McMannomy v. Walker

Mr. Presiding Justice Gary delivered the opinion oe the Court. The statutory law of this State has been always, in substance, what it is now—that courts having chancery jurisdiction are to proceed “ according to the general usage and practice of courts of equity ” in particulars not regulated by statute, or rules established by the judges of the respective courts, “ consistent with the practice of courts of chancery, in cases not provided for by law.” Secs. 1 and 2, Ch. 22, Chancery. Thus the general usage and practice of courts of equity, in particulars not otherwise regulated by statute or rule, is a part of the law of the State, established by legislative enactment, and so treated by the Supreme Court at an early date. McClay v. Norris, 4 Gil. 370. And in that case the books of practice are cited with approval, showing that “ there is no question of law or equity, or disputed fact or facts, which a master may not have occasion to decide upon, or respecting which he may not be called upon to report his opinion to the court.” But the usage and practice did not warrant sending the witnesses before a master, to be there examined and cross-examined by the solicitors of the parties, merely that the testimony might be reported by the master to the court. The mode in which the evidence should come before the court is described in the case cited. Then came the act of February 12, 1849,' which provided that in chancery “ the evidence on the part of either plaintiff or defendant may be given orally, under the same rules and regulations as evidence in cases at common law,” which enactment has, in substance, continued in force to this day. Sec. 38, Ch. 51, Evidence. The right to put in oral testimony under this statute was rigidly guarded. Maher v. Bull, 39 Ill. 531. Still this statute was held not to abrogate the former law that a decree in chancery, giving relief—or denying relief where a ground for it is shown—must be justified by what appears in the record, or it will be reversed on appeal. White v. Morrison, 11 Ill. 361. And it was there held that the evidence justifying the decree might be stated in the decree, in a bill of exceptions, in a certificate of the judge, or in a master’s report. That was before the days of typewriters; nor was stenography resorted to so freely as of late. A practice grew up prompted partly by the greater convenience in appearing from time to time before a master, than to go through a case on one continuous hearing before the court, and partly by the general willingness of lawyers to have somebody else do the work—a practice of which an instance may be seen in Grob v. Cushman, 45 Ill. 119, of referring a cause to a master to hear and report the evidence. By the Revised Statutes of 1872, Sec. 39, Ch. 22, Chancery, that practice received legislative sanction, with the addition that the master might be required to report his conclusions thereupon, whether of fact or law, or both, the statute saith not. By construction, however, a reference, since the statute, has a much greater effect than it had under the former practice; for whereas a party might introduce under that practice, further evidence on the hearing before the court, except in a case of accounting (case last cited), now, upon such a reference, all the evidence must be put in before the master. Cox v. Pierce, 120 Ill. 556. In all this course of legislation and decision, there is no hint that the usage and practice as to reviewing the proceedings before the master, was in any particular changed. Whatever that usage and practice was, it still has the force and effect of positive law, because the legislature has so enacted. How what was, what is, that usage and practice ? If the master has not followed the terms of the reference to him the remedy is not by excepting to his report, but a special application should be made for some sort of order to have the irregularity corrected. Deimel v. Parker, 59 Ill. App. 426, citing Tyler v. Simmons, 6 Paige 127. If he has reported the facts correctly, with a wrong legal consequence, no exception is necessary; the question may be opened without. 2 Dan. Chy. 1310; 1 Barb. Chy. 553. But if his conclusions of fact are questioned, then, to review them, exceptions must be taken. And because of the many instances before us in which the usage and practice of courts of equity in relation to such exceptions has been disregarded, I propose to define or describe that usage and practice, so far as relates to taking accounts before a master, with so much of detail and reference to authority that a wayfaring man may know, if he will, what it is. That it is no new question here, see Minchrod v. Ullman, 60 Ill. App. 400, and Williams v. Lindblom, Ibid. 465. And first, if accounts to be taken in the course of a chancery case are difficult or complicated, they must be referred to a master—not because of any statute—but by usage and practice. Sec. 39, Ch. 22, has no relation to taking accounts. The master must always have reported his conclusions on accounts. The.parties can not put the labor upon