Mr. Presiding Justice O’Connor
delivered the opinion of the Court.
By this appeal the Chicago Title & Trust Company, as receiver of the La Salle Street Trust & Savings Bank, seeks to reverse a decree of the circuit court of Cook county whereby the Central Trust Company of Illinois was decreed to pay to the receiver $79,189.42, with interest thereon at the rate of 5 per cent per annum from September 24, 1915, together with certain costs.
The record discloses that on a former trial between the same parties the Central Trust Company was- decreed to pay to the receiver $1,487,854.16. From that decree an appeal was talien to the Supreme Court of this State where the decree was reversed and the cause remanded with 'directions to refer the matter in controversy to a master in chancery. Golden v. Cervenka, 278 Ill. 409. Pursuant to the directions of the Supreme Court the matter was referred to a master in chancery to take the evidence and to make up his report. By the decision of the Supreme Court it was held that if the authorized capital and surplus, $1,250,000, of the La Salle Street National Bank was impaired at the time its assets were transferred to the La Salle Street Trust & Savings Bank, October 21, 1912, the Central Trust Company was liable to the creditors of the Trust & Savings Bank to make good such deficiency. And it was further held that upon such hearing before the master the hnrden of proving the value of the capital stock would rest upon the Central Trust Company. Pursuant to such directions the matter was referred to a master in chancery. During the pend-ency of the suit the receiver, William C. Niblack, died, and the Chicago Title & Trust Company was appointed in his stead. The latter company prosecutes this appeal claiming that the evidence taken before the master showed that the capital and surplus of the National Bank on October 21, 1912, was entirely lost and, therefore, the Central Trust Company should have been decreed to pay to the receiver $1,250,000, being the authorized amount of the capital and surplus of the National Bank, together with interest thereon at the rate of 5 per cent per annum from September 24, 1915. On the other hand, the position of the Central Trust Company is that the evidence in the record shows that on October 21, 1912, there was no impairment of the capital and surplus of the National Bank and, therefore, it was error for the circuit court to decree that it pay to the receiver any amount, and on this ground the Central Trust Company assigns cross errors, properly bringing their contention before this court for decision.
The record is extremely voluminous. The evidence talien before the master consists of 13,571 pages. The master’s report, together with exceptions thereto, contains 525 printed pages. The receiver has filed a printed argument of 931 pages, and the Central Trust Company’s brief and argument contains 1875 pages. The history of the National Bank and of the Trust & Savings Bank is set forth in the opinion of the Supreme Court, so that it will not be necessary to state more than a few of the facts in that regard here. Under the decision of the Supreme Court there was but one question to determine on the retrial of the case, and that was to find the value of the net assets of the National Bank as of October 21, 1912. These assets were made up of a great number of items, of which more than 200 are controverted and discussed in the 1 printed arguments here. In placing a value on these 200 items as of October 21, 1912, it was necessary for us to examine the evidence of a great many separate businesses and enterprises. For example, if a promissory note was in the National Bank on the date in question, to determine whether that note was of value at that time, of course, we had to investigate the assets and liabilities of the maker, and if the maker was engaged in various lines of business, and had interests in other businesses, it was - necessary to go into each of these to see what assets and liabilities he had on that date to determine the value of his paper. We simply make reference to these matters here because we find it necessary that our opinion should be of great length. In addition to investigating the facts, about 15 questions of law are also argued. But since we have decided that it is necessary for us to examine the evidence with reference to each contested item of assets, we think it proper to discuss such evidence and the law in passing on each of such items separately, and, therefore, it will only be necessary here for us to pass generally upon the contentions of the respective parties. '' ■,
The Central Trust Company contends that the decree of the circuit court, confirming the master’s report, is conclusive as to the controverted questions of fact because the evidence on the questions of the value of certain items (and this was the only.question to be determined) was conflicting. And further, that since the cause was referred to a master who had seen and observed the witnesses testifying, his findings would not be disturbed unless clearly and manifestly against the weight of the evidence. Of course, under the láw, the decree of the circuit court is not conclusive on this court, but it is our duty to examine the evidence. The master’s findings are only prima facie correct—of an advisory nature only. The facts are all open for the consideration of the chancellor in the first instance, and afterwards by the Appellate or Supreme Court in case of an appeal. It is only where the chancellor has heard the evidence that we will refuse to disturb his findings, unless they are clearly and manifestly against the weight of the evidence. The master’s report is not given the same effect as the verdict of a jury in a case where a jury trial is a. matter of right. Larson v. Glos, 235 Ill. 584; Kelly v. Fahrney, 242 Ill. 240. Under the law, therefore, the only way this case can properly be decided is by a most careful consideration of the evidence. The Central Trust Company contends, however, that upon an examination of the evidence it will be found that the master is sustained by the overwhelming weight of the evidence, and that the decree should, therefore, be affirmed. These questions of law contended for by the Central Trust Company make little or no practical difference in this case, for we substantially agree with the master as to almost every proposition of law which he announces in his report. But we do differ from him in the application of the law to the facts, as found, as to many of the items of assets, which are hereinafter set forth in detail.
