178 N.E. 468 | Ill. | 1931
This cause is here on certiorari to the Appellate Court for the First District on petition of Henry I. Green, plaintiff in error, against the Ashland Sixty-third State Bank, defendant in error. The plaintiff in error will be designated hereafter as petitioner and the defendant in error as respondent.
Petitioner commenced a suit in the superior court of Cook county against respondent based on a contract in writing as follows:
"To E.A. Curtis, Pres. Ashland 63rd State Bank, Chicago
"Please credit acct. of Grant Park State Bank with $25,000 per deposit of U.S. bonds mentioned below. 10/13/25.
ANDREW RUSSEL."
"CHICAGO, ILLINOIS, October 13, 1925.
"This is to certify per instructions above that Andrew Russel has this day deposited with the Ashland 63rd State Bank, of Chicago, Illinois, twenty-five thousand ($25,000) dollars principal amount of bonds of the United States of America, bearing interest at three and one-half per cent (3 1/2%) per annum as evidenced by interest coupons thereto attached; that pursuant to said deposit credit has been given in said bank to the amount of $25,000 to the account of the Grant Park State Bank of Grant Park, Illinois, which said credit is to remain and be maintained accordingly for a period of seven (7) months from this date, unless during said period said bonds are withdrawn as hereinafter provided.
"It is understood and the undersigned therefore hereby agrees that if at any time within the period of seven (7) months from this date said Andrew Russel or the assignee of his rights hereunder shall so request, then in such event the said United States government bonds, with the coupons thereto attached, shall be promptly returned and delivered to the said Andrew Russel, or to such person, persons or corporation as the said Andrew Russel may designate, and the principal amount thereof charged against the account of the said Grant Park State Bank of Grant Park, Illinois; and any assignment or transfer by the said Andrew Russel of his rights or interests hereunder or in the property aforesaid, shall operate and be construed as a designation by him of the person, persons or corporation to whom such assignment or transfer shall have been made.
*177ASHLAND SIXTY-THIRD STATE BANK, By E.A. Curtis, President."
The declaration consisted of counts on this contract, in which was alleged, among other things, that on October 15, 1925, Russel assigned to petitioner all his right, title and interest in the bonds mentioned in the contract and designated petitioner as the person entitled to demand and receive the bonds deposited with respondent; that demand was made on respondent therefor on April 26, 1926, and that it refused to deliver the same, with resultant liability to petitioner therefrom. The declaration also contained the common counts. An affidavit of claim made by petitioner's agent was filed with the declaration, which was later supplemented by an affidavit of petitioner. Respondent filed pleas of the general issue that the promise in the contract was beyond the corporate powers of respondent, was ultra vires and void; that E.A. Curtis had no authority to enter into the contract on behalf of respondent; that the promise was without consideration; that the promise in the declaration mentioned and the deposit of the $25,000 of Liberty bonds, upon consideration of the respondent extending and giving credit to the Grant Park State Bank, which credit was to remain and be maintained for a period of seven months from the date of the agreement, was done solely for the purpose of establishing and maintaining a fictitious credit to bolster up the credit-standing of the Grant Park State Bank and to make it appear that said bank had a credit with respondent to the extent of $25,000, whereas in truth and reality no such actual credit existed, and that the Liberty bonds of the alleged value of $25,000 mentioned in the declaration were deposited by Andrew Russel in consideration of respondent extending credit to the Grant Park State Bank in the amount of $25,000; that in consideration of the deposit by Russel respondent did extend credit in the sum of $25,000 to the Grant Park State Bank, which credit was used and exhausted by said bank, no part of which has ever been replenished or returned to respondent by said bank, and that *178 the credit of $25,000 was used and exhausted by said bank prior to any demand being made by Russel or his assignee, or anyone else, for the return of the bonds.
A jury trial resulted in a judgment based on a directed verdict for petitioner for $29,326.46, against respondent. Respondent appealed to the Appellate Court for the First District, which reversed the judgment of the superior court without remanding and made a finding of fact, finding, among other things, "that defendant bank accepted said deposit and made said credit as directed, and that said credit was used by the Grant Park State Bank and has not been re-paid; that under the terms of the agreement the bonds were to be returned to plaintiff's assignor, or his assignee, upon the contingency that said credit was not used or was re-paid; that said contingency has not occurred; that plaintiff has not alleged in his declaration that he, as assignee, is the owner in good faith of the cause of action or verified his declaration, as required by section 18 of the Practice act, and for that reason also he may not maintain this suit."
