People Ex Rel. Lowe v. Marquette National Fire Insurance

184 N.E. 800, 351 Ill. 516
CourtIllinois Supreme Court
DecidedFebruary 23, 1933
DocketNo. 21025. Reversed and remanded.
StatusPublished
Cited by31 cases

This text of 184 N.E. 800 (People Ex Rel. Lowe v. Marquette National Fire Insurance) 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
People Ex Rel. Lowe v. Marquette National Fire Insurance, 184 N.E. 800, 351 Ill. 516 (Ill. 1933).

Opinions

Mr. Justice Stone

delivered the opinion of the court:

This cause is here to review the decree of the superior court of Cook county disallowing solicitor’s fees for services rendered in the liquidation of the Marquette National Fire Insurance Company. That decree was affirmed by the Appellate Court for the First District, and the cause is here on certiorari.

The facts are not in dispute. On a petition filed in the superior court of Cook county by the Attorney General on request of H. U. Bailey, Director of Trade and Commerce, an order was entered on April 29, 1927, under the Insurance Liquidation act of 1925, (Smith’s Stat. 1925, chap. 73, par. 496,) directing that the affairs of the Marquette National Fire Insurance Company (hereinafter referred "to as the insurance company) be liquidated. By order of that court the director was appointed liquidator and authorized to take the necessary steps to liquidate the affairs of the company and to employ counsel and such other assistants as should become necessary to the performance of those duties. On an amended petition a new order for liquidation was entered on November 21, 1927. It approved the acts of the liquidator taken under the order entered on April 29, 1927, including the employment of counsel, and directed that Edward J. Hennessy, who had been appointed counsel under the previous order, be continued in that capacity and that such additional counsel as should become necessary might be employed. The liquidator was directed to enter .such suits as were necessary in connection with claims or assets of the company and to incur and pay all necessary reasonable charges, fees and expenses in connection therewith. He was by the order directed to make report of his acts from time to time. The court fixed the first day of February, 1928, as the date on or before which claims against the company should be filed, directed the liquidator to give public notice thereof, and ordered that claims not filed by that date should be barred from participation in the assets. The court also appointed a master in chancery of that court to hear evidence on reference concerning claims and to make report thereon. By the order the liquidator was declared vested with title to all property, contracts and rights of action of the company, as provided by the Liquidation act.

On April 28, 1928, the liquidator filed his first report. Due notice thereof was given and an order entered requiring all policyholders, creditors, claimants or other parties in interest to file objections thereto on or before the second of July, 1928. This report showed that the liquidator had had the constant assistance of Hennessy as counsel and had paid him fees amounting to $7500. No objections or exceptions were filed to the report. A second and like report showing among the acts of the liquidator the employment of Hennessy as counsel was filed on November 15, 1928. The court directed that objections thereto be filed by December 14, 1928'. No objections or exceptions were filed to this report. On March 5, 1929, the liquidator filed his final report, and April 25 following was fixed as date by which objections thereto might be filed. This report showed all receipts and disbursements from the date of appointment of the liquidator to January 31, 1929, including compensation paid to Hennessy for legal services. Objections to the payment of solicitor’s fees were filed by the Pioneer Fire Insurance Company, Frank B. Leonard and J. D. Monroe, of whom the first two named appear here as defendants in error and will be hereinafter designated as objectors. The basis of their objections was and is that the court was without power to authorize the employment of counsel or to allow or approve fees for legal services rendered the liquidator but that the Attorney General should have rendered all legal services required throughout the liquidation. On May 3, 1929, Bailey having resigned from the office of Director of Trade and Commerce, an order was entered discharging him as liquidator and all matters of his report were approved except as to the fees for legal services objected to. Bailey was succeeded by Leo H. Lowe as such director, and on that date the superior court entered an order appointing Lowe liquidator and transferring the matters of the liquidation to him. On the hearing on objections to Bailey’s report the evidence showed, without contradiction, that the services rendered by Hennessy were the usual and necessary legal services required in the liquidation of a defunct insurance company, and that the compensation up to that time paid, amounting to $17,500, was reasonable and proper in amount. Of the further unpaid claim of Hennessy for $5000, $4962.50 was shown, without controversy, to be reasonable and proper in amount. It was also shown on this hearing that the liquidator was advised by the' Attorney General that the latter was not required or authorized to furnish legal services in liquidating the insurance company’s estate. No issue was made of the reasonableness of the legal fees paid by the liquidator or allowed by him, as shown by his report, and no question of that character is raised here. No evidence was offered in support of the objections filed, the matter being presented on a pure question of law as to the authority of the liquidator to employ, or the superior court to authorize employment of, counsel. The evidence also shows, without dispute, that in the liquidation of the insurance company over 8000 miscellaneous claims were filed, 835 of which were for losses. A number of lawsuits in various parts of the United States were tried or otherwise disposed of. Sixty thousand policies were filed with the liquidator for return of premium. Domestic claims amounting to $1,190,990, and approximately $300,000 in European claims, were filed. There were re-insurance contracts in more than thirty different insurance companies involving claims for return of unearned premiums. The liquidation required more than two years, during which time the services of Hennessy as counsel for the liquidator were almost constantly required. These facts were found in the final decree of September 27, 1930, from which appeal was taken. The decree approved all disbursements of the liquidator except counsel fees and other small items not involved in this review. The superior court in its final decree held that it did not have power to authorize‘and direct the liquidator to employ counsel or pay him for his services or to approve the liquidator’s acts in so doing; that its order previously entered was void, and that such fees should be disallowed and as far as paid should be accounted for by the liquidator. The Appellate Court affirmed that decree on the ground of want of power in the superior court to authorize or allow counsel’s fees.

