Burgess v. Badger

14 N.E. 850, 124 Ill. 288
CourtIllinois Supreme Court
DecidedJanuary 19, 1888
StatusPublished
Cited by20 cases

This text of 14 N.E. 850 (Burgess v. Badger) is published on Counsel Stack Legal Research, covering Illinois Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Burgess v. Badger, 14 N.E. 850, 124 Ill. 288 (Ill. 1888).

Opinion

Mr. Justice Scholfield

delivered the opinion of the Court:

The writing executed by 'Barker, Burgess and Badger, was -written and punctuated as follows:

“Whereas for want of an agreement in writing, there may 'be some misunderstanding as to the contract existing between -Joseph N. Barker, William T. Burgess and A. C. Badger in .regard to prosecuting certain suits in the interest of the estate of S. J. Walker in bankruptcy, this memorandum is made for the purpose of putting said agreement in writing as follows r The suits prosecuted under this contract are: The International Bank v. R. E. Jenkins, assignee Aug. Bauer v. Same;: R. E. Jenkins assignee v. Union Trust Go., Greenbaum & Foreman et al., and cross-suit; Eli Kinney v. Bauer et al., and the-agreement is that of whatever fees may be realized either under contracts with creditors of Sam’l J. Walker or from R. E. Jenkins assignee out of the funds received by said estate from or by reason of said suits, J. N. Barker is to receive one-fourth ; W. T. Burgess one-fourth and A. G. Badger one-fourth; A. C. Badger retaining the remaining one-fourth as a compensation for the raising of money which was necessary to carry the suits to the higher courts.
Jan’y IS, 1881. Joseph N. Barker,
W. T. Burgess,
A. C. Badger.”

The contention of Burgess is, that this is limited to unsecured creditors—that the word “creditors” is controlled by the-recitals, the immediate context, and the immediate surroundings, to the unsecured creditors of Walker; while the other-parties contend, and the lower courts held, that it extends to-secured as well as unsecured creditors. In our opinion this is-the correct construction. It is the rule, as contended by counsel for plaintiff in error, that where the words in the operative-part of an instrument are of doubtful meaning, the recitals-preceding the doubtful part may be used as a test to discover the intention of the parties and fix the meaning of the words. (Walker et al. v. Tucker et al. 70 Ill. 527.) But this does not mean that we shall look at the language of the recitals, alone. It simply means that we shall look at the-entire language,— that included in the recitals as well as that included in the operative part of the instrument,—and from the whole ascertain the intention of the parties.

The recitals, here, do not assume to describe or limit the scope of the undertakings of the parties. They say, in effect, that the writing is executed, because otherwise “there may be some misunderstanding as to the existing contract, between the parties, in regard to prosecuting the suits,” which are named in the operative part of the instrument, “in the interest of the estate of S. J. Walker in bankruptcy.” The word “estate,” in "this connection, clearly means property. Under no definition «an it be made to include creditors, and so, “in the interest of the estate of S. J. Walker in bankruptcy,” must mean, in the interest of the property of S. J. Walker in bankruptcy, and this includes all the property he had, and every legal interest -that he had in property to which creditors might resort for the payment of debts. “In the interest,” we can only understand its meaning benefiting, by extinguishing or reducing liens or ■other incumbrances. It would seem quite significant that it is said the suits are prosecuted in the “interest of the estate,” ■and not in the interest of the assignee in bankruptcy, or of ■creditors proving claims in bankruptcy, as we must assume would have been said if it had been intended. Being in the interest of the estate or property, the resulting benefit must ■necessarily be primarily for all having a right to look to that ■estate or property for the payment of debts, and ultimately for the owner. Manifestly, creditors secured by junior liens (especially where there was any question of the adequacy of their security,) upon property whereon prior liens were sought to be removed or reduced by prosecuting the designated suits, would be benefited thereby, and might, in many instances, more readily than general creditors, be expected to be willing to pay for services thus rendered. How the parties anticipated they would be paid for rendering this service “in the interest •of the estate in bankruptcy,” is not expressed in the recitals, but is left to be expressed in the operative part of the instrument. It must be obvious that they could only have anticipated they would be compensated by payments to be made ■by those to be benefited, and. that all that would be benefited would be willing to contribute in some measure proportioned to benefits. Those who would most certainly be benefited were what are spoken of as “secured creditors,”—not required to prove their claims in bankruptcy,—but whose security was inadequate unless prior liens, the subject of the designated suits, were removed or reduced. General creditors could have no interest in these suits unless the property involved would more than pay all liens upon it,—a contingency which, in fact, never happened. It would therefore have been, to say the least, extraordinary, that men fully informed, as were these parties, of the condition of Walker’s estate, and two of them, learned in the law, should have entered into a contract for the prosecuting of suits to remove or reduce prior liens upon property, which would certainly benefit junior lienors, but which could only, by a remote probability, benefit, materially, general creditors, with the expectation and understanding that their only compensation would be derived from general creditors.

Burgess admits, that punctuating the language of the operative part of the instrument one way, it will include seemed as well as unsecured creditors. Since, therefore, the language, as the instrument was written, was not punctuated at all, it would seem plainly to be required to be punctuated in this way, so as to give a reasonable, rather than an unreasonable, construction, as thus: “And the agreement is that of whatever fees may be realized either under contracts with creditors of Samuel J. Walker, or from R. B. Jenkins assignee out of the funds received by said estate from or by reason of said suits” etc. The word “creditors” not being qualified, includes, of course, junior lienors, as well as unsecured creditors. We do not think it of moment, that this construction makes certain words redundant, for it is impossible to adopt any construction which will not disclose some redundancy of language. It is, moreover, a familiar rule, that when the terms of an agreement are in any respect doubtful or uncertain, and the parties to it have, by their own conduct, placed a construction upon it which is reasonable, such construction will be adopted by the court. (People ex rel. v. Murphy, 119 Ill. 159.) And it is also, in such case, required, that the court place itself in the position of the contracting parties, the better to understand the language employed, in the sense intended by them. Wilson v. Roots, 119 Ill. 386, and authorities there cited.

We find no contradiction in the evidence in regard to the origin of the contract. Burgess and Barker, as attorneys at law, and Badger, as accountant and business agent, had become familiar with Walker’s affairs, and the character and extent of litigation in which he was involved.

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14 N.E. 850, 124 Ill. 288, Counsel Stack Legal Research, https://law.counselstack.com/opinion/burgess-v-badger-ill-1888.