Respondent urges that the contract in question was without consideration and therefore void. While it is true that a contract, to be binding, must be based upon a consideration, the rule is well settled that any act which is of benefit to one party or a disadvantage to the other constitutes a sufficient consideration to support a contract. (Anderson v. Bills,
Without passing upon petitioner's claim that the affidavit of his agent and petitioner's supplemental affidavit were a sufficient compliance with section 18 of the Practice act if such compliance were required, suffice it to say that respondent by its contract agreed that at any time within seven months, upon the request of Russel or the *179
assignee of Russel's right under the contract, it would promptly return and deliver the bonds and attached coupons to Russel or to such person as Russel might designate, and that any assignment or transfer of Russel's right should operate and be construed as a designation by him of the person to whom such assignment was made; that prior to the commencement of the suit, and within seven months of the execution of the contract, Russel assigned all his interest to petitioner and designated him as the person entitled to receive the bonds; that petitioner accepted the assignment and that respondent had notice thereof; that petitioner demanded the delivery of the bonds and that respondent refused delivery, and that therefore respondent's resultant liability, if any, was a direct contractual liability to petitioner, to which section 18 of the Practice act has no application. It has been settled by repeated decisions of this court that in case of simple contracts the person for whose benefit a promise is made may maintain an action in his own name upon it although the consideration does not move from him. Lawrence v. Oglesby,
Section 1 of the Banking act (Smith's Stat. 1929, chap. 16 1/2, par. 1,) provides that banks may be organized to receive deposits, loan money and do a general banking business. Banks are authorized to receive special as well as general deposits, and when such special deposits are received the bank is bound to carry out the terms of the deposit for a special purpose. Where a deposit is made in a bank and the identical property deposited is to be returned to the depositor and not the equivalent thereof, the deposit will be special and the bank will have no authority to use the money in its business, and it is its duty to safely keep and return the identical deposit to the depositor. *180
(People v. Farmers State and Savings Bank,
The president of a corporation, by virtue of his office, is the business head of the corporation, and as a general rule any contract pertaining to corporate affairs within its general powers will, when executed by the president and in the absence of proof to the contrary, be presumed to have been executed by authority of the corporation as one of the powers incident to his office. (Bloom v. Vehon Co.
It is intimated that this deposit was made for an illegal purpose. The burden of proving this charge rested on respondent, and while E.A. Curtis was living at the time of the trial, as shown by the record, neither he, Vern Curtis nor Russel was called as a witness to testify with reference thereto, nor as to the previous financial dealings between respondent and the Grant Park Bank, nor as to the status of the accounts between the two banks at that time, nor as to any of the circumstances within their knowledge which might throw light upon the reasons for the making of the contract in question and their situation at the time, and so be of assistance to us in construing the contract.
The Appellate Court found that under the terms of the agreement the bonds were to be returned to petitioner's assignor or his assignee upon the contingency that the credit was not used or was re-paid, and that said contingency had not occurred. The contract is not susceptible of that construction. In plain language it states that pursuant to the deposit made by Russel a $25,000 credit has been given to the Grant Park State Bank and that credit to that extent shall continue for seven months unless the bonds are sooner withdrawn. Permission to withdraw them at any time was given to Russel or his assignee, and in the event of a withdrawal the amount of the bonds shall be charged against the account of the Grant Park State Bank. The contract does not require the account of said bank to have in it a sum equal to or in excess of the amount of the bonds as a condition precedent to withdrawal of the bonds. The only *182 provision is that when the bonds are withdrawn a charge against the account shall be made in an amount equal to the bonds. Russel and his assignee had no control over the account but the respondent bank did have supervision over it, and with knowledge of the contract provisions it could have protected itself against the possibility of a bond withdrawal while there was insufficient money in the account to meet a charge off of the bonds. If it suffered a loss because it did not so protect itself it cannot put the loss upon Russel or his assignee.
In construing a contract effect will be given, if possible, to each clause, phrase and word used in the contract, as it is presumed that the parties meant something by the use of the particular language used by them. (Weger v. Robinson Nash MotorCo.
The judgment of the Appellate Court is reversed and that of the superior court affirmed.
Appellate Court reversed. Superior court affirmed.