Court Opinion

ID: 8807461
Source: CourtListenerOpinion
Date Created: 2022-11-26 14:51:57.324788+00
Date Added: 2024-06-11T17:04:09.368591
License: Public Domain

Mr. Justice Chytraus delivered the opinion of the court. Trusts are of two kinds: express and implied. Implied trusts are again divided into resulting and constructive trusts. A resulting trust—being one of the class of implied trusts—arises only by implication of law and not by contract. ‘ ‘ Such a trust is never raised unless the money of the cestui que trust was used in the purchase of the property in which the trust is claimed to exist;” Jacksonville Nat. Bank v. Beesley, 159 Ill. 120, 125. In order to establish a resulting trust the one claiming it must show that he has furnished the consideration money or some aliquot part thereof, as part of the original transaction at the time the property, in which the trust is claimed, was acquired. We agree fully with appellees’ contention that there is in this case no room for establishing a resulting trust. But the bill is not framed upon the theory of establishing a resulting trust. The theory thereof seems to be a mixed one of constructive trust and partnership. It is a very inartificial bill of complaint and was apparently drawn without opportunity of full preparation and without a clear and well-defined idea, in the mind of the pleader, of maintaining the bill upon any definite theory of law. The ground covered and the scope of the statements rather incline to the theory of a constructive trust. These trusts, like the resulting trusts, arise, wholly, by implication of law and irrespective of contract. Equity establishes them in order to prevent one person from taking any unfair or unjust pecuniary advantage of another where that is made possible either by reason of some position or relation in which that other has been placed by such person or by some other fiduciary relation. See, for instance, Davis v. Hamlin, 108 Ill. 39. In the bill before us the theory of a constructive trust appears to be that Bice, at the time Dougherty appeared, was in a situation of some financial value and advantage, in connection with the assets and business of the old piano company and the opportunity of forming a new and promising business. The new business was formed, as a result of the combined efforts of Dougherty and Bice, although the contribution by each was of a different character and the business, as alleged, did in fact become a very profitable and prosperous business. Thereupon, it is alleged, Dougherty, who was, by reason of the trust and confidence imposed in him, enabled so to do, availed himself of the opportunity for his sole financial benefit and advantage and excluded Bice from the business and profits. It appears to be claimed that a constructive trust has arisen in favor of Bice in the profits that have grown out of the use of Dougherty’s money and Bice’s plans, initial knowledge, co-operation, time and other efforts. In this connection the manner in which Dougherty was brought into the business and what he has led Bice to believe and from time to time said to him, is also invoked. If it be true that Dougherty obtained a profitable investment of his money through Bice’s knowledge and efforts, together with his own, and, in the same connection, Bice was led to believe that, after Dougherty had been refunded his investment, they would share equally in the surplus or profits, Dougherty would be estopped from claiming the contrary after the business had proved profitable and then, no matter what form those profits might be converted into, equity would follow them. But, as we are obliged to reverse and remand this cause, without consideration of the merits, we have refrained from an examination into these merits and we have no opinion thereupon. We are of opinion that the decree rendered July 13, 1906, is a final decree. While that decree was drafted regardless of the rules and practice governing the formation of decrees yet, in' and by the language thereof and the necessary intendments and inferences that follow thereupon, that decree, so far as the chancellor, that is the Circuit Court, is concerned, finally operates upon and disposes of the rights of the parties which are in contention. The decree determines how the property subject-matter in controversy shall be disposed of. In that respect it does not contemplate, but clearly negatives the idea, that the chancellor shall again inquire or investigate any further. Obviously it is designed to be final and conclusive in that regard. That a decree must be read and construed in connection with the pleadings is an elementary rule, and that rule aids us here in understanding a decree which would, without it, perhaps, be unintelligible. The decree definitely and expressly allows each of the parties —Dougherty and complainant—two hundred dollars per month, which the bill discloses to be for living expenses. The payments of these amounts must, by necessary and reasonable intendment, be considered to begin when the business involved began. Being payable monthly these payments, by necessary inference, take precedence, in order of payment, ahead of other allowances provided for in the decree. In the light of the rule referred to we find the decree determines that Dougherty has the right to be refunded the money invested by him, there is no contention to the contrary in the pleadings, and the decree expressly provides that he shall have lawful interest thereupon, which is, in this state, five per centum per annum. The pleadings show no contention but what this investment, with interest thereupon, shall have priority, subordinate only to the monthly payments of two hundred dollars, and, besides, the use of the word “profits” in the decree, in providing for the disposition of the remainder determines for the master, who is to take the accounting decreed, the order of priority between this item and the remainder. Profit is naturally subordinate to investment. Finally the decree disposes of one-half of the net profits by allowing the same to the complainant and thus limits what he is entitled to, necessarily the other half is allowed to Dougherty, the only other person in contention according to the pleadings. Thus it appears that the basis upon which an accounting, if necessary in regard to the business conducted before the incorporation, might be had and the principles that should govern the master in taking such accounting, are clearly ascertainable from the decree. The decree further orders the cause to be referred to a master to take and state an account. The relative rights of the two contending parties, in respect to the questions in contest, are clearly and conclusively fixed by the decree. Without reversal of that decree the relative rights of the parties, so far as judicial adjudication is concerned, cannot be otherwise than as thus fixed by the decree. When a decree determines and definitely settles the rights of the contending parties, relatively, with reference to the subject-matter of the controversy, then the decree is final. That is, when the relative quantity of interest of each of the parties is judicially fixed so that nothing remains but to carry out that adjudication in detail, as, for instance, by a reference to a master to take proof and report upon an accounting, between the parties, according to some basis fixed by the decree, or to ascertain the money equivalent of each of the interests, or to make a sale for division of the proceeds, then the decree is final and appealable. Such is the principle of De Grasse v. Gossard Co., 236 Ill. 73, 76. This is the more practical and, in reason, the better rule; for, perchance, the chancellor has erred in his determination in respect to the substantial relative rights of the parties. In such case to compel the parties to carry through lengthy and expensive accountings and make proof before the master upon an erroneous theory, before rectification of the error upon review, would put the parties to great and needless expense and, quite possibly, to irreparable injury, through waste of time and onerous expense. The rule, that a decree is final when it determines and definitely settles the rights of contesting parties, irrespective of the fact that something remains to be done, which the chancellor directs to be done before a ministerial officer of the court, such as a master or commissioner, is unquestionably correct on principle. The contrary, rule would, in some instances, involve a second exhausting proceeding before a master upon the correct theory and, sometimes, an accounting and public exposure of books, before a master, in the first instance, where, rightfully, there should be none. It appears clear to us that the decree of July 13,1906, is a final decree. Whether that decree is supported by the evidence is a different and distinct question, which is not involved in the present appeal. We hold that there was error in setting aside the decree of the June term of court at the September term of court and in then allowing a rehearing upon the exceptions to the master’s report. Consequently the decree of October 14, 1907, was erroneously rendered. The fact that the decree rendered at the June term was called an “interlocutory” decree is immaterial. The question whether a decree is final is not determined by what it is called, but by the contents thereof. The substance and effect thereof controls; not the intention of the chancellor, except as ascertained from the contents. Reversed and remanded.