Roeder v. Pipe

235 Ill. App. 89, 1924 Ill. App. LEXIS 117
CourtAppellate Court of Illinois
DecidedOctober 22, 1924
DocketGen. No. 7,755
StatusPublished
Cited by1 cases

This text of 235 Ill. App. 89 (Roeder v. Pipe) 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
Roeder v. Pipe, 235 Ill. App. 89, 1924 Ill. App. LEXIS 117 (Ill. Ct. App. 1924).

Opinion

Mr. Justice Crow

delivered the opinion of the court.

By this appeal it is sought to reverse a decree of the circuit court of Adams county dismissing the bill of appellants, seeking to recover from appellees damages for fraudulent sale of stock and for rescission of the purchase of stock growing out of the organization of the Mid-West Fire Insurance Company, a corporation. The original bill was filed May 15, 1922. After several demurrers had been sustained to the original and amended bills, the cause was tried on the sixth amended bill, answers and replications, on reference to a special master. The master found in favor of some complainants against some defendants. He did not find in favor of all the complainants against all of the same defendants. In his report he found some complainants were not entitled to recover at all, and that some defendants were not liable to any of the complaints. There were numerous objections to the report which, being overruled,. were ordered to stand as exceptions. The exceptions of complainants were overruled and those of defendants allowed by the court, and the bill dismissed for want of equity.

The amendments to the bill were numerous, often extensive and made by reference to page and line of the original and amended bills. This practice of amendment has often been condemned. The vice of such procedure is emphasized on appeal where pages, lines and words lose their identity on the printed page of the abstract and the typed page of the record. Appellants have inserted a printed bill at the end of the abstract which they say represents the correct state of the bill upon which the trial was had. We have carefully examined and compared it with the original and various amendments so far as we can correlate them, and are not satisfied it correctly represents the case as presented by the pleadings made during the progress of the trial and at the time of the exceptions. It is not a bill authenticated in the record. We have not, therefore, relied upon it but have endeavored to ascertain the state of the record when the cause went to the court upon the exceptions to the report of proofs and findings and recommendations of decree. This effort has been aggravated by the fact that the index to the abstract does not comply with rule 22 of this court. That rule requires all exhibits and documents to be indexed, described by their character, parties, date and number, so as to distinguish each from every other, and the page of the record where found, to be stated. Not one of them, though numerous and their importancé manifest, has been indexed. The record is in such confusion it has been difficult to find them. Extended exhibits have been inserted, not only out of the order in which they were probably introduced, but paged in the inverse order of the matter contained in them. Some exhibits are apparently in the record more than once.

Substantially the bill charges that in December, 1917, Frank H. Clark, John L. Pipe, Herman F. Jochem, J. H. VandenBoom, Jr., F. K. Carpenter, Philip J. O’Brien, Charles B. McKay, John S. Fraser, Louis C. Shriver, L. B. Hetherington, John T. Inghram, Elmer Lummis and John Gr. Thompson were promoters and organizers of Mid-West Fire Insurance Company, and were active in directing and bringing about the organization and its incorporation, and that William B. Powell and Charles Cottrell aided and assisted in the organization, as agents of the promoters; that they jointly solicited complainants as such agents to subscribe for stock; that said solicitations were made before the company was organized and while in the stage of promotion; that the company was incorporated October 4, 1919, and that Ireland, Pipe, Fraser, Hetherington, Inghram, Lummis, Shriver, Thompson and Frazier elected themselves directors, and served until it went into the hands of a receiver April 6, 1921, except Hetherington who died in October, 1920; that Powell and Cottrell were agents of the directors after the incorporation and received part of the fees for the sale of stock. The company was chartered January 28, 1918, it is averred, with a capital of $100,000, consisting of 10,000 shares of $10 each. That January 2, 1919, defendants Ireland, Lummis, Pipe, Inghram, Fraser, Frazier, Shriver and Thompson each subscribed for 1,111 shares of the capital stock and Hetherington subscribed for 1,112 shares at $14 per share, the aggregate subscriptions being $140,000. It is further averred the stock was sold at $20 per share and those subscribing for all the shares at $14 paid for them out of the money received from complainants; that defendant promoters and their agents, and said directors and their agents, knew promoters’ fees were being taken and that they failed to disclose that fact to complainants and each of them.

It is charged in the bill that many and different statements were made by the promoters and their agents and by the directors and their agents as inducement to complainants to purchase stock, which statements it is alleged were false and known at the time they were made to be false and that complainants did not know they were false. In other parts of the same paragraph of the bill it is averred such false statements were made without the party making them knowing or caring whether they were true or false.

As to the defendants Cottrell and Powell, the lastly amended tenth paragraph of the bill charges they received, through defendant promoters, fees which were retained out of complainants’ several subscriptions, well knowing the secret retention of promoters’ fees and commissions and failed to disclose the fact, and fraudulently concealed it from them and that they made the false representations alleged in the bill, “which said representations were either intentionally fraudulent or so grossly careless of the truth or falsity of the facts as amount in law to a knowledge of falsity and fraudulent character of the representations and ought to make them liable with other defendant promoters and directors, whether caused by actual or constructive fraud.”

To this lastly amended bill answers were filed by all the defendants denying generally its averments, and that complainants were entitled to the relief sought; and averring that complainants were guilty of laches. Beplications being filed, the cause was referred to a special master to take and report proofs and findings of fact, conclusions of law, and recommend decree. Other averments of the bill will be noted hereafter.

A demurrer on the ground, among others, of multifariousness was interposed to the bill. It was overruled. It is now urged by appellees the bill is multifarious and for that reason, if no other, the decree should be affirmed. It does not appear that the chancellor dismissed it on that ground. But under the established practice he might with propriety do so sua sponte. Appellants contend it was not multifarious, because proceeding in the manner of the bill, a multiplicity of suits will be avoided. To this contention it may be replied: “A multifarious bill will not be allowed as a remedy, for a multiplicity of suits.” 21 Corpus Juris, page 307, note 99. The whole doctrine of multifariousness is contained in one sentence by Lord Eldon, a master of equity pleading, quoted by Story on Equity Pleading, page 262, note 1 (10th Ed.): “Seeking to enforce different demands against persons liable respectively, but not as connected with each other, it (the bill) is clearly multifarious.” Gains v. Chew, 2 How. (U. S.) 619, 11 L. Ed. 402 note.

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Bluebook (online)
235 Ill. App. 89, 1924 Ill. App. LEXIS 117, Counsel Stack Legal Research, https://law.counselstack.com/opinion/roeder-v-pipe-illappct-1924.