Paulick v. National Bank of Republic

279 Ill. App. 160, 1935 Ill. App. LEXIS 85
CourtAppellate Court of Illinois
DecidedFebruary 13, 1935
DocketGen. No. 37,371
StatusPublished
Cited by4 cases

This text of 279 Ill. App. 160 (Paulick v. National Bank of Republic) is published on Counsel Stack Legal Research, covering Appellate Court of Illinois primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Paulick v. National Bank of Republic, 279 Ill. App. 160, 1935 Ill. App. LEXIS 85 (Ill. Ct. App. 1935).

Opinion

Mr. Presiding Justice Hebel

delivered the opinion of the court.

The plaintiff is here on appeal from a judgment in favor of the defendant and against the plaintiff for costs entered by the court upon the verdict of a jury. The action is in assumpsit and was filed in the municipal court of Chicago by the plaintiff, seeking to recover from the defendants the sum of $3,614.10, based upon the rescission by the plaintiff of a sale to him of stock of the National Bank of Republic, a corporation, upon the ground that the plaintiff was induced to enter into the transaction with the defendants by fraud and misrepresentation.

The plaintiff alleges in his statement of claim that on November 24,1930, and for many years prior thereto, he and the Dearborn Class Company were customers and depositors of the National Bank of Republie; that the plaintiff frequently consulted the officials of the bank with reference to financial and banking advice, and reposed implicit confidence in the defendant and its officers.

It is further alleged in the statement of claim that on November 24, 1930, plaintiff was extended a special invitation by the defendant bank to purchase its shares of stock; that the defendants then and there represented to him that (1) the National Bank of Republic was then negotiating for a large merger; (2) that the National Bank of Republic was offering a limited number of its shares, in advance of said merger, to a few only of its select customers so as to demonstrate its appreciation for their past business, and that plaintiff was being regarded as one of such customers; (3) that the then actual book value of said stock was over $200 per share; (4) that the stock was earning in excess of $15 per share; and that after the merger had' been completed, the value of the same stock would be about $500 per share; that by reason of said representations and confidence, plaintiff was induced to and did purchase from defendants, 50 shares of stock for $4,950; that, thereafter, about July 15, 1932, he discovered for the first time that all the foregoing representations were false and untrue, notified defendants of his election to rescind and demanded the return to him of $3,614.10, which he had paid on account of the said purchase price.

Each of the defendants filed a separate affidavit of merits. The defendant National Bank of Republic admitted that plaintiff had been a customer of the bank, but denied that it made through its officer Mentz any false statements relative to the value of the stock bought by the plaintiff from Otte & Company, a corporation, and further denied that it received any money from the plaintiff; and denied that it made through any of its officers or agents any statements to the plaintiff. Otte & Company, a corporation, one of the defondants, admitted that the plaintiff had contracted with it for the purchase of the shares of stock in question, but denied that it made any statements to the plaintiff relative to the value of the stock. All the defendants denied that there was a privity of contract between the parties, and denied that any false statements were made to the plaintiff, and that Otte & Company, one of the defendants, admitted that it received money from the plaintiff.

Upon the trial of this cause, the plaintiff and Robert R. Mentz, an officer of the defendant bank, were the only witnesses who appeared and testified. The plaintiff testified that when he appeared at the bank on November 24, 1930, upon invitation, Mentz stated to him the book value of the stock was $200 per share; its earnings in excess of $15 per share, a merger was pending, and the sale was open to only a few good customers of the bank. Plaintiff’s Exhibit 1, which is in evidence, shows the book value at the time and the earnings of the stock at the date of the sale, to be $37 and $4.50 per share, respectively. The plaintiff also testified that he purchased the stock from Otte & Company, and what money he paid for the stock was paid when he purchased the same through Otte & Company.

Mentz, when called as a witness, testified he was employed by the National Bank of Republic, of Chicago, and that he told the plaintiff the market price of the stock at the time was approximately $100 a share, the book value approximately $40 a share, the earnings $4 to $5 a share, and the dividends $3.20 per share, but denied that he told the plaintiff the National Bank of Republic of Chicago was then negotiating a large merger, and the then book value of the stock was $200 per share, or that the stock was earning in excess of $15 per share, and denied he stated to him that after the contemplated merger the stock would be worth about $500 per share.

The jury were instructed orally by the court at the close of the hearing, and returned a verdict for the defendants. The court entered judgment on the verdict after denying the motion for a new trial entered by the plaintiff.

The plaintiff contends that there was manifest and prejudicial error in the charge by the court to the jury that the burden was upon the plaintiff to prove the fraud alleged against the defendants by such clear and convincing evidence that the minds of the jury were well satisfied, beyond doubt, that the fraud in issue was true. In support of his contention he states the rule of law that controls in actions of fraud and misrepresentation, whether at law or in equity which is, where the plaintiff proves that the contract in question was executed during the period of a fiduciary or confidential relationship, such transaction is prima facie voidable. The burden of proof thereupon rests upon the defendant in whom confidence has been reposed, to show by clear and convincing evidence that the contract in question was fair, equitable, beneficial to the plaintiff, and was not against good conscience. Citing a number of cases.

The defendant, however, in reply, contends that where no special objections were made to the instructions, or any part thereof at the time they were given, complaint cannot be made that the trial court erred in its oral instructions, and that no objection having been made by the plaintiff to the giving of the instruction before the jury retired for the purpose of considering a verdict, the plaintiff is not now in a position to complain.

Defendants raise the point that objections should have been made to the instructions of the court by the plaintiff before the jury retired to consider its verdict, as required by the rule of the municipal court, which provides that objections must be made in order that the court may make corrections or modify the instructions already given. The plaintiff contends however that this rule is not before this court, for the reason that it is not incorporated in the record, and before this court can consider such rule it must be a part of the record. Plaintiff’s contention is well founded, unless the Appellate Court can properly take judicial notice of the rules of a court of inferior jurisdiction upon an appeal or writ of error, provided for by statutory rule. From an examination of the statute of this State, we find the Legislature in 1931 amended par. 58, ch. 51 (Cahill’s Ill. Rev. St. 1933) of an act entitled “Judicial Notice” which is as follows:

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Bluebook (online)
279 Ill. App. 160, 1935 Ill. App. LEXIS 85, Counsel Stack Legal Research, https://law.counselstack.com/opinion/paulick-v-national-bank-of-republic-illappct-1935.