Taylor v. Taylor

102 N.E. 1086, 259 Ill. 524

• Court: Illinois Supreme Court
• Decided: October 28, 1913
• Status: Published

Opinion

Mr. Justice Farmer

delivered the opinion of the court:

It is earnestly insisted that the court committed reversible error in permitting appellee to file an amended bill. The basis of this. contention is, that the amended. bill is inconsistent with and contradictory of the original bill, alleges a different state of facts as a ground for recovery, and was not filed until after appellee had testified before the master in support of his bill. The original bill, after setting out the visit of appellant to appellee in California and the representations made by him as to the value of their father’s estate and the amount of the indebtedness of appellee and Edna Taylor to said estate, alleges appellant offered to give appellee $500 and pay his and Edna Taylor’s indebtedness for a conveyance of appellee’s interest in the Iowa lands and the home farm. This occurred in the evening before the deeds were executed the next morning, and appellant then produced two deeds, one of them containing a description of the home farm, the other a description of the Iowa lands. The original bill alleges that appellee then read the deeds and agreed to sign them; that when they went to the notary public’s office appellant produced two deeds, which appellee signed without again reading or examining, and the bill alleges that if he signed the deed, conveying his interest in all the Illinois lands it was presented to him suddenly in place of the deed to the home farm, which he supposed it to be, and that he had never to his knowledge signed the deed appellant had placed on record and which purported to be a conveyance of all appellee’s interest in the Illinois lands. The amended bill sets out with somewhat greater detail the alleged fraudulent statements and representations of appellant as to the. value of the estate of John H. Taylor and the amount of the indebtedness of appellee and Edna Taylor; that he represented to appellee his interest in his father’s estate was not worth $500, but in order to adjust and settle the affairs of said estate he offered to pay appellee that sum in cash and assume and pay the obligations of appellee and Edna Taylor to the estate, in consideration of which appellee executed the two deeds conveying all his interest in and to the estate of John H. Taylor, including the rents and profits, and interest therefrom up to the time the. deeds were made.

The original bill was not sworn to, but appellant contends that it should be treated upon this question the same as if it had been sworn to, because appellee testified fully in its support before the master and did not again testify after the original bill was filed. We do not agree with this contention. But even if the rule applicable to the amendment of sworn bills applied, we think allowing the amendment could not be held to be reversible error. Section 37 of the act to regulate practice in courts of chancery authorizes courts to permit the amendment of bills upon such terms as may be deemed proper, so th,at neither party be surprised or unreasonably delayed thereby. It has always been held'in this State, and generally, we believe, elsewhere, that amendments in chancery proceedings are largely within the discretion of the court. Such amendments are often necessary to the proper administration of justice, but the court may impose terms where deemed necessary. (Senft v. Vanek, 209 Ill. 361; Gordon v. Reynolds, 114 id. 118; Booth v. Wiley, 102 id. 84; Hoyt v. Tuxbury, 70 id. 331.) Amendments to bills not sworn to are allowed with greater liberality than to sworn bills. Where the bill is sworn to, a complainant may be denied the right to amend by contradicting the facts sworn to, unless he can show the statement was a mistake. (Fowler v. Fowler, 204 Ill. 82.) Where an amended bill sets up a state of facts which, if true, would entitle the party to the same relief prayed in the original bill but different from the facts alleged in the original bill, and of such a nature that they must have been known to complainant when the original bill was filed, this may be considered in determining whether the facts stated in the amendment are true; (Calkins v. Calkins, 220 Ill. 111;) but unless permitting the amendment amounts to an abuse pf discretion it will not constitute reversible error. In Hardie v. Bulger, 66 Miss. 577, it was held that an amendment to a bill for the cancellation of.a mortgage for certain alleged reasons was permissible which set up other and even inconsistent reasons upon which the same relief was prayed. In Ingraham v. Foster, 31 Ala. 123, a bill was filed to settle a partnership in a steamboat and ascertain the complainant’s share of the profits. The bill alleged the complainant had sold his interest in the boat to a third person, who was entitled to his share of the profits. The bill was amended, the amendment alleging that the transfer, though absolute in form, 'was, in fact, only a mortgage, and it was held the amendment was properly allowed. Here no injury 01-prejudice resulted to appellant from the amendment. While it is true he was defaulted under the original bill, he was called as a witness by appellee and testified before the master, and after the amended bill was filed he answered it, appeared before the master and testified fully upon the charges and allegations therein and introduced all other competent testimony he desired to offer. The only real difference between the facts alleged in the original and amended bill is the allegation in the original bill of the agreement of appellee to convey only his interest in the home farm and the Iowa lands and the substitution by appellant of another deed for the one appellee had read' the evening before the deeds were executed. The allegations of the fiduciary relation between the parties, the false and fraudulent representations of appellant and the ignorance of appellee as to their truth are substantially the same in both bills and the relief prayed in them is not materially different. Appellee did not, change his testimony in any respect after filing the amended bill, for he did not testify again after filing it. The repugnancy or inconsistency of the allegations in the amended bill with those in the original bill were not of a character that allowing the amendment can be said to be such an abuse of the discretion of the court as to require a reversal of the decree. A refusal to allow the amendment would have presented a much more serious question.

