Council v. Bernard (319 Ill. 392, 1925)

Mr. Justice Farmer

delivered the opinion of the court:

On August 14, 1924, plaintiff in error, (who will hereafter be referred to as complainant,) individually and as trustee for her husband, William Council, filed her bill in the circuit court of Sangamon county seeking an accounting from defendants in error, Joseph Bernard and John R. Jones, (hereafter referred to as defendants,) and also to set aside a deed made by Council and his wife to Jones on August 23, 1923, conveying to him 421acres of land in Sangamon county. The bill alleges that a deed executed by Council and his wife conveying the real estate was made to Jones; that Jones paid nothing of value for the deed; that it was procured without consideration and by threats made by Bernard that he would foreclose the $50,000 mortgage he had on the premises if the Councils refused to make a deed to Jones; that Bernard knew that the mortgage was much larger than was owing; that the only money paid out by Bernard was $38,000, and that he had charged up to complainant usurious interest, commissions and personal services amounting to $84,000, and that all there was due to Bernard and Jones was the sum of $38,000 and interest. The prayer of the bill was that defendants be required to account for the money advanced to or for complainant; that the deed executed by complainant to Jones be set aside; that all the liens that defendants have be fully decreed by the court; and that Bernard be compelled to release said mortgage.

Each of the defendants filed a separate answer. The answer of Bernard admitted the execution of the deed by complainant to Jones but denied that such deed was secured by him or by reason of any threats made by him to complainant. The answer sets up that prior to July 21, 1920, William Council and attorney Michael Eckstein applied to Bernard to obtain a mortgage loan oí $50,000 for Council for the purpose of paying off certain existing incumbrances as represented by mortgages, foreclosure certificates and judgment liens against the property, all of which exceeded the sum of $45,000; that Council agreed to pay Bernard a brokerage fee or commission of $2000 for obtaining the loan; that the loan of $50,000 was secured, represented by five different mortgages on the property. The answer sets up the disposition of the proceeds of the $50,000 loan, showing the several incumbrances, judgments, etc., paid, including an attorney’s fee of $2000 to Eckstein, commission of $2000 to Bernard, and expenses of procuring and continuing abstracts, recording deeds, etc., of $561.77. The answer denies that Bernard made any usurious charge; alleges that the indebtedness represented by the mortgage was expended as set forth in the answer, and avers that neither complainant nor her husband has ever made any claim that Bernard owed money to them, or denied liability upon the mortgages and notes secured thereby, from the date of their execution, on July 21, 1920, to the time of the filing of the bill.

The answer of Jones admits the execution of the deed by Council and wife on August 23, 1923, conveying the real estate to him; that the deed was entered into in accordance with a written contract bearing the same date, which permitted the Councils to retain possession of the farm lands until March 1, 1925, to have the crops taken from the land during the years 1923 and 1924 and without payment of taxes, and granted to Mrs. Council an option to re-purchase the premises for the sum of $84,300 at any time prior to August 15, 1924. The answer denies that the deed was procured by reason of any threats or fraud on the part of Bernard, and sets up that Jones has done and performed everything which was required of him to be performed under the contract of purchase and sale.

The cause was referred to the.master in chancery to take the testimony and report his finding of facts and conclusions of law. The master reported, finding that on August 23, 1923, complainant conveyed to Jones the land in question, subject to certain mortgages, liens and taxes for 1923; that the deed was given for a good and valuable consideration paid and assumed by Jones and was not procured by fraud or duress on the part of either of defendants; that it was a valid conveyance and should not be held to be a mortgage. The master further found that on the same date complainant and Jones entered into a written agreement wherein Jones agreed complainant should, without payment of taxes, have possession of the premises until March 1, I92