Wolsey v. Neeley

Mr. Justice Waterman delivered the opinion of the Court. The construction of the contract out of which the controversy in this case arose, was passed upon by this court in Wolsey et al. v. Neeley, 46 Ill. App. 387, and there determined to be an agreement by plaintiffs in error to pay to the defendant in error fifteen per cent per annum upon the par value of sixty-five shares of stock of the Abbott Buggy Co., for the dividends upon such stock, whatever that might be. That contract is as follows : “ Contract and agreement entered into this 14th day of April, 1887, between C. H. Bunker and C. S. Wolsey, parties of the first part, and C. H. Neeley of the second part, all of the city of Chicago, county of Cook and State of Illinois. Whereas, the parties of the first part have this day sold and delivered to the party of the second part a certain sixty-five (65) shares of stock of the Abbott Buggy Co., a corporation doing business in the city of Chicago, State of Illinois, the par value of said stock being one hundred ($100) dollars each share. Now, witnesseth, for and in consideration of one dollar in hand paid, the receipt whereof is hereby acknowledged, and such purchase of said stock by said C. IT. Neeley, the said C. H. Bunker and C. S. Wolsey, parties of the first part? together or individually, agree to pay to said C. H. Neeley fifteen per cent interest per annunf on the sum of sixty-five hundred ($6,500) dollars, said interest to commence from the first day of November, A. D. 1887," and payable annually, said agreement to continue for three years. It is understood and agreed by all parties to this contract that any and all dividends that may be declared during the three years above stated by the Abbott Buggy Company on said stock purchased by said C. H. Neeley, shall go to said C. IT. Bunker and C. S. Wolsey, parties of the first part. It is further agreed and understood by all the parties to this contract, namely, C. H. Bunker and C. S. Wolsey, parties of the first part, and C. H. Neeley, of the second part, that, at the expiration of said term, namely, three (3) years from November first, A. D. 1887, the said C. H. Neeley shall resign, this agreement and shall retain the said sixty-five shares of stock if he so elect, or the said C. H, Bunker and C. S. Wolsey, parties of the first part, agree to purchase the said sixty-five (65) shares of stock at par value of one hundred ($100) dollars per share, if the said C. H. Neeley shall so elect. In witness whereof, we have hereunto set our hands and seals the 14th day of April, A. D. 1887. (Signed) C. H. Bunker, Chas. S. Wolsey.” It now appears that after the making of said contract, the said stock issued to the plaintiff below under the aforementioned contract was surrendered and canceled, and bonds of the Abbott & Staver Mfg. Co., to the amount of $6,500, were given the plaintiffs below in place of the said stock, the following agreement, then made, being indorsed on the back of the said contract: “Chicago, Oct. 1, 1890. The signing by C. H. Neeley of the agreement to exchange $6,500 A. B. Co. stock for seven per cent debenture bonds of the Abbott & Staver Mfg. Co. is at the request of C. H. Bunker and C. S. Wolsey, and in no wise alters, affects or changes the agreement and mutual obligations of the parties to this agreement, and in consideration thereof we agree tó accept bonds instead of the stock named therein. C. H. Bunker, Chas. S. Wolsey.” Thereafter the following correspondence was had: “ September 8, 1890. Friends, Bunker and Wolsey : On November 1, 1890, our contract expires. Although the stock is worth more than par, I believe I will let you have it, as I can use the money to good advantage. Please acknowledge receipt of this and oblige, Tours truly, C. H. Neeley.” “ Chicago, September 9, 1S90. C. H. Neeley, Esq., City. Dear Sir: Yours of September 8th, giving us notice of your desire to avail yourself of your option in our contract with you, is received and noted. Yours truly, C. H. Bunker.” The following admissions were made upon the trial: Mr. Ashcraft : Will it be admitted that under this agreement the Abbott Buggy Company and the Staver Buggy Company were consolidated as the Staver & Abbott Buggy Company ? Mr. Loomis: Yes. Mb. Ashcraft: And these debenture bonds issued in pursuance of that consolidation 2 Mr. Loomis : Yes. It is admitted that the defendant paid to the plaintiff, under this contract, on December 10, 1888, the sum of $487.50; on November 30,1889, $975; on July 19, 1890, $115.56; on August 14, 1890, $402.22; amounting in all to the sum of $1,980.22, $30.22 of which amount was for interest on deferred payments. The plaintiff claims that he is entitled to have the $975 unpaid of the fifteen per cent guaranteed, and sis per cent on the amount of the contract, plus the amount due on guaranteed dividends on November 1, 1896. Interest on November 1,1890, $6,500, the face of the debenture bonds, and $975 guaranteed dividends for one year. It will be admitted, I presume also, that on or about November 1, 1890, the plaintiff tendered these debenture bonds, and demanded the face of them. Mr. Loomis : Which we respectfully declined. Mb. Ashcraft: Yes, which they declined to pay. And thereupon the plaintiff rested his case. The court found for the plaintiff below, assessing his damages at $9,354.60. To reverse which the defendants below sued out a writ of error. The contract of April 14, 1887, in so far as it gave to C. H. Neeley an option to sell the said stock, was a gambling contract and void. Sec. 130 Criminal Code of Illinois; Schneider v. Turner, 130 Ill. 28; 27 Ill. App. 220; Tenney v. Foote, 95 Ill. 99; Corcoran v. Lehigh & Franklin Coal Co., 37 Ill. App. 577; 138 Ill. 390; Locke v. Towler, 41 Ill. App. 66; Peterson v. Cumen, No. 222, October term, 1895, Ill. App. That portion of the contract as to which there was no option, the agreement to pay fifteen per cent per annum for the dividends, was valid. Plaintiff below was entitled to recover the amount of said fifteen per cent he had failed to pay, viz., $975, which sum, with interest at five per cent per annum, he should have recovered. The judgment of the Superior Court is reversed save as to the sum of $975, with interest thereon at five per cent per annum from November 1, 1890, for which amount it is affirmed. Appellant will recover costs in this court. Reversed in part and affirmed in part.