It is further insisted, that as a condition of the relief prayed appellee was required to tender back to appellant, before bringing the suit, the $500 paid at the time the deeds were executed. We do not understand this case belongs to the class of actions for rescission where the party bringing the suit is required to offer to restore the other party to statu quo before commencing the suit. Appellant had, before the bill was filed, conveyed the home farm to his brother James and the Iowa farm to his sister. The bill recognized appellee was not entitled to rescission as to those lands, but prayed a money decree for his interest in said lands and for rescission as to the other lands and the personal estate. This he was authorized to do. (Preston v. Spaulding, 120 Ill. 208.) If appellant had retained title to all the land and the bill had sought rescission in to to, then there would have been better reason for the requirement that he offer to restore the benefits he had received before commencing his action. Here, however, appellant had made complete rescission impossible by conveying a part of the lands to innocent purchasers. Appellee asked, as he lawfully might do, that appellant be decreed to pay him in money the value of his interest in the lands so conveyed. The bill does not allege an actual tender of the $500, but alleges appellee had repeatedly offered to return the same to appellant, with interest, if appellant would re-convey to him his interest in his father’s estate, and the rents, conveyed by appellee to appellant, “and is now willing to return the said $500, as aforesaid, if the said Albert will restore to him his rights and interests in said property, as aforesaid.” If appellee was entitled to the relief prayed, appellant could be as effectually protected by giving him credit on the money decree rendered as if he had been tendered that sum before the bill was filed. In Pomeroy’s Equity Jurisprudence (vol. 6, sec. 688,) the author says: “In cases of fraud, if the defendant’s act has prevented a complete restoration of the status quo, he cannot, in justice, urge this fact as a defense to the rescission. * * * Neither is a party obliged to return that which he will be entitled to retain even though cancellation be decreed.” The author further says that many courts, in dealing with the question of rescission, have completely lost sight of the distinction betweén the equitable remedy and the legal remedy of rescission, and points out why the rule requiring an offer to place the defendant in statu quo before bringing suit is not of universal application in courts of equity, and says insistence upon it in equitable proceedings would often work a complete denial of justice. The author of the chap- „ ter on “Cancellation of Instruments” in 6 Cyc. says there is no little confusion upon this question among cases in the same jurisdiction. After stating that the numerical weight of authority slightly favors the rule that restoration, or an offer to restore, must be made before suit brought, the author says (p. 313) : “On the other hand, the courts of many States have held, in numerous well considered cases, that no offer of restoration • before bringing suit is necessary. These courts advert to the distinction, so often lost sight of, between the equitable remedy of rescission or cancellation, where the avoidance of the contract, with its indispensable adjunct of restoration, is accomplished by the decree of the court, and legal rescission, where the act of plaintiff in avoiding the contract re-invests him with his legal title or right to sue, and must therefore be accompanied with restitution of the thing received by him.” In a note to the text it is stated that a careful examination of the cases where the general rule was applied and no reference made to any exception to it, shows that the courts did not have their attention directed to the distinction between the. legal and equitable aspects of rescission. In Brown v. Norman, 65 Miss. 369, (7 Am. St. Rep. 663,) in a well considered case the court explains the distinction between actions for rescission at law and in equity in the application of the rule requiring an offer to place the defendant in statu quo before commencing the suit, and, reviewing authorities both American and English, holds it is not indispensable in suits in equity that the complainant offer to place thp defendant in statu quo where it would not be inequitable to permit a rescission without such requirement. In Stewart v. Stone, (N. Y.) 28 N. E. Rep. 595, the court holds that one who attempts to rescind a transaction on the ground of fraud is not required to restore that which in any event he would be entitled to retain. The exception, in equitable proceedings, to the general rule has been recognized by this court in Wenegar v. Bollenbach, 180 Ill. 222, and Harris v. Dumont, 207 id. 583.

