Union Trust Co. v. Trumbull (137 Ill. 146, 1891)

Mr. Justice Baker

delivered the opinion of the Court:

This is a contest between creditors of T. W. Hall & Co. as to their respective rights to the property which T. W. Hall & Co. assigned to John Kinsey for the benefit of their creditors, and upon which several of the creditors claim liens.

The firm of T. W. Hall & Co., composed of Thomas W, Hall, Charles Hall and William P. Hall, were merchants and factors in wool, having their office and warehouse in two connected buildings, known as Nos. 46 to 52 Dearborn avenue, Chicago. The firm was a customer of and kept a general deposit account with the Union Trust Company, a banking institution. The National Storage Company, in response to applications made therefor, issued to T. W. Hall & Co. receipts acknowledging the receipt of certain amounts of wool, and undertaking to deliver the same to the order of T. W. Hall & Co., at its warehouse No. 18, on the premises above mentioned, upon the payment of storage and charges, and the surrender of the receipts, properly endorsed. Thereupon T. W. Hall & Co. borrowed of Lyman Trumbull $8500, of the Commercial National Bank $17,500, of the Illinois Trust and Savings Bank $11,283.54, of Ira Tomblin $10,000, of the Union National Bank $6402.88, and of the Metropolitan National Bank $3000, and to secure these several loans delivered to the respective lenders certain of the above mentioned warehouse receipts, properly endorsed. William Parberry, Henry Kertz, Grande Bros., Patterson Bros, and Lienemann & Schmidt, severally, shipped to T. W. Hall & Co., as factors, certain quantities of wool, parts of which had not been accounted for at the time of the assignment. T. W. Hall & Co. issued and •delivered to Henry F. Vehmeyer, and to the Lincoln National Hank, respectively, as security for moneys borrowed from each •of them, their own receipts, acknowledging that they had received in store specified quantities of wool, subject to the •orders of said respective parties on said receipts, on surrender thereof, “storage and insurance free.”

In the summer of 1888 Thomas W. Hall left Chicago and went west, on business of the firm. Afterwards, and on July 19 •of that year, his partners executed and delivered to John Kinsey, as assignee, an instrument purporting to be a voluntary .assignment of the firm of T. W. Hall & Co. This instrument was recorded in the office of the recorder of Cook county on the day of its date, and filed with the clerk of the county court -on the same day. At that time the warehouse at 46, 48, 50 and 52 Dearborn avenue contained 318,683 pounds of wool, and it was all stored upon the second and third floors of the -connected buildings. Kinsey at once took exclusive possession of the entire warehouse, including the second and third floors and all their contents. On the next day, July 20, the National Storage Company, by a ruse, managed to get one of their men into the warehouse, and claimed, through him as their agent, to be in actual possession of the second and third floors and of the wool there stored. A dispute as to the possession of said "two floors and their contents thereupon arose between' the assignee and the storage company, which, by arrangement between them, resulted in an order by the county court, on July 23, directing the assignee to hold possession until the rights of all parties could be determined, and without prejudice to either, and ordering the storage company to yield possession to the assignee. On July 21, Thomas W. Hall, by an instrument duly recorded and filed, ratified and confirmed the assignment to Kinsey.

On July 23, a further order was made by the county court that the assignee file a petition making parties respondent thereto all persons, as far as ascertainable, who have or claim interest in or to the merchandise and premises, requiring them to answer the said petition, and to set forth their respective rights, and to submit themselves to the jurisdiction of the court in the premises. The assignee filed such petition, and the several persons and corporations above named were made ■respondents therein, and they filed their respective answers, and, by consent of parties, it was ordered that said answers .be taken also as cross-petitions in behalf of the respective parties.

The assignee, by direction of the county court, sold all the wool that came to his hands, the proceeds thereof being $51,--739.03. The cause was afterwards heard in the county court, and a decree entered, wherein it was ordered that the assignee, ■out of the proceeds of $51,739.03 reported by him, retain the sum of $5353.37 for items of expense and fees allowed him, and that he pay the residue of said sum of $51,739.03 as follows: To Patterson Bros., $5072.35; to Lienemann &