Court Opinion

ID: 6974280
Source: CourtListenerOpinion
Date Created: 2022-07-24 02:08:10.443774+00
Date Added: 2024-06-11T16:08:55.197594
License: Public Domain

Mr. Justice Scott delivered the opinion of the court: On November 18, 1902, the receiver filed his report, which was approved and the receiver discharged by an order entered on that day, over the objection of Dalton, the defendant in the suit. Thereafter, on February 26, 1907, the order approving the report and discharging the receiver was vacated, and the question principally discussed in the briefs is whether the court had jurisdiction to enter the order of vacation. Prior to November 18, 1902, the cause had been referred to a master to take proof upon the issues raised by the pleadings, and in July, 1903, the master filed a report sustaining the defendant in every respect and recommending that the bill be dismissed for want of equity. The complainant’s exceptions to this report were overruled by the court and the report was approved on October 30, 1903. A decree dismissing the bill has not yet been entered and the original cause is still pending in the circuit court. After the master’s report had been so approved Dalton sued out a writ of error from the Appellate Court for the First District for the purpose of obtaining a reversal of the order of November 18, 1902, approving the receiver’s report and discharging him. The receiver appeared in that court by the same counsel who represent him now in this court, and succeeded in getting the writ of error dismissed on the ground that the order approving the report and discharging the receiver was interlocutory and not a final order, “and was therefore not appealable nor subject to review upon a writ of error.” (Dalton v. Zimmer, 131 Ill. App. 490.) No appeal or writ of error was prosecuted to review that judgment of dismissal. Appellant now contends that the order was final and appealable, and that this court is not bound by the judgment of the Appellate Court to which we have just referred. Whether we would be bound by that judgment if some person other than the appellant was here complaining that it was erroneous is immaterial. Zimmer having obtained that judgment and the circuit court and Dalton having acted thereon, Zimmer will not now be heard to say that it was erroneous. He cannot so play fast and loose with the courts. After the order of November 18, 1902, was set aside the court undertook to ascertain what the actual condition of Zimmer’s account was, his report having been lost. A rule was entered against him to show cause why he should not turn over to Dalton all the money and property that came into his hands. He obtained an extension of the time in which to answer and then paid no further attention to the rule. When the investigation of his lost report was referred to the master he appeared before the master only in response to a subpoena issued for him at the instance of Dalton. He then testified that he was unable to furnish a copy of the report or any receipts or other memorandum from which a statement of the account could be made up. The court then required him to turn over to Dalton all the money which he had received, ($4400,) together with interest thereon,—an aggregate of $5309. The amount for which he was finally committed was $2450, which amount is arrived at by disregarding the charge originally made for interest and giving Zimmer credit for $300 paid to the solicitor of complainant, to apply on his fees, and $1650 paid to his own solicitor and himself on account of solicitor’s and receiver’s fees,—an aggregate of $1950,—which, deducted from $4400, leaves $2450, which he was finally required to pay. In defending the rule to show cause why he should not be punished for contempt, Zimmer sought to show that the money had all been disbursed pursuant to orders entered by the court. There were no orders entered authorizing him to disburse sums other than the $1950 above mentioned, in pursuance of which it is shown that he made any payments. An order was entered authorizing him to employ a custodian and stenographer and to pay them out of the assets of the partnership, but that order was vacated five days thereafter and it does not appear that any money was ever paid pursuant thereto, nor does the record disclose facts from which it can be seen that he paid anything on account of the ordinary expenses of carrying on the business. His conclusions on that subject, stated in his answer, avail nothing. Dalton, in fact, made application in August, 1902, for an order on the receiver requiring him to pay the costs of conducting the business for the month of July, 1902, which was resisted, and that application never was disposed of. The course which the receiver pursued indicates a willful disregard of the rights of Dalton. He employed a solicitor in his capacity as receiver, who, while not a partner of the solicitor for the complainant, officed in the same suite of rooms with that solicitor. Upon occasion the receiver’s solicitor represented the complainant in proceedings before the master. In so doing the receiver’s solicitor was acting for his office associate, who was solicitor for the complainant. The period intervening the appointment of the receiver and the date upon which the original order of discharge was entered was but four months and seventeen days. No possible theory can be advanced upon this record that will explain the expenditure of $4400 by the receiver in any legitimate way during that period. There is nothing here to indicate that the lost report was in any proper way itemized, nor is there any evidence to show the existence of a single item for which the receiver might legitimately have had credit over and above the amount for which the court in this proceeding gave him credit. The receiver, appointed without notice, gave a bond in the sum of $1000 at the time of his appointment. Afterward, in August, 1902, he was required, upon the motion of Dalton, to give an additional bond of $3000 within three days. With this order he never complied. As a further reason why he should not be punished for contempt the receiver stated that he had no money or other property with which he could make the required payment, and it is argued that the court may not properly punish a receiver for contempt in failing to pay over money with which he is properly chargeable, if he does not, in fact, have the means with which to make the payment. In the first place, the receiver's inability is not satisfactorily shown by his answer. That document contains no detailed statement of his affairs, as it should do. His offer to submit to an examination is not less than an impertinence. If he decided to interpose a defense of insolvency, the answer should have been accompanied by such a showing as would, prima facie, have rendered an examination unnecessary. Had that showing been so made, the court could then, if it saw fit, have permitted counsel for Dalton to interrogate Zimmer with reference to the statements of the answer. We are satisfied, upon this record, that if Zimmer does not have this money it is because he has disbursed it improperly and unlawfully, when, if the law is as he successfully contended when the case was first in the Appellate Court, he might be called upon to account for it at any time before the cause was finally disposed of in the circuit court. Moreover, where, as here, a receiver has wrongfully converted or expended money in his hands and is proceeded against in the cause in which he was appointed for contempt on account of a failure to comply with an order to pay, inability to pay, resulting from the wrongful act, does not present a defense to the proceeding, and the receiver may be imprisoned for the contempt notwithstanding his inability to pay. Cartwright’s case, 114 Mass. 230. The decree appealed from was entered on May 31, 1907. Zimmer was thereby committed to the county jail of Cook county, there to remain charged with said contempt until “the expiration of twenty (20) days from this date, unless he shall sooner pay to John H. Dalton, the defendant in this cause, the said sum of twenty-four hundred and fifty dollars, ($2450,) as required by order of court entered in this cause on March 16, A. D. 1907, or unless he shall be otherwise released and discharged from imprisonment by due process of law.” Appellee has assigned cross-errors, and contends that the court erred in limiting the imprisonment to twenty days, and in this we think it is correct. The judgment of the Appellate Court and the decree of the circuit court will therefore be modified and the language last above quoted will be expunged from that decree, and in lieu thereof there will be inserted in that decree the words and figures following, to-wit: “He shall pay unto John H. Dalton, the defendant in this cause, the said sum of $2450, as required by order of this court entered in this cause on March 16, 1907, or until he is otherwise discharged from imprisonment by due process of law.” As so modified the decree of the circuit court and the judgment of the Appellate Court will be affirmed. Decree modified and affirmed.