The case of Rigdon v. Walcott, 141 Ill. 649, is typical of the cases in this court relied upon by appellant. Therein it was contended the bill brought the case within that class of cases wherein a tender was not required before suit brought, for the reason that the court could, by its decree, place the defendant in statu quo. The bill sought to rescind and cancel an agreement in consideration of which complainant had been paid $40,000 in cash. The court said the case made by the bill was not one where the defendant could be placed in statu quo by the decree; that the relief sought did not necessarily involve a money décree in complainant’s favor, out of which the consideration paid him could be deducted and thus satisfied. In the case at bar the facts alleged in the bill, if sustained by the proof, would entitle appellee to a money decree in a much larger sum than he had received from appellant, and the court could by its decree, if the relief prayed was granted, as fully protect appellant as if he had been offered the return of the $500 before the bill was filed. Appellee, both by his bill and in his testimony, agreed and consented that the $500, and interest thereon, be deducted from the amount he might be entitled to have decreed him as the value of his interest in the home farm and the Iowa farm, and this the court did by its decree. v

It is also insisted that the allegations in the bill as to fraud and misrepresentations are not supported by the evidence and that the decree is contrary to the weight of the testimony. What was said between appellant and appellee at the time the deeds were executed, and what representations were then made by appellant, is testified to only by appellant and appellee, and their testimony is in hopeless conflict. It was simply a question as to which one of them should be believed. The master believed appellee, and we are unable to say that he was not warranted in doing so. There is no controversy about the proposition that as a part of the, consideration for the deed appellant agreed to assume and pay the liabilities of appellee and his former wife to the estate. There is a conflict in the testimony of appellant and appellee as to the amount of the indebtedness of appellee and Edna Taylor to the estate. Appellant testified the indebtedness was $3800 more than appellee claimed and testified the amount was. This $3800 was made up by a $2000 note to the First National Bank of Galva, signed by appellee and his father, (appellee’s name appearing first on the note,) the $1500 recognizance paid by appellee’s father, and $300 of smaller items. Among the notes of appellee held - by his 'father was a note for $3800, dated February 1, 1898, which was the day appellee left for the west. He testified that $3800 note covered the $2000 to the Galva bank, the $1500 recognizance and $300 additional, the consideration for the $3800 note being that appellee’s father would pay the recognizance, the $2000 note and satisfy additional indebtedness of $300. Appellee testified appellant represented to him that his former wife had materially increased his indebtedness after he had left the State by borrowing from his father, so the indebtedness at that time amounted to about $23,000, that the lands of their father had depreciated in value since appellee left the State, and that the estate was not worth over $40,000 and had liabilities of about $20,000.' Appellant denied making any such representations.

The master found that the indebtedness of appellee and Edna Taylor to the estate amounted, principal and interest, to $12,751.81 on the third day of December, 1903, and that judgment had been taken by appellant, as administrator, for said indebtedness. The master further found that the personal estate of John H. Taylor was worth at that time $12,751.81, and deducting the widow’s share of one-third would leave $2125.30 as the share of the personal estate appellee was entitled to, which, credited upon his and his wife’s indebtedness, would leave a balance due the estate of $10,626.51, which sum, together with the $500, was the full consideration agreed to be paid by appellant for the conveyances. The master found the total value of all the lands of the estate to be $72,400. He found the rents collected by appellant for six years, less expenses of collection, amounted, with interest, to $22,082.06, and deducting the value of the widow’s dower from the land and her interest in the rents, (one-third,) appellee’s interest in the lands, rents collected and the personal estate left by his father amounted to $21,205.22. This was $7954.42 more than his and Edna Taylor’s indebtedness to the estate plus the $500 cash received. The court by its decree approved and confirmed these findings of the master, and also approved and confirmed the finding and conclusion of the master that the deeds were obtained by appellant by false and fraudulent representations as to the value of John H. Taylor’s estate and the liability of appellee and Edna Taylor thereto.

