Court Opinion

ID: 6968427
Source: CourtListenerOpinion
Date Created: 2022-07-24 01:58:03.230821+00
Date Added: 2024-06-11T16:08:42.141231
License: Public Domain

Mr. Justice Craig delivered the opinion of the court: It is insisted in the argument, on behalf of appellees, that the agreements upon which a recovery was had in the circuit court falls within section 130 of chapter 38 of the Revised Statutes, and is void. On the other hand, it is first claimed by appellant that under the stipulation of facts upon which the cause was tried the criminal statute is not involved and appellees cannot rely upon that statute as a defense. As has been seen, item 14 of the stipulation provides that “the power of the National Bank of Illinois, and that of William A. Hammond, its second vice-president, to enter into said contracts in its behalf is affirmed on the part of the plaintiff herein and is disputed on the part of the defendants.” Under this part of the stipulation the defendants had the undoubted right to rely upon any ground which would disclose a want of power on the part of the bank to enter into the contracts, and if the statute rendered the contracts void as gambling contracts, we perceive no reason why the bank might not rely on the statute as well as any other matter which might disclose a want of power. It is next contended, that the contracts in question are not gambling contracts and do not fall within section 130 of the Criminal Code,—and this is the principal question presented by the record. The section of the statute in question is as follows: “Whoever contracts to have or give to himself or another the option to sell or buy at a future time any grain or other commodity, stock of any railroad or other company, or g'old, or’forestalls the market by spreading false rumors to influence the price of commodities therein, or corners the market, or attempts to do so, in relation to any of such commodities, shall be fined not less than $10 nor more than $1000, or confined in the county jail not exceeding one year, or both; and all contracts made in violation of this section shall be considered gambling contracts, and shall be void.” It appears from the record that the National Bank of Illinois, at the time the contracts were made, had an authorized capital of one million of dollars and did a large commercial banking business. It also appears that the Auditorium bonds were not speculative bonds, but were in the banking community of Chicago recognized as good and valid staple securities, either for the loan of money or for the purchase and sale thereof; that the bonds mentioned in the contracts formed a part of a purchase of $50,000 by the bank, $15,000 of which remained in the possession of the bank as a part of its assets at the time the bank went into the hands of the receiver. It also appears that the contracts were made in good faith, and both plaintiff and W. A. Hammond, second vice-president of the bank, fully believed the bank was clothed with power and authority 'to make the contracts. It further appears plaintiff refused to purchase the bonds unless the bank would contract, in writing, to take them back at par, and interest, in case he desired to return them. These are the facts surrounding the transaction at the time the contracts in question were entered into between the bank and the plaintiff, and it is manifest that there was no intention on the part of the bank or the plaintiff, in making the contracts, to violate the criminal law of the State or to enter into a contract prohibited by law. Are the contracts in question, when properly construed, option contracts or gambling contracts, within the meaning of the statute? It may be conceded that the contracts in question purport to be a sale of $35,000 of five per cent bonds of the Chicag'O Auditorium Association at par and accumulated interest from the bank to the plaintiff, with an option to re-sell during the month of January, 1897, at the price paid, with interest; but when the different.parts of the contract are construed as a whole, the sale of the bonds may be regarded as a conditional sale, with the right reserved by plaintiff to return them during the month of January, 1897. Under the contracts the amount to be paid by the bank to the plaintiff in case he desired to return the bonds was the face value and interest on the amount which the plaintiff had paid, and interest from the time of payment. The obvious intention of the parties was to make a conditional sale, and the condition upon which the purchase was made was, that the bank should take the bonds back at the same price if within a specified time the plaintiff desired to return them. In other words, the bonds were turned over by the bank to the plaintiff at a certain stipulated price with the distinct agreement that the plaintiff had the right, during the month of January, 1897, to elect whether he would keep them or return them to the bank, and in case he concluded to return the bonds he was entitled to receive his money back, with interest. The transaction was one both reasonable and proper, and one not within or prohibited by the statute. Indeed, it contains no element of a gambling contract. ° There was here no contract to have or give, to himself or another, the option to sell or buy at a future time, within the meaning of the statute, but, on the other hand, the appellant, as a part of his contract under which the bonds were delivered to him, reserved the right, at and within a specified time, to return the bonds and receive back the money he had paid, and interest thereon. It is difficult to see how a contract of that character can be termed a gambling contract or. one that should be prohibited by law. Is it contrary to law or justice, or does it violate any rule of public policy, for a person to sell a horse, a cow, a promissory note or a bond for a specified sum and agree to take the article back within a given time for the same price? If it is, this contract might be condemned; otherwise not. A contract similar to the one involved here came before the court in Richter v. Frank, 41 Fed. Rep. 859, and the contract was held not to be within the statute. Schneider v. Turner, 130 Ill. 28, has been cited and relied upon by appellees as an authority that the contracts in question are within the statute, and void. The contract in that case, which was a mere option contract, was held to be within section 130 of the Criminal Code, but upon examination it will be found that the contract there involved was so different from the contracts in this case that the decision there cannot control here. In the case under consideration the plaintiff notified the bank, before he agreed to take the bonds, that he would not take them unless the bank would agree to take them back, and the bank agreed, as a condition upon which plaintiff parted with his money and received the bonds, that it would take them back in the following January at the same price, and we see no reason why the bank should not abide by its contract. It is, however, said in the argument that the memoranda were mere offers, made without consideration, whereby the bank offered to buy during the month of January, 1897, in which case, the bank having been placed in the hands of a receiver and the receiver having repudiated the offers upon his appointment and prior to acceptance, the offer was of no binding force or effect. The agreement entered into between the appellant, Wolf, and the bank, was, at the time the receiver was appointed, a valid subsisting contract, which fixed the obligations and determined the rights of the respective parties, and the receiver was clothed with no power to do any act which might impair the obligation of that contract. Chemical Nat. Bank v. Hartford Deposit Co. 156 Ill. 522; same case, 161 U. S. 1. As has been seen, the circuit court rendered judgment against the bank but declined to enter a formal judgment against the receiver. The court, however, entered an order requiring the receiver to certify the claim in judgment to the comptroller of currency of the United States, “to be paid by him in due course of administration of the assets of the said National Bank of Illinois.” This action of the court has been called in question by appellant by cross-errors assigned in the Appellate Court. The rule adopted by the circuit court is sustained by Merrill v. First Nat. Bank, 75 Fed. Rep. 148. We are inclined to the opinion, under all the facts of the case, no such error was committed in the rendition of the judgment as should call for its reversal. The judgment of the Appellate Court will be reversed and the judgment of the circuit court will be affirmed. Judgment reversed.