ray v moll _ assignment 2-403

vvesnaw.84 N.E.2d 163336 III.App. 360, 84 N.E.2d 163(Cite as: 336 III.App. 360, 84 N.E.2d 163)

cAppellate Court of Illinois, Fourth District.

RAYv.

MOLL et al.

Gen. No. 48014.Jan. 14, 1949.

Appeal from Circuit Court, Effingham County; Ward P. Holt, Judge.

Page I

Action on a note by Ethel Ray against Arnold B. Moll, William H. Bauer, Dora Bauer, and C. H. Giescking.Judgment by confession, was entered in favor of the plaintiff. After obtaining leave, C. H. Giescking moved todeclare the judgment void and to restrain further proceedings thereunder, and from an order denying the motion,he appeals.

Reversed and remanded with instructions to allow motion to vacate and declare judgment void.

West Headnotes

III Judgment 228 €==504(4)

228 Judgment228Xl Collateral Attack

228XI(B) Grounds228k500 Errors and Irregularities

228k504 Irregularities in Proceedings228k504(4) k. Defects in Entry of Judgment by Confession or Consent. Most Cited Cases

Where judgment on note was confessed in vacation, there was no presumption in favor of regularity of proceedings pursuant to which judgment was confessed, and all facts were required to appear in record.

121 Banks and Banking 52 €==187

52 Banks and Banking52111 Functions and Dealings

52111(E) Loans and Discounts52k 187 k. Actions on Loans or on Paper Discounted. Most Cited Cases

Judgment 228 €==504(4)

228 Judgment228XI Collateral Attack


228k504 Irregularities in Proceedings

© 2012 Thomson Reuters. No Claim to Orig. US Gov. Works.

336 III.App. 360, 84 N.E.2d 163(Cite as: 336 III.App. 360, 84 N.E.2d 163)

228k504(4) k. Defects in Entry of Judgment by Confession or Consent. Most Cited CasesWhere assignee of note payable to bank did not allege or show authority for endorsement by bank's trustees,

endorsement was ignored and note treated as though there was no endorser thereon and judgment by confessionentitled assignee to no presumptions in favor of regularity of proceedings pursuant to which judgment was confessed. S.H.A. ch. 110, § 146.

131 Bills and Notes 56 C=467(1)

56 Bills and Notes56X I Actions

56k461 Declaration, Complaint, or Petition56k467 Transfer and Ownership

56k467(1) k. Necessity of Alleging Indorsement, Assignment, and Ownership. Most Cited Cases

Bills and Notes 56 C=467(3)

56 Bills and Notes56XI Actions


56k467(3) k. Bona Fide Purchase. Most Cited CasesAn order note unendorsed in hands of someone other than payee is to be treated as a chose in action re

ceived by assignment and holder suing on such note must set out facts showing in what manner he obtained possession and ownership thereof as required by statute, and it is not a sufficient allegation to allege that holder isactual bona fide owner for value. S.H.A. ch. 110, § 146.




56k467(2) k. Sufficiency of Allegations as to Indorsement, Assignment, and Ownership. Most CitedCases

Complaint of assignee of note payable to a bank and endorsed by trustees thereof merely stating that assignee was owner and holder of note was insufficient without allegation tending to show in what manner, when orfrom whom, assignee obtained possession of note as required by statute relating to unendorsed order notes In

hands of someone other than payee. S.H.A. ch. 110, § 146.



56k490 Presumptions and Burden of Proof56k496 Transfer and Ownership in General

56k496(1) k, In General. Most Cited Cases


336 III.App. 360, 84 N.E.2d 163(Cite as: 336 IIl.App. 360, 84 N.E.2d 163)

Bills and Notes 56 '8;=524

56 Bills and Notes56X I Actions

56k515 Weight and Sufficiency of Evidence56k524 k. Possession as Evidence of Ownership. Most Cited Cases

Mere possession of a negotiable instrument payable to order and not endorsed by payee is not alone evidence of title in possessor and burden is on possessor to show a delivery to him with intent to pass title. S.H.A.ch. 110, § 146.

161 Judgment 228 '8;=456(1)

228 Judgment228X Equitable Relief

228X(B) Jurisdiction and Proceedings228k456 Limitations and Laches

228k456(1) k. In General. Most Cited CasesAssignee of note payable to bank and endorsed by bank trustees who never qualified to confess judgment

under warrant of attorney attached thereto because of lack of allegation showing authority of bank trustees to endorse note received only a void judgment thereon to which laches was not a defense. S.H.A. ch. 110, § 146.

171 Judgment 228 '8;=346

228 Judgment2281X Opening or Vacating

228k346 k. Invalidity of Judgment in General. Most Cited Cases

Judgment 228 '8;=486(1)

228 Judgment228X I Collateral Attack

228XI(B) Grounds228k486 Invalidity of Judgment in General

228k486( I) k. In General. Most Cited CasesA void judgment can be impeached at any time and can be vacated by motion without affidavit.