It is earnestly insisted by appellant that the value of the Illinois lands as found by the master and decreed by the court is higher than is warranted by the proof, and complaint is made that the highest value testified to by any witness was adopted in fixing the value of the home farm. Two witnesses for appellee testified the home farm was worth $140 per acre, two that it was worth $137.50 and one that it was worth $137. Two witnesses testified for appellant that the home farm was worth $105 per acre and one that it was worth $100 per acre.' The master found the value to be $140 per acre. One witness who was engaged in the real estate business and who resided in Wethersfield and was acquainted with the Wethersfield lots, testified they were worth $2000 in 1903. Another witness on behalf of appellant who was a farmer but at the time of his testimony was employed as a motorman on a street car line, and who had been assessor of his township, placed the value of the Wethersfield property at $1150. The master fixed its value at $2000. As to all the rest of the lands the master fixed the value at a lower sum than was testified to by some of the witnesses of appellee and higher than was testified to by some of the witnesses of appellant. There is abimdant proof to support the values fixed by the master, and the fact that some witnesses placed a lower value on the lands, or some of them, than the master did, or that averaging the values-from the testimony of all the witnesses on both sides would produce a lower value than that found by the master, • as contended for by appellant, would not justify or authorize a reversal of the decree on the ground that it was not supported by the evidence as to the value of the real estate.

In April, 1906, about one month before the original bill' in this case was filed, appellant made a report to the county court as administrator of his father’s estate, in which, he represented he had paid out $192.82 more than he had received. In that report he stated the notes of Frank and Edna Taylor had been sued upon in the circuit court, judgment taken against Edna Taylor, who was personally served, and judgment in attachment taken against the interest of Frank J. Taylor in the lands of John H. Taylor, deceased. This was more than two years after appellant had agreed to. assume and pay said indebtedness. The amended bill, by way of supplement, alleged that since the commencement of the suit appellant had, as administrator of John H. Taylor’s estate, brought two suits,—one in the circuit court of Rock Island county and one in the circuit court of Henry county,—upon notes of appellee to John H. Taylor, which were the same notes appellant agreed to pay, cancel and return to appellee at the time the conveyances were made. In this report of appellant as administrator, introduced in evidence, which was filed in February, 1908, he states that all the notes owing the estate, except those of Frank and Edna Taylor and two other persons, had been collected; “that the notes of said Frank Taylor are now in litigation and a suit pending to set aside a deed from said Frank Taylor to said administrator, and the notes of said Edna Taylor are not collectible, as said administrator verily believes; that steps were taken some years- ago to collect the notes of said Frank Taylor by a sale of his interest in the lands of said decedent, but that the widow of said deceased objected so strongly that the proceedings were suspended, and that their collection is further interfered with by the suit above mentioned, in which said suit the said widow is a party complainant.”

We deem it unnecessary to extend this opinion by a further reference to or comment upon the facts. Independently of the well known rule- that where a person who occupies a trust or fiduciary relation deals with the property in his care to his own advantage, as where he claims to have acquired it by purchase from the beneficiary, the burden is upon him, when the transaction is attacked for fraud, to prove he acted in good faith and that the transaction was a just and equitable one and beneficial to the other party, we are unable to say, from a careful examination of the record, that the decree was not warranted by the facts.

It is further insisted by appellant that the rents accruing after the death of John H. Taylor were not part of the estate and did not pass by the assignment in the deed of “all interest in the estate of John H. Taylor, deceased,” with full power to receive and receipt for the same. It is true, rents accruing after the death were not assets of the estate, but we think it clearly appears from the testimony and the acts and conduct of the parties that the language used in the deed was intended to, and the parties understood it did, assign appellee’s rights and interests in said rents.

We find nothing in the record that would justify a re-, versal of the decree, and it is accordingly affirmed.

Decree affirmed.