153 Ill. 590 | Ill. | 1894
delivered the opinion of the court:
Paragraph 6 of section 70, chapter 3, of the Revised Statutes, is as follows :
“Sixt7i—Where the decedent has received money in trust for any purpose, his executor or administrator shall pay out of his estate the amount thus received and not accounted for.”
The question presented by this record for our determination is, whether or not appellant’s claim against the estate of Gamble should have been allowed as a preferred one, under the clause of the statute above quoted.
It has been decided by this court that the word trust, , appearing in said statute, is to be taken as used, not in its broader sense, as embracing every case in which a confidence has been reposed, but in its more restrictive sense; that the statute applies to technical trusts only, and has no application to trusts which the law implies from a contract. (Wilson et al. v. Kirby, 88 Ill. 566.) In deciding the Wilson case this court adopted the reasoning followed in Chapman v. Forsyth, 2 How. 202, and in Cronan v. Cotting, 104 Mass. 245. The case of Svanoe v. Jurgens, 144 Ill. 507, is to the same effect, as are also other cases decided by this court and cited therein.
It seems that appellant, who contemplated the purchase of the Palace Hotel, as evidenced by the agreement of February 25, desired to complete the equipment and furnishing of it, to be enjoyed by him when such purchase should have been consummated; that he had no money to expend for that purpose, and so he executed the- five notes of the first series to Gamble, who was to negotiate the same and use the proceeds thereof in furnishing and equipping the hotel, as also evidenced by the said agreement of February 25 ; that Gamble, in pursuance of said agreement, endorsed said notes and sold them, depositing with each note capital stock of the Palace Hotel Company, of the nominal value of $20,000, as collateral. The proceeds realized from the negotiation of the notes were deposited by him in bank, to the credit of the Palace Hotel Company. Furniture, etc., to the amount of many thousands of dollars, was purchased by Gamble from time to time, during the spring of 1889, for the Palace Hotel, but what portion thereof was purchased subsequently to March 5, the date of the execution of the first series of notes, does not appear. Such purchases were not paid for in cash, but were made upon the credit of the Palace Hotel Company. Gamble, personally, guaranteed payment of the purchase money. He afterwards paid about $3000 of the amount so due, but it does not appear that this $3000, or any portion of it, was a part of the money realized upon appellant’s notes. What became of that money is not shown.
The relation of the parties to each other, it would seem, was that of principal and agent. Gamble, who assisted appellant in raising the $25,000, was to apply it in equipping and furnishing the Palace Hotel in behalf of appellant, who expected that the agreement of February 25, for the transfer to him of said hotel, would soon be executed, and that he would then soon come into possession of it. Of course, from the very nature of the transaction, appellant must have reposed confidence and faith in Gamble in order to have entrusted him with the expenditure of so large a sum of money; but it by no means follows that Gamble was, technically speaking, a trustee, for every reposing of confidence does not constitute a trust. Gamble was, of course, responsible for the fund so placed in his hands, and his estate is liable to account therefor. But we are of the opinion that the transaction did not constitute a trust, unless it were merely such an one as the law would imply from the contract. Inasmuch, however, as it is settled that the sixth clause of the statute in question does not apply to such a trust, it follows that there was here no such trust as would warrant the allowing of appellant’s claim as a preferred one of the sixth class. Wilson et al. v. Kirby, supra; Svanoe v. Jurgens, supra; Weer v. Gand, 88 Ill. 493; Doyle v. Murphy, 22 id. 502; Chapman v. Forsyth, supra.
Appellant is entitled to have his claim allowed against the estate of Gamble as a claim of the seventh class, but as the parties agree that if the claim shall not be allowed as one of the sixth class then the judgment of the Appellate Court shall be affirmed, since such claim would not be of sufficient value to justify the cost of litigation, and desire this court to act upon such agreement, the judgment of the Appellate Court is therefore affirmed.
Judgment affirmed.