There is some complaint that the master admitted evidence of facts occurring after October 21, 1912, on the ground that under the decision of the Supreme Court, facts occurring subsequently are of no importance. We think this is a misapprehension of that decision. The opinion there is specific that the question for determination upon a retrial of the case is the value of the assets of the National Bank on October 21, 1912, and, of course, any evidence that would tend to throw light on this subject was admissible, whether evidence of facts occurring- before or after that date. The evidence could not be limited to any specific period of time. But the test is, would such evidence tend to prove the value of the particular asset bn October 21, 1912.
The National Bank commenced business on May 7, 1910, and conducted its bank in Chicago until October 21,1912, when its assets were turned over to the Trust & Savings Bank. The latter bank continued to operate until June 12,1914, when it was closed by the Auditor of Public Accounts of this State and a receiver appointed. A great many items of assets in the National Bank on October 21, 1912, were paid in whole or in part to the Trust & Savings Bank after that date. A number of other items came to the receiver, and as to some of them he succeeded by set-offs, compromises and otherwise in securing partial or full payment. And in all of such cases the master allowed the amount obtained in computing the impairment of the capital and surplus of the National Bank. He did so, as stated by him, on the theory that these amounts obtained by the receiver tended to show value of the particular item as of October 21, 1912, and it is strenuously argued by counsel for the receiver that in most of these instances the master was wrong; that where it appears from the evidence that certain notes in the bank on October 21, 1912, were renewed from time to time and partial payments made, and' there being no evidence of the financial responsibility of the maker of the note as of October 21, 1912, no credit should be allowed for such payments. He further contends that, of course, no value should be given where the receiver was required to resort to suit to enforce collection. There is a great deal of argument on this question by counsel for both parties, and we have given it most careful consideration. We have come to the conclusion that under the record in this case and the opinion of the Supreme Court, value should be given in every case where payment has been made, as this would tend to prove value as of October 21, 1912. But even if it might appear that the evidence did not indicate value as of that date, we think that wherever payment has been made value should be given by virtue of such payment itself. Of course, where the evidence shows that expense has been incurred in making any collection, that expense should be deducted from the amount collected before crediting the assets of the National Bank.