the court; and if the court assumes the labor, it is error. Mosier v. Norton, 83 Ill. 519; Beale v. Beale, 116 Ill. 292. The master should require the parties first to state their own accounts, so that the evidence may be confined to disputed items. Patterson v. Johnson, 113 Ill. 559; 2 Dan. Chy. 1222. In some cases the court will order an account to be prepared by a party complainant with his bill, so that the proceedings shall be in reasonable form in case of an appeal. Morgan v. Morgan, 48 N. J. Eq. 399. The master having stated the account, and given notice to the parties that he has prepared a draft of his report, either party may, before the master, object to any conclusion of the master. If the master adheres to his conclusions, the party may renew his objections, as exceptions, before the court, to the same conclusions. It is at this stage that the proceedings in so many cases become irregular and abortive. It has become common here to refer chancery cases, under the section adopted in 1872, to a master to take and report evidence, with his conclusions. He reports his conclusions and all the evidence, with no other order or arrangement than the order of its introduction before him; no statement of where (in frequently several hundred pages) the evidence relating to any one of his conclusions is to be found. Upon this the party excepting expects the court to review all the evidence, pick out the part touching each item excepted to, and thus in effect to take from the labor, which the master performed for the ease of the court, all its usefulness. An unguarded remark in McClay v. Norris, 4 Gil. 370, that, upon the hearing of the exceptions, “ the whole evidence is brought forward and passes in review before the court,” has been regarded as embracing the whole law upon the subject. The court there was speaking to no question before the court. The sentence quoted, to be accurate, needs the insertion after the word “ evidence,” of some words equivalent to “ upon which the master found the conclusion excepted to.” In Brockman v. Aulger, 12 Ill. 277, it is said, apropos again, of nothing before the court, “ when exceptions (objections) are disallowed by the master, if the excepting party desires it, he sends up the exceptions disallowed, together with all the evidence relative thereto, when the exceptions stand for hearing before the court.” Upon what evidence a master found any one conclusion, can be known and stated only by himself, and without a statement by the master the court can not know whether it is reviewing the master or exercising original jurisdiction. To review his conclusion, the court must have a definite statement of the ground he stood upon. Thus, in Mayhew v. Brettingham, Cooper’s Chancery Reports, 43, the Lord Chancellor Cottingham, on appeal, referred back to the master a report upon an accounting “ to state on what evidence and grounds he allows or disallows any of the charges and discharges complained of by the exceptions taken to his report.” Such a reference can not be made by this court. That appeal was in effect a rehearing of the case; here an appeal is only for the correction of errors. 2 Dan. Chy. 1459. And so, though as before shown, the statement by the court of a complicated or difficult account is error, yet if done by stipulation of the parties, the decree wrill be affirmed without examination. Riner v. Tonslee, 62 Ill. 266. And this practice of requiring the master to state specifically the evidence relating to the conclusions excepted to, has been in several instances, in terms approved by the Supreme Court. Hurd v. Goodrich, 59 Ill. 450; Prince v. Culter, 69 Ill. 267; Pennell v. Lamar Ins. Co., 73 Ill. 303. Seventy years ago the practice and the reason—nay, the necessity—for it were thus stated by Chief Justice Marshall in Harding v. Handy, 11 Wheaton, 103. “ It may be observed, generally, that it is not the province of a court to investigate items of an account. The report of the master is to be received as true when no exception is taken; and the exceptions are to be regarded so far only as they are supported by the special statements of the master, or by evidence which ought to be brought before the court by a reference to the particular testimony on which the exceptor relies. Were it otherwise—were the court to look into the immense mass of testimony laid before the commissioner— the reference to him would be of little avail.” In Greene v. Bishop, 1 Clifford 186, Judge Clifford adopts the doctrine of Judge Story in Donnell v. Columbian Ins. Co., 2 Sumn. 366, in which case Judge Story says: “ The evidence which furnishes the ground of the exceptions should he required, by the party excepting, to be stated by the master; for otherwise the court will not wander at large into the evidence in order to ascertain whether, by possibility, the master was wrong in his conclusion or not.” In different phrase the Supreme Court of Alabama, in Alexander v. Alexander, 8 Ala. 796, lays down the same rule. “ It is too much to ask of the court to grope through a vast mass of testimony and