Carroll v. Barry Bros. Transportation Co.

Mr. Justice Freeman delivered the opinion of the court. It is urged by appellees’ counsel that this court has no jurisdiction to entertain the appeal because, as it is said, the bill seeks a rescission of the sale and an accounting, “ and the injunction was simply ancillary.” The argument is that since'the order dissolving the injunction was unappealable, and the order dismissing the bill was made on appellant’s motion after the order of dissolution was entered, therefore appellant is estopped from assigning error on the court’s action taken at his own instance. Appellant claims, however, that the only relief sought by the bill is an injunction restraining appellees from foreclosing the mortgage on the vessel and from collecting the notes thereby secured, even though there is also a prayer for an accounting; and that the motion to dissolve “operated precisely as a demurrer and by it the defendant admitted the truth of all the allegations relied upon to entitle the complainant to an injunction.” Titus v. Mabee, 25 Ill. 232-235. It is well settled that where the only relief sought by the bill is an injunction, a motion to dissolve for want of equity on the face of the bill operates as a demurrer to the bill admitting the truth of its allegations, and when such motion is allowed the case is virtually at an end. If thereupon the complainant is willing to rest his case upon a demurrer, he must move the court to dismiss the bill, thus obtaining a final order of dismissal from which appeal or error will lie, although neither would lie from a mere decision on the demurrer or motion to dissolve. The latter is merely interlocutory. So where the only relief sought by the bill is an injunction, the complainant, upon dissolution which is in effect a final order denying all relief, may dismiss his own bill and take an appeal or writ of error. Williams v. Chicago Ex. Co., 188 Ill. 19-26. In Titus v. Mabee, supra, it is said: “If other relief were sought by the bill the decree dissolving the injunction could not, however, be regarded as final.” In the bill under consideration the complainant “submits and claims that he is entitled to have an accounting with said defendants of the several sums he has already paid to said Barry Bros. Transportation Co., * * * and to have a decree * * * for the sum which may be found by the court to be due him in the premises.” Upon payment of that sum and cancellation of the notes and mortgage he offers to return the vessel to the Barry Bros. Transportation Co. and to do whatever else the court in equity may require. The prayer of the bill is that an account may be taken as between complainant and Barry Bros. Transportation Co. and a decree “entered for such sum as may be found by the court to be due .to him from said Barry Bros. Transportation Company.” Then follows the prayer for an injunction against all the defendants to restrain them from collecting or attempting to collect, from transferring the notes and mortgage and from foreclosing the mortgage, or forfeiting appellant’s interest in the vessel. It thus appears that against three of the defendants, John Barry, Peter Barry 'and The Continental National Bank, the only relief sought is the injunction. Against them, therefore, the order dissolving the injunction was in effect final and as to them appellant was entitled to dismiss his bill and prosecute his appeal as he has done. Notwithstanding the prayer for other relief against one of the defendants, we think the bill may be properly regarded as substantially seeking an injunction only. Appellant not only concedes but contends that upon the allegations of the bill and aside from the relief by injunction, he could not maintain it as one merely for an accounting or for rescission of the contract with the transportation company. Appellant treats the appeal therefore as involving only the propriety of the injunction. As said in Gardt v. Brown, 113 Ill. 475-480, “Appellants have treated the decree as final, and had they not their appeal would be dismissed.” It is further contended by appellees that appellant is not entitled to have the collection of the notes and foreclosure of the mortgage restrained by injunction while he retains the vessel and makes no offer to return it. The bill contains an offer to return the vessel upon cancellation and return of the notes and mortgage given by appellant, and repayment of what upon an accounting may be found due him. It is urged by appellant that the case presents an exception to the general rule which requires a partir seeking to recover what he has parted with upon a contract which he was induced to enter into by fraud, to show that he rescinded the fraudulent contract before the commencement of the action at law by a return of the property obtained on his part under the contract. There are, however, authorities to the effect that the defrauded party may bring his action in equity and offer in his complaint to restore to the defendant what he has received, and that the rights of the parties can be fully regulated and protected in such action by the judgment when entered. It is said that such action ‘does not proceed upon a rescission but proceeds for a rescission.” Gould v. Cayuga County National Bank, 86 N. Y. 75-83. In the case cited it is further said (p. 84): “The conclusion we thus reach leaves a defrauded party with ample remedies. One situated like the plaintiff can rescind by tendering or restoring what he has received and then commence his action. He may keep what he has received and sue to recover damages for the fraud; or he may commence an action in equity to rescind and for equitable-relief, offering in his complaint to restore in case he is not entitled to retain what he has received. 'These actions are all fundamentally different.” See also Allerton v. Allerton, 50 N. Y. 670-671, and Harris v. Equitable Life Assurance Society, 64 N. Y. 196-200. In the case last mentioned it is said: “In Allerton v. Allerton (50 N. Y. 670) this court held that the rule, that he who seeks to rescind an agreement upon the ground of fraud must place the other party in as good condition as that in which he was when the agreement was made, is satisfied if the judgment asked for will accomplish that result, and in such case no offer to return that which was received is necessary.” In Hodson v. Eugene Glass Co., 156 Ill. 397-406, it is said that" “equity will exercise the remedy of cancellation where there is actual fraud in the party defendant in which the plaintiff has not participated. The jurisdiction proceeds upon the ground that where the enforcement of an instrument would be inequitable and unjust, the party holding it should be compelled to surrender it for cancellation. One of the instances in which the jurisdiction is often exercised is in relation to negotiable instruments before their maturity (3 Pomeroy’s Eq. Jur., sec. 1377; 1 Story’s Eq. Jur., secs. 695, 700). In such cases an injunction is generally granted against the transferring of such an instrument. (3 Pom. Eq. Jur., see. 1377, page 417, note 1).” In the case at bar the bill was filed before the maturity of any of the notes in” controversy. The mortgage securing them by its terms authorizes the seizure of the vessel without notice in any port in this or other states' where appellees may choose to seize her. There are allegations in the bill which, if true, tend to support the charge of fraud as alleged. We are of opinion, therefore, for reasons indicated, that the Superior Court erred in dissolving the injunction for want of equity upon the face of the bill. The notes in controversy, secured by chattel mortgage, are by the terms of the statute (R. S. chap. 95, sec. 25,) when assigned, subject to all defenses existing between the payee and payor. The decree of the Superior Court must be reversed and the cause remanded. Reversed and remanded.