The receiver, in his cross-bill on which he bases his cause of action, alleges that the National Bank for more than six months prior to October 21, 1912, was in an unsafe condition, “its capital stock and surplus having been theretofore entirely lost and its assets not then being more than sufficient in value to satisfy its then liabilities to its creditors.” Counsel for the receiver, on the first trial, put in evidence statements prepared by Hiram B. Kadish, an expert accountant who had examined the books and papers of the National Bank and prepared a large number of statements summarizing the indebtedness to it and its condition at the close of business on October 21, 1912. The decree of the circuit court entered on that trial found that the capital and surplus of the National Bank were entirely lost on that date. An examination of the receiver’s brief filed in the Supreme Court on the appeal of that case shows that the statements prepared by Kadish gave credit for the amount of the collections made by the receiver. And counsel for the receiver there contended that even though credit be given for such collections, the capital and surplus were shown to have been entirely lost. On the other hand, counsel for the Central Trust Company there contended that if Kadish’s figures could be regarded as representing the actual status of the bank, they would indicate that the impairment of the capital stock was $600,000 only, leaving a surplus of approximately $400,000. On that presentation the Supreme Court held that Kadish’s statements did not show that the capital was entirely lost on October 21, 1912, but that they would indicate there was still a value of $400,000. In speaking of this question, and referring to the statements prepared by Kadish, the Supreme Court, speaking through Mr. Justice Dunn, beginning at p. 431, said: “The statement of the national bank on October 21, 1912, shows its capital stock, surplus and undivided profits to be $1,267,815.72. Whether or not this amount had been impaired depends upon the collectibility of the loans which constituted a large part of the resources of the bank. In regard to this, Kadish presented a statement showing bills receivable held by the National Bank on October 21, 1912, which remain unpaid in the Trust and Savings Bank, or were transferred by it to other banks and remain unpaid, or for which other paper which still remains unpaid was substituted, and showing the accounts paid to the receiver allowed as set-offs and obtained by compromises.” Continuing, the court said that the statement showed amounts “which the receiver collected in cash, by set-offs and compromises, in the sum of $161,064.61, leaving a net amount according to this statement, of $748,242.43. Counsel for appellants (the receiver) ■* * * Say that if these figures could be regarded as accurately representing the impairment of the stock and surplus of the National Bank, they would indicate that the impairment of the capital stock was only tq the extent of about $600,000, still leaving $400,000 of value. These figures certainly do not sustain a finding that the capital stock and surplus of the bank had been entirely lost and that the value of its assets was not sufficient to satisfy its liabilities to its creditors.” From the foregoing, therefore, it clearly appears that on the former trial the receiver took the position that an allowance should be made for all set-offs and moneys obtained by the receiver by compromises, and having there taken such position both at the trial and in the Supreme Court, and the Supreme Court having decided the case on that theory, he ought not now on a retrial of the case be permitted to shift Ms position and say that no allowance should be made for such set-offs or compromises. However, we are of the opinion that in the equitable situation before us, it is only just and proper that allowances be made for any payments made to the Trust & Savings Bank, and for any set-offs and other moneys obtained by the receiver from the assets of the National Bank. Under the Supreme Court opinion the Central Trust Company was held liable on the ground of estoppel, and not on the ground that it had done an intentional wrong. The Supreme Court said in the Golden case (p. 427): “It is also immaterial whether the Central Trust Company or Dawes had any fraudulent intention, knew anything about the condition of the National Bank, or made any profit out of the transaction. The trust company is estopped, as against creditors who had a right to rely upon the auditor’s certificate, to deny that the cash exhibited was the property of the Trust and Savings Bank, for which the trust company must account as a part of the bank’s capital. The receiver, who represents the creditors as well as the stockholders of the bank, may in equity require the restoration of the fund for the benefit of the creditors.” We think the Central Trust Company and Dawes acted entirely innocently in the matter, and were doing a mere act of courtesy for Lorimer and his bank. There is no contention that the Central Trust Company or Dawes received any remuneration for what was done. The matter of organizing the Trust & Savings Bank and the