181 Judgment 228 '8;=504(4)

228 Judgment228XI Collateral Attack


228k504 lrregularities in Proceedings228k504(4) k. Defects in Entry of Judgment by Confession or Consent. Most Cited Cases

A judgment confessed in open court on a note with a warrant of attorney attached thereto is a voidable judgment only because authority of attorney to confess judgment in open court is presumed and such judgment remains voidable until presentation of evidence by defendant to vacate such judgment including whether debt is


33611J.App. 360, 84 N.E.2d 163(Cite as: 336 IJI.App. 360, 84 N.E.2d 163)

actually owed.

191 Judgment 228 <8=504(4)

228 Judgment228Xl Collateral Attack


228k504 Irregularities in Proceedings228k504(4) k. Defects in Entry of Judgment by Confession or Consent. Most Cited Cases

Where judgment is confessed in vacation on a note with warrant of attorney attached thereto and neitherpower of attorney nor affidavit is sufficient to give court jurisdiction of defendant, a void rather than voidablejudgment results which anyone may attack, and whether defendant actually owed debt is not material.

**164 Ray Stroud, of Altamont, and Taylor & Schniederjon, of Effingham, for appellant.

Charles Wallace, of Charleston, and Parker, Bauer & Parker, of Effingham, for appellee.

BARDENS, Justice.Judgment, by confession, was entered by the Clerk of the circuit court of Effingham County, Illinois, on

June 28, 1941, in vacation, in favor of Ethel Ray (hereinafter referred to as appellee) against the makers of ajudgment note made in favor of the First National *362 Bank of Altamont, Illinois, and signed by Arnold B.Moll, Wm. H. Bauer, Dora Bauer, and C. H. Geiscking. The power of attorney contained in said note providedthat the makers, jointly and severally, empowered any attorney of any court of record to appear for them, oreither or any of them, in such court in term time or vacation, at any time, and confess a judgment without process against them, or either of them, in favor of the legal holder thereof, for such sum as may appear to be unpaid thereon, and to waive and release all errors which may intervene in such proceeding.

Upon the entry of the judgment, as above, execution was issued thereon on the same day against all of theabove named makers of said note, which was returned **165 unsatisfied on June 30, 1941. Alias execution wasissued on January 26, 1948, with the result that property belonging to C. H. Geiscking (hereinafter referred to asappellant) was levied upon and advertised for sale. On March 25, 1948, appellant filed his motion asking that thecause be re-docketed and for leave to present and fire a motion to declare said judgment void, and to restrainfurther proceedings under the execution issued in said cause. Leave was granted by the court, as asked, and pursuant to such leave appellant filed his motion to declare said judgment void and to restrain further proceedingsunder the execution issued in said cause. Appellee, on April 22, 1948, filed her motion and counter affidavitdenying appellant was entitled to the relief sought. Upon a hearing of the issues thus raised, the trial courtentered an order denying the motion of appellant. From this order the appellant brings the matter to this court,seeking a reversal thereof, alleging among other things, that appellee's complaint does not state a cause of actionagainst the appellant, and that the judgment, so entered by the clerk of the court, as above, is void. We are in accord with this contention.

*363 [I] The promissory note, on which appellee's cause of action is based, was drawn payable to the FirstNational Bank of Altamont, Illinois. The only endorsement appearing on the back of said note is as follows:'We, the trustees of the (Old) First National Bank of Altamont, Illinois, do hereby transfer, assign and set overthe within note without recourse either as a committee or as individuals. The trustees of the (Old) Bank, Chas.

©2012 Thomson Reuters. No Claim to Orig. US Gov. Works.

336 JIl.App. 360, 84 N.E.2d 163(Cite as: 336 III.App. 360, 84 N.E.2d 163)

Blakely, Ben Reiss'. Since appellee's judgment was confessed, in vacation, there is no presumption in favor ofthe regularity of the proceedings pursuant to which judgment was confessed, and all facts must appear in the record. Book v. Ewbank, 311 III.App. 312, 35 N.E.2d 961; People v. Whitehead, 90 III.App. 614, and Inglehart v.Chicago Marine & Fire Ins. Co., 35 III. 514.

[2] Nowhere in her original complaint or affidavit has appellee alleged, or shown, any authority for the endorsement as hereinabove set forth. Even though judgment has been rendered, it entitles her to no presumptionsin her favor and, therefore, for the purposes of this decision said endorsement can, and should be, ignored, andthe note treated as though there was no endorsement whatsoever thereon.

