Court Opinion

ID: 6960961
Source: CourtListenerOpinion
Date Created: 2022-07-24 01:45:30.292144+00
Date Added: 2024-06-11T16:08:25.016008
License: Public Domain

Scott, J. dissenting: Every question made on the record in this case, which is itself very voluminous, has been elaborately argued, but, in my opinion, one objection taken to the decree is fatal. That I will discuss as briefly as I can to present my view of the case. On the 5th day of July, 1871, one John Allen entered into a contract with the county of Winnebago to erect and build a jail for the use of the county. In the prosecution of the work, Allen made a contract with the firm of Hough & Co. to furnish all the material, manufacture and deliver in proper position all the wrought iron work for such building, the cost of which w'hen completed would amount to a large sum of money, to be paid in installments as the work progressed. In consideration of making the agreement, complainants guaranteed the faithful performance of the same on the part of Allen. After the contractors had delivered a large amount of the iron work and placed a considerable portion of it in position, an objection was raised by the building committee, by Allen and the architect in charge of the building, that the iron work furnished was not in compliance with their contract with Allen, nor in compliance with Allen’s contract with the county, and the contractors were forbidden to proceed further with the execution of their contract. Suit was brought by the contractors against complainants on their guaranty of Allen’s contract, in the United States Circuit Court, in which they claimed a large sum of money to be due to them for materials furnished and work done under their contract with Allen, which he refused to pay. On the trial of that cause a judgment was rendered against complainants for a large sum of money, which was afterwards affirmed in the Supreme Court of the United States. That judgment, with costs and attorney’s fees, complainants were compelled to pay, and did pay and discharge, whereby Allen became indebted to them in a large sum of money. Concerning these facts there is no disagreement between the parties. On the 1st day of November, 1866, Allen purchased of Ephraim Sumner the lots which are the subject of this litigation, and received a bond or agreement for a deed when the purchase money should be fully paid. The contract price was $700. There had been paid and indorsed on the contract $500, and under the date of April 1,1871, by writing on the contract signed by the respective parties, it was stipulated there was due on such contract $495.30. On the 24th day of July, 1871, John Allen assigned and transferred all his interest in the contract with Sumner to the Rockford National Bank. The bill in this case is framed on the theory that the guaranty of complainant of the contract of Allen with the iron contractors, although it bears date the 18th day of July, 1871, was not, it fact, signed until the 24th day of the same month, and at the time of signing such guaranty John Allen, as security therefor, and as security for their guaranty of his contract with the county, assigned his contract for a deed with Sumner to complainants and delivered it to one of them, but by inadvertence on the part of the clerk writing the assignment, the Rockford Rational Bank was named as assignee instead of one of the complainants. After John Allen had assigned the contract with Sumner to the bank, either he or his son, Thomas Allen, made improvements on the property to an extent that made it valuable, so that it produced a considerable income. Complainants tendered Sumner the amount they allege was due him for the balance of the purchase money on his contract with Allen, and demanded a deed for the property, and then brought this bill, in Avhich they claim they are entitled to a conveyance of the premises from Sumner, and to have |the lots sold by reason of the assignment to the bank, Avhich they allege Avas for their benefit, to reimburse them for the money they were compelled to pay on account of their guaranty of Allen’s contract Avith the iron contractors, and asked that a receiver be appointed to collect the rents pending the litigation. The circuit court decreed the relief sought, and that decree Avas afterwards affirmed in the Appellate Court. One objection is taken in this court that I consider fatal to the present decree. It appears that John Allen, prior to May 10, 1869, Avas adjudged a bankrupt in the District Court for the Rorthern District of Illinois, in which the land is situated, and the deed of one of the registers in bankruptcy of that court was given in evidence, conveying and assigning to Ira R. Curtis, assignee of John Allen, all the property, both real and personal, of Avhatsoever nature or description, in Avhich the bankrupt had any interest prior to the 30th of December, 1868. Although the contract Avith Sumner is in the name of John Allen, it is a matter of contention whether it in fact belonged to him or to Thomas Allen. Be that as it may, the bill proceeds on the ground the property embraced in the contract with Sumner belonged to John Allen, and that the claim to it put forth by Thomas Allen AA'as fraudulent as to the creditors of the former. As was said in Harris v. Cornell, 80 Ill. 54: “The Bankrupt act, proprio vigore, dtested the bankrupt of all his properfcv rights, and vested them in the assignee, who thenceforth held the absolute title to it, and no principle is better settled than this, that a party holding the legal title to property which is made the subject of judicial investigation is a necessary and an indispensable party to such proceedings.” Conceding that John Allen was the owner of the property embraced in the contract with Sumner, which complainants must do to obtain any standing in court, then as he was declared a bankrupt long before the assignment of the contract to complainants, or to the bank for them, the assignee was a necessary and indispensable party to a proceeding concerning the title to the property, that it might be judicially determined whether the bankrupt at the time of the alleged assignment had any interest in the property which he could assign to complainants, or to the bank for their benefit. Adopting the theory on which the bill is framed, that the contract with Sumner was made with. John Allen, and for his benefit, and not for the benefit of his son, Thomas Allen, then it follows logically that the equitable title he acquired to the property under that contract passed to his assignee in bankruptcy, aqd at the time of the assignment he had no interest in the contract or property that he could assign to any one. The Limitation act, Rev. Stat. United States, page 982, section 5057, can have no application to a case like the one before us. Phelps v. McDonald, 99 U. S. Rep. 298. The decree presents a case where the court takes the title to the property and places it in one who is an entire stranger to that title and in no way connected with it. I am familiar with no principle upon which this can be ° rightfully done.