turning over of the assets of the National Bank to it was all fully explained to the officials of the State banking department, and everyone connected with the matter seems to have acted in entire good faith. .They all thought that what they were doing was a substantial compliance with the law of this State. We had occasion to consider this question in another phase of this case in Golden v. Cervenka, 216 Ill. App. 397, where we said (p. 402): “We think it clear that neither the Central Trust Company nor its officers in the transaction had any idea that they were violating any provision of the law, as it appears that the entire transaction was explained and the facts known to the representative of the auditor’s office. In fact, we think that everybody concerned in the matter thought that what they were doing was in substance a compliance with the law.” And we there further said that the Central Trust Company did (unwittingly) a legal wrong. And after a most thorough examination of the record before us we are confirmed in the statement we there made. In these circumstances, we think it would be highly inequitable and not within the opinion of the Supreme Court to refuse to consider payments made to the Trust & Savings Bank and moneys obtained by the receiver. But counsel for the receiver further contends that under the opinion of the Supreme Court no credit for moneys obtained from the assets of the National Bank, by the Trust & Savings Bank or its receiver, should be considered in valuing the assets of the National Bank as of October 21, 1912, unless such payments would indicate value of such assets in the opinion of prudent bankers. And in this connection, the language of the Supreme Court (beginning at p. 432) is pointed out: “The solvency of the bank on October 21, 1912, is not, however, to be determined by the condition of the assets of the Trust and Savings Bank on June 11, 1914. The question is not what was the value of the assets of the bank, as ascertained by their final collection, but what was the value on the date of the transfer. If upon an examination of the bank at that time, in the judgment of prudent bankers familiar with the credit of the debtors, the value of the loans of the bank was equal to the amount at which they were carried on the books of the bank, the capital of the bank cannot be regarded as impaired at that time because it eventually turned out that a portion of the loans could not be collected.” This language was used after the court had disposed of the question whether the capital stock had been entirely lost, and, in connection with this, it allowed the amounts collected and obtained by the receiver. So that it appears from the opinion of the Supreme Court that after making an allowance for moneys obtained from the assets of the National Bank after October 21, 1912, that court turned to consider another proposition which they foresaw might arise on a retrial of 'the case, viz., that some notes and other assets of the National Bank on October 21,1912, might then be perfectly good and collectible, and later the makers' of such notes, and other debtors of the National Bank, be unable to pay their obligations. Of course, if assets of the National Bank on October 21, 1912, were then of value but afterwards became worthless or of little value, no one would contend that the Central Trust Company would be in any way liable for a failure to collect such assets.
Counsel for the receiver also contends that where the evidence shows any item of asset in the National Bank on October 21, 1912, was then good but subsequently through the failure of the officers of the Trust & Savings Bank to collect such item, or through the dishonesty of such officials the assets were dissipated and rendered worthless, the Central Trust Company should be held liable, for the reason that the Central Trust Company occupies no better position than the officers and directors of the Trust & Savings Bank. With this contention we cannot agree. We are of the opinion that the liability of the Central Trust Company could in no way be affected by any dereliction or wrongdoing of the officers of the Trust & Savings Bank.
We do not agree with the contention of counsel for the Central Trust Company wherein he argues that credit should be given for those items which the evidence shows would have passed the scrutiny of prudent bankers and no credit was given by the master, for it appears from the evidence that as to such items the bankers were not cognizant of all the facts. And we are clearly of the opinion that even if an item of asset in the National Bank was actually approved by prudent bankers, no allowance should be made if the evidence showed that such item was worthless. In fact, the record discloses that there are but two or three items in the entire record concerningwhich prudent bankers testified. Neither do we think'th^t the fact that some bank examiners, who made an examination of the National Bank some few months prior to October 21, 1912, and who did not think the bank then insolvent, is material here, because the liability of the Central Trust Company does not depend upon the good faith of the parties to the transaction.
