index of the contents of the act. Ill.Rev.Stat.1937, Const. art. 4, § 13. People v. Mueller, 352 Ill. 124, 185 N.E. 239. All matters may be included in the act which are germane to the title and relate to the same general subject. People v. Monroe, 349 Ill. 270, 182 N.E. 439, 85 A.L.R. 605;People v. Emmerson, 333 Ill. 606, 165 N.E. 217, 62 A.L.R. 912. Conferring authority upon banks to accept and execute trusts manifestly pertains to the functions of banking as much so as the powers to discount, receive deposits, and loan money. The holding in the Wedesweiler Case that section 15 1/2 of the Banking Act, Smith-Hurd Stats. c. 16 1/2, § 16, prohibiting natural persons, firms, or partnerships from engaging in the business of transmitting money to foreign countries and buying and selling foreign money in this state, was unconstitutional because the subject matter was not germane to or embraced in the title of the act, has no application here. In view of our recent decisions, and the provisions of section 1 of the Banking Act, Ill.Rev.Stat.1937, c. 16 1/2, § 1, we hold that banks in this state have power to accept and execute trusts, and that such power is sufficiently embraced in the title of the act.

The contention that the acceptance and execution of trusts in not banking or the exercise of banking powers, and that, therefore, the power to legislate in reference to such trusts is vested in the General Assembly and may not be delegated to the people by referendum, is equally untenable. People ex rel. v. Barnett, 344 Ill. 62, 176 N.E. 108, 76 A.L.R. 1044, holding void a statute providing for jury service by women because of an unauthorized referendum, is distinguishable from the case at bar. In that case the power to legislate on the subject was reposed exclusively in the Legislature. Section 1 of the Banking Act pertains to banks and banking, and, because of the constitutional mandate, was necessarily submitted to the people for approval. It would have been unconstitutional if it had not been so submitted. Reed v. People ex rel. Hunt, 125 Ill. 592, 18 N.E. 295,1 L.R.A. 324.

The claim that no default existed when the original bill was filed is not supported by the record. The original bill of complaint filed September 7, 1932, recited that the mortgaged premises ‘are subject to the unpaid general taxes for the year 1930, which are now past due and for prior years.’ The trust deed contained a covenant to pay all taxes and a breach of that or any other covenant was specifically made a ground for declaring the whole indebtedness due. The master in chancery found that the 1930 general taxes were unpaid, and the record shows they remained unpaid until 1935 when they were paid by the receiver. On May 25, 1936, the date the second amended and supplemental bill was filed, and later, on January 26, 1937, when the final decree was entered, there was an indisputed default in the payment of principal, interest, and taxes.

The court did not err in permitting the holders of three of the notes secured by the trust deed to become parties complainant on September 27, 1934, while the suit was pending. They were interested and had a right to become parties to the proceeding. Ill.Rev.Stat.1937, c. 110, § 149.

Because nearly two years intervened between the date the suit was filed and the securing of service upon all the defendants, it is claimed a discontinuance ensued and the cause abated. The record does not show that appellant made any such claim in the superior court. She filed a general appearance and answer. Her failure to raise the question there amounts to a waiver of the right. Wells v. Mason, 4 Scam. 84;Phillips v. Hood, 85 Ill. 450.

Appellant urges that the publication of notice to ‘unknown owners' was insufficient to acquire jurisdiction over them because more than three years elapsed between the filing of the original bill and the time of publication. The amended and supplemental bill was filed in January, 1936, and publication was had in May, following. This was within reasonable time after the filing of the amended bill. Alexander Lumber Co. v. Kellerman, 358 Ill. 207, 192 N.E. 913. Appellant entered her general appearance and cannot now raise the question of jurisdiction over other defendants who are not complaining of the decree and have assigned no error. St. George v. Bender, 342 Ill. 296, 174 N.E. 406;Gottschalk v. Noyes, 225 Ill. 94, 80 N.E. 72. Nor is she in a position to complain of the failure of the chancellor to enter a rule against the other defendants to answer the second amended and supplemental complaint. Appellant was bound to take notice of its filing, and she and her husband were granted ten days to file an answer. If error resulted to parties who have not joined in the appeal, she cannot take advantage of it on her own behalf. St....