documentary evidence in search of error which is alleged to exist somewhere, and by connecting in this instance, the accountant with the judge, to ascertain what the error is.” The court goes onto say that it was the duty of the dissatisfied party to except to such items as he considered improperly charged, and it would then have been the duty of the master to certify the evidence by which the disputed item was sustained. In all these cases the whole evidence before the master must have been before the court, else the court would have had no field to “ grope ” and “ wander ” in. A master’s report, not excepted to, is sufficient to found a decree upon. Hurd v. Goodrich, 59 Ill. 450. And exceptions which are futile are no better than none. I must stop, not for want of material, but because time and space will not permit me to exhaust it. I refer, however, to Mahone v. Williams, 39 Ala. 202, as the most complete case upon the subject. This is’ a bill by a judgment Creditor of the Chicago, Dan-ville and Vincennes Eailroad, and the object sought by it, is to reach the proceeds of some bonds which the appellant claims should be applied to the satisfaction of his judgment. There was a reference to a master, and upon that reference the object of the complainant was to fix a liability upon the appellee, for a large amount of such proceeds. The report of the master occupies nineteen pages of this record, and the evidence which accompanied it, more than six hundred; brought in without other arrangement or order than that of its introduction before the master, and without reference in the report to anyplace where any of the evidence, for or against any of the conclusions of the master, could be found. To that report the complainant put in before the master, as objections, and renewed before the court as exceptions, what is stated in the abstract, thus: “First. For that the master erred in finding Edwin Walker only received $4,000 per year as counsel for receiver. Evidence that it was $4,800 per year. Second. Erred in finding his retainers only covered consultation, advice, etc., and (third) in finding that his retainer was not to prosecute and defend suits, and also erred in not finding that Walker was paid for all services performed by him, exclusive of those in foreclosure case, and (fourth) that said payments of moneys by the receiver did not cover services in relation to intervening petitions. Sixth. For that said master finds that $85,000 is a fair and reasonable compensation for the services performed by said Walker for the Chicago, Danville & Vincennes Railroad Company and (seventh) for that said master has not found what is the usual and ordinary compensation for such services as were rendered by said Walker. Eighth. For that such finding is not in accordance with the order of reference herein, and is not the usual and ordinary compensation paid for such services, but is far in excess thereof, and is exorbitant, unreasonable, inequitable and unconscionable. Einth. For that the master has found that said Walker’s expenditures were $20,000 when he filed no itemized account thereof or vouchers therefor, and (tenth) that the same were not proper expenditures. Eleventh. For that said master has found that no credit should be made by the said Walker or charge to him for the ¡property known as the Chittenden farm, conveyed to him, and (twelfth) which he sold for $24,000 which should have been found to be in full payment of all the expenditures made by said Walker on account of said road, or litigation. Thirteenth. For that the same master finds that the payment to said Walker of $10,000 for becoming surety upon a bond of indemnity was a fair and reasonable compensation for so doing. Such finding not warranted by either the law or evidence as a proper charge. Fourteenth. For that said master allows the said Walker $10,000 for moneys paid to certain solicitors, which is not a proper charge or allowance. ¡No vouchers therefor. Fifteenth. For that said master allowed said Walker $2,000 in bonds instead of coupons which had been cut off, and which is no proper credit. Sixteenth. Because said findings are contrary to the evidence, and to law and equity. Therefore complainant excepts.” The only question in this case is, whether the Circuit Court erred in overruling those exceptions. That the court might have taken the course pursued in Mayhew v. Brettingham, Cooper’s Chancery Reports, 43, may be conceded, and yet the not doing so when not asked, is not error; but to sustain the exceptions would have been to disregard that usage and practice which I have attempted to show has the force and effect of statute law. It is idle to say that “ it is the lack of evidence to sustain the master’s report that justifies the exceptions, one and all. It was impossible to point out what does not exist.” The less-evidence there may be to sustain the report, the more quickly and briefly might the master have stated it, and the more clearly would the lack have appeared. There is no error, and the decree dismissing the bill of the appellant is affirmed.