Counsel for the Central Trust Company insists that where the evidence shows that debts due the National Bank were later merged in the liabilities of another debtor and that payments were made upon the latter, such payments extinguished pro tanto the earliest indebtedness, nothing appearing to the contrary. And, further, that where a new note was given to procure a new loan and was discounted by the Trust & Savings Bank, and a check drawn against the proceeds thereof for the amount, this was a payment of the former note and not a renewal thereof. The first of these two contentions is based on the law as announced by Sir William Grant, master of the rolls, in Devaynes v. Noble, 1 Merivale 529. The rule there announced is as follows : In the case of. a banking account where all the sums paid in form one blended fund, of which the parts have no distinct existence, there is no room for any other appropriation of payment than that which arises from the order in which the receipts and payments take place. Presumably it is the first sum paid in that is first drawn out. It is the first item on the debit side that is discharged or reduced by the first item on the credit side of the account. The appropriation is made by the very act of setting the two items against each other. The master adopted this rule, but we think it has no application to the instant case. Wherever the evidence shows that a debtor of the National Bank on October 21, 1912, subsequently borrowed additional money from the Trust & Savings Bank and then paid his obligation, we think no credit should be allowed, because the assets, as of October 21, 1912, were not augmented by such payment. But where the evidence shows that payment was made by money from sources other than the Trust & Savings Bank, we have given credit accordingly. Nor do we think the substitution of a new note for one that was in the bank on October 21, 1912, can be taken into consideration in valuing the assets of the National Bank, where the new note has not been paid, no money being brought into the Trust & Savings Bank by virtue of such exchange. In these circumstances, certainly no consideration should be given to such matters in valuing the assets of the National Bank.
The Central Trust Company makes the further contentions that (1) the chancellor erred in overruling its motion for a decree in its favor notwithstanding the findings as to the value of the capital stock, for the reason that prior to the commencement of the suit the receiver should have tendered to the Central Trust Company the bills receivable and other assets in his hands, which, or the successors thereof, were taken over by the Trust & Savings Bank from the National Bank, but which the receiver failed to do, and for the further reason that he failed, after the commencement of the suit, tfe take any action with respect to the undisposed bills receivable and other assets which, or the successors thereof, were so taken over by the Trust & Savings Bank, after first consulting with and obtaining the consent of the Central Trust Company; and (2) that to hold it liable in this case would be in contravention of section 1 of the fourteenth Amendment of the Constitution of the United States. Counsel for the Central Trust Company devotes many pages of his argument to these contentions, but in the view we take of the matter, we are of the opinion that we are i bound by the specific directions of the Supreme Court in the Golden case, and, therefore, these are questions we cannot consider here.
Counsel for the receiver contends that the books of the National Bank were not competent evidence to establish the value of any asset as against him. No complaint is made that the books were not kept in the regular order of business, nor that they were not accurately kept. We think that they were competent, and we have treated the entries as making out a prima facie case, unless other evidence was introduced to show that, for instance, where they purported to show payment, there was such a course of business dealings as would indicate that the transactions were mere bookkeeping entries, and in no such instance have we given value to any asset without further evidence. Since we will, in this opinion, consider each item of assets, giving the facts, as shown by the evidence, and our conclusions under the law applicable, we think nothing further should here be said, but we proceed to the several items of assets and liabilities, as follows :
(Here follows a discussion of each item of asset and liability of the bank, covering 312 typewritten pages of the opinion, omitted by direction of,the court.)
Pursuant to the foregoing, we find the assets and liabilities of the La Salle National Bank as of October 21, 1912, to be as follows:
A QCSA'fcS
(1) Cash ...........................$ 231,555.91
(2) Exchange for Clearing House .... 47,386.36
(3) Redemption in U. S. Treasury.... 32,500.00
(4) Due from National Banks.......,. 313,305.46
(5) Due from State Banks........... 151,010.01
(6) Accrued interest on amounts due from National and State Banks. 206.09
(7) Cash items .... 426.88
(8) Overdrafts ..................... 2,952.68
(9) U. S. Bonds to secure circulation.. 658,018.75
(10) Bonds to secure postal savings deposits .............. 78,409.76
(11) Other stocks and bonds ..... 187,115.88
(12) Furniture and fixtures.......... 5,950.00
(13) Loans and discounts............. 1,964,583.89
(14) Funds in transit................ 166,938.18
(15) Bank building acc’t.............. 25,000.00
Total ........................$3,865,359.85
Liabilities.