[3] An order note, unendorsed, in the hands of some one other than the payee, is to be treated as a chose inaction received by assignment, and a plaintiff suing on such a note is bound by the provisions of Section 22 ofthe Civil Practice Act of 1933, !II.Rev.Stats.1947, c. 110, § 146 (Sec. 18, Civil Practice Act of 1907), and must,therefore, set out the facts showing in what manner he obtained possession and ownership thereof. It is not a sufficient allegation in such a case to allege that the plaintiff is the actual bona fide owner for value Blanke v. Hammel, 256 III.App. 251. In the opinion of the court in the case of Blanke v. Hammel, supra, there appears the following: 'The Supreme Court of this State in the case of *364 Gallagher v. Schmidt. 313 III. 40,144 N.E. 319. inits opinion says: 'A declaration in a suit by an assignee of a chose in action does not state a cause of action in favor of the plaintiff unless it contains the allegations required by Section 18 (1933 Civil Practice Act-Section 22),showing the assignment of the chose in action, the actual ownership thereof by him, and setting forth how andwhen he acquired title. A declaration which fails to allege a fact without whose existence the plaintiff is not entitled to recover does not state a cause of action. Walters v. City of Ottawa, 240 III. 259, 88 N.E. 651; Prouty v.City of Chicago, 250 III. 222, 95 N.E. 147".

[4] Appellee, in her original action, alleged no facts tending to snow in what manner, when, or from whomshe obtained possession, merely stating that she 'was the owner and holder of said note'. Such allegation is insufficient.

The case at bar is not unlike the case of Joseph Bros. Lumber Co. v. Wolberg, 259 III.App. 123. where aholder of a note which carried only one endorsement, and that by an attorney in fact, brought suit 011 the same.In that case the court held **166 that the plaintiff must allege and prove the endorsement if such was to be reliedupon to establish plaintiffs title. If not, he, the plaintiff, must set forth in his claim the circumstances underwhich the note was received.

[5] There is a line of cases which holds that mere possession of a negotiable instrument, payable to orderand not endorsed by the payee, is not, alone, evidence of title in the possessor, and that the burden is on the possessor to show a delivery to him with intent to pass title. Elvin v. Wuchetich. 326 III. 285, 157 N.E. 243; Oulvey v. Converse, 326 III. 226, 157 N.E. 245; Collins v. Ogden. 323 III. 594, 154 N.E. 701; Kroer v. Smith, 318III.App. 489, 48 N.E.2d 743; and City Nat. Bank & Trust Co. of Chicago v. Oberheide Coal Co., 307 III.App.519, 30 N.E.2d 753. Although the above cases, on their face, do not in express wording state the doctrine announced *365 in Blanke v. Hammel, supra, they do, in fact, follow and support its result.

[6][7] It is contended that the appellant must be diligent, that he is barred by laches. Whether such is a valid argument is to be determined by the nature of the judgment which appellee obtained. Here appellee has neverqualified herself to confess judgment under the warrant of attorney which must be strictly construed. Appelleenot having shown any authority granted to her by the warrant of attorney received only a void judgment. Wells


336ll1.App. 360, 84 N.E.2d 163- (Cite as: 336 IIl.App. 360, 84 N.E.2d 163)

v. George W. Durst Chevrolet Co., 341 III. 108, 173 N.E. 92, and cases cited; Berlin v. Udell Priming Co., 271tll.App. 464, 469; Doss v. Evans, 270 I1I.App. 55. To such, laches is never a defense. A void judgment can beimpeached at any time. Barnard v. Michael, 392 III. 130, 63 .E.2d 858; Anderson v. Anderson, 380 til. 435.44 N.E.2d 54; People v. Old Portage Park District, 356 til. 340,190 N.E. 664; People v. Miller, 339 III. 573,171N.E. 672, People v. Brewer, 328 I1I. 472, 160 N.E. 76: and State Bank of Prairie du Rocher v. Brown, 263III.App. 312. A void judgment can be vacated by motion and need not be by affidavit. Gillham v. Troeckler,304 III.App. 596, 26 .E.2d 413 and cases cited; Duggan v. Kupitz, 301 III.App. 230, 22 .E.2d 392.

[8][9] Appellant contends that a judgment by confession will not be vacated, even though the power of attorney was insufficient to give the court jurisdiction of the defendant, if it appears that the debtor owes theamount of the judgment and that he has neither a legal nor an equitable defense to the debt and cites as authorityMay v. Chas. O. Larson Co., 304 III.App. 137, 138,26 N.E.2d 139. We have examined this case and cases citedtherein. A judgment confessed in open court under the circumstances stated above is a voidable judgment onlybecause the authority of the attorney to confess judgment in open court is presumed. Such judgment remainsvoidable until the presentation of evidence by the defendant to vacate said judgment including *366 whether thedebt is actually owed. However, where judgment is confessed in vacation, there is no presumption of authorityof the attorney and the judgment must stand or fall by the record as made at the time of the entry thereof. Judgment confessed in vacation where neither the power of attorney nor the affidavit is sufficient to give thecourt jurisdiction of the defendant) results in a void rather than a voidable judgment. Anyone may attackit. Whether the defendant actually owed the debt is not material. Desnoyers Shoe Co. v. First National Bank,188 til. 312. 58 N.E. 994.

Judgment is reversed and remanded with instructions to the lower court to allow the motion to vacate anddeclare the judgment by confession void.

Reversed and remanded.

CULBERTSON, P. J., and SCHEINEMAN, J., concur.

III.App. 4 Dist. 1949Ray v. Moll336 I1I.App. 360, 84 N.E.2d 163

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ray v moll _ assignment 2-403

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