Smith v. Billings

62 Ill. App. 77, 1895 Ill. App. LEXIS 382
CourtAppellate Court of Illinois
DecidedJanuary 22, 1896
StatusPublished
Cited by10 cases

This text of 62 Ill. App. 77 (Smith v. Billings) 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
Smith v. Billings, 62 Ill. App. 77, 1895 Ill. App. LEXIS 382 (Ill. Ct. App. 1896).

Opinion

Mr. Justice Waterman

delivered the opinion of the Court.

Appellant insists that he is entitled to a set-off against the amount due upon his note and mortgage in process of foreclosure the amounts he claims to be due him in respect to matters entirely disconnected with the subject-matter of the foreclosure suit; this, he insists, is his right. Appellant claims that the mortgagee is, and was at the time the mortgage and notes were made, indebted to him, the mortgagor, in and for large sums of money, then unknown to him, held for him. There is no showing that the matter of these newly-discovered claims- against the mortgagee have any connection with, the mortgage debt. The claims made by the mortgagor are by him as a cestui que trust against the mortgagee, as a trustee in respect to trust funds said to be in his hands.

The court is asked, upon a matter of a simple foreclosure of a mortgage given by appellant to secure his notes, to enter upon an investigation of trust relations said to be existing between the mortgagor and the mortgagee, totally disconnected with the matter of this foreclosure, without any allegation of any special equity, as the insolvency of the mortgagee, requiring it to do so.

As to all of the claims made by appellant which are unliquidated, that is, for uncertain sums, no case for allowing a set-off is presented.

While it is true that a court of equity will sometimes allow a set-off when the same would not be permitted at law, the circumstances calling for such action must be special; that is, special grounds demanding such action must be shown—as the insolvency of the complainant—perhaps the reason which has most frequently moved courts of equity to allow a set-off when not permissible at law. Such was the basis of the action of the court in Blake v. Langdon, 19 Vt. 458; in Ex parte Stephens, 11 Vesey, 24, and Chicago, Danville & Vincennes Ry. Co. v. Field, 86 Ill. 270.

There is no such thing as an inherent equitable right to set off one demand against another. Hackett v. Connett, 2 Ed. Ch. A. 73.

The equitable right exists where the debts existing at the time of the commencement of the suit are mutual; that is, one was created because of the existence of the other—grew out of the same transaction; exist in the same right, and are of such a certain and ascertainable character as to be capable of being applied in compensation of each other. Waterman on Set-off, Secs. 410, 415, 420.

An unliquidated demand, in no way connected with a mortgage debt for the foreclosure of which a bill is filed, which demand is not a proper subject of set-off at law, can not be set off in such foreclosure suit unless there is some peculiar equity to take"it out of the general rule. Waterman on Set-off, Sec. 428; Derby v. Page, 38 Ill. 27-30; Parkinson v. Trousdale, 3 Scam. 410-428; Story, Eq. Juris., Sec. 1436; Jennings v. Webster, 8 Paige 503; Litch v. Clinch et al., 136 Ill. 410-429.

So many of appellant’s claims as are unliquidated, that is, not certain, asceitained or capable.of being arrived at by a mere computation, are not, in this case, matters which appellant is entitled to have set off. This applies to all claims on account of the alleged conversion and sale, by Billings, of stock.

Appellant does not, in respect to this, charge that Billings received a certain amount for such stock, and that he, appellant, is entitled to a certain named sum; what has been said applies to all other claims made by appellant, the amount of which is not fixed and definite.

If appellant is entitled to set off any of the claims by him made, it is because of the statute of this State. Equity follows the law, and what might be set off in an action at law, may be in equity. Wiltsie on Foreclosure, Sec. 376; Waterman on Set-off, Secs. 406-409.

Under the statute of this State, unliquidated demands, which do not grow out of the contract or cause of action sued on, can not be set off in an action at law. Hawks v. Lands, 3 Gil. 227; Sargeant v. Kellogg, 5 Gil. 273; Bush v. Kindred, 20 Ill. 93; De Forrest v. Oder, 42 Ill. 500; Hartshorn v. Kinsman, 16 Ill. App. 555.

Unliquidated damages are such as are unascertained; as those arising out of torts, as well as those following breaches of contract, where the amount of damages has not, by agreement, been determined. Upon an action to recover for breach of contract to complete a house by January 1st, the damage which the plaintiff has suffered by reason of the non-completion at the time promised, is the thing sued for; if by arrangement when the contract was made, it has been agreed that the builder should pay $100 and no more for such breach, this sum is spoken of as liquidated damage. Although all declarations in assumpsit conclude with an allegation of damages, it is, strictly speaking, incorrect when the suit is for a fixed and ascertained sum to call the amount recovered “ damage.” In an action of assumpsit to recover the amount of a promissory note or other undertaking to pay a definite, fixed sum, the action is not for damages, but for a definite sum, not to recover damage for non-payment of a sum, but the sum, and this it is the jury give. Rudder v. Price, 1 H. Blackstone, 547-555.

Appellant alleges that he was the owner of one-half of 660 shares of stock, that appellee held the same, and received thereon a dividend of $2,640, one-half of which, $1,320, belonged to him, appellant. This is an allegation of an indebtedness for a certain fixed sum, and if to be termed an allegation of damages, is for liquidated damages. Appellee, by his exceptions and demurrer, admits the allegation to be true. If true, appellant would, in an action brought at law upon the notes, to secure which the mortgage sought here to be foreclosed was given, be entitled to set the same off against such notes, for although not growing out of the contract or transaction upon which the notes were given, it is a liquidated debt; if such set-off is permissible when a money judgment is sought at law, it is in equity when a money decree is asked in equity.

The allegation, as to the reception, by appellee, of, or appellant of $10,000 from Drew, "would come under the same rule, if appellant had restricted his demand to a claim for the $10,000 received, but appellant claims a large amount of interest thereon, without supplying any data by which the interest can be calculated; the time of the reception of said $10,000 is not given. It is necessary that evidence "should be adduced to show the amount of interest to which appellant is entitled; a reading of his answer and bill will not suffice; the claim is therefore unascertained, indefinite, and not, upon the present pleadings, the subject of set-off.

The claim of appellant for services rendered to appellee, for which he is said to be legally and equitably indebted to appellant in the sum of $10,000, amounts to a charge only, and he has for some years acted as an attorney for appellee, and that appellant thinks and charges that such service was worth $10,000, and that appellee is indebted to appellant in the sum of $10,000 therefor. This account appears to be an unsettled, unliquidated claim, not the subject of set-off.

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Bluebook (online)
62 Ill. App. 77, 1895 Ill. App. LEXIS 382, Counsel Stack Legal Research, https://law.counselstack.com/opinion/smith-v-billings-illappct-1896.