(1) Individual deposits..............$1,852,969.64
(2) Accrued interest on individual deposits ........................ 941.51
(3) Savings deposits ................ 109,903.36
(4) Accrued interest on savings deposits ..............'.......... 720.00
(5) Postal savings deposits.......... 58,011.89
(6) Accrued interest on postal savings deposits ...................... 425.05
(7) Due National Banks............. 192,886.52
(8) Due State Banks........ 200,768.70
(9) Accrued interest on amount due National and State Banks...... 468.96
(10) Time certificates of deposit....... 98,727.50
(11) Accrued interest on time certificates • of deposit .................... 683.78
(12) Demand certificates of deposit.... 4,000.00
(13) Accrued interest on demand certificates of deposit .............. 6.01
(14) Marginal certificates of deposit... 27,500.00
(15) Accrued interest on marginal certificates of deposit ............ 15.79
(16) Cashier’s checks ..... 41,461.93
(17) Certified checks ............. 50,440.32
(18) Expense vouchers.......'........ 39.25
(19) Circulation ..................... 647,495.00
(20) Circular expenses............... 2,109.89
(21) Certain liabilities not shown on the books .........'............... 3,254.43
(22) Personal property taxes ......... 6,000.00
(23) Liability to non-consenting stockholders ...................... 53,250.00
(24) Legal fees..............■........ 500.00
Total ........................$3,352,580.39
Therefore, the net value of the assets of the National Bank as of October 21,1912, being’ the difference between $3,865,359.85 and $3,352,580.39, is $512,779.46. Prom this it follows that the impairment of the capital and surplus of the National Bank, as of October 21, 1912, being the difference between $1,250,000 and $512,779.46, is $737,220.54.
Prom this it, therefore, follows that the Central Trust Company is liable for the $737,220.54, with interest thereon at the rate of 5 per cent per annum from September 24, 1915, to this date, April 5, 1922, which is $240,808.57, making the aggregate amount of the liability of the Central Trust Company $978,029.11.
The chancellor, in entering the decree, found from the admissions of counsel in open court that the taxable costs of the receiver were $16,203.52, and the taxable costs of the Central Trust Company were $15,957.12, and it was decreed that the receiver pay one-third and the Central Trust Company two-thirds of these costs. The receiver contends that no part should be taxed against him on the ground that the litigation was made necessary by the wrongful act of the Central Trust Company. In our opinion, the contention of the receiver must be sustained. The record discloses that the Central Trust Company was held to be liable to restore to the Trust & Savings Bank $1,250,000, on the ground that it was estopped from contending that this money was not the money of the Trust & Savings Bank. The Supreme Court further held that the creditors, only, of the Trust & Savings Bank could complain, and if it appeared that the assets of the National Bank, which were turned over to the Trust & Savings Bank on October 21,1912, were equal to $1,250,000, then the creditors could not complain and the Central Trust Company would not be required to restore any amount; and, further, that the liability of the Central Trust Company should be credited to the extent of such value as it could be shown the net assets of the La Salle National Bank had on October 21, 1912. It was also held that upon the trial of this issue the matter should be referred to a master in chancery to take proofs, and the burden of establishing the value of such assets was placed upon the Central Trust Company. To meet this burden, the Central Trust Company necessarily introduced a great deal of evidence. The court costs in question were all substantially occasioned by the reference to the master. There is no claim that any evidence introduced by the receiver was unnecessary or improper. In those circumstances, we think it would not be equitable to require the creditors of the bank to pay any part of these costs.
We, therefore, are of opinion that the chancellor erred in failing to decree that the Central Trust Company pay the costs which the receiver incurred, viz.. $16,203.52.
For the foregoing reasons, the decree of the circuit court of Cook county is modified as to the amount the Central Trust Company is required to pay to the receiver and as to the payment of costs, and the Central Trust Company is here decreed to pay to the receiver the sum of $978,029.11, together with the further sum of $16,203.52, costs. In all other respects the decree of the circuit court is affirmed.
Since the amount that the Central Trust Company was decreed to pay in the circuit court Avas increased in this court by substantially $650,000, we think the costs in this court should likewise be borne by the Central Trust Company.
Decree modified and affirmed.