Counsel for objectors here say that it is the duty of the Attorney General to represent the liquidator in all legal matters arising out of the liquidation of an insurance company; that the statute is intended to so provide, and that if it does not, still such services are within the common law powers and duties of the Attorney General and the legislature cannot deprive or relieve him of them.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Grimes v. Saikley
904 N.E.2d 183 (Appellate Court of Illinois, 2009)
Obrien v. Jones
999 P.2d 95 (California Supreme Court, 2000)
Boozell v. Estate of Pine Top Insurance
686 N.E.2d 657 (Appellate Court of Illinois, 1997)
People Ex Rel. Hartigan v. E & E HAULING, INC.
607 N.E.2d 165 (Illinois Supreme Court, 1992)
People v. Pollution Control Board
404 N.E.2d 352 (Appellate Court of Illinois, 1980)
State ex rel. Olson v. Graff
287 N.W.2d 87 (North Dakota Supreme Court, 1979)
Iqbal Jafree v. Scott
372 F. Supp. 264 (N.D. Illinois, 1974)
People ex rel. Baylor v. Multi-State Inter-Insurance Exchange
299 N.E.2d 482 (Appellate Court of Illinois, 1973)
People Ex Rel. Knight v. O'BRIEN
240 N.E.2d 686 (Illinois Supreme Court, 1969)
People Ex Rel. Gerber v. Central Casualty Co.
226 N.E.2d 862 (Illinois Supreme Court, 1967)
Flanagan v. Knight
214 N.E.2d 557 (Appellate Court of Illinois, 1966)
Illinois v. Brunswick Corp.
32 F.R.D. 453 (N.D. Illinois, 1963)
Betts v. Village of Calumet Park
170 N.E.2d 563 (Illinois Supreme Court, 1960)
People ex rel. Day v. Progress Insurance Ass'n
130 N.E.2d 526 (Appellate Court of Illinois, 1955)
People Ex Rel. Gutknecht v. Chicago Regional Port District
123 N.E.2d 92 (Illinois Supreme Court, 1954)
The People v. Chi. Transit Authority
64 N.E.2d 4 (Illinois Supreme Court, 1945)
Winger v. Chicago City Bank & Trust Co.
60 N.E.2d 560 (Appellate Court of Illinois, 1945)
People Ex Rel. Benefit Ass'n of Railway Employees v. Miner
56 N.E.2d 353 (Illinois Supreme Court, 1944)
The People v. Ulrich
34 N.E.2d 393 (Illinois Supreme Court, 1941)

Cite This Page — Counsel Stack

Bluebook (online)
184 N.E. 800, 351 Ill. 516, Counsel Stack Legal Research, https://law.counselstack.com/opinion/people-ex-rel-lowe-v-marquette-national-fire-insurance-ill-1933.