Court Opinion

ID: 3413548
Source: CourtListenerOpinion
Date Created: 2016-07-05 19:41:21.525112+00
Date Added: 2024-06-11T14:03:22.438681
License: Public Domain

Plaintiffs (appellees here) brought an action in the circuit court of Cook county for the purpose of enforcing a certain "restrictive agreement" concerning the real estate of approximately five hundred owners in the city of Chicago. The substance of this agreement, set forth in haec verba in Burke v.Kleiman, 277 Ill. App. 519, was that no part of the property restricted should be sold, leased to, or permitted to be occupied by any person of the colored race prior to January 1, 1948. The property covered by the agreement consists of approximately twenty-seven blocks and parts of blocks between Sixtieth and Sixty-third streets, and between Cottage Grove and South Park avenues in Chicago. The agreement contained the following provision: "This *Page 371 
agreement and the restrictions herein contained shall be of no force or effect unless this agreement or a substantially similar agreement, shall be signed by the owners above enumerated of ninety-five per centum of the frontage above described, or their heirs or assigns, and recorded in the office of the Recorder of Deeds of Cook county, Illinois, on or before December 31st, 1928."
The complaint alleged that the owners of ninety-five per cent of the frontage signed the agreement, and that it was recorded February 1, 1928. It further alleged a conspiracy on the part of the defendants to destroy the agreement by selling or leasing property in the restricted area to negroes. It charged that Eva Somermon, one of the signers of the agreement, conveyed her property to one Stoltz, who, on the same day, conveyed it to the First National Bank of Englewood; that, through fraudulent concealment on the part of defendants James J. Burke and Harry A. Pace, from the bank, of the fact Hansberry was a negro and that the property was being purchased for him, a deed was procured from the bank to Jay B. Crook who, in fact, purchased for Hansberry; that the deed from the bank to Crook was not delivered until May 26, 1937, but that on May 19, 1937, Crook and his wife executed and delivered a trust deed to the Chicago Title and Trust Company, as trustee, to secure their note for $4400 payable to defendant the Supreme Liberty Life Insurance Company, of which defendant, Pace, a colored attorney, was president. May 26, 1937, the day the deed was delivered, Hansberry and his family moved into the premises.
The answer of defendants denied that the owners of ninety-five per cent of the frontage described in the restrictive agreement had signed the agreement, and asserted the agreement never went into effect. It also denied the principal allegations of the complaint and set up several affirmative defenses. To the defense that the agreement was never executed plaintiffs replied that that question was *Page 372 res judicata, having been determined in Burke v. Kleiman, supra, and in other cases in the circuit and superior courts of Cook county. The chancellor reserved his ruling on the plea of resjudicata and the cause proceeded to a hearing on the merits. At the close of the evidence the court found that the owners of only about fifty-four per cent of the frontage had signed the agreement, but held the question of execution was res judicata.
A decree was entered in conformity with the prayer of the complaint, restraining defendant Burke from selling or leasing any real estate within the restricted area to negroes, or to white persons for the purpose of selling or leasing to negroes; restraining defendant Katz from selling or leasing a certain described building to negroes; restraining defendants Pace and the Supreme Liberty Life Insurance Company from making any further loans on real estate in the restricted area to negroes or for occupancy by negroes; declaring the conveyance to Hansberry and wife void and ordering them to remove from the premises, and holding the restrictive agreement valid and in full force and effect. Inasmuch as a freehold is involved, defendants have appealed directly to this court.
In order to decide whether the question of due execution is resjudicata, it will be necessary to examine the case of Burke v.Kleiman, supra. That was a suit to enforce this same agreement. Olive Ida Burke, wife of James J. Burke, a defendant in the case at bar, was plaintiff. The complaint recited that she filed it "on behalf of herself and on behalf of all other property owners in the district covered and affected by the agreement hereinafter mentioned, and who are, or whose grantors, direct or otherwise, were parties to said indenture of agreement, and whose property interests will be adversely and injuriously affected by the violation hereinafter mentioned by the said defendants of the covenants and terms of said agreement." The defendants were Isaac Kleiman, the white owner, Sam Kleiman, James L. Hall, a negro tenant, and Charles J. Sopkin, trustee *Page 373 
of a trust deed on the property. The complaint alleged the agreement was signed by the owners of ninety-five per cent of the frontage and duly recorded February 1, 1928. A stipulation was entered into to this effect. The court recited the stipulation in its decree and found that the facts stipulated were true. The court further found "that said indenture was in full force and effect on February 1, 1928, and all conditions therein contained with respect to execution and recordation thereof were fully complied with;" that "all terms of said indenture agreement are entirely valid and binding," and that it is a covenant running with the land. This decree was affirmed by the Appellate Court.
It thus appears that Burke v. Kleiman, supra, was a class or representative suit. It cannot be seriously contended that it was not properly a representative suit. There was a class of individuals who had common rights and who needed protection. They were so numerous it would have imposed an unreasonable hardship and burden on them to require all members to be made parties to the suit. Under such circumstances we have repeatedly held that a court of equity has jurisdiction of representative suits, and where the remedy is pursued by a plaintiff who has the right to represent the class to which he belongs, other members of the class are bound by the results in the case unless it is reversed or set aside on direct proceedings. Groves v. Farmers State Bank,368 Ill. 35; Leonard v. Bye, 361 id. 185; Greenberg v. City ofChicago, 256 id. 213.
Appellants contend the doctrine is inapplicable here for the reason there was no class, since the evidence shows the requirement that the owners of ninety-five per cent of the frontage sign the agreement, was not met. This argument loses sight of the fact that in Burke v. Kleiman, supra, the court had jurisdiction to determine whether or not that condition precedent had been complied with. The mere fact that it later appears that the finding is untrue does not render the decree any the less binding. The principle of *Page 374 res judicata covers wrong as well as right decisions, for the fundamental reason that there must be an end of litigation. A matter which has once been determined by a court of competent jurisdiction cannot, in a later suit involving the same subject matter and the same parties or members of the same class, be again inquired into.
We see no merit in the contention that Burke v. Kleiman, supra, is not res judicata because the fact of due execution was established by stipulation. There is no evidence of fraud or collusion in that case. Defendant Burke, who was beneficial owner of plaintiff's property, avers in his answer here that that suit was instituted at the instance of the Woodlawn Property Owners Association, whose purpose was the enforcement of the restrictive agreement. That may be true, but there is no showing of fraud or collusion in procuring that stipulation, or that there was not an actual controversy in the case. At that time Burke was an officer of the Woodlawn Property Owners Association. Afterwards he resigned his position and withdrew from the association with ill feelings, and stated several times that he would put negroes in every block of that property. In carrying out his threat, he falsely represented that prospective customers were white. As far as the record shows, if any fraud was committed, it was by Burke after he left the association. It does not appear that he was not acting in good faith in Burke v. Kleiman, supra.
In our opinion the questions of execution and validity of the restrictive agreement are res judicata. The reasons assigned, in addition to those urged in Burke v. Kleiman, supra, for holding the agreement invalid cannot be considered. It is well settled that the doctrine of res judicata extends not only to matters actually determined in the former suit, but also embraces all grounds of recovery and defense involved and which might have been raised. By assigning new reasons for holding the agreement invalid, which existed at the time that decision was rendered, the parties cannot relitigate the question settled by the prior decree. *Page 375 In re Northwestern University, 206 Ill. 64; Midlinsky v. Rubin, 341 id. 378; People v. Wade, 351 id. 484; Webb v. Gilbert, 357 id. 340.
The evidence fully justifies the finding of the chancellor that the charges of the complaint were established, and appellants do not argue to the contrary, except as to Israel Katz. There was testimony that he said he would sell his property to anybody, including negroes. This is sufficient evidence to warrant enjoining him from doing that which he is bound by the restrictive agreement not to do.
Appellants contend it was error to restrain the Supreme Liberty Life Insurance Company from making loans in the restricted area to negroes or for negro occupancy, for the reason mortgagees were expressly exempted from the operation of the restrictive agreement. The provision relied on is "and provided, further, that the lien of no mortgage or trust deed in the nature of a mortgage shall be impaired or invalidated by reason of the breach of any of the provisions of this agreement, whether any such breach shall have occurred prior or subsequent to the recording of any such mortgage or trust deed." The next clause is "and provided, further, that nothing contained in the foregoing provisions shall in any manner impair the right of any person or persons interested, to enforce at all times and against all persons the restrictions in this agreement contained prohibiting the use or occupation of all or any part of said premises by a negro or negroes." That part of the agreement relied on merely provides that the loan or mortgage shall not be invalidated by reason of its being made in violation of the restrictive agreement. It does not give mortgagees a license to conspire to destroy the agreement, as the evidence shows this insurance company was doing. The decree simply restrains them from making such loans in the future; it does not attempt to hold any existing loans or mortgages invalid. The court did not err in this respect.
We cannot agree that the court erred in overruling appellants' motion to set aside the decree and for a new trial. *Page 376 
This motion was supported by an affidavit of Fred L. Helman, which recited that Helman was executive secretary of the Woodlawn Property Owners Association from 1926 to 1933. The substance of the affidavit is that he had charge of the work of obtaining signatures to the restrictive agreement, and that at the time the case of Burke v. Kleiman, supra, was instituted, as a result of his own investigation, he knew that the owners of ninety-five per cent of the frontage involved had not signed the agreement, and that he conferred with various officials of the association in regard to the filing of that suit. The affidavit does not state that he communicated his information to anybody, or that Olive Ida Burke or any individual of the representative class for whose benefit the suit was brought, or any of the officers of the association, except Helman, knew of this fact. As far as the affidavit discloses Helman is the only person who knew of the defect. It does not allege the suit was brought at the request of the association or that it was not instituted by Mrs. Burke of her own volition and in good faith, for the benefit of herself and the other members of the class. The motion was properly denied.
The decree of the circuit court is affirmed.
Decree affirmed.